November 25, 2009

Financial Results for the Six Months Ended September 30, 2009
Fukoku Mutual Life Insurance Company (President: Tomofumi Akiyama) announces financial results
for the six months ended September 30, 2009.

[Contents]…………………

P.1

in the First Half of Fiscal 2009 …………………

P.3

3. Investment Results of General Account Assets…………………

P.6

4. Non-consolidated Balance Sheets…………………

P.13

5. Non-consolidated Statements of Operations…………………

P.14

6. Non-consolidated Statement of Changes in Net Assets…………………

P.15

7. Breakdown of Ordinary Profits (Fundamental Profit)…………………

P.23

8. Disclosed Claim Based on Categories of Obligors…………………

P.24

9. Risk-monitored Loans…………………

P.24

10. Solvency Margin Ratio…………………

P.25

11. Status of Separate Account…………………

P.26

1. Business Highlights
2. Investment Activities of General Account Assets

Attached: Supplementary Materials for the Six Months Ended September 30, 2009

1. Business Highlights(1) Policies in Force, New Policies and Surrendered and Lapsed Policies(i) Policies in Force
As of September 30, 2009
Number of policies(Thousands)

Individual insurance
Individual annuities
Subtotal

As of March 31, 2009

AmountChanges(%, Pre-FYE)(100 millionsof yen)Number of policies

AmountChanges(%, Pre-FYE)(Thousands)

293,374

97.0

2,976

98.3

2,967

99.7

744

100.4

29,799

99.8

741

3,711

99.9

323,174

97.3

3,717

Changes(%, YoY)(100 millionsof yen)Changes(%, YoY)

302,327

95.2

103.3

29,864

101.6

99.3

332,19195.8

Group insurance−−

157,862

102.9

−

−

153,365101.3

Group annuities−−

19,976

100.0

−

−

19,975

98.7

Notes: 1. Policy amounts for individual annuities are equal to (a) the funds to be held at the time annuity payments are to commence for an annuity for which annuity
payments have not yet commenced and (b) the amount of policy reserve for an annuity for which payments have commenced.
2. Policy amount in force for group annuities is equal to the amount of outstanding policy reserve.

(ii) New Policies
Total
Six months ended
September 30, 2008

Number of policies(Thousands)

AmountChanges(%, YoY)

Net increase by
conversion

New business(100 millionsof yen)AmountAmount(100 millionsof yen)Changes(%, YoY)

Changes(%, YoY)(100 millionsof yen)Changes(%, YoY)

Individual insurance

155

82.7

8,270

76.6

8,159

79.6

111

20.4

Individual annuities

28

110.1

978

111.6

988

111.5

(9)

−

101

18.9

184

86.0

9,249

79.2

9,148

82.1

Group insurance

−

−

414

205.2

414

205.2

Group annuities

−

−

0

0.1

0

0.1

Subtotal

Total
Six months ended
September 30, 2009

Number of policies(Thousands)

AmountChanges(%, YoY)

Net increase by
conversion

New business(100 millionsof yen)Amount(100 millionsof yen)Changes(%, YoY)

AmountChanges(%, YoY)(100 millionsof yen)Changes(%, YoY)

Individual insurance

214

138.3

5,965

72.1

7,678

94.1

(1,713)−

Individual annuities

19

66.9

615

62.9

629

63.6

(13)

−

(1,726)

−

234

127.1

6,581

71.2

8,307

90.8

Group insurance

−

−

209

50.5

209

50.5

Group annuities

−

−

0

304.2

0

304.2

Subtotal

Notes: 1. Number of new policies is the sum of new business and policies after conversion.
2. Amount of new policies for individual annuities, both new business and net increase by conversion, is equal to the funds to be held at the time annuity payments
are to commence.
3. Amount for group annuities is equal to the initial premium payment.

(iii) Surrendered and Lapsed Policies (Individual Insurance and Individual Annuities)
Six months ended
September 30, 2008

Six months ended
September 30, 2009
Changes(%, YoY)

Amount of surrender and lapse(100 millions of yen)

Surrender and lapse ratio (%)

Changes(%, YoY)

10,412

100.3

9,722

93.4

3.01

0.10

2.93

(0.08)

Notes: 1.The amount of lapse is not offset by the amount of reinstatement which was once lapsed.
2.The column of "Changes" of surrender and lapse ratio are increase-decrease points over year.

-1-

Fukoku Mutual Life Insurance Company

(2) Annualized Premiums(i) Policies in Force(100 millions of yen except percentage)

As ofMarch 31, 2009

As of
September 30, 2009
Changes(%, Pre-FYE)

Changes(%, YoY)

Individual insurance

2,991

97.8

3,057

Individual annuities

1,242

100.8

1,233

103.2

Total

4,234

98.7

4,290

96.8

998

101.1

987

100.8

Medical coverage and living benefits

94.5(ii) New Policies(100 millions of yen except percentage)

Six months ended
September 30, 2008

Six months ended
September 30, 2009

Changes(%, YoY)

Changes(%, YoY)

Individual insurance

99

84.5

98

99.3

Individual annuities

43

95.8

30

69.7

Total

142

87.7

128

90.2

36

82.9

44

119.8

Medical coverage and living benefits

Notes: 1. Annualized premiums are calculated by using coefficients based on the premium payment method. (For single premium
contracts, the amount is calculated by dividing the premium by the coverage period.)
2. Figures for medical coverage and living benefits represent portion of annualized premium corresponding to the medical
benefits (hospitalization benefits and surgery benefits, etc.), living benefits (nursing care benefits, etc.) and premium waiver
benefits, in which disability cause is excluded but causes such as specific illness are included.
3. New policies include net increase by conversion.

(3) Selected Items of Statements of Operations(100 millions of yen except percentage)

Six months ended
September 30, 2008

Six months ended
September 30, 2009

Changes(%, YoY)

Premium and other income

Changes(%, YoY)

3,555

91.3

3,104

87.3

672

87.9

793

118.0

3,020

93.6

2,872

95.1

Investment expenses

251

154.9

413

164.2

Ordinary profits

332

97.1

127

38.3

Investment income
Claims and other payments(4) Total Assets(100 millions of yen except percentage)

As ofMarch 31, 2009

As of
September 30, 2009
Changes(%, Pre-FYE)

Total assets

55,668-2-

100.9

Changes(%, YoY)

55,144

96.3

Fukoku Mutual Life Insurance Company

2. Investment Activities of General Account Assets in the First Half of
Fiscal 2009(1) Investment Environment
For the first half of fiscal 2009, Japanese economy rallied against the background of
the recovery of Chinese economy and effects of economic policy in Japan. However,
economic activity, especially production remained at a low level, and continued a severe
situation. On the other hand, the condition of financial and capital markets has beenmoderated by the policy measures of many countries while the concern from the financial
turmoil still existed.
As for the long-term interest rate, 10-year government bond yield once rose above to
1.5% level on in early June, and then turned to downward trend and reached to 1.2% levelon the concern over global economy and strong demand from institutional investors. It
reached to 1.3% at the end of September.
Stock price rose to over 10,000 yen level by the Nikkei Average against the
expectations of economic recovery, and reached to 10,133 yen at the end of September,around 2,000 yen higher than the previous fiscal year end.
Against the euro, the yen remained at 130 yen level, and reached to 131 yen level atthe end of September, almost the same level to the previous fiscal year end. On the other
hand, as the U.S. dollar depreciated under the pessimistic estimates against U.S.
economy and the forecast that the U.S. low interest rate policy would continue, the yen
against the U.S. dollar reached to 90 yen level at the end of September, around 8 yen
higher than the previous fiscal year end.
On the U.S. and European financial markets, both FRB and ECB continued affluent
amount of money supply for the stabilization of financial markets. FRB kept the federal
funds rate at 0.0% to 0.25%, the historical low level. ECB also kept the policy interest rate
at 1% after cutting it to 1% in the middle of May. Under these conditions, long-term interest
rate in U.S., which once rose to 3.9% level, declined to close to 3% at the end of
September. German bund, the indicator of European long-term interest rate, once rose to3.7% level, went down to close to 3.0% level at the end of September.

-3-

Fukoku Mutual Life Insurance Company

(2) Investment Policies
Fundamental policy of asset management of Fukoku Life is to achieve the high level ofinvestment revenue to the future, in accordance with the principle of prudent and profitable
investments, taking into consideration of the liability characteristic of life insurance
products.
Under this policy, we allocate our funds based on medium-to-long term view of themarket to construct a portfolio capable of adequately responding to the ongoingdevelopments. To explain concretely, we diversify our investment in foreign securities,
equities and real estate within the permitted range of risk to improve the revenue, althoughyen-denominated interest bearing assets such as domestic bonds and loans are the coresof the portfolio. Moreover, under the current uncertain conditions in the financial andcapital markets, we make our best effort to secure our customers’ funds.
We limit our investments towards financial products, which lack liquidity or include
obscure risks, to maintain the quality of the portfolio. We also closely monitor our assets
on daily basis to reduce the investment risk, so that we are able to absorb the influence
from the large volatility in the market.
(3) Investment Results
General account assets at the end of the first half of fiscal 2009 were ¥5,450.2 billion(up 0.9% from the previous fiscal year end), an increase of ¥47.3 billion from the end of
the previous fiscal year, by the increase of net unrealized gains on equities.
While the conditions of financial and capital markets have shown some signs ofimprovement, there are still concerns about the future. Under these conditions, we haveshifted our investment assets from high-risk assets to yen-denominated interest bearing
assets to some extent since the latter half of previous year to maintain the safety andliquidity of the assets. More precisely, we increased domestic bonds, especiallygovernment bond while we reduced equities and foreign currency denominated assets.
Also we endeavored to increase revenue by investing in yen-denominated foreign bonds
with relatively high investment yield while replacing the high-risk assets on market trends
from time to time.
As a result, the balance of domestic bonds increased ¥94.5 billion to ¥2,563.3 billion.
The balance of equities increased ¥26.4 billion to ¥445.3 billion on appreciation of net
unrealized gains following the recovery of equity markets, while book price decreased¥35.3 billion.

-4-

Fukoku Mutual Life Insurance Company

The balance of foreign securities increased ¥5.2 billion to ¥579.8 billion mainly on therecovery of the markets while book price decreased ¥7.3 billion.
Real estate increased ¥18.1 billion to ¥264.3 billion due to the proceeding of works on
Osaka Fukoku Seimei Building.
The balance of securitized financial products decreased ¥0.1 billion to ¥9.6 billion. The
ratio of securitized financial products to general account assets is merely 0.18%. As wehave no direct holding of any subprime-related products, the impact on the managementfrom this asset class is very limited.
Total investment income were ¥70.0 billion (up 4.2% from the first half of the previous
fiscal year). Interest and dividends income decreased ¥4.6 billion to ¥54.8 billion (down
7.9%, ditto), mostly on the decrease of balance of foreign bonds and interest from foreign
bonds due to the effect of yen’s appreciation.
Total investment expenses were ¥41.3 billion (up 133.7%, ditto). As we sold high-risk
assets and replaced the securities, losses on sales of securities increased ¥14.9 billion to¥16.4 billion (up 943.8%, ditto).
As a result, the net income of our investment activities which is the amount ofinvestment income minus expenses were ¥28.7 billion (down 42.1%, ditto).

-5-

Fukoku Mutual Life Insurance Company

3. Investment Results of General Account Assets(1) Asset Composition(Millions of yen)
As ofMarch 31, 2009

As of
September 30, 2009
Cash, deposits, call loans
Monetary claims bought
Money held in trust
Securities
Domestic bonds
Domestic stocks
Foreign securities
Foreign bonds
Foreign stocks and other securities
Other securities
Loans
Policy loans
Ordinary loans
Real estate
Deferred tax assets
OthersAllowance for possible loan losses
Total
Foreign currency denominated assets

AmountPercentage
148,210
2.7
1,886
0.0
32,972
0.6
3,639,627
66.8
2,563,342
47.0
445,3658.2
579,849
10.6
412,745
7.6
167,103
3.1
51,0690.9
1,230,487
22.6
75,471
1.4
1,155,015
21.2
264,384
4.9
80,918
1.5
65,717
1.2(13,927)(0.3)
5,450,276
100.0
438,045
8.0

AmountPercentage
206,849
3.8
2,055
0.0
33,0530.6
3,513,882
65.0
2,468,826
45.7
418,8897.8
574,604
10.6
403,391
7.5
171,212
3.2
51,5621.0
1,238,205
22.9
76,9671.4
1,161,237
21.5
246,220
4.6
110,4222.0
63,5471.2(11,290)(0.2)
5,402,946
100.0
441,7108.2

Six months ended
September 30, 2008

Six months ended
September 30, 2009

(2) Changes (Increase/Decrease) in Assets(Millions of yen)Cash, deposits, call loans
Monetary claims bought
Money held in trust
Securities
Domestic bonds
Domestic stocks
Foreign securities

5,201
(443)
(22,421)(70,320)(69,831)(37,542)
27,974
22,644
5,330
9,078(14,965)(1,095)(13,870)
1,739
40,465
3,437
2,596(54,710)(1,047)

Foreign bonds
Foreign stocks and other securities
Other securities
Loans
Policy loans
Ordinary loans
Real estate
Deferred tax assets
OthersAllowance for possible loan losses
Total
Foreign currency denominated assets-6-(58,639)(169)(80)
125,744
94,51526,476
5,244
9,353(4,108)(492)(7,717)(1,496)(6,221)
18,164(29,504)
2,170(2,637)47,330(3,664)

Fukoku Mutual Life Insurance Company

(3) Investment Income(Millions of yen)Six months ended
September 30, 2008

Six months ended
September 30, 2009

59,513272
39,835
12,116

54,836
180
34,635
12,407

Income from real estate for rent
Other interest and dividends
Gains from money held in trust, net
Gains from trading securities, net
Gains on sales of securities

6,866
422
−
−
7,568

7,491
121
−
−
15,125

Gains on sales of domestic bonds
Gains on sales of domestic stocks
Gains on sales of foreign securities
Gains on redemption of securities
Gains from derivative instruments, net

2,033
2,269
3,265
−
−

7,715
7,093
315
−
−

−
157

−
70

67,23970,031

Interest, dividends and other income
Interest from deposits
Interest and dividends from securities
Interest from loans

Foreign exchange gains, net
Other investment income
Total(4) Investment Expenses(Millions of yen)Six months ended
September 30, 2008

Six months ended
September 30, 2009

1,071
2,467

977
92

231
1,579

477
16,485Losses on sales of domestic bonds
Losses on sales of domestic stocks

726
202

89
5,407

Losses on sales of foreign securities
Losses on valuation of securities

650
5,117
−
4,654
463

10,989
1,877
−
1,725
152

−
2,072
752
−
−

−
12,226
972
2,742
−

2,241
2,146
17,6792,595
2,871
41,319Interest expenses
Losses from money held in trust, net
Losses from trading securities, net
Losses on sales of securities

Losses on valuation of domestic bonds
Losses on valuation of domestic stocks
Losses on valuation of foreign securities
Losses on redemption of securities
Losses from derivative instruments, net
Foreign exchange losses, net
Provision for allowance for possible loan losses
Write-off of loans
Depreciation of real estate for rent and other assets
Other investment expenses
Total(5) Net Investment Income(Millions of yen)

Net investment income-7-

Six months ended
September 30, 2008

Six months ended
September 30, 2009

49,56028,712

Fukoku Mutual Life Insurance Company

(6) Net Valuation Gains/Losses on Trading Securities(Millions of yen)

As of March 31, 2009
Net valuation gains/losses
Carrying value on
included in the statements
balance sheetsof operations

As of September 30, 2009
Net valuation gains/losses
Carrying value on
included in the statements
balance sheetsof operations
Trading securities

91,85989,449(1,160)(6,204)

Note: The table above includes money held in trust for trading purpose.

(7) Fair Value Information on Securities (with fair value, other than trading securities)(Millions of yen)

As of March 31, 2009

As of September 30, 2009

Book value

Gains/losses

Fair value

Gains
Held-to-maturity debt securities

Book value

Fair value

Gains/losses

Losses

Gains

Losses146,651

151,719

5,067

5,349

282

152,157

156,525

4,368

5,177

809

Domestic bonds

106,973

111,629

4,656

4,656

−

113,032

117,328

4,296

4,332

36

Foreign bonds

39,67840,089

411

693

282

39,12539,197

71

845

773

Monetary claims bought

−

−

−

−

−

−

−

−

−

−

Negotiable certificate of deposits

−

−

−

−

−

−

−

−

−

−

Others

−

−

−

−

−

−

−

−

−

−

635,925

656,348

20,423

20,52097

628,570644,212

15,641

16,131

489

1,393

937

(455)

−

455

1,393

954

(438)

−

438

2,709,101

2,740,256

31,155

106,468

75,313

2,678,173

2,622,561(55,611)

77,291

132,903

Domestic bonds

1,794,889

1,820,443

25,55329,945

4,391

1,705,656

1,727,224

21,56828,906

7,338

Domestic stocks

367,216

411,266

44,04972,24928,199403,395

385,582(17,813)45,49563,309Foreign securities

503,489

468,390(35,099)

3,180

38,279519,208

466,188(53,020)

2,388

55,408Foreign bonds

328,293

313,179(15,113)2,504

17,617

328,436

306,869(21,567)

1,942

23,509Foreign stocks and other securities

175,196

155,210(19,986)

675

20,662

190,772

159,319(31,452)445

31,89843,50540,155(3,349)

1,092

4,442

49,912

43,566(6,346)

501

6,847

Money held in trust

−

−

−

−

−

−

−

−

−

−

Monetary claims bought

−

−

−

−

−

−

−

−

−

−

Negotiable certificate of deposits

−

−

−

−

−

−

−

−

−

−

Others

−

−

−

−

−

−

−

−

−

−

3,493,071

3,549,260

56,189132,338

76,1493,460,294

3,424,254(36,039)

98,600134,640

Domestic bonds

2,537,788

2,588,421

50,63355,1224,489

2,447,258

2,488,764

41,50649,3707,863

Domestic stocks

367,216

411,266

44,04972,24928,199403,395

385,582(17,813)45,49563,309Foreign securities

544,561

509,417(35,144)

3,873

39,017559,727

506,341(53,386)

3,233

56,619Foreign bonds

367,971353,269(14,702)

3,197

17,899367,562

346,066(21,495)

2,787

24,283Foreign stocks and other securities

176,589

156,147(20,441)

675

21,117

192,165

160,274(31,891)445

32,33643,50540,155(3,349)

1,092

4,442

49,912

43,566(6,346)

501

6,847

Money held in trust

−

−

−

−

−

−

−

−

−

−

Monetary claims bought

−

−

−

−

−

−

−

−

−

−

Negotiable certificate of deposits

−

−

−

−

−

−

−

−

−

−

Others

−

−

−

−

−

−

−

−

−

−

Policy-reserve-matching bonds
Investments in subsidiaries and affiliates
Available-for-sale securities

Other securities

Total

Other securities

Note: The table above includes assets, such as negotiable certificate of deposits, which are considered appropriate to deem as securities under the Financial Instruments and Exchange Law.

* Book value of securities without fair value are as follows:(Millions of yen)
As ofMarch 31, 2009

As of
September 30, 2009
Held-to-maturity debt securities−−

Unlisted foreign bonds−−

Others−−−−Investments in subsidiaries and affiliates

26,132

26,132Available-for-sale securities

Policy-reserve-matching bonds

29,381

25,671

Unlisted domestic stocks (except over-the-counter stocks)

7,967

7,174

Unlisted foreign stocks (except over-the-counter stocks)

500

500

Unlisted foreign bonds
Others
Total

-8-

−

−

20,914

17,99655,51351,803

Fukoku Mutual Life Insurance Company

(8) Fair Value Information on Money Held in Trust(Millions of yen)
As of March 31, 2009

As of September 30, 2009
Carrying
value onbalancesheetsMoney held in trust

32,972Carrying
value onbalancesheetsGains/losses
Fair value

32,972

Gains−

Losses−−

33,053

Gains/losses
Fair value

33,053

Gains−

Losses−−* Money held in trust for trading purpose(Millions of yen)
As of March 31, 2009

As of September 30, 2009
Net valuation gains/losses
included in the statementsof operations

Carrying value onbalance sheets
Money held in trust
for trading purpose

31,972

Net valuation gains/losses
included in the statementsof operations

Carrying value onbalance sheets

32,05322520* Money held in trust classified as held-to-maturity, policy-reserve-matching and available-for-sale(Millions of yen)
As of March 31, 2009

As of September 30, 2009
Book value Fair value

Gains/losses
Gains

Book value Fair value

LossesGains/losses
Gains

LossesMoney held in trust
for held-to-maturity

−

−

−

−

−

−

−

−

−

−

Money held in trust
for policy-reserve-matching

−

−

−

−

−

−

−

−

−

−

Money held in trust
for available-for-sale

−

−

−

−

−

−

−

−

−

−

-9-

Fukoku Mutual Life Insurance Company

(reference) Fair Value Information on Derivative Instruments (General Account)(i) Gains and Losses on Derivatives(millions of yen)Interestrelated

Currencyrelated

884

3,539

−

−

−

−

390

86

(57)

−

419

884

3,930

86

(57)

−

4,843

As of March 31, 2009

Interestrelated

Currencyrelated

Stockrelated

Hedge accounting applied

751

(954)

As of September 30, 2009
Hedge accounting applied
Hedge accounting not applied
Total

Hedge accounting not applied
Total

Stockrelated

Bondrelated

Bondrelated−−

OthersOthers
−

Total
4,424

Total
(203)

−

(2,393)(4,600)−−(6,993)751(3,347)(4,600)−−(7,197)

Note: Gains and losses from applying fair value hedge accounting (currency related, losses of \952 million as of March 31, 2009 and gains of \3,539 million
as of September 30, 2009) included in gains and losses with hedge accounting applied, and gains and losses with hedge accounting not applied arereported in the statements of operations.

(ii) Interest-related Transactions(millions of yen)
As of March 31, 2009

As of September 30, 2009
Notional amount/contract valueOver
1 yearFair
value

Notional amount/contract value

Gains(losses)Over
1 year

Fair
value

Gains
(losses)Over-the-counter transactions
Interest rate swap contracts
Receipt fixed, payment floating

67,051

46,651

916

Payment fixed, receipt floating

2,500

2,500

(32)

Total

916

71,05866,738

789

(32)

2,500

2,500

(38)

884

789
(38)
751

* Interest rate swap contracts by contractual maturity dates(millions of yen)
As of March 31, 2009

As of September 30, 2009

Notional amount(receipts fixed, payments floating)

1 year or
shorterOver
1 year to
3 years

20,40030,438Over
3 years
16,212

1 year or
shorterOver
1 year to
3 years

4,320

44,623Over
3 years
22,115

Average fixed rate (receipt)

1.14%

1.39%

1.84%

1.26%

1.25%

1.80%

Average floating rate (payment)

0.72%

0.72%

1.08%

1.24%

0.94%

1.27%

Notional amount(receipts floating, payments fixed )

−

2,500

−

−

2,500

−

Average floating rate (receipt)

−

0.84%

−

−

1.05%

−

Average fixed rate (payment)

−

1.84%

−

−

1.84%

−

- 10 -

Fukoku Mutual Life Insurance Company

(iii) Currency-related Transactions(millions of yen)
As of March 31, 2009
Notional amount/
Fair
Gains
contract value
value(losses)Over
1 yearAs of September 30, 2009
Notional amount/
Fair
Gains
contract value
value(losses)Over
1 yearOver-the-counter transactions
Currency forward contracts
Sold
US dollar
Euro
Australian dollar
Bought214,904
133,333
67,11814,453−Currency Options
Sold
Calls
[
US dollar[
Australian dollar
[
Euro
[
Puts
[
Bought
Calls
[
Puts
[
US dollar[
Australian dollar[
Euro[
Currency swap contracts
Australian dollar− 211,020− 130,004− 66,502− 14,514
−
−

9,519
60 ]
9,519
60 ]
−
−]
−
−]
−
−]

−

−
−]
9,000
60 ]
9,000
60 ]
−
−]
−
−]

−

4,000
4,000

0

3,883
3,329
616
(61)
−

60

[

−
0

60

[

−
−

−

[

−
−

−

[

−
−

−

[

−

−

[

− 216,725− 125,222− 91,503−−−−

61,583653 ]
43,449395 ]
12,534
219 ]
5,600
39 ]
−
−]

−

−

−

−

−
−]
57,040653 ]
40,550395 ]
11,400
219 ]
5,090
39

(31)
(31)

(31)
(31)

4,000
4,000

−
77

17

[

−
77

17

[

−
−

−

[

−

−
−

214,060
124,325
89,734−−

Total(2,665)(896)(1,768)
−
−

861

(207)

232

162

601

(382)

27

12

−

−

−

−

237

(416)

191

(203)

4

(214)

41

1

(58)
(58)

(58)
(58)

−
−
−
−

−
−
−
−

4,000
4,000

3,930

(3,347)

Notes: 1. Figures in [ ] are option premiums which are included in balance sheets.
2. Forward exchange rates are used for exchange rates as of the end of period.
3. Regarding assets and liabilities which are denominated in foreign currencies but have fixed settlement in yen under currency forward contracts and arereported in yen amounts in the balance sheets, those currency forward contracts are excluded from the table above.

(iv) Stock-related Transactions(millions of yen)
As of March 31, 2009
Notional amount/contract value
Gains
Fair value(losses)Over
1 yearAs of September 30, 2009
Notional amount/contract value
Gains
Fair value(losses)Over
1 yearExchange-traded transactions
Yen stock index futures
Sold
Bought23,326−

Stock index options
Sold
Calls
[
Puts
[
Bought
Calls
[
Puts
[

−
−

−
− ]
−
− ]

−

−
− ]
28,000433 ]−

22,959
−

366
−

−

−

38,703
−

[

−
−

−

[

−

−

[

−
152

Total

(280)
86

[

−
−

−
− ]
−
− ]

−

−
− ]
−
− ]

−

43,303−(4,600)
−

−

−

−

−

−

−

−

−

−

−

(4,600)Note: Figures in [ ] are option premiums which are included in balance sheets.

- 11 -

Fukoku Mutual Life Insurance Company

(v) Bond-related Transactions(millions of yen)
As of September 30, 2009
Notional amount/contract value

Notional amount/contract value

Gains(losses)

Fair valueOver
1 yearAs of March 31, 2009

Fair valueOver
1 yearGains(losses)

Exchange-tradedtransactions
Yen bond futures
Sold
Bought−−27,810−27,868
−

−
−

(57)
−

−
−

−
−

(57)

Total

−
−
−

(reference) Fair Value of Real Estate ( Land and Leaseholds)(millions of yen)
As of September 30, 2009
Carrying value on
the balance sheets
155,195

Fair value
276,406

As of March 31, 2009
Carrying value on
the balance sheets

Gains(losses)
121,211

Fair value

142,001

269,274

Gains(losses)
127,273

Notes: 1. As of September 30, 2009, fair value is based on the appraisal value by the real-estate appraiser, the appraisal value for property tax and the road rate as of January 1, 2009.
2. As of March 31, 2009, fair value is based on the appraisal value by the real-estate appraiser, the appraisal value for property tax as of January 1, 2009 and the road rate
as of January 1, 2008.

- 12 -

Fukoku Mutual Life Insurance Company

4. Non-consolidated Balance Sheets(Millions of yen)

Assets:Cash and deposits
Call loans
Monetary claims bought
Money held in trust
Securities[Government bonds][Local government bonds][Corporate bonds][Stocks][Foreign securities]
Loans
Policy loans
Ordinary loans
Tangible fixed assets
Intangible fixed assets
Reinsurance receivables
Other assets
Deferred tax assets
Allowance for possible loan losses

As of September 30, 2009

As of March 31, 2009

AmountAmount46,521
127,100
1,886
32,972
3,729,072[1,845,705][134,914][616,953][477,302][602,561]
1,230,487
75,471
1,155,015
268,032
7,592
11
56,17080,918(13,927)

49,382
183,600
2,055
33,0533,596,377[1,746,556][136,848][616,227][448,295][596,372]
1,238,205
76,967
1,161,237
250,065
7,785
122
54,674110,422(11,290)

5,566,838

5,514,454

5,229,679
23,9785,140,894
64,80785
39,44033,9391,918
32,02049,46325,53920,034

5,221,451
28,2205,135,913
57,31787
38,87039,550107
39,442
49,29324,622
20,026

Total liabilities
Net assets:
Foundation funds
Accumulated foundation funds redeemed
Reserve for revaluation
Surplus
Legal reserve for future losses
Other surplus
Reserve for redemption of foundation funds
Reserve for dividend allowances
Reserve for advanced depreciation of real estate for tax purpose
Other reserves
Unappropriated surplus
Total foundation funds and surplus
Net unrealized gains (losses) on available-for-sale securities, net of tax
Deferred valuation gains (losses) under hedge accounting
Revaluation reserve for land, net of tax
Total valuation and translation adjustments

5,398,182

5,393,901

40,00046,000112
61,2302,187
59,042
15,000
3,895
303
767
39,076
147,342
19,873577
861
21,31240,00031,000112
83,621
1,987
81,63420,000
3,895
311
767
56,660154,733(35,474)479
814(34,180)

Total net assets
Total liabilities and net assets

168,655
5,566,838

120,553
5,514,454

Total assets
Liabilities:
Policy reserves
Reserve for outstanding claims
Policy reserve
Reserve for dividends to policyholders
Reinsurance payables
Subordinated bonds
Other liabilities
Corporate income tax payable
Other liabilities
Reserve for employees' retirement benefits
Reserve for price fluctuation of securities
Deferred tax liabilities for revaluation reserve for land

- 13 -

Fukoku Mutual Life Insurance Company

5. Non-consolidated Statements of Operations(Millions of yen)

Ordinary revenues:
Premium and other income[Premium income]Six months ended

Six months ended

September 30, 2008
AmountSeptember 30, 2009
Amount355,524[355,486]

Investment income

310,477[310,459]

67,23979,313[Interest, dividends and other income][59,513][54,836][Gains on sales of securities][7,568][15,125][Gains from separate accounts, net]
Other ordinary revenues[−]
15,131[9,281]
11,495[Reversal of reserve for outstanding claims]
Total ordinary revenues
Ordinary expenditures:
Claims and other payments[Claims][Annuities][Benefits][Surrenders][Other payments]
Provision for policy reserve and others
Provision for policy reserve
Interest on accumulated dividends to policyholders
Investment expenses[Interest expenses][Losses from money held in trust, net]
[Losses from trading securities, net]
[Losses on sales of securities][Losses on valuation of securities][Losses from derivative instruments, net]
[Losses from separate accounts, net]
Operating expenses
Other ordinary expenditures
Total ordinary expenditures
Ordinary profits
Extraordinary gains:
Gains on disposal of fixed assets
Reversal of allowance for possible loan losses
Total extraordinary gains
Extraordinary losses:
Losses on disposal of fixed assets
Impairment losses
Provision for reserve for price fluctuation of securities
Total extraordinary losses
Surplus before income taxes
Income taxes:
Current
Deferred
Total income taxes
Net surplus for the period- 14 -[2,510][4,241]

437,895

401,286

302,067[124,527][42,393][73,950][49,250][11,791]
21,947
21,817
129
25,158[1,071][2,467][231][1,579][5,117][2,072][7,478]42,828
12,610287,252[111,491][42,385][73,483][45,928][13,812]
5,060
4,980
79
41,319
[977]
[92]
[477]
[16,485][1,877][12,226][−]
43,316
11,595

404,61233,283

388,544
12,742

−
2,556

277

2,556

−
277

62
75
1,078

29
184
917

1,216
34,622

1,131
11,888

8,921(1,948)
6,972

2,621
(1,958)662

27,650

11,225

Fukoku Mutual Life Insurance Company

6. Non-consolidated Statements of Changes in Net Assets(Millions of yen)

For the six months ended For the six months ended
September 30, 2008
September 30, 2009
Foundation funds and surplus
Foundation funds
Balance at the end of previous fiscal year

40,00040,000−−−40,00015,000(15,000)−
40,00031,00031,000−−31,00015,00015,00046,000

112

112

−
112

−
112

1,787

1,987

200
200
1,987

200
200
2,187

10,00020,00010,000−10,00020,00010,000(15,000)(5,000)15,000

3,895

3,895

−
3,895

−
3,895

319

311

(8)
(8)
311

(7)
(7)
303

767

767

−
767

−
767

55,671

56,660(31,868)
(200)
(716)
27,650(10,000)
8
32(15,094)
40,577(17,856)
(200)
(716)
11,225(10,000)7(43)(17,583)
39,076

Changes in the current period
Financing of additional foundation funds
Redemption of foundation funds
Total changes in the current period
Balance at the end of current period
Accumulated foundation funds redeemed
Balance at the end of previous fiscal year
Changes in the current period
Additions to accumulated foundation funds redeemed
Total changes in the current period
Balance at the end of current period
Reserve for revaluation
Balance at the end of previous fiscal year
Changes in the current period
Total changes in the current period
Balance at the end of current period
Surplus
Legal reserve for future losses
Balance at the end of previous fiscal year
Changes in the current period
Additions to legal reserve for future losses
Total changes in the current period
Balance at the end of current period
Other surplus
Reserve for redemption of foundation funds
Balance at the end of previous fiscal year
Changes in the current period
Additions to reserve for redemption of foundation funds
Reversal of reserve for redemption of foundation funds
Total changes in the current period
Balance at the end of current period
Reserve for dividend allowances
Balance at the end of previous fiscal year
Changes in the current period
Total changes in the current period
Balance at the end of current period
Reserve for advanced depreciation of real estate for tax purpose
Balance at the end of previous fiscal year
Changes in the current period
Reversal of reserve for advanced depreciation of real estate for tax purpose
Total changes in the current period
Balance at the end of current period
Other reserves
Balance at the end of previous fiscal year
Changes in the current period
Total changes in the current period
Balance at the end of current period
Unappropriated surplus
Balance at the end of previous fiscal year
Changes in the current period
Additions to reserve for dividends to policyholders
Additions to legal reserve for future losses
Payment of interest on foundation funds
Net surplus for the current period
Additions to reserve for redemption of foundation funds
Reversal of reserve for advanced depreciation of real estate for tax purpose
Reversal of revaluation reserve for land
Total changes in the current period
Balance at the end of current period- 15 -

Fukoku Mutual Life Insurance Company

6. Non-consolidated Statements of Changes in Net Assets (Continued)(Millions of yen)

For the six months ended For the six months ended
September 30, 2008
September 30, 2009
Total surplus
Balance at the end of previous fiscal year

72,441

83,621(31,868)(716)
27,650−32(4,902)
67,538(17,856)(716)
11,225(15,000)(43)(22,391)
61,230143,553

154,733−(31,868)−(716)
27,650−−32(4,902)
138,650

15,000(17,856)
15,000(716)
11,225(15,000)(15,000)(43)(7,391)
147,342

115,334(35,474)(67,521)(67,521)47,81355,34855,34819,873

408

479

(365)
(365)
42

98
98
577

(12,335)

814

(32)
(32)
(12,367)

46
46
861

103,407(34,180)(67,918)(67,918)
35,48855,49355,493
21,312

246,961

120,553−(31,868)−(716)
27,650−−32(67,918)(72,821)
174,139

15,000(17,856)
15,000(716)
11,225(15,000)(15,000)(43)
55,493
48,102
168,655

Changes in the current period
Additions to reserve for dividends to policyholders
Payment of interest on foundation funds
Net surplus for the current period
Reversal of reserve for redemption of foundation funds
Reversal of revaluation reserve for land
Total changes in the current period
Balance at the end of current period
Total foundation funds and surplus
Balance at the end of previous fiscal year
Changes in the current period
Financing of additional foundation funds
Additions to reserve for dividends to policyholders
Additions to accumulated foundation funds redeemed
Payment of interest on foundation funds
Net surplus for the current period
Redemption of foundation funds
Reversal of reserve for redemption of foundation funds
Reversal of revaluation reserve for land
Total changes in the current period
Balance at the end of current period
Valuation and translation adjustments
Net unrealized gains (losses) on available-for-sale securities, net of tax
Balance at the end of previous fiscal year
Changes in the current period
Net changes, excluding foundation funds and surplus
Total changes in the current period
Balance at the end of current period
Deferred valuation gains (losses) under hedge accounting
Balance at the end of previous fiscal year
Changes in the current period
Net changes, excluding foundation funds and surplus
Total changes in the current period
Balance at the end of current period
Revaluation reserve for land, net of tax
Balance at the end of previous fiscal year
Changes in the current period
Net changes, excluding foundation funds and surplus
Total changes in the current period
Balance at the end of current period
Total valuation and translation adjustments
Balance at the end of previous fiscal year
Changes in the current period
Net changes, excluding foundation funds and surplus
Total changes in the current period
Balance at the end of current period
Total net assets
Balance at the end of previous fiscal year
Changes in the current period
Financing of additional foundation funds
Additions to reserve for dividends to policyholders
Additions to accumulated foundation funds redeemed
Payment of interest on foundation funds
Net surplus for the current period
Redemption of foundation funds
Reversal of reserve for redemption of foundation funds
Reversal of revaluation reserve for land
Net changes, excluding foundation funds and surplus
Total changes in the current period
Balance at the end of current period- 16 -

Fukoku Mutual Life Insurance Company

Notes to the Non-consolidated Financial Statements
I. Presentation of the Non-consolidated Financial Statements
1. Basis of Presentation
The accompanying non-consolidated financial statements have been prepared from the accounts
maintained by Fukoku Mutual Life Insurance Company (the “Company”) in accordance with theprovisions set forth in the Insurance Business Law of Japan and its related rules and regulations andin conformity with accounting principles generally accepted in Japan, which are different in certain
respects from accounting principles generally accepted in countries and jurisdictions other than Japan.
In addition, the notes to the non-consolidated financial statements include information which is not
required under accounting principles generally accepted in Japan but is presented herein as additional
information.
Amounts of less than one million yen have been eliminated. As a result, total in yen shown herein do
not necessarily agree with the sum of the individual amounts.

II. Notes to the Non-consolidated Balance Sheet
1. Significant Accounting Policies(1) Valuation Methods of Securities
The valuation of securities, including bank deposits and monetary claims bought which are equivalent
to securities, and securities managed as trust assets in money held in trust, is as follows:i)

Trading securities are stated at fair market value. Costs of their sales are determined by themoving average method.

ii)

Held-to-maturity debt securities are stated at amortized cost under the straight-line method,
cost being determined by the moving average method.

iii)

Policy-reserve-matching bonds are stated at amortized cost under the straight-line method,
cost being determined by the moving average method in accordance with “Temporary
Treatment of Accounting and Auditing Concerning Policy-reserve-matching Bonds inInsurance Industry” (Industry Audit Committee Report No.21 issued by the Japanese Instituteof Certified Public Accountants on November 16, 2000).

iv)

Investments in subsidiaries and affiliates are stated at cost, cost being determined by themoving average method.

v)

Available-for-sale securities with fair market value are stated at fair market value based on
the market prices at the balance sheet date. Costs of their sales are determined by themoving average method. Net unrealized gains or losses on these available-for-sale securities,
net of taxes, are recorded as a separate component of net assets.
Available-for-sale securities with no fair market value are stated at cost, cost being
determined by the moving average method, except for public and corporate bonds including
foreign bonds, of which the difference between acquisition cost and face value is considered
to be an adjustment of interest. Such bonds are stated at amortized cost under the straightline method, cost being determined by the moving average method.

(2) Valuation Methods of Derivative Instruments
Derivative instruments are stated at fair market value.
(3) Revaluation of Land
The Company revalued the land for business purposes based on the Law for Revaluation of Land
(Law No.34 promulgated on March 31, 1998). The difference between fair value and book value
resulting from the revaluation, net of related taxes, is recorded as revaluation reserve for land as a

- 17 -

Fukoku Mutual Life Insurance Company

separate component of net assets and the related tax is recorded as deferred tax liabilities forrevaluation reserve for land.
• Date of revaluation: March 31, 2002
• Method of revaluation as prescribed for in Article 3 Paragraph 3 of the said Law:
Calculation is based on the appraisal value for property tax set forth in Article 2 item 3 of the
Enforcement Ordinance of the Law for Revaluation of Land (Government Ordinance No.119
promulgated on March 31, 1998) and the road rate set forth in Article 2 item 4 of the said
Ordinance with certain reasonable adjustments.
(4) Depreciation of Tangible Fixed Assets
Depreciation of tangible fixed assets is calculated by the following methods.
• Buildings (excluding lease assets)i)

Acquired on or before March 31, 1998: Previous declining-balance methodii)

Acquired on or after April 1, 1998 but on or before March 31, 2007: Previous straight-line
methodiii)

Acquired on or after April 1, 2007: Straight-line method• Assets other than buildings (excluding lease assets)i)

Acquired on or before March 31, 2007: Previous declining-balance methodii)

Acquired on or after April 1, 2007: Declining-balance method• Lease assets related to finance lease transactions that do not transfer ownership: Straight-line
method over the lease term
Other tangible fixed assets acquired for ¥100,000 or more but less than ¥200,000 are depreciatedequally over three years.
(5) Foreign Currency Translation
Foreign currency-denominated assets and liabilities, except for investments in subsidiaries andaffiliates, are translated into Japanese yen at the effective exchange rate prevailing at the balance
sheet date. Investments in subsidiaries and affiliates are translated into Japanese yen at the exchange
rate on the date of acquisition.
(6) Allowance for Possible Loan Losses
Allowance for possible loan losses is provided in accordance with the Company’s standards of selfassessment and write-offs and reserves on credit quality:i)

For the credits of borrowers who are legally bankrupt such as being in the proceedings ofbankruptcy or civil rehabilitation (hereinafter called “legally bankrupt borrowers”) and who aresubstantially bankrupt (hereinafter called “substantially bankrupt borrowers”), the Company
provides the remaining amount of credits after the direct write-off described below and the
deductions of the amount expected to be collected through the disposal of collateral or the
execution of guarantees.

ii)

For the credits of borrowers who are not currently bankrupt but have a high possibility ofbankruptcy, the Company provides the amounts deemed as necessary considering theborrowers’ ability to pay, within the amounts after deductions of the amount expected to becollected through the disposal of collateral or the execution of guarantees.

iii)

For the credits of borrowers other than the above, the Company provides the amounts
calculated by multiplying the borrowers’ balance by the actual ratio of bad debt losses on
defaults during a certain past period.

All credits are assessed by the relevant departments in accordance with the Company’s standards ofself-assessment on credit quality. The results of the assessment are reviewed by the audit department,- 18 -

Fukoku Mutual Life Insurance Company

which is independent of business-related divisions. Subsequently, the allowance for possible loan
losses are provided based on the results of these assessments.
For the credits of legally bankrupt borrowers and substantially bankrupt borrowers, the amounts
remaining after deductions of collateral value or the amounts collectible through the execution ofguarantees is written-off directly from the borrower’s balance as the estimated uncollectible amounts.
The amount written-off as of September 30, 2009 was ¥943 million.
(7) Reserve for Employees’ Retirement Benefits
The Company adopts accounting standards for employees' retirement benefits (Business Accounting
Council dated June 16, 1998) and accounts for the reserve for employees’ retirement benefits basedon the projected benefit obligation and plan assets at the balance sheet date.
(8) Reserve for Price Fluctuation of Securities
Reserve for price fluctuation of securities is calculated in accordance with Article 115 of the Insurance
Business Law.
(9) Lease Transactions as a Lessee
Finance lease transactions that do not transfer ownership to the lessee whose commencement day
was on or before March 31, 2008 continued to be accounted for in a manner similar to accounting
treatment for ordinary rental transactions.
(10) Lease Transactions as a Lessor
For the finance lease transactions where the Company is a lessor, the lease fee is recorded in“interest, dividends and other income” at the time of receiving lease fee. The corresponding cost of thelease assets is recorded in “investment expenses”, which is calculated by deducting an amountequivalent to the interest allocated over the lease term from the lease fee received.
(11) Accounting for Hedge Activities
Hedge accounting is based on “Accounting Standards for Financial Instruments” (ASBJ Statement
No.10 issued by the Accounting Standards Board of Japan on August 11, 2006).
For the foreign currency forward contracts against the exchange rate fluctuations in the value of
foreign currency-denominated bonds classified as available-for-sale securities, which qualify for hedge
accounting because of high correlation and effectiveness between the hedging instruments and thehedged item, valuation gains and losses on the foreign currency forward contracts are recorded in thestatements of operations.
For the interest rate swaps against the interest rate fluctuations regarding loans, which qualify forhedge accounting because of high correlation and effectiveness between the hedging instruments andthe hedged item, valuation gains and losses on the interest rate swaps are deferred until the maturityof the hedged transactions.
Deposits denominated in foreign currencies for which forward foreign exchange contracts areused to hedge the foreign currency fluctuations are translated at the contract rates if the forward
contracts qualify for specific hedge accounting. In this case, exchange differences between exchange
rate on trade date and forward contract rate are allocated to each fiscal year from the date contracted
to the date settled.
For judging the effectiveness of hedge used, ratio analysis of comparing the fluctuations in the fairvalue or cash flows of hedged items and hedging instruments is mostly applied.
(12) Accounting for Consumption Taxes
The Company accounts for consumption taxes by the tax-exclusion method. The consumption taxes
on certain assets, which are not deductible from consumption taxes withheld and that are stipulated to
be deferred under the Tax Law, are deferred as other assets and amortized equally over five years.

- 19 -

Fukoku Mutual Life Insurance Company

Consumption taxes other than deferred consumption taxes are recognized as an expense whenincurred.
(13) Policy Reserve
Policy reserve is based on Article 116 of the Insurance Business Law, and the premium reserve at thebalance sheet date is calculated by the following method:
In regard to the policies subject to the standard policy reserve, the method as prescribed by theCommissioner of Financial Services Agency (Ministry of Finance Ordinance No. 48, 1996) is applied.
In regard to the policies not subject to the standard policy reserve, the net level premium method
is applied.
(14) Software
The software for internal use is amortized based on straight-line method over the estimated useful
lives.
(15) Deferred Assets
Discount on bonds is amortized equally over the period for which interest on bonds is fixed. This
amount is deducted from bonds.
(16) Policy-reserve-matching Bonds
Of the bonds corresponding to the sub-groups which are set by insurance types and investment
policies, the bonds that are held to match the duration of liabilities are classified as policy-reservematching bonds in accordance with “Temporary Treatment of Accounting and Auditing Concerning
Policy-reserve-matching Bonds in Insurance Industry” (Industry Audit Committee Report No.21 issued
by the Japanese Institute of Certified Public Accountants on November 16, 2000).
The amount of policy-reserve-matching bonds recorded on the balance sheet and the market value ofthese bonds as of September 30, 2009 were ¥635,925 million and ¥656,348 million, respectively.
2. Loans Receivable
The amounts of credits to bankrupt borrowers and delinquent loans, which were included in loans,
were ¥412 million and ¥10,434 million, respectively and their total amounts were ¥10,846 million as of
September 30, 2009. There were no balances of delinquent loans past 3 months or more andrestructured loans as of September 30, 2009.
The direct write-offs related to loans decreased credits to bankrupt borrowers by ¥65 million anddelinquent loans by ¥877 million as of September 30, 2009.
Credits to bankrupt borrowers represent loans, excluding the balances already written-off, whichmeet the conditions prescribed in Article 96 Paragraph 1 Item 3 and 4 of the Enforcement Regulationsof the Corporate Tax Law. Moreover, accruing interest of these loans is not recorded as income after
determining that principal of or interest on these loans is unlikely to be collected due to the significant
delay in repayment of principal or interest payment or for some other reasons.
Delinquent loans are credits whose accruing interest is not recorded as income due to the same
reasons as described above, and exclude credits to bankrupt borrowers and loans for which interest
payments have been suspended and rescheduled to assist and support the borrowers in the
restructuring of their business.
Delinquent loans past 3 months or more are loans for which interest payment or repayment ofprincipal are delinquent for 3 months or more from the due date under the terms of the related loan
agreements, excluding those loans classified as credits to bankrupt borrowers and delinquent loans.
Restructured loans are loans for which certain concessions favorable to borrowers, such as
interest reduction or exemptions, rescheduling of due date of principal or interest payment, waiver ofclaim or other terms, have been negotiated for the purpose of assisting and supporting the borrowers- 20 -

Fukoku Mutual Life Insurance Company

in the restructuring of their business. This category excludes loans classified as credits to bankrupt
borrowers, delinquent loans and delinquent loans past 3 months or more.
3. Accumulated Depreciation of Tangible Fixed Assets
Accumulated depreciation of tangible fixed assets totaled to ¥127,159 million as of September 30,
2009.
4. Separate Accounts
Total assets in separate accounts provided for in Article 118 of the Insurance Business Law were
¥117,760 million as of September 30, 2009. The amount of separate account liabilities was the sameas separate account assets.
5. Reserve for Dividends to Policyholders
Changes in reserve for dividends to policyholders for the six months ended September 30, 2009 wereas follows:(Millions of yen)
Balance at the end of previous fiscal year........
Transfer from surplus in previous fiscal year ....
Dividends paid in the current period .................
Increase in interest ...........................................
Balance at the end of the current period ..........

¥57,317
17,856(10,447 )79¥64,807

6. Stocks of Subsidiaries
The amount of stocks of subsidiaries the Company held as of September 30, 2009 was ¥27,525
million.
7. Pledged Assets and Secured Debts
Assets pledged as collateral as of September 30, 2009 were ¥21,003 million of securities and ¥71
million of money held in trust. Secured debts as of September 30, 2009 were ¥4,615 million.
8. Policy Reserves for the Reinsurance Contracts
Reserve for outstanding claims for the reinsurance contracts provided in accordance with Article 71
Paragraph 1 of the Enforcement Regulation of the Insurance Business Law (hereinafter called“reserve for outstanding claims for ceded reinsurance”) was ¥31 million as of September 30, 2009.
Policy reserve for the reinsurance contracts provided in accordance with Article 71 Paragraph 1 of
the Enforcement Regulation of the Insurance Business Law (hereinafter called “policy reserve forceded reinsurance”) was ¥33 million as of September 30, 2009.
9. Additional Foundation Funds
The Company raised additional foundation funds of ¥15,000 million during the six months ended
September 30, 2009 in accordance with Article 60 of the Insurance Business Law.
10. Redemption of Foundation Funds
In the six months ended September 30, 2009, in connection with the redemption of foundation funds of¥15,000 million, the Company reversed the reserve for redemption of foundation funds and provided
the equivalent amount for accumulated foundation funds redeemed in accordance with Article 56 of
the Insurance Business Law.
11. Commitment LineAs of September 30, 2009, there were unused commitment line agreements under which theCompany is the lender of ¥1,981 million.

- 21 -

Fukoku Mutual Life Insurance Company

12. Subordinated Bonds
Repayments of subordinated bonds are subordinated to other obligations.
13. Contribution to Policyholders Protection Corporation
The future contribution to the Life Insurance Policyholders Protection Corporation of Japan under
Article 259 of the Insurance Business Law was estimated at ¥10,654 million as of September 30, 2009.
The contribution was charged as operating expenses in the year in which it was paid.

III. Notes to the Non-consolidated Statement of Operations
1. Gains on Sales of Securities
Major items of gains on sales of securities for the six months ended September 30, 2009 were as
follows:(Millions of yen)Domestic bonds ..........................................
Domestic stocks and others........................
Foreign securities .......................................

¥ 7,715
7,093
315

2. Losses on Sales of Securities
Major items of losses on sales of securities for the six months ended September 30, 2009 were as
follows:(Millions of yen)Domestic bonds ..........................................
Domestic stocks and others........................
Foreign securities .......................................

¥

89
5,407
10,989

3. Losses on Valuation of Securities
Major items of losses on valuation of securities for the six months ended September 30, 2009 were as
follows:(Millions of yen)Domestic stocks and others........................
Foreign securities .......................................

¥ 1,725
152

4. Policy Reserves for the Reinsurance Contracts
For the six months ended September 30, 2009, reversal of reserve for outstanding claims for ceded
reinsurance considered in calculation of reversal of reserve for outstanding claims was ¥24 million andprovision for policy reserve for ceded reinsurance considered in calculation of provision for policy
reserve was ¥3 million.
5. Interest, Dividends and Other Income
Breakdown of interest, dividends and other income for the six months ended September 30, 2009 was
as follows:(Millions of yen)Interest on deposits ....................................
Interest and dividends on securities ...........
Interest on loans .........................................
Income from real estate for rent..................
Other interest and dividends.......................
Total ............................................................

¥

180
34,635
12,407
7,491
121¥54,836- 22 -

Fukoku Mutual Life Insurance Company

7. Breakdown of Ordinary Profits (Fundamental Profit)
Six months ended
September 30, 2008

(Millions of Yen)
Six months ended
September 30, 2009A

40,31932,947

Capital gains
Gains from money held in trust, net
Gains from trading securities, net
Gains on sales of securities
Gains from derivative instruments, net
Foreign exchange gains, net
Other capital gains
Capital losses
Losses from money held in trust, net
Losses from trading securities, net
Losses on sales of securities
Losses on valuation of securities
Losses from derivative instruments, net
Foreign exchange losses, net
Other capital losses
Net capital gains (losses)
B
Fundamental profit plus net capital gains (losses)
A+B
Other one-time gains
Reinsurance income
Reversal of contingency reserve
OthersOther one-time losses
Reinsurance premiums
Provision for contingency reserve
Provision for specific allowance for possible loan losses
Allowance for specified overseas loans
Write-off of loans
OthersOther one-time gains (losses)
C
Ordinary profits
A+B+C

7,568
－
－
7,568
－
－
－
14,192
2,872
1,798
1,579
5,117
2,072
752
－
(6,624)33,695
－
－
－
－
411
－
411
－
－
－
－
(411)
33,283

15,125－－
15,125－－－33,417174
1,680
16,485
1,877
12,226972－(18,292)
14,655
－
－
－
－
1,913
－
288
1,625
－
－
－
(1,913)
12,742Fundamental profit

Notes: 1. The following amounts in respect of gains / losses from money held in trust have been excluded from capital gains / losses andincluded in fundamental profit due to their income nature (being interest and dividend income): ¥404 million in respect of the six
months ended September 30, 2008 and ¥81 million in respect of the six months ended September 30, 2009.
2. The following amounts in respect of gains / losses from trading securities have been excluded from capital gains / losses andincluded in fundamental profit due to the their income nature (being interest and dividend income): ¥1,566 million in respect of
the aix months ended September 30, 2008 and ¥1,203 million in respect of the six months ended September 30, 2009.

Breakdown of Fundamental Profit

Fundamental profit
Loading profit
Mortality and morbidity profit
Negative spread- 23 -

Six months ended
September 30, 2008(100 millions of yen)Six months ended
September 30, 2009

403
63
369
(29)

329
38
385
(94)

Fukoku Mutual Life Insurance Company

8. Disclosed Claims Based on Categories of Obligors
As ofSeptember 30, 2009
737
10,120−10,858[0.88%]
1,225,841
1,236,700

Claims against bankrupt and quasi-bankrupt obligors
Claims with collection risk
Claims for special attention
Subtotal[Percentage of total]
Claims against normal obligors
Total(Millions of yen)
As ofMarch 31, 2009
637
10,498−
11,136[0.89%]
1,233,357
1,244,493

Notes: 1. Claims against bankrupt and quasi-bankrupt obligors are loans to borrowers who are subject to bankruptcy, corporate reorganisation or
rehabilitation or other similar proceedings and other borrowers in serious financial difficulties.
2. Claims with collection risk are loans to obligors (other than bankrupt and quasi-bankrupt obligors) with deteriorated financial condition andresults of operations from which it is unlikely that the principal and interest on the loans will be recovered.
3. Claims for special attention are loans on which principal and/or interest are past due for three months or more and loans witha concessionary interest rate, as well as loans with renegotiated conditions in favour of the borrower, including renegotiated schedule
and/or waivers, in each case, other than the loans described in note 1 or 2 above.
4. Claims against normal obligors are all other loans.

9. Risk-monitored Loans
As of
September 30, 2009
412
10,434−−
10,846[0.88%]

Credits to bankrupt borrowers
Delinquent loans
Delinquent loans past three months or more
Restructured loans
Total[Percentage of total loans](Millions of yen)
As ofMarch 31, 2009
471
10,277−−
10,749[0.87%]

Notes: 1. For the credits of legally bankrupt borrowers and substantially bankrupt borrowers, the amounts remaining after deductions of collateralvalue or the amounts collectible through the execution of guarantees is written-off directly from the borrower’s balance as the estimateduncollectible amounts. The amounts written-off related to credits to bankrupt borrowers were ¥65 million as of September 30, 2009,and ¥66 million as of March 31, 2009. The amounts written-off related to delinquent loans were ¥877 million as of September 30, 2009and ¥786 million as of March 31, 2009.
2. Credits to bankrupt borrowers represent loans which are subject to bankruptcy, corporate reorganisation or rehabilitation or other similar,
including but not limited to foreign, proceedings. Accruing interest of these loans is not recorded as income after determining thatprincipal of or interest on these loans is unlikely to be collected due to the significant delay in repayment of principal or interest payment
or for some other reasons.
3. Delinquent loans are credits whose accruing interest is not recorded as income due to the same reasons as described in note 2 above,and exclude credits to bankrupt borrowers and loans for which interest payments have been suspended and rescheduled to assist andsupport the borrowers in the restructuring of their business.
4. Delinquent loans past three months or more are loans for which interest payment or repayment of principal are delinquent for threemonths or more from the due date under the terms of the related loan agreements, excluding those loans classified as credits to bankrupt
borrowers and delinquent loans.
5. Restructured loans are loans for which certain concessions favorable to borrowers, such as interest reduction or exemptions,
rescheduling of due date of principal or interest payment, waiver of claim or other terms, have been negotiated for the purpose of
assisting and supporting theborrowers in the restructuring of their business. This category excludes loans classified as credits tobankrupt borrowers, delinquent loans and delinquent loans past three months or more.

- 24 -

Fukoku Mutual Life Insurance Company

10. Solvency Margin Ratio(Millions of yen)
As of
September 30, 2009
Total solvency margin

(A)

As of
March 31, 2009

617,454

533,712Foundation funds and surplus

137,576

135,748

Reserve for price fluctuation of securities

25,53924,622

Contingency reserve

145,448

145,160

Allowance for possible loan losses

5,895

4,779

Net unrealized gains on available-for-sale securities x 90%(multiplied by 100% if losses)

28,039(55,611)

Net unrealized gains on real estate x 85%

120,791

125,897

Excess amount of policy reserve based on full-time Zillmer method

96,073

94,391

Qualifying subordinated debt

39,44038,870Excluded items(10,000)(10,000)

Others28,64829,854

109,320

105,844

Total risk ( R1 + R8 ) 2 + (R2 + R3 + R7 )2 + R4

(B)

Insurance risk

R1

29,32329,468

3rd sector insurance risk

R8

9,400

9,360

Assumed investment yield risk R2

18,962

19,110Investment risk

R380,29876,443Business risk

R4

2,759

2,687

Minimum guarantee risk

R7

13

15

1129.6%1008.4%

Solvency margin ratio(A)
1/2 x (B)x 100

Notes: 1. Above figures are calculated based on Articles 86 and 87 of the Enforcement Regulation of the Insurance Business Law and Ministry of FinanceOrdinance No. 50, 1996. ("Excess amount of policy reserve based on full-time Zillmer method is calculated based on Article 1 Paragraph 3-1of Ordinance No.50.)
2. "Excluded items" represent the capital increase to the subsidiary, Fukoku Shinrai Life Insurance Co., Ltd.
3. "Minimum guarantee risk" is calculated by standard method.

- 25 -

Fukoku Mutual Life Insurance Company

11. Status of Separate Account(1) Separate Account Assets by Products
As of September 30, 2009

(Millions of yen)
As of March 31, 2009

AmountAmountIndividual variable insurance−−

Individual variable annuities

673

637

Group annuities

117,087

112,861

Total

117,760

113,498

As of September 30, 2009

(Millions of yen)
As of March 31, 2009(2) Individual Variable Insurance (Separate Account)
The company has not sold the individual variable insurance.

(3) Individual Variable Annuities (Separate Account)(i) Policies in Force

NumberIndividual annuities

Amount204

Number731

Amount209

764(ii) Breakdown of Separate Account Assets for Individual Variable Annuities
As of September 30, 2009
AmountPercentage(Millions of yen)
As of March 31, 2009
AmountPercentage

Cash, deposits, call loans

107

16.0

122

19.1

Securities

565

84.0

515

80.9

Domestic bonds

−

−

−

−

Domestic stocks

−

−

−

−

Foreign securities

−

−

−

−

Foreign bonds

−

−

−

−

Foreign stocks and other securities

−

−

−

−

565

84.0

515

80.9

Loans

−

−

−

−

Others−−−−Allowance for possible loan losses

−

−

−

−

673

100.0

637

100.0

Other securities

Total- 26 -

Fukoku Mutual Life Insurance Company

(iii) Investment Income and Expenses of Separate Account for Individual Variable Annuities(Millions of yen)Six months ended
September 30, 2009

Six months ended
September 30, 2008
AmountAmountInterest, dividends and other income

20Gains on sales of securities−−

Gains on valuation of securities

42

113

Gains on redemption of securities−−

Gains from derivative instruments−−

Foreign exchange gains, net−−

Other investment income−−

Losses on sales of securities

01

Losses on valuation of securities

92

42

Losses on redemption of securities−−

Losses from derivative instruments−−

Foreign exchange losses, net−−

Other investment expenses

−

−

(48)

69

Net investment income(iv) Fair Value Information on Securities in Separate Account for Individual Variable Annuities* Net Valuation Gains/Losses on Trading Securities(Millions of yen)
As of March 31, 2009

As of September 30, 2009
Net valuation
gains/losses
Carrying value on
included in thebalance sheets
statementsof operations

Trading securities

565

71

Carrying value onbalance sheets

515

Net valuation
gains/losses
included in thestatementsof operations(159)

Note: The company had no balances of money held in trust and derivative instruments.

- 27 -

Fukoku Mutual Life Insurance Company

(reference) Fair Value Information on Securities (Total of General Account and Separate Account)
Net Valuation Gains/Losses on Trading Securities(Millions of yen)

As of September 30, 2009
Net valuation gains/losses
Carrying value on
included in the statements
balance sheetsof operations
181,304
12,606

Trading securities

As of March 31, 2009
Net valuation gains/losses
Carrying value on
included in the statements
balance sheetsof operations
171,944(22,151)

Note: The table above includes money held in trust for trading purpose.

Fair Value Information on Securities (with fair value, other than trading securities)(Millions of yen)

As of September 30, 2009

As of March 31, 2009

Gains/losses

Book value Fair value

Gains
Held-to-maturity debt securities

Gains/losses

Book value Fair value
Losses

Gains

Losses146,651

151,719

5,067

5,349

282

152,157

156,525

4,368

5,177

809

Domestic bonds

106,973

111,629

4,656

4,656

－

113,032

117,328

4,296

4,332

36

Foreign bonds

39,67840,089

411

693

282

39,12539,197

71

845

773

Monetary claims bought

－

－

－

－

－

－

－

－

－

－

Negotiable certificate of deposits

－

－

－

－

－

－

－

－

－

－

Others

－

－

－

－

－

－

－

－

－

－

635,925

656,348

20,423

20,52097

628,570644,212

15,641

16,131

489

Policy-reserve-matching bonds

1,393

937

(455)

－

455

1,393

954

(438)

－

438

2,709,101

2,740,256

31,155

106,468

75,313

2,678,173

2,622,561(55,611)

77,291

132,903

Domestic bonds

1,794,889

1,820,443

25,55329,945

4,391

1,705,656

1,727,224

21,56828,906

7,338

Domestic stocks

367,216

411,266

44,04972,24928,199403,395

385,582(17,813)45,49563,309Investments in subsidiaries and affiliates
Available-for-sale securities

Foreign securities

503,489

468,390(35,099)

3,180

38,279519,208

466,188(53,020)

2,388

55,408Foreign bonds

328,293

313,179(15,113)2,504

17,617

328,436

306,869(21,567)

1,942

23,509Foreign stocks and other securities

175,196

155,210(19,986)

675

20,662

190,772

159,319(31,452)445

31,89843,50540,155(3,349)

1,092

4,442

49,912

43,566(6,346)

501

6,847

Money held in trust

－

－

－

－

－

－

－

－

－

－

Monetary claims bought

－

－

－

－

－

－

－

－

－

－

Negotiable certificate of deposits

－

－

－

－

－

－

－

－

－

－

Others

－

－

－

－

－

－

－

－

－

－

3,493,071

3,549,260

56,189132,338

76,1493,460,294

3,424,254(36,039)

98,600134,640

Domestic bonds

2,537,788

2,588,421

50,63355,1224,489

2,447,258

2,488,764

41,50649,3707,863

Domestic stocks

367,216

411,266

44,04972,24928,199403,395

385,582(17,813)45,49563,309Foreign securities

544,561

509,417(35,144)

3,873

39,017559,727

506,341(53,386)

3,233

56,619Foreign bonds

367,971353,269(14,702)

3,197

17,899367,562

346,066(21,495)

2,787

24,283Foreign stocks and other securities

176,589

156,147(20,441)

675

21,117

192,165

160,274(31,891)445

32,336

Other securities

Total

Other securities

43,50540,155(3,349)

1,092

4,442

49,912

43,566(6,346)

501

6,847

Money held in trust

－

－

－

－

－

－

－

－

－

－

Monetary claims bought

－

－

－

－

－

－

－

－

－

－

Negotiable certificate of deposits

－

－

－

－

－

－

－

－

－

－

Others

－

－

－

－

－

－

－

－

－

－

Note: The table above includes assets, such as negotiable certificate of deposits, which are considered appropriate to deem as securities under the Financial Instruments and Exchange Law.

* Book value of securities without fair value are as follows:(Millions of yen)
As of September 30,
2009

As of March 31, 2009

Held-to-maturity debt securities－－

Unlisted foreign bonds－－

Others－－－－Investments in subsidiaries and affiliates

26,132

26,132Available-for-sale securities

29,381

25,671

Unlisted domestic stocks (except over-the-counter stocks)

7,967

7,174

Unlisted foreign stocks (except over-the-counter stocks)

500

500

Policy-reserve-matching bonds

Unlisted foreign bonds
OthersTotal- 28 -－－

20,914

17,99655,51351,803

Fukoku Mutual Life Insurance Company

(reference) Fair Value Information on Derivative Instruments(Total of General Account and Separate Account)(i) Gains and Losses on Derivatives
As of September 30, 2009

Hedge accounting applied(Millions of yen)Interestrelated

Currencyrelated

884

3,539

Stockrelated

Bondrelated−

Others

−

Total

−

4,424

−

390

86

(57)

−

419

884

3,930

86

(57)

−

4,844

As of March 31, 2009

Interestrelated

Currencyrelated

Hedge accounting applied

751

Hedge accounting not applied
Total

Hedge accounting not applied
Total

Stockrelated(954)

Bondrelated

Others

Total

−

−

−

(203)

−

(2,393)(4,600)−−(6,994)751(3,348)(4,600)−−(7,197)

Note: Gains and losses from applying fair value hedge accounting (currency-related, losses of \954 million as of March 31, 2009and gains of \3,539 million as of September 31, 2009) included in gains and losses with hedge accounting applied,and gains and losses with hedge accounting not applied are reported in the statements of operations.

(ii) Interest-related Transactions(Millions of yen)
As of March 31, 2009

As of September 30, 2009
Notional amount/contract valueOver
1 yearFair
value

Notional amount/contract value

Gains(losses)

Fair
value

Over
1 yearGains(losses)Over-the-counter transactions
Interest rate swap contracts
Receipt fixed, payment floating

67,051

46,651916

916

71,05866,738789

Payment fixed, receipt floating

2,500

2,500

(32)

(32)

2,500

2,500

(38)

884

Total

789
(38)
751

* Interest rate swap contracts by contractual maturity dates(Millions of yen)
As of September 30, 2009

1 year or
shorterOver
1 year to
3 years

As of March 31, 2009Over
3 years

1 year or
shorterOver
1 year to
3 yearsOver
3 years

Notional amount(receipts fixed, payments floating)

20,40030,438

16,212

4,320

44,623

22,115

Average fixed rate (receipt)

1.14%

1.39%

1.84%

1.26%

1.25%

1.80%

Average floating rate (payment)

0.72%

0.72%

1.08%

1.24%

0.94%

1.27%

Notional amount(receipts floating, payments fixed)

−

2,500

−

−

2,500

−

Average floating rate (receipt)

−

0.84%

−

−

1.05%

−

Average fixed rate (payment)

−

1.84%

−

−

1.84%

−

- 29 -

Fukoku Mutual Life Insurance Company

(iii) Currency-related Transactions(millions of yen)
As of March 31, 2009
Notional amount/
Fair
Gains
contract value
Over
value
(losses)
1 yearAs of September 30, 2009
Notional amount/
Fair
Gains
contract value
Over
value
(losses)
1 yearOver-the-counter transactions
Currency forward contracts
Sold
US dollar
Euro
Australian dollar
Canadian dollar
British pound
Norwegian krone
Bought215,017
133,398
67,143
14,4607
3
3−

Currency Options
Sold
Calls
[
US dollar[
Australian dollar
[
Euro
[
Puts
[
Bought
Calls
[
Puts
[
US dollar[
Australian dollar[
Euro[
Currency swap contracts
Australian dollar

9,519
60 ]
9,519
60 ]
−
−]
−
−]
−
−]

−
−]
9,000
60 ]
9,000
60 ]
−
−]
−
−]
4,000
4,000

− 211,133− 130,069− 66,527− 14,521
7
−
3
−
3
−
−
−

3,884
3,329
616
(61)
(0)
(0)
(0)
−

−
0

60

[

−
0

60

[

−
−

−

[

−
−

−

[

−
−

−

[

−

−

[

−

− 216,735− 125,222− 91,503
−
−
−
−
9
−
−
−
−
−

61,583653 ]
43,449395 ]
12,534
219 ]
5,600
39 ]
−
−]

−

−

−

−

−
−]
57,040653 ]
40,550395 ]
11,400
219 ]
5,090
39

(31)
(31)

(31)
(31)

4,000
4,000

−
77

17

[

−
77

17

[

−
−

−

[

−

−
−

214,070
124,325
89,734
−
−
9
−
−

Total

(2,665)(896)(1,768)
−
−
(0)
−
−

861

(207)

232

162

601

(382)

27

12

−

−

−

−

237

(416)

191

(203)

4

(214)

41

1

(58)
(58)

(58)
(58)

−
−
−
−

−
−
−
−

4,000
4,000

3,930

(3,348)Notes: 1. Figures in [ ] are option premiums which are included in balance sheets.
2. Forward exchange rates are used for exchange rates as of the end of period.
3. Regarding assets and liabilities which are denominated in foreign currencies but have fixed settlement in yen under currency forward contracts and arereported in yen amounts in the balance sheets, those currency forward contracts are excluded from the table above.

(iv) Stock-related Transactions(millions of yen)
As of March 31, 2009
Notional amount/contract value
Gains
Fair value(losses)Over
1 yearAs of September 30, 2009
Notional amount/contract value
Gains
Fair value(losses)Over
1 yearExchange-traded transactions
Yen stock index futures
Sold
Bought23,326−

Stock index options
Sold
Calls
[
Puts
[
Bought
Calls
[
Puts
[

−
−

−
− ]
−
− ]

−

−
− ]
28,000433 ]−

22,959
−

366
−

−

−

38,703
−

[

−
−

−

[

−

−

[

−
152

Total

(280)
86

[

−
−

−
− ]
−
− ]

−

−
− ]
−
− ]

−

43,303−(4,600)
−

−

−

−

−

−

−

−

−

−

−

(4,600)Note: Figures in [ ] are option premiums which are included in balance sheets.

- 30 -

Fukoku Mutual Life Insurance Company

(v) Bond-related Transactions(millions of yen)
As of September 30, 2009
Notional amount/contract value

Fair valueOver
1 yearAs of March 31, 2009
Notional amount/contract value

Gains(losses)

Fair valueOver
1 yearGains(losses)

Exchange-tradedtransactions
Yen bond futures
Sold
Bought27,810−−−27,868
−

(57)
−
(57)

Total

- 31 -

−
−

−
−

−
−

−
−
−

Fukoku Mutual Life Insurance Company