Financial Highlights of Mizuho Financial Group, Inc. (Consolidated)
Millions of yen
2007

For the Fiscal Years ended March 31,

Total Income
Total Expenses
Income before Income Taxes and Minority Interests
Net Income
Cash Dividends*

¥

2006

4,348,066
3,373,167
974,898
620,965
103,056¥

Thousands of U.S. dollars
2007

3,732,166
2,752,024
980,142649,903
81,421$36,819,935
28,564,377
8,255,558
5,258,410
872,699*Non-consolidated basis.

Millions of yen
2007

As of March 31,

Total Assets
Securities
Loans and Bills Discounted
Deposits
Net Assets
Total Shareholders' Equity¥ 149,880,031
36,049,983
65,964,301
83,608,304¥ 6,724,408/

2006

Thousands of U.S. dollars
2007¥ 149,612,794
37,702,957
65,408,672
82,367,125/¥ 4,804,993$ 1,269,201,724
305,275,500
558,593,458
708,004,946$
56,943,085/

2006

U.S. dollars
2007

Yen
For the Fiscal Years ended March 31,

2007

Per Share of Common StockNet Income
Cash Dividends per Share*
Common Stock
Preferred Stock
Fourth Series Class IV Preferred Stock
Sixth Series Class VI Preferred Stock
Seventh Series Class VII Preferred Stock
Eleventh Series Class XI Preferred StockThirteenth Series Class XIII Preferred Stock¥

51,474.49¥

55,157.14$

435.89

7,000

4,000

59.28

/
/
/
20,00030,00047,60042,000—20,00030,000///169.36254.04*Non-consolidated basis.

As of March 31,

Consolidated Capital Adequacy Ratio (BIS Standard)

2007

2006

12.48%

11.59%*Consolidated Capital Adequacy Ratio (BIS Standard) as of March 31, 2007 is calculated according to regulations promulgated pursuant
to “Basel II.”

Ratings
R&I
JCR
Moody's
Standard & Poor's
Fitch
Long Term Short Term Long Term Short Term Long Term Short Term Long Term Short Term Long Term Short Term

Mizuho Financial Group, Inc.
Mizuho Corporate Bank, Ltd.
Mizuho Bank, Ltd.
Mizuho Trust & Banking Co., Ltd.
Mizuho Securities Co., Ltd.

A
A+
A+
A+
A+

a–1
a–1
a–1
a–1
a–1

—
AA–
AA–
AA–
AA–

—
—
—
—
J–1+

—
Aa2
Aa2
Aa2
Aa2*

P–1
P–1
P–1
P–1
P–1*

A
A+
A+
A+
—

—
A–1
A–1
A–1
—

A
A
A
A
—

F1
F1
F1
F1
—

*Credit ratings for EMTN programme (Joint Medium-term Note Programme with Mizuho International, based on keepwell agreement with Mizuho Corporate Bank).
(As of August 31, 2007)

2007 Mizuho Financial Group Annual Review
ProfileContents

A Message from the President & CEO of
Mizuho Financial Group, Inc.

2

A Message from the President & CEO of
Mizuho Corporate Bank, Ltd.

6

A Message from the President & CEO of
Mizuho Bank, Ltd.

8

Securities, Trust and Asset Management Business
Strategies

10

The group has approximately 47,000

Business Outline

12

staff working in over 770 offices inside

Office Network

14

Business Approaches Adopted by Each Global Group16

CSR Activities

40

2000 through the establishment of a

Brand Strategy

42

holding company of our three

Management Structure44

predecessor banks, The Dai-Ichi Kangyo

Internal Control Systems

48

Senior Executives

65

Location of Overseas Offices

66

Financial Group, our principal group

Financial Analysis [Under Japanese GAAP]

69

companies include Mizuho Corporate

Financial Data of Mizuho Financial Group, Inc.
[Under Japanese GAAP]103

Non-Consolidated Financial Statements ofMizuho Financial Group, Inc. and Four
Subsidiaries [Under Japanese GAAP]

155

Status of Capital Adequacy

171

Investor Information

203

The Mizuho Financial Group is one of thelargest financial institutions in the world,
offering a broad range of financial
services including banking, securities,
trust and asset management, credit card,
private banking services, venture capitalthrough its group companies.

and outside Japan, and total assets ofover $1.2 trillion (as of March 2007).
The group was created in September

Bank (DKB), The Fuji Bank (Fuji) and The
Industrial Bank of Japan (IBJ). Under theumbrella of the holding company Mizuho

Bank, Mizuho Bank, Mizuho Securities
and Mizuho Trust & Banking.

All figures contained in this report are calculated using accounting principles generally accepted in Japan (“Japanese GAAP”).

Forward-Looking Statements
This presentation contains statements that constitute forward-looking 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“ and similar 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.
These statements 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, and management may fail to achieve its targets, for a wide range ofpossible reasons, including, without limitation, incurrence of significant credit-related costs; declines in the value of our securities portfolio;changes in interest rates; foreign currency fluctuations; revised assumptions or other changes related to our pension plans; failure to maintain required capital adequacy ratio levels; downgrades in our credit ratings; the effectiveness of our operational, legal and other risk management policies; our ability to avoid reputational harm; and the effect of changes in general economic conditions in Japan.
Further information regarding factors that could affect our financial condition and results of operations is included in “Item 3.D. Key
Information—Risk Factors,” and “Item 5. Operating and Financial Review and Prospects” in our registration statement on the latest Form
20-F filed with the U.S. Securities and Exchange Commission (“SEC”), which is available in the Financial Information section of our web
page at www.mizuho-fg.co.jp/english/ and also at the SEC's web site at www.sec.gov.
We do not intend to update our forward-looking statements. We are under no obligation, and disclaim any obligation, to update oralter our forward-looking statements, whether as a result of new information, future events or otherwise.

1

A Message from the President & CEO of Mizuho Financial Group, Inc.
Management Structure of Mizuho

Mizuho Financial Group, Inc. (MHFG)Group
Strategy
Affiliates

Mizuho Information & Research Institute, Inc. (MHIR)

Mizuho Research Institute Ltd. (MHRI)

Mizuho Financial Strategy Co., Ltd. (MHFS)DLIBJ Asset Management Co., Ltd. (DIAM)

Mizuho Asset Management Co., Ltd. (MHAM)

to meet the needs of our customers. Leveraging their

Mizuho Private Wealth Management Co., Ltd.(MHPW)

we reorganized our businesses into three global groups

Trust & Custody Services Bank, Ltd. (TCSB)

Under our Business Portfolio Strategy, which is oneof the principal initiatives under our business strategy,

GlobalAsset & WealthManagement
Group

Mizuho Trust & Banking Co., Ltd. (MHTB)

in April 2005.

Mizuho Investors Securities Co., Ltd. (MHIS)

gy, “Channel to Discovery” Plan, which was formulated

Mizuho Bank, Ltd. (MHBK)

forward with the implementation of its business strate-

Mizuho Securities Co., Ltd. (MHSC)*The Mizuho Financial Group (“the group”) is moving

GlobalRetailGroup

Mizuho Corporate Bank, Ltd. (MHCB)

Mizuho's three global groups are implementing strategies to respond to a diverse
range of customer needs.

GlobalCorporateGroup

respective strengths and capabilities, these three groups
are taking initiatives to offer optimal products, services,seas. As a market leader in syndicated loan business,
Mizuho Corporate Bank is working to improve its global
capabilities including the deployment of specialist staff
to its overseas offices. Moreover, Mizuho Corporate
Bank is proactively pursuing the globalization of its
activities, such as expanding overseas network and concluding strategic tie-ups with leading overseas financial
institutions. In December 2006, Mizuho Corporate Bankobtained a financial holding company (FHC) status in2

Mizuho Capital Co., Ltd.

Our Global Corporate Group responds to the wideranging requirements of our clients in Japan and over-

ShinkoSecurities
Co., Ltd.*UC Card Co., Ltd.

and solutions to our customers.

* Subject to the relevant authorities' approval, MHSC and Shinko Securities
will merge as of a target date of January 1, 2008.

the U.S. With this status, Mizuho Corporate Bank is

Asset Management and Fuji Investment Management.

now able to engage in comprehensive investment bank-banking subsidiary in China, Mizuho Corporate Bank

Through the listing of our ADRs on NYSE,
we have further enhanced managementtransparency and are continuing our robust
program of CSR activities, including the support of financial education.

(China) commenced operations. This new subsidiary will

Another initiative under our business strategy is ourenable us to handle renminbi transactions at all its

Corporate Management Strategy. As part of the real-branches in China, and we believe it will make it easierization of this strategy, in November 2006, we listed

to obtain licenses for conducting new business activities

our American Depositary Receipts (ADRs) on the New

in China.

York Stock Exchange (NYSE), with the objectives ofing businesses, such as the underwriting and dealing ofcorporate bonds, equities, and other types of securities,
through its U.S. securities company subsidiary. Also, in
June 2007, Mizuho Corporate Bank's wholly owned

Mizuho Securities, the other principal company inenhancing the transparency of our corporate gover-the Global Corporate Group, is working to further

nance and raising investors' trust in Mizuho to even aenhance the sophistication of its bond, equities, andhigher level. Along with our NYSE listing, we estab-other investment banking businesses. Mizuho Securities

lished a framework for disclosure in accordance withand Shinko Securities have signed an agreement toU.S. generally accepted accounting principles (GAAP),

merge. The merger is subject to the approval from rele-

which is deemed to be one of the global standards. In

vant authorities, with a target date of January 2008.

addition, we strengthened internal controls andIn our Global Retail Group, Mizuho Bank is expand-enhanced the transparency of corporate disclosure ining the number of “Mizuho Personal Squares,” whichline with compliance requirements of the U.S.

are branches with a stronger focus on individual cus-

Sarbanes-Oxley Act, which sets one of the strictest

tomers, and working to significantly strengthen its con-standards in the world today.

sulting capabilities and to enhance its housing loan

We are also implementing corporate social responsi-

business. In order to make services more convenientbility (CSR) activities; these include providing continued

and secure, Mizuho Bank developed various services

vigorous support for financial education, strengtheningthat included expanding the scope of services offered toour environment-related initiatives, and creating barrier-members of the Mizuho Mileage Club, introduction offree environments in our branches.

biometric identification based on finger vein authentification, and other activities.

As part of our strategy for building the Mizuho
brand, under our “Channel to Discovery” brand slo-

For small and medium-sized enterprises and middle-gan, members of the group are working together inmarket corporations, Mizuho Bank is positively respond-

their activities to become known as “A financial part-ing to demands for loans and offering a broad spectrum

ner that helps customers shape their future andof solutions to assist these customers in carrying out

achieve their dreams.”

their business strategies.

its asset management businesses by developing closer

Steady enhancement of the group's comprehensive profitability resulted in solid growth
in income from Customer Groups.

ties of cooperation with the group companies, and toConsolidated gross profits for fiscal 2006, ended March

increase its market share. Mizuho Private Wealth31, 2007, increased by ¥114.9 billion on a year-on-year

Management, another member of this group, offers

basis, to ¥2,117.3 billion. This was particularly due tocomprehensive and fully integrated private banking ser-an increase in net interest income and a steady rise invices. In addition, in July 2007, we created Mizuho Assetfee and commission income from Customer Groups ofManagement through the merger of Dai-Ichi Kangyo

the Three Banks — Mizuho Corporate Bank, Mizuho

In the Global Asset & Wealth Management Group,
Mizuho Trust & Banking is working to further strengthen

3

A Message from the President & CEO of Mizuho Financial Group, Inc.

Bank, and Mizuho Trust & Banking. In addition, theNet Interest Income (MHFG Consolidated)market-related income improved following the disposi-(Net Interest Income: billions of yen)600
Net Interest Income
Loan balance (*3)

tion of unrealized losses on bond portfolios, amounting
to ¥138.5 billion, in the previous fiscal year. Mizuho
Securities and Mizuho Investors Securities, however,(Loan balance: trillions of yen)
75

550

70

500

65

450

60

decreased their operating revenues, mainly in their equity business divisions.
Consolidated net business profits (*1) increased by¥69.0 billion, to ¥991.6 billion, despite an increase ingeneral and administrative (G&A) expenses (excluding
non-recurring losses) driven by an outlay of “strategic
expenses” that will support growth going forward.
Consolidated net income for fiscal 2006 amounted
to ¥620.9 billion, ¥28.9 billion lower than that for theprevious fiscal year. While extraordinary gains of ¥125.9
billion were recorded on gains on cancellation of retirement benefit trusts and other factors, credit-related
costs increased and net gains / losses related to stocks

0

Net Interest
IncomeLoanbalance

Fiscal 2005
(first half)

Fiscal 2005
(second half)

Fiscal 2006
(first half)

Fiscal 2006(second half)¥533.1 bn.

¥529.4 bn.

¥535.1 bn.

¥555.1 bn.

¥61.1 tn.

¥63.6 tn.

¥63.5 tn.

¥65.0 tn.

1.36%

1.29%

1.31%

Domestic
loan-and-deposit
rate margin

0

1.37%
third
quarter 1.35%
fourthquater 1.39%*3. Aggregate average balance of the Three Banks for the period,
excluding loans to MHFG.

amounted to a loss mainly due to certain business performance deterioration within the non-bank financial
services sector.
Reflecting these developments, fully diluted earnings
per share (EPS) for fiscal 2006 steadily improved to¥48,803.
*1. Consolidated net business profit = consolidated gross profits –G&A expenses (excluding non-recurring losses) + equity inincome from investments in affiliates and certain other consolidation adjustments.

 Net interest income
Consolidated net interest income for the second half offiscal 2006 increased by ¥20.0 billion compared withthe first half of fiscal 2006. The average loan balance
for the second half was ¥1.5 trillion higher comparedwith the first half, mainly driven by expansion in overseas lending and stable growth in loans to individuals inthe domestic market. In addition, domestic loan-anddeposit rate margin (*2) for the second half improvedby six basis points compared with the first half.
*2. Aggregate figures of domestic operations of MHCB and MHBK,
excluding loans to MHFG, Deposit Insurance Corporation ofJapan, the Japanese government.

4 Non-interest income
Net fee and commission income of the Three Banks
increased by ¥22.4 billion, to ¥400.8 billion, comparedwith the previous fiscal year. As for our corporate
business, although fee and commission income fromsolution-related business decreased, that from foreignexchange and overseas business and income from trust
and asset management businesses of Mizuho Trust &Banking steadily increased. As for our business withindividual customers, fee income related to investment
trusts and individual annuities continued to increase.
Net Fee and Commission Income (The Three Banks)(billions of yen)
450

400

350

300

0

Net Fee andCommission
IncomeFiscal 2004

Fiscal 2005

Fiscal 2006

¥315.1 bn.

¥378.4 bn.

¥400.8 bn.

 G&A expenses
Principally due to a reduction in IT-related expenses in
Mizuho Bank, “base expenses” of the Three Banks infiscal 2006 further declined by ¥19.3 billion comparedwith the previous fiscal year. Total G&A expenses, however, increased by ¥44.7 billion, to ¥855.7 billion, as aresult of an outlay on “strategic expenses” of ¥98.0 billion aimed at boosting future top-line growth.

¥221.1 billion. Further, in May 2007, we set up a limit,
up to ¥150.0 billion for repurchasing own shares (common stock). Repurchase will be made for the purposeof, among other things, offsetting the potential dilutive
effect of the conversion of the Eleventh Series Class XI
Preferred Stock in consideration of the possibility thatthe number of shares of our common stock will increase

G&A Expenses (The Three Banks)(billions of yen)
900

In May 2007, we repurchased and cancelled all theremaining our common stock held by MHFS at a value ofafter the commencement of the conversion period from
July 1, 2008.

Strategic expenses
Base expenses

Considering the earnings estimates and other factors, we plan to increase the cash dividends per share of800

common stock for fiscal 2007 to ¥10,000 (another¥3,000 per share increase from those for the previous

700

fiscal year). Dividends on preferred stock will be madeas prescribed.
0

G&A Expenses

Fiscal 2004

Fiscal 2005

Fiscal 2006

Going forward, we will continue to utilize our capital¥829.1 bn.
¥810.9 bn.
Strategic expenses ¥33.9 bn.
Base expenses¥777.0 bn.

¥855.7 bn.

effectively, while maintaining and strengthening the¥98.0 bn.
¥757.7 bn.

capital base for our future growth.

We maintain our financial soundness at ahigh level.

implementation of our “Channel to Discovery” Plan, we

As of March 31, 2007, our consolidated capital adequa-

will work to strengthen our competitiveness and prof-

cy ratio (Basel II BIS standard) stood at a sufficient levelitability. At the same time, by fulfilling our responsibili-of 12.48%. In addition, the non-performing loan ratio

ties to society and our mission to serve the public inter-of the Three Banks remains at low level.

est, we will endeavor to further increase our corporate

As we continue to move forward proactively with thevalue. We look forward to your continuing support as

Even after the full repayment of public funds,
we continue to enhance the quality of ourcapital and reinforce our capital base in orderto sustain our top-line growth strategies.

we move closer toward our strategic objectives.
July 2007

As a major step in implementing our capital management, we completed the repayment of all public funds
in July 2006. In addition, we repurchased and cancelled

Terunobu Maeda

a portion of our common stock held by our subsidiary

President & CEO

Mizuho Financial Strategy (MHFS), with a total value ofMizuho Financial Group, Inc.

approximately ¥130 billion. Moreover, in January 2007,
we issued ¥400.0 billion of non-dilutive preferred secu-*The above contains statements that constitute forward-looking

rities to further strengthen our capital base.

statements within the meaning of the United States Private
Securities Litigation Reform Act of 1995. See “Forward-Looking
Statements” on page 1 of this Annual Review for information
regarding factors that could cause actual results to differ from thosein the forward-looking statements.”*The Three Banks: Figures before October 1, 2005 are the aggregate
figures for the Three Banks and their financial subsidiaries for corporate revitalization.

We increased the fiscal year-end cash dividends per shareof common stock for fiscal 2006 to ¥7,000, which is a
¥3,000 per share increase from the previous fiscal year. We
made dividend payments on preferred stock as prescribed.

5

A Message from the President & CEO of Mizuho Corporate Bank, Ltd.

Building a Presence as a Global Investment Bankyuan at all our branches in China. We also anticipate
that this will make it easier for us to obtain authorization to open new branches and obtain licenses forentering new business activities in China.
On the other hand, for those geographic and product areas that our group's network does not cover, weare supplementing our capabilities through stronger
strategic alliances with leading financial institutions byconcluding business cooperation agreements and making equity investments in those institutions.
Another development important for the global
expansion of our activities was the acquisition of financial holding company (FHC) status in the U.S., which we
obtained from the U.S. Board of Governors of the

As we accelerate the pace of theimplementation of our global
strategy, we are entering promising
new business fields.

Federal Reserve System in December 2006. As a result,by combining our banking and securities capabilities
with those of Mizuho Securities, we will be able toexpand the coverage of our investment banking operations from Japan, Europe, and Asia to the U.S. — theworld's largest financial market.

Building on our strong client base as the bank at theStepping Up Our Global Strategy

core of Mizuho's Global Corporate Group, as our

Looking at recent economic and financial market“Investment Banking Declaration” and “Global

trends in Japan and overseas, the Japanese economy is

Declaration” suggest, we are aiming to globally deploy

continuing on a gradual expansionary trend. Our majora business model that promotes and combines our com-

Japanese corporate clients are clearly focusing on two

mercial banking and investment banking capabilities.

strategic objectives. The first is to consolidate theirmarketing and operating positions in Japan and the

Our “Global Declaration” and Its Results

second is to seek new growth in overseas markets.

We followed the “Investment Banking Declaration” that

Overseas, along with the expansion in the international

we announced in 2005 with our “Global Declaration,”

M&A market and in the volume of money in global

which we announced in June 2006, and began initia-

funds, the markets for investment banking services intives to become a leading global bank.

the U.S., Europe, and Asia are showing signs of signifi-

In line with this objective, we opened a branch in6cant growth.

New Delhi, India, in May 2006, and followed this byWith these recent developments in mind, we have

opening another five overseas branches and relevant

resolved to implement a bold global strategy that will

office, and one representative office. In fiscal 2007, we

differentiate Mizuho and give us a competitive edge

are continuing these initiatives to expand our global

going forward.

network coverage. Moreover, on June 1, 2007, Mizuho

Specifically, our global strategy has a number of key

Corporate Bank (China) began operations, thus making

elements. The first is to proactively develop our invest-

us the first Japanese bank to offer services through ament banking operations on a global scale. We alreadybanking subsidiary in China. The advantages of opening

have the top market share in Japan's syndicated loan

this subsidiary include the ability to provide services inmarket and are among the international market leadersin project finance (ranking number three internationallyIn parallel with these initiatives, in personnel man-in 2006) and leveraged finance/management buyouts

agement also, we are executing changes to enable us to(ranking number five in Europe in 2006). Our next

further evolve our business model. To train and recruit

major initiative, subject to the approval from relevant

diverse human resources in Japan and overseas, we areauthorities, will be to merge Mizuho Securities withenhancing policies aimed at further promoting the

Shinko Securities to form a full-service securities compa-

activities and contributions of national staff members

ny that will rival the top three Japanese securities com-

and female employees.

panies. In addition, our FHC status will enable us toMoreover, in the area of compliance, we are fully

offer a full line of securities services through Mizuho

aware of our corporate social responsibilities as a finan-

Securities (USA) in the U.S.

cial institution, and are therefore putting into place

Building on our enhanced capabilities for offering

measures to substantially strengthen our compliancefinancial products and stringent compliance systems, wemanagement frameworks and make them fully capable

will strengthen our ties with Mizuho Securities and offer

of supporting business development on a global scale.

cutting-edge, comprehensive financial solutions globallyto meet the diverse and sophisticated financial needs ofour clients.

Competition among the world's financial institutions
is growing ever more intense. To establish a presence asa global investment bank, it will be essential to structureEntering New Business Fields

a business model of our own founded on strong risk-

The second element of our global strategy is to create

management capabilities and a strict compliance frame-and develop new business fields. Mizuho Corporate

work. We will move into the full-scale implementation

Bank was the first Japanese bank to make a full-scaleof the global strategy that I have outlined and take up

entry into the alternative investment management busi-

the challenge of attaining the objective of “real global-

ness, offering these investment products to professional

ization.” The senior executive officers and employees ofinvestors, including institutional investors and pension

Mizuho Corporate Bank share a common awarenessfunds. Beginning in the current fiscal year, we have

and will promote the development of the bank's model

formed a specialized unit for alternative investments,

going forward. Accordingly, we look forward to earning

and, in April, together with Mizuho Securities, weyour ongoing support as we work to building our pres-established Mizuho Alternative Investment in the U.S. asence as a world class, global investment bank.

a strategic asset management subsidiary for dynamic
development of this business. In addition, in our sales

July 2007

and trading departments, we have expanded our product lineup beyond interest-rate and currency products
to span commodity and credit products.
The third element of our global strategy is to create a

Hiroshi Saito

management infrastructure appropriate for the global

President & CEO

development of our business mission. For example, toMizuho Corporate Bank, Ltd.

build a business platform to support our growth strategy, we are upgrading our information infrastructure andworking to promote the speedy sharing of information
within our organization as well as the transition to a“paperless” working environment. We are also implementing measures to enhance the sophistication of ourdecision-making flow.

7

A Message from the President & CEO of Mizuho Bank, Ltd.

Earning the Unshakeable Trust of Our Customers
adopted measures to heighten the awareness of compliance issues among senior executive officers andemployees and carried out a proactive program of corporate social responsibility (CSR) activities.

A Year Devoted to Creating aRock-Solid Growth Trend.

A Retrospective on the Year: What We Did
to Earn Customer TrustIn fiscal 2006, based on the group's “Channel toDiscovery” Plan, Mizuho Bank, as the core of the Global
Retail Group, worked to move closer to the objective ofour medium-term management plan — becoming “TheBest Bank in the Middle and Retail Markets.” We define“best bank” to mean “No.1 in terms of customer satisfaction” and “No.1 in profitability.” Fiscal 2006 wastherefore a year when we took the next steps towardbuilding long-term relationships of trust with ourclients.
About 25 million individual customers have accounts
with Mizuho Bank, and about 100,000 companies, primarily small and medium-sized enterprises (SMEs) andmiddle-market corporations, rely on us for financing. A
common theme we must address is meeting theincreasingly diverse and sophisticated financial needs ofboth individuals and corporations. During the fiscal

 Services for Individual Customers
Mizuho Bank opened a new branch in the Toyosu areaof Tokyo in March and proceeded with our opening“Mizuho Personal Squares,” the branches with a greater
focus on convenience for individual customers. In addition, during the year under review, we had a total of
about 2,300 financial consultants (FCs), who are capableof offering advice in many specialized areas, assigned toour branches nationwide in Japan. In addition, we
installed “Premium Salons,” which are consultation
booths for our customers, in our branches throughout
Japan. Moreover, we are installing Mizuho Investors
Securities' “Planet Booths” in the lobbies of our branches, whereby we can offer one-stop services to meet the
securities-related needs of Mizuho customers.
Among our products and services for customers, we
continued to enhance the attractiveness of the various
services offered to members of the Mizuho Mileage
Club, including preferential charges on certain services,and total membership in this club now exceeds 3.5 million. In addition, to provide security to our customers,
we proceeded with the issuance of ATM cards incorporating IC chips and, in last fiscal year, introduced biometric identification (finger vein recognition) for ATM
transactions. To deal properly with losses due to forgery
and card theft, we introduced compensation for suchlosses, as provided for under Japan's Depositor
Protection Law.
Within our lineup of loan products, we expanded ourrange of housing loans and our housing loan centers,
which are dedicated to providing such loans and related
services. Through our tie-up with Orient Corporation,
we have created a finance framework that responds toa wide range of needs, including providing uncollateralized loans.

year, we endeavored to strengthen ties with othergroup companies to offer speedy services tailored tomeet the requirements of our customers. Also, whileworking to substantially upgrade our service lineup, we

8 Services for Corporate Customers
In our corporate customer business, while stepping
up our activities to develop relationships with newcustomers, we responded to a wide range of financing

branches, documents, website and interaction withneeds in the SME and middle markets. We also provided

customers.

solution business services, such as facilitating businesssuccession and M&A, supporting IPOs, and offering

Looking to Fiscal 2007

assistance for companies entering or expanding their

The current fiscal year will be the final year of theoperations in markets outside Japan. These solutiongroup's strategic “Channel to Discovery” Plan. We wantbusiness services are offered by about 350 dedicatedto maximize the effectiveness of our ongoing business

staff at the head quarter, who work together withstrategy and attain steady and stable growth. Realizing

branch staff members to help customers address a broadthese goals will require three supporting elements: (a)spectrum of management issues. Moreover, we draw on

winning the maximum trust of our customers, (b) creat-

the comprehensive capabilities of the group, including

ing a rock-solid growth trend, and (c) working to build

the knowledge and skills of Mizuho Investors Securities,

the optimal business infrastructure.

Mizuho Capital, and Mizuho Trust & Banking, to assist

To win the unshakeable trust of our customers, wecustomers in listing their stocks and making arrange-must of course offer a broader lineup of products andments for passing business to the next generation or toservices, but, in addition, to build closer relationships

new owners.

with our customers, we will implement a much larger

For small-scale companies, we have established theshift of personnel from the head quarter to our branch-

Mizuho Business Finance Center, a subsidiary with more

es. At the same time, we will implement initiatives tothan 600 experienced staff, which is dedicated to financ-ensure compliance and customer protection in all

ing small-scale companies and responding proactively to

aspects of our business activities because these are cru-

their needs for funding.

cial preconditions for winning and maintaining cus-

Among financial products, to reduce excessive

tomer trust. To create a rock-solid growth trend, we will

reliance on real estate collateral and guarantees by indi-

make investments and allocate expenditures strategical-

viduals, we are working to expand our range of unse-ly and selectively to strengthen earnings power in our

cured loan products and are endeavoring to develop andcore businesses. To build the optimal business infra-

offer securitization and lending schemes secured bystructure, we will continue working to attain even

operating revenue generated in account receivables,

greater sophistication and efficiency in our internal

inventories, and other assets.

processing operations.

Also, for both individuals and corporations, we are

The senior executive officers and employees of

upgrading our Internet-based banking services andMizuho Bank are committed to making the bank a finan-

actively developing new methods for settlements via

cial institution that offers convenient services for our cus-

mobiles.

tomers, provides them greater security, and inspires
them to think “Mizuho is the bank I want to deal with.” Promoting Compliance and CSR Activities
To create a corporate culture that will promote thorough compliance with laws and regulations and effective internal controls, we have strengthened monitoring
activities at our head quarters and branches and substantially expanded our internal control systems.
In our CSR activities, we are focusing on the themeof “aiming to be a bank that is user-friendly for everyone, regardless of age, gender, or physical challenges.”
These activities, which we have named our “Heartful
Project,” are including creating fully barrier-free

As we work toward building long-lasting customer relationships based on underlying customer trust and confidence, we look forward to your continuing support.
July 2007

Seiji Sugiyama
President & CEO
Mizuho Bank, Ltd.

9

Securities, Trust and Asset Management Business Strategies
Basic Strategy for the Securities Businessand to their funding needs by offering stock and bondIn order to pursue greater synergies by strengthening

underwriting services and consulting business in con-cooperation between group banks and securities com-nection with their capital structure planning. In thispanies and exploiting its overall strengths, the groupway, it aims to become the customer's first choice as thehas promoted integrated banking and securities opera-

most trusted securities company by providing carefully-

tions based on customer segmentation, while ensuring

tailored, high-quality products and securities services inthat the securities companies make the most of theira speedy manner.

capabilities and advantages.
Shinko Securities

Strengths and Characteristics of the Group's
Three Securities Companies

Shinko Securities is a comprehensive securities company

Mizuho Securities

services from underwriting to brokerage. Through

MHSC is a wholesale securities company that offers

dynamic and efficient cooperation with group compa-

high-quality, specialized solutions in response to thenies, it uses its full-line functions to provide middle mar-wide-ranging needs of domestic and international insti-

ket/retail customers with a wide selection of financial

tutional investors, corporations, financial institutions

products and services.

and public sector entities.

with a nationwide network that offers a full range of

Shinko Securities has started to handle wrap

It occupies a top position among the major securities

accounts in its securities sales agency business withcompanies in the area of bond underwriting, andMHBK, and has launched a trust business with MHTB as

boasts a strong presence in bond sales as well. In the

an agent.

equity-related business, it offers a full range of services
and has raised its market standing to a position close tothat of the major securities companies.

and Shinko Securities will merge as of a target date of

the area of M&A and other financial advisory services

January 1, 2008. Mizuho Securities, the merged new

for Japanese clients, and has a track record in struc-entity, will offer competitive cutting-edge financial ser-tured finance that puts it among the market leaders

vices on a global basis through the combining ofin Japan.

MHSC's global investment banking business platform

MHSC also aims to satisfy the diversified needs ofand Shinko Securities' nationwide client base and busi-

clients who are active at home and abroad by offering

ness network as full-service securities company covering

seamless domestic and overseas business services

all of Japan.

through its network of overseas securities subsidiaries.
Mizuho Investors Securities
MHIS is working to expand its cooperative channels
with MHBK by establishing a network of 100 joint
branches. It is also proactively strengthening ties withthe group, promoting a securities sales agency businesswith MHBK, a trust business with MHTB as an agent,and its IPO business through cooperative efforts withother group companies. With this as its operationalbase, MHIS responds to customers' asset investment
needs by offering various securities-related solutions,10

Subject to the approval from relevant authorities, MHSC

It has already established a top-level presence inBasic Strategy for the Trust Businesssystems and revisions to the Company Law.

The group recognizes that the asset management busi-

MHTB will continue to identify clients' needs and toness is a growth sector and is working to deliver thesatisfy them by proactively developing new products

best solutions to clients through MHTB, which offers aand services, and creating new trust business.

full range of trust services as the core Global Asset &Wealth Management Group, and Trust & Custody
Services Bank (TCSB), which offers high-level custody
services.
MHTB quickly and accurately responds to theincreasingly diversified and sophisticated needs oftoday's clients by offering various products and services
together with group companies through the agent system and with external entities through business tie-ups,
and also by holding joint seminars.

Mizuho Trust & Banking
MHTB aims to become the most trusted trust bank by
accurately meeting the diversified needs of clients
through original products and services that draw on thehigh level of expertise and rich know-how it has built up
over many years.
MHTB responds to the asset management andinvestment needs of a wide range of individual clientsby offering consulting services in connection with assets
in general, including financial assets and real estate. It
also offers asset investment products such as “Always”
and “Chochiku no Tatsujin” which are money trusts
based on securitized automobile loan assets, and asset
management products such as “Asset Management
Trusts” for centralized management of financial assets.
In the area of testamentary trusts, MHTB's experienced professionals have earned an excellent reputation
for their carefully-tailored services. MHTB is offering services to an even larger number of clients through its
network of agents at MHBK, and has one of the highestbalances of such trusts in the sector. For corporateclients, MHTB cooperates with group companies inoffering optimal solutions in such areas as real estate,securitization, pensions, the stock transfer agency business and asset management. In particular, through its
sophisticated consulting services, MHTB supports clientsin formulating effective business strategies to deal withmanagement issues arising from changes in accounting

Trust & Custody Services Bank
Based on its advanced systems infrastructure and highly
transparent internal control systems, TCSB provides
financial institutions, institutional investors and otherclients with high-quality, high value-added trust andcustody services, and outsourcing for comprehensive
asset administration services. TCSB also responds toclients' high-level custody requirements through participation in the “account-management institution business” developed in response to securities settlement
systems and infrastructure reform in Japan, and throughthe provision of securities lending services.

Basic Strategy for the Asset Management
Business
In the investment trust and pensions markets, we aim tobecome one of the world's leading players in terms ofboth quality of services and assets under management.
On July 1, 2007, Dai-Ichi Kangyo Asset Management
and Fuji Investment Management merged to become
Mizuho Asset Management.
Our asset management companies, Mizuho AssetManagement and DLIBJ Asset Management, both makethe most of their individual specialties in offering highquality products and services to both group and nongroup clients. In the distribution of investment trusts,
they offer a widely varied line-up of products designed
to meet the increasingly complex and sophisticatedneeds of clients.
In the Japanese defined contribution pension business, we are channeling our total resources into providing solutions for corporate management issues by supporting the formation of assets for individuals to enjoy
in their retirement.

11

Business Outline
We precisely and swiftly provide products, services and business solutions to meet the diversified
financial needs of our customers by actively pursuing group synergies.

Securities
Business

MizuhoSecurities(MHSC)*
A wholesale securities
company whose clientsare institutional investors, corporations, financial institutions andpublic corporations.

Mizuho Corporate Bank(MHCB)MHCB focuses its business on corporate finance, primarily serving
large corporations (such as thoselisted on the first sections of domestic stock exchanges), financial
institutions and their group companies, public sector entities, andoverseas corporations including
subsidiaries of Japanese companies.

Trust and
Asset
Management
Business

MizuhoTrust & Banking(MHTB)
A trust bank that possesses strengths in boththe corporate and individual markets.

UC CardMizuho Bank(MHBK)

Other
Businesses

MizuhoResearch
Institute(MHRI)MHBK serves primarily
individuals, SMEs, andmiddle-market corporations,and local governments in Japan.

A think tank.

Overseas
Subsidiaries

12

A leader among
credit cardcompanies in Japan.

Banking Subsidiaries
Derivatives Subsidiaries
Securities Subsidiaries
Trust Banking
Subsidiaries
Asset Management
Subsidiaries, etc.

MizuhoInvestors
Securities(MHIS)A securities company
that focuses on serving
the group's customers.

ShinkoSecurities*
A comprehensive securities company that
focuses on the middle
and retail markets.

Trust & Custody
Services Bank(TCSB)

DefinedContribution
Plan Services(DCPS)

Mizuho AssetManagement*(MHAM)DLIBJ AssetManagement(DIAM)A highly specialized
trust bank focusing on
the custody business.

An entity that specializes in managing defined contribution pension plans.

An assetmanagement company.

An assetmanagement company.

MizuhoPrivate WealthManagement(MHPW)

MizuhoTrust Realty
Company

MizuhoCreditGuarantee

MizuhoCapitalMizuhoFactors

A private banking
services company.

A real estate agency.

A credit guarantee
and real estate
research company.

A principal
venture capitalcompany.

A factoring company.

MizuhoInformation &Research Institute(MHIR)

Mizuho-DL
Financial
Technology

MizuhoFinancial
Strategy(MHFS)An IT-relatedcompany.

A research anddevelopment companyof financial technology.

An advisory company
for financial institutions.

*Dai-Ichi Kangyo Asset Management and Fuji Investment Management merged as of July 1, 2007 and became Mizuho Asset Management(MHAM).
*Subject to the approval from relevant authorities, MHSC and Shinko Securities will merge as of a target date of January 1, 2008.

13

Office Network
We utilize our office network, which covers every prefecture in Japan as well as major overseas cities,
to respond to our customers' diversified and globalizing financial needs while supporting the smooth
progress of economic activities.

International Network (As of July 31, 2007)
MHCB Overseas branch or relevant office Overseas representative office Major overseas subsidiary or relevant office
MHSC Overseas subsidiary Overseas representative office
MHTB Overseas subsidiary Overseas representative officeLondonBeijing

Amsterdam
TianjinDüsseldorf
Frankfurt
Nanjing

Luxembourg

Wuxi

Moscow

Brussels

DalianSeoul

Vienna

Paris

Wuhan
XiamenZurichShenzhen

TehranMilan

New Delhi
Bahrain
Dubai

Shanghai

Guangzhou
Hong Kong
Mumbai
Hanoi

Taipei
Kaohsiung
ManilaBangkok
Ho Chi Minh City

Kuala Lumpur
Singapore
SydneyLabuanJakarta14

MHCB's Major Global Expansion (April 2006 — June 2007)
2006
May

New Delhi Branch opened

June

Wuxi Branch opened

July

Mizuho Corporate Bank Nederland
Brussels Branch opened

October

Ho Chi Minh City Branch opened

December Obtained financial holding company (FHC) status in the U.S.

Toronto2007
February São Paulo Representative Office commenced businesspromotion activities
March

Moscow Representative Office opened

April

Milan Branch opened

May

Mexico Representative Office commenced business promotion activities

June

Mizuho Corporate Bank (China) established and MHCB's
five branches in China (Shanghai, Beijing, Shenzhen,
Dalian, Wuxi) transferred into the head office andbranches of that company.
Mizuho Corporate Bank (USA) established four representative offices in the U.S. (Atlanta, Chicago, Houston, Los
Angeles)

Vancouver
ChicagoDubai Branch opened

San Jose
July

Los Angeles

Mizuho Corporate Bank (China)
Tianjin Branch opened

New York
HoustonCaymanMexico City

Atlanta

Network in Japan (As of July 31, 2007)
MHCB
Head Office and Branches: 18

MHBK
Head Office and Branches: 390
Sub-branches: 48
Agencies: 48

MHSC

São Paulo

Head Office and Department: 2

MHTB
Head Office and Branches: 35
Sub-branch: 215

Business Approaches Adopted by Each Global Group

Global Corporate Group— Approaches to Large and Global Corporations, and Other Entities —Business Environment and Overview of the Global Corporate GroupThe Japanese economy remains firm due to strong exports and robust capital expenditure driven by asustained improvement in corporate earnings. Moreover, with firm growth in the U.S., Europe and Asia,
the global economy is taking a turn for the better, and markets for various industries are expanding as aresult of surging worldwide demand. In this environment, there are signs of a global industrial realignment that transcends national boundaries. Under these conditions, clients among large and global corporations and other entities expect financial institutions to do more than simply resolve their financial
issues in areas such as funding and financial efficiency. Indeed, their needs have expanded to include
restructuring existing businesses, advancing into new business sectors, overseas strategies, risk management and numerous other management issues.
For a financial group to enhance its competitiveness in satisfying these needs, it is essential to offer
sophisticated, cutting-edge solutions that combine financial functions such as securities and trusts, aswell as banking.
To respond to the needs of large and global corporations and other entities, the Global Corporate
Group provides highly specialized, cutting-edge solutions by leveraging its banking, securities, trust andother financial capabilities and promoting close cooperation between the global corporate banking sector and the wholesale securities sector.

16

GLOBAL CORPORATE GROUPKey Group Companies

Highlights

 Mizuho Corporate Bank MHCBMHCB provides optimal solutions to the increasingly• In December 2006, became the first Japanese bankto acquire financial holding company (FHC) status in
the U.S.

diverse and sophisticated needs of clients in the areas ofboth finance and business strategies, focusing its efforts
on serving major corporations (such as those listed on
the first sections of domestic stock exchanges), financial
institutions and their group companies, public sector
entities, and overseas corporations including subsidiaries
of Japanese corporations.
Specifically, it is revamping its organization to dramatically strengthen its ability to provide solutions
through competitive services at the global level.
In addition to taking full advantage of the functionsof other group companies such as MHBK, MHSC and
MHTB, it is working in broadly based cooperation with

• Established an asset management company in New
York to engage proactively in “alternative” asset
management business aimed at professional
investors, an area experiencing remarkable global
growth and expansion.
• Remains committed to expanding its network.
Established branches in New Delhi, Wuxi, Brussels*and Ho Chi Minh City, and representative office in
Moscow, and commenced business promotion activities at the São Paulo Representative Office in fiscal
2006. Became the first Japanese bank to establish a
local subsidiary in China in June 2007.
* The Brussels Branch is a branch of Mizuho Corporate
Bank Nederland.

foreign investment banks and various types of investment funds as it pursues a “deal after deal” marketingstrategy that offers clients cutting-edge financial solutions on a continuous, multi-faceted basis.

 Mizuho Securities
MHSC is a wholesale securities company that offers
high-quality, specialized solutions in response to thewide-ranging needs of domestic and overseas institutional investors, corporations, financial institutions andpublic sector entities.
Its operations have been broadly divided into the“Global Investment Banking Groups” and the “Global
Markets & Products Groups,” and it is strengthening its
market presence in both areas.

• Maintained top domestic share in the syndicatedloan sector in fiscal 2006.
• Claimed number three spot in Thomson Financial's
world ranking of project finance arrangers.

 MHSC• Concluded a merger agreement with Shinko
Securities on March 29, 2007. Subject to the relevant authorities' approval, the merger will take place
as of a target date of January 1, 2008.
• Implemented a sweeping reorganization in April
2007 to enable it to offer proposals for comprehensive solutions in response to clients' increasingly
sophisticated needs.
• Received the Thomson DealWatch “Straight BondHouse of the Year” and “Asset-backed Securities
House of the Year” awards.

17

Business Approaches Adopted by Each Global Group

Global Corporate Group

Accelerated Global Strategy
Acquisition of FHC Status in the U.S. Marks New Embarkation
In December 2006, MHCB became the first Japanese bank to acquire financial holding company (FHC) status in the U.S. As
a result, Mizuho Securities USA is now able to engage in full-scale securities business operations in the U.S., including underwriting corporate bonds and equities. From a broader perspective, it also enables Mizuho to engage in a wide range ofinvestment banking activities in the world's largest market — the U.S. — in addition to Japan, Europe and Asia.

Development of New Business Fields
In the global wholesale market, MHCB is now proactively engaged in the “alternative” asset management business, which is
growing and expanding at a remarkable rate. Its goal is to open up new business fields with high growth potential. To thisend, in April 2007, a specialist unit was created within MHCB and an alternative investment company was established in
New York jointly with MHSC. MHCB will further strengthen its global capabilities in Japan, the Americas and Europe with aview to becoming Japan's pioneer in this area.
Making the promotion of its global investment banking products more sophisticated and strengthening its approach to
new business fields with high growth potential will enable MHCB to provide clients with advanced financial solutions of ahigher level of sophistication than ever before.

Accelerating Global Business Promotions
New Global Expansion
As a leading financial institution in Japan, Mizuho offers domestic and foreign clients engaged in global business activities
the best available solutions by dynamically combining its rich experience in overseas markets with its powerful overseas network and its cutting-edge financial products.

 Strategic Reinforcement of Office Network
In light of the increasing global expansion of its clients' business, MHCB is proactively extending its global network in orderto provide them with high-quality support.
Among other things, it has strengthened its support for Japanese companies that are increasingly active in the burgeoning BRICs (Brazil, Russia, India and China) economies. MHCB opened the New Delhi Branch in May 2006, the Wuxi Branch inJune 2006, and the Moscow Representative Office in March 2007. In February 2007, the São Paulo Representative Officecommenced business promotion activities. It also opened branches in Brussels* in July 2006, and in Ho Chi Minh City in
Vietnam in October the same year. The branches in New Delhi and Ho Chi Minh City are the bank's second branches in thetwo countries, allowing MHCB to offer services that are even more seamless than before.
In fiscal 2007, it opened the Milan Branch in April, and the Dubai Representative Office in June. In May 2007, the Mexico
Representative Office commenced business promotion activities. On June 1, 2007, Mizuho Corporate Bank (China) opened
for business, and Mizuho's five Chinese branches (Shanghai, Beijing, Shenzhen, Dalian and Wuxi) were transferred to its
jurisdiction. The establishment of a local subsidiary should expedite authorizations for new branches, allow all branches in
China to handle the yuan, and make it easier to obtain licenses for new businesses, ultimately resulting in greater convenience for its clients. Also, MHCB opened the Tianjin Branch in July 2007, the first new branch in China since the local subsidiary was established.
MHCB will continue to carefully analyze medium- to long-term trends in economic conditions and clients' needs in theseregions with a view to maintaining its flexible, proactive branch network development strategy.
*The Brussels Branch is a branch of Mizuho Corporate Bank Nederland, a wholly owned subsidiary of MHCB.

18

GLOBAL CORPORATE GROUP— Approaches to Large and Global Corporations, and Other Entities — Strengthening Alliances
The group complements those regions and products that its network cannot cover by strengthening relationships with leading local financial institutions through tie-ups and equity investments.
It has built relationships with a number of overseas financial institutions, including TISCO Bank of Thailand in June 2006,
and two Korean financial institutions — the Shinhan Financial Group and the government-affiliated Korea Development
Bank — in September the same year. It also tied up with two banks in Kazakhstan — JSC Kazkommertsbank and thegovernment-affiliated JSC Development Bank of Kazakhstan — in February 2007, and BANORTE (Banco Mercantil del Norte)of Mexico in March 2007. Together with its equity investment in China CITIC Bank Corporation in April 2007, these moves
represent its efforts to build up its cooperative relationships so that it can better respond to its clients' needs.

Approaches to the Global Alternative Investment Business
MHCB is the first Japanese bank to engage proactively in a
rapidly growing and expanding area of the global whole-

The Positioning of the Alternative Investment BusinessIndex funds

sale market — the “alternative” asset management business aimed at professional investors such as institutional
investors and pension funds.

Listed investment
trusts Establishing Mizuho Alternative Investments
Average

Investments, as a strategic focus for full-scale engagement

GrowthIn April 2007, MHCB and MHSC jointly established an asset
management company called Mizuho Alternative

Structured
creditReal estate

Marketrelated
segments

is due to establish a credit arbitrage fund. Positioned at thePrivate equity
funds
Quantsproducts
Alternative segments
Huge
potential

Money market

in the alternative investment business.
In addition to investing in CLOs and CDOs, the company

Hedge funds

Stocks
Bonds
Traditional segments

core of group business operations, this company will offer

Profitability

products that are attractive to investors by boosting its
investment earnings and expanding its product lineup.

 Future Business Development
Centered on Mizuho Alternative Investments and Mizuho Investment Management UK, the group is working vigorously todevelop investment products. At the same time, it is reinforcing its network across the Americas, Europe and Asia, including
the establishment of an investment company in Tokyo, in order to strengthen its access to global money and create superior
level investment opportunities.
It is also drawing on the all-round strengths of group companies through appropriate tie-ups with their various functions
as represented by MHSC, which is strengthening its global sales network, MHTB, which has been commissioned to handle
pension fund management, and Mizuho's asset management companies.

Sharing Clients' Global Growth Strategies
Based on its “Investment Bank Declaration” and its “Global Declaration,” MHCB is drawing on its robust, long-term relationships with clients in the area of commercial banking operations to develop its “solutions business” and thus help raise its
clients' corporate value over the medium- to long-term.
Acting as relationship managers (RMs) for the entire group and employing a “strategic advisory service-based solutions
business approach” as their code of behavior, MHCB's RMs identify the management issues clients face amidst intensifying
global competition. They offer M&A advisory services, various forms of securitization, syndicated loans and pensions andcash management systems (CMS), and make maximum use of the banking, securities, trust and other specialist functions
embodied within the group to offer the best possible financial solutions on a global basis.

19

Business Approaches Adopted by Each Global Group

Global Corporate GroupThe environment facing clients is changing rapidly as a result of growing activity in the area of strategic cross-border corporate alliances and increasingly fierce competition for market share in emerging markets overseas. MHCB's Industry
Research Division has led the field of domestic industrial research for many years, and has now established its offices in New
York and London to strengthen its industrial research capabilities on a global basis, allowing it to work with its clients intackling management issues and strengthening its functions as a global partner.
Combining CB (Commercial Banking) and IB (Investment Banking) Functions
Strategic advisory functions from the perspective of enhancing clients' corporate value

Build long-term relationships
through the CB business
Lending, settlement (domestic/foreignexchange, deposits), corporate retail,trusts, etc.

Use synergy to
expand scopeof business

Enhance clients' corporate value
through the IB business
M&A, financial solutions, etc.

Create and supplement the CB business using the IB business

Solutions for Financial Institutions and Public Sector Entities Financial Institutions
MHCB offers the financial institutions among its clientele appropriate proposals for comprehensive solutions in such areas asfinancial strategies and risk management. In order to respond to clients' increasingly diverse and sophisticated investment
needs, MHCB's investment proposals have come to embrace new products and investment instruments, including crossborder syndicated loans, and investment products incorporating tailor-made investment trusts and structured credit products. MHCB also draws on the financial functions of group companies for creating proposals for high-quality advisory services and solutions to management issues associated with strengthening clients' financial structures. These include capital
policies, removing assets from the balance sheet, offering products for retail, and internal control schemes.

 Public Sector Entities
Special public corporation reforms, government FILP (Fiscal Investment and Loan Program) reforms and other reforms affecting the public sector have now begun in earnest. As a result, the needs of public sector clients have become more diverseand sophisticated than ever. In response, MHCB endeavors to propose optimal solutions that bring together the sophisticated expertise and know-how of group companies. In the area of diversifying financial needs, examples include the arrangement of syndicated loans and asset securitization, as well as advisory entrustment and the proposal of derivative products tomeet increasingly complex risk management needs.
In the public bond business, MHCB provides issuers with stable support for funding using its strong record and rich experience as a leading bank.

Offering Financial Product Functions at the Global Level
Providing Comprehensive Solutions at Home and Overseas
 Leveraged Finance and MBOs
Amidst the rapid growth in Japan's M&A business in recent years, MHCB has endeavored to help clients raise their corporate
value through business restructuring by promoting leveraged finance, primarily non-recourse finance, based on the cashflows of the target companies. In the MBO/LBO sectors in particular, it provides advisory services and arranges finance in

20

GLOBAL CORPORATE GROUP— Approaches to Large and Global Corporations, and Other Entities —connection with large-scale business restructuring involving sell-offs of clients' business divisions and subsidiaries, and similar
deals. It has also adopted a proactive approach to cross-border deals and through its four-axis global network centered on
Tokyo, New York, London and Hong Kong, has compiled an excellent track record in the sector for leveraged finance transactions at the global level.
Group companies Mizuho Corporate Advisory and Mizuho Capital Partners provide advisory services in connection with
MBOs and financial strategies, as well as responding to clients' increasingly sophisticated financial needs through investments in MBO funds and mezzanine funds.

 Real Estate Finance
MHCB is a leading player in the real estate finance business, using a full range of instruments, from senior debt to mezzanine finance, and equity investment to arranging financing. It also puts together large-scale development finance projects
associated with urban renewal, such as the Tokyo Midtown Project, which redeveloped the site once occupied by the
Defense Agency, and engages in the real estate fund investment business.
As globalization fuels rapid changes and expansion in the real estate market, it is endeavoring to provide clients with
optimal solutions for their efforts in areas like financial strategies and domestic and overseas real estate deals. In doing so, itdraws on its strong record and rich experience in real estate finance, its real estate-related advisory functions and its links
with overseas branches.

 Structured Finance
MHCB supports clients' financial strategies by arranging securitization programs to satisfy their diversifying needs for funding through asset securitization and offering optimal solutions for removing assets from the balance sheet in order toimprove their management indices.
It offers several securitization solutions for clients with a variety of assets, and uses syndication methods to satisfy
investors' needs for sophisticated, specialist products and solutions.
In order to provide a wide range of finance solutions using securitization methods, it offers inventory finance and otherforms of asset-based lending, and “whole business securitization” schemes for securitizing businesses based on operational
cash flow.

 Project Finance
By its very nature, project finance has to be tailored to the different business structures of individual projects, and requires
sophisticated skills and a rich store of knowledge. With its

Project Finance Global Mandated Lead Arranger Table(January to December 2006)

Rank Company nameAmount(millions of
U.S. dollars)

No. oftransactions

1
2
3
4
5
6
7
8
9
10

13,236.7
8,664.4
7,722.8
7,028.5
6,276.3
5,930.3
5,790.6
5,436.4
5,365.2
4,425.5

66
60
54
34
18
47
32
36
27
47

team of highly experienced banking staff operating at the
global level, MHCB ranks third in the world on an arrangement value basis. This kind of performance has greatly
enhanced its reputation, to the extent that in February 2007
it was awarded the financial advisor contract for the Panama
Canal expansion project by the Panama Canal Authority. A
total of 15 U.S., European and Japanese banks participated in
the international bid for the contract.
In line with the shift from the public to the private sector,

Royal Bank of Scotland
CalyonMizuho Financial Group
Societe Generale
ABN AMROBNP Paribas
Banco Bilbao Vizcaya Argentaria
WestLB
State Bank of India
Mitsubishi UFJ Financial GroupMHCB offers non-recourse finance for PFI/PPP projects such as

Source: Thomson Financial

natural resource development, power generation, desalinationand infrastructural improvement in Japan and overseas. It has also established an expert financial advisory team to offer
optimal solutions to clients with a range of needs for project feasibility assessments and funding advice.

21

Business Approaches Adopted by Each Global Group

Global Corporate Group

Syndication Business Continues to Develop
Japan's syndicated loan markets have grown rapidly inrecent years and MHCB plays a leading role in driving mar-Trends in Japan's Syndicated Loan Market andMizuho's Shareket growth and providing high value-added services by(Trillions of yen)making active use of the syndication function to meet avariety of corporate financial needs in all sectors. Examples

30

Arrangement of Syndicated
Loans in Japan (Fiscal 2006)

25

include cross-border syndicated loans (“Ninja Loans”) for
foreign companies and sovereign entities raising funds in

Mizuho's
Share:
33%

20

the Japanese market, large LBO deals using M&A finance,and earthquake disaster response deals (“RenaissanceCommitment Lines”) to facilitate financing when disastrous
earthquakes occur. MHCB also made a major contribution
to the development of the loan trading market, handling

15

10
5

deals amounting to over ¥1 trillion in fiscal 2006.
To provide appropriate solutions for clients expanding
their global businesses in a wide range of areas, it has
deployed expert staff at its offices in New York, London,0

Fiscal Fiscal Fiscal Fiscal Fiscal Fiscal
1997 1998 1999 2000 2001 2002
Sources:

Shanghai, Hong Kong and Singapore. In addition to further

Fiscal Fiscal Fiscal Fiscal
2003 2004 2005 2006

Thomson Financial
Bank of Japan statistics(Market share calculated by MHCB)

strengthening its global syndication framework, thisenables it to promote its comprehensive, worldwide investment banking business through tie-ups with various services centered on financial products.
Through its commitment to a proactive involvement in the syndication business as a means of satisfying the needs ofboth corporate clients and financial institutions, MHCB is seeking new modes of corporate finance that go beyond traditional methodologies. It is also determined to contribute to further market development in its role as a market leader in marketoriented indirect financing.

Promoting the Global Market Business Strategic Reinforcement of Sales and Trading Capabilities
MHCB has expanded its product lineup from basic areas such as interest rates and foreign exchange to oil, metals, weather
and other commodity derivatives, and ultra-long-term, low-liquidity currency derivatives. For local currency transactions incountries around the world, it continues to expand its product range, strengthen its trading capabilities, and offer high-quality
solutions to increasingly globalized clients, thus maintaining its efforts to become the most relied-on “bank of choice.”
It is also strengthening its tie-up with Mizuho-DL Financial Technology (a group company specializing in the developmentof financial technology) and is introducing sophisticated risk control methodologies that incorporate dynamic foreignexchange hedging — a statistical/probabilistic exchange risk hedging method that eliminates market views and arbitrariness— and loans that incorporate commodity derivatives, to take care of areas that are not covered by existing risk management
methods.

 Full-Scale Involvement in the Credit Market
MHCB is determined to make a full-scale entry into the credit market. Starting with its investment in Mizuho Alternative
Investments, an asset management company established in the U.S. to manage credit arbitrage transaction funds, it isdiversifying its credit investment management style and expanding the size of its investments. It is also expanding its credit
derivatives trading in areas like correlation trades, which focus on the correlations between multiple issues in credit default
swaps (CDS).

22

GLOBAL CORPORATE GROUP— Approaches to Large and Global Corporations, and Other Entities —Promoting the Transaction Business at the Global Level
 e-Business
MHCB responds to clients' needs for greater efficiency in fund operations by offering the Mizuho Advanced CMS cash management system as its core solution product for pooling, agency payment services and other solutions for managing funds.
It also offers sophisticated cash management solutions at a global level to clients with overseas offices through theMizuho Global CMS and the Mizuho Global Pooling Service.

 Exchange and Trade FinanceSpecialist divisions and domestic and overseas offices cooperate in business promotion by proposing global-based solutions.
MHCB responds to clients' overall finance needs in the area of trade and overseas investments through currency options,NDF (Non-Deliverable Forwards) and other forms of exchange hedges, issues of guarantees for large exports centered on
emerging markets, structured trade finance, commodity finance and advanced trade finance, including ECA finance (financeprovided principally to developing countries in cooperation with public Export Credit Agencies).

 Yen Cash and Securities Settlements Business
MHCB has been offering comprehensive yen cash and securities clearing services to global financial institutions. In order tomake operations more efficient and solid and to meet sophisticated clients' needs, we continue to upgrade our systems andimplement everyday “Kaizen (improvement)” process into our operations. Recently, Euroclear, the world's largest international securities settlement service provider, has designated MHCB as the sole custodian for JGB transactions.

 Pensions Business
Drawing on total group strengths to offer comprehensive pension services, MHCB has a top class number of participants inthe field of defined contribution pension plans in Japan. MHCB also acts as a trust agent for MHTB.

Credit Portfolio Management
MHCB has been proactively engaged in credit portfolio management (CPM) as part of its efforts to promote its “originate to
distribute” business model. It is working to maintain and enhance the soundness and profitability of its credit portfolio bystrategically rebalancing its assets and controlling credit risk by utilizing the credit market to respond to changes in the status of the bank's entire credit portfolio and the macro economic situation.
Specifically, it is expanding its efforts in loan sales and hedging through CDS and securitization targeting domestic andforeign companies. For instance, in March 2007 it arranged synthetic CLOs, a new securitization scheme hedging only thesubordinated portion of loans, which pose high credit risk. All these steps were taken with a view to managing its credit
portfolio more actively on a global basis.
In order to respond more flexibly and timely to its clients' increasingly global and diversified finance needs, it intends tostrengthen its efforts in the area of CPM.

23

Business Approaches Adopted by Each Global Group

Global Corporate Group

Seeking to Become Japan's Leading Investment Bank
Since it's founding in October 2000, MHSC has made steady progress in its transformation into a full-scale investment bankas a wholesale securities company. Since fiscal 2007, it has adopted “Seeking to Become Japan's Leading Investment Bank”
as a key theme of its mission, and is now implementing an action plan to realize it. The plan's management objectives callfor a stronger market presence, a higher profile as a global investment bank, a robust business structure more fitting for amarket leader, and the training and long-term employment of professional human resources.

Strategic Reorganization
To strengthen its product development and deal execution abilities, MHSC introduced a divisional system, establishing the
Global Investment Banking Groups to consolidate its primary market operations, and its Global Markets & Products Groups
to consolidate its secondary market operations. The Global Investment Banking Groups were further reorganized to extend
its coverage in order to enhance its ability to put forward comprehensive solutions for clients and thus strengthen its ability
to satisfy their needs.

Global Investment Banking Groups

Total SB League Table

functionally separated the “coverage organization,” which(including samurai bonds and municipal bonds, and excluding
subsidiary debt issue, self-led issue, and retail-targeted)*Lead managing amount basis. Total amount of issues: ¥8,362.1 billion.
(April 2006-March 2007)

serves as the overall interface with clients, from the “products

Rank Company nameorganization.” Enhancing the expertise of each organization

1
2
3
4
5

The reorganization of the Global Investment Banking Groups

enables them to offer a wide range of solutions.
In the area of bond underwriting operations, one of its
long-standing strengths, MHSC has sustained its sector-leading

capabilities, its ability to set prices to reflect clients' demandwith precision, and respond rapidly to changes in the market.
ing business, which it sees as a strategic sector, and has

1
2
3
4
5

MHSC has used its personnel resources and know-how to

Mizuho Financial Group
Daiwa Securities SMBC
Nomura Securities
Goldman Sachs
Citigroup

position as the top overall ABS bookrunner for the sixth consecutive year, underscoring its high profile in the structured financesector, notably in securitizing real estate and monetary claims.
In the area of M&A advisory services, it draws on its
advanced sectoral knowledge and know-how to provide
advice that suits clients' management strategies, winning a
top-class reputation for its capabilities that consistently places
it on the top rungs of the advisory rankings.

24

No. of Amount Shareissues (billions of yen)(%)
18
678.4 20.8
8578.2 17.8
5523.1 16.1
3
366.3 11.3
2
336.2 10.3
Source: Thomson Financial

compile an impressive record that puts it among the market
leaders in Japan. Among other things, it has maintained its

20.61
19.35
15.15
14.32
11.85

(Domestic public and private bonds and Eurobonds)*Closing date basis. (April 2006-March 2007)

Rank Company namedates as the lead manager in some major finance deals.

1,723.5
1,617.8
1,267.1
1,197.5
990.8

Overall ABS Bookrunner League Table

MHSC is strengthening its initiatives in the equities underwritgrown to occupy a place as a major player by winning man-

Share
(%)

Source: Calculated by MHSC, based on data of I-N Information Systems

performance. It is also building long-term relationships oftrust with its clients as a result of its powerful bond selling

Daiwa Securities SMBC
Mizuho Securities
Mitsubishi UFJ Securities
Nomura Securities
Nikko Citigroup

Amount(billions of yen)

M&A Advisory Ranking(Japanese target, any acquirer nation, deals completed)(January to December 2006)

Rank Advisor
1
2
3
4
5

Goldman Sachs
NomuraCitigroup
Daiwa Securities SMBC
Mizuho Financial Group

Amount (millions
of U.S. dollars)
36,88235,84033,62427,53926,230

Share
(%)
34.3
33.3
31.2
25.6
24.4

Source: Thomson Financial

GLOBAL CORPORATE GROUP— Approaches to Large and Global Corporations, and Other Entities —Looking ahead, it will reinforce its ability to put forward and execute proposals in line with clients' business strategy
needs and create new business opportunities, while striving to further expand its M&A business.

Global Markets & Products Groups
Having carved for itself a position as a market leader in the bond business from the beginning, MHSC provides products thatsuit its clients' investment strategies, engaging proactively in market-making and offering high-quality information. It is alsochanneling its management resources into the equities business, rapidly enhancing its market presence and responding
appropriately to clients' increasingly sophisticated needs. It will further respond to its clients' needs and expand its market
presence at home and overseas by strengthening its ability such as selling to overseas investors, engaging in trading in overseas stocks, and arranging and offering a variety of high value-added products.
It will also channel its management resources into the middle retail business to respond to the change in money flow as
the shift away from savings and towards investments spreads to individuals as well as institutional investments and industrial
corporations, proactively engaging in the securities sales agency business through regional financial institutions.

Further Strengthening Global Operations
As a core company responsible for the Global Corporate Group's securities business, MHSC has deployed securities subsidiaries in the U.K., the U.S., Hong Kong, Switzerland, China and other overseas financial markets. This has strengthened its
operating structure as a global investment bank that underwrites and sells equities and corporate bonds and engages in the
M&A advisory business. When MHCB obtained FHC status in the U.S. on December 18, it became possible for it to engage
in the broadly based investment banking business in the U.S. With Mizuho Securities USA. as its core entity, it now aspires
to create new business opportunities.

Merger with Shinko Securities
Based on the judgment that it is essential to restructure to allow for the provision of competitive, cutting-edge comprehensive financial services on a global basis, the decision was taken to merge MHSC and Shinko Securities. “Basic Agreement for
Merger” was signed on January 10, 2007, and the merger agreement was concluded on March 29, 2007. Subject to theapproval from the relevant authorities, the merger will take place as of a target date of January 1, 2008. This will result in
the fusion of MHSC's global platform in the investment banking sector incorporating Shinko Securities' nationwide customer base and comprehensive securities network. Combining these two strengths should prove to be extremely importantin boosting MHSC's standing still further.
After the merger, the new company Mizuho Securities will not only quickly establish high-level strengths in productdevelopment, financial expertize and sales, but will also exploit Mizuho's robust client base and global network as much as
possible. In this way, it will aim to maximize the synergies of the merger as it aims to become one of the top investmentbank operating in the global arena.

25

Business Approaches Adopted by Each Global Group

Global Retail Group— Targeting Individuals, SMEs and Middle-Market Corporations —Business Environment and Overview of the Global Retail Group The Environment Facing Individual Customers
Against the background of an aging society with falling birthrates and other societal changes, as well as
recent trends in interest rates and post-deflationary changes in the economic environment, customers'
needs have diversified and become more sophisticated, while progress in deregulation has engendered newbanking products and services. Furthermore, although technological developments like the Internet haveencouraged these trends, new issues have arisen in such areas as the handling of personal information andsecurity. In this more complex financial society, banks must offer products that better match the customer's
life stage, superior security functions, and convenient channel networks. They must also build up relationships of even greater trust with customers through sincere communications based on accountability.

 The Environment Facing SMEs and Middle-Market Corporations
As corporate earnings continue firm, it is essential to instill a new sense of vitality into the Japanese
economy by promoting the creation and development of SMEs and middle-market corporations withgrowth potential, and venture businesses with a revolutionary, challenging spirit.
Banks are strongly required to respond to these corporate customers' needs for stable lending services
and management issue resolution.
With the close cooperation of the group companies of Mizuho and leading domestic and international
companies, the Global Retail Group provides top-level products and services on a global scale inresponse to the increasingly diversified and globalized needs of individuals, SMEs and middle-market
companies.
26

GLOBAL RETAIL GROUPKey Group Companies

Highlights

 Mizuho Bank Mizuho BankMHBK is proactively establishing “Mizuho Personal

Approaches to Individual Customers

Squares” — branches with a greater focus on conve-• Membership of the “Mizuho Mileage Club” hastopped the 3.5 million mark.

nience for individual customers — as part of its services
for individuals. It is training up more financial consultants
to strengthen its consulting services, and expanding its
framework for providing more competitive products
through tie-ups with companies inside and outside thegroup. In the area of personal loans, it is reinforcing its
abilities to develop products that will enable it to respond
more flexibly to customers' needs. It is also encouraging
customers to deepen and expand their banking transactions through the “Mizuho Mileage Club,” which allows
them to accumulate points according to their usage of
MHBK services, while improving the convenience of settlement channels using ATMs, and strengthening security.
As for the needs of SMEs and middle-market corporations for funding and resolution of management issues,
it makes use of the financial functions and networks ofMizuho and business tie-ups to offer optimal products,
services and solutions to customers ranging from those
who are just starting up in business to those who seek
to expand.

 Mizuho Investors Securities
In line with its aspirations to become “the securities
company that customers know and trust most,” MHIS isworking with MHBK to establish joint branches and pro-• There are now 90 branches with “Mizuho Personal Squares” offering greater focus on individual
customers.
• The number of “Planet Booths” jointly established by
MHBK and MHIS has reached 100.
• “Special Consulting Program for Retirees” are offeredto provide comprehensive retirement allowance
management proposals to people planning to makea new start in life following retirement.
• Biometric identification based on finger vein authentication has been introduced to enhance the securityof ATM card transactions.
• In the credit card business, an agreement was concluded with UC Card and Credit Saison to establish
a joint processing company and take other steps
toward full-scale consolidation and reorganization.
Approaches to SMEs and Middle-Market
Corporations• Mizuho e-Business Site opened for business as an
Internet banking service for corporate customers.
• Reorganization of the Corporate Banking Group
strengthened the solution support framework.
• Strengthened contacts with customers by redeploying head office personnel to branches.

mote securities sales agency business while cooperatingwith Mizuho's group companies to satisfy wide-ranging
securities transaction needs in areas like IPOs.

 UC Card
Through its strategic tie-up with Credit Saison, UC Card
has built the strongest business structure in the credit
card sector by becoming the first company in Japan to
specialize in both the management business of affiliatedmerchants and the processing business, offering highly
convenient and innovative services.

 Mizuho CapitalMizuho Capital ranks among the top domestic venture
capital companies in performance, making full use of its
rich pool of know-how and Mizuho's domestic andoverseas network in its proactive approach to investment and consulting.

27

Business Approaches Adopted by Each Global Group

Global Retail Group

Approaches to Individual Customers

Encouraging Customers to Use Mizuho as Their Main Bank
Mizuho Mileage Club
By May 2007, over 3.5 million people had signed up for MHBK's “Mizuho Mileage Club” membership service, which allows
members to accumulate points according to their usage of MHBK services. In addition to conventional services, for example,
allowing members to use ATMs in convenience stores as well as MHBK branches free of charge around the clock dependingon their transaction status, membership offers new services as follows. To make it easier for members to accumulate points,
the number of points collected for using the “Mizuho Mileage Club” credit cards was doubled based on usage. Then in
March 2007, a new campaign was launched for a limited time to quintuple the number of mileage points according to thecustomer's time deposit balance and holdings of bank debentures and public bonds. Additionally, the bank launched a number of initiatives aimed at expanding its transactions with the younger generation, including a new account opening campaign
with “BEAMS,” which has won popular support from younger people, and the introduction of original mobile phone sites.

Personal Loans
Housing Loans
To satisfy its customers' diversifying interest rate needs in respect of housing loans, MHBK has started handling its own
super long-term fixed-rate housing loans, which can accommodate refinancing, as well as the “Flat 35” long-term fixedinterest rate product, which it offers in a tie-up with Japan Housing Finance Agency (JHF). In fiscal 2006, it also proactively
increased the number of housing loan consultations held on weekday evenings, holidays and weekends at head office andbranches throughout Japan to enable customers who are busy working during the daytime to discuss loan issues in a morerelaxed atmosphere. To better accommodate customers' schedules when they need to visit a branch to sign contracts, it has
set up “My Home Plazas,” which offer extended office hours and specialize in completing contract procedures. It has also
expanded its “Housing Loan Business Promotion Centers,” which serve as specialist channels where customers consult orapply for housing loans through housing sales companies.

Unsecured LoansMHBK offers customers “Mizuho Orico Card Loans” in cooperation with Orient Corporation (Orico) to satisfy customers'
more immediate funding needs, and has simplified procedures even further by starting to accept applications via theInternet and allowing paperless contracts*. To better accommodate children's educational loan needs, it carried out a campaign offering preferential rates on such loans to coincide with the schools admissions season.
*Paperless contracts are limited to certain products.

Consulting Services that Win the Customer's ConfidenceStrengthening Consulting Services
MHBK is putting a great deal of effort into strengthening consulting services, designed to build long-term relationships withcustomers based on trust by responding more precisely to their diverse consulting needs centered on asset management. For
this reason, it has trained personnel specializing as financial consultants who are extremely familiar with customers' needs

28

GLOBAL RETAIL GROUP— Targeting Individuals, SMEs and Middle-Market Corporations —and can provide specialist consultations. It expects to increase the number of financial consultants from 2,300 as of the endof May 2007 to 3,000, and to strengthen its training program. As of the end of May 2007, it had established “Premium
Salons” to provide customers with exclusive space for consultations at 259 branches throughout the country as part of its
efforts to create an atmosphere where customers can consult its staff in a relaxed and comfortable atmosphere. In February
2007, it introduced life plan simulations as a consulting tool to allow it to estimate expenses associated with key life events,
such as education, housing and leisure, and to simulate asset plans for customers of all generations. It holds seminars on
asset management, inheritance and wills and other relevant subjects in response to the interest and concern of a wide rangeof customers. At irregular intervals, it also holds weekend/holiday consultations on asset management, and weekday afterwork consultations on asset management for people who are busy in the daytime on weekdays.

“Special Consulting Program for Retirees” Launched
MHBK has started offering services under the “Special Consulting Program for Retirees,” which provides comprehensive
retirement allowance management proposals to members of the generation who are planning to make a new start in life
following retirement. It responds to the needs of customers who are anxious about post-retirement lifestyle planning or concerned about managing their retirement allowances by offering “Money Life Simulations” and the informational magazine“The Second Act.” For customers who are considering asset investment for the first time, it offers the “Mizuho Basic Asset
Investment Package” as well as various plans, including the “Mizuho Money Plan Set — Retirement Allowance Investment
Plan” and the “Special Interest Rate Plan for Retirement Allowance Time Deposits,” which offer an additional preferential
interest rate when making retirement allowance investments. The “Special Consulting Program for Retirees” is offered by
MHTB and MHIS as well as MHBK, and the three companies held a joint seminar in March 2007.

Expanding Asset Management Products
To support customers' asset investment needs, MHBK is endeavoring to expand its product lineup in such areas as investment trusts, insurance and foreign currency deposits. It has started selling several products in the area of investment trusts.
In the second half of fiscal 2006, it launched the “Japan 3 Asset Balanced Fund (Stable Course / Growth Course)” (“Yen no
Megumi”), which diversifies its investments into Japanese equities, bonds and REITs (real estate investment trusts), and the“Mizuho Fund Series — Euro Monthly Income Fund” (“Euro no Minori”), a euro-denominated monthly diversified-type foreign investment trust that mostly makes diversified investments in Europe's bond markets. Responding to the recent increasing need for investments in emerging markets, it started handling the “HSBC China Equity Fund Quarterly Type” and the“Shinko Pure India Equity Fund.”In the area of insurance, it has started handling the “The Five-Year Plan” total annuity
receipt amount guaranteed type variable personal pension insurance, and “Everybody” lump-sum whole life insurance. It
also handles special interest rate plans for foreign currency time deposits, and gift card presents for purchasers of “Japanese
Government Bonds (JGBs) for Individuals.”

Enhancing Comprehensive Financial Services through Cooperation with Group Companies
To satisfy various needs through one-stop shopping, MHBK is working to enhance its comprehensive financial services bystrengthening its ties with the group's securities companies and trust bank. As part of its response to the need for securities services, MHIS has been setting up “Planet Booths” in the lobbies of MHBK branches, and the establishment of abooth at the Oji Branch in February 2007 brought the total to 100. It will continue to open such booths as centers foroffering a full range of securities services. MHBK also responds to the need for trust services by handling a variety of MHTB
trust products at head office and all of its branches using the agent system for trust banking business. In particular, demandis growing year by year for testamentary trust services, which provide help in preparing, keeping and executing wills, andestate distribution services, through which it undertakes complicated inheritance procedures on behalf of customers. Its
seminars on inheritance and wills are always well attended.

29

Business Approaches Adopted by Each Global Group

Global Retail Group

Expanded Channels and New Services Bring Greater Convenience
Improved Branch and ATM Services
MHBK's proactive approach has resulted in the deployment of “Mizuho Personal Squares” offering greater focus on individual customers at 90 branches as of the end of June 2007. In the largest redevelopment project in Toyosu currently underway
in the Tokyo Metropolitan Area, the Toyosu Branch “Mizuho Personal Square Toyosu” became MHBK's first branch in thearea when it opened in March 2007. In the Kansai region, new openings took place at the Ashiya Branch in July (“Mizuho
Personal Square Ashiya”) and the Gakuen-mae Branch in August (“Mizuho Personal Square Gakuen-mae”). As part of its
efforts to make ATMs more convenient, MHBK has in principle extended the opening hours of Mizuho ATM Corners to
07:00-24:00. With a few exceptions, Mizuho ATMs are open during Japan's year-end and Golden Week holidays.

Approach to i-Appli Banking
In May 2007, MHBK worked together with NTT DoCoMo to launch its response to “i-Appli Banking,” a mobile banking system that uses a specialist mobile phone software known as “i-Appli®.” Utilizing the features of i-Appli to realize colorful,easy-to-understand screen displays and high operability levels allows customers to accomplish mobile banking operations
such as account balance checks and money transfers quickly and simply. Some mobile phone models come with i-Appli
Banking pre-installed as standard. MHBK is now looking into gradually extending banking services that use specialist mobile
phone applications to other mobile phone companies in the future.
*“i-Appli” is a registered trademark of NTT DoCoMo and “i-Appli Banking” is an “i-Appli” provided by NTT DoCoMo.

Foreign Currency Conversion Service Offered in Cooperation with ANAMHBK has tied up with All Nippon Airways (ANA) in offering a foreign money exchange service whereby customers canobtain U.S. dollars, euros and Chinese yuan from foreign currency change machines installed in the ANA Lounge for passengers departing on ANA international flights at Narita International Airport's Terminal 1.

Responses to Changes in the Social Environment
Website Renewal
MHBK is promoting the Heartful Project with a view to “becoming a bank that is user-friendly to everybody.” As part of this,it renewed its website in December 2006 to increase its accessibility and usability for all. To enable users with disabilities andthe elderly to make use of the website without difficulty, it equipped the site to support “talking browsers” and changes infont size, and moved frequently-used information to the top of the page to allow speedier access. In March 2007, it also
renewed its websites for mobile phones of i-Mode, EZweb and Yahoo!, and started introducing new information and providing more detailed information concerning products and services.

30

GLOBAL RETAIL GROUP— Targeting Individuals, SMEs and Middle-Market Corporations —Targeting SMEs and Middle-Market Corporations

By strengthening its efforts to further promote its solutions businesses in response to customers' diverse needs, and to create a larger and more stable profit base for the future, MHBK aims to become the top bank in terms of both share of transactions with SMEs and middle-market corporations, and providing solutions for them.

Strengthening Proposal Capabilities and Customer Contact Points
MHBK has established a solutions business promotion framework to enable it to respond to the varied and sophisticatedneeds of SMEs and middle-market corporations, and offer highly specialized services. By reviewing its existing branch network and redeploying its highly specialized RMs (relationship managers), it will build up a framework that will allow it tooffer even more expert services. At the same time, it will further strengthen its points of contact with customers by strategically redeploying head office personnel with rich operational experience to branches. It believes that building this kind of
proactive business promotion framework will enable it to make the most of its strengths in a wide range of areas, from consulting on asset management to improving the efficiency of settlement operations and making proposals on management
issues, as well as funding.

Approach to Funding Needs
In order to respond proactively to funding demand among SMEs and middle-market corporations, MHBK is working to
expand the ¥1 trillion “Super Wide” strategic loan fund and other products in the “Partner Series” of unsecured loan products as a means of satisfying the varied needs of companies of all sizes. It is making every effort to develop products that
respond precisely to customers' needs. These include “earthquake disaster finance,” which makes funding lines available inresponse to the type of funding demand envisaged at times of earthquakes and other disasters, and “environmentally awarefinance schemes“ that offer preferential interest rates to support environmentally conscious customers. It is also developing
and offering new loan products that do not rely excessively on real estate collateral or personal guarantees, proposing loan
asset securitization schemes from the perspective of balance sheet controls and making asset-based lendings that use
accounts receivable or inventories and other operating revenue assets as collateral. Additionally, it is improving its responses
to new business funding needs by, for example, devising schemes to exploit intellectual property rights.

Alliance with Orient Corporation
MHBK is making use of the credit enhancement capabilities offered by Orico and the debt servicer know-how offered by
Japan Collection Service, a member of the Orico group, to develop a number of unsecured loan products for SME customers
and respond promptly to their borrowing needs.

Approach to Small-Scale Corporate Customers
MHBK is proactively engaged in the lending business, and has concentrated its overall lending operations for small-scalecompanies in Mizuho Business Financial Center, a subsidiary specializing in lending. Mizuho Business Financial Center has
increased its staff to 600, most of them veterans who are well versed in the lending business, and works proactively to31Business Approaches Adopted by Each Global Group

Global Retail Groupsatisfy the funding needs of small-scale customers through loans with guarantees from the Credit Guarantee Corporation
and unsecured loan products in cooperation with Orico. Together with MHRI, it has also started the Mizuho Business
Channel, a service for providing useful management information to customers of the Mizuho Business Financial Center.

Solutions Business for SMEs and Middle-Market Corporations
Further Promoting the Solutions BusinessA team of approximately 350 MHBK professionals specializing in corporate banking is working together with its branches toprovide solutions that make the most of the bank's expertise as a specialist in transactions with SMEs and middle-market
corporations. The solutions offered are very diverse, ranging from financing deals in areas like structured finance and syndicated loans to solutions associated with business strategies such as business inheritance, M&As and business matching, andadvisory services on overseas business expansion. In April 2007, MHBK reorganized its Corporate Banking Group to enable it
to offer solutions to customers' increasingly diverse and sophisticated management issues and needs more rapidly. Morespecifically, it concentrated its customer business strategy support functions into the ALC Advisory Division, creating amore centralized organization for dealing with M&A and MBO needs associated with business inheritance. It has brought
together its functions for providing solutions to foreign currency transactions in the International Operations Division, creating a domestic/overseas support organization that can seamlessly handle customers' overseas business expansion needs
as well. Organizational improvements like this leave MHBK better able to offer highly specialized solutions more proactively
than before.

Sales Launched at Mizuho e-Business Site
MHBK is using IT and the Internet proactively to create and develop new business areas from a medium- to long-term perspective, and thus meet customers' needs for more efficient settlement operations. Mizuho e-Business Site opened for business as an Internet banking service for corporate customers in fiscal 2006. Its service content has been enhanced to coveroverseas remittances, foreign currency deposits, import letters of credit and foreign exchange contracts, as well as domestictransactions such as general remittance and balance checking services. It has also strengthened its security functions, adopting electronic certification to confirm customer identities and other measures when using the services.

Business Matching
MHBK is proactively engaged in business matching services for introducing customers of Mizuho who best satisfy the business needs of other customers. These include introducing new sales and purchasing partners, and partners who will help in
reducing costs. Whether it is a matter of developing new products, diversifying the business, increasing logistical efficiency,
computerizing operations, or creating an environmentally-friendly system within the company, MHBK delivers strategic business solutions by using its extensive network and experience to provide truly effective advice and support in connection withthe various management issues customers face. “Business Matching Forums” are designed to bring corporate customers
together to engage in individual business negotiations, and have been extremely well received.

Defined Contribution Pensions
Environmental changes arising from the scheduled abolition of Tax-Qualified Pension Plans and the consolidation of pension
schemes through M&A have presented customers with the need to restructure their corporate pension schemes. In
response, the Corporate Planning Division's Defined Contribution Pension Office offers integrated services extending fromfeasibility studies to actual introduction, management and administration. These services cover pension consulting centeredon defined contribution pension schemes, support for introducing these schemes, investment products and aftercare for

32

GLOBAL RETAIL GROUP— Targeting Individuals, SMEs and Middle-Market Corporations —policyholders. MHBK also provides support for various defined contribution pension schemes to suit a variety of requirements, including the Mizuho “SogoGata (comprehensive package) DC Plan” for SMEs and the “Mizuho Personal DC Plan”
for individuals.

Securities Sales Agency Business
Now that MHBK handles securities sales agency business aimed at corporate customers, the bank itself is able to respondproactively to customers' diversifying investment needs by engaging in areas that were once the exclusive province of securities companies, such as solicitation and agency business in connection with structured bonds and other instruments. The
Asset Management Office for Corporate proposes solutions to corporate customers' investment needs, and its expert staff
offer securities and other investment products to suit customers' requirements.

Mobilizing Group Strengths
 Responding to Business Inheritance Needs
Business inheritance is an extremely important management issue for the owner-managers of SMEs and middle-market corporations. In October 2005, MHBK set up the Corporate Consulting Office within the Corporate Banking Group to specialize
in providing consultation on business inheritance. In cooperation with MHTB and other group companies, it offers bold,high-quality proposals for dealing with customers' individual needs in such areas as the inheritance of management rights
and business restructuring.

 IPO Support
MHBK responds to the needs of customers planning IPOs through organized collaboration with other group companies:
Mizuho Capital serves as a venture capital investor and provides advice on going public; MHIS provides broadly based support as a securities company; and MHTB provides advisory and stock transfer agency services.

MHIS's IPO Support Business
MHIS responds proactively to the IPO needs of the group's SME and middle-market corporation customers in cooperation with MHBK, MHTB and Mizuho Capital.
MHIS sharply improved its performance in fiscal 2006 as it served as lead manager for a total of 22 companies andwas involved in underwriting approximately 40% of the 187 new listing companies.

 Support for New Businesses
In the new business market, MHBK's know-how is far superior to that of other banks. Specialist staff with expert knowledge
concerning advanced technologies, intellectual property rights and other areas of the new business market conduct analyses
from various perspectives, including the future potential of the customer's business itself. Based on a true understanding of
the situation, they then provide proactive support for the business growth and funding of those customers who will become
the next generation of businesses.

 Support for Overseas Business Expansion
Japanese companies are increasingly looking abroad and while some are just moving into overseas markets, others aredeveloping businesses they have already established there. In order to satisfy these diverse needs, the bank provides proactive
support for customers' local overseas projects through the group's Asian network, which is the most extensive of any
Japanese bank. Specialist staff in Japan and overseas who are well versed in overseas business provide the best possible
information accurately and quickly according to the needs and stage of development of the business in question, for example, local feasibility study, establishment of local subsidiary, or start of operations. Its specialist staff cooperate with the relevant divisions to offer wide-ranging solutions pertaining to customers' overseas business operations, including the Mizuho
Global CMS, operational support for imports and exports, and exchange risk mitigation needs.

33

Business Approaches Adopted by Each Global Group

Global Asset & Wealth Management Group— Dealing with Clients' Demands for Asset Management and Administration —Business Environment and Overview of the Global Asset & WealthManagement Group
Against the background of structural changes to society accompanying the dwindling birthrate andaging population, as well as reforms to legislative and accounting systems, the need for asset management and administration is increasing among individuals and corporates alike.
In the world of trusts, moreover, revisions to the Trust Business Law in December 2004 lifted restrictions limiting the assets that could be placed in trust, and expanded the scope for trust agents and thebusiness they can handle. Revisions to the Trust Law in December 2006 allowed new formats, such as
purpose trusts, leading to a steady increase in the number of opportunities to offer solutions that makeuse of trust functions.
The Global Asset & Wealth Management Group provides world-class products and services to meet
diverse and sophisticated client needs in the areas of trust and custody services as well as privatebanking services.

34

GLOBAL ASSET & WEALTH MANAGEMENT GROUPKey Group Companies

Highlights

 Mizuho Trust & Banking

 MHTB

Trust banks may engage in trust business and related• The number of testamentary trusts entrusted to
MHTB increased steadily, exceeding 12,000 contracts as of the end of March 2007.

operations as well as banking business. One particularfeature that sets trust banks apart from other banks istheir asset management function, which allows them tomanage and administer clients' assets.
MHTB offers a full range of trust services to individual and corporate clients, and is working on strengthening its asset administration divisions, handling pensions,asset management, real estate, securitization and stocktransfer agency business.

 Trust & Custody Services BankTCSB is a highly specialized trust bank focusing on asset
management services, offering high-quality, high valueadded trust and custody services to financial institutions
and institutional investors.

• The balance entrusted to the “Noteless” lump-sum
accounts receivable trust scheme exceeded ¥1.5
trillion.
• The balance of securitized assets (real estate) underadministration increased by ¥0.5 trillion to ¥4.7
trillion.

 TCSB• The balance of assets under management exceeded¥200 trillion as of the end of March 2007

 Asset Management Companies• On July 1, 2007, Dai-Ichi Kangyo Asset Management
and Fuji Investment Management merged to
become Mizuho Asset Management.

 Asset Management Companies
Mizuho's asset management companies Mizuho AssetManagement (merger between Dai-Ichi Kangyo AssetManagement and Fuji Investment Management) andDLIBJ Asset Management constantly pursue optimal
investment results in both the investment trust and theinvestment advisory businesses as they strive to respondaccurately to clients' increasingly diverse and sophisticated asset management needs.

 Mizuho Private Wealth Management
As a full-fledged private banking services company,
MHPW provides optimal, high-quality comprehensive
and integrative products and services tailored to theneeds of individual clients.

35

Business Approaches Adopted by Each Global Group

Global Asset & Wealth Management Group

Expanding the Trust Market
In the years since the Trust Law and the Trust Business Law were enacted in 1922, money trusts, securities trusts and otherforms of trusts have made an enormous contribution to the lives of the Japanese people.
In December 2004, the system underwent the change when the revised Trust Business Law was passed. This abolishedrestrictions that had originally limited the assets that could be placed in trust to six categories, including money and land,
and made it possible to place intellectual property rights such as copyrights in trust. For all practical purposes, only financial
institutions were originally allowed to participate in the trust business, but it has now been opened up to ordinary businesscorporations and the scope for adopting the agent system for trust businesses has been expanded. The revisions to the Trust
Law of December 2006 rationalized the trustee's obligations, enhanced the effectiveness and flexibility of the beneficiary to
exercise rights, took other steps to strengthen discipline, and allowed new formats, such as purpose trusts. This means thetrust function has come into much more general use and the trust market is expected to grow further.
MHTB sees expansion of the trust market as a new business opportunity and will provide Mizuho clients with sophisticated trust solutions.

Sophisticated Trust Solutions
Testamentary Trusts
In contemporary Japan, the advent of an aging society with

MHTB's Testamentary Trusts Entrusted(No. of deals)

falling birthrates, and a heightened awareness of individual

12,500rights have fueled an increase in the number of inheritance

12,000problems. Each year, more and more clients are making use of

11,500

the trust banks' testamentary trust business as a means of pre-11,000venting such inheritance problems from arising.
MHTB's testamentary trust business covers three services:

10,500consent to allow the bank to undertake the execution of wills
so that their provisions are fulfilled; will custody trust services;and entrustment by all heirs to allow the bank to act as theiragent in the inheritance and thus the distribution of the estate.
As of the end of March 2007, over 12,000 clients had entrusted MHTB with their wills, thereby placing the futures of theirfamilies in its hands where asset inheritance is concerned.

360March 2005

March 2006

March 2007

GLOBAL ASSET & WEALTH MANAGEMENT GROUP— Dealing with Clients' Demands for Asset Management and Administration —Securitization of Monetary Claims and Other Claims
MHTB makes full use of its trust functions in developing and proposing stable asset securitization schemes on an ordermade basis.
Utilizing the high-level structuring capabilities it has built up on the basis of its strong track record, MHTB offers various
solutions to corporate clients' needs for fund procurement, cutbacks in assets and liabilities and better financial indices. As aresult, the balance of monetary claims in trust stood at ¥7.0 trillion at the end of March 2007.
MHTB led the industry in developing the “Noteless” lump-sum accounts. The scheme is that accounts receivable are
accepted in trust from clients who have transactions with large enterprises in such a way as to provide them with a service
that allows due-date collections and pre-maturity conversion into funds of the receivables in question. “Noteless” has beenwell-received because it reduces the cost of issuing notes and allows fund procurement on more favorable terms than discounting bills. At the end of March 2007, over 110,000 companies used “Noteless” accounts and the balance of funds inthese accounts exceeded ¥1.5 trillion.
At the same time, MHTB provides new investment instruments in the form of asset securitization products to investors
with asset investment needs. The “Chochiku no Tatsujin” automobile loan securitization product for individuals has beenwell-received because it focuses on balancing safety with profitability, and its outstanding sales topped the ¥700 billion
mark as of the end of March 2007.

Real Estate Securitization
In recent years, real estate securitization has come into increasingly active use because of the need to overhaul strategies
relating to real estate holdings in response to changes in thebusiness environment. These include the growing need to

MHTB's Securitized Assets (Real Estate) under
Administration as Trustee(Trillions of yen)5

make more efficient use of assets, and the diversification offund investment and procurement needs.

4

Fully utilizing the know-how it has built up over many
years, MHTB is engaged in many securitization deals involving

3

office buildings and commercial facilities. At the same time, itis proactively engaged in real estate development methods
that utilize securitization mechanisms. MHTB's capabilities and0March 2005

March 2006

March 2007

performance in arranging real estate securitization deals haveearned high marks among Japanese and overseas rating agencies and investors. As of the end of March 2007, it boasted abalance of over ¥4.7 trillion in securitized assets under administration.
It will put forward sophisticated proposals that will satisfy
all real estate needs by making the most of the overall
strengths generated through the combination of its arrangement capabilities and financial functions.

37

Business Approaches Adopted by Each Global Group

Global Asset & Wealth Management Group

Pensions Business
As the population ages and birthrates fall in Japan, Japanesecompanies now face massive retirements among baby

Retirement Benefit Funds under Administrationas Trustee

boomers as well. Securing manpower has become a crucial(Solely operated designated money trust + Pension trust +Pension specified money trust)issue, turning the spotlight once again on to the importance of(Trillions of yen)19

corporate pension schemes.

18

MHTB offers the services and product packages needed forcorporate pension schemes, which range from pension plan17

design and the management of pension policyholders and16

recipients, to asset investment and management. MHTB start-15

ed offering defined contribution pension advisory services infiscal 2006 in preparation for the switch to new pension0

schemes, which is due to get underway following the sched-

March 2005

March 2006

March 2007

uled abolition of the Tax Qualified Pension System. In order toprovide tailor-made responses to clients' increasingly diversified needs, it is strengthening its service lineup. In the area ofcomprehensive consulting services pertaining to defined benefit pension plans and defined contribution pension plans, itworks to satisfy clients' demands in cooperation with Mizuho
Pension Research Institute, which specializes in these areas.

TCSB Number One in Terms of Outstanding Assets under Management
In cooperation with the group companies of Mizuho, TCSB has
worked to expand its transactions with clients among financial

TCSB's Assets under Management(Trillions of yen)institutions and institutional investors. As a result, the balance220

of assets under management exceeded ¥200 trillion as of the200

end of March 2007, putting it in the number one position

180

among trust banks specializing in asset management services.

160

It will continue to exploit the economies of scale that result

140

from its strong base of assets under management to provide

120

high-quality, high value-added custody services that match theneeds of its clients.

0March 2005

March 2006

March 2007

Mizuho's Asset Management Performance Rated Highly
Mizuho's asset management companies have earned an excellent reputation among investment trust evaluation organizations for their investment expertise and unique product characteristics.
By offering investment products that make the most of the expertise of each company, they will continue to satisfy
clients' asset management needs.

38

GLOBAL ASSET & WEALTH MANAGEMENT GROUP— Dealing with Clients' Demands for Asset Management and Administration —Full-Scale Private Banking Services
Mizuho offers the best solutions to individual clients' diversified needs.
Mizuho Private Wealth Management is providing ultra-high-networth clients* with comprehensive and integrative services similar to those available in the U.S. and Europe to the extent permitted under Japanese laws and regulations.
Based on the open-architecture concept of “providing clients with the best around the globe,” it will continue to offer
products and services of the highest level.
With regard to non-financial services, it will provide premium services to meet clients' diverse needs in relation to art,
automobiles and similar areas, in collaboration with prestigious companies, as well as high-quality solutions in connection
with areas such as philanthropy and concierge services.
*Clients who have entrusted Mizuho with extremely large amounts of investment assets.

39

CSR Activities
As business activities expand in scope and markets become increasingly globalized, companies are expected to give greater
consideration to pro-social, pro-environmental initiatives.
Mizuho sees CSR as an indispensable element for achieving coexistence and sustainable development together with society, and promotes CSR activities while continuing an ongoing dialog with its stakeholders.
Through our core business activities, therefore, we believe it is our responsibility not only to offer high-quality, leadingedge financial products and services, but also to remain fully aware of our public mission as part of the economic and social
infrastructure, and to facilitate the flow of money and contribute to the healthy development of the economy and society inJapan and abroad.
In addition to fulfilling the responsibilities inherent in our core business activities, we will pursue corporate activities thatwill fulfill our social responsibilities through initiatives associated with our core business.
To this end, we shall specify CSR priorities for the medium to long term, and take concrete steps for its implementation.
We publish CSR REPORT with a view to promoting broader stakeholder understanding of the group's CSR policy andactivities.
The report is available on MHFG's website.
http://www.mizuho-fg.co.jp/english/csr/report/index.html

Mizuho's CSR Initiatives
We shall be fully aware of our public role
as a financial institution.

We shall adequately fulfill our responsibilities
towards the society on which our activities are based.

Through the above, as a global financial group that is trusted by society,To contribute to the healthy development of society.

To ensure our own sustainable growth
as a corporation.

Environmental Initiatives

Enhance Corporate Governance

Recognizing that restricting and reducing impact on the

Establish a corporate governance structure capable ofglobal environment is a shared challenge, provide financial

earning a reputation for excellence in global financial andservices in line with environmental policies to prevent

capital markets by maintaining honesty and integrity inglobal warming and other environmental problems, andour corporate activities.

reduce our own consumption of resources.

Highly Responsive Communications

Support for Financial Education

Conduct responsive communications with customers,

Support financial education for the next generation onshareholders, local communities, employee and otherwhom the future of society depends, to enable them notstakeholders by further promoting information disclosure

only to acquire financial awareness but also to resolve theto ensure greater transparency in corporate activities.

various issues that may arise in daily life.

Promotion of Group-Wide Approach to CSR
The group's holding company Mizuho Financial Group(MHFG) will apply an integrated group-wide approach topromote CSR activities with a view to further developing
the existing CSR activities of the group companies.

40

Lectures and Courses for Universities
Senior executive officers and employees of Mizuho who work at the cutting-edge of the finance business also act as
instructors at lectures for courses established by Mizuho at universities.
[Courses established (scheduled) for fiscal 2007]
Hitotsubashi University, Waseda University, Keio University, University of Tokyo, Kyoto University, Tokyo Gakugei
University

Practical Financial Education at Elementary and Secondary Schools
Mizuho offers practical financial education at elementary and secondary schools using the textbook “Working with
Money,” which was developed jointly with Tokyo Gakugei University. We will also make use of the recently publishedglossary entitled “Money and Our Lives.”

Environment-Related Initiatives in Business Activities
Conscious of the impact that Mizuho's busigroup companies are moving ahead withTrends in Energy Consumption and Greenhouse Gas Emissions
at Nine Key Business Facilities
Greenhouse gas emissions
Energy consumption

mental burden.
Based on the results of surveys of theenvironmental burden generated by ourown business activities, including nine business facilities in Tokyo, we are working to
reduce our greenhouse gas emissions. We
are also making steady progress with ourefforts to purchase environmentally-friendly

Greenhouse gas emissions(thousand t- CO2)

initiatives designed to reduce their environ-

150

100

3,000
2,516

2,445

2,438

101

98

98

2,115

2,109

86

85

Greenhouse gas
emissions
2,500
Target values
96

2,000
1,500
1,000

50

500
0

2002

2003

2004

2005

2006

2009

Energy consumption (TJ)

ness activities have on the environment,

0

FY

paper and stationery (green purchasing).

Creating Barrier-Free Services
Mizuho Bank is promoting multifaceted barrier-free initiatives in the form of the Heartful Project. Our goal in these
activities is to be a bank that is easy for anyone to use regardless of age, gender or disability.
The initiatives of the Heartful Project are aimed at bringing down facility-related barriers for buildings and facilities,
and other devices; service-related barriers such as in customer service, and forms, documents and Internet contents forcustomers; and psychological barriers in the minds of each and every senior executive and employee.

41Brand Strategy
We are pursuing a strategy to transform the Mizuho name into a brand that befits a leading global financial services
group.
Under this branding strategy, we will make a clear declaration of the kind of value we can provide to customers. This is
our Brand Promise.
Our Promise, however, is mere words and is not enough on its own to win customer approval for our efforts to provide
value. In order to fulfill our Brand Promise, therefore, we will share and put into practice the strengths and challenges
embodied in the expression “enterprising, open, and leading-edge” in our daily work activities.

Brand Promise
To customers ranging from domestic retail, corporate to international,
Mizuho Financial Group is comprised of enterprising, spirited professionals
who use creative and original methods to respond to customer needs today,
while helping them achieve a bright future tomorrow.
Because we want to play a meaningful role in our customers' lives
by always being available to them, we offer a full range of leading-edge products and services
designed to help them achieve their goals and make their lives more enjoyable and gratifying.

Brand Strength
EnterprisingOpen

Leading-edge“Enterprising” means we have the“Open” means we are flexible and are“Leading-edge” means we have thepassion and power to help customers

open to new ideas and new ways toforesight to “light the future.”find the right path.

serve our customers.

In other words, each of us should

We think creatively about our busi-

We listen sincerely to our customers

anticipate how society and customers

ness and each of us is empowered toand treat them with fairness and kind-change. As a result of this, we intro-

make a difference in our customers'

ness any time we have the chance.

duce the most advanced and unique

lives. We keep focused on our cus-

We want to be open all the time.

products and services to better serve

tomer needs and continuously strive to

our customers. Because of our innova-

help them achieve their dreams.

tive mindset, we help our customers

We act enterprising all the time.

achieve a better and brighter future.
We want to be leading-edge all the
time.

42

We believe we will only achieve our aspiration to become “A financial partner that helps customers shape their future andachieve their dreams” when our customers truly feel we are “enterprising, open, and leading-edge” and have fulfilled ourBrand Promise.
We will continue to declare our Brand Promise through various kinds of communications activities under the group's
unified Brand Slogan, “Channel to Discovery.”

Brand Vision“A financial partner that helps customers shape their future and achieve their dreams.”

Brand Slogan

The slogan expresses the role Mizuho will play, not only to realize today's dreams,
but also to discover new possibilities that lie ahead and to create a better future.
“Discovery” stands for Mizuho's customers discovering their dreams and new possibilities, and“Channel” stands for the role Mizuho will play in providing the ways and means to its customers
so that they can realize their dreams and new possibilities.

43

Management Structure
To ensure transparency and objectivity in personnel

Management Framework

matters relating to the board of directors and directors'

Group Management Framework

remuneration, MHFG has established two advisory bodies,

As the financial holding company, MHFG manages princi-

the nominating committee and the compensation com-

pal banking subsidiaries and other core group companies*

mittee, both of which include outside directors.

including banks, the trust bank, securities companies Corporate Auditors

directly, and other group companies indirectly via principal

MHFG has adopted a corporate auditor system consistingbanking subsidiaries and other core group companies.

of five corporate auditors, three of whom are outside cor-

Bearing in mind the basic policies formulated by MHFG,

porate auditors. The corporate auditors monitor whether

individual group companies make the most of their own

operational execution by directors is legal by attending

expertise and have established an organization that allows

board meetings and expressing their views.

them to satisfy the many and varied needs of customers

 Execution of Duties

through stronger mutual cooperation.

MHFG has adopted the executive officer system in order
to separate the managerial auditing function from the

Corporate Governance Structure

execution of duties, and clarify lines of authority andWe devote our efforts to making our corporate manage-

responsibility. The chief executive officer controls MHFG'sment more transparent and efficient and carrying out ouroverall business with ultimate responsibility for execution

business activities with integrity and fairness in conformityof duties according to the fundamental management poli-with social standards. To this end, we position compliancecies determined by the board of directors. MHFG has

as one of the fundamental principles of sound businessestablished the executive management committee tomanagement and comply strictly with all laws, ordinances,serve as an advisory body to the chief executive officer

rules and regulations.

and discuss important matters concerning the execution

 Board of Directorsof duties. It has also set up business policy committees,

MHFG's board of directors consists of nine members who

including the compliance committee, the information

set management policy and determine important matterssecurity management committee and the disclosure com-for MHFG and its group companies, and supervise themittee to facilitate the discussion and coordination ofmanner in which directors and executive officers fulfill

company-wide issues of concern to the executive officers.

their duties. Three of its members are outside directors

 Internal Audit Group

who participate in board meetings to strengthen the man-

MHFG has established the internal audit committee to ful-

agement and monitoring functions of the board of direc-

fill an internal audit function under the chairmanship oftors from a position that is independent of the actual exe-

the chief executive officer. The committee discusses andcution of duties.

determines important matters concerning internal audit

Management Structure of Mizuho
General Meeting of Shareholders
Executive Management
Committee

Corporate Auditors ;Board of Corporate Auditors

Business Policy Committees• Portfolio Management Committee• ALM & Market Risk Management
Committee• Compliance Committee• Information Security Management
Committee• Disclosure Committee• CSR Committee

44

Board of Directors
Nominating Committee
Compensation Committee
Chief Executive Officer

Internal Audit Committee

on the basis of the basic policy determined by the board

Based on our principal banking subsidiaries and otherand reports all decisions made by the committee to thecore group companies, MHFG is making efforts to opti-

board. To ensure independence of the internal audit func-mize its business portfolio, managing profits through thetion from the audited sections, we separate the Internalfollowing:

Audit Group from the groups which it audits and establish• formulating plans for net business profits and net

it as an independent group in its own right under the con-income, and carrying out performance management,

trol of the internal audit committee. Outside specialists• allocating management resources such as personnel,(one lawyer and one accountant) participate in the internal audit committee as special members to reinforce its
expertise and objectivity.

investment and risk capital, and• risk controls and profitability assessments based onallocation of risk capital.

*Principal banking subsidiaries and other core group companies:
MHCB, MHBK, MHTB, MHSC, MHIS, TCSB, Dai-Ichi Kangyo Asset Management(DKA), Fuji Investment Management (FIMCO), DIAM, MHRI, MHIR, MHFS,

Further, our principal banking subsidiaries and certain
other core group companies establish their own profit
plans for and manage the performance of their respective

MHPW
On July 1, 2007, DKA and FIMCO merged to become MHAM.
(As of June 26, 2007)

company's business group/units based on the management policy, overall profit plans and resource allocations
drawn up by MHFG.
The above group companies have also introduced theallocation of risk capital among each company's businessProfit Management Systemgroups/units, which is one of the most important management frameworks of the group. Each group company

Profit Management System Based on Legally
Separate Subsidiaries in Accordance with
Customer Segmentation and Business Functions

engages in business activities within the limits of that risk
capital and RAROC is then used as a performance index toevaluate the return on allocated risk capital.

We have adopted the basic policy of reinforcing our

Basically, the group companies have adopted a com-financial strength by vigorously increasing profitability

mon profit management system and framework, but inand cutting costs. Centered on MHFG, we conduct profit

actual operations, each takes a flexible and swift approach

management for the group based primarily on our princi-

best suited for its individual business models.

pal banking subsidiaries and other core group companies.
More specifically, we have clarified the strategic posi-

Consolidated Profit Management

tions of our principal banking subsidiaries and other core

While each principal banking subsidiary or core group com-group companies within the group on the basis of ourpany works to enhance its own profitability, we manage

group business portfolio strategy and, having ensured

their profits on a consolidated basis as a means of build-

their autonomy and independence while bringing theming an optimal business portfolio that is balanced for thecloser together through the unifying force of MHFG, weentire group.

are seeking to maximize group corporate value.

Specifically, in addition to our principal banking subsidiaries and other core group companies, we formulate

Risk capital allocation

Allocation of risk capital to our principal banking subsidiaries and other core group companies

Management resources allocation function

Risk-based profitability assessments

Risk control function

Management to preserve allocated risk capital

45

Management Structure

profit plans and manage performance for the strategically

Human Resources System

important subsidiaries and include their profits with thoseof our principal banking subsidiaries and other core groupcompanies.

Vision for Human Resources: ROE on Human
Resources Investment
The group and its employees have set a shared vision for

Allocation of Risk Capital

human resources as follows:

In an environment where the financial sector faces pro-

“We promote the ‘ROE’ principle for human resources

gressive deregulation and globalization, and financial

with a view to lasting value creation and creating an attrac-

technology is growing in sophistication, financial institu-

tive and fulfilling working environment for employees.”

tions must strengthen their profitability while managing

In this vision, “ROE” stands for the following:

various types of risk.
Based on MHFG's business portfolio strategy, we have

ROE on Human Resources Investment

built a management structure under which optimized
Responsibility:

Observe the principles of
independent judgment andself-accountability.

Opportunity:

Provide equal opportunity.

Employability:

Develop expertise to enhancecompetitiveness.

business activities are conducted within the limits of allocations of risk capital drawn from equity capital and othersources.
Under this framework, RAROC is used as an index toevaluate performance in terms of return on allocated risk
capital at the level of the holding company and our principal banking subsidiaries and other core group companies.
Our aim as a group is to improve capital efficiency by allocating resources more efficiently based on the results ofthese evaluations.
Glossary

Establishing a Corporate Culture Full of Vitality

 RAROC (Risk-Adjusted Return on Capital)
RAROC is a measure of the profitability of allocated capital and is used as anindex for assessing capital efficiency. RAROC is calculated by dividing riskadjusted profits (profits adjusted to reflect statistically expected risk) by capital.
(As of June 26, 2007)

We have established the following five values as thegroup's common code of conduct. These values, serving as
the axis of our personnel evaluation system used by general managers, along with the 360-degree employee performance evaluation*, are being instilled in all employees of
the group.
(1) Possessing a “customer-first” corporate objective.
(2) Facing the challenges of innovation.
(3) Being rational and fair in making decisions.
(4) Placing importance on speed.
(5) Being accountable for all actions.
*Personnel evaluation scheme whereby personal evaluations of managers
involve subordinates and persons from other divisions with whom they
have close working relationships.

46

We also introduced a group-wide “job application sys-

Optimizing the Uniqueness of Group
Companies and Synergiestem” and a “rookies' job request system“ for young

Employees are employed by one of the group companies

employees who have not experienced personnel transfers(MHFG, MHCB, MHBK, MHTB, MHSC, MHIR) with the aim

to encourage employees to acquire greater specializationof creating a group of specialists that can deliver maxi-

in which employees can apply for specific positions

mum innovativeness and speed.

throughout the group. We intend to strengthen thisAt the same time, facilitated by the group's common
compensation system (group-wide common platform for

scheme further by expanding the number of positions
available for the “job application system.”

human resources), we are able to maximize group synergy
through cross-company personnel transfers to place thePositive Action Initiatives

right person in the right job.

With the aims of invigorating our organization by proactively recruiting women, and of improving the morale ofPromoting the “Professional Career Path”

female employees, we are taking joint measures in our

We have put in place multi-featured compensation sys-

approach to positive action*.

tems that meet the needs of employees and the increas-*Initiatives that a company adopts proactively and autonomously in order toeliminate gender discrimination in recruitment and to promote the utilization of
womens' capabilities to the fullest extent possible.

ingly fluid labor market.
One example is the promotion of the “Professional
Career Path,” with a salary system that is in line with market standards.

Note: Contents appearing in this section describe the group's human resources
system in Japan.
(As of June 26, 2007)

Rejuvenating the Organization and Pursuing
Specialization
In January 2003, we launched an internal job application
system for branch general manager positions to encourage
the quick development and advancement of younger
employees. As of May 31, 2007, we achieved a dynamic
rejuvenation of the organization by selecting 54 applicantsin their thirties and appointing them as branch generalmanagers.
Common Platform for Human Resources
MHFG

MHCB

MHBK

MHTB

MHSC

MHIR

Management-class platform
Reflect the independenceof each group company
through market pricing,risk/return structure
and value-added.

Promote cross-company personnel exchanges using a portable retirement benefits system, etc.,
while maintaining the culture and autonomy of each group company.

Proactive personnel exchanges across group companies.

CommonPlatform

Welfare benefits platform(Health insurance association, employees' pension funds, cafeteria plan, etc.)
Human resources framework platform(Job groups, job grades, job application system, etc.)

47

Internal Control Systems
Compliance Structure

unit, and the compliance officer or the compliance administrator at each unit reviews the status of compliance.

Basic Compliance Policy

MHFG has established the Internal Controls and Audit

We are acutely conscious at all times of our social respon-

Hotline, a system designed for obtaining concerns regard-

sibilities and public mission as Japan's leading comprehen-ing questionable accounting or auditing matters from insive financial services group. We, therefore, work to

and outside the company.

ensure that we observe all laws and regulations, and pur-

Other core group companies such as MHTB and MHSC

sue corporate activities in a fair and honest manner thathave also established compliance structures adapted toconform to the norms accepted by society.

the characteristics of their respective businesses.

Placing thoroughgoing compliance as one of the fun-

MHFG monitors the status of compliance of the group

damental principles of sound business management, eachthrough reports submitted by our principal banking sub-group company pursues compliance and establishes its

sidiaries and other core group companies and adopts

own compliance structure in line with the basic policies

appropriate responses when necessary.

indicated by MHFG.

Compliance at subsidiaries of our principal banking
subsidiaries and other core group companies is monitored

Compliance Structure

and managed by their respective parent.

The chief executive officer of MHFG, MHCB and MHBK
each generally oversees compliance matters of the respec-

Compliance Activities

tive company, and such chief executive officers also head

We have established the “Mizuho Code of Conduct,”their respective compliance committees at which impor-which sets forth clear and concrete standards of ethicaltant matters concerning compliance are discussed. The

behavior, and distributed it to all directors, senior man-three companies also have individual compliance divisions

agement and employees of the group so that they are

under a chief compliance officer. These divisions arewell aware of its content and act accordingly.

responsible for compliance planning and implementation

Each of our group companies has also prepared a com-and control overall compliance management at thepliance manual, which serves as a practical guidebook forrespective companies. At the level of each organizational

rigorous compliance enforcement and clarifies the laws

unit (such as branches and divisions) at the three compa-

and regulations that the group companies must observe innies, the head of the unit is responsible for guidance andpursuing their business activities and the compliance activ-

implementation related to compliance matters within suchities they are required to follow.
We conduct compliance training for directors, senior

Compliance Structure

management and employees so that they are fully

MHFG

acquainted with the contents of the manual. We monitor

Board of Directors

the status of compliance levels through primary self

Chief Executive Officer (CEO),
Compliance Committee(Chairman: Chief Executive Officer (CEO))assessments by individual organizational units and sec-

Chief Compliance Officer (CCO)(Compliance and Legal Affairs Division)
Every organizational unit
Compliance Officer/
Head of each unit
Compliance Administrator

ondary assessments by the internal audit division of eachcompany.
Every fiscal year, each of our group companies establishes a compliance program, which contains concretemeasures for compliance enforcement such as measuresrelated to the management of the compliance framework,
training and assessments. Progress regarding the imple-

MHCB, MHBK, and othercore group companies

Subsidiaries of the above group companies

48

mentation of the compliance program is monitored every
six months.

“Internal Controls and Audit Hotline”—A system designed for obtaining concerns regarding
questionable accounting or auditing matters—
Reporting Items:
MHFG has established a hotline to receive reports fromin and outside the company in connection with problems
concerning internal controls and audits of accounts andfinancial reports.
Contact Point:
This hotline has been established within an external law
office. Please use conventional mail or e-mail forreporting.
Conventional mail:
6F Round–Cross Ichibancho Bldg., Ichibancho 13-banchi,
Chiyoda-ku, Tokyo 102-0082
Mizuho Accounting Hotline, c/o Ohta Ishii Law OfficeE-mail : mizuho-kaikei@ohta-ishii.com
 When reported matters are within the scope of thereporting items, MHFG will do reasonable efforts toinvestigate the facts behind the information received
and report back on the results.
 Anonymous tips are also acceptable, but there arecases where it will not be possible to fully satisfy theintentions behind such tips owing to constraints on
investigations and the inability to report back.
 Information on persons making such reports is not disclosed to third parties except in cases where the assentof the person in question has been obtained or suchdisclosure is required under laws and ordinances, etc.
(As of June 26, 2007)

Information Security Management
SystemBasic Approach
As the advanced information-telecommunication society
evolves and use of information increases exponentially,
appropriate protection of the informational assets held by
a company becomes a social responsibility, while appropriate usage of the same assets becomes the foundation of
the company's competitiveness. As a provider of comprehensive financial services in Japan and abroad, we believethat appropriate protection and use of informational
resources are extremely important issues.
We are striving to strengthen our information security
management system, defining information security management as all acts associated with the appropriate protection and use of group informational assets. This includes
adopting information security management measures toensure the confidentiality, integrity and availability of our
informational assets, and responding to requests for disclosure from “data subjects” (the people to whom specificinformation pertains) concerning personal information.

Overview of the Information Security
Management System
We have clarified the group management system as wellas management methods for information security management, and each company has drawn up its own regulations concerning information security management. We
are also building an information security management system, stipulating that the compliance departments of theindividual companies are to act as information security
management departments.
The chief executive officer of MHFG appoints a chief
information security officer who supervises planning, proposals and implementation in connection with overall
group information security management, and the information security management committee handles discussions and coordination of cross-divisional issues relating tooverall group information security management. In addition, the Information Security Management Office has
been established within the Compliance and Legal Affairs
Division to specialize in information security management
and provide centralized monitoring and control of theinformation security management situation at our principal banking subsidiaries and other core group companies.

49

Internal Control Systems

The information security management situation at subsidiaries of our principal banking subsidiaries and othercore group companies is monitored and managed by our

MHFG Acquires Certification for
Information Security Management

principal banking subsidiaries and other core group com-

MHFG obtained certifications for the Information

panies themselves. In every organizational unit, the head

Security Management Systems of all divisions of theof each unit is also responsible for information security

company under both the Conformity Assessment

management, and an information security management

Scheme, “ISO/IEC27001: 2005,” the international

officer is appointed to check on how information is han-standard, and “JIS Q 27001: 2006,” the domestic

dled and ensure that personnel are fully aware of andstandard. MHBK also obtained the same certifica-

well trained in safety management measures.

tions for its “Planning, promotion and sales sup-Based on this information security management sys-

porting divisions of financial products and services

tem, we have drawn up and published the Privacy Policy

for individuals, corporate and public sector cus-

Regarding Customer Information* that complies withtomers” of the head office.

Japan's Law Concerning the Protection of Personal

MHFG is striving to strengthen its information

Information. We are also building a system to deal withmanagement procedures by promoting efforts torequests for disclosure, and strengthening our safety man-obtain a broader range of credentials. This includes

agement measures.

encouraging our principal banking subsidiaries and*The Privacy Policy Regarding Customer Information includes the policy and procedures for management of customer information. Our group companies haveeach established privacy policies regarding customer information, which are
published on their individual websites and via other disclosure tools.

other core group companies to acquire certificationin specific operational sectors.
(As of June 26, 2007)

Information Security Management System
Board of Directors
Chief Executive Officer
(CEO)

MHFG
Executive
Management Committee
Information Security
Management Committee

Chief Information Security Officer(Division in charge: Information Security Management
Division, Compliance and Legal Affairs Division)
Every organizational unit
Information
Head of each unit
Security Officer

MHCB, MHBK, and othercore group companies

Subsidiaries of the above group companies

50

Strengthening Disclosure Controls andProcedures

their implementation. In addition, evaluation of the effectiveness and appropriateness of Disclosure Controls andProcedures is conducted through internal audits.

Basic Principles

 Others

We aim to win the highest regard of our shareholders andWe established a “Code of Ethics for Financial Profession-

the market and to earn the trust of society as Japan'sals” to be observed by all directors and executive officers,

leading comprehensive financial services group. For thisas well as all managers and other employees within our

reason, we place one of the highest management priori-group who engage in financial reporting, accounting orties on continuing to disclose information to our cus-

disclosure. We have also developed the “Internal Controls

tomers, shareholders, and investors both in and outside

and Audit Hotline”, a system designed for obtaining con-Japan in a fair, timely and appropriate manner, in ordercerns regarding questionable accounting or auditing mat-that they may form proper judgments and appraisals ofters from both inside and outside the group (Please refer

the group. To achieve this aim, we observe applicableto page 49).

domestic and international laws and regulations as well as

Moreover, we established “Disclosure Policy” whichstock exchange rules relating to corporate disclosure, andincludes basic principles regarding disclosure and frame-

we establish and implement appropriate Disclosure

work of disclosure controls and procedures, andControls and Procedures.

announce on our website as well as this annual report.

Outline of Disclosure Controls and Procedures

Disclosure Controls and Procedures System

 Establishment and Implementation of Disclosure
Controls and Procedures
Our Disclosure Controls and Procedures are established toobserve applicable domestic and international laws andregulations as well as stock exchange rules and to implement fair, timely and appropriate corporate disclosure.

Board of Directors
Chief Executive Officer
(CEO)

MHFG
Disclosure Committee

Chief Financial Officer(in charge of Disclosure Controls and Procedures)and Other Heads of Groups

The Disclosure Controls and Procedures are the processcarried out by directors, officers and employees of ourgroup and include internal controls designed to provide

Every organizational unit
Head of each unit

Disclosure Control
Officer

reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements. We
have established the basic principles underlying our

MHCB, MHBK, and othercore group companies

Disclosure Controls and Procedures as well as our internal
rules related to Disclosure Controls and Procedures thatgovern the management framework for the entire group

Subsidiaries of the above group companies

including group companies, and we endeavor to establish,
implement and continuously improve our Disclosure(As of June 26, 2007)

Controls and Procedures. Our disclosure committee is theprincipal management body that is responsible for discussing and exploring matters relating to Disclosure
Controls and Procedures.

 Evaluation of Effectiveness of Disclosure Controls
and Procedures
Our Disclosure Controls and Procedures are documented,
and evaluation of the overall effectiveness of our
Disclosure Controls and Procedures is conducted regularly
by reviewing the contents of such documentation and51

Internal Control Systems

appropriate instructions concerning risk management. Our

Risk Management Structure

principal banking subsidiaries and other core group com-Commitment to Risk Management

panies each maintains its own system for managing various types of risk, regularly receiving reports on the status

Basic Approachof risk at their respective subsidiaries, and gives them

Progress in financial deregulation and internationalization

appropriate instructions concerning risk management.

has led to rapid growth in the diversity and complexity ofbanking operations, exposing financial institutions to vari-

Approach to Basel II

ous risks, including credit, market operations, information

Current regulations for international standards oftechnology, legal, settlement and other risks. We recog-

the health of banks, first implemented in 1992,

nize the conducting of operations tailored to the risks andhave been revised in light of developments in risk

managing such risks as a key issue relating to overall man-

management methods in order to better reflect theagement. In order to implement our business strategy

actual substance of the risks. These amended regu-

while maintaining our financial stability, we maintain com-lations, known as “Basel II,” were implemented inprehensive risk management and control measures.

Japan beginning in March 2007.

MHFG maintains basic policies for risk management

These regulations focus on three main points.

established by our board of directors that are applicable to

The first is minimum capital requirements relating to

the entire group. These policies clearly define the kinds ofrisk which should be maintained by banks, withrisks to be managed, set forth the organizational structure

respect to which the calculation method for credit

and provide for the human resources training necessary

risk was changed and operational risk was added.

for appropriate levels of risk management. The policies

The second is a supervisory review process withalso provide for audits to measure the effectiveness andrespect to assessment of risks that cannot be fully

suitability of the risk management structure. In line withaddressed through minimum capital requirements

these basic policies, we maintain various measures toalone. The third is market discipline allowing forstrengthen and enhance the sophistication of our risk

assessment by the market through appropriate dis-management system.

closure.

Risk Management Structure

for the implementation of the prescribed proce-

Each of our subsidiaries adopts appropriate risk manage-

dures and in March 2007 obtained the necessary

ment measures for its business based on the size andapprovals of regulators with respect to the use ofnature of its risk exposures, while MHFG controls risk

calculation methods for each type of risk. In addi-

management for the group as a whole. MHFG regularlytion, we are moving forward with a plan to transi-

receives reports and applications concerning the risktion to advanced approaches for the calculation ofmanagement situation from our principal banking sub-credit risk and operational risk.

Based on the principles of Basel II, we preparedsidiaries and other core group companies and gives them
Risk Management StructureManage overall group risk
Manage risk of core group companies
Set risk management policies.
Give instructions concerning
risk management.

MHFG
Report therisk management situation.

52

Principal banking
subsidiaries and othercore group companies
MHCB
MHBK
MHTB
, etc.

Give instructions
concerning
risk management.

Report the risk
management situation.

Subsidiaries
managed by theprincipal banking
subsidiaries andother core groupcompanies

General Concept of Risk Management

ensure that the overall risk we hold on a consolidated
basis does not exceed shareholders' equity and other

Basic Approachmeasures of financial strength. To ensure the ongoing

We classify our risk exposures according to the various

financial health of MHFG, our principal banking sub-kinds of risk, including credit risk, market risk, liquidity risk

sidiaries and other core group companies, we regularly

and operational risk, and manage each type of risk

monitor the manner in which risk capital is being used inaccording to its characteristics.

order to obtain a proper grasp of the risk profile within

In addition to managing each type of risk individually,

this framework. Reports are also submitted to the board

we have established a risk management structure to iden-of directors and other committees of each company. Risk

tify and evaluate overall risk and, where necessary, tocapital is allocated to MHCB, MHBK, MHSC and MHTB bydevise appropriate responses to keep risk within limits thatrisk category, and is further allocated within their respec-

are managerially acceptable in both qualitative and quan-tive business units based on established frameworks.

titative terms.
In line with the basic policies relating to overall risk

Credit Risk Management

management laid down by MHFG, companies within thegroup identify risk broadly and take a proactive and sophis-

Basic Approachticated approach to risk management, including method-

We define credit risk as the group's exposure to the risk ofologies for operations that involve exposures to multiple

losses that may be incurred due to a decline in, or total

categories of risk such as settlement and trust businesses.

loss of, the value of assets and off-balance-sheet instruments, as a result of deterioration in a counterparty's

Risk Capital Allocation

financial position. We have established the methods andWe endeavor to obtain a clear grasp of the group's overall

structures necessary for grasping and managing credit

risk exposure and have implemented measures to keep

risk, which has become increasingly complex due to finan-such risks within the group's financial base in accordance

cial deregulation, internationalization and the growing

with the risk capital allocation framework.

sophistication of transactions.

More specifically, we allocate risk capital to our princi-

MHFG manages credit risk for the group as a whole.

pal banking subsidiaries, including their respective sub-More specifically, we have adopted two different but mutu-

sidiaries, and other core group companies to control risk

ally complementary approaches in credit risk management.

within the limits set for each company. We also control

The first approach is “credit management,” in which werisk within managerially acceptable limits by working tomanage the process for each individual transaction and

Allocation of Risk Capital(Example)
MHCB

MHFG
The group's risk
exposure
MHCB

Capital account, etc.

Principal
banking
subsidiaries
and othercore groupcompanies'
risk exposure*

MHBK
MHTB

Allocated risk capital

The group's financial
strength

Risk limits, etc., based on risk capital are set, and controls are
imposed on each type of risk.

Credit risk
Market risk

Allocation toeach business unit

Equity risk
Operational riskGroupcompanies, etc.

MHSC

Other risk exposure*Including risk exposures of the subsidiaries of the core group companies.

MHBK
MHTB
MHSC

53

Internal Control Systems

Through this process, we curb losses in the case of a

 Credit Risk Management at Our Principal
Banking Subsidiaries and Other Core Group
Companies

credit event. The second is “credit portfolio manage-

MHCB, MHBK and MHTB (principal banking subsidiaries)

ment,” in which we utilize statistical methods to assess

and other core group companies manage their credit risk

the potential for losses related to credit risk. Through thisaccording to the scale and nature of their exposures inprocess, we identify credit risk and respond appropriately.

line with basic policies set forth by MHFG. Each com-individual obligor from execution until collection, basedon our assessment of the credit quality of the customer.

pany's board of directors determines key matters pertaining to credit risk.

Credit Risk Management Structure

Principal banking subsidiaries have each established Credit Risk Management of MHFG
Our board of directors determines the group's basic credit

business policy committees to discuss and coordinate

risk management policies. In addition, the portfolio man-overall management of their individual credit portfolios

agement committee of MHFG discusses and coordinates

and transaction policies towards obligors. The senior exec-

basic credit risk policy and overall credit portfolio manage-

utive officer of each principal banking subsidiary responsi-

ment and monitoring for the group. The chief risk officer

ble for risk management oversees matters relating toof MHFG is responsible for matters relating to credit risk

credit risk management planning and operations. The

management planning and operations. The Risk Manage-credit risk management division of each principal banking

ment Division and the Credit Risk Management Division ofsubsidiary is responsible for credit management and credit

MHFG jointly monitor, analyze and submit suggestions

risk measuring and monitoring, and such division regularly

concerning credit risk and formulate and execute plans inpresents reports regarding the risk management situation

connection with basic matters pertaining to credit riskof such banking subsidiary to MHFG. Individual credit

management.

examination divisions approve individual transactions inaccordance with the lines of authority set forth in theCredit Risk Management Structure

basic policies for credit risk management. To provide

MHFG

Board of Directors

checks and balances, each of our principal banking subsidiaries have also established credit review divisions toChief Executive Officer(CEO)
Head of Risk Management
Group (CRO)

Executive Management
Committeefunction as internal auditors that are independent of thePortfolio Management
Committee

business divisions.

 Individual Credit Management
Our principal banking subsidiaries use a unified internal

Risk Management Division, Credit Risk Management Division

rating system and credit risk measurement tools to ascertain and monitor the status of their portfolios. They are•Set risk management policies•Give instructions concerning
risk management

MHCB•Report the risk
management situation

also improving their credit decisions and post-transaction
management functions by examining individual transac-

Principal banking subsidiaries andother core group companies

tions from these viewpoints, providing internal audits andOther coregroup
companies

tion offices. MHSC and other core group companies fol-

MHBK

MHTB

MHSC

risk management guidance to individual business promolow credit risk management procedures that suit the characteristics of their respective business sectors.

Board of Directors

Chief Executive Officer
Senior executive officers
responsible for risk management

Principal Banking
Subsidiaries
Executive Management
Committee
Business Policy Committees

Divisions responsible for credit risk management(Risk Management Division, Credit Risk Management Division)54

 Credit Policies
The basic code of conduct for all of our officers andemployees engaged in the credit activities is set forth inour credit policies. Seeking to fulfill the bank's public andsocial role, our basic policy for credit activities is determined in light of fundamental principles focusing on publicwelfare, safety, growth and profitability.

Connection between Obligor Ratings, Definition of Obligor Classifications of Self-Assessments,
Claims Disclosed under the FRL and Non-Accrual, Past Due & Restructured Loans
Definition of
ObligorObligor Classifi- Ratings
cations of Self- (Major
Assessment
Category)

Definition of Ratings

Category I(NonCategorized)

Category II

Category III

Claims Non-Accrual,
Category IV
Disclosed Past Due &(Nonunder the RestrucCollateralized)
tured Loans
FRL

Obligors whose certainty of debt fulfillment

A1–A3 is very high, hence their level of credit risk is
excellent.
Obligors whose certainty of debt fulfillment poses

B1–B2 no problems for the foreseeable future, hence
their level of credit risk is sufficient.

NormalObligors
C1–C3

Obligors whose certainty of debt fulfillment
and their level of credit risk pose no problems for the foreseeable future.

All credit given
to Normal
Obligors.

NormalClaimsObligors whose current certainty of debt fulfill-

D1–D3 ment poses no problems, however, their resistance to future environmental changes is low.

E1
Watch
Obligors

E2 R

Intensive
Control
Obligors

F1

Substantially
Bankrupt
Obligors

G1

Bankrupt
Obligors

H1

Obligors who require close watching going
forward because there are problems with
their borrowings, such as reduced or suspended interest payments, problems withfulfillment such as de facto postponements
of principal or interest payments, or problems with their financial positions as a resultof their poor or unstable business conditions.

Credit given to
Watch Obligors
other than thoseincluded in
Category I.

Claims forSpecialAttention

Restructured
Loans
Loans Past Duefor 3 Months
or MoreObligors who are not yet bankrupt but arein financial difficulties and are deemed to bevery likely to go bankrupt in the future
because they are finding it difficult to makeprogress in implementing their management
improvement plans (including obligors who
are receiving ongoing support from financial
institutions).

Credit given to
Credit toIntensive Conobligors which
trol Obligors
Claims withhas pledgedother than thoseCollection
collateral or is
included in CatRisk
covered byegory I and Catguarantees,
Non-Accrual
egory
II.
considered ofDelinquent
Credit to oblighigh quality,
Loans
ors which is cov- The differencesuchasdepositObligors who have not yet gone legally or
Credit to Bankeredbygeneralbetween theformally bankrupt but who are substantially collateral.
collateral, such assessed value and rupt and Substan- Claims
bankrupt because they are in serious finantially Bankrupt
as real estatemarket value of colcial difficulties and are not deemed to beagainst Bankand guarantees. lateral on credit to Obligors, othercapable of restructuring.
than those in Cat- rupt and SubBankrupt and Subegory I, Category stantiallystantially Bankrupt
II and Category III Bankrupt
Obligors (i.e., the(credit that is
Obligors, and Loans toportion of loans for
Obligors who have already gone bankrupt,
judged to be
Bankrupt
equivalent
which final collection
from both a legal and/or formal perspective.
unrecoverable or
Obligors
problems or losses
without value).
are anticipated).

Method for Write-Offs and Reserves
Normal Obligors

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
for Possible 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

Substantially
Bankrupt Obligors
Bankrupt 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
based on 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.

 Internal Rating System

possibility of ultimately incurring losses related to each

One of the most important elements of the risk manage-

individual claim by taking into consideration the nature ofment infrastructure of our principal banking subsidiaries isany collateral or guaranty and the seniority of the claim.

the use of an internal rating system that consists of credit

In principle, obligor ratings apply to all obligors and are

ratings and pool allocations. Credit ratings consist of

subject to regular reviews at least once a year to reflect

obligor ratings which represent the level of credit risk ofpromptly the fiscal period end financial results of thethe obligor, and transaction ratings which represent the

obligors, as well as special reviews as required whenever a55

Internal Control Systems

obligor's credit standing changes. This enables our princi-

potential transaction within the relevant business division.

pal banking subsidiaries to monitor both individual oblig-

In case the screening exceeds the authority of the divi-

ors and the status of the overall portfolio in a timely fash-sion, the credit division at headquarters carries out theion. Because we consider obligor ratings to be an initial

screening. The credit division has specialist departments

phase of the self-assessment process regarding the quality

for different industries, business sizes and regions, carriesof our loans and off-balance-sheet instruments, suchout timely and specialized examinations based on the

obligor ratings are closely linked to the obligor classifica-

characteristics of the customer and its market, and pro-tions and are an integral part of the process for determin-vides appropriate advice to the business division. In addi-

ing the write-offs and reserves in our self-assessment oftion, in the case of obligors with low obligor ratings andloans and off-balance-sheet instruments. Pool allocations

high downside risks, the business division and credit divi-

are applied to small claims that are less than a specified

sion jointly clarify their credit policy and in appropriate

amount by pooling customers and claims with similar riskcases assist obligors at an early stage in working towards

characteristics and assessing and managing the risk forrehabilitation.

each such pool. We efficiently manage the credit risk and Collection and Disposal of Non-Performing Loanscredit screening by dispersing a sufficient number of smallWith respect to collection and disposal of non-performing

claims within each pool (Please refer to Connectionloans, a specialist unit is designed to pursue corporate

between Obligor Ratings, Definition of Obligor

revitalization or collection efforts as appropriate.

Classifications of Self-Assessments, Claims Disclosed

Specifically, this typically involves business transfers,

under the FRL and Non-Accrual, Past Due & Restructured

mergers and acquisitions, obtaining funding from business

Loans).

revitalization funds and the bulk sale of non-performing Self-Assessment, Write-Offs and Reservesloans. In addition, we concentrate our loan collection

We conduct self-assessment of assets to ascertain theneeds into Mizuho Servicing, our subsidiary that specializes

status of assets both as an integral part of credit riskin performing collection services for our group companies.

management and in preparation for appropriate accounting treatment, including write-offs and reserves. During

Portfolio Management

the process of self-assessment, obligors are categorized Risk Measurement

into certain groups taking into consideration their finan-

We use statistical methods to manage the possibility ofcial condition and their ability to make payments, andloan losses by measuring the expected average loss for acredit ratings are assigned to all obligors, in principle, to

one-year risk horizon (“expected loss”) and the maximum

reflect the extent of their credit risks. The related assets

loss within a certain confidence interval (“credit VaR”).

are then categorized into certain classes based on the risk

In establishing transaction spread guidelines for creditof impairment. This process allows us to identify and con-transactions, we aim to ensure an appropriate return fromtrol the actual quality of assets and determine the appro-

the transaction in light of the level of risk by utilizing

priate accounting treatment, including write-offs andexpected losses as a reference. Also, we monitor our credit

reserves. Specifically, the credit risk management divisionof each of our principal subsidiaries is responsible for theoverall control of the self-assessment of assets of the

Loss Distribution
Frequency

respective banking subsidiaries, cooperating with the

Averageadministrative divisions specified for each type of asset,
including loan portfolios and securities, in executing andmanaging self-assessments.

This amount depends on theconfidence interval. For
example, if the confidence
interval is set at 99%, it is the
9,900th smallest loss figureout of 10,000 trials.

 Credit Screening
Prevention of new non-performing loans through routine
Loss amountcredit management is important in maintaining the quality

Credit VaRof our overall loan assets.
Credit decisions involve analysis and screening of each

56

Expectedloss

Unexpected loss

Allocation of Risk Capital and Control of Credit Risk
Credit VaR

Allocation of risk capital
Credit concentration risk

Chain reaction default risk

 Individual company ratings-based
credit guidelines

MHCB: Sets , , , 
MHBK: Sets , , 
MHTB: Sets , , 

 Corporate group-based credit guidelines Geographical area/country-based
credit guidelines
 Industrial sector-based credit guidelines

Control

Equivalent to credit concentration risk amounts

Equivalent to chain reaction default risk amounts

portfolio from various perspectives and set certain limits

capital efficiency, boost profitability and shareholder

so that losses incurred through a hypothetical realization

value, and enhance the sophistication of their credit riskof the full credit VaR amount would be within the amountmanagement.

of risk capital and loan loss reserves.

To control credit concentration in certain companies,

 Risk Control Methods

MHTB and MHSC have set credit limits according to their

We recognize two types of risk arising from allowing too

customers' creditworthiness and control their portfolios inlarge a proportion of overall credit risk to be allocated in

an appropriate manner by adhering to these limits.

certain areas. One type is “credit concentration risk,”
which stems from granting excessive credit to certain indi-

MHCB's Credit Portfolio

vidual counterparties. The other type is “chain-reaction
default risk,” which arises from granting excessive credit
to certain corporate groups, industrial sectors and other

Other
Asia
EuropeJapan

groupings. We manage these risks in line with our specificguidelines for each. The individual risk management divi-

North America

sions of our principal banking subsidiaries are responsible
for monitoring adherence to these guidelines and reporting to their respective business policy committees (Pleaserefer to Allocation of Risk Capital and Control of Credit

MHBK's Credit Portfolio

Risk).
Other Portfolios of Our Principal Banking Subsidiaries
and Certain Other Core Group Companies
MHCB's credit portfolio is notable for its international
diversification between Japanese public companies andother major Japanese enterprises and overseas corporations. MHBK's portfolio is diversified among relatively

Domestic SMEs
and middle-market
corporations

Individuals
Publicsectorentities

small accounts centered on individuals, domestic corporations including mainly small and medium-sized enterprises(SMEs) and middle-market corporations, public sector
entities and other customers in Japan. While retaining theprincipal features of each of the two banking subsidiaries'
respective portfolios, we aim to reduce expected losses
while simultaneously utilizing sophisticated financial tools
based on which they make strategic acquisitions andsales of assets. While closely monitoring the potential for
unexpected losses, they also aim to raise overall group57

Internal Control Systems

Market and Liquidity Risk Management

risk management committee of MHFG broadly discusses
and coordinates matters relating to basic asset and liability

Basic Approach

management policies, risk planning and market risk man-We define market risk as the risk of losses incurred by theagement and proposes responses to emergencies such asgroup due to fluctuations in interest rates, stock prices

sudden market changes. The chief risk officer of MHFG isand foreign exchange rates. Our definition includes the

responsible for matters relating to market risk manage-

risk of losses incurred when it becomes impossible to exe-ment planning and operations.

cute transactions in the market because of market confu-

The Risk Management Division of MHFG is responsible

sion or losses arising from transactions at prices that arefor monitoring market risk, reports and analyses, propos-

significantly less favorable than usual. We define liquidity

als, setting limits and guidelines, and formulating andrisk as the risk of losses arising from funding difficulties

implementing plans relating to market risk management.

due to a deterioration in our financial position that makes

The Risk Management Division assesses and manages

it difficult for us to raise the necessary funds or that forces

overall market risk of the group. It also receives reports

us to raise funds at significantly higher interest rates thanfrom our principal banking subsidiaries and other coreusual. MHFG manages market and liquidity risk for thegroup companies on their market risk management thatgroup as a whole.

enable it to obtain a solid grasp of the risk situation, submitting reports to the chief executive officer on a dailyMarket Risk Management Structurebasis and to our board of directors and the executive

 Market Risk Management of MHFG

management committee of MHFG on a regular basis.

Our board of directors determines key matters pertaining

To manage market risk, we set limits that correspondto market risk management policies. The ALM & market

to risk capital allocations according to the risk profiles ofMarket and Liquidity Risk Management Structure

MHFG

Board of Directors

our principal banking subsidiaries and other core groupcompanies and thereby prevent market risk from exceeding our ability to withstand losses based on our financial
strength represented by capital, etc. The amount of risk

Chief Executive Officer(CEO)
Head of Risk Management
Group (CRO)

Executive Management
Committee

capital allocated to market risk corresponds to VaR and

ALM & Market Risk
Management Committee

additional costs that may arise in order to close relevant
positions. For trading and banking activities, we set limits
for VaR and for losses. For banking activities, we set posi-

Risk Management Division

tion limits based on interest rate sensitivity as needed.
•Set risk management policies•Approve limits•Give instructions concerning
risk management

These limits are discussed and coordinated by the ALM•Report the risk
management situation•Apply for limits

Principal banking subsidiaries andother core group companies
MHCB

MHBK

MHTB

MHSC

Other
core groupcompanies& market risk management committee, discussed further
by the executive management committee, then determined by the chief executive officer. Various factors aretaken into account including business strategies, historicallimit usage ratios, risk-bearing capacity (profits, total capital and risk management systems), profit targets and themarket liquidity of the products involved.

Board of Directors

Chief Executive Officer (CEO)Senior executive officers
responsible for risk management

Principal banking
subsidiaries and othercore group companies
Executive Management Committee
ALM & Market Risk
Management Committee

Banking Subsidiaries and Other Core Group
Companies
Our principal banking subsidiaries and MHSC which
account for most of the group's exposure to market risk

Offices
Risk Management Division

 Market Risk Management at Our Principal

Middle Offices
Front Offices

have formulated their basic policies in line with the basic
policies determined by MHFG. Their boards of directors
determine important matters relating to market risk

58management while their chief executive officers aremanagement situation and for planning and implementing

responsible for controlling market risk. Their respective

cash flow management. Reports on the cash flow situa-business policy committees, including their ALM & market

tion are submitted to the ALM & market risk management

risk management committees, are responsible for overallcommittee, the executive management committee anddiscussion and coordination of market risk management.

the chief executive officer.

Specifically, these committees discuss and coordinate mat-

We measure liquidity risk using indices pertaining toters relating to basic asset and liability management poli-cash flow, such as limits on funds raised in the market.

cies, risk planning and market risk management andLimits on liquidity risk are discussed and coordinated bypropose responses to emergencies such as sudden market

the ALM & market risk management committee, discussedchanges. The chief risk officer of each subsidiary is respon-

further by the executive management committee andsible for matters pertaining to planning and implementing

determined by the chief executive officer. We have estab-market risk management. Based on a common group risk

lished classifications for the cash flow conditions affecting

capital allocation framework, the above-mentioned sub-the group, ranging from “normal” to “cause for concern”

sidiaries manage market risk by setting limits according toand “critical,” and have established procedures for dealing

the risk capital allocated to market risk by MHFG.

with cases which are deemed to fall into the “cause for

These companies have established specialized company-

concern” or “critical” categories. In addition, we have con-wide market risk management divisions to provide inte-

structed a system under which we will be able to respondgrated monitoring of market risk, submit reports, analyses

smoothly in the event of emergency situations that affectand proposals, set limits and formulate and implement

our funding by establishing action plans.

plans relating to market risk management. The risk man- Liquidity Risk Management at Our Principal

agement divisions of each company submit reports on the

Banking Subsidiaries and Other Core Groupstatus of market risk management to their respective chief

Companies

executive officers and top management on a daily basis,

The liquidity risk management structures of our principal

and to their board of directors and executive managementbanking subsidiaries and MHSC are generally the same ascommittee on a regular basis. They also provide regular

the aforementioned market risk management structures,

reports to MHFG. To provide a system of mutual checks

but the senior executives responsible for risk management

and balances in market operations, they have establishedare responsible for matters pertaining to planning andmiddle offices specializing in risk management that are

conducting liquidity risk management, while the seniorindependent of their front offices, which engage in market

executives of the asset and liability management and trad-

transactions, and their back offices, which are responsible

ing units are responsible for matters pertaining to plan-for book entries and settlements. When VaR is not ade-ning and conducting cash flow management.

quate to control risk, the middle offices manage risk using

The methodologies used for ensuring precise control ofadditional risk indices, carry out stress tests and set stop

liquidity risk include the formulation of management

loss limits as needed. They monitor their market liquidity

indices pertaining to cash flow, such as limits on funds

risk for individual financial products in the market whileraised in the market. As with MHFG, the above-mentioned

taking turnover and other factors into consideration.

companies have established classifications for the cash
flow affecting them, ranging from “normal” to “cause for

Liquidity Risk Management Structure

concern” and “critical,“ and have established procedures Liquidity Risk Management of MHFG

for cases which are deemed to fall into the “cause for

Our liquidity risk management structure is generally theconcern” or “critical” categories.

same as the market risk management structure described

Each subsidiary has adopted stringent controls that callabove. However, the head of the Financial Control &for the submission of reports on liquidity risk management

Accounting Group of MHFG is additionally responsible forand cash flow management to the ALM & market risk

matters relating to planning and running cash flow man-

management committee and other business policy com-agement operations, while the Financial Planning Division

mittees, the executive management committee and theis responsible for monitoring and adjusting the cash flow

chief executive officer of each subsidiary.

59

Internal Control Systems

Status of MHFG's Market Riskbanking book leads to an economic value decline of more

 Back Testing

than 20% of the sum of Tier I and Tier II capital, we will

In order to evaluate the effectiveness of market risk mea-

be deemed an ”outlier“ and may be required to reduce

surements calculated using the value-at-risk method, wethe banking book risk or adopt other responses. We mea-

carry out regular back tests to compare value-at-risk withsure losses arising from our banking book each month asassumptive profits and losses. The graph below showsa part of our stress tests.

daily value-at-risk of trading activities for the fiscal year

The table below shows the results of calculations ofended March 31, 2007, and the corresponding paired dis-losses in the banking book in cases where interest rate

tribution of profits and losses:

fluctuations occur under stress conditions. The results ofcalculations of losses in the banking book show that they

Fiscal 2006 Back Testing

are 7.1% of broadly-defined capital. Because the amount

Assumptive profit or loss (billions of yen)
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0
(1.0)
(2.0)
(3.0)
(4.0)
(5.0)
(6.0)
(7.0)

of risk on the banking book is therefore well under the
20% threshold and within controllable limits, we do not
fall under the “outlier” category.
Fiscal 2006 Results of Calculations under the
Outlier Framework
0

1.0

2.0

3.0

4.0

5.0

6.0

Amountof loss

7.0

VaR (billions of yen)
At March 31, 2005

We had no cases where profits/losses exceeded value-

At March 31, 2006
At March 31, 2007

at-risk during the period, and this confirms that our inter-

Effect of yen interest rate

nal value-at-risk models are reasonably accurate in

Effect of dollar interest rate
Effect of euro interest ratemeasuring our group's market risk exposure.

 Stress Testing
Because the value-at-risk method is based on statisticalassumptions, we conduct stress testing to simulate thelevels of losses that could be incurred in cases where themarket moves suddenly to levels that exceed these

429.6
161.3
626.1
382.5
212.2
27.9

(billions of yen)
Broadlydefined Loss ratio
capital to capital

8,020.2
8,993.2
8,841.3

5.4%
1.8%
7.1%

Notes:1. In the above results of calculations of losses, a part of demand
deposits without fixed intervals for amending applicable interest
rates are deemed core deposits and are treated accordingly inthe calculation.
2. For the interest rate shock scenario used in connection with theabove figures, we generate annual rate fluctuation data for five
years derived from daily raw historical interest rate data of thepast six years and then apply the actual fluctuation data, whichshow a rise in interest rates, at a 99.0% confidence level to theshock scenario.

assumptions. The stress testing methods we use include
the calculation of losses on the basis of the largest fluctu-

 Value-at Risk

ations occurring over a period of more than five years andWe use the value-at-risk (VaR) method, supplemented

the calculation of losses based on market fluctuations

with stress testing, as our principal tool to measure mar-occurring during historical market events. The table below

ket risk. The value-at-risk method measures the maximum

shows the assumed maximum loss results of stress testing

possible loss that could be incurred due to market move-in trading activities using the methods described above:

ments within a certain time period (or holding period) anddegree of probability (or confidence interval).

Fiscal 2006 Stress Testing
At March 31, 2007 (billions of yen)

Trading Activities
VaR related to our trading activities is based on the following:

Assumed maximum loss result calculated by stress testing

47.4• variance co-variance model for linear risk and montecarlo simulation for non-linear risk;

 Outlier Criteria• confidence interval: one-tailed 99.0%;

As part of the new capital adequacy requirements under• holding period of one day; andBasel II, the losses arising from a banking book in hypo-• historical observation period of one year.

thetical interest rate shock scenarios under certain stress60

conditions are calculated and compared with the sum of

The following tables show the VaR related to our trad-

Tier I and Tier II capital. If the interest rate risk of theing activities by risk category for the fiscal years endedMarch 31, 2005, 2006 and 2007 and as of March 31,

Non-Trading Activities

2005, 2006 and 2007:

The VaR related to our banking activities is based on thesame conditions as those of trading activities, but theVaR by Risk Category (Trading Activities)(billions of yen)

The graph below shows the VaR related to our banking

Fiscal 2004
Daily average

Maximum

1.9
1.1
0.9
0.1
2.9

3.7
2.8
1.5
0.6
4.3

Interest rate
Foreign exchange
Equities
Commodities
Total

holding period is one month.

Minimum At March 31

0.9
0.3
0.6
0.0
2.0

1.2
0.6
0.9
0.1
2.2

activities excluding our strategic equity portfolio for theyear ended March 31, 2007.
Fiscal 2006 VaR (Banking Activities)(VaR, billions of yen)

(%)

400

Maximum

1.7
1.1
1.4
0.2
3.2

2.7
1.8
3.2
1.7
5.5

Interest rate
Foreign exchange
Equities
Commodities
Total

Minimum At March 31

1.1
0.3
0.5
0.0
2.0

2.4
0.9
3.0
0.1
5.1

Fiscal 2006
Daily average

Maximum

2.3
1.2
1.8
0.2
4.3

3.9
4.0
3.5
0.4
6.5

Interest rate
Foreign exchange
Equities
Commodities
Total

Minimum At March 31

1.4
0.5
0.7
0.0
3.2

1.5
1.8
1.8
0.3
3.9

JGB Yield (5-Year)

1.6

350

1.4

300

1.2

250

1.0

200

0.8

150

0.6

100

0.4

50

0.2

0

0.0

06.04.01
06.04.15
06.04.29
06.05.13
06.05.27
06.06.10
06.06.24
06.07.08
06.07.22
06.08.05
06.08.19
06.09.02
06.09.16
06.09.30
06.10.14
06.10.28
06.11.11
06.11.25
06.12.09
06.12.23
07.01.06
07.01.20
07.02.03
07.02.17
07.03.03
07.03.17
07.03.31

Fiscal 2005
Daily average

VaR

The following table shows the VaR figures relating toour banking activities denominated in yen for the fiscal
years indicated:

The following graph shows VaR figures of our trading
activities for the fiscal year ended March 31, 2007:

VaR (Banking Activities)(billions of yen)
Maximum
Minimum

Fiscal 2006 VaR (Trading Activities)

Average(VaR, billions of yen)

Fiscal 2004

Fiscal 2005

Fiscal 2006

301.5
186.1
235.8

247.2
152.8
213.9

251.5
103.1
179.4

8.0
7.0

Characteristics of VaR Model

6.0
5.0

VaR is a commonly used market risk management

4.0

technique. However, VaR models have the following

3.0

shortcomings:

2.0• By its nature as a statistical approach, VaR estimates0

possible losses over a certain period at a particular

06.04.01
06.04.15
06.04.29
06.05.13
06.05.27
06.06.10
06.06.24
06.07.08
06.07.22
06.08.05
06.08.19
06.09.02
06.09.16
06.09.30
06.10.14
06.10.28
06.11.11
06.11.25
06.12.09
06.12.23
07.01.06
07.01.20
07.02.03
07.02.17
07.03.03
07.03.17
07.03.31

1.0

confidence level using past market movement data.
Past market movement, however, is not necessarily a

The following table shows VaR figures of our trading
activities for the fiscal years indicated:

good indicator of future events, particularly potential
future events that are extreme in nature.
• VaR may underestimate the probability of extreme

VaR (Trading Activities)
Maximum
Minimum
Average
The number of cases where
profits/losses exceeded VaR(billions of yen)
Fiscal 2004

Fiscal 2005

Fiscal 2006

4.3
2.0
2.9

5.5
2.0
3.2

6.5
3.2
4.3

no casesno casesno casesmarket movements.
• The use of a 99.0% confidence level, does not takeaccount of, nor makes any statement about, any losses that might occur beyond this confidence level.
• VaR does not capture all complex effects of various
risk factors on the value of positions and portfolios
and could underestimate potential losses.

61Internal Control Systems

 Interest Sensitivity Analysis

VaR used to calculate Market Risk Equivalent is based

We also conduct interest sensitivity analyses of interest
risk, our main source of market risk. The following tableon the following:• variance co-variance model for linear risk and monte-

shows sensitivity to yen interest risk in our banking activi-

carlo simulation for non-linear risk;ties as of the dates indicated. As shown in the table, we• confidence interval: one-tailed 99.0%;

have reduced overall sensitivity to the risk of future• holding period of 10 days; andincreases in interest rates. Interest rate sensitivity (10 BPV)

• historical observation period of one year.

shows how much net present value varies when interest
rates rise by 10 basis (0.1%), and it explains the impact ofinterest rate movements on net present value when short-

Operational Risk Management

and long-term interest rates behave differently.

Basic Approach
Interest Sensitivity by Maturity
At March 31, (billions of yen)
Up to one year
From one to five years
Over five years
Total

2005

2006

2007 Change

(5)
(34)
(5)
(44)

(7)
(14)
(6)
(27)

(6)
(21)
(20)
(48)

1
(7)
(14)
(21)

We define operational risk as the risk of loss that we may
incur resulting from inadequate or failed internal
processes, people and systems or from external events. We
recognize that operational risk includes information technology risk, operations risk, legal risk, human resources
risk, tangible asset risk, regulatory risk and reputational Market Risk Equivalentrisk. We have determined risk management policies con-

In order to calculate the amount of capital necessary tocerning risk management structures and methods for eachmeet the capital requirements relating to market risk (thekind of risk. MHCB, MHBK, MHTB, MHSC, MHIS and“market risk equivalent”), we apply internal models to cal-TCSB each manage operational risk in an appropriate

culate general market risk (risks related to factors thatmanner pursuant to risk management policies determined

apply generally to the market, e.g., interest rates, foreignby MHFG.

exchange rates) and the standardized measurement
method to calculate specific risks (risks other than generalmarket risk, e.g., credit quality and market liquidity of anindividual security or instrument). In addition, our internal
models are applied to trading transactions with market
liquidity based on the relevant holding period. Under theinternal models, the market risk equivalent is calculated byOperational Risk Management Structure

MHFG

Board of Directors
Chief Executive Officer(CEO)

Executive Management
Committee

Senior executive officers
responsible for each typeof risk managementtaking the greater of (i) VaR on the calculation date and(ii) the average VaR for the preceding 60 business days
(including the calculation date) multiplied by a multiplication factor ranging from 3.00 to 4.00 that is determinedbased on the number of times VaR is exceeded upon backOperational risk management(Risk Management Division)

IT risk management
division
Operations risk
management division

testing.

Divisions
responsible foreach type of risk
management

The following table shows total market risk equivalent
as of March 31, 2007 calculated using the standardized
measurement method and internal models:•Set risk management policies•Give instructions concerning
risk management

Fiscal 2006 Market Risk Equivalent•Report the risk
management situation

At March 31, (billions of yen)
2007
Calculated using standardized measurement method
Calculated using internal models
Total market risk equivalent

62

138.2
36.7
174.9

Principal banking subsidiaries andother core group companies
MHCB, MHBK, MHTB, MHSC, etc.

MHFG, MHCB, MHBK, MHTB and MHSC share common rules for data gathering, and we measure opera-

minimize the impact of any possible system failure or disaster on our customers.

tional risk on a regular basis, taking into account possible
future loss events and the changes in the business envi-

Information Technology Risk Management

ronment and internal management.

Information technology risk is the risk that customers may

We have established and are strengthening manage-

suffer service disruptions, or that customers or the groupment methods and systems to appropriately identify,

may incur losses arising from system defects such as fail-assess, measure, monitor and control the operationalures, faults, or incompleteness in computer operations, orrisks which arise from the growing sophistication andillegal or unauthorized use of computer systems.

diversification of financial operations and developments

In line with our basic policies regarding system risk

relating to information technology by utilizing control self-

management as well as our information security policy,

assessments and improving measurement methods.

we continue to make determined efforts to ensure the

In March 2007, operational risk was introduced understability of our information technology operations andBasel II with respect to regulatory capital requirements.

the protection and safety of informational assets relating

We selected the standardized approach for the calculation

to systems. More specifically, we are pushing ahead withof operational risk capital charge, which calculates opera-

various efforts, identifying and evaluating information

tional risk by dividing our activities into eight businesstechnology-related risk, implementing risk mitigationlines and multiplying gross income of each of those busi-

measures based on these evaluations, ensuring ongoingness lines by the applicable factor assigned to each of the

project management in such areas as process manage-

business lines.

ment in systems development and quality control andGlossary Control Self-Assessments
An autonomous method of risk management in which risk inherent in operations
is identified and, after evaluating and monitoring risks that remains despite implementing risk control, the necessary measures are implemented to reduce risk.

strengthening security to prevent information leaks.
Further, we are improving the effectiveness of ouremergency responses by improving our backup systems
and holding drills and taking other steps to minimize theimpact of any possible system failures or disasters on

Operations Risk Management

customers.

Operations risk is the risk that customers may suffer service disruptions, as well as the risk that customers or the

Reputational Risk Management

group may incur losses because senior executives or

Reputational risk is the risk of incurring tangible or intan-

employees fail to fulfill their tasks properly, cause acci-

gible losses as a result of damage to our credibility or thedents or otherwise act improperly.

credibility of the Mizuho brand when market participants

In line with our basic policies regarding operations risk

or others learn about, or the media reports on, various

management, we have established a structure for improv-

adverse events, including those that are inaccurate or

ing operations by identifying and adopting appropriate

false.

measures for mitigating operations risk. More specifically,

MHFG has established a framework under which, in

we have established clearly defined procedures for han-the event it receives reports from companies within thedling operations and periodically checking the status ofgroup concerning information that may have a serious

operational processes. We have strengthened central

impact on group management, it identifies and manages

operational guidance and oversight and are working to

the reputational risk for the group as a whole on an inte-

improve the operational expertise of staff and the risk

grated basis and responds to such reputational risk in a

management capabilities of managers. We are also imple-

manner appropriate to its scale and nature.

menting other policies, including the introduction of infor-

Each of our group companies also works to identify

mation technology, office automation and centralization

rumors swiftly and minimize possible losses by devising

to ensure efficient operations that reduce human error.

appropriate responses depending on the urgency and pos-

Further, we are improving the effectiveness of our emer-

sible impact of the situation.

gency responses by holding drills and taking other steps to(As of June 26, 2007)63

Internal Control Systems

Internal Audit Structure

MHCB and MHBK have established internal audit divisions and credit review divisions to conduct internal audits

Basic Approachat their respective domestic and overseas business offices,

Internal audits are designed as an integrated process,head office divisions and group companies. Specifically,

independent from other business operations, for evaluat-

the internal audit divisions assess the suitability and effec-

ing the extent to which internal control achieves its objec-

tiveness of business activities associated with compliancetives in key areas, including appropriate risk management,

and risk management. The credit review divisions audit

efficient and effective business operations, reliable finan-credit ratings and the status of credit management incial reporting and compliance with laws, regulations andaddition to auditing the self-assessment of assets to verify

internal rules. We conduct internal audits from an objec-

the accuracy and suitability of matters deemed necessary

tive and comprehensive standpoint, independent of oper-

to assure the soundness of assets.

ational reporting lines, and offer advice and remedial Other Core Group Companies

recommendations in connection with any problems that

MHTB, MHSC and our other core group companies havemay be identified. Through this process, internal audits

also established effective and efficient internal audit struc-assist the boards of directors of each of our group com-tures adapted to the characteristics of their respective

panies to fulfill their managerial duties efficiently andbusinesses.

effectively.
In line with the Basic Policy for Internal Audit estab-

Internal Audit Management Structure

lished by MHFG, our principal banking subsidiaries and

MHFG

other core group companies conduct internal audits,

Board of Directors

which include the auditing of their respective subsidiaries.

Chief Executive Officer (CEO)Chairman of Internal
Audit Committee

In addition, with respect to the management of risks
applicable across the group, we coordinate internal audits

Internal Audit Committee

throughout the group to assess the risk management status of the group as a whole.

Everyorganizational
unit

Internal Audit Management Structure MHFG
Our internal audit committee determines all importantmatters concerning internal audits. The committee ischaired by our president and chief executive officer and isindependent of our other business operations.

Management
by MHFG

Audit

Head of Internal
Audit Group
Division in charge:
Internal Audit Division

Advice, guidance
and remedialrecommendations

Report theresults of internal
audit, etc.

MHCB, MHBK, and othercore group companies

Our internal audit committee monitors and manages
internal audits at our principal banking subsidiaries andSubsidiaries of the above group companies

other core group companies through internal audit
reports submitted by such subsidiaries. Our internal audit
committee discusses and makes decisions regarding internal audits at our principal banking subsidiaries and othercore group companies and submits the results, together
with the results of their examination of the internal audit
reports, to our board of directors.

 MHCB and MHBKMHCB and MHBK have also established internal audit
committees that are independent of their other business
operations.

64(As of June 26, 2007)

Senior Executives

Mizuho Financial Group

Mizuho Corporate Bank

Mizuho Bank

Board of Directors

Board of Directors

Board of Directors

Terunobu Maeda*

Hiroshi Saito*

Seiji Sugiyama*

President & CEO

President & CEO

President & CEO

Masato Ono*

Norimasa Kuroda*

Takashi Nonaka*

Deputy President

Deputy President

Deputy President

Head of Internal Audit Group /Chief Auditor (CA)Takashi Tsukamoto*Tetsuji Kosaki*

Deputy President

Deputy PresidentManaging Director

Yasuhiro Sato*

Haruhisa Shiraishi*

Head of Financial Control and Accounting
Group / Chief Financial Officer (CFO)

Deputy PresidentManaging Director

Hiroshi Motoyama*

Masao Fujioka*

Managing Director

Managing Director

Head of Strategic Planning Group and Headof IT, Systems & Operations Group / Chief
Strategy Officer (CSO) / Chief Information
Officer (CIO)

Chief Risk Officer / Head of Risk Management
Group
Chief Human Resources Officer / Head of
Human Resources Group

Hiroshi Saito

Tetsuo Hiramatsu*

Director

Managing Director

Satoru Nishibori*Seiji Sugiyama
Director

Akihiko Nomiyama
Director

Mitsuo Ohashi

Head of Internal Audit Group

Chief Strategy Officer / Head of Strategic
Planning Group
Chief Financial Officer / Head of Financial
Control & Accounting Group

Mikito Nagai*
Managing Director
Head of Corporate Banking Unit

Director

Naomi Inoue*
Managing Director

Takuro Yoshida*
Managing Director

Shuzo Haimoto*Managing Director

Corporate Auditors
Hiroshi Kiyama
Corporate Auditor

Teruo Fujino
Corporate Auditor

Yukio Nozaki
Corporate Auditor

Kanemitsu Anraku

Corporate Auditors

Director

Toshiaki Hasegawa

Mitsuo Hirakata

Corporate Auditor

Corporate Auditors
Yoshiaki Sugita
Corporate Auditor

Shigeru Yamamoto
Corporate Auditor

Yukio Nozaki

Corporate Auditor

Keizo Nemoto
Yukio Nozaki

Board of Directors

Corporate Auditor

Keisuke Yokoo

Toshiaki Hasegawa

President

Corporate Auditor

Shigeyoshi Nishiyama

Corporate Auditor

Masahiro Seki

Executive Officers

Corporate Auditor

Mitsuhiro Nagahama

Masahiko Kadotani

Managing Executive Officer

Corporate Auditor

Executive Officers
Masayuki Saito

Head of the Americas

Deputy President

Kiyoto Matsuda
Deputy President

Tetsuya Fukabori
Deputy President

Akira Kawamura
Managing Executive Officer
Head of Europe, Middle East and Africa

Managing Executive Officer

Takeshi Hanai

Head of Risk Management Group, Head of Human
Resources Group and Head of Compliance Group /Chief Risk Officer (CRO) / Chief Human Resources
Officer (CHRO) / Chief Compliance Officer (CCO)Managing Executive Officer

Tsuneo Morita

Mizuho Securities

Corporate Auditor

Head of Asia & Oceania

Mizuho Trust & Banking
Board of Directors
Teruhiko Ikeda*
President and CEO

Mareto Sako*

Executive Officer

Deputy President

General Manager of Administration

Yasushi Ohkubo*

Masanori Murakami

Deputy President

Executive Officer
General Manager of Corporate Communications

Hidemi Hiroi
Executive Officer
General Manager of Group Strategic Planning

Notes:1. * Indicates Directors concurrently serving as Executive Officers.
2. Executive Officers, excluding the Directors concurrently serving as Executive Officers and Executive Officers responsible for
global regional operations and the head of the International Banking Unit of Mizuho Corporate Bank, have not been listed.
3. Executive Officers, excluding Directors concurrently serving as Executive Officers of Mizuho Bank, have not been listed.
4. Members of the Board of Directors other than the President and the Deputy Presidents, and the Corporate Auditors as wellas the Executive Officers of Mizuho Securities, have not been listed.
5. Members of the Board of Directors other than the President and CEO and the Deputy Presidents, and the Corporate
Auditors as well as the Executive Officers of Mizuho Trust & Banking, have not been listed.

(As of June 26, 2007)65

Location of Overseas Offices(As of July 31, 2007)

Network of Mizuho Corporate Bank

Asia and Oceania(Country/Region)
China

Mizuho Corporate Bank (China), Ltd.
Head Office
25th Floor, HSBC Tower, 1000 Lujiazui Ring Road,
Pudong New Area, Shanghai
200120, The People's Republic of China
TEL 86-21-6841-0001

Mizuho Corporate Bank (China), Ltd.
Beijing Branch
8th Floor, Chang-Fu-Gong Office Building, Jia 26,
Jianguomenwai Street, Chaoyang District,
Beijing 100022, The People's Republic of China
TEL 86-10-6525-1888

Mizuho Corporate Bank (China), Ltd.
Dalian Branch
6th Floor, Senmao Building, Zhongshan
Road 147, Xigang District, Dalian 116011,
The People's Republic of China
TEL 86-411-8360-2543

Mizuho Corporate Bank (China), Ltd.
Shenzhen Branch
21st Floor, Shenzhen International Financial
Building, Jian She Lu, Shenzhen, Guangdong
Province 518001, The People's Republic of China
TEL 86-755-8222-1918

Mizuho Corporate Bank (China), Ltd.
Tianjin Branch
E2ABC-5F, East Wing Binhai Finance Zone, No.20
Xinchengdong Road, TEDA, Tianjin 300457,
The People's Republic of China
TEL 86-22-6622-5588

Mizuho Corporate Bank (China), Ltd.
Wuxi Branch
8th Floor, Wuxi Software Park, No.16
Changjiang Road, WND, Wuxi,
Jiangsu Province, 214028
The People's Republic of China
TEL 86-510-8522-3939

Guangzhou Representative Office
12th Floor, Garden Tower, 368 Huanshi
Dong Lu, Guangzhou 510064,
The People's Republic of China
TEL 86-20-8385-8000

Nanjing Representative Office
Room 801, Nanjing Grand Hotel, 208 Guangzhou
Road. Nanjing, Jiangsu Province 210024,
The People's Republic of China
TEL 86-25-8332-9379

Wuhan Representative Office
Room 411, Shangri-la Hotel, 700 Jian She Dadao,
Wuhan 430015, The People's Republic of China
TEL 86-27-8578-1155

Xiamen Representative Office
Room 2102, The Bank Center, No.189 Xiahe Road,
Xiamen, Fujian 361003,
The People's Republic of China
TEL 86-592-239-5571

66

Hong Kong

TaiwanHong Kong Branch

Kaohsiung Branch

17th Floor, Two Pacific Place, 88 Queensway,
Hong Kong, S.A.R., The People's Republic of China
TEL 852-2103-3000

12th Floor, No.2, Chung Cheng 3rd Road,
Kaohsiung 800, Taiwan
TEL 886-7-236-8768

Mizuho Capital Markets (HK) Limited

Taipei Branch

16th Floor, Two Pacific Place, 88 Queensway,
Hong Kong, S.A.R., The People's Republic of China
TEL 852-2537-3815

2nd Floor, Hung Kuo Building, 167 Tun Hua
North Road, Taipei 105, Taiwan
TEL 886-2-2715-3911

India

Thailand

Mumbai Branch

Bangkok Branch

Maker Chamber III , 1st Floor, Jamnalal Bajaj Road,
Nariman Point, Mumbai, 400021 India
TEL 91-22-2288-6638

18th Floor, TISCO Tower, 48 North Sathorn Road,
Silom, Bangrak, Bangkok 10500, Thailand
TEL 66-2-638-0200

New Delhi Branch

Mizuho Corporate Leasing (Thailand)Co., Ltd.

4th Floor, East Tower, Sood Tower, 25,
Barakhamba Road, New Delhi 110 001 India
TEL 91-11-3041-0900

Indonesia

PT. Bank Mizuho Indonesia
Plaza Bll Menara 2, 24th Floor, JL., M.H. Thamrin
No.51, Jakarta 10350, Republic of Indonesia
TEL 62-21-392-5222

Korea

19th Floor, TISCO Tower 48/44 North Sathorn
Road, Silom, Bangrak, Bangkok 10500, Thailand
TEL 66-2-638-0900

VietnamHanoi Branch
Suite 403~407, 63 LTT Building,
63 Ly Thai To Street, Hanoi,
Socialist Republic of Vietnam
TEL 84-4-9363-123

Seoul Branch

Ho Chi Minh City Branch

19th Floor, Seoul Finance Center, 84 Taepyung-ro
1-ka, Chung-ku, Seoul, Republic of Korea
TEL 822-3782-8500

18th Floor, Sun Wah Tower,
115 Nguyen Hue Boulevard, District 1,
Ho Chi Minh City, Socialist Republic of Vietnam
TEL 84-8-8278-260

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 34, Menara Maxis, Kuala Lumpur City
Centre, 50088 Kuala Lumpur, Malaysia
TEL 60-3-2070-6880

Kuala Lumpur Representative Office
Level 34, Menara Maxis, Kuala Lumpur City
Centre, 50088 Kuala Lumpur, Malaysia
TEL 60-3-2070-6595

Philippines

Manila Branch
26th Floor, Citibank Tower, Valero Street corner
Villar Street, Salcedo Village, Makati City,
Metro Manila, Philippines
TEL 63-2-860-3550

Singapore

Singapore Branch
168 Robinson Road, #13-00 Capital Tower,
Singapore 068912, Republic of Singapore
TEL 65-6423-0330

Australia

Sydney Branch
Level 33, 60 Margaret Street, Sydney, N.S.W. 2000,
Australia
TEL 61-2-8273-3888

Europe and the Middle East(Country/Region)
AustriaMizuho Corporate Bank-BA
Investment Consulting GmbH
Landhausgasse 4/7, 1010 Vienna, Austria
TEL 43-1-5355868

BelgiumMizuho Corporate Bank Nederland 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 33-1-5383-4100

Germany

Düsseldorf Branch
Königsallee 60 D, 40212 Düsseldorf,
F.R. Germany
TEL 49-211-13020

Mizuho Corporate Bank (Germany)
Aktiengesellschaft
Taunustor 2, 60311 Frankfurt am Main,
F.R. Germany
TEL 49-69-27282-0

Italy

Milan Branch
6th Floor, Largo Augusto 7, 20122 Milan,
Republic of Italy
TEL 39-02-778-0001

The Netherlands

Mizuho Corporate Bank Nederland N.V.
Apollolaan 171, 1077 AS, Amsterdam,
The Netherlands
TEL 31-20-5734343

United Kingdom

London Branch
Bracken House, One Friday Street,
London EC4M 9JA, UK
TEL 44-20-7012-4000

River Plate House Representative
OfficeRiver Plate House, 7-11 Finsbury Circus,
London EC2M 7DH, UK
TEL 44-20-7012-4000

Mizuho Capital Markets (UK) LimitedRiver Plate House, 7-11 Finsbury Circus,
London EC2M 7DH, UK
TEL 44-20-7972-9900

Mizuho Investment Management(UK) Ltd.
Bracken House, One Friday Street,
London, EC4M 9JA, UK
TEL 44-20-7012-4300

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

Iran

Tehran Representative Office
3rd Floor, No.1, 14th Street,
Khaled Eslamboli Avenue, Tehran 15117, IranTEL 98-21-8872-6593

U.A.E

Dubai Branch
Room 45, 15th Floor, The Gate, Dubai, U.A.E
TEL 971-4-365-0150

RussiaMoscow Representative Office

The Americas(Country/Region)

Mizuho Corporate Bank of California
350 South Grand Avenue, Suite 1500,
Los Angeles, CA 90071, U.S.A.
TEL 1-213-612-2700

BrazilSão Paulo Representative OfficeMizuho Corporate Bank of California
Silicon Valley Branch

Avenida Paulista, 1274-11 andar, Bela Vista,São Paulo, SP, CEP. 01310-925, Brazil
TEL 55-11-3251-4199

1731 Technology Drive, San Jose,
California 95110, U.S.A.
TEL 1-408-487-1788

CanadaMizuho Corporate Bank (Canada)
100 Yonge Street, Suite 1102, Toronto, Ontario,
Canada M5C 2W1
TEL 1-416-874-0222

Mizuho Corporate Bank (Canada)
Vancouver Office
Suite 305, South Tower, 5811 Cooney Road,
Richmond, BC, Canada V6X 3M1
TEL 1-604-231-3725

Cayman Islands

Mizuho Corporate Bank (USA)1251 Avenue of the Americas,
New York, NY 10020, U.S.A.
TEL 1-212-282-3030

Mizuho Corporate Bank (USA)Atlanta Representative Office3353 Peachtree Road NE, Atlanta Financial
Center, Suite 500, Atlanta, Georgia 30326 U.S.A.
TEL 1-404-364-1550

Mizuho Corporate Bank (USA)
Chicago Representative Office

Cayman Branch

311 South Wacker Drive, Suite 2020, Chicago,
IL 60606, U.S.A.
TEL 1-312-855-1111

Coutts House, 1446 West Bay Road,
P.O. Box 707GT, Grand Cayman, Cayman Islands,
British West Indies

Mizuho Corporate Bank (USA)
Houston Representative Office

MexicoMexico Representative Office
Edificio Omega, Campos Eliseos No.345-11,
Col. Chapultepec Polanco, Deleg. MiguelHidalgo, 11560 Mexico, D.F., Mexico
TEL 52-55-5281-5037

U.S.A.

5051 Westheimer Road, Galleria Tower II,
Suite 710, Houston, Texas 77056, U.S.A.
TEL 1-713-499-4800

Mizuho Corporate Bank (USA)Los Angeles Representative Office
350 South Grand Avenue, Suite 1500,
Los Angeles, CA 90071, U.S.A.
TEL 1-213-243-4500

Chicago Branch
311 South Wacker Drive, Suite 2020,
Chicago, IL 60606, U.S.A.
TEL 1-312-855-1111

New York Branch
1251 Avenue of the Americas,
New York, NY 10020, U.S.A.
TEL 1-212-282-3000

Los Angeles Agency
350 South Grand Avenue, Suite 1500,
Los Angeles, CA 90071, U.S.A.
TEL 1-213-243-4500

Mizuho Desk(Country/Region)
Asia and Oceania

Maybank
Menara Maybank, 100 Jalan Tun Perak,
50050 Kuala Lumpur, Malaysia
TEL 60-3-2031-2346

Europe and the Middle East

Atlanta Representative Office

Raiffeisen Zentralbank Osterreich AG

3353 Peachtree Road NE, Atlanta Financial Center,
Suite 500, Atlanta, Georgia 30326, U.S.A.
TEL 1-404-364-1550

A-1030 Wein, Am Stadpark 9, Austria
TEL 43-1-71707-1375

Houston Representative Office5051 Westheimer Road, Galleria Tower II,
Suite 710, Houston, Texas 77056, U.S.A.
TEL 1-713-499-4800

Mizuho Alternative Investments, LLC
1251 Avenue of the Americas, New York, NY
10020 U.S.A.
TEL 1-212-282-3871

Mizuho Capital Markets Corporation
1440 Broadway, 25th Floor,
New York, NY 10018, U.S.A.
TEL 1-212-547-1500

Mashreqbank psc
P.O.Box 1250, Omar Bin Al Khatab Rd,
Next to Al Ghurair Centre, Deira, Dubai
TEL 971-4-207-7945
971-4-207-7267”Mizuho Desk”
By forming tie-ups with major financial institutions in regions where Mizuho does not possess
offices, we offer our customers financial services
through various institutions. (Transactions are
conducted directly between the customer and the
local financial institution.)

12 Trubnaya Street, Moscow 107045, RussianFederation
TEL 7-495-787-2771

67

Location of Overseas Offices

Network of Mizuho Securities

Network of Mizuho Trust & Banking

Beijing Representative OfficeLondon Representative Office

8th Floor, Chang-Fu-Gong Office Building, Jia 26,
Jianguomenwai Street, Chaoyang District,
Beijing 100022, The People's Republic of China
TEL 86-10-6523-4779

River Plate House, 7-11 Finsbury Circus, London
EC2M 7HB, UK
TEL 44-20-7588-7400

Shanghai Representative OfficeMizuho Trust & Banking(Luxembourg) S.A.

24th Floor, HSBC TOWER, 1000 Lujiazui
Ring Road, Pudong New Area, Shanghai
200120, The People's Republic of China
TEL 86-21-6841-1000

1B, Parc d'Activité Syrdall, L-5365 Munsbach,Grand Duchy of Luxembourg
TEL 352-4216171

Mizuho Investment Consulting(Shanghai) Co., Ltd.
Room 012, 28th Floor, HSBC Tower, 1000 Lujiazui
Ring Road, Pudong New Area, Shanghai 200120,
The People's Republic of China
TEL 86-21-6841-5558

Mizuho Securities Asia Limited
10th Floor, CITIC Tower,
1 Tim Mei Avenue, Central, Hong Kong, S.A.R.,
The People's Republic of China
TEL 852-2685-2000

Mizuho Futures (Singapore) Pte.
Limited
5 Shenton Way, #15-01 UIC Building
Singapore 068808, Republic of Singapore
TEL 65-6221-3633

Mizuho Bank (Switzerland) Ltd
Loewenstrasse 32, 8023 Zurich, Switzerland
TEL 41-44-216-9111

Mizuho International plc
Bracken House, One Friday Street,
London EC4M 9JA, UK
TEL 44-20-7236-1090

Mizuho Securities USA Inc.
1251 Avenue of the Americas, 33rd Floor,
New York, NY 10020, U.S.A.
TEL 1-212-209-9300

The Bridgeford Group, Inc.
445 Park Avenue, 20th Floor,
New York, NY 10022, U.S.A.
TEL 1-212-705-0880

68Mizuho Trust & Banking Co. (USA)666 Fifth Avenue, Suite 802,
New York, NY 10103, U.S.A.
TEL 1-212-373-5900

Network of DLIBJ Asset Management
DLIBJ Asset Management
International Ltd.
Bracken House, One Friday Street,
London, EC4M 9JA, UK
TEL 44-20-7329-3777

DLIBJ Asset Management U.S.A. Inc.
1133 Avenue of the Americas, 28th Floor,
New York, NY 10036, U.S.A.
TEL 1-212-350-7650

Financial Analysis[Under Japanese GAAP]Key Indicators of Mizuho Financial Group, Inc.

70

Financial and Economic Environment

72

Results for the Fiscal Year ended March 31, 2007

74

Status of Asset Quality8869

AR(p69-202)̲再入稿後修正080910 08.9.19 1:14 PM ページ70

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,

Total Income
Net Income (Loss)
Net Assets (Note 1)
Total Assets (Note 1) (Note 2)
Deposits
Debentures
Loans and Bills Discounted
Securities
Net Assets per Share (Yen) (Note 1)
Net Income (Loss) per Share (Yen) (Note 1)
Diluted Net Income per Share (Yen) (Note 1) (Note 2)

2007

¥

4,348.0620.9
6,724.4
149,880.0
83,608.3
4,723.8
65,964.3
36,049.9

2006¥

3,732.1
649.9
4,804.9
149,612.7
82,367.1
6,606.3
65,408.6
37,702.9

2005¥

3,455.6
627.3
3,905.7
143,076.2
80,368.0
7,795.0
62,917.3
36,047.0

2004¥

3,342.9406.9
3,644.3
137,750.0
77,487.4
9,459.5
66,205.8
32,071.6

2003¥

3,441.8(2,377.1)
2,861.0
134,032.7
72,222.6
11,696.3
69,210.0
23,816.5

336,937.64
51,474.49
48,803.07

274,906.95
55,157.14
46,234.51

131,016.15
54,625.61
37,719.13

61,980.34
36,153.27
18,754.94(20,376.71)(254,524.65)—

Capital Adequacy Ratio (BIS Standard)

12.48%

11.59%

11.91%

11.35%

9.53%

Net Return on Equity
PER (Times) (Note 2)

16.7%
14.74 x26.3%
17.45 x54.3%
9.28 x135.2%
12.39 x(183.7)%—xCash Flow from Operating Activities
Cash Flow from Investing Activities
Cash Flow from Financing Activities(3,104.9)
3,221.2(417.2)(1,669.1)(99.2)(446.6)

4,418.0(3,788.1)(557.7)

6,014.9(7,402.2)(130.9)(2,196.1)(206.3)(394.0)Cash and Cash Equivalents at the end of the fiscal year

3,089.0

3,387.9

5,602.0

5,529.6

7,048.5

Notes: 1. “Net Assets” and “Total Assets” are calculated in accordance with “Accounting Standards for Presentation of Net Assets in the Balance Sheet” (ASBJ Statement No.5, December 9, 2005) and“Guidance on Accounting Standards for Presentation of Net Assets in the Balance Sheet” (ASBJ Guidance No.8, December 9, 2005), commencing with the fiscal year ended March 31, 2007.
2. The respective amounts of “Acceptances and Guarantees” and “Customers' Liabilities for Acceptances and Guarantees” relating to the liabilities for guarantees are netted, commencing with thefiscal year ended March 31, 2007, excluding the amounts guaranteed by the Credit Guarantee Corporations which have already been netted, in accordance with the revision of the appendix
forms of “Banking Law Enforcement Regulations” (Ministry of Finance Ordinance No.10, 1982) by the “Cabinet Office Ordinance to Amend Part of Banking Law Enforcement Regulations”(Cabinet Office Ordinance No.38, April 17, 2007) effective from the fiscal year which began on or after April 1, 2006.
3. “Net Assets per Share,” “Net Income (Loss) per Share” and “Diluted Net Income per Share” are calculated in accordance with “Accounting Standard for Earnings per Share” (Financial
Accounting Standard No. 2) and “Guidance for Accounting Standards for Net Earning per Share” (ASBJ Guidance No.4, September 25, 2002). “Net Deferred Hedge Losses, net of Taxes” isincluded for calculation of net assets per share as of March 31, 2007 in accordance with the revision of the ASBJ Guidance No.4.
4. “Diluted Net Income per Share” and “PER” for the fiscal year ended March 31, 2003 are not required to be disclosed due to loss position.
5. Capital Adequacy Ratio (BIS Standard) is based on the “Standards for Bank Holding Company to Consider the Adequacy of Its Capital Based on Assets and Others Held by It and Its Subsidiaries
Pursuant to Article 52-25 of the Banking Law” (Financial Services Agency Ordinance Announcement No.20, March 27, 2006), commencing with the fiscal year ended March 31, 2007.

70

Key Indicators of Mizuho Financial Group, Inc. (Non-Consolidated)
Billions of yen

As of or for the Fiscal Years ended March 31,

Operating Income
Net Income
Common Stock and Preferred Stock
Number of Shares Issued and Outstanding
Common StockFirst Series Class I Preferred Stock
Second Series Class II Preferred Stock
Third Series Class III Preferred Stock
Fourth Series Class IV Preferred Stock
Sixth Series Class VI Preferred Stock
Seventh Series Class VII Preferred Stock
Eighth Series Class VIII Preferred Stock
Ninth Series Class IX Preferred Stock
Tenth Series Class X Preferred Stock
Eleventh Series Class XI Preferred Stock
Twelfth Series Class XI Preferred StockThirteenth Series Class XIII Preferred Stock
Net Assets (Note 1)
Total Assets (Note 1)2007¥ 1,250.0
1,239.7

2006

¥

128.9
790.2

2005

¥

26.4
30.8

2004

¥

25.7
9.9

2003

¥

0.9
0.0

1,540.9

1,540.9

1,540.9

1,540.9

1,540.9

11,872,195.49 shares
/
/
/
/
/
/
/
/
/
943,740 shares/
36,690 shares
3,176.4
4,764.0

12,003,995.49 shares///
150,000 shares
150,000 shares////
943,740 shares/
36,690 shares
2,752.3
4,793.0

12,003,995.49 shares/
100,000 shares
100,000 shares
150,000 shares
150,000 shares
125,000 shares
125,000 shares
33,000 shares
140,000 shares
943,740 shares/
36,690 shares
2,986.2
3,178.6

11,926,964.67 shares
33,000 shares
100,000 shares
100,000 shares
150,000 shares
150,000 shares
125,000 shares
125,000 shares
140,000 shares
140,000 shares
943,740 shares
5,500 shares
36,690 shares
3,533.4
3,600.0

10,582,426.71 shares
33,000 shares
100,000 shares
100,000 shares
150,000 shares
150,000 shares
125,000 shares
125,000 shares
140,000 shares
140,000 shares
943,740 shares
101,500 shares
36,690 shares
3,545.8
3,595.6

183,338.04
Net Assets per Share (Yen) (Note 2)
Dividends per Share (Yen) (Interim Dividends per Share) (Yen)Common Stock
7,000
First Series Class I Preferred Stock/
Second Series Class II Preferred Stock/
Third Series Class III Preferred Stock/
Fourth Series Class IV Preferred Stock/
Sixth Series Class VI Preferred Stock/
Seventh Series Class VII Preferred Stock/
Eighth Series Class VIII Preferred Stock/
Ninth Series Class IX Preferred Stock/
Tenth Series Class X Preferred Stock/
Eleventh Series Class XI Preferred Stock
20,000
Twelfth Series Class XI Preferred Stock/Thirteenth Series Class XIII Preferred Stock
30,000Common Stock—First Series Class I Preferred Stock/
Second Series Class II Preferred Stock/
Third Series Class III Preferred Stock/
Fourth Series Class IV Preferred Stock/
Sixth Series Class VI Preferred Stock/
Seventh Series Class VII Preferred Stock/
Eighth Series Class VIII Preferred Stock/
Ninth Series Class IX Preferred Stock/
Tenth Series Class X Preferred Stock/—
Eleventh Series Class XI Preferred Stock
Twelfth Series Class XI Preferred Stock/—Thirteenth Series Class XIII Preferred StockNet Income (Loss) per Share (Yen) (Note 2)
102,168.76
Diluted Net Income per Share (Yen) (Note 2) (Note 3)
95,550.05

94,861.81

41,782.20

46,670.33

46,568.86

4,000
/
/
/
47,60042,000—///20,000/30,000
—
/
/
/
—
—
—
/
/
/
—
/
—
63,040.65
53,235.99

3,500
/
8,200
14,00047,60042,00011,000
8,000
—
5,380
20,000—30,000
—
/
—
—
—
—
—
—
—
—
—
—
—
(588.84)—

3,000
22,5008,200
14,00047,60042,00011,0008,000
17,5005,380
20,0002,500
30,000
—
—
—
—
—
—
—
—
—
—
—
—
—
(2,846.42)——
22,5008,200
14,00047,60042,00011,0008,000
17,500
5,380
165
21
247
/
/
/
/
/
/
/
/
/
/
/
/
/
(8,663.01)—

15.27x
6.34%

—x
—%

—x
—%

—x
—%

PER (Times) (Note 3)
Dividend Propensity (Note 4)

7.42x
6.85%

Notes: 1. “Net Assets” and “Total Assets” are calculated in accordance with “Accounting Standards for Presentation of Net Assets in the Balance Sheet” (ASBJ Statement No.5, December 9, 2005) and“Guidance on Accounting Standards for Presentation of Net Assets in the Balance Sheet” (ASBJ Guidance No.8, December 9, 2005), commencing with the fiscal year ended March 31, 2007.
2. “Net Assets per Share,” “Net Income (Loss) per Share” and “Diluted Net Income per Share” are calculated in accordance with “Accounting Standard for Earnings per Share” (Financial
Accounting Standard No.2) and “Guidance for Accounting Standards for Net Earning per Share” (ASBJ Guidance No.4, September 25, 2002). “Net Deferred Hedge Losses, net of Taxes” isincluded for calculation of net assets per share as of March 31, 2007 in accordance with the revision of the ASBJ Guidance No.4.
3. “Diluted Net Income per Share” and “PER” for the fiscal year ended March 31, 2003 are not required to be disclosed due to loss position.
4. Dividend Propensity: Cash Dividends Declared per Share (Common Stock) / Net Income per Share (Common Stock). Dividend Propensity is not required to be disclosed due to non-payment ofdividends for common stock for the fiscal year ended March 31, 2003, and due to loss position of earnings per share for the fiscal year ended March 31, 2004 and 2005.

71

Financial Analysis

Financial and Economic Environment

Economic Conditions in Japan and Overseas
Looking back over the global economic climate during the fiscal year ended March 31, 2007, the overall trend in the worldwide
economy, including the U.S., Europe and Asia, was improving steadily as a whole. The Japanese economy showed sustained
growth, supported by robust exports and continuous strength in capital expenditures against a backdrop of steady improvement
in corporate performance. Consumer prices remained positive with a rise in domestic corporate goods prices due to stronger
global commodity markets. To that end, the Bank of Japan, meanwhile, decided to follow-up on its ending of zero interest rates
in July 2006 by raising the operating target of money market operations (the uncollateralized overnight call rate) by another
0.25% to around 0.5%, in February 2007.

Financial Sector
As for the Japanese financial and capital markets, stock prices held firm backed by robust corporate performance. In spite of atemporary rise in long-term interest rates early in the fiscal year in the wake of the lifting of the quantitative easing policy, rates
remained on a downward trend during the latter half of the period in response to the declining trend in U.S. interest rates, etc.
Financial institutions continue to develop individual strategies utilizing their respective strengths to the full. In response to thechanging economic environment, the group's ability to secure a competitive edge over our rivals and to consolidate profitability
even further are likely to become ever more important.

72

Trends in Interest Rates in Japan
（％）

（％）

3.0

0.75
0.70

Long-Term Prime Rate (left scale)

0.65

2.5

0.60
0.55

Newly Issued Government Bond Yield (10-Year) (left scale)

0.50

2.0

0.45
0.40
0.35

1.5

0.30

Short-Term Prime Rate (left scale)

0.25
1.0

0.20

Call Rate (Uncollateralized overnight) (right scale)

0.15
0.5

0.10

Euroyen TIBOR (3-month)(right scale)

0.05
0.00

0.0

Jan. 2006

Apr. 2006

July 2006

Oct. 2006

Jan. 2007

Apr. 2007(0.05)

Trends in TOPIX and Yen / Dollar Exchange Rate
(Point)(Yen / Dollar)
125

1,900
1,800

TOPIX (left scale)

1,700

120

1,600
1,500
1,400

115

Yen / Dollar Exchange Rate (right scale)

1,300
1,200

110

1,100
1,000
105
900
800
700

Jan. 2006

Apr. 2006

July 2006

Oct. 2006

Jan. 2007

Apr. 2007

100

73

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Consolidated Accounts of Mizuho Financial Group, Inc. (MHFG)
1. Scope of Consolidation and Application of the Equity Method
Companies

As of March 31,

2007

2006

ChangeNumber of consolidated subsidiaries
Number of affiliates under the equity method

133
19

130
19

3
—

The number of MHFG's consolidated subsidiaries increased by 3 to 133, and the number of affiliates under the equity method
was 19, no change from the end of the previous fiscal year.
The major consolidated subsidiaries are Mizuho Corporate Bank, Ltd. (MHCB), Mizuho Bank, Ltd. (MHBK), Mizuho Trust &Banking Co., Ltd. (MHTB) and Mizuho Securities Co., Ltd. (MHSC). The major affiliates under the equity method are The Chiba
Kogyo Bank, Ltd., Shinko Securities Co., Ltd. and Japan Mortgage Co., Ltd.

2. Consolidated Profits and Losses
Billions of yen

For the Fiscal Years ended March 31,

Consolidated Gross Profits
Net Interest Income
Fiduciary Income
Net Fee and Commission Income
Net Trading Income
Net Other Operating Income

2007

¥

2,117.3
1,090.2
66.9
551.1
261.5
147.5

2006

¥

2,002.4
1,062.6
78.8
555.9
204.9
100.0

Change¥General and Administrative Expenses
Expenses related to Portfolio Problems (including
Provision for (Reversal of) General Reserve for Possible Losses on Loans)

1,091.6
142.6

84.7

57.9

Net Gains (Losses) related to Stocks(109.5)231.5(341.1)

9.3

9.1

0.1
275.0

Equity in Income from Investments in Affiliates

1,095.2

114.9
27.6(11.8)
(4.8)
56.6
47.4
(3.6)

Other

191.9

(83.0)

Income before Income Taxes and Minority Interests

974.8

980.1

(5.2)

Income Taxes–Current

43.2

64.0

(20.7)

Income Taxes–Deferred

223.6

185.0

38.6

Minority Interests in Net Income

86.9

81.1

5.8

Net Income

¥

620.9

¥

649.9

¥

(28.9)Net Income per Share of Common Stock (Yen)¥ 51,474.49¥

55,157.14¥(3,682.65)

Credit-related Costs

¥

40.1

¥

(53.2)¥

93.4(Reference) Consolidated Net Business Profits

¥

991.6

¥

922.5

¥

69.0

Notes: 1. Net Gains related to Stocks for the fiscal year ended March 31, 2006 include gains on disposition of investment in a subsidiary of ¥42.4 billion.
2. Credit-related Costs = Expenses related to Portfolio Problems (including Provision for (Reversal of) General Reserve for Possible Losses on Loans) + Reversal of Reserves for Possible Losses on
Loans, etc. + Credit Costs for Trust Accounts.
3. Consolidated Net Business Profits = Consolidated Gross Profits - General and Administrative Expenses (excluding Non-Recurring Losses) + Equity in Income from Investments in Affiliates andcertain other consolidation adjustments.

74

(1) Consolidated Gross Profits
Consolidated Gross Profits for fiscal 2006 were ¥2,117.3 billion, increasing by ¥114.9 billion from the previous fiscal year.
Net Interest Income was ¥1,090.2 billion, increasing by ¥27.6 billion from the previous fiscal year, partly due to increased interest income from the Customer Groups. While Net Fee and Commission Income was ¥551.1 billion, decreasing by ¥4.8 billion
from the previous fiscal year, fee and commission income from the Customer Groups of the group banking subsidiaries and atrust banking subsidiary showed a steady increase.
Net Trading Income and Net Other Operating Income increased by ¥56.6 billion and ¥47.4 billion, respectively, from the previous fiscal year. Market-related income increased, helped by the disposition of Unrealized Losses on our bonds portfolio of ¥138.5
billion and others in the previous fiscal year. However, the group securities company subsidiaries showed a decline in equityrelated income.
(2) General and Administrative Expenses
General and Administrative Expenses for fiscal 2006 amounted to ¥1,091.6 billion, decreasing by ¥3.6 billion from the previous
fiscal year. This resulted from the outlay on “Strategic Expenses” aimed at increasing top-line profits being more than offset by
reductions in base expenses, especially IT-related expenses, as well as in Expenses related to Employee Retirement Benefits andother factors.
(3) Credit-related Costs
Credit-related Costs for fiscal 2006 amounted to ¥40.1 billion, increasing by ¥93.4 billion from the previous fiscal year, mainly
due to the worsening business performance of certain client non-bank financial companies.
(4) Net Gains (Losses) related to Stocks and Equity in Income from Investments in Affiliates
Net Gains (Losses) related to Stocks amounted to a loss of ¥109.5 billion in spite of market-related gains and gains on alternative
investments (stock-related) which were made as part of an attempt at diversification of profit sources of market-related income,and others. This was because of the losses on devaluation of stocks of certain client non-bank financial companies as a result of
their worsening business performance, and others.
Equity in Income from Investments in Affiliates amounted to ¥9.3 billion.
(5) Other
Other increased by ¥275.0 billion to record a gain of ¥191.9 billion. Major components are as follows:• Gains on cancellation on employee retirement benefit trust of ¥125.9 billion• Recovery on written-off claims of ¥77.3 billion• Reversal of reserve for contingencies of ¥28.2 billion• Gains on disposition of fixed assets of ¥16.6 billion• Losses on disposition of fixed assets of ¥17.0 billion• Losses on impairment of fixed assets of ¥4.2 billion(6) Income Taxes and Minority Interests in Net Income
Income Taxes - Current amounted to ¥43.2 billion, and Income Taxes - Deferred amounted to ¥223.6 billion.
Minority Interests in Net Income amounted to ¥86.9 billion.
(7) Net Income
After reflecting the above, Net Income amounted to ¥620.9 billion, decreasing by ¥28.9 billion from the previous fiscal year.

75

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Use and Source of Funds (Consolidated)
Billions of yen

Average balance
2007
2006

Change2007

Interest
2006

3,709.8
561.0(34.5)
2,142.4¥ 2,562.6
76.5
19.5
470.3

¥ 1,935.0
50.8
9.9
260.1

401.5
(2,393.0)
2,528.2

22.8
592.8
1,302.1

3.8
456.7
1,071.8

2,495.5
4,036.9(1,626.8)(2,297.6)
1,076.6¥ 1,472.3
584.6
34.0
31.9
609.6

(723.6)(408.1)
1,358.6

29.0
0.0
38.9

24.2
0.2
23.2

For the Fiscal Years ended March 31,

2007

Yield
2006

ChangeUse of Funds
Due from Banks
Call Loans and Bills Purchased
Receivables under Resale Agreements
Guarantee Deposits Paid under Securities
Borrowing Transactions
Securities
Loans and Bills Discounted

2.08%
3.87
3.36
5.68

1.62%
3.60
1.61
4.24

0.46%
0.27
1.74
1.44

0.29
1.67
2.00

0.05
1.20
1.71

0.24
0.46
0.28

Source of Funds
Deposits
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities
Lending Transactions
Commercial Paper
Borrowed Money

1.20%
0.70
0.60
0.46
4.97

0.72%
0.34
0.66
0.07
3.42

0.47%
0.36
(0.05)
0.39
1.54

0.47
0.14
0.98

0.35
0.06
0.90

0.11
0.07
0.08

For the Fiscal Years ended March 31,

Use of Funds
Due from Banks
Call Loans and Bills Purchased
Receivables under Resale Agreements
Guarantee Deposits Paid under Securities
Borrowing Transactions
Securities
Loans and Bills Discounted¥ 123,046.0
1,973.2
582.2
8,266.8¥ 119,336.2
1,412.1
616.8
6,124.3

7,840.3
35,463.8
64,981.2

7,438.8
37,856.8
62,453.0

Source of Funds¥ 122,208.9
Deposits
82,541.5
Debentures
5,640.1
Call Money and Bills Sold
6,848.4
Payables under Repurchase Agreements
12,251.6
Guarantee Deposits Received under Securities
Lending Transactions
6,177.1
Commercial Paper
36.6
Borrowed Money
3,939.9¥ 119,713.4
78,504.6
7,266.9
9,146.1
11,174.9
6,900.8444.7
2,581.2

¥

¥

¥

872.3
273.0
48.2
6.4
383.1

Change

¥

627.5
25.6
9.6
210.2
19.0
136.1
230.2

¥

599.9
311.5
(14.1)
25.5
226.4
4.8
(0.2)
15.7
%

Net Fee and Commission Income (Consolidated)
Billions of yen

For the Fiscal Years ended March 31,

2007

2006

¥ 551.1¥ 555.9¥(4.8)

Fee and Commission Income
Deposits, Debentures and Lending Business
Securities-related Business
Remittance Business
Trust-related BusinessAgency Business
Guarantee Business
Safe Custody and Safety Deposit Box Business¥ 658.8
155.5
101.4
116.0
63.2
54.9
30.2
6.2

¥ 650.5
143.4
135.2
116.1
55.2
49.6
28.1
6.5

¥

8.3
12.0
(33.8)
(0.1)
8.0
5.3
2.0
(0.3)

Fee and Commission Expenses
Remittance Business¥ 107.7
33.7¥¥ 13.1
3.1

Net Fee and Commission Income

76

94.6
30.5

Change3. Consolidated Assets, Liabilities and Net Assets
Billions of yen

As of March 31,

2007

2006

Total Assets
Cash and Due from Banks
Trading Assets
Securities
Loans and Bills Discounted¥ 149,880.0
3,993.3
10,414.5
36,049.9
65,964.3¥ 149,612.7
5,016.2
10,007.1
37,702.9
65,408.6

Total Liabilities
Deposits
Debentures
Call Money and Bills Sold

143,155.6
83,608.3
4,723.8
6,924.1

143,448.6
82,367.1
6,606.3
9,466.0(293.0)1,241.1(1,882.4)(2,541.9)////¥ 6,724.4
3,360.0
1,551.2
1,813.1

Net Assets
Shareholders' Equity
Valuation and Translation Adjustments
Minority Interests¥

Minority Interests
Total Shareholders' Equity
Net Unrealized Gains on Other Securities, net of Taxes

6,724.4
3,360.0
1,551.2
1,813.1

¥

/
¥

/
/

¥

Change¥267.2(1,022.8)
407.4(1,652.9)555.6

1,359.1(1,359.1)

4,804.9
1,279.2¥ (4,804.9)(1,279.2)

Note: Former “Shareholders' Equity” is presented as “Net Assets” and classified into “Shareholders' Equity,” “Valuation and Translation Adjustments” and “Minority Interests.”(1) Assets and Liabilities
Consolidated Total Assets as of March 31, 2007 amounted to ¥149,880.0 billion, increasing by ¥267.2 billion from the end of theprevious fiscal year.
Securities were ¥36,049.9 billion, decreasing by ¥1,652.9 billion from the end of the previous fiscal year. This reflected mainly adecrease in Japanese government bonds.
The balance of Loans and Bills Discounted amounted to ¥65,964.3 billion, increasing by ¥555.6 billion from the end of the previous fiscal year.
Consolidated balance of Disclosed Claims under the Financial Reconstruction Law amounted to ¥1,263.9 billion, increasing by¥176.3 billion from the end of the previous fiscal year.
Net Deferred Tax Assets (the amount after netting out Deferred Tax Assets and Deferred Tax Liabilities) were ¥170.8 billion,
decreasing by ¥124.9 billion from the end of the previous fiscal year as a result of recording taxable income and others, with thecontinued conservative assessment of asset recoverability.
Deposits (excluding Negotiable Certificates of Deposit (“NCDs”)) amounted to ¥74,803.0 billion, increasing by ¥1,795.0 billion
from the end of the previous fiscal year, mainly due to increases in deposits at overseas branches and others.
(2) Consolidated Capital Adequacy Ratio (BIS Standard)
From the end of this fiscal year, the Consolidated Capital Adequacy Ratio (BIS Standard) is calculated according to regulations
promulgated pursuant to “Basel II.”
Risk-based Capital amounted to ¥8,841.3 billion. This is due to the fact that while a Net Income amount was recognized, werepurchased and cancelled public funds of preferred shares amounting to ¥603.5 billion (¥600.0 billion on an issued-price basis)and there were other factors.
Risk-weighted Assets amounted to ¥70,795.4 billion due to the increase in assets and further efforts to expand profits after
entering into the new phase in our management strategy.
As a result, the Consolidated Capital Adequacy Ratio (Basel II BIS Standard) was 12.48%.

77

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Fair Value of Other Securities (Consolidated)
Billions of yen

As of March 31, 2007

Acquisition cost

Fair value

Other Securities*1
Japanese Stocks
Japanese Bonds
Other¥ 28,289.6
3,317.0
15,554.6
9,417.9¥ 30,730.7
6,010.8
15,397.1
9,322.7

Gross unrealized
Gains

¥

2,803.3
2,741.8
3.9
57.5

¥

LossesNet unrealized*2
gains (losses)

362.2
48.0
161.4
152.7

¥ 2,441.1
2,693.7(157.4)(95.2)
Billions of yen

As of March 31, 2006

Acquisition cost

Fair value

Other Securities*1
Japanese Stocks
Japanese Bonds
Other¥ 30,285.2
2,991.1
20,369.9
6,924.1¥ 32,435.0
5,453.5
20,109.3
6,872.0

LossesNet unrealized*2
gains (losses)

426.2
30.3
261.7
134.0

¥ 2,149.7
2,462.3(260.6)(52.0)

Gross unrealized
Gains

LossesNet unrealized
gains (losses)

227.3
249.0
2.7
(24.5)(64.0)
17.6(100.3)18.6

Gross unrealized
Gains

¥

2,575.9
2,492.7
1.1
82.0

¥

Billions of yen

ChangeOther Securities
Japanese Stocks
Japanese Bonds
Other

Acquisition cost

Fair value¥ (1,995.6)
325.8(4,815.3)
2,493.8¥ (1,704.2)
557.2(4,712.1)
2,450.6

¥

¥

¥

291.3
231.4
103.1
(43.1)*1 In addition to the balances shown in the above table, Other Securities include securities which do not have readily determinable fair values such as follows:
As of March 31, 2007
Beneficial certificate of loan trust and other¥2,161.3 billion
Non-publicly offered bonds¥2,231.5 billion
Unlisted foreign securities¥1,264.8 billion
Other¥ 475.2 billion
As of March 31, 2006
Unlisted stock¥ 807.8 billion
Non-publicly offered bonds¥2,018.7 billion*2 Net unrealized gains (losses) include ¥3.9 billion and ¥(51.6) billion, which were recognized in the statements of income for the fiscal years ended March 31, 2007 and 2006, respectively, by applying
the fair-value hedge method. As a result, the base amount to be recorded directly to Net Assets (Shareholders' Equity as of March 31, 2006) after tax and consolidation adjustments as of March 31,
2007 and 2006 were ¥2,437.1 billion and ¥2,201.4 billion, respectively.

(Reference)
Unrealized Gains (Losses) on Other Securities (the base amount to be recorded directly to Net Assets after tax and consolidation adjustments)
For certain Other Securities (which have readily determinable fair values), unrealized gains (losses) were recognized in the statement of income by applying the fair-value hedge method. They were excluded from unrealized gains (losses) on Other Securities.
These adjusted unrealized gains (losses) were the base amount, which was to be recorded directly to Net Assets (Shareholders'Equity as of March 31, 2006) after tax and consolidation adjustments.
The base amount was as follows:
Billions of yen

As of March 31,

Other Securities
Japanese Stocks
Japanese Bonds
Other

78

2007

¥

2,437.1
2,693.7(164.1)(92.4)

2006¥

2,201.4
2,462.3(234.4)(26.4)

Change

¥

235.7
231.4
70.3
(65.9)

Consolidated Capital Adequacy Ratio (BIS Standard)%, Billions of yen

As of March 31,

2007

2006

Consolidated Capital Adequacy Ratio
Tier 1 Capital Ratio

12.48%
6.96%

11.59%
5.87%

Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

4,933.5
4,092.6
184.7

Total Risk-based Capital¥

8,841.3

Risk-weighted Assets¥ 70,795.4¥

4,555.9
4,554.0
116.7¥

8,993.2¥ 77,534.5

Note: Consolidated Capital Adequacy Ratio (BIS Standard) as of March 31, 2007 is calculated according to regulations promulgated pursuant to “Basel II.”

79

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Aggregated Figures of the Three Banks
For an early achievement of corporate revitalization, loans and stocks of customers in need of revitalization/restructuring held by
MHCB, MHBK and MHTB (the Three Banks) were transferred to their financial subsidiaries for corporate revitalization in July 2003.
MHCB, MHBK and MHTB merged with their own financial subsidiaries for corporate revitalization respectively, as of October 1,
2005, in consequence of the termination of the “Corporate Revitalization Project.”
Aggregated figures of the Three Banks are as follows:

Profits and Losses

Aggregatedfigures of theThree Banks

As of orfor the Fiscal Years ended
March 31, 2004 and 2005

As of orfor the Fiscal Year ended
March 31, 2006

MHCB
+ Mizuho Corporate, Ltd.
+ Mizuho Global, Ltd.

MHCB
+ Mizuho Corporate, Ltd.
+ Mizuho Global, Ltd.

MHBK
+ Mizuho Project, Ltd.

MHBK
+ Mizuho Project, Ltd.

MHTB
+ Mizuho Asset, Ltd.

MHTB
+ Mizuho Asset, Ltd.

MHCB
+ Mizuho Corporate, Ltd.
+ Mizuho Global, Ltd.
Assets, Liabilities
and Net Assets

MHCB
MHBK
MHTB

MHBK
+ Mizuho Project, Ltd.

As of orfor the Fiscal Years ended
March 31, 2003 and 2007

MHCB
MHBK
MHTB

MHCB
MHBK
MHTB

MHTB
+ Mizuho Asset, Ltd.

1. Differences between Consolidated Figures and Aggregated Figures of the Three Banks
Billions of yen, %For the Fiscal Years ended March 31,

Gross Profits
Net Interest Income
Fiduciary Income
Net Fee and Commission Income
Net Trading Income
Net Other Operating Income

MHFG(Consolidated)(a)¥2,117.3 ¥1,090.2
66.9
551.1
261.5
147.5
40.1

23.3

¥

620.9 ¥

598.2

Credit-related Costs
Net Income

2007
AggregatedFigures of theThree Banks (b)1,700.2
952.5
66.1
400.8
129.4
151.3

(a) – (b) (b) / (a)¥ 417.1
80.3%
137.7
87.3
0.8
98.7
150.2
72.7
132.1
49.4
(3.8) 102.5
¥

16.8

57.9

22.7

96.3%

MHFG
(Consolidated)(a)¥2,002.4
1,062.6
78.8
555.9
204.9
100.0

¥

649.9

2006
AggregatedFigures of theThree Banks (b)(a) – (b) (b) / (a)¥ 1,698.8
1,112.0
77.9
378.4
33.4
96.9

¥ 303.5 84.8%(49.4) 104.6
0.8 98.8
177.5 68.0
171.4 16.3
3.0 96.9(53.2)¥(63.9)

10.7 120.1

732.9¥ (83.0) 112.7%

Note: Credit-related Costs = Expenses related to Portfolio Problems + Provision for General Reserve for Possible Losses on Loans + Reversal of Reserves for Possible Losses on Loans, etc. + Credit Costs for
Trust Accounts.

Billions of yen, %

80

2007
AggregatedFigures of theThree Banks (b)As of March 31,

MHFG(Consolidated)(a)Total Assets
Securities
Loans and Bills Discounted¥ 149,880.0 ¥ 139,572.6 ¥10,307.3
93.1%
36,049.936,403.4(353.4) 100.9
65,964.3
66,826.1(861.8) 101.3(a) – (b) (b) / (a)MHFG(Consolidated)
(a)

2006
AggregatedFigures of theThree Banks (b)¥ 149,612.7
37,702.9
65,408.6¥138,454.1 ¥11,158.6 92.5%
38,148.8(445.8) 101.1
65,984.7(576.0) 100.8(a) – (b) (b) / (a)2. Aggregated Profits and Losses(the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Domestic Gross Profits
International Gross Profits

2007

¥

1,231.2
469.0

2006

¥

1,358.0
340.7

Change¥(126.8)128.2

Gross Profits
Net Interest Income
Fiduciary Income
Net Fee and Commission Income
Net Trading Income
Net Other Operating Income
Net Gains (Losses) related to Bonds

1,700.2
952.5
66.1
400.8
129.4
151.3
25.5

1,698.8
1,112.0
77.9
378.4
33.4
96.9
(104.1)

1.4(159.5)(11.8)
22.4
95.9
54.3
129.7

General and Administrative Expenses (excluding Non-Recurring Losses)
Expense Ratio

855.7
50.3%

810.9
47.6%

44.7
2.6%

Net Business Profits (before Provision for (Reversal of) General Reserve
for Possible Losses on Loans)Excluding Net Gains (Losses) related to Bonds

844.5
819.0

889.2
993.4

(44.7)(174.4)

Provision for (Reversal of) General Reserve for Possible Losses on Loans

17.3

(0.2)

17.5

Net Business Profits

827.2

888.1

(60.8)Net Non-Recurring Gains (Losses)
Net Gains (Losses) related to Stocks
Expenses related to Portfolio Problems
Other(18.8)(115.3)(111.1)
207.6

47.4
199.7
(115.4)(36.8)(66.3)(315.1)
4.2
244.4

Income before Income Taxes

808.3

935.6

(127.2)

0.5

0.6

(0.0)

Income Taxes–Current
Income Taxes–Deferred

209.5

202.0

7.5

Net Income

¥

598.2

¥

732.9

¥

(134.7)

Credit-related Costs

¥

23.3

¥

(63.9)¥

87.2

Notes: 1. Dividends from the financial subsidiaries for corporate revitalization of ¥120.0 billion were included for the fiscal year ended March 31, 2006 due to the simple aggregation of the three banks(non-consolidated) and their financial subsidiaries for corporate revitalization.
2. Net Business Profits (before Provision for (Reversal of) General Reserve for Possible Losses on Loans) of MHTB exclude the amounts of Credit Costs for Trust Accounts.
3. Credit-related Costs = Expenses related to Portfolio Problems + Provision for (Reversal of) General Reserve for Possible Losses on Loans + Reversal of Reserves for Possible Losses on Loans, etc. +Credit Costs for Trust Accounts.

Breakdown of Gross Profits (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Net Interest Income
Domestic Operations
International Operations

2007

¥

952.5
858.7
93.8

2006

¥

1,112.0
957.1
154.8

Change¥(159.5)(98.4)(61.0)

Fiduciary Income
Domestic Operations
International Operations

66.1
66.1
/

77.9
77.9
/

(11.8)(11.8)/Net Fee and Commission Income
Domestic Operations
International Operations

400.8
319.5
81.3

378.4
308.8
69.5

22.4
10.6
11.7

Net Trading Income
Domestic Operations
International Operations

129.4
1.3
128.0

33.4
70.8
(37.3)

95.9(69.4)
165.4

Net Other Operating Income
Domestic Operations
International Operations

151.3(14.5)
165.8

96.9(56.7)
153.7

54.3
42.2
12.1

Gross Profits¥

1,700.2¥

1,698.8

¥

1.4

81

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Breakdown of Net Interest Income (MHCB and MHBK excluding Financial Subsidiaries for Corporate Revitalization)
Billions of yen, %Change

2007

Yield
2006

3,194.4
3,706.3(3,753.6)

1.82%
1.90
1.63

1.60%
1.61
1.54

0.22)%
0.29
0.08

110,678.4
85,596.8

487.8
616.7

1.01
0.71

0.61
0.38

0.40
0.33

/

/

/

0.81

0.99

(0.17)

/

/

/

1.18

1.23

(0.04)

Domestic Operations
Use of Funds
Loans and Bills Discounted
Securities

87,586.5
53,160.9
25,676.3

88,004.3
51,663.5
30,109.8(417.7)
1,497.3(4,433.5)

1.15
1.39
0.88

1.12
1.29
0.94

0.02
0.09
(0.06)

Source of Funds
Deposits and Debentures

88,364.3
72,716.3

91,611.2
74,694.4(3,246.9)(1,978.0)

0.23
0.16

0.10
0.08

0.12
0.07

Interest Margins

/

/

/

0.92

1.02

(0.09)

Loan and Deposit Margin

/

/

/

1.22

1.20

0.01

International Operations
Use of Funds
Loans and Bills Discounted
Securities

23,648.4
8,966.4
8,609.3

20,771.1
6,757.3
7,929.4

2,877.2
2,209.0
679.9

4.31
4.97
3.85

3.57
4.09
3.79

0.74
0.87
0.05

Source of Funds
Deposits and Debentures

23,011.9
13,497.1

20,012.0
10,902.4

2,999.9
2,594.7

4.03
3.71

2.93
2.43

1.10
1.28

Interest Margins

/

/

/

0.28

0.63

(0.35)

Loan and Deposit Margin

/

/

/

1.25

1.66

(0.40)For the Fiscal Years ended March 31,

2007

Average balance
2006

Total
Use of Funds
Loans and Bills Discounted
Securities¥ 111,025.1
62,127.3
34,285.6¥ 107,830.7
58,420.9
38,039.3

Source of Funds
Deposits and Debentures

111,166.3
86,213.5

Interest Margins
Loan and Deposit Margin¥

ChangeBreakdown of Net Fee and Commission Income (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Net Fee and Commission Income

82

2007

2006

Change¥ 400.8¥ 378.4¥ 22.4

Fee and Commission Income
Deposits, Debentures and Lending Business
Remittance Business
Securities-related BusinessAgency Business
Guarantee Business
Safe Custody and Safety Deposit Box Business¥ 500.8
155.3
116.2
54.3
28.0
29.7
6.2

¥ 480.0
138.8
116.3
61.5
29.3
25.8
6.5

¥ 20.8
16.4
(0.0)
(7.2)
(1.3)
3.8
(0.3)

Fee and Commission Expenses
Remittance Business¥ 100.0
33.4¥ 101.6
30.5¥ (1.6)
2.8

Breakdown of Net Other Operating Income (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

2007

Net Other Operating Income¥ 151.3

¥

96.9

¥

54.3

¥ 151.3
139.1
25.5

¥

96.9
219.4
(104.1)¥

54.3(80.2)
129.7

Total
Profits on Foreign Exchange Transactions
Net Gains (Losses) related to Bonds

2006

ChangeDomestic Operations
Net Losses related to Bonds(14.5)(6.7)(56.7)(57.7)

42.2
51.0International Operations
Profits on Foreign Exchange Transactions
Net Gains (Losses) related to Bonds

165.8
139.1
32.2

153.7
219.4
(46.3)

12.1(80.2)
78.6

Breakdown of General and Administrative Expenses (excluding Non-Recurring Losses) (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Personnel Expenses

2007

2006

¥ 244.9¥ 243.7

561.4

518.9

Non-personnel Expenses
Miscellaneous Taxes

Change

¥

1.1
42.5

49.3

48.2

¥ 855.7¥ 810.9

2007

2006

Change¥ (115.3)
217.3
(2.3)
(330.6)(0.0)
0.3¥ 199.7
238.2(6.3)(28.5)—(3.6)¥ (315.1)(20.9)
3.9(302.1)(0.0)
4.0

Expenses related to Portfolio Problems(111.1)(115.4)

4.2

Other

207.6

(36.8)

244.4

Total

1.0
¥

44.7

Breakdown of Net Non-Recurring Gains (Losses) (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Net Gains (Losses) related to Stocks
Gains on Sales
Losses on Sales
Losses on Devaluation
Provision for Reserve for Possible Losses on Investments
Gains (Losses) on Derivatives other than for Trading

Net Non-Recurring Gains (Losses)¥(18.8)¥

47.4¥(66.3)(Reference) Breakdown of Credit-Related Costs (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Credit-related Costs
Credit Costs for Trust Accounts
Reversal of General Reserve for Possible Losses on Loans
Losses on Write-offs of Loans
Provision for (Reversal of) Specific Reserve for Possible Losses on Loans
Reversal of Reserve for Possible Losses on Loans to Restructuring Countries
Provision for (Reversal of) Reserve for Contingencies
Other (including Losses on Sales of Loans)

2007

¥

23.3
—
(121.8)
(8.5)
184.3
(0.3)
(28.2)
(1.9)

2006

¥

(63.9)
1.4(10.7)
36.9(135.3)
(2.4)
35.4
10.7

Change

¥

87.2
(1.4)
(111.1)(45.5)
319.7
2.0(63.7)(12.6)

83

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

3. Aggregated Assets, Liabilities and Net Assets
Assets and Liabilities (the Three Banks) (Banking Accounts)
Billions of yen

As of March 31,

Total Assets
Cash and Due from Banks
Call Loans
Securities
Loans and Bills Discounted
Total Liabilities
Deposits
Debentures
Call Money
Bills Sold
Net Assets
Shareholders' Equity
Valuation and Translation Adjustments
Total Shareholders' Equity
Net Unrealized Gains on Other Securities, net of Taxes

2007

2006

Change¥ 139,572.6
5,093.6
4,690.5
36,403.4
66,826.1¥ 138,454.1
6,085.4
2,641.5
38,148.8
65,984.7¥ 1,118.5(991.8)2,049.0(1,745.4)
841.4

133,482.9
84,408.5
4,767.3
10,918.2—

132,815.9
84,253.0
6,674.1
7,676.8
3,246.9

667.0
155.5
(1,906.7)
3,241.3(3,246.9)

6,089.7
4,533.4
1,556.2///

6,089.7
4,533.4
1,556.2//

5,638.2
1,252.4(5,638.2)(1,252.4)

Notes: 1. Former “Shareholders' Equity” is presented as “Net Assets” and classified into “Shareholders' Equity” and “Valuation and Translation Adjustments.”
2. Loans to MHFG are included as follows:
As of March 31, 2007: ¥1,380.0 billion (from MHCB ¥690.0 billion; from MHBK ¥690.0 billion)
As of March 31, 2006: ¥965.0 billion (from MHCB ¥342.0 billion; from MHBK ¥623.0 billion)

Balance of Housing and Consumer Loans (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

As of March 31,

Housing and Consumer Loans
Housing Loans for Owner's Residential Housing

2007

2006

¥ 12,115.5
9,684.3¥ 11,774.1
9,225.6

Change

¥

341.3
458.6

Loans to Small and Medium-Sized Enterprises (SMEs) and Individual Customers (the Three Banks)(Banking Accounts and Trust Accounts)
Billions of yen, %As of March 31,

Loans to SMEs and Individual Customers
Percentage of Loans to SMEs
and Individual Customers, of Total Domestic Loans

2007

2006

Change¥ 37,850.1¥ 39,531.7¥ (1,681.5)

62.0%

65.1%

(3.0%)

Notes: 1. Loans to MHFG are included as follows:
As of March 31, 2007: ¥1,380.0 billion (from MHCB ¥690.0 billion; from MHBK ¥690.0 billion)
As of March 31, 2006: ¥965.0 billion (from MHCB ¥342.0 billion; from MHBK ¥623.0 billion)
2. Above figures do not include loans booked at overseas offices and offshore loans.
3. The definition of SMEs is as follows:Enterprises of which the capital is ¥300 million or below (¥100 million or below for the wholesale industry, and ¥50 million or below for the retail and service industries), or enterprises withfull-time employees of 300 or below (100 or below for the wholesale industry, 50 or below for the retail industry, and 100 or below for the service industry.)84

Fair Value of Other Securities (the Three Banks) (Banking Accounts)
Billions of yen

As of March 31, 2007

Acquisition cost

Fair value

Other Securities*1
Japanese Stocks
Japanese Bonds
Other¥ 27,767.8
3,355.4
15,343.7
9,068.7¥ 30,124.7
5,965.2
15,186.4
8,972.9

Gross unrealized
Gains

¥

2,717.1
2,656.6
3.9
56.5

¥

LossesNet unrealized*2
gains (losses)

360.2
46.8
161.2
152.2

¥ 2,356.8
2,609.8(157.2)(95.7)
Billions of yen

As of March 31, 2006

Acquisition cost

Fair value

Other Securities*1
Japanese Stocks
Japanese Bonds
Other¥ 29,824.5
3,017.2
20,216.0
6,591.2¥ 31,882.6
5,383.6
19,956.0
6,542.9

LossesNet unrealized*2
gains (losses)

426.6
32.3
261.1
133.2

¥ 2,058.1
2,366.4(259.9)(48.3)

Gross unrealized
Gains

LossesNet unrealized
gains (losses)

232.3
257.8
2.7
(28.3)(66.4)
14.5(99.9)
19.0

Gross unrealized
Gains

¥

2,484.8
2,398.7
1.1
84.8

¥

Billions of yen

ChangeOther Securities
Japanese Stocks
Japanese Bonds
Other

Acquisition cost

Fair value¥ (2,056.6)
338.2(4,872.3)
2,477.4¥ (1,757.9)
581.6(4,769.5)
2,430.0

¥

¥

¥

298.7
243.3
102.7
(47.3)*1 In addition to the balances shown in the above table, Other Securities includes securities which do not have readily determinable fair values.
*2 Net unrealized gains (losses) include ¥3.9 billion and ¥(51.6) billion, which were recognized in the statements of income for the fiscal years ended March 31, 2007 and 2006, respectively, by applying
the fair-value hedge method. As a result, the base amount to be recorded directly to Net Assets (Shareholders' Equity as of March 31, 2006) after tax adjustments as of March 31, 2007 and 2006 were¥2,352.9 billion and ¥2,109.8 billion, respectively.

(Reference)
Unrealized Gains (Losses) on Other Securities (the base amount to be recorded directly to Net Assets after tax adjustments)
For certain Other Securities (which have readily determinable fair values), unrealized gains (losses) were recognized in the statement of income by applying the fair-value hedge method. They were excluded from unrealized gains (losses) on Other Securities.
These adjusted unrealized gains (losses) were the base amount, which was to be recorded directly to Net Assets (Shareholders'Equity as of March 31, 2006) after tax adjustments.
The base amount was as follows:
Billions of yen

As of March 31,

Other Securities
Japanese Stocks
Japanese Bonds
Other

2007

¥

2,352.9
2,609.8(163.9)(92.9)

2006¥

2,109.8
2,366.4(233.8)(22.7)

Change

¥

243.1
243.3
69.8
(70.1)

85

Financial Analysis

Results for the Fiscal Year ended March 31, 2007

Segment Information by Global Group
Total of the Global Corporate Group
MHCB
Domestic International
For the Fiscal Year ended March 31, 2007

Gross Profits
Net Interest Income
Net Non-interest Income¥

General and Administrative Expenses

¥

377.0

OthersNet Business Profits

785.3
407.7
377.6

364.0

¥

241.0

(44.3)
¥

547.9
306.5
241.4

306.9

¥

88.3

0.0
¥

310.6
202.4
108.2

222.3

¥

61.5

0.0
¥

133.0
73.4
59.6

71.5

Others

104.3
30.7
73.6

¥

105.7 ¥
(0.2)
105.9

131.7
101.4
30.3

61.1

74.9

91.2

0.0
¥

MHSC
Tradingand others

0.0
¥

13.1

0.0
¥

44.6

(44.3)¥

12.5

Note: Credit-related costs for Trust Accounts are excluded from Gross Profits.

Total of the Global Corporate Group
MHCB
Domestic International
For the Fiscal Year ended March 31, 2006

Gross Profits
Net Interest Income
Net Non-interest Income

¥

737.5
402.6
334.9

¥

531.0
376.6
154.4

¥

318.7
211.2
107.5

¥

112.0
56.6
55.4

MHSC

OthersTradingand others¥

100.3 ¥
108.8
(8.5)

118.7
1.0
117.7

¥

87.8
25.0
62.8

General and Administrative Expenses

334.1

215.8

82.0

51.7

82.1

55.2

63.1

Others(36.9)

0.0

0.0

0.0

0.0

0.0

(36.9)

63.5 ¥(12.2)Net Business Profits

¥

366.5

¥

315.2

¥

236.7

¥

60.3

¥

18.2

¥

Notes: 1. Credit-related costs for Trust Accounts are excluded from Gross Profits.
2. Figures for MHCB, MHBK and MHTB for the fiscal year ended March 31, 2006 include those for their respective financial subsidiaries for corporate revitalization.
3. Dividends of ¥120.0 billion received by MHCB from its subsidiaries for corporate revitalization are excluded from Net Interest Income of “Trading and others” in MHCB.

Notes: 1. Data on this page are calculated in accordance with the standards for disclosures described in FAS131 (Disclosuresabout Segments of an Enterprise and Related Information), same as the business segment information contained in
the registration statement on Form 20-F, which was filed with the U.S. Securities and Exchange Commission.
2. “Others” in each of the Global Groups includes elimination of transactions between companies within the respective
Global Groups. “Others” in MHFG includes elimination of transactions between the Global Groups.
3. Data on this page are based on the internal management figures and are the aggregates of the described segments inaccordance with the fiscal 2006 management accounting rules. As fractions on this page have been rounded to thenearest whole, some of the figures on this page are different from those on the other charts and so on.

86Billions of yen

Total of the Global Retail Group
MHBK

MHIS
Retailbanking¥ 1,105.4
640.6
464.8

¥

588.5
505.4

¥

527.0

(11.5)
¥

978.5
593.8
384.7

451.5

Tradingand others

¥

¥

199.3

0.0
¥

316.0
262.6
53.4

Corporatebanking

245.2

0.0
¥

116.7

559.9
326.6
233.3

314.7

¥

82.5

0.0
¥

102.6
4.6
98.0

20.1

¥

43.4

0.0
¥

62.2
1.2
61.0

Others18.8

Total of the Global Asset & Wealth Management GroupMHTB
OthersOthers¥49.7 ¥
1.6
48.1

3.1 ¥ 2,117.4(11.8)
1,090.3
14.9
1,027.1

38.4(15.8)

18.1

0.0
¥

64.7
45.6
19.1

35.1

223.6
53.8
169.8

¥

126.2

(11.5)¥

Consolidated
Figures of
MHFG

96.2

¥

87.8

(1.2)
¥

173.9
52.2
121.7
0.0

¥

86.1

¥

1,075.9

(1.2)

7.1

(49.9)

10.1 ¥

26.0 ¥

991.6

Billions of yen

Total of the Global Retail Group
MHBK

MHIS
Retailbanking¥ 1,037.1
619.9
417.2

¥

¥

883.0
569.7
313.3

¥

286.0
240.2
45.8

Corporatebanking

Tradingand others

¥

¥

552.2
319.0
233.2

44.8
10.5
34.3

¥

73.1
0.6
72.5

Others

¥

81.0
49.6
31.4

Total of the Global Asset & Wealth Management GroupMHTB
Others

¥

208.7
46.1
162.6

¥

166.3
45.7
120.6

¥

OthersConsolidated
Figures of
MHFG

42.4 ¥
0.4
42.0

20.5 ¥ 2,003.8(6.0)
1,062.6
26.5
941.2

583.0

517.3

201.4

253.7

62.2

40.0

25.7

110.4

77.9

32.5

13.8

(7.8)

0.0

0.0

0.0

0.0

0.0

(7.8)

(1.2)

0.0

(1.2)

5.9

(40.0)

298.5 ¥

(17.4) ¥

33.1

8.7 ¥

12.6 ¥

922.5

446.3

¥

365.7

¥

84.6

¥

¥

47.5

¥

97.1

¥

88.4

¥

1,041.3

87

Financial Analysis

Status of Asset Quality

Loans and stocks of customers in need of revitalization/restructuring held by MHCB, MHBK and MHTB (the Three Banks) were transferred to their financial subsidiaries for corporate revitalization in July 2003.
MHCB, MHBK and MHTB merged with their own financial subsidiaries for corporate revitalization respectively, as of October 1,
2005, in consequence of the termination of the Corporate Revitalization Project.
Please refer to the definition of aggregated figures of the Three Banks on page 80.
Trust account denotes trust accounts with contracts indemnifying the principal amounts.

 Disposal of Non-performing Loans (NPLs) in the Fiscal Year ended March 31, 2007
Consolidated Credit-related Costs resulted in ¥40.1 billion and Credit-related Costs in the aggregated figures of the Three Banks
resulted in ¥23.3 billion, due to continued improvement of corporate business performance and other factors, remaining at low
levels.
Credit-related Costs in the aggregated figures of the Three Bank resulted in reversal of reserves for possible losses of ¥23.3 billion.

 Outstanding Balance of NPLs
Status of Disclosed Claims
The Three Banks' aggregated figures of Disclosed Claims under the Financial Reconstruction Law (FRL) increased by ¥193.9 billion
from the end of the previous fiscal year to ¥1,246.7 billion. The classifications of those loans are shown in the table on page 92.
Of the total, Claims with Collection Risk or worse claims increased by ¥234.5 billion to ¥720.7 billion mainly due to worsening
business performance of certain major clients.
At the same time, Claims for Special Attention decreased by ¥40.6 billion to ¥526.0 billion, mainly due to the improved classification of some portion of Claims with Collection Risk as a result of the steady progress in corporate business performance.
NPL Ratio
The aggregated NPL ratio for the Three Banks as of the end of March 2007 increased by 0.23 percentage points to 1.65% due tothe increase of Claims with Collection Risk or worse claims, remaining at low levels.
 Treatment of NPLs
Centralized management of recovery and final disposal of NPLs by a specialized division facilitate continued efforts to revitalize
corporations and collect debts through a disposal of collateral.
The division works to strengthen management and collection systems and realize efficient and expeditious disposals by utilizing
schemes for corporate revitalization including transfer of business and M&A and bulk sales of NPLs.
Mizuho Servicing Co., Ltd., a servicer of the group, intensively collects NPLs for the group banks and affiliated companies.

 Activities in Corporate Revitalization
We consider support for corporate revitalization to be an important mission for a financial institution. We are doing our utmost to
provide such support including verification of business plans of corporations tackling revitalization and provision of advice pertaining to reconstruction measures.

 Results of Removal of NPLs from the Balance Sheet
We have proceeded with through collection and final disposal of NPLs as well as improvement in the classification of claims
through corporate revitalization.
As the assets as object of removal are on a declining trend backed by continued improvement of corporate business performance and other factors, the group removed ¥293.5 billion in NPLs in fiscal 2006, decreasing by ¥535.4 billion from the previous
fiscal year. As a result, the removal ratio for NPLs amount categorized before fiscal 2005 has exceeded approximately 95% as ofthe end of March in 2007, so removal from the balance sheet is almost complete.
The group will steadily proceed with removal of NPLs from the perspective of improvement of asset quality.

88 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 Provisionfor (Reversal of) General Reserve for Possible Losses on Loans)

2007

¥

Losses on Write-offs of Loans
Reversal of Reserves for Possible Losses on Loans, etc.
Credit Costs for Trust Accounts

40.1

2006

¥

(53.2)

Change

¥

93.4

142.6

84.7

57.9

67.1
(102.4)—37.1(139.3)
1.4

29.9
36.9
(1.4)

2007

2006

Credit-Related Costs (the Three Banks)
Billions of yen

For the Fiscal Years ended March 31,

Credit-related Costs
Credit Costs for Trust Accounts
Reversal of General Reserve for Possible Losses on Loans
Losses on Write-offs of Loans
Provision for (Reversal of) Specific Reserve for Possible Losses on Loans
Reversal of Reserve for Possible Losses on Loans to Restructuring Countries
Provision for (Reversal of) Reserve for Contingencies
Other (including Losses on Sales of Loans)

¥

23.3
—
(121.8)
(8.5)
184.3
(0.3)
(28.2)(1.9)¥(63.9)
1.4(10.7)
36.9(135.3)
(2.4)
35.4
10.7

Change

¥

87.2
(1.4)
(111.1)(45.5)
319.7
2.0(63.7)(12.6)

89

Financial Analysis

Status of Asset Quality

 Overview of NPLs as of March 31, 2007 (the Three Banks) (Banking Accounts)
Billions of yen

1. Self-Assessment
Category IV
Category III (Non-Collateralized)

Categorization

NonCategorization Category II

Bankrupt and Substantially
Bankrupt Obligors
122.2

Collateral, Guarantees, etc.:
102.2
Reserves for Possible Losses:
20.0

Reserve
Ratio
100%

467.8

122.8

Collateral, Guarantees, etc.:
185.8
Reserves for Possible Losses:
281.9

Reserve
Ratio
69.6%

Obligor

122.2

Watch Obligors

Intensive Control
Obligors
590.7

Claims for Special
Attention
525.9

Reserve Ratio against
Uncovered Portion
32.6%
Collateral, Guarantees, etc.:
184.2
Reserves for Possible Losses:
111.4

DirectWrite-offs

2. Disclosed Claims
under the FRL

3. Non-Accrual, Past
Due & Restructured
Loans

Claims against Bankrupt
and Substantially Bankrupt
Obligors
122.2

Loans to Bankrupt Obligors
27.5

Coverage Ratio 100%

Amounts forreserves arerecorded under
Non-Categorization

Claims against Special
Attention Obligors·Coverage Ratio: 57.8%·Reserve Ratiofor Uncovered Portion: 32.2%·Reserve Ratio
against Entire Claim: 20.0%

Claims with Collection Risk
590.7

Non-Accrual
Delinquent Loans
619.5

Coverage Ratio 79.1%
66.0 (Note 2)

Claims for Special
Attention (Note 1)
525.9
Coverage Ratio 56.2%

Loans Past Due forThree Months or More
10.4
Restructured Loans
515.2

Special Attention Obligors
Other Watch Obligors
Normal Obligors

Total
75,506.9

Reserve Ratio
against Total Claims·Other Watch Obligors: 7.39%·Normal Obligors: 0.11%

Total Coverage
Ratio 71.4%

Total
1,238.9

Total
1,172.8

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 FRL represents the amount of claims other than loans included in Disclosed Claims under
the FRL.

90

 Status of Disclosed Claims under the FRL
Disclosed Claims under the FRL (Consolidated)(Consolidated)
Billions of yen

As of March 31,

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention
Total

2007

¥

139.0
596.3
528.6

2006

¥

Change

156.9
362.9
567.7

¥

(17.9)
233.4(39.1)¥ 1,263.9¥ 1,087.5

¥

176.3

2007

2006

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

¥

536.3

¥

805.2

Change¥(268.9)(Trust Accounts)
Billions of yen

As of March 31,

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention
Total

2007

2006

Change

¥

—
7.7
0.1

¥

—
—
0.0

¥

—
7.7
0.0

¥

7.8

¥

0.0

¥

7.7

(Consolidated and Trust Accounts)
Billions of yen

As of March 31,

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention
Total

2007

¥

139.0
604.0
528.7

¥ 1,271.8

2006¥

Change

156.9
362.9
567.7

¥

(17.9)
241.1(39.0)¥ 1,087.6

¥

184.1

91

Financial Analysis

Status of Asset Quality

Disclosed Claims under the FRL (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

As of March 31,

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

2007

¥

Subtotal¥

1,246.7

Normal Claims
Total

122.2
598.4
526.0

2006

130.8
355.2
566.7

Change¥1,052.8

74,313.0

73,236.0¥ 75,559.7¥ 74,288.8

(8.5)
243.1
(40.6)
193.9
1,076.9¥

1,270.9

Notes:1. Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.
2. Reserve for Indemnification of Impairment and Reserve for Possible Losses on Entrusted Loans of ¥1.3 billion and ¥3.2 billion as of March 31, 2007 and 2006, respectively, are not included in theabove figures for Trust Accounts.
Billions of yen

2007

Amount of Partial Direct Write-offs

¥

502.8

2006

¥

725.0

Change¥(222.1)

Ratio of Disclosed Claims under the FRL (the Three Banks) (Banking Accounts and Trust Accounts)%

As of March 31,

2007

2006

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

0.16%
0.79
0.69

0.17%
0.47
0.76

Change(0.01)%
0.31(0.06)

Subtotal

1.65

1.41

0.23

Normal Claims

98.34

98.58

(0.23)

100.00%100.00%/Total
Note: Above figures are presented net of partial direct write-offs.

Disclosed Claims under the FRL and Coverage Amount (the Three Banks) (Banking Accounts)
Billions of yen

As of March 31,

Claims against Bankrupt and Substantially Bankrupt Obligors
Collateral, Guarantees, and equivalent
Reserves for Possible Losses
Claims with Collection Risk
Collateral, Guarantees, and equivalent
Reserves for Possible Losses
Claims for Special Attention
Collateral, Guarantees, and equivalent
Reserves for Possible Losses
Total
Collateral, Guarantees, and equivalent
Reserves for Possible Losses
Note: Above figures are presented net of partial direct write-offs.

92

2007

2006

Change

¥

122.2
102.2
20.0
590.7
185.8
281.9
525.9
184.2
111.4

¥

130.8
117.0
13.8
355.2
194.6
117.2
566.6
200.1
124.5

¥

(8.5)
(14.8)
6.2
235.4
(8.7)
164.7
(40.7)(15.8)(13.1)¥

1,238.9
472.3
413.4

¥

1,052.8
511.7
255.6

¥

186.1
(39.4)
157.8

Coverage on Disclosed Claims under the FRL (the Three Banks) (Banking Accounts)
Billions of yen, %As of March 31,

Coverage AmountReserves for Possible Losses on Loans
Collateral, Guarantees, and equivalent

2007

¥

885.8
413.4
472.3

2006

¥

767.3
255.6
511.7

Change

¥

118.4
157.8
(39.4)

Coverage Ratio
Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention(Claims against Special Attention Obligors)

71.4%
100.0
79.1
56.2
57.8

72.8%
100.0
87.7
57.2
59.5

(1.3)%
—
(8.5)
(1.0)
(1.7)

Reserve Ratio against Non-collateralized Claims
Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention(Claims against Special Attention Obligors)

100.0%
69.6
32.6
32.2

100.0%
72.9
33.9
34.3

—%
(3.3)
(1.3)
(2.0)

(Reference) Reserve Ratio
Claims against Special Attention Obligors
Claims against Watch Obligors excluding Claims against Special Attention Obligors
Claims against Normal Obligors

20.05%
7.39
0.11

21.11%
11.35
0.11(1.06)%(3.95)(0.00)

Note: Above figures are presented net of partial direct write-offs.

93

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,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans
Total

2007

¥

30.8
633.1
10.4
517.9

2006

¥

Change

32.8
454.7
13.9
553.3

¥

(1.9)
178.3
(3.5)
(35.3)¥ 1,192.3¥ 1,054.9

¥

137.4

2007

2006

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

¥

518.3

¥

782.7

Change¥(264.4)

Ratio to Total Loans%

As of March 31,

2007

2006

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

0.04%
0.95
0.01
0.78

0.05%
0.69
0.02
0.84

(0.00)%
0.26(0.00)(0.06)

1.80%

1.61%

0.19%

2007

2006

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

¥

856.3
500.8
352.3
3.1

¥

814.1
615.7
194.9
3.4

Change¥42.1(114.9)
157.4
(0.3)

Note: Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.
Billions of yen

2007

Amount of Partial Direct Write-offs

¥

536.9

2006

¥

805.6

Change¥(268.7)

Reserve Ratios for Non-Accrual, Past Due & Restructured Loans%

As of March 31,

2007

2006

ChangeAfter Partial Direct Write-offs

71.81%

77.18%(5.36)%

Note: Reserve Ratio = Reserves for Possible Losses on Loans / Total Non-Accrual, Past Due & Restructured Loans.

94

(Trust Accounts)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans
Total

2007

2006

Change

¥

—
7.7
0.1
—

¥

—
—
—
0.0

¥

—
7.7
0.1
(0.0)

¥

7.8

¥

0.0

¥

7.7

Ratio to Total Loans%

As of March 31,

2007

2006

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

.—.%
14.58
0.22
.—.

.—%
.—
.—
0.03

.—%
14.58
0.22
(0.03)

14.80%

0.03%

14.76%

2007

2006

Change

32.8
454.7
13.9
553.4

¥

Non-Accrual, Past Due & Restructured Loans / Total Loans(Consolidated and Trust Accounts)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans
Total

¥

30.8
640.8
10.5
517.9

¥

(1.9)
186.1
(3.4)
(35.4)¥ 1,200.2¥ 1,054.9¥ 145.2

As of March 31,

2007

2006

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

0.04%
0.97
0.01
0.78

0.05%
0.69
0.02
0.84

(0.00)%
0.27(0.00)(0.06)

1.81%

1.61%

0.20%

Note: Above figures are presented net of partial direct write-offs.

Ratio to Total Loans%

Non-Accrual, Past Due & Restructured Loans / Total Loans
Note: Above figures are presented net of partial direct write-offs.

95

Financial Analysis

Status of Asset Quality

 Status of Non-Accrual, Past Due & Restructured Loans (the Three Banks)(Banking Accounts and Trust Accounts)
Non-Accrual, Past Due & Restructured Loans
Billions of yen

As of March 31,

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans
Total

2007

¥

27.5
627.2
10.5
515.2

2006

¥

Change

28.7
432.5
13.9
552.3

¥

(1.1)
194.6
(3.4)
(37.0)¥ 1,180.7¥ 1,027.6

¥

153.0

2007

2006

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

¥

485.6

¥

703.5

Change¥(217.9)Ratio to Total Loans%

As of March 31,

2007

2006

ChangeLoans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for Three Months or More
Restructured Loans

0.04%
0.93
0.01
0.77

0.04%
0.65
0.02
0.83

(0.00)%
0.28(0.00)(0.06)

1.76%

1.55%

0.21%

2007

2006

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

¥

741.1
446.3
291.6
3.1

¥

703.7
568.2
132.0
3.4

Change¥37.3(121.8)
159.6
(0.3)

Note: Above figures are presented net of partial direct write-offs, the amounts of which are indicated in the table below.
Billions of yen

2007

Amount of Partial Direct Write-offs

¥

503.1

2006

¥

725.1

Change¥(222.0)Reserve Ratios for Non-Accrual, Past Due & Restructured Loans%

As of March 31,

2007

2006

ChangeAfter Partial Direct Write-offs

63.18%

68.48%(5.29)%

Note: Reserve Ratio = Reserves for Possible Losses on Loans / Total Non-Accrual, Past Due & Restructured Loans.

96 Status of Loans by Industry
Outstanding Balances by Industry (Consolidated)

Billions of yen, %As of March 31,

2007
Outstanding
Balance Composition

2006
Outstanding
Balance Composition

ChangeOutstanding
Balance Composition

Domestic Total (excluding Loans Booked Offshore)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Communication
Transportation
Wholesale & Retail
Finance & Insurance
Real Estate
Service Industries
Local Governments
Governments
Other¥ 57,078.7
7,073.2
37.1
1.0
2.4
138.9
1,366.8735.2
720.7
2,724.7
5,850.3
4,950.3
6,645.8
7,712.3
374.8
5,724.9
13,019.5¥ 58,465.2
7,364.0
41.6
1.1
4.2
131.9
1,465.9
949.0
775.2
2,903.2
6,426.3
6,760.6
6,989.0
7,488.0
340.2
4,234.1
12,590.2

100.00%
12.60
0.07
0.00
0.01
0.23
2.51
1.62
1.33
4.97
10.99
11.56
11.95
12.81
0.58
7.24
21.53

¥ (1,386.5)(290.8)
(4.5)
(0.1)
(1.7)
7.0
(99.1)(213.7)(54.4)(178.4)(576.0)(1,810.3)(343.1)224.2
34.6
1,490.8429.2/(0.21)%
0.00
0.00
0.00
0.01
(0.11)(0.33)(0.07)(0.20)(0.74)(2.89)(0.31)
0.70
0.08
2.79
1.28

Overseas Total (including Loans Booked Offshore)
Governments
Financial Institutions
Other

8,885.5
298.9
1,587.4
6,999.1

100.00
3.36
17.87
78.77

6,943.3
250.5
1,379.5
5,313.2

100.00
3.61
19.87
76.52

1,942.1
48.4
207.8
1,685.9/(0.25)(2.00)
2.25¥ 65,964.3/¥ 65,408.6

/

555.6

/

Total

100.00%
12.39
0.07
0.00
0.01
0.24
2.40
1.29
1.26
4.77
10.25
8.67
11.64
13.51
0.66
10.03
22.81

¥

Note: 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.

Outstanding Balances by Industry (the Three Banks) (Banking Accounts and Trust Accounts)

Billions of yen, %As of March 31,

2007
Outstanding
Balance Composition

2006
Outstanding
Balance Composition

ChangeOutstanding
Balance Composition

Domestic Total (excluding Loans Booked Offshore)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Communication
Transportation
Wholesale & Retail
Finance & Insurance
Real Estate
Service Industries
Local Governments
Governments
Other¥ 60,963.0
7,081.1
37.1
1.0
2.4
138.9
1,366.8735.2
2,079.9
2,728.8
5,853.2
6,754.3
6,711.8
7,723.9393.4
5,704.9
13,649.5¥ 60,685.2
7,389.2
41.6
1.1
4.2
131.9
1,472.7
949.1
779.3
2,967.7
6,441.8
8,136.2
7,059.4
7,498.8387.7
4,234.1
13,190.0¥

Overseas Total (including Loans Booked Offshore)
Governments
Financial Institutions
Other

8,158.5
295.7
1,846.0
6,016.6

100.00
3.62
22.63
73.75

6,302.3
247.7
1,281.3
4,773.2¥ 69,121.5/¥ 66,987.5

Total

100.00%
11.62
0.06
0.00
0.00
0.23
2.24
1.21
3.41
4.48
9.60
11.08
11.01
12.67
0.64
9.36
22.39

Note: Loans to Finance & Insurance sector include loans to MHFG as follows:
As of March 31, 2007: ¥1,380.0 billion (from MHCB ¥690.0 billion; from MHBK ¥690.0 billion)
As of March 31, 2006: ¥965.0 billion (from MHCB ¥342.0 billion; from MHBK ¥623.0 billion)

100.00%
12.18
0.07
0.00
0.01
0.22
2.43
1.56
1.28
4.89
10.61
13.41
11.63
12.36
0.64
6.98
21.73

277.8
(308.0)
(4.5)
(0.1)
(1.7)
7.0
(105.8)(213.8)1,300.6(238.8)(588.5)(1,381.8)(347.6)225.0
5.7
1,470.8459.5/(0.56)%(0.01)
0.00(0.01)
0.01(0.19)(0.35)
2.13(0.41)(1.01)(2.33)(0.62)
0.31
0.00
2.38
0.66

100.00
3.93
20.33
75.74

1,856.1
48.0
564.6
1,243.4/(0.31)
2.30(1.99)/¥ 2,133.9/

97Financial Analysis

Status of Asset Quality

Disclosed Claims under the FRL by Industry and Coverage Ratio (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen, %As of March 31,

2007
Disclosed Claims
under the FRL Coverage Ratio

2006
Disclosed Claims
under the FRL Coverage Ratio

ChangeDisclosed Claims
under the FRL Coverage Ratio

Domestic Total(excluding Loans Booked Offshore)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Communication
Transportation
Wholesale & Retail
Finance & Insurance
Real Estate
Service Industries
Local Governments
Governments
Other¥ 1,203.0
86.4
0.0
0.0
0.1
0.0
54.5
0.0
6.4
181.4
192.7
278.0
114.1
124.0
31.4
—
133.1

¥ 1,002.3
95.3
0.4
0.0
0.0
0.0
46.7
0.1
6.0
217.9
177.8
4.9
176.0
129.7
—
—
147.1

¥

Overseas Total(including Loans Booked Offshore)
Governments
Financial Institutions
Other

43.7
4.6
7.3
31.7

Total

¥ 1,246.7

71.9%
72.1
100.0
68.4
19.4
17.2
57.6
100.0
66.6
73.1
56.5
70.4
85.8
63.5
100.0
—
90.9
64.5
17.2
94.2
64.5
71.4%

50.4
2.9
7.5
39.9
¥ 1,052.8

73.0%
73.7
85.3
100.0
72.3
100.0
73.4
100.0
70.1
67.4
61.4
55.6
85.9
63.8
—
—
88.2
69.7
17.5
93.4
69.1
72.8%

¥

200.6
(8.9)
(0.3)
(0.0)
0.1
0.0
7.8
(0.0)
0.4
(36.4)
14.9
273.1(61.8)(5.6)
31.4—(13.9)(1.1)%(1.5)
14.6(31.5)(52.8)(82.7)(15.8)
—
(3.5)
5.7
(4.8)
14.7
(0.0)
(0.2)
100.0
—
2.6

(6.7)
1.6
(0.2)
(8.1)

(5.2)
(0.3)
0.8
(4.5)

193.9

(1.3)%

Non-Accrual, Past Due & Restructured Loans by Industry (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

As of March 31,

2006

Domestic Total(excluding Loans Booked Offshore)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Communication
Transportation
Wholesale & Retail
Finance & Insurance
Real Estate
Service Industries
Local Governments
Governments
Other¥ 1,140.2
80.2
0.0
0.0
0.1
0.0
52.6
0.0
5.9
180.3
188.2
272.4
113.8
121.3
3.9
—
120.8

Overseas Total(including Loans Booked Offshore)
Governments
Financial Institutions
Other

40.4
4.6
6.4
29.3

45.7
2.9
6.7
35.9

¥ 1,180.7¥ 1,027.6

Total

98

2007

¥

981.9
91.9
0.4
0.0
0.0
0.0
46.0
0.1
6.0
217.7
176.6
4.9
174.7
128.8
—
—
134.4

Change¥158.3(11.6)
(0.3)
—
0.1
0.0
6.6
(0.0)
(0.0)
(37.4)
11.6
267.5(60.8)(7.4)
3.9—(13.5)
(5.3)
1.6
(0.2)
(6.6)

¥

153.0

 Status of Loans by Nationality of Borrowers
Balance of Loans to Restructuring Countries (Consolidated)
As of March 31, 2007

Billions of yen, %As of March 31, 2006

Billions of yen, %Indonesia
Others (3 Countries)¥ 28.90.1

Indonesia
Others (4 Countries)¥ 25.20.0

Total
Ratio to Total Assets¥ 29.1
0.01%

Total
Ratio to Total Assets¥ 25.30.01%

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.

Balance of Loans to Restructuring Countries (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen, Number of countries

As of March 31,

2007

Loan Amount
Number of Restructuring Countries

¥

2006

45.6
4

¥

33.8
5

Change

¥

11.8
(1)

Notes: 1. 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.
2. Number of Restructuring Countries refers to obligors' countries of residence.

Outstanding Balances and Non-Accrual, Past Due & Restructured Loans by Nationality of Borrowers (the Three Banks)(Banking Accounts and Trust Accounts)
Billions of yen

As of March 31,

2007
Non-Accrual,
Outstanding
Past Due &Restructured Loans
Balance2006

ChangeNon-Accrual,
Outstanding
Past Due &Balance
Restructured Loans

Outstanding
Balance

Non-Accrual,
Past Due &Restructured Loans

Asia
China
Hong Kong
Thailand¥ 2,482.7
420.4
401.5
322.3

¥ 18.07.6
0.8
0.3¥ 1,872.6
348.5
323.1
273.2

¥ 14.4
2.3
1.4
1.6

Central and South America

2,164.2

0.2

1,156.9

0.7

1,007.2(0.4)

North America

2,123.6

5.7

1,894.6

36.1

229.0

(30.4)

Eastern Europe

42.0

—

29.1

—

12.9

—

Western Europe

2,480.8

5.8

1,836.2

8.9

644.5

(3.1)

Other

858.4

4.0

550.4

1.3

307.9

2.7

Total

¥ 10,152.0¥ 33.9¥ 7,340.1¥ 61.6¥ 2,811.8¥ (27.7)

¥

610.0
71.8
78.3
49.1

¥

3.5
5.3
(0.5)
(1.2)

99

Financial Analysis

Status of Asset Quality

 Results of Removal of NPLs from the Balance Sheet
Outstanding Balances of Claims against Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk
(under the FRL) (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

Up to Fiscal As of September As of March As of September As of March As of September As of March
2003
30, 2004
31, 2005
30, 2005
31, 2006 30, 2006 (a) 31, 2007 (b)Amount Categorized as below
up to Fiscal 2003

¥ 8,356.1 ¥747.0 ¥

268.8 ¥ 169.1 ¥ 103.2

of which the amount in the processof being removed from the balance sheet

933.5

253.4

119.0

74.7

28.9

23.7

19.6

(4.1)

2,216.6
6,139.4

334.4
412.5

143.0
125.7

90.2
78.9

43.0
60.1

32.5
49.5

27.8
41.7

(4.7)
(7.7)

515.7

72.3

46.3

35.5

29.1

27.2

(1.8)

39.9

25.6

17.6

14.9

12.0

12.0

(0.0)

65.8
449.9

26.3
46.0

20.8
25.5

17.5
17.9

14.9
14.2

14.3
12.9

(0.6)
(1.2)

674.1

499.7

114.8

93.3

45.8

(47.4)

24.1

22.6

13.9

31.2

6.9

(24.3)

40.1
634.0

22.8
476.8

38.2
76.6

33.0
60.2

8.3
37.4

(24.7)(22.7)

148.9

81.6

50.6

28.1

(22.4)

23.0

12.1

7.0

5.4

(1.6)

27.5
121.4

15.8
65.8

7.8
42.7

5.9
22.2

(1.9)
(20.5)

150.8

82.4

56.4

(26.0)

14.4

8.5

5.4

(3.0)

16.2
134.5

9.7
72.7

8.3
48.1

(1.3)
(24.6)

122.8

88.0

(34.8)

12.2

10.2

(1.9)

16.6
106.1

38.3
49.6

21.6
(56.4)

405.3

405.3

17.9

17.9

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the First Half of Fiscal 2004
of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the Second Half of Fiscal 2004
of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the First Half of Fiscal 2005of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the Second Half of Fiscal 2005of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the First Half of Fiscal 2006of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Amount Newly Categorized as below
during the Second Half of Fiscal 2006

¥

82.1

of which the amount in the processof being removed from the balance sheet

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Total

/ ¥ 1,262.8 ¥ 1,015.3 ¥ 864.2 ¥ 486.1¥ 460.5¥ 69.6 ¥ (12.5)

19.1
19.1
386.1
386.1
¥ 720.7 ¥ 260.1

of which the amount in the processof being removed from the balance sheet

/

293.4

168.7

138.0

84.4

94.9

77.7

(17.1)

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk

/
/

400.2
862.5

209.5
805.8

161.4
702.7

130.8
355.2

114.8
345.7

122.2
598.4

7.4
252.6

Note: Figures from fiscal 2003 to the first half of fiscal 2005 include those of financial subsidiaries for corporate revitalization.

100

Change(b)-(a)Progress in Removal from the Balance Sheet (Accumulated Removal Amount and Removal Ratio)(the Three Banks) (Banking Accounts and Trust Accounts)
AmountNewly
Categolized

Up to Fiscal 2003
First Half of Fiscal 2004
Second Half of Fiscal 2004
First Half of Fiscal 2005
Second Half of Fiscal 2005
First Half of Fiscal 2006
Second Half of Fiscal 2006
Total

Balance
as of March 31,
2007

Billions of yen%

Accumulated
RemovalAmountAccumulated
Removal Ratio

ModifiedAccumulated
Removal Ratio¥ 8,356.1
515.7
674.1
148.9
150.8
122.8
405.3

¥

69.6
27.2
45.8
28.1
56.4
88.0
405.3

¥

8,286.4
488.5
628.3
120.7
94.3
34.8
/

99.1%
94.7
93.2
81.0
62.5
28.3
/

99.4%
97.0
94.2
84.7
66.1
36.6
/

¥10,374.0

¥

720.7

¥

9,653.2//

Notes: 1. Modified accumulated removal ratios are based on the accumulated removal amount including the amount which was in the process of being removed from the balance sheet.
2. Figures from fiscal 2003 to the first half of fiscal 2005 include those of financial subsidiaries for corporate revitalization.

Breakdown of Reasons for Removal from the Balance Sheet(the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

Newly Categorized as Claims against Bankrupt and Substantially Bankrupt Obligors or Claims with Collection Risk Amount Removed
Up toFirst Half of Second Half ofFirst Half of Second Half ofFirst Half of from BS in the Second
Fiscal 2003
Fiscal 2004
Fiscal 2004
Fiscal 2005
Fiscal 2005
Fiscal 2006 Half of Fiscal 2006

Liquidation

¥

(3.9)

¥

(0.1)

¥

(0.7)

¥

(1.4)

¥

(0.5)

¥

(0.1)

¥

(6.9)

Restructuring

(1.2)

(0.0)

(53.9)

(0.0)

(0.2)

—

(55.5)

Improvement in Business Performancedue to Restructuring
Loan Sales—(25.7)

—
(0.4)

(0.9)
(3.1)

—
(2.1)

(0.0)
(5.1)

(0.0)
(1.4)

(1.0)
(38.0)

Direct Write-off

29.6

1.3

56.1

(8.8)

2.6

0.0

81.0

Other
Debt Recovery
Improvement in Business Performance(11.2)
(8.3)
(2.9)

(2.5)
(1.5)
(0.9)

(44.7)(7.0)(37.6)

(9.9)
(7.9)
(2.0)

(22.7)(19.4)(3.3)(33.2)(23.4)(9.7)(124.5)(67.7)(56.8)(26.0)¥ (34.8)

Total¥(12.5)

¥

(1.8)

¥

(47.4)¥(22.4)¥¥(145.1)(Reference) Breakdown of Accumulated Amount Removed from the Balance Sheet(the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

Breakdown of Amount Removed
Up to First In Second Half
In First Half In Second Half
In First Half
Half of Fiscal 2004 of Fiscal 2004 of Fiscal 2005 of Fiscal 2005 of Fiscal 2006

Liquidation¥ (1,139.7)¥ (160.3)

Restructuring(1,501.3)(98.6)(12.5)(55.8)

Improvement in Business Performancedue to Restructuring
Loan Sales(172.2)(3,419.8)(2.9)(502.5)(1.0)(153.2)

Direct Write-off

2,429.5

363.0

Other
Debt Recovery
Improvement in Business Performance(3,805.3)//¥ (7,609.1)

Total

¥

(28.5)¥(40.7)¥(6.3)

Accumulated Removed
Amount from BS
In Second Halffrom Second Halfof Fiscal 2006of Fiscal 2000

¥

(6.9)

¥ (1,382.7)(104.7)(55.5)(1,828.8)(3.1)(47.6)(0.0)(34.4)(1.0)(38.0)(180.5)(4,195.8)

99.2

45.8

155.4

81.0

3,174.1(520.0)(291.4)(228.6)(203.8)(148.5)(55.2)(427.3)(217.0)(210.2)(158.2)(113.8)(44.3)(124.5)(67.7)(56.8)(5,239.4)//¥ (921.6)¥ (300.0)¥ (528.9)¥ (148.4)¥ (145.1)¥ (9,653.2)

Notes: 1. Up to First Half of Fiscal 2004 denotes the term from the Second Half of Fiscal 2000 to the First Half of Fiscal 2004.
2. Figures from fiscal 2003 to the first half of fiscal 2005 include those of financial subsidiaries for corporate revitalization.

101

Financial Analysis

Status of Asset Quality

Write-Offs of Loans (the Three Banks) (Banking Accounts)
Billions of yen

For the Fiscal Years ended March 31,

Write-offs of Loans

2007

¥

64.3

2006

¥

65.0

Change¥(0.6)

Note: The above figures are included in Other Expenses on the statement of income.

Principal Amounts of NPLs Sold (the Three Banks) (Banking Accounts and Trust Accounts)
Billions of yen

For the Fiscal Years ended March 31,

Principal Amounts of NPLs Sold
Sales of Loans to RCC
Other Sales

2007

¥

78.8
0.2
78.5

¥

2006

Change

231.0
15.1
215.9

¥ (152.2)(14.8)(137.3)

Note: RCC is the abbreviation for the Resolution and Collection Corporation.

Debt Forgiveness (the Three Banks) (Banking Accounts and Trust Accounts)
Number of cases, Billions of yen

For the Fiscal Years ended March 31,

2007

2006

Number of Cases of Debt ForgivenessBook Value

2
2.6

15
32.6

Note: The above figures do not include debt forgiveness following legal bankruptcy procedures.

102

¥

¥

Change¥(13)(30.0)

Financial Data of Mizuho Financial Group, Inc.
[Under Japanese GAAP]
Report of Independent Auditors

104

Consolidated Financial Statements

105

Notes to Consolidated Financial Statements

112

103

Financial Data of Mizuho Financial Group, Inc.

Report of Independent Auditors

The Board of Directors
Mizuho Financial Group, Inc.
We have audited the accompanying consolidated balance sheets of Mizuho Financial Group, Inc. and consolidated subsidiaries(the “Company”) as of March 31, 2007 and 2006, and the related consolidated statements of income and cash flows for theyears then ended, changes in net assets for the year ended March 31, 2007 and shareholders' equity for the year ended March
31, 2006, all expressed in yen. These financial statements are the responsibility of the Company's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in Japan. Those standards require that weplan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial positionof Mizuho Financial Group, Inc. and consolidated subsidiaries as of March 31, 2007 and 2006, and the consolidated results of
their operations and their cash flows for the years then ended in conformity with accounting principles generally accepted inJapan.
The U.S. dollar amounts in the accompanying consolidated financial statements with respect to the year ended March 31, 2007
are presented solely for convenience. Our audit also included the translation of yen amounts into U.S. dollar amounts and, in our
opinion, such translation has been made on the basis described in Note 1.

Ernst & Young ShinNihon
June 26, 2007

104

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

AssetsCash and Due from Banks (Notes 12, 33 and 38)
Call Loans and Bills Purchased
Receivables under Resale Agreements
Guarantee Deposits Paid under Securities Borrowing Transactions
Other Debt Purchased (Note 38)
Trading Assets (Notes 4, 12 and 38)
Money Held in Trust (Note 38)
Securities (Notes 5, 12, 23 and 38)
Loans and Bills Discounted (Notes 6 and 12)
Foreign Exchange Assets (Note 7)
Other Assets (Notes 8 and 12)
Tangible Fixed Assets (Notes 9, 12 and 24)
Intangible Fixed Assets
Premises and Equipment (Notes 9, 12 and 24)
Deferred Debenture Charges (Note 10)
Deferred Tax Assets (Note 35)
Customers' Liabilities for Acceptances and Guarantees (Note 23)
Reserves for Possible Losses on Loans (Note 11)
Reserve for Possible Losses on Investments
Total Assets¥

3,993,362
302,3369,430,397
8,624,211
3,351,499
10,414,573
49,55836,049,983
65,964,301
894,797
5,739,458
796,746
255,695/
22
389,024
4,480,551(856,314)
(174)

¥

2006

5,016,216
938,435
5,976,043
8,643,570
2,476,132
10,007,149
49,89837,702,957
65,408,672
809,205
6,463,242//
955,888267
423,572
5,556,929(814,178)(1,208)

Thousands of
U.S. dollars (Note 1)
2007$

33,816,262
2,560,219
79,857,717
73,030,835
28,380,893
88,191,832
419,667
305,275,500
558,593,458
7,577,250
48,602,406
6,746,944
2,165,263/
188
3,294,304
37,941,835(7,251,369)(1,480)¥ 149,880,031¥ 149,612,794$ 1,269,201,724

Liabilities, Net Assets, Minority Interests and Shareholders' Equity
Liabilities
Deposits (Notes 12 and 13)¥ 83,608,304
Debentures (Note 14)
4,723,806
Call Money and Bills Sold (Notes 12 and 15)
6,924,136
Payables under Repurchase Agreements (Note 12)12,821,752
Guarantee Deposits Received under Securities Lending Transactions (Note 12)5,946,781
Commercial Paper (Note 16)
30,000
Trading Liabilities (Note 4)
8,297,301
Borrowed Money (Notes 12 and 17)
4,563,438
Foreign Exchange Liabilities (Note 7)
339,817
Short-term Bonds (Note 18)
849,870
Bonds and Notes (Note 19)
3,237,525
Due to Trust Accounts
1,135,358
Other Liabilities (Notes 12 and 20)
5,770,656
Reserve for Bonus Payments
40,972
Reserve for Employee Retirement Benefits (Note 21)
37,641
Reserve for Director and Corporate Auditor Retirement Benefits
6,484
Reserve for Contingencies
13,046
Reserves under Special Laws (Note 22)
2,680
Deferred Tax Liabilities (Note 35)
218,224Deferred Tax Liabilities for Revaluation Reserve for Land (Note 24)
107,272
Acceptances and Guarantees (Note 23)
4,480,551¥ 82,367,125
6,606,305
9,466,054
10,079,585
7,301,540
50,0007,880,634
2,768,811
389,638
1,385,100
2,488,498
1,354,889
5,382,931
35,374
38,616/45,567
2,352
127,847
120,8735,556,929$¥ 143,448,677$ 1,212,258,639

Total Liabilities¥ 143,155,622

708,004,946
40,001,748
58,634,398
108,576,108
50,358,044
254,043
70,262,521
38,643,730
2,877,611
7,196,805
27,415,747
9,614,352
48,866,600
346,959
318,756
54,915
110,483
22,696
1,847,947
908,395
37,941,835

105

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

Net Assets
Common Stock and Preferred Stock (Note 25)
Capital Surplus
Retained Earnings
Treasury Stock (Note 25)¥

Total Shareholders' Equity

1,540,965
411,1101,440,310(32,330)

/
/
/
/

$

13,049,073
3,481,333
12,196,717(273,778)

3,360,055/

28,453,345

Net Unrealized Gains on Other Securities, net of Taxes (Note 38)
Net Deferred Hedge Losses, net of Taxes
Revaluation Reserve for Land, net of Taxes (Note 24)
Foreign Currency Translation Adjustments
Total Valuation and Translation Adjustments

1,550,628(111,042)
150,616(38,964)
1,551,237

/
/
/
/
/

13,130,905(940,325)
1,275,435(329,954)
13,136,061

Minority Interests

1,813,115/

15,353,679

6,724,408/

56,943,085¥ 149,880,031/$ 1,269,201,724

1,359,122/

1,540,965
411,160
1,498,143
170,384
1,279,216(48,062)(46,814)

/
/
/
/
/
/
/

Total Net Assets
Total Liabilities and Net Assets
Minority Interests/

Shareholders' Equity
Common Stock and Preferred Stock (Note 25)
Capital Surplus
Retained Earnings
Revaluation Reserve for Land, net of Taxes (Note 24)
Net Unrealized Gains on Other Securities, net of Taxes (Note 38)
Foreign Currency Translation Adjustments
Treasury Stock (Note 25)

/
/
/
/
/
/
/

¥

Total Shareholders' Equity/

4,804,993/

Total Liabilities, Minority Interests and Shareholders' Equity/¥ 149,612,794/

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

106

2006

Thousands of
U.S. dollars (Note 1)
2007

Consolidated Statements of Income
Millions of yen
2007

For the Fiscal Years ended March 31,

IncomeInterest Income (Note 26)
Fiduciary Income
Fee and Commission Income
Trading Income (Note 27)
Other Operating Income (Note 28)
Other Income (Note 30)¥

Total Income
Expenses
Interest Expenses (Note 26)
Fee and Commission Expenses
Trading Expenses (Note 27)
Other Operating Expenses (Note 29)
General and Administrative Expenses
Other Expenses (Notes 31 and 32)
Total Expenses
Income before Income Taxes and Minority Interests
Income Taxes:
Current
Deferred
Minority Interests in Net Income
Net Income¥

2,562,642
66,958658,899
265,802
270,945522,816¥2006

1,935,048
78,843
650,549
211,029354,481502,212

Thousands of
U.S. dollars (Note 1)
2007$

21,700,761
567,015
5,579,638
2,250,851
2,294,398
4,427,272

4,348,066

3,732,166

36,819,935

1,472,378
107,775
4,258
123,438
1,091,602
573,714872,403
94,614
6,088
254,408
1,095,243
429,265

12,468,275
912,653
36,062
1,045,288
9,243,816
4,858,283

3,373,167

2,752,024

28,564,377

974,898

980,1428,255,558

43,267
223,699
86,96564,038185,035
81,164366,396
1,894,314
736,438

620,965¥

649,903$5,258,410

Per Share of Common StockYen
As of March 31,

Net Income:
Basic
DilutedCash Dividends

2007

¥

51,474.49
48,803.07
7,000.00

2006¥

55,157.14
46,234.51
4,000.00

U.S. dollars (Note 1)
2007$

435.89413.2759.28

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

107

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statements of Changes in Net Assets
Revaluation Net Unrealized Gains
Reserve for Land, on Other Securities,
net of Taxes
net of Taxes

Common Stockand Preferred Stock

CapitalSurplusRetained
Earnings

Balance as of April 1, 2005
Changes during the period
MergerTransfer from Revaluation
Reserve for Land, net of Taxes
Cash Dividends
Net Income
Repurchase of Treasury Stock
Disposition of Treasury Stock
Cancellation of Treasury Stock
Other
Change during the period (net)Total Change during the period¥ 1,540,965¥ 1,022,571¥ 1,048,530¥ 198,945—

74,290(74,290)

—

—

—
—
—
—
—
—
—
—
—

—
—
—
—
441,972(1,127,672)——(611,410)

25,858(75,883)
649,903——(75,976)——
449,612

—
—
—
—
—
—
—
(28,560)(28,560)

—
—
—
—
—
—
—
741,189
741,189

Balance as of March 31, 2006

¥ 1,540,965

411,160¥ 1,498,143¥ 170,384¥ 1,279,216

For the Fiscal Year ended March 31, 2006¥¥

538,027*Above table is given as the statement of shareholders' equity.

Shareholders' Equity

For the Fiscal Year ended March 31, 2007

Balance as of March 31, 2006
Changes during the fiscal year
Cash Dividends*1
Board Members' Bonuses*1
Net Income
Repurchase of Treasury Stock
Disposition of Treasury Stock
Cancellation of Treasury Stock
Transfer from Revaluation
Reserve for Land, net of Taxes
Decrease in Stock issued by MHFG
held by Equity-method Affiliates
Net Changes in Items other thanShareholders' Equity
Total Changes during the fiscal year
Balance as of March 31, 2007

Common Stockand Preferred Stock

CapitalSurplusRetained
Earnings

TreasuryStock

Total Shareholders'Equity¥ 1,540,965¥ 411,160¥ 1,498,143¥ (46,814)¥ 3,403,455

—
—
—
—
—
—

—
—
—
—
32
(83)

(79,849)(36)
620,965——(618,680)———(604,331)
50
618,763(79,849)(36)
620,965(604,331)
83
—

—

—

19,768—19,768

—

—

—

0

0

—
—

—
(50)

—
(57,832)—
14,483—(43,399)¥ 1,540,965¥ 411,110¥ 1,440,310¥ (32,330)¥ 3,360,055

Shareholders' Equity

For the Fiscal Year ended March 31, 2007

Balance as of March 31, 2006
Changes during the fiscal year
Cash Dividends*1
Board Members' Bonuses*1
Net Income
Repurchase of Treasury Stock
Disposition of Treasury Stock
Cancellation of Treasury Stock
Transfer from Revaluation
Reserve for Land, net of Taxes
Decrease in Stock issued by MHFG
held by Equity-method Affiliates
Net Changes in Items other thanShareholders' Equity
Total Changes during the fiscal year
Balance as of March 31, 2007

108

Common Stockand Preferred Stock

CapitalSurplusRetained
Earnings

TreasuryStock

Total Shareholders'Equity$13,049,073$3,481,760$12,686,453$(396,428)$28,820,858

—
—
—
—
—
—

—
—
—
—
277
(704)

(676,177)(308)
5,258,410——(5,239,061)———(5,117,546)
429
5,239,765(676,177)(308)
5,258,410(5,117,546)
706
—

—

—

167,400—

167,400

—

—

—

2

2

—
—

—
(427)

—
(489,736)—
122,650—(367,513)$13,049,073$3,481,333$12,196,717$(273,778)$28,453,345*1 Appropriation of Retained Earnings approved at the ordinary general meeting of shareholders in June 2006
*2 See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

Millions of yen

Foreign Currency
Translation
Adjustments¥¥

Treasury
Stock

Total
Shareholders'Equity(48,757)¥ (394,555)¥ 3,905,726

—

—

—

—
—
—
—
—
—
—
695
695

—
—
—
(944,321)
88,416
1,203,648(2)—
347,740

25,858(75,883)
649,903(944,321)
530,388—(2)
713,323
899,266(48,062)¥ (46,814)¥ 4,804,993
Millions of yen

Net Unrealized Gains
on Other Securities,
net of Taxes

Valuation and Translation Adjustments
Net Deferred
Revaluation
Foreign Currency
Hedge Losses,
Reserve for Land,
Translation
net of Taxes
net of Taxes
Adjustments

Total Valuation
and Translation
Adjustments¥

Minority Interests

Total Net Assets—¥ 170,384¥ (48,062)¥ 1,401,538¥ 1,359,122¥ 6,164,116

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

(79,849)(36)
620,965(604,331)
83
—

—

—

—

—

—

—

19,768

—

—

—

—

—

—

0

271,411
271,411(111,042)(111,042)(19,768)(19,768)

9,098
9,098

149,698
149,698

453,992
453,992

603,691
560,292¥ 1,550,628¥ (111,042)¥ 150,616¥ (38,964)¥ 1,551,237¥ 1,813,115¥ 6,724,408¥ 1,279,216

Thousands of U.S. dollars (Note 1)

Net Unrealized Gains
on Other Securities,
net of Taxes

Valuation and Translation Adjustments
Net Deferred
Revaluation
Foreign Currency
Hedge Losses,
Reserve for Land,
Translation
net of Taxes
net of Taxes
Adjustments

Total Valuation
and Translation
Adjustments$

Minority Interests

Total Net Assets—$1,442,835$(406,999)$11,868,394$11,509,213$52,198,465

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

—
—
—
—
—
—

(676,177)(308)
5,258,410(5,117,546)
706
—

—

—

—

—

—

—

167,400

—

—

—

—

—

—

2

2,298,347
2,298,347(940,325)(940,325)(167,400)(167,400)

77,04577,045

1,267,667
1,267,667

3,844,466
3,844,466

5,112,133
4,744,620$13,130,905$ (940,325)$1,275,435$(329,954)$13,136,061$15,353,679$56,943,085$10,832,558

109

Financial Data of Mizuho Financial Group, Inc.

Consolidated Financial Statements

Consolidated Statements of Cash Flows
For the Fiscal Years ended March 31,

Millions of yen
2007

I. Cash Flow from Operating Activities
Income before Income Taxes and Minority Interests¥
974,898
Depreciation
132,228
Losses on Impairment of Fixed Assets
4,281
Amortization of Goodwill
758
Amortization of Consolidation Differences/
Equity in Income from Investments in Affiliates(9,324)
Increase (Decrease) in Reserves for Possible Losses on Loans
34,099Decrease in Reserve for Possible Losses on Investments(1,034)
Increase (Decrease) in Reserve for Contingencies(32,520)
Increase in Reserve for Bonus Payments
4,385
Increase (Decrease) in Reserve for Employee Retirement Benefits(1,076)
Increase in Reserve for Director and Corporate Auditor Retirement Benefits
6,484Interest Income—accrual basis(2,562,642)
Interest Expenses—accrual basis
1,472,378
Losses (Gains) on Securities
84,020Gains on Money Held in Trust(41)
Foreign Exchange Gains—net(180,289)
Losses on Disposition of Fixed Assets
428
Gains on Disposition of Premises and Equipment/
Gains on Cancellation of Employee Retirement Benefit Trust(125,961)
Net Decrease (Increase) in Trading Assets(255,216)
Net Increase (Decrease) in Trading Liabilities
246,107
Net Increase in Loans and Bills Discounted(153,790)
Net Increase in Deposits
721,639
Net Decrease in Debentures(1,884,284)
Net Increase in Borrowed Money (excluding Subordinated Borrowed Money)
1,841,174
Net Decrease (Increase) in Due from Banks (excluding Due from Central Banks)
751,656
Net Increase in Call Loans, etc.
(3,267,835)
Net Decrease in Guarantee Deposits Paid under Securities Borrowing Transactions
19,358Net Increase (Decrease) in Call Money, etc.
(446,971)
Net Decrease in Commercial Paper(20,000)
Net Decrease in Guarantee Deposits Received under Securities Lending Transactions (1,354,758)
Net Increase in Foreign Exchange Assets(75,975)
Net Increase (Decrease) in Foreign Exchange Liabilities(50,229)
Net Increase (Decrease) in Short-term Bonds (Liabilities)(535,229)
Net Increase in Bonds and Notes
753,664
Net Decrease in Due to Trust Accounts(219,530)Interest and Dividend Income—cash basis
2,482,364
Interest Expenses—cash basis(1,387,389)
Board Members' Bonuses(70)
Other—net(19,684)
Subtotal
Cash Paid in Income Taxes
Net Cash Used in Operating Activities

110

¥

2006

980,142
119,417
22,360/68(9,161)(333,202)(5,042)35,459633
1,330/(1,935,048)
872,403(39,952)(437)(241,237)/(3,723)/
1,122,067(124,224)(2,266,529)
1,955,474(1,188,767)
161,779(399,103)(2,722,165)
36,7702,552,697(1,347,200)(333,495)(91,837)
96,563
1,124,800
104,042(12,680)
1,940,172(879,807)/(618,666)

Thousands of
U.S. dollars (Note 1)
2007$

8,255,558
1,119,725
36,2596,427/(78,962)
288,757(8,757)(275,389)
37,133(9,113)54,915(21,700,761)
12,468,275
711,499(351)(1,526,710)
3,632/(1,066,660)(2,161,201)
2,084,065(1,302,312)
6,110,925(15,956,341)
15,591,279
6,365,116(27,672,413)
163,932(3,785,003)(169,362)(11,472,258)(643,369)(425,351)(4,532,385)
6,382,123(1,859,014)
21,020,957(11,748,576)(593)(166,692)(3,053,924)(51,009)(1,426,099)(243,028)(25,860,996)(431,952)(3,104,934)(1,669,128)(26,292,948)

Consolidated Statements of Cash Flows2006

Thousands of
U.S. dollars (Note 1)
2007(66,512,317)
30,852,118
35,572,415(50,347)
29,433//(58,263)//
67,722(25)(500,066,092)
297,879,740
230,597,506(476,662)
477,616(657,969)(885,128)/
406,477
8,892/(6,775)

Millions of yen
2007

II. Cash Flow from Investing Activities
Payments for Purchase of Securities(59,052,804)
Proceeds from Sale of Securities
35,176,618
Proceeds from Redemption of Securities
27,231,259
Payments for Increase in Money Held in Trust(56,289)
Proceeds from Decrease in Money Held in Trust
56,401
Payments for Purchase of Tangible Fixed Assets(77,699)
Payments for Purchase of Intangible Fixed Assets(104,524)
Payments for Purchase of Premises and Equipment/
Proceeds from Sale of Tangible Fixed Assets
48,000
Proceeds from Sale of Intangible Fixed Assets
1,050
Proceeds from Sale of Premises and Equipment/
Payments for Purchase of Stocks of Subsidiaries (affecting the scope of consolidation)(800)
Net Cash Provided by (Used in) Investing Activities

3,221,212(99,262)

27,277,605

III. Cash Flow from Financing Activities
Proceeds from Issuance of Subordinated Borrowed Money
Repayments of Subordinated Borrowed Money
Proceeds from Issuance of Subordinated Bonds
Payments for Redemption of Subordinated Bonds
Proceeds from Investments in Minority Shareholders
Cash Dividends Paid
Cash Dividends Paid to Minority Shareholders
Payments for Repurchase of Treasury Stock
Proceeds from Sale of Treasury Stock64,600(112,000)
309,334(350,000)
415,734(79,793)(60,908)(604,331)
83

278,000(307,054)
367,177(386,515)
141,857(75,725)(50,478)(944,321)
530,388547,044(948,429)
2,619,479(2,963,841)
3,520,488(675,700)(515,780)(5,117,546)
707(417,280)(446,671)(3,533,578)

2,103

928

17,811

V. Net Decrease in Cash and Cash Equivalents(298,898)(2,214,133)(2,531,110)

VI. Cash and Cash Equivalents at the beginning of the fiscal year

3,387,929

5,602,062

28,689,384

Net Cash Used in Financing Activities
IV. Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents

VII. Net Decrease in Cash and Cash Equivalents Resulting from Exclusionof Subsidiaries from the Scope of Consolidation
VIII. Cash and Cash Equivalents at the end of the fiscal year (Note 33)(0)¥3,089,030—¥

3,387,929(0)$

26,158,274

See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

111

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 Japanand the Securities 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 the consolidated 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 ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation. The inclusion of suchamounts is not intended to imply that Japanese yen has been or could be readily converted, realized or settled into U.S. dollars atthat rate or any other rate.

2. Principles of Consolidation(1) Scope of Consolidation
The consolidated financial statements include the accounts of MHFG and its consolidated subsidiaries (collectively, the“Group”), including Mizuho Corporate Bank, Ltd. (“MHCB”), Mizuho Bank, Ltd. (“MHBK”), Mizuho Trust & Banking Co., Ltd.
(“MHTB”), Mizuho Securities Co., Ltd. (“MHSC”) and certain other subsidiaries. The number of consolidated subsidiaries as ofMarch 31, 2007 and 2006 was 133 and 130, respectively. In the fiscal year ended March 31, 2007, Mizuho Investment
Management (UK) Ltd. and 6 other companies were newly consolidated upon their establishment and so on. Finance &Servicing Corporation and 3 other companies were excluded from the scope of consolidation as a result of dissolution.
The number of affiliates under the equity method as of March 31, 2007 and 2006 was 19 and 19, respectively. Investments
in affiliates include The Chiba Kogyo Bank, Ltd., Shinko Securities Co., Ltd., Japan Mortgage Co., Ltd. and certain other affiliates. In the fiscal year ended March 31, 2007, since MHFG adopted the “Practical Solution on Application of Control Criteria
and Influence Criteria to Investment Associations” (the Accounting Standards Board of Japan (“ASBJ”) Report No.20,
September 8, 2006), Japan Industrial Fund I and two other companies were newly included in the scope of the equity method.
In the fiscal year ended March 31, 2007, Basic Capital Management, Limited and two other companies were excluded fromthe scope of the equity method as a result of becoming a MHFG's subsidiary due to an increase in the equity position throughadditional stock repurchases, and other factors. Non-consolidated subsidiaries, including Asian-American Merchant Bank
Limited and certain other affiliates, are not under the equity method, as they are not significant to the consolidated financial
statements of MHFG.
In consolidation, all significant intercompany accounts and transactions have been eliminated. In addition, all significant
unrealized profits included in assets resulting from transactions within the Group have been eliminated.
The accounting standards applicable to the consolidated financial statements require a company to consolidate all subsidiaries of which the company controls the operations, irrespective of whether or not the company owns a majority of theirshares. Control is considered to exist where the company has (a) the power to appoint or remove the majority of the Board of
Directors or an equivalent governing body, and/or (b) the power to cast the majority of the votes at a meeting of the Board of
Directors or an equivalent governing body.
(2) Year-end Dates of Consolidated Subsidiaries
The accompanying consolidated financial statements include the accounts of subsidiaries whose fiscal year-ends are other thanMarch 31. Fiscal year-ends of such subsidiaries are principally December 31.
Consolidated subsidiaries with fiscal year-ends of the day before the last business day of June, of September 30 and of
October 31, performed tentative closings and prepared financial statements as of and for the period ended December 31. Other
consolidated subsidiaries were consolidated based on their financial statements as of 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.
(3) Evaluation of Assets and Liabilities of Consolidated Subsidiaries
Assets and Liabilities of consolidated subsidiaries, including the portion attributable to minority shareholders, are valued at fairvalue as of the respective date of acquisition.

112

(4) Amortization of Goodwill
As a rule, goodwill (including the difference between the fair value of net assets and the acquisition cost of acquired subsidiaries for March 31, 2006) is amortized over a period up to 20 years under the straight-line method. If the amount has nomaterial impact on MHFG's consolidated financial statements, the entire amount is amortized in the period of occurrence.
(5) Report on the response to Investment Associations
In response to the “Practical Solution on Application of Control Criteria and Influence Criteria to Investment Associations”(ASBJ Report No.20, September 8, 2006) effective from the fiscal year ending upon or after the public announcement, MHFG
adopted the new accounting standard commencing with this fiscal year. This adoption has no effect on the consolidated balance sheet since investment associations deemed subsidiaries in the ASBJ report had already been consolidated.
3. Summary of Significant Accounting Policies(1) Trading Assets and Trading Liabilities
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 and recordedin Trading Assets or Trading Liabilities on the consolidated balance sheet.
Securities and other short-term credit instruments held for trading purposes are stated at fair value at the consolidated balance sheet date. Derivative financial products, such as swaps, forward contracts and option transactions, are stated at their fairvalues, assuming that such transactions were terminated and settled at the consolidated balance sheet date.
Trading Income and Trading Expenses include the interest received and interest paid during the fiscal year, the gains or losses
resulting from any change in the value of securities and monetary claims between the beginning and the end 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.
(2) 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 and affiliates, 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, determined by the moving average method.
(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 or losses, net of
applicable income taxes after excluding gains and losses as a result of fair-value hedge method, included directly in Net
Assets (Shareholders' Equity as of March 31, 2006). Fair value of Japanese stocks with a quoted market price is determinedbased on the average quoted market price over the month preceding the consolidated balance sheet date. Fair value of
securities other than Japanese stocks is determined at the quoted market price if available, or other reasonable value at theconsolidated balance sheet date (cost of securities sold is calculated primarily by the moving average method). Other securities which do not have readily determinable fair values are stated at acquisition cost or amortized cost as determined by themoving average method.
In addition, investments in non-consolidated subsidiaries and affiliates which are not under the equity method are stated atacquisition cost as determined by the moving 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 Other Securities which have readily determinable fair value are devalued to the fair value, and the difference
between the acquisition cost and the fair value is treated as the loss for the fiscal year (“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) unless it is deemed that there is a possibility of a recovery in the fair value, the fair value is taken
as the amount recorded. The amount of devaluation was ¥3,247 million ($27,500 thousand) and ¥3,259 million for the fiscal
years ended March 31, 2007 and 2006, respectively.
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 price maintains
a certain level or lower

113

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(3) Securities Lending and Borrowing Transactions
Unsecured securities loaned that allow borrowers to sell, amounted to ¥5,093 million ($43,136 thousand) and ¥23,862 million
as of March 31, 2007 and 2006, respectively, and were included in stocks in Securities and trading securities in Trading Assets.
Securities loaned that do not allow borrowers to sell amounted to ¥570 million as of March 31, 2006, and were included in
Securities.
A portion of unsecured borrowed securities, securities purchased under resale agreements and securities borrowed with cash
collateral have the right to sell or repledge out of which securities repledged were ¥8,769,615 million ($74,262,135 thousand)and ¥7,143,008 million as of March 31, 2007 and 2006, respectively, securities re-loaned were ¥262 million ($2,220 thousand)and ¥255 million as of March 31, 2007 and 2006, respectively, and securities neither repledged nor re-loaned were ¥5,528,908
million ($46,819,443 thousand) and ¥4,999,963 million as of March 31, 2007 and 2006, respectively.
(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, although the banking subsidiaries have rights to sell or pledge
certain bankers' acceptances, commercial bills, documentary bills and foreign exchange bills. The principal amount of these bills
amounted to ¥861,428 million ($7,294,679 thousand) and ¥889,999 million as of March 31, 2007 and 2006, respectively.
(5) Derivatives
Derivative transactions are valued at fair value with changes in fair value included in current income. Derivatives qualifying ashedges are mainly accounted for using either the fair-value hedge method or the deferral method of hedge accounting (see thefollowing note).
(6) Hedge Accounting
Consolidated subsidiaries apply the deferred method, the fair-value hedge method or the exceptional accrual method for interest rate swaps as hedge accounting methods.
The portfolio hedge for large-volume, small-value financial assets and liabilities of domestic consolidated banking subsidiaries
and domestic consolidated trust banking subsidiaries is accounted for by the method stipulated in “Accounting and Auditing
Treatment relating to Adoption of Accounting Standards for Financial Instruments for Banks”( JICPA Industry Audit Committee
Report No.24).
The effectiveness of hedging activities for the portfolio hedge for large-volume, small-value financial assets and liabilities isassessed as follows:(i) for hedging activities to offset market fluctuation risks, bracketing both the hedging instruments, such as interest-rate
swaps, and hedged instruments, such as deposits and loans, in the same maturity bucket, and assessing the effectivenessbetween hedging and hedged instruments.
(ii) for hedging activities to fix the cash flows, the effectiveness is assessed based on the correlation between a base interest
rate index of the hedged cash flow and that of the hedging instrument.
The effectiveness of the individual hedge is assessed based on the correlation between the fluctuation in the market or cash
flows of the hedged instruments and that of the hedging instruments.
Deferred hedge gains/losses recorded on the consolidated balance sheet resulted from the application of the macro-hedge
method based on “Tentative Accounting and Auditing Treatment relating to Adoption of Accounting Standards for Financial
Instruments for Banks” (JICPA Industry Audit Committee Report No.15), under which the overall interest rate risks inherent inloans, deposits and other instruments are controlled on a macro-basis using derivatives transactions. These deferred hedge
gains/losses are amortized as interest income or interest expenses over the average remaining maturity of the respective hedging instruments.
The unamortized amounts of gross deferred hedge losses on the macro-hedges were ¥241,602 (before net of applicabletaxes) million ($2,045,922 thousand) and ¥363,399 million as of March 31, 2007 and 2006, respectively. The unamortizedamounts of gross deferred hedge gains on the macro-hedges were ¥229,553 (before net of applicable taxes) million($1,943,886 thousand) and ¥357,446 million as of March 31, 2007 and 2006, respectively.
Domestic consolidated banking subsidiaries and a certain domestic consolidated trust banking subsidiary apply the deferred
method of hedge accounting to hedge foreign exchange risks associated with various foreign currency denominated monetary
assets and liabilities as stipulated in “Accounting and Auditing Treatment relating to Adoption of Accounting Standards for
Foreign Currency Transactions for Banks” (JICPA Industry Audit Committee Report No.25). The effectiveness of the hedge isassessed by confirming both the amount for the foreign currency position of the hedging instruments of currency-swap transactions, exchange swap transactions and similar transactions as the method of hedging the foreign exchange risks of monetary
assets and liabilities denominated in foreign currencies and the amount for the foreign currency position of the hedged monetary assets and liabilities denominated in foreign currency are equivalent.
114

In addition to the above methods, these subsidiaries apply the deferred method or the fair-value hedge method to portfolio
hedges of the foreign exchange risks associated with investments in subsidiaries and affiliates in foreign currency and Other
securities in foreign currency (except for Japanese bonds and foreign 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 in foreign currency.
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 recognizedin the statement of income or deferred under hedge accounting, because these inter-company derivatives are executed according to the criteria for appropriate outside third-party cover operations which are treated as hedge transactions objectively inaccordance with JICPA Industry Audit Committee Reports Nos.24 and 25.

(7) Translation of Foreign Currencies
Assets and liabilities denominated in foreign currencies and accounts of overseas branches of domestic banking subsidiaries anda domestic trust banking subsidiary are translated into Japanese yen primarily at the exchange rates in effect at the consolidated balance sheet date, with the exception of the investments in non-consolidated subsidiaries and affiliates not under theequity method, which are translated at historical exchange rates.
Assets and liabilities denominated in foreign currencies of the consolidated subsidiaries, except for the above transactions, aretranslated into Japanese yen primarily at the exchange rates in effect at each balance sheet date.
(8) Tangible Fixed Assets (Premises and Equipment as of March 31, 2006)
Depreciation of buildings is computed mainly by the straight-line method, and that of equipment is computed mainly by the
declining-balance method with the following range of useful lives:
Buildings
3 years to 50 years
Equipment
2 years to 20 years(9) Intangible Fixed Assets
Amortization of Intangible Fixed Assets is computed by the straight-line method. Development costs for internally-used software are capitalized and amortized over their estimated useful lives of mainly five years as determined by MHFG and consolidated subsidiaries.
(10) Deferred Assets• Bond issuance costs are expensed as incurred.
• Until the fiscal year ended March 31, 2006, debenture issuance costs were capitalized and amortized over a certain period
not exceeding the maximum period stipulated by the former Enforcement Regulations of the Commercial Code of Japan.
However, in accordance with the application of the “Tentative Solution on Accounting for Deferred Assets” (ASBJ Report No.
19, August 11, 2006) effective from the fiscal year ending upon or after the public announcement of such, MHFG adopted
the new accounting standard commencing with the fiscal year ended March 31, 2007. The effect of this change mentioned
above on the consolidated balance sheet is immaterial. Debenture issuance costs booked on the consolidated balance sheet
as of March 31, 2006 are amortized under the straight-line method within a certain period by applying the previous accounting method based on the tentative measure stipulated in the ASBJ report.
• Until the fiscal year ended March31, 2006, bond discounts and debenture discounts were capitalized and amortized under
the straight-line method over the term of the bonds and debentures. However, in accordance with the partial revision of“Accounting Standards for Financial Instruments” (the Business Accounting Deliberation Council, January 22, 1999) as ofAugust 11, 2006 (ASBJ Statement No.10) and the application effective from the fiscal year ending upon or after the publicannouncement of such, MHFG adopted the revised accounting standard commencing with the fiscal year ended March 31,
2007, and bonds and debentures were stated at amortized cost (straight-line method). The effect of this application on the
consolidated balance sheet is immaterial. Bond discounts and debenture discounts booked on the consolidated balance sheet
as of March 31, 2006 are amortized under the straight-line method over the term of the bond and debenture by applying theprevious accounting method and the unamortized balance is directly deducted from bonds and debentures, based on thetentative measure stipulated in the “Tentative Solution on Accounting for Deferred Assets” (ASBJ Report No.19, August 11,2006).

115

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(11) Reserves for Possible Losses on Loans
Reserves for Possible Losses on Loans of major domestic consolidated subsidiaries are maintained in accordance with internallyestablished standards for write-offs and provisions:• For claims extended to obligors that are legally bankrupt under the Bankruptcy Law, Special Liquidation under the Company
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 expectedamounts recoverable from the disposal of collateral and the amounts recoverable under guarantees.
• For claims extended to obligors that are not yet legally or formally bankrupt but are likely to be bankrupt (“Intensive Control
Obligor”), reserves are maintained at the amounts deemed necessary based on overall solvency analyses of the amounts ofclaims net of expected amounts recoverable from the disposal of collateral and the amounts recoverable under guarantees.
• For claims extended to Intensive Control Obligors and Obligors with Restructured Loans (defined in Note 6 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 is applied,
under which method the reserve is determined as the difference between the book value of the loan and its present valueof 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 the losses estimated for each individual loan.
• For claims extended to other obligors, reserves are maintained at rates derived from historical credit loss experience andother factors.
• Reserves for Possible Losses on Loans to Restructuring Countries are maintained in order to cover possible losses basedon analyses of the political and economic climates of the countries.
Claims are assessed by each claim origination department, and the results of the assessments are verified and examinedby the independent examination departments. Reserves for Possible Losses on Loans are provided for on the basis ofsuch verified assessments.
In the case of claims to Bankrupt Obligors and Substantially Bankrupt Obligors, which are collateralized or guaranteed by athird party, the amounts deemed uncollectible (calculated by deducting the anticipated proceeds from the sale of collateralpledged against the claims and amounts that are expected to be recovered from guarantors of the claims) are written off
against the respective claims balances. The total directly written-off amounts were ¥536,916 million ($4,546,670 thousand)and ¥805,616 million as of March 31, 2007 and 2006, respectively.
The claims above include corporate bonds which are guaranteed by domestic consolidated banking subsidiaries and areissued by private placement (Article 2, Paragraph 3 of the Securities and Exchange Law) and others in securities.
Other consolidated subsidiaries provide the amount necessary to cover the loan losses based upon past experience for generalclaims and the estimation for each individual loan for other claims.
(12) Reserve for Possible Losses on Investments
Reserve for Possible Losses on Investments is maintained to provide against possible losses on investments in securities, after
taking into consideration the financial condition and other relevant factors concerning the investee company.
(13) Reserve for Bonus Payments
Reserve for Bonus Payments, which is provided for future bonus payments to employees, is maintained at the amount accruedat the end of the fiscal year, based on the estimated future payments.
(14) Reserve for Employee Retirement Benefits
Reserve for Employee Retirement Benefits (including Prepaid Pension Cost), which is provided for future benefit payments toemployees, is recorded as the required amount, based on the projected benefit obligation and the estimated plan asset
amounts at the end of the fiscal year. Prior Service cost (Gains on plan amendment) is recognized as income or expenses in the
period of occurrence for the fiscal year ended March 31, 2006. Unrecognized actuarial differences are recognized as income or
expenses from the following fiscal year under the straight-line method over a certain term within the average remaining service
period of the employees of the respective fiscal year.
On July 1, 2005, a certain domestic consolidated subsidiary received approvals for an exemption from payments of benefits
related to past employee services in respect of the substitutional portion of their pension funds from the Minister of Health,
Labor and Welfare, based on the Law Concerning Defined Benefit Corporate Pension Plans. As a result, ¥1,216 million was
included in Other Income.

116

(15) Reserve for Director and Corporate Auditor Retirement Benefits
Until the fiscal year ended March 31, 2006, MHFG and certain domestic consolidated subsidiaries recognized director and corporate auditor retirement benefits as expenses at the time of payment. However, in accordance with the public announcementof the “Accounting Standard for Directors' Bonus” (ASBJ Statement No.4, November 29, 2005) and the “Auditing Treatment
relating to Reserve defined under the Special Tax Measurement Law, Reserve defined under the Special Law and Reserve for
Director and Corporate Auditor Retirement Benefits” (The Japanese Institute of Certified Public Accountants (“JICPA”) Auditing
and Assurance Practice Committee Report No.42, April 13, 2007), these benefits are recorded as Reserve for Director andCorporate Auditor Retirement Benefits at the required amount as of March 31, 2007, based on internally established standards.
As a result, Income before Income Taxes and Minority Interests decreased by ¥5,788 million ($49,021 thousand), comparedwith the corresponding amounts under the previously applied method.
(16) Reserve for Contingencies
Reserve for Contingencies is maintained to provide against possible losses from contingencies, which are not covered by otherspecific reserves, in off-balance transactions and trust transactions and other. The balance is an estimate of possible future
losses, on an individual basis, considered to require a reserve.
(17) Lease Transactions
Finance leases of MHFG and domestic consolidated subsidiaries that do not involve the transfer of ownership to the lessee areaccounted for as operating leases.
Lease transactions of foreign consolidated subsidiaries are principally accounted for as either finance leases or operatingleases, depending on the terms and conditions of the lease.
(18) Scope of Cash and Cash Equivalents in Consolidated Statements of Cash Flows
In the Consolidated Statements 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.
(19) Fiduciary Income
Until the fiscal year ended March 31, 2005, Fiduciary Income was primarily recognized at the end of each trust accounting
period. However, effective the fiscal year ended March 31, 2006, Fiduciary Income is accrued for the period elapsed with some
exceptions, such as not calculated for trust accounting periods, in order to improve the accuracy of earnings reports and continuously provide appropriate information considering present broader disclosure requirements. As a result of this change,
Fiduciary Income and Income before Income Taxes and Minority Interests for the fiscal year ended March 31, 2006, eachincreased by ¥2,059 million compared with corresponding amounts under the previously applied method.
(20) Income Taxes
Deferred income taxes are recorded for corporate tax, inhabitants' taxes and enterprise taxes based on the differences between
the tax bases of assets and liabilities and those reported in the consolidated financial statements and tax losses carried forward,
using enacted tax rates which will be in effect when the differences are expected to be reversed. The assets and liabilities
method is used to determine deferred income taxes.
(21) Consumption Taxes
MHFG and its domestic consolidated subsidiaries are subject to Japanese consumption taxes. Japanese consumption taxes are
excluded from transaction amounts.
(22) Treasury Stock, Capital Reserve and Appropriated Reserve“Accounting Standards for Treasury Shares and Appropriation of Legal Reserve” (ASBJ Statement No.1, February 21, 2002) and“Guidance on Accounting Standards for Treasury Shares and Appropriation of Legal Reserve” (ASBJ Guidance No.2, February
21, 2002) were partially revised as of December 27, 2005 and August 11, 2006. Given that the revisions apply to procedures
stipulated by the Company Law, MHFG has applied the above standards and guidance commencing with the fiscal year ended
March 31, 2007. The effect of this application on the consolidated balance sheet is immaterial.

117

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(23) Consolidated Statements of Changes in Net Assets(i) Types and number of outstanding shares and of treasury stock are as follows:
Thousands of Shares

Outstanding shares
Common stock
Fourth Series Class IV Preferred Stock
Sixth Series Class VI Preferred Stock
Eleventh Series Class XI Preferred StockThirteenth Series Class XIII Preferred Stock
Total

As of
March 31, 2006

Increase during
the fiscal year

Decrease during
the fiscal year

As of
March 31, 2007

12,003
150
150
943
36

—
—
—
—
—

131
150
150
—
—

11,872——943
36

13,284—431

12,852

396
—
—

0
150
150

131
150
150

265
—
—

396

300

431

265

Treasury stock
Common stock
Fourth Series Class IV Preferred Stock
Sixth Series Class VI Preferred Stock
Total

Remarks

*1
*2
*2

*3
*2
*2

*1 Decreases are due to cancellation of treasury stock (common stock).
*2 Increases and decreases are due to repurchase and cancellation of treasury stock (preferred stock).
*3 Increases are due to repurchase of fractional shares (0 thousand shares), decreases are due to cancellation of treasury stock (131 thousand
shares of common stock) and additional purchase of fractional shares (0 thousand shares).

(ii) Cash dividends distributed by MHFG are as follows (non-consolidated basis):
Cash dividends paid during the fiscal year ended March 31, 2007
Cash Dividends
Cash Dividends
Resolution

June 27,
2006

(

)

Ordinary
General Meetingof Shareholders

Types(Millions of yen)(Thousand of
U.S. dollars)Common Stock¥ 48,005$ 406,517

Fourth Series Class IV
Preferred Stock

7,140

60,462Sixth Series Class VI
Preferred Stock

6,300

Eleventh Series Class XI
Preferred StockThirteenth Series Class XIII
Preferred Stock

Total

Cash Dividends
per Share

Cash Dividends
per Share(Yen)(U.S. dollars)

RecordDate

33.87

March 31,2006

47,600403.08March 31,
2006

53,34942,000355.66

March 31,2006

18,874

159,834

20,000169.36

March 31,
2006

1,100

9,321

30,000254.04

March 31,2006

¥ 81,421$ 689,483

/

/

¥

4,000

$

Effective
Date

June 27,2006

Cash dividends with record dates falling in the fiscal year ended March 31, 2007 and effective dates coming after the end of
the fiscal year
Cash Dividends
Types(Millions of yen)(Thousand of
U.S. dollars)

Resource ofDividends

Common Stock¥ 83,081$ 703,544

Retained
Earnings

Eleventh Series Class XI
Preferred Stock18,874

159,834

Retained
Earnings

Thirteenth Series Class XIII
Preferred Stock

1,100

9,321

Retained
Earnings¥ 103,056$ 872,699

Cash Dividends
Resolution

June 26,
2007

(

)

Ordinary
General Meetingof Shareholders

Total

118

Cash Dividends Cash Dividends
per Shareper Share(Yen)¥(U.S. dollars)

RecordDate

59.28

March 31,2007

20,000169.36

March 31,2007

30,000254.04

March 31,
2007

/

/

7,000

$

Effective
Date

June 26,
2007

(iii) “Accounting Standards for Statement of Changes in Net Assets” (ASBJ Statement No.6, December 27, 2005) and“Guidance on Accounting Standards for Statement of Changes in Net Assets” (ASBJ Guidance No.9, December 27, 2005)
took effect as of the fiscal year ended on or after the enforcement date of the Company Law. Thus, the standards and guidance were adopted commencing with the fiscal year ended March 31, 2007, with the “Consolidated Statement of Changes
in Net Assets” newly prepared instead of the former “Consolidated Statement of Capital Surplus and Retained Earnings.”(24) Appropriation of Retained Earnings
Cash dividends are recorded in the fiscal year in which the proposed appropriation of Retained Earnings is approved by the
Board of Directors and/or by the general meeting of shareholders.
(25) Changes in Presentation Required by the Revision of “Banking Law Enforcement Regulations”
The appendix forms of “Banking Law Enforcement Regulations” (Ministry of Finance Ordinance No.10, 1982) have beenrevised by the “Cabinet Office Ordinance to Amend Part of Detailed Enforcement Regulations on Mutual Loan Business Law
and Banking Law” (Cabinet Office Ordinance No.60, April 28, 2006), following the application of “Accounting Standards for
Presentation of Net Assets in the Balance Sheet” (ASBJ Statement No.5, December 9, 2005) and “Guidance on AccountingStandards for Presentation of Net Assets in the Balance Sheet” (ASBJ Guidance No.8, December 9, 2005) effective from the fiscal year ending on or after the enforcement date of the Company Law. In accordance with the application of the revised“Banking Law Enforcement Regulations” commencing with the fiscal year beginning on or after April 1, 2006, presentation of
account items has been changed as follows:(1) Former “Shareholders' Equity” is presented as “Net Assets” and classified into “Shareholders' Equity,” “Valuation andTranslation Adjustments” and “Minority Interests.”
The amount corresponding to former “Shareholders' Equity” as of the end of the fiscal year ended March 31, 2007 was¥5,022,335 million ($42,529,732 thousand).
(2) The net realized and unrealized losses from hedging instruments formerly included in “Other Assets” as deferred hedge
losses are presented as “Net Deferred Hedge Losses, net of Taxes” included in Valuation and Translation Adjustments, netof applicable income taxes.
(3) “Minority Interests” formerly listed after Liabilities is included in Net Assets.
(4) Former “Premises and Equipment” is classified into “Tangible Fixed Assets,” “Intangible Fixed Assets” and “Other
Assets.”(5) Software and other items formerly included in “Other Assets” are presented in “Software” and “Other Intangible Fixed
Assets” included in “Intangible Fixed Assets.”(6) Amortization of consolidation differences formerly recognized as “Other Expenses” is included as amortization of intangible fixed assets in “General and Administrative Expenses.”(7) Former “Amortization of Consolidation Differences” is included in “Amortization of Goodwill” on the consolidated statement of Cash Flows.
(8) Former “Losses (Gains) on Disposition of Premises and Equipment” on the consolidated statement of Cash Flows is presented as “Losses (Gains) on Disposition of Fixed Assets” and others following the new classification of former “Premises
and Equipment” on the consolidated balance sheet into “Tangible Fixed Assets,” “Intangible Fixed Assets” and others.
Former “Payments for Purchase of Premises and Equipment” is presented as “Payments for Purchase of Tangible Fixed
Assets” and others, and former “Proceeds from Sale of Premises and Equipment” is presented as “Proceeds from Sale ofTangible Fixed Assets” and others.
(9) Payments for purchase and proceeds from sale of software and others formerly included in “Other—net” under “CashFlow from Operating Activities” are included in “Payments for Purchase of Intangible Fixed Assets” and “Proceeds from
Sale of Intangible Fixed Assets” under “Cash Flow from Investing Activities.”

119

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(26) Per Share Information
Per share Information as of or for the fiscal years ended March 31, 2007 and 2006 are calculated based on the following information:
Yen
As of or for the fiscal years ended March 31,

Net Assets per Share of Common StockNet Income per Share of Common Stock
Diluted Net Income per Share of Common Stock

2007

2006

¥ 336,937.64
51,474.49
48,803.07¥ 274,906.95
55,157.14
46,234.51

U.S. dollars
2007$

2,853.23
435.89413.27

Notes: 1.“Guidance for Accounting Standards for Net Earning per Share” (ASBJ Guidance No.4, September 25, 2002) revised on January 31,
2006 took effect as of the fiscal year that ended upon or after the enforcement of the Company Law. Accordingly, MHFG has applied
the above guidance commencing with the fiscal year ended March 31, 2007, and included “Net Deferred Hedge Losses, net of Taxes”
in the calculation of net assets per share. As a result, Net Assets per share of common stock as of March 31, 2007 declined by¥9,566.77 ($81.01) compared with the corresponding amount under the previously applied method.
2.Net Assets per Share of Common Stock is based on the following information.
Millions of yen
2007

As of March 31,

Net Assets
Deductions from Net Assets
Paid-in Amount of Preferred Stock
Cash Dividends on Preferred Stock
Minority Interests
Net Assets (year-end) related to Common Stock
Year-end Outstanding Shares of Common Stock, on which
Net Assets per Share of Common Stock was calculated¥

6,724,408
2,813,521
980,430
19,975
1,813,115
3,910,887¥

11,607 Thousand shares

2006

Thousands of U.S. dollars
2007

—
—
—
—
—
—

$

— Thousand shares

56,943,085
23,825,230
8,302,397
169,155
15,353,678
33,117,855/

3.Net Income per Share of Common Stock is based on the following information.
Millions of yen
2007

For the fiscal years ended March 31,

Net Income¥
Amount not attributable to Common StockBoard Members' Bonuses by Appropriation of Retained Earnings
Cash Dividends on Preferred Stock
Deemed Dividends on Cancellation of Preferred StockNet Income related to Common Stock
Average Outstanding Shares of Common Stock (during the period)

620,965¥
23,472—
19,975
3,497
597,492
11,607 Thousand shares

2006

Thousands of U.S. dollars
2007

649,903$
33,67436
33,415222
616,229
11,172 Thousand shares

5,258,410
198,771—
169,155
29,616
5,059,639/

4.Diluted Net Income per Share of Common Stock is based on the following information.
Millions of yen
2007

For the fiscal years ended March 31,

Adjustments to Net Income
Cash Dividends on Preferred Stock
Deemed Dividends on Cancellation of Preferred Stock
Increased Number of Shares of Common Stock
Preferred Stock
Description of dilutive securities which were not includedin the calculation of Diluted Net Income per Share ofCommon Stock as they have no dilutive effects

120¥

18,874¥
18,874—
1,022 Thousand shares
1,022 Thousand shares—

2006

Thousands of U.S. dollars
2007

19,097$
18,874222
2,569 Thousand shares
2,569 Thousand shares—

159,834
159,834—///

4. Trading Assets and Liabilities
Millions of yen
2007

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

¥

8,628,467
1,686,781
99,324¥

2006

Thousands of U.S. dollars
2007

7,988,427
1,911,491
107,231$73,066,880
14,283,860
841,092¥ 10,414,573¥ 10,007,149$

88,191,832¥

6,350,602
1,831,668
115,030¥

5,863,162
1,895,059
122,413$53,777,645
15,510,781
974,095¥

8,297,301¥

7,880,634$

70,262,521

Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 15,490,025
139,208
6,905
3,019,395
6,452,909
10,941,537¥ 20,464,627
176,0235,383
2,701,669
6,344,748
8,010,505$ 131,171,360
1,178,836
58,47925,568,598
54,643,998
92,654,229¥ 36,049,983¥ 37,702,957$ 305,275,500

5. Securities
As of March 31,

Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Japanese Stocks*1
Other*2Total*1 Japanese Stocks included investments in non-consolidated subsidiaries and affiliates of ¥89,230 million ($755,613 thousand) and ¥83,379 million as of March 31, 2007 and 2006, respectively.
*2 Other included investments in non-consolidated subsidiaries and affiliates of ¥4,106 million ($34,771 thousand) and ¥12,461 million as of March 31, 2007 and 2006, respectively.

121

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

6. Loans and Bills Discounted
Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 51,035,595
11,211,926
3,073,674
412,437
228,062
2,604¥ 47,990,138
12,355,086
4,428,935
430,717
203,794—$ 432,175,424
94,943,910
26,028,240
3,492,572
1,931,259
22,053¥ 65,964,301¥ 65,408,672$ 558,593,458

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, 2007 and 2006 include the following:
Millions of yen
2007

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

2006

Thousands of U.S. dollars
2007¥

30,838633,107
10,458517,986¥

32,821
454,712
13,995553,373$

261,1445,361,231
88,567
4,386,374¥

1,192,392¥

1,054,903$

10,097,316*1 Loans to Bankrupt Obligors represent non-accrual loans to obligors who are legally bankrupt as defined in Article 96, Paragraph 1, Item 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 therestructuring 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, the deferral 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.

Commitment Line for Loans
Overdraft protection on current accounts and contracts for 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 is in breachof contract conditions. The unutilized balance of these contracts amounted to ¥53,899,937 million ($456,431,006 thousand) and¥49,246,784 million as of March 31, 2007 and 2006, respectively. Of these amounts, ¥44,504,074 million ($376,865,734 thousand) and ¥42,366,799 million relate to contracts in which the original contractual maturity is one year or less, or which areunconditionally cancelable at any time as of March 31, 2007 and 2006, respectively.
Since many of these contracts expire without the rights exercised, the unutilized balance itself does not necessarily affect future
cash flows. A provision is included in many of these contracts that entitles the consolidated subsidiaries to refuse the execution ofloans, or reduce the maximum amount under contracts when there is a change in the financial situation, necessity to preserve aclaim, or other similar reasons. The banking subsidiaries obtain, moreover, real estate or securities as collateral at the time thecontracts are entered into, if needed, and periodically monitor a customer's business condition, based on and in accordance withestablished internal procedures, and take measures to control credit risks such as making amendments to contracts, if needed.

122

7. Foreign Exchange Assets and Liabilities
Millions of yen
2007

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:
Advance from Foreign Banks
Due to Banks (Foreign)
Foreign Bills Payable
Foreign Bills Sold
Total

2006

Thousands of U.S. dollars
2007¥

460,893
225,339
150,768
57,796¥467,699
278,253
57,805
5,446$

3,902,902
1,908,199
1,276,723
489,426¥

894,797¥809,205$

7,577,250¥

157,926
154,576
16,104
11,209¥9,505
353,773
12,386
13,974$

1,337,343
1,308,974
136,375
94,919¥339,817¥389,638$

2,877,611

Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 2,707,768
440,167—
19,176
2,572,345¥ 1,624,054
334,916
303,961
38,1484,162,162$ 22,929,705
3,727,388—
162,392
21,782,921¥ 5,739,458¥ 6,463,242$ 48,602,406

8. Other Assets
As of March 31,

Derivatives
Accrued Income
Deferred Hedge Losses*1
Prepaid Expenses
Other
Total

*1 Deferred Hedge Losses is the net realized or unrealized losses from hedging instruments. The gross amounts of deferred hedge gains and losses before netting are ¥629,416 million and ¥933,378
million, respectively, as of March 31, 2006.

9. Tangible Fixed Assets
Millions of yen
2007

As of March 31,

Land
Buildings
Construction in Progress
Equipment
Other
Total
Accumulated Depreciation
Book value adjusted for gains on sales of replaced assets and others¥

398,988
265,4393,010/
129,308¥¥

2006

Thousands of U.S. dollars
2007¥

463,404
254,949/
94,839142,695$

3,378,679
2,247,774
25,491/
1,095,000

796,746¥955,888

$6,746,944

705,047
42,659¥729,088
44,647$5,970,427
361,247

Note: Figures as of March 31, 2006 denote the breakdown of Premises and Equipment.

10. Deferred Debenture Charges
Millions of yen
2007

As of March 31,

Deferred Discount on Debentures
Deferred Debenture Issuance Costs
Total

2006

Thousands of U.S. dollars
2007

¥

—
22

¥

145
122

$

—
188

¥

22

¥

267

$

188

123

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

11. Reserves for Possible Losses on Loans
Millions of yen
2007

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

2006

Thousands of U.S. dollars
2007¥(500,863)(352,317)(3,133)¥(615,775)(194,907)(3,495)$(4,241,371)(2,983,464)(26,534)¥(856,314)¥(814,178)$(7,251,369)

Millions of yen
2007

2006

12. Assets Pledged as Collateral
The following assets were pledged as collateral:
As of March 31,

Trading Assets
Securities
Loans and Bills Discounted
Other Assets
Tangible Fixed Assets*1¥

4,260,215
11,394,744
5,887,983
1,405
211

¥

4,241,579
13,508,075
5,524,711
329
99

Thousands of U.S. dollars
2007$

36,076,001
96,492,035
49,860,132
11,901
1,793*1 Tangible Fixed Assets as of March 31, 2006 denote Premises and Equipment.

The following liabilities were collateralized by the above assets:
Millions of yen
2007

As of March 31,

Deposits
Call Money and Bills Sold
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending Transactions
Borrowed Money
Other Liabilities¥

640,082
2,143,279
5,604,841
5,238,721
2,985,346
8,623

¥

2006

1,035,947
4,837,900
4,868,827
6,493,464
1,435,575
90

Thousands of U.S. dollars
2007$

5,420,296
18,149,538
47,462,457
44,362,108
25,280,263
73,025In addition, the settlement accounts of foreign and domestic exchange transactions or derivatives transactions and other werecollateralized, and margins for futures transactions were substituted by Cash and Due from Banks of ¥7,428 million ($62,905
thousand) and ¥7,726 million, Trading Assets of ¥306,986 million ($2,599,596 thousand) and ¥535,821 million, Securities of¥2,973,539 million ($25,180,284 thousand) and ¥2,725,992 million, and Loans and Bills Discounted of ¥360,776 million($3,055,096 thousand) and ¥349,759 million as of March 31, 2007 and 2006, respectively. None of the assets were pledged ascollateral in connection with borrowings by the non-consolidated subsidiaries and affiliates.
Premises and Equipment included guarantee deposits of ¥139,029 million as of March 31, 2006, and Other Assets included
guarantee deposits of ¥120,724 million ($1,022,306 thousand) as of March 31, 2007, collateral pledged for derivatives transactions of ¥489,876 million ($4,148,335 thousand) and ¥342,567 million as of March 31, 2007 and 2006, respectively, margins for
futures transactions of ¥25,814 million ($218,597 thousand) and ¥72,138 million as of March 31, 2007 and 2006, respectively,
and other guarantee deposits of ¥3,888 million ($32,929 thousand) and ¥3,261 million as of March 31, 2007 and 2006, respectively.

12413. Deposits
Millions of yen
2007

As of March 31,

Current Deposits
Ordinary Deposits*1
Deposits at NoticeTime Deposits
Negotiable Certificates of Deposit
Other

¥

Total

6,308,211
32,193,121
663,895
29,891,912
8,805,239
5,745,923¥ 83,608,304

¥

2006

Thousands of U.S. dollars
2007

6,443,127
33,424,056
656,525
27,186,388
9,359,131
5,297,896$¥ 82,367,125

53,418,677
272,615,135
5,621,948
253,128,226
74,563,806
48,657,154$ 708,004,946*1 Ordinary Deposits include savings deposits.

14. Debentures

As of March 31,
IssuerDescription

Millions of yen
2007

MHCB

Coupon Debentures¥

3,159,440[971,950]

MHCB

Three-Year Coupon Debentures

MHCB

Debenture Denominatedin Foreign Currency

MHBK

Discount Debentures

319,486[319,486]

MHBK

Discount Debentures(custody only)

MHBK

¥

Thousands of
U.S. dollars
2007

2006

Interest rates
2007

2006

4,469,090$ 26,754,509[8,230,587]

0.35%–1.20% 0.35%–1.40%—[—]

100,800

—
[—]

—

—
[—]

19,801—[—]— 0.33%–4.98%

482,024

2,705,448[2,705,448]

0.08%–0.37% 0.05%–0.08%

102,087[102,087]

173,211

864,488[864,488]

0.05%–0.34% 0.02%–0.05%

Coupon Debentures

33,490[7,626]53,988283,605[64,578]

0.10%–0.56% 0.10%–0.30%

MHBK

Coupon Debentures(with compound interest)

347,958[70,455]

527,7292,946,551[596,629]

0.10%–0.56% 0.10%–0.30%

MHBK

Coupon Debentures(saving-type)685,371[94,856]

700,360

5,803,806[803,255]

0.10%–0.56% 0.10%–0.30%

MHBK

Coupon Debentures(saving-type with compound interest)

75,972[14,731]

79,300643,341[124,751]

0.10%–0.56% 0.10%–0.30%

6,606,305$ 40,001,748

0.35%(US$ 109,000 thousand)

Total

¥

4,723,806¥

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amount of foreign currency denominated bonds is shown in original currency in parentheses ( ).
3. Repayments for Debentures are scheduled for the next five years as follows:
Fiscal year ending March 31, 2008 ¥1,581,784 million ($ 13,394,734 thousand)2009 ¥ 950,715 million ($ 8,050,769 thousand)2010 ¥ 930,024 million ($ 7,875,554 thousand)2011 ¥ 988,539 million ($ 8,371,068 thousand)2012 ¥ 273,333 million ($ 2,314,620 thousand)4. No collateral was provided for the above debentures.

15. Call Money and Bills Sold
Millions of yen
2007

As of March 31,

2006

Thousands of U.S. dollars
2007

Call Money
Bills Sold¥

6,924,136—¥

6,192,054
3,274,000$ 58,634,398
—

Total

¥

6,924,136¥

9,466,054$ 58,634,398

125

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

16. Commercial Paper
Millions of yen
2007

As of March 31,

Commercial Paper¥

30,000¥2006

50,000

Average interest rates*1
2007
2006

Thousands of U.S. dollars
2007$

254,043

0.66%

0.13%

*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.

17. Borrowed Money
Millions of yen
2007

As of March 31,

Other Borrowings*2,3¥

4,563,438¥

2006

Thousands of U.S. dollars
2007

2,768,811$ 38,643,730

Average interest rates*1
2007
2006

1.10%

0.80%

*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 ¥745,002 million ($6,308,771 thousand) and ¥792,011 million as of March 31, 2007 and 2006, respectively.
*3 Repayments for Other Borrowings are scheduled for the next five years as follows:
Fiscal year ending March 31, 2008
¥3,344,030 million($28,317,645 thousand)2009¥ 47,917 million($ 405,774 thousand)2010¥ 37,393 million($ 316,651 thousand)2011¥ 75,794 million($ 641,835 thousand)2012¥ 141,663 million($ 1,199,623 thousand)

18. Short-term Bonds
Major components of Short-term Bonds at March 31, 2007 were as follows:
Issuer

Issue

MHFG

Jan. 2007–Feb. 2007

MHCB

Feb. 2007–Mar. 2007

MHSC

Millions of yen

Thousands of U.S. dollars

Apr. 2007

402,600[402,600]

3,409,264[3,409,264]

0.48%–0.75%

Apr. 2007–
Jul. 2007

Sep. 2006–Mar. 2007

360,200[360,200]

3,050,216[3,050,216]

0.41%–0.70%

Apr. 2007–
Sep. 2007*1

Jan. 2007–Mar. 2007

34,070[34,070]

288,515[288,515]

0.44%–0.77%

Apr. 2007–
Jun. 2007*2

Mar. 2007

8,000[8,000]67,745[67,745]

0.86%

Apr. 2007

849,870$Due

0.56%–0.69%¥

45,000[45,000]

Interest rates

381,065[381,065]

Total

¥

$

7,196,805

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.
*1 indicates the total amount of short-term bonds issued by the domestic consolidated subsidiary, Mizuho Investors Securities Co., Ltd.
*2 indicates the total amount of short-term bonds issued by the domestic consolidated subsidiary, UC Card Co., Ltd.

Major components of Short-term Bonds at March 31, 2006 were as follows:
Issuer

Issue

MHFG

Jan. 2006–Mar. 2006

Millions of yen

Interest rates

894,000

0.16%–0.20%

Apr. 2006–
Jul. 2006

MHCB

Feb. 2006–Mar. 2006

203,400

0.05%–0.09%

Apr. 2006–
Jun. 2006

MHSC

Dec. 2005–Mar. 2006

258,700

0.04%–0.19%

Apr. 2006–
Nov. 2006*1

Jan. 2006–Mar. 2006

29,0000.11%–0.39%

Apr. 2006–
Sep. 2006

Total

¥

¥

1,385,100

Note: No collateral was provided for the above short-term bonds.
*1 indicates the total amount of short-term bonds issued by the domestic consolidated subsidiary, Mizuho Investors Securities Co., Ltd.

126

Due

19. Bonds and Notes
Major components of Bonds and Notes as of March 31, 2007 were as follows:
IssuerDescription

Issue

Millions of yen

MHCB

Straight Bonds

Sep. 1995–
Jan. 2007¥

738,809[6,381](US$74,000 thousand)

MHBK

Straight Bonds

Sep. 2004–
Jan. 2007

MHTB

Straight Bonds

May 2001–
Mar. 2006*1

Interest rates

Due

6,256,329[54,035]

0.74%–
5.71%

Jul. 2007 –Aug. 2014

522,500[—]

4,424,591[—]

0.80%–
2.87%

Sep. 2014 –

152,200[—]

1,288,848[—]

0.88%–
2.88%

May 2012 –Straight Bonds

Jan. 2004–
472,286
Mar. 2004[—](US$3,000,000 thousand)(EUR 750,000 thousand)

3,999,375[—]

4.75%–
8.37%

Apr. 2009 –Apr. 2014*2

Straight Bonds

Jul. 1997

10,000[—]84,681[—]

3.50%

Jul. 2012*3

Straight Bonds

Feb. 1997–
Sep. 2004

299,189[—](US$110,000 thousand)

2,533,575[—]

1.13%–
6.15%

Aug. 2010 –*4Straight Bonds

Jul. 1995–
Sep. 2006

538,640[33,576](US$1,472,709 thousand)(EUR 65,000 thousand)

4,561,267[284,333]

0.84%–
8.62%

Apr. 2007 –*5

Straight Bonds

May 1997–
Mar. 2007

503,899[24,893](US$ 78,045 thousand)(EUR 25,040 thousand)

4,267,081[210,805]

0.00%–
19.00%

Apr. 2007 –Apr. 2037¥ 3,237,525$ 27,415,747

Total

Thousands of U.S. dollars$

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amounts of foreign currencies 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, 2008 ¥ 64,865 million ($ 549,288 thousand)2009 ¥ 41,727 million ($ 353,350 thousand)2010 ¥250,573 million ($2,121,886 thousand)2011 ¥131,381 million ($1,112,556 thousand)2012 ¥697,464 million ($5,906,209 thousand)4. Bonds and Notes as of March 31, 2007 included subordinated bonds and notes of ¥2,117,302 million ($17,929,564 thousand).
5. No collateral was provided for the above Bonds and Notes.
*1 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho Financial Group (Cayman) Limited.
*2 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho TB (Aruba) A.E.C.
*3 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho Finance (Aruba) A.E.C.
*4 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Finance (Cayman) Limited and Mizuho Finance (Curaçao) N.V.
*5 indicates the total amount of straight bonds issued by the domestic consolidated subsidiary, MHSC, and the overseas consolidated subsidiary, Mizuho International plc.

127

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Major components of Bonds and Notes as of March 31, 2006 were as follows:
IssuerDescription

Issue

Millions of yen

Interest rates

Due

MHCB

Straight Bonds

Sep. 1997–
Aug. 2004¥

123,100

2.10%–
3.00%

Nov. 2012 –Aug. 2014

MHBK

Straight Bonds

Sep. 2004–
Feb. 2006

311,600

0.39%–
2.49%

Sep. 2014 –MHTBStraight Bonds

Apr. 2001–
Mar. 2006

161,500

0.38%–
2.76%

Apr. 2011 –*1

Straight Bonds

Jan. 2004–
459,472
Mar. 2004 (US$3,000,000 thousand)(EUR 750,000 thousand)

4.75%–
8.37%

Apr. 2014 –*2

Straight Bonds

Jul. 1997–
Apr. 2001

16,0001.31%–
3.50%

Apr. 2011 –Jul. 2012*3

Straight Bonds

Sep. 1996–
Sep. 2004

449,821(US$110,000 thousand)

0.29%–
5.77%

Sep. 2006 –*4

Straight Bonds

Jul. 1995–
Sep. 2005

623,056(US$760,001 thousand)(EUR 65,000 thousand)

0.42%–
8.62%

Jul. 2007 –*5

Straight Bonds

Jun. 1996–
Mar. 2006

343,948(US$75,465 thousand)(EUR25,014 thousand)

0.00%–
14.90%

Apr. 2006 –Mar. 2036

Total¥ 2,488,498

Notes: 1. The amounts of foreign currencies denominated bonds are shown in original currencies in parentheses ( ).
2. Bonds and Notes as of March 31, 2006 included subordinated bonds and notes of ¥2,143,962 million.
3. No collateral was provided for the above bonds and notes.
*1 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho Financial Group (Cayman) Limited.
*2 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho TB (Aruba) A.E.C.
*3 indicates the total amount of straight bonds issued by the overseas consolidated subsidiary, Mizuho Finance (Aruba) A.E.C.
*4 indicates the total amount of straight bonds issued by the overseas consolidated subsidiaries, Mizuho Finance (Cayman) Limited and Mizuho Finance (Curaçao) N.V.
*5 indicates the total amount of straight bonds issued by the domestic consolidated subsidiary, MHSC, and the overseas consolidated subsidiary, Mizuho International plc.

20. Other Liabilities
As of March 31,

Derivatives
Accrued Expenses
Unearned Income
Income Taxes Payable
Other
Total

128

Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 3,014,998
289,143
147,237
28,6402,290,636¥ 1,969,985
220,181
159,015
52,386
2,981,362$ 25,531,362
2,448,503
1,246,821
242,532
19,397,382¥ 5,770,656¥ 5,382,931$ 48,866,600

21. Reserve for Employee Retirement Benefits(1) MHFG and domestic consolidated subsidiaries adopt the Corporate Pension Fund Plans (“Kigyo Nenkin Kikin Seido”), the Taxqualified Pension Plans (“Tekikaku-Taishoku-Nenkin Seido”), and the Termination Allowance Plans (“Taishoku Ichijikin Seido”)
as Defined-Benefit Corporate Pension Plans. In addition, MHFG and certain domestic consolidated subsidiaries adopt DefinedContribution Pension Plans.
Certain domestic consolidated subsidiaries established employee retirement benefit trusts.
(2) Reserve for Employee Retirement Benefits was reconciled as follows:
Millions of yen
2007

As of March 31,

Projected Benefit Obligations
Plan Assets

2006

Thousands of U.S. dollars
2007¥ 1,176,329(1,592,882)¥ 1,129,260(1,849,534)

Unfunded Projected Benefit Obligations
Unrecognized Actuarial Differences(416,552)(36,822)(720,273)
174,646(3,527,414)(311,815)

Net Amounts
Prepaid Pension Cost

(453,374)
491,016(545,627)
584,244(3,839,229)
4,157,985

Reserve for Employee Retirement Benefits¥

37,641¥$

38,616$

9,961,299(13,488,713)

318,756

Notes: 1. The above Projected Benefit Obligations do not include additional retirement benefits paid to employees.
2. The above Projected Benefit Obligations include the amount measured by certain consolidated subsidiaries under the non-actuarial
method.

(3) Breakdown of Employee Retirement Benefit Expenses (Gains) was as follows:
Millions of yen
2007

For the Fiscal Years ended March 31,

Service Cost
Interest Cost
Expected Return on Plan Assets
Gains on Plan Amendment (Amortization of Prior Service Cost)
Amortization of Unrecognized Actuarial Differences
Other (such as additional retirement benefits)¥

Net Retirement Benefit Expenses
Gains on return of substitutional portion of pension fund related
to past employee services
Gains on cancellation on employee retirement benerfit trust
Net Expenses (Gains) related to Employee Retirement Benefits¥

22,76028,089(69,567)
—
821
6,798

¥

2006

Thousands of U.S. dollars
2007

21,936
27,590(50,622)(451)
44,294
23,414$

192,741
237,861(589,110)—
6,957
57,571(11,098)

66,162(93,980)—(125,961)(1,216)——(1,066,660)

64,946$ (1,160,640)(137,059)¥

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 non-actuarial method for calculating projected benefit
obligations are included in Service Cost in full.
3. Other for the fiscal year ended March 31, 2006 includes adjustment of ¥14,473 million resulting from a review of the method used to
calculate employee retirement benefits at the beginning of the fiscal year.

(4) Assumptions used in calculation of the above information were as follows:
Discount Rate
Expected Rate of Return on Plan Assets
Method of Attributing the Projected Benefits to Periods of Service
Prior Service Cost
Amortization of Unrecognized Actuarial Differences

2007
mainly 2.5%
mainly 3.7%
Straight-line basis
Charged to Income(Loss) in the year
Primarily 10-12 years

2006
mainly 2.5%
mainly 3.6%
Straight-line basis
Charged to Income(Loss) in the year
Primarily 10-12 years

129Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

22. Reserves under Special Laws
Millions of yen
2007

2006

¥

2,575
104

¥

2,268
83

$

21,808
888

¥

2,680

¥

2,352

$

22,696

As of March 31,

Reserve for Contingent Liabilities from Securities Transactions
Reserve for Contingent Liabilities from Futures Transactions
Total

Thousands of U.S. dollars
2007

23. Acceptances and Guarantees(1) All commitments and contingent liabilities of a material nature resulting from guarantees or otherwise are included in the contra-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
2007

2006

Thousands of U.S. dollars
2007¥ 4,301,411
171,052
8,087¥ 5,415,858
132,876
8,194$ 36,424,859
1,448,491
68,485¥ 4,480,551¥ 5,556,929$ 37,941,835

Notes: 1. Effective the fiscal year ended March 31, 2006, Acceptances and Guarantees, and Customers' Liabilities for Acceptances and Guarantees
include those of certain domestic banking subsidiaries against bonds held by these subsidiaries.
2. Liabilities for guarantees on corporate bonds included in Securities, which were issued by private placement (Article 2, Paragraph 3 of the
Securities and Exchange Law) amounted to ¥1,583,072 million ($13,405,647 thousand) as of March 31, 2007.
Commencing with the fiscal year ended March 31, 2007, the respective amounts of “Acceptances and Guarantees” and “Customers'
Liabilities for Acceptances and Guarantees” relating to the liabilities for guarantees are netted, excluding the amounts guaranteed by theCredit Guarantee Corporations which have already been netted, in accordance with the revision of the appendix forms of “Banking Law
Enforcement Regulations” (Ministry of Finance Ordinance No.10, 1982) by the “Cabinet Office Ordinance to Amend Part of Banking Law
Enforcement Regulations” (Cabinet Office Ordinance No.38, April 17, 2007) effective from the fiscal year which began on or after April 1,
2006.
As a result, both “Acceptances and Guarantees” and “Customers' Liabilities for Acceptances and Guarantees” decreased by ¥1,537,996
million ($13,023,938 thousand), compared with corresponding amounts under the previously applied method.

(2) The principal amounts promised to be indemnified for money trusts and loan trusts, which are entrusted to domestic consolidated trust banking subsidiaries, were ¥987,910 million ($8,365,746 thousand) and ¥172,055 million ($1,456,983 thousand)as of March 31, 2007, respectively, and ¥1,008,955 million and ¥340,605 million as of March 31, 2006, respectively.

24. Revaluation of Land
In accordance with the Land Revaluation Law (Proclamation No.34, dated March 31, 1998), land used for business operations ofdomestic consolidated banking subsidiaries was revalued on March 31, 1998. In accordance with Article 2, Item 4 of the
Enforcement Ordinance relating to the Land Revaluation Law (Government Ordinance No.119, promulgated on March 31, 1998),
the revaluation was performed by the method of calculating the value along with reasonable adjustments, such as for the condition of the land.
The applicable income taxes on the entire excess of revaluation is included in Deferred Tax Liabilities for Revaluation Reserve forLand under Liabilities, and the remainder, net of applicable income taxes, is stated as Revaluation Reserve for Land, net of Taxes
included in Net Assets (Shareholders' Equity as of March 31, 2006).
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 book value of the land after
such revaluation was ¥139,972 million ($1,185,301 thousand) and ¥186,648 million as of March 31, 2007 and 2006, respectively.

130

25. Common Stock and Preferred Stock
Common Stock and Preferred Stock at March 31, 2007 and 2006 were as follows:
Number of shares
As of March 31, 2007
Class of stock

Common Stock
Eleventh Series Class XI Preferred StockThirteenth Series Class XIII Preferred Stock

Authorized

Issued andoutstanding

Per share (Yen)InterimYear-end
cash dividend cash dividend

24,868,200 11,872,195.49
1,398,500
943,740
1,500,000
36,690

¥

—
—
—

With
Liquidation Convertible redemption
value
or notor not¥ 7,000 ¥—20,000 1,000,000
30,000 1,000,000

No
Yes
No

No
No
Yes

Notes: 1.Treasury Stock and stocks held by subsidiaries and affiliates are not excluded. The numbers are as follows:
Common Stock
265 thousand shares
2.The total number of shares of Class XII Preferred Stock, which are authorized to be issued, is 1,500,000.

Number of shares
As of March 31, 2006
Class of stock

Common Stock
Fourth Series Class IV Preferred Stock
Sixth Series Class VI Preferred Stock
Seventh Series Class VII Preferred Stock
Eleventh Series Class XI Preferred StockThirteenth Series Class XIII Preferred Stock

Authorized

Issued andoutstanding

Per share (Yen)InterimYear-end
cash dividend cash dividend

25,000,000 12,003,995.49
150,000
150,000
150,000
150,000//
1,398,500
943,740
1,500,000
36,690

¥

—
—
—
—
—
—

With
Liquidation Convertible redemption
value
or notor not¥ 4,000 ¥—47,600 2,000,000
42,000 2,000,000//
20,000 1,000,000
30,000 1,000,000

No
No
No
/
Yes
No

No
Yes
Yes
/
No
Yes

Notes: 1.Treasury Stock and stocks held by subsidiaries and affiliates are not excluded. The numbers are as follows:
Common Stock
396 thousand shares
2.The total number of shares of Class XII Preferred Stock, which are authorized to be issued, is 1,500,000.

131

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

26. Interest Income and Interest Expenses
Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 1,302,102
592,863
19,58676,527
470,335
22,84778,379¥ 1,071,892
456,749
9,981
50,844
260,132
3,819
81,628$ 11,026,359
5,020,435
165,862
648,0443,982,858
193,473
663,730

2,562,642

1,935,048

21,700,761

584,603
34,08331,937
609,642
29,08352
38,980143,994

273,085
48,208
6,402
383,156
24,274292
23,258
113,725

4,950,490
288,621
270,455
5,162,525
246,286447
330,088
1,219,363

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
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending Transactions
Commercial Paper
Borrowed Money
Other Interest Expenses
Total

1,472,378

872,40312,468,275

Net¥ 1,090,264¥ 1,062,645$ 9,232,486

27. Trading Income and Trading Expenses
Millions of yen
2007

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

110,672
155,130¥

149,487
61,542Thousands of U.S. dollars
2007$

937,184
1,313,667

265,802

211,029

2,250,851

4,258

6,088

36,062

4,258
¥

2006

6,088

36,062¥204,941$ 2,214,789

Millions of yen
2007

2006

Thousands of U.S. dollars
2007

261,544

28. Other Operating Income
For the Fiscal Years ended March 31,

Gains on Foreign Exchange Transactions
Gains on Sales of Bonds
Other
Total

132

¥

140,257
79,95850,729¥220,788
70,81862,874$ 1,187,714
677,102429,582¥

270,945¥354,481$ 2,294,398

29. Other Operating Expenses
Millions of yen
2007

For the Fiscal Years ended March 31,

Losses on Sales of Bonds
Expenses on Derivatives other than for Trading or Hedging
Losses on Devaluation of Bonds
Amortization of Debenture Issuance Costs
Other

2006

Thousands of U.S. dollars
2007¥

53,903
11,283190
252
57,807¥104,929
15,58775,866
164
57,861$¥

123,438¥

254,408$ 1,045,288

For the Fiscal Year ended March 31, 2007

Millions of yen

Thousands of U.S. dollars

Gains on sales of stock
Gains on cancellation of employee retirement benerfit trust
Recovery on written-off loans
Reversal of reserve for contingencies
Gains on disposition of fixed assets
Other

¥

231,265
125,961
77,38928,257
16,64243,300$ 1,958,380
1,066,660
655,340239,286
140,930
366,676¥

522,816$ 4,427,272

For the Fiscal Year ended March 31, 2006

Millions of yen

Thousands of U.S. dollars

Gains on sales of stockReversal of reserves for possible losses on loans
Gains on disposition of investments in subsidiaries
Gains on disposition of premises and equipment
Recovery on written-off loans
Gains on return of substitutional portion of pension fund related to past employee services
Reversal of reserve for contingent liabilities from future transactions
Other

¥

230,470
142,249
42,43722,153
5,342
1,216
0
58,343$

1,961,954
1,210,940
361,259
188,589
45,477
10,352
0496,670¥

502,212$4,275,241

Total

456,464
95,552
1,612
2,141
489,519

30. Other Income

Total

Total

133

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

31. Other Expenses
For the Fiscal Year ended March 31, 2007

Millions of yen

Losses on devaluation of stocks
Provision for reserves for possible losses on loans
Write-offs of loans
Losses on disposition of fixed assets
Losses on impairment of fixed assets
Provision for reserve for contingent liabilities from securities transactions
Provision for reserve for contingent liabilities from futures transactions
Other

¥

335,790
69,775
67,141
17,0714,281
307
21
79,324$

2,843,513
590,870
568,563
144,562
36,2592,608
181
671,727¥

573,714$4,858,283

Total

For the Fiscal Year ended March 31, 2006

Losses on sales of bonds related to Japanese Government Bonds etc.,
resulting from revisions of the bond portfolio strategies
Loss resulting from the placement of an erroneous order by a certain domestic securities subsidiary
Write-offs of loans
Provision for reserve for contingencies
Losses on devaluation of stocks
Losses on impairment of fixed assets
Loss on a decline in the value in use of software used at domestic trust
banking subsidiaries as a result of revising system strategies (Note)
Losses on disposition of premises and equipment
Adjustment resulting from a review of the method used to calculate
employee retirement benefits at the beginning of the fiscal year
Provision for reserve for contingent liabilities from securities transactions
Other
Total

Millions of yen¥¥

85,305

Thousands of U.S. dollars

Thousands of U.S. dollars$

726,187

40,73937,18735,45929,93622,360346,812316,574
301,861
254,841
190,352

18,996

161,712

18,429156,889

14,473

123,209543
125,833

4,625
1,071,197

429,265$3,654,259

Note: The losses of domestic trust banking subsidiaries were incurred from an appropriate reduction in the amount of software assets booked onreconsideration of possible significant declines in their value in use arising from a shorter-than-estimated useful life. The reduction was madefor long-term use software relevant to the operating of the domestic trust banking subsidiaries, in the process of revision and reorganizationof system development and operating systems among consolidated group companies aiming to ensure mobility in system strategies,
reflecting a faster trend in the timing of abolition and replacement than originally planned at initial development because of noticeablechanges in the operating environment, system technology and system usage environment in the current trust banking sector.

13432. Losses on Impairment of Fixed Assets
The differences between the recoverable amount and the book value of the following assets were recognized as Losses on
Impairment of Fixed Assets:
For the Fiscal Year ended March 31, 2007
Area
Principal purpose of use

Tokyo
Metropolitan Area

Branch premises to be closed
Idle assets

3 branches
32 items

Other

Branch premises to be closed
Idle assets

1 branch
61 items

For the Fiscal Year ended March 31, 2006
Area
Principal purpose of use

Tokyo
Metropolitan Area

Branch premises to be closed
Idle assets
Assets to be disposed of

12 branches
85 items

Other

Branch premises to be closed
Idle assets
Assets to be disposed of

9 branches
105 items

Type

Millions of yen

Land, Buildings
and premises, etc.

¥

Land, Buildings
and premises, etc.

1,299

Thousands of U.S. dollars$

11,0082,981

25,251

Type

Millions of yen

Thousands of U.S. dollars

Land, Buildings
and premises, etc.

¥

Land, Buildings
and premises, etc.

11,387

10,973$96,93993,413

Note: Domestic consolidated banking subsidiaries, a certain domestic consolidated trust banking subsidiary and certain domestic consolidated
subsidiaries recognize Losses on Impairment of Fixed Assets for branch premises to be closed, branch premises and idle assets for the fiscal
year ended March 31, 2007, and for branch premises to be closed, idle assets and assets to be disposed of for the fiscal year ended March
31, 2006. For the purposes of identifying impaired assets in such cases, the individual asset is assessed as a unit. The recoverable amount iscalculated based on net realizable value. Net realizable value is calculated based on the valuation by road rating with reasonable adjustments
to compensate for sites with long depth and other factors, the appraisal value and others, less estimated cost of disposition.

33. Cash Flows
Cash and Cash Equivalents on the consolidated statements of cash flows reconciles to Cash and Due from Banks on the consolidated balance sheets 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
2007

2006

Thousands of U.S. dollars
2007¥ 3,993,362(904,331)¥ 5,016,216(1,628,286)$ 33,816,262(7,657,988)¥ 3,089,030¥ 3,387,929$ 26,158,274

135

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

34. Lease Transactions
Finance Leases (Lessees)
The Acquisition Cost Equivalents, Accumulated Depreciation Equivalents, Accumulated Impairment Loss Equivalents and Book
Value Equivalents relating to finance lease transactions accounted for as operating leases were summarized as follows:
Millions of yen

As of March 31,

Equipment

2007
Others

Total

Equipment

2006
OthersAcquisition Cost Equivalents
Accumulated Depreciation Equivalents
Accumulated Impairment Loss Equivalents¥

47,222
31,14124¥

2,609 ¥
2,026—

49,831
33,16824¥

51,953(33,329)—¥

Book Value Equivalents¥

16,056¥582 ¥

16,638¥18,624¥

Total

2,697 ¥ 54,650(1,949)(35,278)——
747 ¥

19,371Thousands of U.S. dollars

As of March 31,

Equipment

2007
Others

Total

Acquisition Cost Equivalents
Accumulated Depreciation Equivalents
Accumulated Impairment Loss Equivalents$ 399,884
263,712207$ 22,095 $ 421,979
17,162
280,874—207

Book Value Equivalents$ 135,965$

4,933 $ 140,898

Future lease payments subsequent to the end of the fiscal year for finance leases transactions accounted for as operating leases(including the interest portion thereon) were summarized as follows:
Millions of yen
2007

As of March 31,

Due in One Year or Less
Due after One Year
Total

2006

Thousands of U.S. dollars
2007

¥

8,804
18,466¥

9,166
20,933$74,561
156,374¥

27,271¥

30,100$ 230,935

Impairment Loss Equivalent Account, Lease Expense, Reversal of Impairment Loss Equivalent Account, Depreciation Equivalents,
Interest Expense Equivalents and Impairment Losses relating to finance leases transactions accounted for as operating leases weresummarized as follows:
Millions of yen
2007

As of March 31,

Impairment Loss Equivalent AccountLease Expense
Reversal of Impairment Loss Equivalent AccountDepreciation Equivalents
Interest Expense Equivalents
Impairment Losses¥

24
10,701—
10,006
876
24

2006

¥

—
11,507—
11,482
989—

Thousands of U.S. dollars
2007

$

207
90,625—84,7397,426
207

Notes: 1. The method for computing the amount of depreciation equivalents is as follows:
Depreciation equivalents are calculated by the declining-balance method, computed by multiplying the amounts by 10/9, which itself iscomputed assuming that the useful life is the lease term and that the residual value at the end of the lease term is 10% of the acquisitioncost.
2. The method for computing the amount of interest expenses equivalents is as follows:
The amounts are defined as the difference between total lease payments and acquisition cost equivalents, which are allocated over thelease term by the interest method.

136

Operating Leases
The future lease payments subsequent to the end of the fiscal year for operating lease transactions were summarized as follows:
Lessees:Millions of yen
2007

As of March 31,

Due in One Year or Less
Due after One Year
Total

¥

39,288
151,670¥ 190,959

2006¥

34,465
148,193

Thousands of U.S. dollars
2007$

332,701
1,284,363¥ 182,659$ 1,617,064

2006

Thousands of U.S. dollars
2007

Lessors:
Millions of yen
2007

As of March 31,

Due in One Year or Less
Due after One Year
Total

¥

1,070
5,319

¥

1,297
6,144

$

9,069
45,043

¥

6,390

¥

7,441

$

54,112137

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

35. Deferred Tax Assets and Liabilities
Deferred Tax Assets and Liabilities consisted of the following:
Millions of yen
2007

2006

Thousands of U.S. dollars
2007¥ 1,543,353
432,648
387,648
185,110
335,478¥ 1,823,707
343,742
402,547
222,352
328,244$ 13,069,300
3,663,718
3,282,652
1,567,536
2,840,871

2,884,239(1,521,873)

3,120,593(1,652,098)

24,424,077(12,887,401)¥ 1,362,366¥ 1,468,495$ 11,536,676¥¥(219,091)(872,696)(80,982)$ (1,509,088)(7,081,278)(1,499,953)¥ (1,191,565)¥ (1,172,770)$ (10,090,319)¥¥

295,724$

Millions of yen
2007

2006

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:
Prepaid Pension Cost
Net Unrealized Gains on Other Securities
Other
Total
Net Deferred Tax Assets(178,208)(836,228)(177,129)
170,800

1,446,357

Balances reported on the Consolidated Balance Sheets:
As of March 31,

Thousands of U.S. dollars
2007

Deferred Tax Assets
Deferred Tax Liabilities¥

389,024(218,224)¥

423,572(127,847)$

3,294,304(1,847,947)

Net Deferred Tax Assets¥

170,800¥

295,724$

1,446,357

Notes: 1. In addition to the balances shown in the above table, there is an equivalent amount of deferred tax assets corresponding to tax losses
carried forward of ¥1,133,637 million ($9,599,773 thousand). Since the tax losses carried forward resulted from transactions among
consolidated subsidiaries, the deferred tax assets in the above table and in the balance sheet exclude the equivalent amount of deferred
tax assets.
2. MHFG and domestic subsidiaries are subject to a number of different income taxes.

For the Fiscal Years ended March 31, 2007 and 2006, 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, 2007

Statutory tax rate
Adjustments
Change in valuation allowance
Permanent differences (e.g. cash dividends received)
Other

40.69)%(11.62)(3.52)
1.84

Effective income tax rate

27.38)%For the Fiscal Year ended March 31, 2006

138

Statutory tax rate
Adjustments
Reversal of temporary differences related to investments in financial subsidiaries for corporate revitalization due to mergers
Change in valuation allowance
Permanent differences (e.g. cash dividends received)
Other

40.69)%
70.91(74.38)(12.18)0.37

Effective income tax rate

25.41)%

36. Segment Information(1) Segment Information by Type of Business
Segment information by type of business at March 31, 2007 and 2006 and for the fiscal years ended March 31, 2007 and 2006
was as follows:
Millions of yen

2007
Type of Business

Ordinary Income Inter-segmentfrom Outside
Ordinary
Customers
IncomeOrdinary
IncomeOrdinary
Expenses

Ordinary
Profits

Banking Business ¥ 3,236,020 ¥ 33,728 ¥ 3,269,748 ¥ 2,672,194 ¥ 597,554
Securities Business
688,225
77,954
766,180646,254
119,925
Other
175,408
125,328
300,736
263,359
37,377
Total
Elimination

4,099,654—

Consolidated
Results¥ 4,099,654 ¥

237,011(237,011)

4,336,666(237,011)

3,581,808(230,323)

754,857(6,687)— ¥ 4,099,654 ¥ 3,351,484 ¥ 748,170

Losses on
Depreciation Impairment of
Total Assets
Expense Fixed Assets¥ 129,910,635 ¥ 115,394 ¥
22,232,798
9,037
1,272,374
7,796
153,415,808(3,535,777)

132,228—¥ 149,880,031 ¥ 132,228 ¥CapitalExpenditure

4,070 ¥ 158,439—
13,459211
11,045
4,281—

182,944—

4,281 ¥ 182,944
Millions of yen

2006
Type of Business

Ordinary Income Inter-segmentfrom Outside
Ordinary
Customers
IncomeOrdinary
IncomeOrdinary
Expenses

Ordinary
Profits

Banking Business ¥ 2,813,124 ¥ 24,379 ¥ 2,837,503 ¥ 2,121,573 ¥ 715,930
Securities Business
558,830
48,741
607,572
438,404
169,167
Other
185,594
115,480
301,075
258,50242,572
Total
Elimination

3,557,549—

Consolidated
Results¥ 3,557,549 ¥

188,600(188,600)

3,746,150(188,600)

2,818,479(181,999)

927,670(6,601)— ¥ 3,557,549 ¥ 2,636,480 ¥ 921,069

Losses on
Depreciation Impairment of
Total Assets
Expense Fixed Assets¥ 132,767,641 ¥
19,998,986
1,160,564
153,927,192(4,314,398)

CapitalExpenditure

99,927 ¥ 21,725 ¥ 154,988
9,134
390
11,302
10,355244
13,479119,417—

22,360—179,770—¥ 149,612,794 ¥ 119,417 ¥ 22,360 ¥ 179,770
Thousands of U.S. dollars

2007Type of Business

Ordinary Income Inter-segmentfrom Outside
Ordinary
Customers
IncomeOrdinary
IncomeOrdinary
Expenses

Ordinary
Profits

Losses on
Depreciation Impairment of
Total Assets
Expense Fixed Assets

CapitalExpenditure

Banking Business $27,403,000 $ 285,619 $27,688,619 $22,628,458 $5,060,161
Securities Business 5,827,978
660,128 6,488,106 5,472,563 1,015,543
Other
1,485,381 1,061,293 2,546,674 2,230,156
316,518$1,100,098,530 $ 977,174 $ 34,467 $1,341,683
188,269,954
76,527—
113,980
10,774,617
66,024
1,792
93,531

Total
Elimination

1,299,143,101 1,119,725(29,941,377)—

34,716,359 2,007,040 36,723,399 30,331,177 6,392,222— (2,007,040) (2,007,040) (1,950,410)(56,630)

Consolidated
Results$34,716,359 $— $34,716,359 $28,380,767 $6,335,592

36,259 1,549,194——$1,269,201,724 $1,119,725 $ 36,259 $1,549,194

Notes: 1. Ordinary Income represents Total Income less certain special income, and Ordinary Expenses represent Total Expenses less certain special
expenses.
2. Ordinary Profits represent Ordinary Income less Ordinary Expenses.
3. Major components of type of business are as follows:(1) Banking Business; banking and trust banking business(2) Securities Business; securities business(3) Other; investment advisory business and other
4. Until the fiscal year ended March 31, 2006, MHFG and certain domestic consolidated subsidiaries recognized director and corporate
auditor retirement benefits as expenses at the time of payment. However, in accordance with the public announcement of the“Accounting Standard for Directors' Bonus” (ASBJ Statement No.4, November 29, 2005) and the “Auditing Treatment relating to Reserve
defined under the Special Tax Measurement Law, Reserve defined under the Special Law and Reserve for Director and Corporate Auditor
Retirement Benefits” (JICPA Auditing and Assurance Practice Committee Report No.42, April 13, 2007), these benefits are recorded as
Reserve for Director and Corporate Auditor Retirement Benefits at the required amount as of March 31, 2007, based on internallyestablished standards. As a result, Ordinary Expenses increased by ¥5,144 million ($43,563 thousand), ¥506 million ($4,293 thousand)and ¥137 million ($1,165 thousand) for Banking Business, Securities Business and Other, respectively, and Ordinary Profits decreased by
the same amounts for respective business, compared with the corresponding amounts under the previously applied method.

139

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(2) Segment Information by Geographic Area
Segment information by geographic area at March 31, 2007 and 2006 and for the fiscal years ended March 31, 2007 and 2006
was as follows:
Millions of yen

2007
Geographic Area

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeJapan
Americas
EuropeAsia / Oceania excluding Japan¥ 2,822,824
614,136445,162
217,530¥

Total
Elimination
Consolidated Results

4,099,654—

Ordinary
IncomeOrdinary
Expenses

Ordinary
Profits

Total Assets

33,941
166,460
51,2294,495¥ 2,856,765
780,597496,392
222,026¥ 2,276,141 ¥
700,757
441,505
183,878

580,623
79,84054,88638,148¥ 130,400,488
17,968,153
13,415,749
7,217,744

256,126(256,126)

4,355,781(256,126)

3,602,283(250,798)

753,498(5,328)169,002,136(19,122,104)—¥ 4,099,654¥ 3,351,484 ¥

748,170¥ 149,880,031¥ 4,099,654¥

2006
Geographic Area

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeJapan
Americas
EuropeAsia / Oceania excluding Japan¥ 2,724,307
413,195
314,021106,025¥

Millions of yen

Total
Elimination
Consolidated Results

3,557,549—

Ordinary
IncomeOrdinary
Expenses

Ordinary
Profits

Total Assets

52,129118,943
59,18340,604¥ 2,776,437
532,139373,205
146,629¥ 2,014,512 ¥
451,753
293,742
113,076

761,925
80,38579,46233,552¥ 134,979,559
13,610,516
10,587,137
5,790,487

270,861(270,861)

3,828,411(270,861)

2,873,084(236,603)

955,326(34,257)

164,967,701(15,354,907)—¥ 3,557,549¥ 2,636,480 ¥

921,069¥ 149,612,794¥ 3,557,549¥

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeOrdinary
IncomeJapan
Americas
EuropeAsia / Oceania excluding Japan$ 23,904,009
5,200,584
3,769,688
1,842,078$ 287,417
1,409,608
433,820
38,067

Total
Elimination

34,716,359—$ 34,716,359

Thousands of U.S. dollars

2007
Geographic Area

Consolidated Results

Ordinary
Profits

Total Assets$ 24,191,426
6,610,192
4,203,508
1,880,145$ 19,274,637 $ 4,916,789
5,934,094
676,098
3,738,725
464,783
1,557,103
323,042$ 1,104,246,665
152,156,433
113,606,146
61,120,709

2,168,912(2,168,912)

36,885,271(2,168,912)

30,504,559(2,123,792)

6,380,712(45,120)

1,431,129,953(161,928,229)$$ 34,716,359$ 28,380,767 $ 6,335,592$ 1,269,201,724—

Ordinary
Expenses

Notes: 1. Ordinary Income represents Total Income less certain special income, and Ordinary Expenses represent Total Expenses less certain special
expenses.
2. Ordinary Profits represent Ordinary Income less Ordinary Expenses.
3. Geographic analyses are presented based on geographic contiguity, similarities in economic activities, and relation of business operations.
4. Americas includes the United States of America and Canada. Europe includes the United Kingdom. Asia / Oceania includes Hong Kong andthe Republic of Singapore.

(3) Ordinary Income from Overseas Entities
Ordinary Income from Overseas Entities for the fiscal years ended March 31, 2007 and 2006 consisted of the following:
Millions of yen
2007

For the Fiscal Years ended March 31,

Ordinary Income of Overseas Entities
Total Ordinary Income
Ordinary Income of Overseas Entities' Ratio¥

1,276,830
4,099,654
31.1%

¥

2006

Thousands of U.S. dollars
2007

833,2423,557,549$ 10,812,350
34,716,359

23.4%

/

Notes: 1. Ordinary Income of overseas entities represents Ordinary Income recorded by overseas branches of MHCB and other overseas subsidiaries
excluding Inter-segment Ordinary Income.
2. Segment information on Ordinary Income from overseas entities is not presented as no such information is compiled.

14037. Subsequent Events(i) The Board of Directors of MHFG resolved on April 20, 2007 to redeem preferred securities issued by MHFG's overseas special
purpose subsidiaries, as described below.
(a) Issuer• Mizuho Preferred Capital (Cayman) 1 Limited• Mizuho Preferred Capital (Cayman) 2 Limited(b) Type of security
Non-cumulative Perpetual Preferred Securities(c) Aggregate redemption amount• Series B: ¥112,500 million ($952,663 thousand)• Series A: ¥ 73,000 million ($618,173 thousand)(d) Scheduled redemption dateJune 29, 2007(e) Reason for the redemption
Arrival of optional redemption date(ii) MHFG, at the meeting of the Board of Directors held on May 22, 2007, resolved to repurchase and cancel MHFG's common
stock held by Mizuho Financial Strategy Co., Ltd., MHFG's subsidiary, and the repurchase and cancellation were completed as
described in detail below. This repurchase was made for the purpose of retiring all MHFG's shares (261,040.83 shares), which
the subsidiary stated above acquired and held at that time in the course of the Business Reorganization in March 2003.
(a) Aggregate number of shares to be repurchased:
261,040 shares(b) Repurchase price:¥847,000 per share(c) Aggregate amount of repurchase:¥221,100,880,000(d) Aggregate number of shares to be cancelled:
261,040 shares (Cancellation of own shares pursuant to Article 178 of the Company Law)(e) Date of repurchase and cancellation:
May 28, 2007(f) Method of repurchase:
Direct purchase
The repurchase and cancellation has no effect on Net Assets although the sum of Capital Surplus and Retained Earnings
decreased by ¥30,235,629,506 since Treasury Stock also decreased by the same amount.
MHFG repurchased and cancelled the fractional shares of common stock (0.83 shares) based on MHFG's Share Handling
Regulations. By doing so, MHFG completed the repurchase and cancellation of all MHFG's common stock held by the subsidiary stated above.
(iii) MHFG, at the meeting of the Board of Directors held on May 22, 2007, set up a limit for repurchasing MHFG's common stock
up to the maximum amount of ¥150.0 billion as described below. This repurchase will be made for the purpose of offsetting
the potential dilutive effect due to the commencement of the conversion period for the Eleventh Series Class XI Preferred Stockfrom July 1, 2008.
Details of Repurchase(a) Type of shares to be repurchased:
Shares of common stock of Mizuho Financial Group, Inc.
(b) Aggregate number of shares to be repurchased:
Up to a maximum of 250,000 shares(c) Aggregate amount of repurchase:
Up to a maximum of ¥150.0 billion(d) Period of repurchase:
From June 1, 2007 to November 30, 2007(e) Method of repurchase:
Market transactions and others

141

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

38. Fair Value of Securities and Money Held in Trust
The following tables contain information relating to “Securities,” Trading Securities 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, 2007

Bonds Held-to-Maturity:
Japanese Government Bonds
Japanese Local Government Bonds
Other
Other Securities*2:
Japanese Stocks*3
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Money Held in Trust
Other Money Held in Trust

Gross unrealized
Gains

Acquisition cost¥

1,337,447
969,020
49,980318,445
28,289,657
3,317,061
15,554,634
14,673,319
85,441
6,906
788,966
9,417,961

¥

686

0
0
—
—
2,803,332*4
2,741,841
3,953
2,026
499
—
1,427
57,536¥—

Losses

8,064
1,829
183
6,051
362,210*4
48,058161,412
154,340
1,154
0
5,917
152,740

Fair value¥—

1,329,383
967,192
49,797
312,394
30,730,779
6,010,844
15,397,175
14,521,005
84,787
6,905
784,477
9,322,758
686
Millions of yen

As of March 31, 2006

Bonds Held-to-Maturity:
Japanese Government Bonds
Japanese Local Government Bonds
Other
Other Securities*2:
Japanese Stocks*3
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Money Held in Trust
Other Money Held in Trust

142

Gross unrealized
Gains

Acquisition cost¥

1,536,148
1,168,205
51,435316,508
30,285,281
2,991,184
20,369,983
19,546,824
120,980
5,383
696,795
6,924,113
584

¥

96
96
—
—
2,575,989*4
2,492,771
1,166
280
479
0
406
82,050—¥Losses

15,767
4,510
354
10,902426,256*4
30,391
261,790
250,683
2,494
0
8,613
134,074—

Fair value¥

1,520,477
1,163,791
51,081
305,605
32,435,013
5,453,564
20,109,359
19,296,422
118,965
5,383
688,5886,872,089
584

Thousands of U.S. dollars

As of March 31, 2007

Bonds Held-to-Maturity:
Japanese Government Bonds
Japanese Local Government Bonds
Other
Other Securities*2:
Japanese Stocks*3
Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Money Held in Trust
Other Money Held in Trust

Gross unrealized
Gains

Acquisition cost$

11,325,659
8,205,781
423,240
2,696,638
239,560,149
28,089,265
131,718,475
124,255,398
723,530
58,483
6,681,064
79,752,409

$

6
6
—
—
23,738,945*4
23,218,239
33,48017,1584,233—
12,089487,226

5,809$

Losses

68,28815,491
1,550
51,247
3,067,244*4
406,963
1,366,860
1,306,976
9,774
4
50,106
1,293,421—

Fair value$—

11,257,377
8,190,296
421,6902,645,391
260,231,850
50,900,541
130,385,095
122,965,580
717,989
58,4796,643,047
78,946,214
5,809*1 A summary of Trading Securities and Money Held in Trust for investment purposes and related unrealized gains and losses are as follows:

As of March 31,

Fair value

Trading Securities¥ 8,628,467
Money Held in Trust for Investment Purposes
48,872Millions of yen
2007
Unrealized
gains (losses)
Fair value¥ 5,200
12¥ 7,988,427
49,3132006
Unrealized
gains (losses)¥ (33,323)
310

Thousands of U.S. dollars
2007
Unrealized
Fair value
gains (losses)$ 73,066,880
413,858$ 44,039
105*2 In addition to the balances shown in the above table, Other Securities included securities which do not have readily determinable fair values such as follows:
As of March 31, 2007
Beneficial certificate of loan trust and other¥2,161,377 million ($18,302,802 thousand)Non-publicly offered bonds¥2,231,551 million ($18,897,038 thousand)Unlisted foreign securities¥1,264,857 million ($10,710,965 thousand)Other¥ 475,292 million ($ 4,024,831 thousand)As of March 31, 2006
Unlisted stock¥ 807,804 million
Non-publicly offered bonds¥2,018,703 million*3 Fair value of Japanese Stocks with a quoted market price is determined based on the average quoted market prices over the month preceding the consolidated balance sheet date.
*4 Unrealized Gains (Losses) include ¥3,935 million ($33,324 thousand) and ¥(51,680) million, which were recognized in the statements of income for the fiscal years ended March 31, 2007 and 2006,
respectively, by applying the fair-value hedge method.

143

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Projected Redemption Amounts for Bonds Held to Maturity and Other Securities with Maturity
Millions of yen

As of March 31, 2007

Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Total

Within 1 year

1–5 years

5–10 years

Over 10 years¥

6,648,544
6,244,060
4,078
6,905
393,499
1,180,743¥

7,704,173
5,782,659
89,878—
1,831,635
4,208,060¥

2,501,038
2,050,467
36,960—413,6102,911,237¥

1,801,778
1,412,838
8,290—
380,649
3,838,161¥

7,829,288¥ 11,912,234¥

5,412,275¥

5,639,940

Within 1 year

1–5 years

Millions of yen

As of March 31, 2006

Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Total

5–10 years

Over 10 years¥ 10,842,092
10,538,741
3,575
5,383
294,391
631,850¥

7,796,580
5,924,665
95,301—
1,776,613
3,134,752¥

3,182,434
2,727,372
68,364—
386,697
1,429,072¥

1,526,595
1,273,847
8,781—
243,966
3,055,132¥ 11,473,942¥ 10,931,332¥

4,611,507¥

4,581,728

Within 1 year

1–5 years

5–10 years

Over 10 years$ 56,300,656
52,875,437
34,54158,4793,332,199
9,998,679$ 65,239,850
48,968,242
761,103—
15,510,505
35,634,353$ 21,179,091
17,363,599
312,986—
3,502,506
24,652,698$ 15,257,676
11,964,082
70,206—
3,223,388
32,502,003$ 66,299,335$100,874,203$ 45,831,789$ 47,759,679

Thousands of U.S. dollars

As of March 31, 2007

Japanese Bonds:
Japanese Government Bonds
Japanese Local Government Bonds
Japanese Short-term Bonds
Japanese Corporate Bonds
Other
Total

144

Other Securities Sold during the Fiscal Year
Millions of yen

Proceeds
from sales

For the Fiscal Years ended March 31,

Other Securities

2007
Total amountof gains
on sales¥ 34,125,456 ¥Total amountof losses
on sales

311,223 ¥48,873

Proceeds
from sales

2006
Total amountof gains
on sales¥ 30,689,458 ¥

291,439

Total amountof losses
on sales¥ 176,343

Thousands of U.S. dollars

Proceeds
from sales

For the Fiscal Year ended March 31,

Other Securities

2007
Total amountof gains
on salesTotal amountof losses
on sales$288,978,380 $ 2,635,481 $ 413,866

Net Unrealized Gains on Other Securities
Net Unrealized Gains on Other Securities as of March 31, 2007 and 2006 are as follows:
2006

Thousands of U.S. dollars
2007¥ 2,437,367
2,437,367—¥ 2,201,971
2,201,971—$ 20,639,916
20,639,916—

Deferred Tax Assets
Deferred Tax Liabilities
Difference between acquisition cost and fair value, net of Taxes

343
836,571
1,601,139

509
873,225
1,329,255

2,906
7,084,184
13,558,638

Amount corresponding to Minority Interests
Amount corresponding to Net Unrealized Gains on Other Securities
owned by affiliated companies, which corresponds to theshareholdings of their investor companies
Net Unrealized Gains on Other Securities, net of Taxes

56,61855,608479,451

6,107

5,570

51,718¥ 1,550,628¥ 1,279,216$ 13,130,905

As of March 31,

Difference between acquisition cost and fair value
Other Securities
Other Money Held in Trust

Millions of yen
2007

Note: Difference between acquisition cost and fair value excludes ¥3,935 million ($33,324 thousand) and ¥(51,680) million, which wererecognized in the statements of income for the fiscal years ended March 31, 2007 and 2006, respectively, by applying the fair-value
hedge method, and includes translation differences regarding securities which do not have readily determinable fair value.

145

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

39. Derivatives Information(1) Risk Control for Derivatives(a) Details of Derivative Financial Products
The Group transacts primarily in the following derivative financial products:(i) Interest rate-related products
Swaps, interest rate guarantees (FRA options), futures, futures options, and options(ii) Currency-related products
Futures, futures options, options, swaps, and forward trading(iii) Stock-related products
Index futures, index futures options, and over-the-counter options(iv) Bond-related products
Futures, futures options, and over-the-counter options(v) Other products
Credit derivatives, commodity derivatives, weather derivatives, etc.
(b) Purposes of Using Derivative Financial Products
The Group uses derivative financial products in response to the diverse needs of customers, to control the risk related to theassets and liabilities of the Group, as part of its asset and liability management (“ALM”), and for trading purposes.
To control the risk related to assets and liabilities, the Group primarily utilizes portfolio-hedges, grouping numerous financial
assets and liabilities, such as loans and deposits with similar interest risk in accordance with risk management policies, using interest rate swaps, etc., as hedging methods for cash-flow hedge or fair value hedge. The Group applies hedge accounting to themajority of these products, treating them as deferred hedges. The effectiveness of the hedges is assessed by periodically checking,by regression analysis and other methods, whether the derivative financial products highly reduce the exposure to changes in fairvalue and variable cash flows from hedged items.
(c) Trading Guidelines
In accordance with the purposes for which the Group uses derivative financial products, the Group deals in derivative financial
products based on the following guidelines:(i) Responding to customer needs
After obtaining an adequate understanding of customer requirements, the Group follows a common policy on selling financial
products by recommending the most appropriate financial vehicle for each customer's knowledge, experience and asset position. When actually making a sale, the Group endeavors to give full explanations to its customers to ensure that they clearly
understand the nature of each product, the risks involved and other important matters.
(ii) Risk control of assets and liabilities of MHFG (ALM)
MHFG's ALM & Market Risk Committee meets periodically to confirm or revise the trading guidelines for the purposes of
securing stable income while appropriately controlling risk.
(iii) Trading activities
The Group engages in trading activities to maximize income under reasonable risk limits and strict management.
(d) Details of Trading-Related Risk
The following are the main risks inherent in derivatives trading.
(i) Credit risk:
The risk of incurring a loss because the counter-parties are unable to fulfill their obligations due to bankruptcy or otherreasons.
(ii) Market risk:
The risk of incurring a loss because the value of the derivative products decreases due to fluctuations in market risk factors
such as interest rates, foreign exchange rates and bond and stock prices.
(iii) Market liquidity risk:
The risk of incurring a loss from the inability to execute transactions in the market and/or execution at unfavorable prices due
to illiquidity of the products.
(iv) Other risk:
The risk of incurring increased costs from the additional collateral because of downgrades in MHFG's, the banking subsidiaries' and others' credit rating.

146

(e) Derivative Trading Risk Control Structure(i) Credit risk management structure
The Board of Directors determines important items concerning credit risk in accordance with the Basic Policy for Credit Risk
Management. MHFG has established the Portfolio Management Committee as one of its business policy committees. This
committee conducts overall deliberation on and adjustment of the group's credit portfolio management procedures. Under
the authority of the Chief Risk Officer, the Risk Management Department and the Credit Risk Management Department
jointly formulate and implement plans for basic matters related to credit risk management. The Group applies the same manner of credit risk management to derivative transactions as it applies to the other credit transactions.
The amount of credit risk on derivatives trading (credit risk equivalent) calculated into the capital adequacy ratio (BIS standard) was ¥4,038,161 million on March 31, 2006.
(ii) Market risk management structure
The Basic Policies for Market and Liquidity Risk Management are determined by the Board of Directors. MHFG's Risk Management Department is responsible for monitoring market risk, reports and analyses, proposals, setting limits, and for formulating
and implementing plans relating to market risk management as a specialized risk management section.
The Group has established a solid management structure for market risk including comprehensive management (ALM) ofinterest rate risk and other types of risk. Through this structure, it comprehensively ascertains and manages risk, while managing assets to secure stable income and appropriately controlling risk.
MHFG has established the ALM & Market Risk Committee as one of the business policy committees charged with conducting overall deliberation on and adjustment of market risk management procedures. The committee decides the entire group's
monthly funding and investment policies, discusses and coordinates matters relating to ALM policies, risk planning and market
risk management, and responds to emergencies such as sudden market changes.
In regard to reporting, the Risk Management Department receives the relevant data from the five core subsidiaries, as well
as reports on risk profiles and compliance with risk limits, both on a regular basis and as considered necessary. Based on thesereports, MHFG obtains a solid grasp of the market risk management situation. Reports on the status of market risk and compliance with risk limits are submitted to the President on a daily basis, and to the Board of Directors and the Executive
Management Committee on a regular basis and as considered necessary.
Value at Risk

Value at Risk (VAR) related to MHFG's trading activities for the fiscal year ended March 31, 2006 is as follows:(a) The standards used for calculating VAR• Confidence interval: one-tailed 99.0% (two-tailed 98%)
• Holding period: 1 day• Historical observation period: 1 year (265 business days, 264 return)(b) VAR results during the period covered• Maximum: ¥5.5 billion• Average: ¥3.2 billion
The period covered is from April 1, 2005 to March 31, 2006.
Notes: 1. Value at Risk (VAR) is a method of measuring market risk. It is defined as the maximum possible loss that could be incurred on the portfolio as a result of market movements within a certain
period (holding period) and degree of probability (confidence interval). The actual amount of the VAR may vary according to the length of the holding periods and the confidence interval,
as well as the models used for measuring the volatility of market risk factors.
2. The data related to the common stock position held between December 8, 2005 and December 12, 2005 as a result of an erroneous order with the Tokyo Stock Exchange made by Mizuho
Securities on December 8, 2005 is not included in the VAR shown above.

Credit Risk Equivalent Amounts

Credit risk equivalent amounts as of March 31, 2006 consisted of the following:
As of March 31, 2006

Interest Rate Swaps
Currency Swaps
Foreign Exchange Forward Transactions
Interest Rate Options (Bought)
Currency Options (Bought)
Other Financial Derivative Products
Effect of Reduction in the Credit Risk Equivalent Amount due toLump-sum Settlement Netting Contracts
Total

Millions of yen¥

8,209,262
951,372
831,380
229,937
825,526
428,122(7,437,441)¥

4,038,161

Note: The above credit risk equivalent amounts are based on the consolidated capital adequacy ratio (BIS standard).

147

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(2) Fair Value of Derivatives
The fair value of derivatives as of March 31, 2007 and 2006 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.
(ii) Fair values of listed contracts are based on the closing prices of the Tokyo Stock Exchange, the Tokyo International Financial
Futures Exchange, the New York Mercantile Exchange and others. Fair values of over-the-counter contracts are based on the
discounted value of future cash flows, option pricing models and others.
(a) Interest Rate-Related Transactions
Millions of yen

Contract value
Total
Over one year

As of March 31, 2007

Listed:Futures:
Sold
BoughtOptions:
Sold
Bought¥Over-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtTotal

41,594,787
35,055,345¥

12,154,102
8,103,374

Unrealized
gains (losses)

Fair value

¥

4,000
(4,897)¥4,000(4,897)

65,776,981
75,845,945

3,095,374
7,207,495(20,194)
16,915

3,456
2,014

14,159,665
11,447,054

201,828
251,828(1,800)2,007(1,800)
2,007

496,543,289
502,046,228
30,005,692
193,518

323,972,575
319,514,883
19,963,526
180,375(169,559)(19,342)
6,150
3,016

(169,559)(19,342)
6,150
3,016

34,304,976
25,907,713

16,619,950
14,295,512(122,153)
126,719(122,153)
126,719

/

/

/

¥

(170,387)
Millions of yen

Contract value
Total
Over one year

As of March 31, 2006

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
Bought
Total

148

¥

54,455,891
47,856,720¥

13,646,039
12,236,367

Unrealized
gains (losses)

Fair value¥

260,381(259,140)¥

260,381(259,140)

24,989,164
25,033,118

1,118,453
960,151(14,886)
12,602

4,656
2,055

14,971,097
14,151,083

79,98031,510

(637)
933

(637)
933

405,772,439
390,770,702
30,634,398
212,105

273,245,016
265,487,227
18,634,794
145,843

1,208,652(1,240,360)
3,918
1,805

1,208,652(1,240,360)
3,918
1,805

12,288,919
13,660,289

7,734,504
7,399,554(97,928)
103,276(97,928)
103,276

/

/

/

¥

(12,387)

Thousands of U.S. dollars

Contract value
Total
Over one year

As of March 31, 2007

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
Bought$352,229,550
296,852,790$

102,922,371
68,620,331

Unrealized
gains (losses)

Fair value$

33,880(41,475)$

33,880(41,475)

557,007,214
642,272,382

26,211,992
61,033,923(171,010)
143,245

29,267
17,059119,905,713
96,935,007

1,709,111
2,132,517(15,244)
17,000(15,244)
17,0004,204,786,936
4,251,386,476
254,091,735
1,638,737

2,743,437,850
2,705,689,589
169,053,491
1,527,438(1,435,850)(163,796)
52,08025,544(1,435,850)(163,796)
52,08025,544

290,498,573
219,389,563

140,739,694
121,056,081(1,034,409)
1,073,079(1,034,409)
1,073,079///$ (1,442,865)

Total

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Derivative transactions qualifying for hedge accounting under “Accounting and Auditing Treatment Relating to Adoption of AccountingStandards for Financial Instruments for Banks” (JICPA Industry Audit Committee Report No.24) and others are excluded from the abovetable.

(b) Currency-Related Transactions
Millions of yen

Contract value
Total
Over one year

As of March 31, 2007

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtTotal¥

20,66925,809¥——Unrealized
gains (losses)

Fair value

¥

(3)
6

¥

(3)
6

18,470,599

12,926,748

67,792

379,483

30,792,179
23,736,388

1,506,140
963,144(299,672)
180,585(299,672)
180,585

13,001,144
15,283,200

7,570,275
9,759,149(1,267,892)
1,120,801(351,281)
354,733

/

/

/

¥

263,850

149

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements

Millions of yen

Contract value
Total
Over one year

As of March 31, 2006

Listed:Futures:
Sold
Bought¥Over-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtTotal

15,81815,680¥——

Unrealized
gains (losses)

Fair value

¥

(0)
0

¥

(0)
0

20,027,237

12,805,106

32,341

343,152

20,575,122
15,791,156

2,093,414
910,037(298,889)
137,014(298,889)
137,0148,204,410
8,097,076

4,950,532
5,061,459(403,904)
316,219

5,992
21,660///¥208,929

Thousands of U.S. dollars

Contract value
Total
Over one year

As of March 31, 2007

Listed:Futures:
Sold
BoughtOver-the-Counter:
Swaps
Forwards:
Sold
BoughtOptions:
Sold
BoughtTotal$

175,031
218,554$——

Unrealized
gains (losses)

Fair value

$

(32)
52

$

(32)
52

156,411,203

109,465,228

574,071

3,213,508

260,751,794
201,002,531

12,754,172
8,156,024(2,537,663)
1,529,220(2,537,663)
1,529,220

110,095,221
129,419,942

64,105,985
82,641,627(10,736,663)
9,491,079(2,974,696)
3,003,925///$ 2,234,314

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. The following transactions are excluded from the above table:•Transactions qualifying for hedge accounting under “Accounting and Auditing Treatment Relating to Adoption of Accounting Standards
for Foreign Currency Transactions for Banks“ (JICPA Industry Audit Committee Report No.25) and others.
•Transactions which are specified for certain financial assets and liabilities denominated in foreign currencies and reflected on the
consolidated balance sheets.
•Transactions denominated in foreign currencies which are eliminated in consolidation.

150

(c) Stock-Related Transactions
Millions of yen

2007

As of March 31,

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtOther:
Sold
BoughtTotal

2006

Contract value
Over
Total
one year¥ 317,565
24,975¥

Fair
Unrealized
value gains (losses)— ¥—(3,488) ¥(10)

Contract value
Over
Total
one year(3,488) ¥ 493,341(10)
11,019¥Fair Unrealized
value gains (losses)— ¥ (15,004) ¥ (15,004)
—
584
584

47,71545,025

—
1,190

(559)
540

220
(350)

27,52034,143

—
2,456

(216)
2,814

114
(114)

997,948
971,469

398,456
371,788(100,747)
100,144(55,733)
62,461

488,483
553,742

261,706
312,035(91,931)
99,443(54,140)
63,2994,300
101,370

4,300
100,878

(849)
1,791

(849)
1,791

—
71,668—71,668

—
(36)

—
(36)

/

/

4,041

/

/

/ ¥

/ ¥

(5,297)

Thousands of U.S. dollars

2007

As of March 31,

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtOther:
Sold
BoughtTotal

Contract value
Over
Total
one year$2,689,178
211,497
404,056
381,279$

Fair
Unrealized
value gains (losses)— $ (29,538) $ (29,538)
—
(91)
(91)
—
10,079(4,735)
4,579

1,869
(2,966)8,450,743 3,374,180
8,226,517 3,148,349(853,140)
848,032(471,960)
528,930(7,194)
15,174(7,194)
15,17436,413
858,418

36,413854,253/// $ 34,224

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.

151

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(d) Bond-Related Transactions
Millions of yen

2007

As of March 31,

Listed:Futures:
Sold
BoughtFutures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Contract value
Over
Total
one year¥ 458,455
891,068¥

2006
Contract value
Fair
Unrealized
value gains (losses)——¥ 1,471(1,263)445,036
136,864

765
—

(180)
156

48
(38)

318,435
299,427

12,00014,711

(708)
823

/

/

/

Total

¥ 1,471 ¥ 1,704,327(1,263) 2,061,957¥Over
one year¥

Fair Unrealized
value gains (losses)——¥ 6,292(6,390)¥ 6,292(6,390)203,226
895,666—
88(1,046)
2,569

102
708

(70)
253

525,294548,580

12,00012,000(2,544)
2,085

(606)
201

400

/

/

/

¥

307

Thousands of U.S. dollars

2007

As of March 31,

Listed:Futures:
Sold
BoughtFutures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Contract value
Over
Total
one year$3,882,257
7,545,676$

Fair
Unrealized
value gains (losses)——$ 12,460(10,703)$ 12,460(10,703)3,768,622
1,158,988

6,479—(1,530)
1,329

408
(322)

2,696,545
2,535,587

101,617
124,575(5,997)
6,970

(597)
2,144

/

/

/

$ 3,390

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.

152

(e) Commodity-Related Transactions
Millions of yen

2007
Contract value
Over
Total
one year

As of March 31,

Listed:Futures:
Sold
BoughtFutures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
Bought
Total

2006

¥

Fair
Unrealized
value gains (losses)

17,008 ¥18,271

1,919 ¥
1,633

27
114

45,531
4,007——

544,304
546,535/¥

Contract value
Over
Total
one year

Fair Unrealized
value gains (losses)

27 ¥
114

11,604 ¥14,084— ¥86(583) ¥
729

(583)
729

(96)
112

(96)
112

—
—

—
—

—
—

—
—

397,233
393,256(129,352)
145,473(129,352)
145,473

431,987
431,408

283,677
280,743(176,537)
187,038(176,537)
187,038//¥ 16,278///¥ 10,647

Thousands of U.S. dollars

2007

As of March 31,

Listed:Futures:
Sold
BoughtFutures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Contract value
Over
Total
one year$ 144,026 $ 16,259 $
154,726
13,830385,565
33,939——Fair
Unrealized
value gains (losses)

229
971
(815)
950

$

229
971
(815)
950

4,609,231 3,363,824 (1,095,374) (1,095,374)
4,628,126 3,330,139 1,231,887 1,231,887///$137,848

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.
3. Commodities include oil, copper, aluminium and others.

153

Financial Data of Mizuho Financial Group, Inc.

Notes to Consolidated Financial Statements(f) Credit Derivative Transactions
Millions of yen

2007

2006

Contract value
As of March 31,

Over-the-Counter:
Credit Derivatives:
Sold
BoughtTotal

Contract valueOver
one year

Fair
Unrealized
value gains (losses)

Total

Over
one year¥ 5,470,755 ¥ 5,327,411 ¥ 38,221 ¥ 38,221 ¥2,026,709 ¥1,843,281
7,247,444 7,095,001(46,936)(46,936) 2,181,950 2,075,002

Total

/

/

/ ¥

(8,714)/

Fair Unrealized
value gains (losses)¥ 11,449
741¥ 11,449
741/¥ 12,191/

Thousands of U.S. dollars

2007
Contract value
As of March 31,

Over-the-Counter:
Credit Derivatives:
Sold
BoughtTotal

Over
one year

Fair
Unrealized
value gains (losses)$46,326,999 $45,113,150 $ 323,665 $ 323,665
61,372,215 60,081,307 (397,463) (397,463)

Total

/

/

/ $ (73,798)

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.
3. “Sold” and “Bought” indicate assumption and cession of credit risk, respectively.

(g) Weather Derivative Transactions
Millions of yen

2007

2006

Contract value
As of March 31,

Over-the-Counter:
Weather Derivatives:
Sold
Bought

Total

¥

Total

81
68

Contract valueOver
one year

¥

/

—
—

Fair
Unrealized
value gains (losses)

¥

/

(1)
9

¥

(1)
9

/

¥

8

Total

¥

297
232
/

Over
one year¥——/

Fair Unrealized
value gains (losses)

¥

(34)
36

¥

(34)
36

/

¥

1

Thousands of U.S. dollars

2007
Contract value
As of March 31,

Over-the-Counter:
Weather Derivatives:
Sold
Bought
Total

Total

$

691
577
/

Over
one year

$

—
—
/

Fair
Unrealized
value gains (losses)

$

(11)
80

$

(11)
80

/

$

69

Notes: 1. The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statements ofincome.
2. Transactions are related to temperature, rainfall and others.

154

Non-Consolidated Financial Statements ofMizuho Financial Group, Inc. and Four
Subsidiaries[Under Japanese GAAP]
Mizuho Financial Group, Inc.
Non-Consolidated Balance Sheets

156

Non-Consolidated Statements of Income

157

Mizuho Corporate Bank, Ltd.
Non-Consolidated Balance Sheets

158

Non-Consolidated Statements of Income

160

Mizuho Bank, Ltd.
Non-Consolidated Balance Sheets

161

Non-Consolidated Statements of Income

163

Mizuho Trust & Banking Co., Ltd.
Non-Consolidated Balance Sheets

164

Non-Consolidated Statements of Income

166

Mizuho Securities Co., Ltd.
Non-Consolidated Balance Sheets

167

Non-Consolidated Statements of Income

170

155

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Financial Group, Inc.

Non-Consolidated Balance Sheets
Millions of yen
2007

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
Deferred Assets
Total Assets
Liabilities, Net Assets and Shareholders' Equity
Liabilities
Current Liabilities
Short-term Borrowings
Short-term Bonds
Other Current Liabilities
Non-Current Liabilities¥$

2,187,732
23,091
2,164,641
38,154,690
8,064
35,562
38,076,308
34,756—$ 40,342,422¥ 1,585,093
1,380,000
203,000
2,093
2,538

¥ 2,039,479
965,000
1,072,000
2,479
1,261

$ 13,422,759
11,686,002
1,719,028
17,72921,494

1,587,631

2,040,741

13,444,253

3,176,394
1,540,965
385,241
385,241
1,252,226
4,350
1,247,876
1,247,876(2,037)
9
9

/
/
/
/
/
/
/
/
/
/
/

26,898,085
13,049,073
3,262,270
3,262,270
10,603,999
36,836
10,567,163
10,567,163(17,257)
84
84

3,176,404/

26,898,169/$ 40,342,422

1,540,965
385,291385,24150
827,306
4,350
822,956
12(1,255)

/
/
/
/
/
/
/
/
/

Total Net Assets¥ 4,764,036

Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Other Capital Surplus
Retained Earnings
Appropriated Reserve
Unappropriated Retained Earnings
Net Unrealized Gains on Other Securities, net of Taxes
Treasury Stock

/
/
/
/
/
/
/
/
/

Total Shareholders' Equity¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

156

279,234
2,361
276,873
4,513,521
771
4,304
4,505,283
3,162
304

¥ 4,793,061

Total Liabilities

Total Liabilities and Shareholders' Equity

¥

2006

¥ 4,764,036

Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Retained Earnings Brought Forward
Treasury Stock
Valuation and Translation Adjustments
Net Unrealized Gains on Other Securities, net of Taxes
Total Liabilities and Net Assets

258,349
2,726
255,622
4,505,687
952
4,199
4,496,431
4,104—

Thousands of
U.S. dollars
2007

¥

/

2,752,319/¥ 4,793,061/$/

Non-Consolidated Statements of Income
2006

Thousands of
U.S. dollars
2007¥ 1,250,099
1,220,997
29,102¥ 128,990
112,528
16,461$ 10,585,991
10,339,552
246,439

19,205
19,205

13,477
13,477

162,638
162,638

Operating Profits
Non-Operating Income
Non-Operating Expenses

1,230,893
25,024
16,280115,512683,187
8,466

10,423,353
211,910
137,867

Income before Income Taxes
Income Taxes:
Current
Deferred

1,239,637

790,232

10,497,396

5
(78)

30
(38)

45
(665)

¥ 1,239,710¥ 790,240$ 10,498,016

Millions of yen
2007

For the Fiscal Years ended March 31,

Operating Income
Cash Dividends Received from Subsidiaries and Affiliates
Fee and Commission Income Received from Subsidiaries and Affiliates
Operating Expenses
General and Administrative Expenses

Net Income

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

157

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Corporate Bank, Ltd.

Non-Consolidated Balance Sheets
As of March 31,

AssetsCash and Due from Banks
Call Loans
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
Other Assets
Tangible Fixed Assets
Intangible Fixed Assets
Premises and Equipment
Deferred Debenture Charges
Customers' Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Reserve for Possible Losses on Investments
Total Assets
Liabilities, Net Assets and Shareholders' Equity
Liabilities
Deposits
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending Transactions
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Short-term Bonds
Bonds and Notes
Other Liabilities
Reserve for Bonus Payments
Reserve for Director and Corporate Auditor Retirement Benefits
Reserve for Contingencies
Deferred Tax Liabilities
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities

158

2006

Thousands of
U.S. dollars
2007¥ 2,029,748
290,596
1,742,202
1,614,829
204,9622,559,277
2,362
19,457,137
28,734,856
752,828
4,813,527
122,416
67,497/0
4,072,678(353,347)(100)¥ 2,608,394
441,553458,2132,580,438
200,368
2,934,429
6,908
15,929,624
28,263,509
667,800
4,642,734//
135,62203,706,410(366,272)(1,114)$ 17,188,151
2,460,805
14,753,175
13,674,569
1,735,643
21,672,260
20,006
164,765,327
243,330,144
6,375,039
40,761,515
1,036,639
571,574/2
34,487,923(2,992,190)(848)¥ 66,111,474¥ 62,208,622$ 559,839,734¥ 26,627,263
3,203,020
8,811,369
6,072,047
1,233,785
1,922,795
4,424,227
356,761
402,600
738,809
4,531,077
2,751
2,381
1,376
180,984
27,475
4,072,678¥ 26,620,674
4,657,501
8,198,832
4,272,086
2,771,715
2,202,854
2,517,814
415,621203,400
123,100
3,180,497
2,379/
33,557
100,373
27,5693,706,410$ 225,482,799
27,123,550
74,615,711
51,418,815
10,447,845
16,282,455
37,464,881
3,021,102
3,409,264
6,256,329
38,369,698
23,29920,165
11,6581,532,602
232,664
34,487,923

62,611,407

59,034,387

530,200,760

Millions of yen
2007Non-Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

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 on Other Securities, net of Taxes
Net Deferred Hedge Losses, net of Taxes
Revaluation Reserves for Land, net of Taxes

2,391,510
1,070,965
330,334
330,334
990,21030,700959,510959,510
1,108,556
1,135,629(65,292)
38,218

Total Net Assets
Total Liabilities and Net Assets

3,500,066¥ 66,111,474

Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Unappropriated Retained Earnings
Revaluation Reserve for Land, net of Taxes
Net Unrealized Gains on Other Securities, net of Taxes

/
/
/
/
/
/
/
/

Total Shareholders' Equity
Total Liabilities and Shareholders' Equity

¥

¥

2006

Thousands of
U.S. dollars
2007

/
/
/
/
/
/
/
/
/
/
/
/

20,251,589
9,069,057
2,797,309
2,797,309
8,385,223
259,971
8,125,252
8,125,252
9,387,385
9,616,644(552,901)
323,642/

29,638,974/$ 559,839,734

1,070,965
330,334
330,334
795,060
5,000
790,060
38,355939,519

/
/
/
/
/
/
/
/

/

3,174,234/¥ 62,208,622/$/

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

159

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Corporate Bank, Ltd.

Non-Consolidated Statements of Income
2006

Thousands of
U.S. dollars
2007¥ 1,282,775
646,336
421,362
175,401
96,96165,061
317,081¥ 1,079,487
445,734
491,337
152,325
40,192
93,843
288,439$ 10,862,691
5,473,254
3,568,147
1,485,318
821,081
550,948
2,685,087

1,937,281

1,654,288

16,405,125

976,269
501,579
32,032
39,836
4,160
52,062
237,866
183,571594,734
248,199
45,37732,6806,514
91,799222,452
116,304

8,267,167
4,247,431
271,258
337,338
35,236440,869
2,014,284
1,554,505

1,493,767

1,064,485

12,649,399

443,513589,8033,755,726

38
120,343
323,13137
103,205
486,560

329
1,019,085
2,736,312

Millions of yen
2007

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
Debentures
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¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

160

¥

$

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Bank, Ltd.

Non-Consolidated Balance Sheets
As of March 31,

AssetsCash and Due from Banks
Call Loans and Bills Purchased
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
Intangible Fixed Assets
Premises and Equipment
Deferred Debenture Charges
Deferred Tax Assets
Customers' Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Reserve for Possible Losses on Investments
Total Assets
Liabilities, Net Assets and Shareholders' Equity
Liabilities
Deposits
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Guarantee Deposits Received under Securities Lending Transactions
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Bonds and Notes
Other Liabilities
Reserve for Bonus Payments
Reserve for Director and Corporate Auditor Retirement Benefits
Reserve for Frequent Users Services
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities

2006

Thousands of
U.S. dollars
2007¥ 2,838,104
4,340,000
2,634,880
2,313,455
839,706686
15,226,739
34,065,059
131,895
2,530,250
603,955
119,882/21
332,168
1,322,242(340,828)(83,430)¥ 3,183,778
2,306,500
2,070,550
1,553,257
609,371584
20,504,122
34,188,553
128,504
1,925,150//
718,859267
369,956
2,834,710(306,951)(83,487)$ 24,033,399
36,751,630
22,312,481
19,590,610
7,110,729
5,809
128,941,822
288,466,930
1,116,909
21,426,458
5,114,365
1,015,182/
186
2,812,845
11,196,908(2,886,172)(706,502)¥ 66,874,790¥ 70,003,728$ 566,303,589¥ 54,347,498
1,564,366
1,509,400
2,999
1,499,943
231,277
1,177,230
13,703
522,500
2,509,448
7,644
1,676
3,773
79,797
1,322,242¥ 54,556,847
2,016,614
1,663,800
464,968
2,480,278
311,363
1,260,744
19,949311,600
1,962,745
6,914
/
629
93,304
2,834,710$ 460,221,007
13,247,238
12,781,777
25,39812,701,700
1,958,483
9,968,928
116,041
4,424,591
21,250,303
64,734
14,193
31,953675,731
11,196,908

64,793,501

67,984,470

548,678,985

Millions of yen
2007

161

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Bank, Ltd.

Non-Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Other Retained Earnings
Retained Earnings Brought Forward
Valuation and Translation Adjustments
Net Unrealized Gains on Other Securities, net of Taxes
Net Deferred Hedge Losses, net of Taxes
Revaluation Reserve for Land, net of Taxes

1,776,171
650,000
762,345762,345
363,825
363,825
363,825
305,118
251,748(59,027)
112,397

Total Net Assets
Total Liabilities and Net Assets

2,081,289¥ 66,874,790

Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Unappropriated Retained Earnings
Revaluation Reserve for Land, net of Taxes
Net Unrealized Gains on Other Securities, net of Taxes

/
/
/
/
/
/
/

Total Shareholders' Equity
Total Liabilities and Shareholders' Equity¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

162

¥

2006

Thousands of
U.S. dollars
2007

/
/
/
/
/
/
/
/
/
/
/

15,040,825
5,504,276
6,455,634
6,455,634
3,080,915
3,080,915
3,080,915
2,583,779
2,131,840(499,854)
951,793/

17,624,604/$ 566,303,589

650,000
762,345762,345
268,529
268,529
132,028
206,353

/
/
/
/
/
/
/

/

2,019,257/¥ 70,003,728/$/

Non-Consolidated Statements of Income
Millions of yen
2007

For the Fiscal Years ended March 31,

Thousands of
U.S. dollars
2007

2006

IncomeInterest Income
Loans and Bills Discounted
Securities
Fee and Commission Income
Trading Income
Other Operating Income
Other Income¥

Total Income

747,368
539,736
137,793262,325
36,919167,984
171,470$

6,328,804
4,570,554
1,166,851
2,221,406
312,643
1,422,512
1,452,033

1,225,843

11,737,398

153,538
84,0992,545
45,6301,187
35,717536,875
328,838

84,63831,184
3,354
51,686
6,669
101,831553,232
212,591

1,300,184
712,162
21,557
386,405
10,058302,458
4,546,326
2,784,646

1,101,788

1,010,650

9,330,077

284,280

215,193

2,407,321

500
77,490519
77,614

4,238
656,200

Income before Income Taxes
Income Taxes:
Current
Deferred
Net Income

652,155
499,195
95,170267,778
5,441
200,194
100,273

1,386,069

Expenses
Interest Expenses
Deposits
Debentures
Fee and Commission Expenses
Trading Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses¥¥

206,289¥

137,060$

1,746,883

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

163

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Trust & Banking Co., Ltd.

Non-Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

AssetsCash and Due from Banks
Call Loans and Bills Purchased
Other Debt Purchased
Trading Assets
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Tangible Fixed Assets
Intangible Fixed Assets
Premises and Equipment
Deferred Tax Assets
Customers' Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Reserve for Possible Losses on Investments
Total Assets
Liabilities, Net Assets and Shareholders' Equity
Liabilities
Deposits
Call Money and Bills Sold
Guarantee Deposits Received under Securities Lending Transactions
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Bonds and Notes
Due to Trust Accounts
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Reserve for Director and Corporate Auditor Retirement Benefits
Reserve for Contingencies in Trust Transactions
Acceptances and Guarantees
Total Liabilities

164¥

225,832
60,000265,039
26,1701,719,550
4,026,203
307
192,993
32,781
17,227/18,804
48,460(46,957)(7)¥

Thousands of
U.S. dollars
2007

2006

293,321
132,300
251,430
41,744
1,715,086
3,532,645
4,287
193,822//40,9885,488
61,191(30,527)—$

1,912,379
508,0872,244,389
221,617
14,561,354
34,094,365
2,607
1,634,289
277,596
145,883/
159,238
410,369(397,640)(61)¥ 6,586,407¥ 6,241,779$ 55,774,472¥ 3,433,751
597,443
493,982
25,079257,932
15
152,200
996,495
48,8491,505
10,323322
11,67048,460¥ 3,075,481
1,061,143
169,806
45,43137,065
11
161,500
1,124,099
37,954
1,345
10,007/
12,01061,191$ 29,077,408
5,059,222
4,183,102
212,373
2,184,206
127
1,288,848
8,438,443
413,660
12,74987,424
2,731
98,825
410,369

6,078,031

5,797,049

51,469,487

Non-Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

Net Assets
Shareholders' Equity
Common Stock and Preferred Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Retained Earnings Brought Forward
Treasury Stock
Valuation and Translation Adjustments
Net Unrealized Gains on Other Securities, net of Taxes
Net Deferred Hedge Gains, net of Taxes

365,776
247,231
15,367
15,367103,287
4,904
98,383
98,383(110)
142,599
141,816782

Total Net Assets
Total Liabilities and Net Assets

508,375¥ 6,586,407

¥

2006

Thousands of
U.S. dollars
2007

/
/
/
/
/
/
/
/
/
/
/
/

3,097,437
2,093,589
130,133
130,133
874,653
41,532
833,121833,121(938)
1,207,548
1,200,921
6,627/

4,304,985/$ 55,774,472

Shareholders' Equity
Common Stock and Preferred Stock/247,231/

Capital Surplus
Capital Reserve
Other Capital Surplus
Retained Earnings
Appropriated Reserve
Unappropriated Retained Earnings
Net Unrealized Gains on Other Securities, net of Taxes
Treasury Stock

/
/
/
/
/
/
/
/

15,371
15,367
3
75,6383,269
72,368106,573
(84)

/
/
/
/
/
/
/
/

Total Shareholders' Equity
Total Liabilities and Shareholders' Equity¥/

444,729/¥ 6,241,779/$/

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

165

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Trust & Banking Co., Ltd.

Non-Consolidated Statements of Income
Millions of yen
2007

For the Fiscal Years ended March 31,

2006

Thousands of
U.S. dollars
2007

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¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

166

66,134
83,27855,79323,756
63,154893
6,144
23,304¥

77,94872,50752,237
18,782
59,7401,005
3,159
16,540$560,037
705,214472,470
201,171534,798
7,564
52,029197,342

242,909230,9022,056,984

31,085
12,251
14,545
6
98
91,83324,753

27,883
6,044
17,2193
5,425
83,96844,112

263,238
103,750
123,17054
832
777,659
209,611

162,322

178,613

1,374,564

80,58652,288682,42025
11,74339
21,222

215
99,447

68,817¥31,027$582,758

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Securities Co., Ltd.

Non-Consolidated Balance Sheets
As of March 31,

AssetsCurrent Assets
Cash and Deposits
Cash Segregated as Deposits
Trading Assets
Operating Investment Securities
Operating Loan Receivables
Margin Transaction Assets
Loans Secured by Securities
Payments for Subscription
Guarantee Deposits
Securities: Fail to Deliver
Variation Margin Paid
Accrued Income
Tax Refundable
Short-term Deferred Tax Assets
OthersAllowance for Doubtful Accounts
Fixed Assets
Tangible Fixed Assets
Intangible Fixed Assets
Investments
Total Assets

2006

Thousands of
U.S. dollars
2007¥ 10,278,106
38,66518,198
5,671,001
40,091500
870
4,422,012
329
54,738991
2,674
19,976
1,704
3,951
2,405
(5)
258,008
6,182
8,314
243,510¥ 10,530,330
30,06821,0935,400,149
18,672—
11,018
4,943,175
19,33542,070
4
18,664
17,038
—
8,144
905
(11)
254,979
5,887
6,655
242,436$ 87,036,214
327,425
154,107
48,022,705
339,496
4,234
7,375
37,446,118
2,791
463,532
8,399
22,652
169,167
14,431
33,46020,368(46)
2,184,844
52,35770,412
2,062,075¥ 10,536,114¥ 10,785,309$ 89,221,058

Millions of yen
2007

167

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Securities Co., Ltd.

Non-Consolidated Balance Sheets
As of March 31,

Liabilities, Net Assets and Shareholders' Equity
Liabilities
Current Liabilities
Trading Liabilities
Payable - Unsettled Trades
Margin Transaction Liabilities
Borrowings Secured by Securities
Deposits Received
Cash Collateral Received from Customers
Securities: Fail to Receive
Short-term Borrowings
Commercial Paper
Short-term Bonds and Notes
Advance Receipt
Accrued Expenses
Income Taxes Payable
Reserve for Bonuses
Others
Non-Current Liabilities
Bonds and Notes
Long-term Borrowings
Long-term Borrowings from Affiliates
Deferred Tax Liabilities
Reserve for Retirement Benefits
Reserve for Retirement Benefits for Directors and Operating Officers
OthersStatutory Reserves
Securities Transaction Liability Reserve
Futures Transaction Liability Reserve
Total Liabilities

168

2006

Thousands of
U.S. dollars
2007¥ 9,513,310
4,328,457
132,8458,716
2,834,477
18,6899,247
989
1,754,276
390,200
11,200765
16,069—6,682
694
617,149
302,800
190,560
116,400
—
6,938
451
—
2,027
1,922
104

¥ 9,974,588
4,379,593
297,405
12,3362,909,359
17,884
19,071—
1,987,836
308,700
1,300
467
11,723
20,135
7,937
836
417,166
213,100
168,383
24,700
4,266
6,686
/
29
1,700
1,616
83

$ 80,559,835
36,653,887
1,124,951
73,81024,002,685
158,266
78,3098,381
14,855,416
3,304,260
94,843
6,481
136,079—
56,5855,882
5,226,098
2,564,146
1,613,687
985,689—
58,752
3,824—
17,172
16,284888

10,132,488

10,393,454

85,803,105

Millions of yen
2007Non-Consolidated Balance Sheets
Millions of yen
2007

As of March 31,

Net Assets
Shareholders' Equity
Common Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Other Retained Earnings
Reserve for Special Depreciation
Special Voluntary Earned Reserve
Retained Earnings Brought Forward
Valuation and Translation Adjustments
Net Unrealized Gains on Other Securities, net of Taxes
Net Deferred Hedge Losses, net of Taxes

377,605
195,146
125,288
125,288
57,171
870
56,30012
1,500
54,78826,02029,174(3,154)

Total Net Assets
Total Liabilities and Net Assets

403,626¥ 10,536,114

Shareholders' Equity
Common Stock
Capital Surplus
Capital Reserve
Retained Earnings
Appropriated Reserve
Voluntary Reserve
Unappropriated Retained Earnings
Unrealized Gains on Other Securities, net of Taxes

/
/
/
/
/
/
/
/

Total Shareholders' Equity
Total Liabilities and Shareholders' Equity

¥

¥

2006

Thousands of
U.S. dollars
2007

/
/
/
/
/
/
/
/
/
/
/
/
/

3,197,609
1,652,519
1,060,958
1,060,958
484,132
7,370
476,762104
12,702463,956
220,344
247,055(26,711)/3,417,953/$ 89,221,058

195,146
125,288
125,288
35,969870
1,561
33,53635,451

/
/
/
/
/
/
/
/

/

391,854/¥ 10,785,309/$/

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

169

Non-Consolidated Financial Statements of Mizuho Financial Group, Inc. and Four Subsidiaries

Mizuho Securities Co., Ltd.

Non-Consolidated Statements of Income
2006

Thousands of
U.S. dollars
2007¥ 135,932
72,221
34,967555
28,18820,631¥ 138,874
66,53959,863
1,698
10,772
11,407$ 1,151,091
611,577
296,106
4,703
238,705
174,714Net Operating Income

115,300

127,467

976,377

Selling, General and Administrative Expenses
Commission and Other Transaction-related Expenses
Compensation and Benefits
Occupancy
Data Processing and Office Supplies
Depreciation
Amortization of Goodwill
Taxes and Dues Other than Income Taxes
Others71,771
18,07130,298
10,634
5,239
4,047
60
1,587
1,831

66,043
17,562
29,878
7,984
4,080
3,421
/
1,827
1,289

607,766
153,034
256,570
90,05344,37034,278508
13,444
15,509Operating Profits
Non-Operating Income
Non-Operating Expenses

43,5294,817
3,079

61,4233,889
2,519

368,61140,79326,076

Ordinary Profits
Extraordinary Gains
Extraordinary Losses

45,2679768

62,793
2,547
41,250383,328
81
6,507

Income before Income Taxes
Income Taxes:
Current
Deferred

44,50824,090376,902

12,892
3,780

29,515(19,038)

109,178
32,014

Millions of yen
2007

For the Fiscal Years ended March 31,

Operating Income
Commission Income
Trading Income
Net Gains on Operating Investment Securities
Interest and Dividend Income
Less: Interest Expense

Net Income¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥118.09=US$1.00, the foreign exchange rate on March 31, 2007, has been used for translation.

170

27,835¥

13,612$

235,710

Status of Capital Adequacy
Capital Adequacy Ratio Highlights

172

Status of Consolidated Capital Adequacyof Mizuho Financial Group, Inc.

174

Scope of Consolidation

174

Consolidated Capital Adequacy Ratio

176

Risk-Based Capital

178

Credit Risk

188

Methods for Credit Risk Mitigation

195

Counterparty Risk in Derivatives Transactions

196

Securitization Exposure

197

Market Risk

201

Operational Risk

201

Equities Exposure

201

171

Status of Capital Adequacy

Capital Adequacy Ratio Highlights

The new capital adequacy framework (“Basel II”) that was under consideration by the Basel Committee on Banking Supervisionbecame effective in the fiscal year ended March 31, 2007. Substantial changes have been made to the method for calculating
capital ratios compared to the previous framework, such as the refinements in calculating credit risk-weighted assets and inclusion of operational risk.
In Japan, disclosure of information is required for the items set forth in “The Matters Separately Prescribed by the Financial
Services Agency Regarding Capital Adequacy Conditions, etc., pursuant to Article 19-2, Paragraph 1, Item 5, Subsection 4, etc.
of the Ordinance for Enforcement of Banking Law (Ministry of Finance Ordinance Number 10 of 1982)” (FSA Notice Number 15
of 2007).

Capital Adequacy Ratio Highlights
Mizuho Financial Group (Consolidated)
Billions of yen

As of March 31,

2007 (Basel II basis)(Reference)
2007 (Basel I basis)12.48%
6.96%

11.58%
6.17%

Consolidated Capital Adequacy Ratio (BIS Standard)
Tier 1 Capital Ratio
Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

4,933.5
4,092.6
184.7¥

4,945.6
4,461.8
121.9

Total Risk-based Capital¥

8,841.3¥

9,285.6

Risk-weighted Assets¥ 70,795.4¥ 80,118.4

2007 (Basel II basis)(Reference)
2007 (Basel I basis)14.01%
8.56%

12.99%
7.66%(Reference)
Mizuho Corporate Bank (Consolidated)
Billions of yen

As of March 31,

Consolidated Capital Adequacy Ratio (BIS Standard)
Tier 1 Capital Ratio
Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

3,256.8
2,252.1
179.4¥

3,257.9
2,366.5
106.3

Total Risk-based Capital¥

5,329.5

Risk-weighted Assets¥ 38,024.4¥ 42,476.6¥

5,518.1

2007 (Basel II basis)(Reference)
2007 (Basel I basis)15.22%
8.20%

14.15%
7.41%

Mizuho Corporate Bank (Non-Consolidated)
Billions of yen

As of March 31,

Non-consolidated Capital Adequacy Ratio (BIS Standard)
Tier 1 Capital Ratio

172

Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

2,922.8
2,564.4
61.1

Total Risk-based Capital¥

5,426.2

Risk-weighted Assets¥ 35,631.2¥

2,924.3
2,681.8
23.7¥

5,582.4¥ 39,444.8

Mizuho Bank (Consolidated)
Billions of yen

As of March 31,

2007 (Basel II basis)(Reference)
2007 (Basel I basis)11.74%
7.11%

10.31%
5.97%

Consolidated Capital Adequacy Ratio (Domestic Standard)
Tier 1 Capital Ratio
Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

2,067.7
1,385.6
40.5

Total Risk-based Capital¥

3,412.8

Risk-weighted Assets¥ 29,053.6(Reference) Consolidated Capital Adequacy Ratio (BIS Standard)¥

2,074.2
1,540.4
36.1¥

3,578.5¥ 34,705.4

11.92%

11.03%

2007 (Basel II basis)(Reference)
2007 (Basel I basis)12.12%
7.39%

10.23%
5.82%

Mizuho Bank (Non-Consolidated)
Billions of yen

As of March 31,

Non-consolidated Capital Adequacy Ratio (Domestic Standard)
Tier 1 Capital Ratio
Tier 1 Capital
Tier 2 Capital
Deductions for Total Risk-based Capital¥

1,965.3
1,324.2
66.3

Total Risk-based Capital¥

3,223.1

Risk-weighted Assets¥ 26,586.2(Reference) Non-consolidated Capital Adequacy Ratio (BIS Standard)

11.83%¥

1,994.0
1,537.4
29.7¥

3,501.7¥ 34,219.7
10.85%

173

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

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
None.
(b) Number of Consolidated Subsidiaries
As of March 31,

2007

Consolidated Subsidiaries

133

The major consolidated subsidiaries are Mizuho Corporate Bank Ltd., Mizuho Bank Ltd., Mizuho Trust and Banking Co., Ltd. andMizuho Securities Co., Ltd.
The following table sets forth information with respect to our principal consolidated subsidiaries as of March 31, 2007:
Proportion of
VotingInterest (%)

Name

Main Business

Domestic
Mizuho Corporate Bank, Ltd.
Mizuho Bank, Ltd.
Mizuho Securities Co., Ltd.
Mizuho Trust & Banking Co., Ltd.
Mizuho Investors Securities Co., Ltd.
Trust & Custody Services Bank, Ltd.
Dai-Ichi Kangyo Asset Management Co., Ltd.
Fuji Investment Management Co., Ltd.
Mizuho Research Institute Ltd.
Mizuho Information & Research Institute Inc.
Mizuho Financial Strategy Co., Ltd.
Mizuho Private Wealth Management Co., Ltd.
Mizuho Factors, Limited
Mizuho Credit Guarantee Co., Ltd.
Mizuho Capital Co., Ltd.
UC Card Co., Ltd.
Defined Contribution Plan Services Co., Ltd.

Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan
Japan

Banking
Banking
Securities
Trust and banking
Securities
Trust and banking
Investment management
Investment management
Research and consulting
Information technology
Consulting
Consulting
Factoring
Credit guarantee
Venture capital
Credit card
Pension plan-related business100.0%
100.0
81.5
75.2
66.5
54.0
100.0
94.3
98.4
91.5
100.0
100.0
100.0
100.0
50.0
51.0
60.0

100.0%
100.0
81.5
70.0
66.8
54.0
100.0
94.3
98.6
91.5
100.0
100.0
100.0
100.0
50.0
51.0
60.0

Overseas
Mizuho Bank (Switzerland) Ltd.
Mizuho Capital Markets Corporation
Mizuho Corporate Bank (Canada)
Mizuho Corporate Bank (Germany) Aktiengesellschaft
Mizuho Corporate Bank (USA)Mizuho Corporate Bank Nederland N.V.
Mizuho International plc
Mizuho Securities USA Inc.
Mizuho Trust & Banking (Luxembourg) S.A.
Mizuho Trust & Banking Co. (USA)PT. Bank Mizuho Indonesia

Switzerland
U.S.A.
CanadaGermany
U.S.A.
Netherlands
U.K.
U.S.A.
Luxembourg
U.S.A.
Indonesia

Trust and banking
Derivatives
Banking
Banking and securities
Banking
Banking and securities
Securities and banking
Securities
Trust and banking
Trust and banking
Banking100.0%
100.0
100.0
83.3
100.0
100.0
100.0
100.0
100.0
100.0
99.0

100.0%
100.0
100.0
83.3
100.0
100.0
100.0
100.0
100.0
100.0
99.0

Notes: 1. Mizuho Investors Securities and Mizuho Trust & Banking are listed on the Tokyo Stock Exchange.
2. On July 1, 2007, Dai-Ichi Kangyo Asset Management and Fuji Investment Management merged to form Mizuho Asset Management Co., Ltd.
3. UC Card, formerly a consolidated subsidiary of ours, became an equity method affiliate in June 2007.

174

Proportion of
Ownership
Interest (%)

Country ofOrganization

(c) Corporations Providing Financial Services for which Article 9 of the Consolidated Capital Ratio Notice isApplicable
None.
(d) Related Companies for which Deductions Set Forth in Article 8, Paragraph 1, Item 2, Subsections 1 to 3 of theConsolidated Capital Adequacy Ratio Notice are Applicable
None.
(e) Companies Described in Article 52-23, Paragraph 1, Item 10 of the Banking Law that are Engaged Mainly inBusinesses as Described in Subsection 1 of Such Item or Companies Set Forth in Item 11 of Such Paragraph,
but that are not in the Holding Company's Corporate GroupNone.
(f) Restrictions on Transfer of Funds or Capital within the Holding Company's Corporate Group
None.

175

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Consolidated Capital Adequacy Ratio
2. Summary Table of Consolidated Capital Adequacy Ratio (BIS Standard)%, Billions of yen

As of March 31,

2007

Tier 1 Capital
Common Stock and Preferred Stock
Non-cumulative Perpetual Preferred Stock
Advance Payment for New Shares
Capital Surplus
Retained Earnings
Less: Treasury Stock
Advance Payment for Treasury Stock
Less: Dividends (Estimate), etc
Less: Unrealized Losses on Other Securities
Foreign Currency Translation Adjustments
Rights to Acquire New Shares
Minority Interest in Consolidated Subsidiaries
Preferred Securities Issued by Overseas SPCs
Less: Goodwill Equivalent
Less: Intangible Fixed Assets Recognized as a Result of a Merger
Less: Capital Increase due to Securitization Transactions
Less: 50% of Excess of Expected Losses relative to Eligible Reserves by Banks Adopting Internal Ratings-based Approach
Total of Tier 1 Capital before Deduction of Deferred Tax Assets (Total of Above Items)
Deduction for Deferred Tax Assets
Total
Preferred Securities with a Step-up Interest Rate Provision
Ratio to Tier 1 = (B) / (A) X 100

¥

(A)
(B)

4,933.5
608.4
12.33%

Tier 2 Capital
45% of Unrealized Gains on Other Securities
45% of Revaluation Reserve for Land
General Reserve for Possible Losses on Loans
Excess of Eligible Reserves relative to Expected Losses by Banks Adopting Internal Ratings-based Approach
Debt Capital, etc.
Perpetual Subordinated Debt and Other Debt Capital
Dated Subordinated Debt and Redeemable Preferred Stock
Total
Tier 2 Capital Included as Qualifying Capital

1,100.8
116.0
7.3
124.1
2,744.1
785.5
1,958.6(C)4,092.6
4,092.6

Tier 3 Capital
Short-term Subordinated Debt
Tier 3 Capital Included as Qualifying Capital

(D)

—
—

Deductions for Total Risk-based Capital(E)

Total Risk-based Capital(F)(A)+(C)+(D)-(E)Risk-weighted Assets
Credit Risk Assets
On-balance-sheet Items
Off-balance-sheet Items
Market Risk Equivalent Assets [(I) / 8%](Reference) Market Risk Equivalent
Operational Risk Equivalent Assets [(K) / 8%](Reference) Operational Risk Equivalent
Adjusted Floor Amount
Total

176

1,540.9——411.1
1,439.9
32.3
—
101.2
—
(38.9)—
1,726.1
1,504.9——
12.1—
4,933.5—(G)+(H)+(J)+(L)

(G)

184.7
¥

8,841.3

(H)
(I)
(J)
(K)
(L)

59,755.0
48,718.5
11,036.4
2,186.4
174.9
3,877.5
310.2
4,976.4(M)¥ 70,795.4

Consolidated Capital Adequacy Ratio (BIS Standard) = (F) / (M) X 100

12.48%

Tier 1 Capital Ratio = (A) / (M) X 100

6.96%

Notes: 1. The above are based on the BIS standard applied on a consolidated basis following the Standards for Determining the Status of Capital
Adequacy in consideration of assets held by a bank holding company and by its subsidiaries, in accordance with Banking Law Article 5225 (FSA Notice No.20 of 2006 (the “Notice”)).
2. Because the company cannot break down its common stock and preferred stock according to classes of stock, no value for noncumulative perpetual preferred stock is separately stated from capital.
3. In calculating the consolidated capital adequacy ratio, we underwent an examination following the procedures agreed with the certified
public accountant, on the basis of “Treatment in implementing examination by agreed-upon procedures for calculating capital adequacy
ratio” (Industry Committee Report No.30 of the Japanese Institute of Certified Public Accountants). Note that this is not a part of theaccounting audit performed on the company's consolidated financial statements.
4. The amount of net deferred tax assets as of March 31, 2007, was ¥170.8 billion, and the maximum amount of deferred tax assets thatcan record without diminishing the amount of Tier 1 capital was ¥1.48 trillion.
5. The “adjusted floor amount” is the amount obtained by multiplying (i) 12.5 to (ii) the excess of the required capital under Basel I
multiplied by the rate prescribed in the Notice over the required capital under Basel II.
Because the amount derived by multiplying the required capital under Basel I by the rate prescribed in the Notice exceeded the required
capital under Basel II, the excess was added to risk-weighted assets.

177

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Risk-Based Capital
3. Summary of Types of Capital Instruments(a) Summary of Preferred Securities
We have included each of the following preferred securities issued by our overseas special purpose companies and the various
preferred securities issued by the overseas special purpose companies of Mizuho Corporate Bank, Ltd. (Mizuho Preferred CapitalCompany L.L.C. and Mizuho JGB Investment L.L.C.), our consolidated subsidiary, as Tier 1 capital for the purposes of our consolidated capital adequacy ratios. Series B preferred securities issued by Mizuho Preferred Capital (Cayman) 1 Limited and preferred
securities issued by Mizuho Preferred Capital (Cayman) 2 Limited were redeemed in full on June 29, 2007.
Preferred securities issued by SPCs of Mizuho Financial Group, Inc.

178

IssuerMizuho Preferred Capital (Cayman) Limited(“MPC,” and the preferred securities
described below are referred to as the“MPC Preferred Securities.”)Mizuho Preferred Capital (Cayman) 1
Limited (as “MPC1,” and the Series A and
Series B preferred securities described
below are collectively referred to as the“MPC1 Preferred Securities.”)Mizuho Preferred Capital (Cayman) 2
Limited (“MPC2,” and the preferred
securities described below are referred toas the “MPC2 Preferred Securities.”)

Type of securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Mandatory
redemption date

None

None

None

Optional
redemption

Optionally redeemable on each dividend
payment date falling in or after June 2009(subject to prior approval from regulatory
authorities)

Series A
Optionally redeemable on each dividend
payment date falling in or after June 2012(subject to prior approval from regulatory
authorities)
Series B
Optionally redeemable on each dividend
payment date falling in or after June 2007
(subject to prior approval from regulatory
authorities)

Optionally redeemable on each dividend
payment date falling in or after June 2007
(subject to prior approval from regulatory
authorities)

Dividends

Floating dividend rate (No dividend rate
step-up. As stated in “Dividend suspension
events” below, dividend payments that aresuspended are non-cumulative.)

Series A - Floating dividend rate (Nodividend rate step-up.)
Series B - Floating dividend rate (A 100
basis point step-up dividend rate is applied
after the dividend payment date falling in
June 2012.) (As stated in “Dividend
suspension events” below, dividend
payments that are suspended are noncumulative.)

Floating dividend rate (A 100 basis point
step-up dividend rate is applied after thedividend payment date falling in June
2012.) (As stated in “Dividend suspension
events” below, dividend payments that aresuspended are non-cumulative.)

Dividend payment
date

Last business day of June in each year

Last business day of June in each year

Last business day of June in each year

Total amount issued¥176.0 billion

Series A: ¥171.0 billion
Series B: ¥112.5 billion¥73.0 billion

Issue date

March 15, 1999

February 14, 2002

February 14, 2002

Dividendsuspension events

If any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to MPC
a dividend instruction instructing it not to
pay any dividends on such dividend
payment date.

If any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC 1 a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC 1 a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to MPC
1 a dividend instruction instructing it not
to pay any dividends on such dividend
payment date.

If any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC 2 a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC 2 a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to MPC
2 a dividend instruction instructing it not
to pay any dividends on such dividend
payment date.

Mandatory dividend
event

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividends are paid to the extent
applicable).

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividends are paid to the extent
applicable).

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividends are paid to the extent
applicable).

Distributableamounts limitation

When Mizuho Financial Group issues aDistributable Amounts Limitation
Certificate (note 4) to MPC, dividends arelimited to the Available Distributable
Amounts (note 3).

When Mizuho Financial Group issues aDistributable Amounts Limitation
Certificate (note 4) to MPC1, dividends arelimited to the Available Distributable
Amounts (note 3).

When Mizuho Financial Group issues aDistributable Amounts Limitation
Certificate (note 4) to MPC2, dividends arelimited to the Available Distributable
Amounts (note 3).

Dividend limitations

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities(note 6)
are also reduced by an equal percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities(note 6)
are also reduced by an equal percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities(note 6)
are also reduced by an equal percentage.

Claims on residual
assetsSame priority as Mizuho Financial Group's
Preferred Stock (note 2)

Same priority as Mizuho Financial Group's
Preferred Stock (note 2)

Same priority as Mizuho Financial Group's
Preferred Stock (note 2)

IssuerMizuho Preferred Capital (Cayman) 5
Limited (“MPC5,” and the preferred
securities described below are referred toas the “MPC5 Preferred Securities.”)Mizuho Preferred Capital (Cayman) 6
Limited (“MPC6,” and the preferred
securities described below are referred toas the “MPC6 Preferred Securities.”)Mizuho Preferred Capital (Cayman) 7
Limited (“MPC7,” and the preferred
securities described below are referred toas the “MPC7 Preferred Securities.”)

Type of securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Mandatory
redemption date

None

None

None

Optional
redemption

Optionally redeemable on each dividend
payment date falling in or after June 2008
(subject to prior approval from regulatory
authorities)

Optionally redeemable on each dividend
payment date falling in or after June 2008
(subject to prior approval from regulatory
authorities)

Optionally redeemable on each dividend
payment date falling in or after June 2008
(subject to prior approval from regulatory
authorities)

Dividends

Floating dividend rate (A 100 basis point
step-up dividend rate is applied beginningthe dividend payment date falling in June
2013.) (As stated in “Dividend suspension
events” below, dividend payments that aresuspended are non-cumulative.)

Floating dividend rate for both Series A
and Series B (A 100 basis point step-up
dividend rate is applied beginning thedividend payment date falling in June
2013.) (As stated in “Dividend suspension
events” below, dividend payments that aresuspended are non-cumulative.)

Floating dividend rate (A 100 basis point
step-up dividend rate is applied beginningthe dividend payment date falling in June
2013.) (As stated in “Dividend suspension
events” below, dividend payments that aresuspended are non-cumulative.)

Dividend payment
date

Last business day of June in each year

Last business day of June in each year

Last business day of June in each year

Total amount issued¥45.5 billion

Series A : ¥19.5 billion
Series B : ¥ 2.5 billion¥51.0 billion

Issue Date

August 9, 2002

Series A : August 9, 2002
Series B : August 30, 2002

August 30, 2002

179

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

180

Dividend suspension
eventsIf any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC5 a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC5 a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to
MPC5 a dividend instruction instructing it
not to pay any dividends on such dividend
payment date.

If any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC6 a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC6 a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to
MPC6 a dividend instruction instructing it
not to pay any dividends on such dividend
payment date.

If any of the following events arise,
dividend payments are suspended on a
non-cumulative basis:(1) when Mizuho Financial Group issues to
MPC7 a Loss Absorption Certificate (note 1);(2) when dividends on Mizuho Financial
Group's Preferred Stock (note 2) aresuspended;(3) when Mizuho Financial Group issues to
MPC7 a Distributable Amounts Limitation
Certificate (note 4) stating that there are no
Available Distributable Amounts (note 3); and(4) when the dividend payment date is not
a Mandatory Dividend Payment Date (note 5),
and Mizuho Financial Group issues to
MPC7 a dividend instruction instructing it
not to pay any dividends on such dividend
payment date.

Mandatory dividend
event

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred Securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividend payments are made to the extent
applicable).

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred Securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividend payments are made to the extent
applicable).

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, full dividends mustbe paid on Parity Preferred Securities (note 6)
in June of the calendar year in which such
fiscal year ends. However, it is subject tothe following conditions: (1) no Loss
Absorption Certificate (note 1) has been
issued; (2) no preferred stock dividend
limitation has arisen with respect thereto(partial dividend payments are made to theextent applicable); and (3) no Distributable
Amounts Limitation Certificate (note 4) has
been issued with respect thereto (partial
dividend payments are made to the extent
applicable).

Distributableamounts limitation

When Mizuho Financial Group issues aDistributable Amounts Limitation
Certificate (note 4) to MPC5, dividends arelimited to the Available Distributable
Amounts (note 3).

When Mizuho Financial Group issues aDistributable Amounts Limitation
Certificate (note 4) to MPC6, dividends arelimited to the Available Distributable
Amounts (note 3).

When Mizuho Financial Group issues aDistributable Amounts Limitation
certificate (note 4) to MPC7, dividends arelimited to the Available Distributable
Amounts (note 3).

Dividend limitation

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities (note 6)
are also reduced by an equal percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities (note 6)
are also reduced by an equal percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 2) are reduced,
dividends on Parity Preferred Securities(note 6)
are also reduced by an equal percentage.

Claims on residual
assetsSame priority as Mizuho Financial Group's
Preferred Stock (note 2)

Same priority as Mizuho Financial Group's
Preferred Stock (note 2)

Same priority as Mizuho Financial Group's
Preferred Stock (note 2)

IssuerMizuho Capital Investment (USD) 1 Limited(“MCI (USD) 1,” and the preferred
securities described below are referred toas “MCI (USD) 1 Preferred Securities.”)Mizuho Capital Investment (EUR) 1 Limited(“MCI (EUR) 1,” and the preferred
securities described below are referred toas “MCI (EUR) 1 Preferred Securities.”)Mizuho Capital Investment (JPY) 1 Limited(“MCI (JPY) 1,” and the preferred
securities described below are referred toas “MCI (JPY) 1 Preferred Securities.”)

Type of securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Non-cumulative perpetual preferred
securities

Mandatory
redemption date

None

None

None

Optional
redemption

Starting from the dividend payment datefalling in June 2016, optionally redeemableon each dividend payment date in five-year
intervals (subject to prior approval from
regulatory authorities)

Starting from the dividend payment datefalling in June 2011, optionally redeemableon each dividend payment date in five-year
intervals (subject to prior approval from
regulatory authorities)

Starting from the dividend payment datefalling in June 2016, optionally redeemableon each dividend payment date in five-year
intervals (subject to prior approval from
regulatory authorities)

Dividends

Fixed dividend rate for the first ten years(although a floating dividend rate isapplied with respect to dividend payment
dates after June 2016. Dividend paymentsthat are suspended are non-cumulative.)

Fixed dividend rate for the first five years(although a floating dividend rate isapplied with respect to dividend payment
dates after June 2011. Dividend paymentsthat are suspended are non-cumulative.)

Fixed dividend rate for the first ten years(although a floating dividend rate isapplied with respect to dividend payment
dates after June 2016. Dividend paymentsthat are suspended are non-cumulative.)

Dividend payment
date

June 30th and December 30th of eachyear

June 30th of each year until June 2011,
and June 30th and December 30th of eachyear thereafterJune 30th and December 30th of eachyear

Total amount issued

US$600 million=C500 million¥400 billion

Issue date

March 13, 2006

March 13, 2006

January 12, 2007

Dividend suspension
events(Mandatory dividend suspension or
reduction event)(1) When a Liquidation Event (note 7),
Reorganization Event (note 8), Insolvency
Event (note 9) or Governmental Action (note 10)
has occurred to Mizuho Financial Group;(2) when Mizuho Financial Group's
Available Distributable Amounts (note 11) isinsufficient, or dividends on its preferredstock are suspended or reduced;(Optional dividend suspension or reduction
event)(3) when the capital adequacy ratio of
Mizuho Financial Group or its Tier 1 capitalratio fails to meet the minimum
requirement, or would fall short as a resultof the dividend payments on the MCI(USD) 1 Preferred Securities, and Mizuho
Financial Group issues a dividend
suspension notice to MCI (USD) 1; and(4) when Mizuho Financial Group fails to
pay dividends on its common stock andissues a dividend suspension notice to MCI(USD) 1.

(Mandatory dividend suspension or
reduction event)(1) When a Liquidation Event (note 7),
Reorganization Event (note 8), Insolvency
Event (note 9) or Governmental Action (note 10)
has occurred to Mizuho Financial Group;(2) when Mizuho Financial Group's
Available Distributable Amounts (note 12) isinsufficient, or dividends on its preferredstock are suspended or reduced;(Optional dividend suspension or reduction
event)(3) when the capital adequacy ratio of
Mizuho Financial Group or its Tier 1 capitalratio fails to meet the minimum
requirement, or would fall short as a resultof the dividend payments on the MCI(EUR) 1 Preferred Securities, and Mizuho
Financial Group issues a dividend
suspension notice to MCI (EUR) 1; and(4) when Mizuho Financial Group fails to
pay dividends on its common stock andissues a dividend suspension notice to MCI(EUR) 1

(Mandatory dividend suspension or
reduction event)(1) When a Liquidation Event (note 7),
Reorganization Event (note 8), Insolvency
Event (note 9) or Governmental Action (note 10)
has occurred to Mizuho Financial Group;(2) when Mizuho Financial Group's
Available Distributable Amounts (note 14) isinsufficient, or dividends on its preferredstock are suspended or reduced;(Optional dividend suspension or reduction
event)(3) when the capital adequacy ratio of
Mizuho Financial Group or its Tier 1 capitalratio fails to meet the minimum
requirement, or would fall short as a resultof the dividend payments on the MCI (JPY)
1 Preferred Securities and when Mizuho
Financial Group issues a dividend
suspension notice to MCI (JPY) 1; and(4) when Mizuho Financial Group fails to
pay dividends on its common stock andissues a dividend suspension notice to MCI(JPY) 1

Mandatory
dividend event

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, dividend payments
for the full amount of MCI (USD) 1
Preferred Securities must be made on thedividend payment dates during thesubsequent fiscal year; provided thatno event for the mandatory suspension or
reduction of dividends has occurred andthat no dividend suspension notice has
been issued in conjunction with theoccurrence of an optional dividend
suspension or reduction event.

If Mizuho Financial Group pays any
dividends on its common stock withrespect to a fiscal year, dividend payments
for the full amount of MCI (EUR) 1
Preferred Securities must be made on
dividend payment dates during thesubsequent fiscal year; provided that no
event for the mandatory suspension or
reduction of dividends has occurred andthat no dividend suspension notice has
been issued in conjunction with theoccurrence of an optional dividend
suspension or reduction event.

If Mizuho Financial Group pays any
dividends on its common stock to holdersof record as of a prescribed record date in
the immediately preceding fiscal year,
dividend payments for the full amount of
MCI (JPY) 1 Preferred Securities must be
made on dividend payment dates during
the subsequent fiscal year; provided thatno event for the mandatory suspension or
reduction of dividends has occurred andthat no dividend suspension notice has
been issued in conjunction with theoccurrence of an optional dividend
suspension or reduction event.

Distributableamounts limitation

Dividends for the MCI (USD) 1 preferred
securities are paid to the extent of Mizuho
Financial Group's Available Distributable
Amounts (note 11).

Dividends for the MCI (EUR) 1 preferred
securities are paid to the extent of Mizuho
Financial Group's Available Distributable
Amounts (note 12).

Dividends for the MCI (JPY) 1 preferred
securities are paid to the extent of Mizuho
Financial Group's Available Distributable
Amounts (note 14).

Dividend limitations

When dividends on Mizuho Financial
Group's Preferred Stock (note 13) are reduced,
dividends on MCI (USD) 1 Preferred
Securities are also reduced by an equal
percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 13) are reduced,
dividends on MCI (EUR) 1 Preferred
Securities are also reduced by an equal
percentage.

When dividends on Mizuho Financial
Group's Preferred Stock (note 13) are reduced,
dividends on MCI (JPY) 1 Preferred
securities are also reduced by an equal
percentage.

Claims for residual
assetsSame priority as Mizuho Financial Group's
Preferred Stock (note 13)

Same priority as Mizuho Financial Group's
Preferred Stock (note 13)

Same priority as Mizuho Financial Group's
Preferred Stock (note 13)

Notes: 1. Loss Absorption Certificate
Refers to a certificate that Mizuho Financial Group delivers to the issuer (in case of the loss absorption event set forth in clause (iv) below, the issuance thereof is at our discretion) upon any of
the following events with respect to Mizuho Financial Group: (i) liquidation event that shall be deemed to occur where a liquidation proceeding is commenced by or against Mizuho Financial
Group or a competent court in Japan shall have (a) adjudicated Mizuho Financial Group to be subject to bankruptcy proceedings or (b) approved a preparation of a reorganization plan for
abolishment of all business of Mizuho Financial Group; (ii) reorganization event that shall be deemed to occur if a competent court in Japan shall have adjudicated (a) the commencement of a181

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

corporate reorganization proceeding of Mizuho Financial Group under the Corporate Reorganization Law or (b) the commencement of a civil rehabilitation proceeding of Mizuho Financial
Group under the Civil Rehabilitation Law; (iii) governmental action that shall be deemed to occur if the government authority in Japan (a) publicly declares Mizuho Financial Group is not able
to pay its debts as they become due, (b) publicly declares Mizuho Financial Group's liabilities exceed its assets, (c) publicly declares Mizuho Financial Group to be under public management or(d) issues an order that Mizuho Financial Group be transferred to a third party; (iv) inadequate ratio event that shall be deemed to occur if capital adequacy ratio or Tier 1 capital ratio fails tomeet the minimum requirement or would fall short as a result of a dividend payment on the relevant preferred securities; (v) default event that shall be deemed to occur if Mizuho Financial
Group is not able to pay its debts as they become due or would not be able to do so as a result of a dividend payment on the relevant preferred securities; or (vi) insolvency event shall bedeemed to occur if the liabilities of Mizuho Financial Group exceeds its assets or would exceed its assets as a result of a dividend payment on the relevant preferred securities.
2. Preferred Stock
Refers to preferred stock of Mizuho Financial Group qualifying as Tier 1 capital and ranking most senior compared to other preferred stock of Mizuho Financial Group as to dividend payments.
It includes such preferred stock that are issued in the future.
3. Available Distributable Amounts
Refers to the distributable amounts calculated based on the immediately preceding fiscal year's financial statements, less the aggregate amount of dividends paid previously during the current
fiscal year and scheduled to be paid thereafter in respect of such fiscal year in respect of any Preferred Stock (provided that each interim dividend payment on Preferred Stock to be paid during
such current Fiscal Year shall be excluded in calculating Available Distributable Amounts). Notwithstanding the foregoing, if there are securities issued by a company other than Mizuho
Financial Group of which the rights to dividends and the rights at the time of liquidation, etc., are determined by reference to the financial condition and results of operation of Mizuho
Financial Group and which rank, in relation to MPC (with respect to the columns for MPC1, MPC2, MPC5, MPC6 and MPC7, “MPC” refers to MPC1, MPC2, MPC5, MPC6 and MPC7,
respectively), equal in point of subordination as the Parity Preferred Securities (“Parallel Preferred Securities”), the Available Distributable Amounts are adjusted as follows:
Available Distributable Amounts after the adjustment = Available Distributable Amounts x (Total of full dividend payment amount for Parity Preferred Securities in such fiscal year) / (Total of full
dividend payment amount for Parity Preferred Securities in such fiscal year + Total amount of full dividend payment amount for Parallel Securities in such fiscal year)
4. Distributable Amounts Limitation Certificate
Refers to a certificate issued by Mizuho Financial Group on or before the annual general meeting of shareholders to issuers if Available Distributable Amounts falls short of total dividends to be
paid on the dividend payment date, which shall set forth the Available Distributable Amounts of such fiscal year.
5. Mandatory Dividend Payment Date
Refers to a dividend payment date in June of a calendar year when a fiscal year of Mizuho Financial Group ends with respect to which it paid dividends on its common stock.
6. Parity Preferred Securities
Refers to the collective designation for preferred securities and MPC Preferred Securities issued by MPC (with respect to the columns for MPC1, MPC2, MPC5, MPC6 and MPC7, “MPC” refers
to MPC1, MPC2, MPC5, MPC6 and MPC7, respectively) which are perpetual and the dividend payment dates and the use of proceeds are the same as that of the relevant MPC Preferred
Securities (or MPC1 Preferred Securities, MPC2 Preferred Securities, MPC5 Preferred Securities, MPC6 Preferred Securities or MPC7 Preferred Securities, as the case may be). (In the case of
MPC1, for example, Parity Preferred Securities are the collective designation that includes Series A, Series B as well as other preferred securities that satisfy the above conditions if newly issued
in the future.)
7. Liquidation Event
Shall be deemed to occur where a liquidation proceeding is commenced by or against Mizuho Financial Group or a competent court in Japan shall have (i) adjudicated Mizuho Financial Groupto be subject to bankruptcy proceedings or (ii) approved a preparation of a reorganization plan for abolishment of all business of Mizuho Financial Group.
8. Reorganization Event
Shall be deemed to occur if a competent court in Japan shall have adjudicated (i) the commencement of a corporate reorganization proceeding of Mizuho Financial Group under the Corporate
Reorganization Law or (ii) the commencement of a civil rehabilitation proceeding of Mizuho Financial Group under the Civil Rehabilitation Law.
9. Insolvency Event
Shall be deemed to occur if (i) Mizuho Financial Group is not able to pay its debts as they become due or would not be able to do so as a result of a dividend payment on the relevant preferred
securities, or (ii) if the liabilities of Mizuho Financial Group exceeds its assets or would exceed its assets as a result of a dividend payment on the relevant preferred securities.
10. Governmental Action
Shall be deemed to occur if the government authority in Japan (i) publicly declares Mizuho Financial Group is not able to pay its debts as they become due, (ii) publicly declares Mizuho Financial
Group's liabilities exceed its assets, (iii) publicly declares Mizuho Financial Group to be under public management or (iv) issues an order that Mizuho Financial Group be transferred to a third
party.
11. Available Distributable Amounts for MCI (USD) 1 Preferred Securities(i) Amount available in June
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), pro-rated between the full dividend amount on MCI (USD) 1 Preferred Securities and the full dividend amount on preferred
securities that are equivalently subordinated in nature with MCI (USD) 1 Preferred Securities (“Equivalent Securities”) to which dividends are paid in whole or in part or declared to be paid onor prior to the relevant dividend payment date of MCI (USD) 1 Preferred Securities.
(ii) Amount available in December
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less (A) the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), (B) the amount of dividend payments on MCI (USD) 1 Preferred Securities made or declared to be made on or prior to thedividend payment date falling in June and (C) the dividends on Equivalent Securities paid or declared to be paid on or prior to the dividend payment date falling in June, pro-rated between full
dividends on MCI (USD) 1 Preferred Securities for the dividend payment date falling in December and full dividends on Equivalent Securities paid in whole or in part or declared to be paid fromthe day after the dividend payment date of MCI (USD) 1 Preferred Securities falling in June up to the dividend payment date falling in December.
12. Available Distributable Amounts for MCI (EUR) 1 Preferred Securities(Up to the dividend payment date falling in June 2011)
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), pro-rated between the full dividend payment amount on MCI (EUR) 1 Preferred Securities and the full dividend payment
amount on preferred securities for the then current fiscal year that are equivalently subordinated in nature with MCI (EUR) 1 Preferred Securities (“Equivalent Securities”).
(From the dividend payment date falling in December 2011)(i) Amount available in June
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), pro-rated between the full dividend payment amount on MCI (EUR) 1 Preferred Securities and the full dividend amount on
Equivalent Securities to which dividends are paid in whole or in part or declared to be paid on or prior to the relevant dividend payment date of MCI (EUR) 1 Preferred Securities.
(ii) Amount available in December
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less (A) the amount of dividend payments on
Preferred Sock(note 13) (excluding interim dividend payments), (B) the amount of dividend payments on MCI (EUR) 1 Preferred Securities made or declared to be made on or prior to thedividend payment date falling in June and (C) the dividends on Equivalent Securities paid or declared to be paid on or prior to the dividend payment date falling in June, pro-rated between full
dividends on MCI (EUR) 1 Preferred Securities for the dividend payment date falling in December and full dividends on Equivalent Securities paid in whole or in part or declared to be paid fromthe day after the dividend payment date of MCI (EUR) 1 Preferred Securities falling in June up to the dividend payment date falling in December.
13. Preferred Stocks
Refers to preferred stock of Mizuho Financial Group qualifying as Tier 1 capital and ranking most senior compared to other preferred stock of Mizuho Financial Group as to dividend payments
and claims to residual assets.
14. Available Distributable Amounts for the MCI (JPY) 1 Preferred Securities(i) Amount available in June
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), pro-rated between the full dividend amount on MCI (JPY) 1 Preferred Securities and the full dividend amount on preferred
securities that are equivalently subordinated in nature with MCI (JPY) 1 Preferred Securities (“Equivalent Securities”) to which dividends are paid in whole or in part or declared to be paid on or
prior to the relevant dividend payment date of MCI (JPY) 1 Preferred Securities.
(ii) Amount available in December
Refers to Distributable Amounts of Mizuho Financial Group calculated based on the financial statements for the immediately preceding fiscal year, less (A) the amount of dividend payments on
Preferred Stock(note 13) (excluding interim dividend payments), (B) the amount of dividend payments on MCI (JPY) 1 Preferred Securities made or declared to be made on or prior to thedividend payment date falling in June and (C) the dividends on Equivalent Securities paid or declared to be paid on or prior to the dividend payment date in June, pro-rated between full
dividends on MCI (JPY) 1 Preferred Securities for the dividend payment date falling in December and full dividends on Equivalent Securities paid in whole or in part or declared to be paid fromthe day after the dividend payment date of MCI (JPY) 1 Preferred Securities falling in June up to the dividend payment date falling in December.

182

Preferred securities issued by SPCs of Mizuho Corporate Bank, Ltd. (the “Bank”)
IssuerMizuho Preferred Capital Company L.L.C. (“MPCC,” and thepreferred securities described below is referred to as “MPCC
Preferred Securities”)

Mizuho JGB Investment L.L.C. (“MJI,” and the preferred securities
described below is referred to as “MJI Preferred Securities”)

Type of securities

Non-cumulative perpetual preferred securities

Non-cumulative perpetual preferred securities

Mandatory
redemption date

None

None

Optional
redemption

Optionally redeemable on each dividend payment date falling in orafter June 2008 (subject to prior approval from regulatory
authorities)

Optionally redeemable on each dividend payment date falling in orafter June 2008 (subject to prior approval from regulatory
authorities)

Dividends

Fixed dividend rate for the first ten years (although a floating
dividend rate is applied with respect to dividend payment dates
after June 2008. In addition, a step-up dividend rate is applied
after such date. As stated in “Dividend suspension events” below,
dividend payments that are suspended are non-cumulative.)

Fixed dividend rate for the first ten years (although a floating
dividend rate is applied with respect to dividend payment dates
after June 2008. In addition, a step-up dividend rate is applied
after such date. As stated in “Dividend suspension events” below,
dividend payments that are suspended are non-cumulative.)

Dividend payment
date

Last business day of June and December of each year

Last business day of June and December of each year

Total amount issued

US$1.0 billion

US$1.6 billion

Issue dateFebruary 23, 1998

March 16, 1998

Dividend suspension
eventsIf any of the following events arise, dividend payments are
suspended on a non-cumulative basis (except in the case of amandatory dividend event described below):(1) when the capital adequacy ratio of the Bank or its Tier 1 capitalratio fails to meet the minimum requirements and a Dividend
Suspension Notice (note 1) has been issued regarding MPCC Preferred
Securities;(2) when a liquidation proceeding of the Bank is commenced,
bankruptcy of the Bank or reorganization plan for terminating
Bank's business is approved by a competent court;(3) when dividends on the Bank's Preferred Stock (note 2) aresuspended and the Bank notifies such suspension in writing or a
Dividend Suspension Notice (note 1) is issued regarding MPCC
Preferred Securities; or(4) when dividends on the Bank's stock are completely suspended
and Dividend Suspension Notice (note 1) is issued on MPCC Preferred
Securities.

If any of the following events arise, dividend payments are
suspended on a non-cumulative basis (except in the case of amandatory dividend event described below):(1) when the capital adequacy ratio of the Bank or its Tier 1 capitalratio fails to meet the minimum requirements and a Dividend
Suspension Notice (note 1) has been issued regarding MJI Preferred
Securities;(2) when a liquidation proceeding of the Bank is commenced,
bankruptcy of the Bank or reorganization plan for terminating
Bank's business is approved by a competent court;(3) when dividends on the Bank's Preferred Stock (note 2) aresuspended and the Bank notifies such suspension in writing or a
Dividend Suspension Notice (note 1) is issued regarding MJI Preferred
Securities; or(4) when dividends on the Bank's stock are completely suspended
and Dividend Suspension Notice (note 1) is issued on MJI Preferred
Securities.

Mandatory dividend
event

If the Bank pays any dividends on any of its stock with respect to a
fiscal year, dividend payments for the full amount of MPCC
Preferred Securities must be made (except in the case described inclause (2) of dividend suspension events above) on the relevant
dividend payment dates for two consecutive Dividend Periods (note 3)
after the end of such fiscal year.

If the Bank pays any dividends on any of its stock with respect to a
fiscal year, dividend payments for the full amount of MJI Preferred
Securities must be made (except in the case described in clause (2)of dividend suspension events above) on the relevant dividend
payment dates for two consecutive Dividend Periods (note 3) after theend of such fiscal year.

Distributableamounts limitation

None

None

Dividend limitations

None

None

Claims on residual
assetsSame priority as the Bank's Preferred Stock (note 2)

Same priority as the Bank's Preferred Stock (note 2)

Notes: 1. Dividend Suspension Notice
Refers to the notice Mizuho Preferred Capital Holding Inc. (or, in the case of MJI, Mizuho JGB Investment Holdings Inc.) , the intermediate holding company of the Issuer in the United States,delivers to the Issuer ten days or more prior to a dividend payment date stating that MPCC (or MJI ) will not pay dividends on the relevant dividend payment date.
2. Bank's Preferred Stock
Refers to preferred stock of the Bank qualifying as Tier 1 capital and ranking most senior compared to other preferred stock of the Bank as to dividend payments. It includes such preferredstock that are issued in the future.
3. Dividend Period
Refers to periods commencing on the day after the last business day of June and continuing to the last business day of December and periods commencing on the day after the last business
day of December and continuing to the last business day of June.

183

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

(b) Summary of Preferred Stock
The preferred stock that has been issued as stated below is included in Tier 1 capital for purposes of Mizuho Financial Group's
consolidated capital adequacy ratio.
Eleventh Series Class XI Preferred Stock
Amount outstanding as of fiscal
year end¥943.74 billion¥36.69 billion

Preferred dividend payment

An annual dividend payment of ¥20,000 per preferredshare to holders of preferred stock in priority to dividend
payments to holders of common stock.

An annual dividend payment of ¥30,000 per preferredshare to holders of preferred stock in priority to dividend
payments to holders of common stock.

Non-cumulative clauseIn the event that all or part of the preferred dividends are
not paid during a given fiscal year, the shortfall is notaccumulated in or beyond the following fiscal year.

In the event that all or part of the preferred dividends are
not paid during a given fiscal year, the shortfall is notaccumulated in or beyond the following fiscal year.

Non-participation clauseNo distribution of surplus exceeding the preferred dividend
payment is made to holders of preferred stock.

No distribution of surplus exceeding the preferred dividend
payment is made to holders of preferred stock.

Preferred interim dividend
payment

If an interim dividend payment is made, ¥10,000 per shareis to be paid in priority to holders of common stock.

If an interim dividend payment is made, ¥15,000 per shareis to be paid in priority to holders of common stock.

Distribution of residual assets¥1,000,000 per preferred share is to be paid in priority toholders of common stock and no other distribution ofresidual assets is to be made.

¥1,000,000 per preferred share is to be paid in priority toholders of common stock and no other distribution ofresidual assets is to be made.

(note 1)

Conversion
requestConversion
periodFrom July 1, 2008 to June 30, 2016.

Initialconversion
priceMarket price of common stock on July 1, 2008 (minimum¥50,000), where market price is defined as the average ofthe daily closing prices of common stock as reported by the
Tokyo Stock Exchange for the 30 consecutive trading days
commencing on the 45th trading day prior to July 1, 2008.

n.a.

Reset ofconversion
price

On July 1 of each year from July 1, 2009 to July 1, 2015
(hereafter, “Conversion Price Reset Date”), in the event themarket price of common stock on such date is below theeffective conversion price on the day before the relevant
Conversion Price Reset Date, the reset price is to be
adjusted as of the relevant Conversion Price Reset Date tosuch market price (minimum: the higher of 60% of theinitial acquisition price and ¥50,000), where market price isdefined as the average of the daily closing prices ofcommon stock as reported by the Tokyo Stock Exchange
for the 30 consecutive trading days commencing on the
45th trading day prior to the Conversion Price Reset Date.

n.a.

Adjustment of
the conversion
price

Adjustments to the conversion price are to be made upon
the issuance or disposition of common stock at a pricelower than the market price and in other specified
circumstances.

n.a.

Number ofshares ofcommon stock
to be provided
upon
conversion

The number obtained by dividing (i) the total issue price ofthe preferred stock submitted in connection with theconversion request by the holders of such preferred stockby (ii) the conversion price.

Mandatory conversion ofpreferred stock184

Thirteenth Series Class XIII Preferred Stockn.a.

Mizuho Financial Group shall acquire on July 1, 2016 any
preferred stock in respect of which a request for conversion
has not been made by June 30, 2016 and deliver common
stock to the holder of such preferred stock. The number ofshares of common stock to be delivered is obtained by
dividing ¥1,000,000 by the average of the daily closing
prices of common stock as reported by the Tokyo Stock
Exchange for the 30 consecutive trading days commencing
on the 45th trading day prior to July 1, 2016 (minimum:¥50,000).

n.a.

n.a.

n.a.

On or after April 1, 2013, as determined by a resolution of
the general meeting of shareholders, all or a portion of thepreferred stock can be repurchased at the conversion priceset forth below.
The conversion price per share will be the sum of¥1,000,000 and the preferred dividend pro-rated for thenumber of days from the first day of the fiscal year during
which the conversion date falls; provided, however, that if
preferred interim dividends are paid, the conversion priceper share is to be reduced by the amount of such interim
dividend.

Voting rights

The holders of preferred stock shall not have voting rights
at a general meeting of shareholders; provided, however,that the holders of preferred stock may have voting rightsfrom the date of a general meeting of shareholders if a
proposal for the payment of preferred dividends is not
submitted to such general meeting of shareholders, orimmediately after the closing of a general meeting ofshareholders if a proposal on the preferred dividends isrejected at such general meeting of shareholders, until, ineither case, such time as a resolution of a general meetingof shareholders for the payment of preferred dividends isapproved.

The holders of preferred stock shall not have voting rights
at a general meeting of shareholders; provided, however,that the holders of preferred stock may have voting rightsfrom the date of a general meeting of shareholders if a
proposal for the payment of preferred dividends is not
submitted to such general meeting of shareholders, orimmediately after the closing of a general meeting ofshareholders if a proposal on the preferred dividends isrejected at such general meeting of shareholders, until, ineither case, such time as a resolution of a general meetingof shareholders for the payment of preferred dividends isapproved.

Preferential status

All classes of preferred stock rank pari passu with respect topreferred dividends, preferred interim dividends andresidual assets.

All classes of preferred stock rank pari passu with respect topreferred dividends, preferred interim dividends andresidual assets.

Conversion clauseNote: 1. Conversion of the preferred stock is conducted through the acquisition of the relevant shares of preferred stock by Mizuho Financial Group followed by the delivery of the applicable number ofshares of common stock. As such, the word “acquisition” is used in lieu of “conversion” in our articles of incorporation.

(c) Summary of Debt Capital Instruments
1. Summary
The following debt capital instruments are included in Tier 2 capital:• Perpetual subordinated debt;• Dated subordinated debt; and• Dated preferred stock.
Of the above, perpetual subordinated debt and dated subordinated debt are in the form of subordinated bonds with subordination clause (corporate bonds with subordination clause) or subordinated loans (borrowing by means of loan agreement withsubordination clause) (collectively, “Subordinated Bonds, Etc.”). Specifically, such debt capital is raised as follows:(1) Subordinated bonds offered to investors in Japan and abroad;(2) Subordinated bonds using a Euro MTN program; and(3) Subordinated loans.
The Subordinated Bonds, Etc., are issued by or loaned to Mizuho Financial Group, its banking subsidiaries or overseas consolidated SPC subsidiaries.
In each case, the above instruments are based on terms that are in accordance with relevant public notices and supervisory
guidelines of the Financial Services Agency so as to ensure eligibility as Tier 2 capital.
At present, we have no dated preferred stock outstanding.
2. Subordination clause
Subordinated Bonds, Etc., include subordination clauses pursuant to which, in the event that certain grounds for subordinationarise, payments of principal and interest on the relevant Subordinated Bonds, Etc., are ranked lower in priority compared to the
execution of obligations relating to more senior claims which are obligations other than those that rank pari passu or junior tosuch Subordinated Bonds, Etc. (concerning the rights of holders of Subordinated Bonds, Etc., that seek payment, the order of priority in receiving payments in bankruptcy proceedings is junior to subordinated bankrupt claims as set forth in the Bankruptcy
Law). As a result, senior creditors have priority over holders of Subordinated Bonds, Etc., in the event of bankruptcy, corporate
reorganization and civil rehabilitation proceedings, etc.
185

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

3. Perpetual subordinated debt
Perpetual subordinated debt is debt capital instruments with all of the following features:(1) Unsecured, fully paid and subordinated to other obligations;(2) Not redeemable or repayable, except when it is optional and the debtor anticipates that a sufficient capital adequacy ratio will
be maintained after such redemption or repayment or in connection with the raising of capital in an amount equal to or inexcess of the amount to be redeemed or repaid;(3) Applicable to absorb losses while the obligor continues to do business; and(4) Contains a provision that allows a deferred payment of interest.
4. Dated subordinated debt
Dated subordinated debt differs from perpetual subordinated debt in that it has a fixed redemption or repayment term of morethan five years.
In the case of both perpetual subordinated debt and dated subordinated debt, if a step-up in interest is provided for, the application of such step-up must be made at a time five years or more from the issue or loan date so as to prevent the interest to be
paid after step-up from being excessive, and the amount of step-up must be within the limit that the Financial Services Agency
determines in supervisory guidelines.

4. 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 the following assessment of capital adequacy in addition to adopting a suitable and effective capital adequacy monitoring structure.
Maintaining a Sufficient Capital Adequacy Ratio (BIS Standard) and Tier 1 Capital Ratio
We confirm our maintenance of a high level of financial soundness by conducting regular evaluations to examine if our risk-based
capital is adequate in qualitative as well as quantitative terms, in the light of our business plans and strategic targets to match theincrease in risk-weighted assets acquired for growth, in addition to maintaining risk-based capital that exceeds the minimum
requirements (8% under BIS standards, 4% under domestic standards).
Balancing Risk and CapitalOn the basis of the framework for allocating risk capital, after obtaining the clearest possible grasp of the group's overall risk
exposure, we endeavor to control risk so as to keep it within the range of our business capacity by means of allocating capitalthat corresponds to the amount of risk to the business groups and units of our banking subsidiaries, etc. within the bounds of ourcapital, and we conduct regular assessments to ensure that enough capital is maintained based on our risk profile. When making
these assessments, in addition to considering the effects that interest rate risk of a banking book, credit risk concentration andstress tests have on our capital, we verify whether a suitable risk-return relationship is being maintained.

186

5. Required Capital by Portfolio Classification
Billions of yen

As of March 31,

Credit Risk
Internal Ratings-based Approach
Corporate
SovereignBank
RetailResidential Mortgage
Qualifying Revolving Loans
Other Retail
Equities, etc.
PD/LGD Approach
Market-based Approach (Simple Risk Weight Method)
Market-based Approach (Internal Models Approach)Transitional Measure Applied
Regarded-method Exposure
Securitizations
OthersStandardized Approach
Sovereign
Bank
Corporate
Residential Mortgage
Securitizations
Others

EAD¥ 147,489.3
140,350.2
59,960.1
43,361.8
7,699.1
13,016.0
10,260.7345.0
2,410.2
6,550.1
910.9
147.0
—
5,492.0
1,097.2
6,394.6
2,271.0
7,139.0
2,633.8
1,731.4
2,474.5
0.0
17.4
281.7

Market Risk
Standardized Approach
Interest Rate Risk
Equities Risk
Foreign Exchange Risk
Commodities Risk
Internal Models Approach
Operational Risk (Standardized Approach)Total Required Capital (Consolidated)¥

2007
Required Capital¥

6,067.2
5,809.9
3,678.3
102.5
185.1
543.3
370.9
22.0
150.4
619.9
110.9
51.3
—
457.6
310.9
159.1
210.4
257.2
2.2
30.0
192.7
0.0
15.4
16.7

/

174.9

/
/
/
/
/

138.2
84.5
40.1
7.8
5.6

/

36.7

/

310.2

/

¥

5,663.6

Notes: 1. EAD: Exposure at default.
2. PD: Probability of default.
3. LGD: Loss given default.
4. Required capital: For credit risk, the sum of (i) 8% of credit risk-weighted assets, (ii) expected losses and (iii) deduction from capital. For
market risk, the market risk equivalent amount. For operational risk, the operational risk equivalent amount.
5. Total required capital (consolidated): 8% of the denominator of the capital adequacy ratio.

187

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Credit Risk
6. Credit Risk Management
Summary of Credit Risk Management
See pages 53 to 57 for summary of Mizuho Financial Group's credit risk management policies and procedures.
We use the foundation internal ratings-based approach to calculate credit risk-weighted assets for purposes of Basel II. However,
we exempt business units or asset classes for which calculating the amount of credit risk-weighted assets is deemed to be immaterial based on a consideration of the type of business and the degree of influence on the amount of credit risk-weighted assets
from the foundation internal ratings-based approach, and the standardized approach is applied.
In addition, the various estimates used to calculate credit risk-weighted assets, such as PD (probability of default), are used for
purposes of internal credit risk measurement and risk capital allocations. In compliance with regulations, in estimating PD, longterm averages from internal default results data to which conservative adjustments are made are used. Verifications are then performed through back testing.

Status of Portfolios to which Standardized Approach is Applied
Eligible external credit assessment institutions used for determining the risk weight for portfolios to which the standardized
approach is applied are Rating and Investment Information, Inc. (R&I) in Japan and Standard & Poor's (S&P) overseas.
We apply a 100% risk weight for all of our corporate exposure.
Summary of Our Internal Rating System
Please see pages 55 and 56 for summary of our internal rating system and ratings assignment procedures.

188

7. Credit Risk Exposure, etc.
Regarded-method exposure and securitizations exposure are excluded.

Status of Credit Risk Exposure(a) Breakdown by Geographical Area
Billions of yen

As of March 31, 2007

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
OthersExempt portion
Total

Loans, Commitments
and other non-derivative
off-balance-sheet exposures

Securities

OTC Derivatives¥ 72,435.4
15,958.0
3,043.1
1,645.0
5,811.1
49.1
4,162.1
1,247.4/¥ 88,393.5¥ 24,737.5
8,100.6483.6
6.0
4,650.2—
2,870.2
90.5/¥ 32,838.2¥ 1,721.3
2,783.6
85.1
113.0
1,032.6
0.0
1,514.5
38.2/¥ 4,505.0

OthersTotal

3,403.3
1,447.1
389.6
9.0
239.7
1.5
684.1
123.0
7,121.6¥ 11,972.1¥ 102,297.7
28,289.5
4,001.4
1,773.2
11,733.8
50.6
9,231.0
1,499.3
7,121.6¥ 137,708.9¥

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. Exposure to non-Japanese residents is included in “Overseas.”
3. “Others” include deposits, call loans, monetary claims purchased, money held in trust, foreign exchange assets and other assets.

(b) Breakdown by Industry
Billions of yen

As of March 31, 2007

Manufacturing
Construction
Real Estate
Service Industries
Wholesale and Retail
Finance and Insurance
Individuals
OthersExempt Portion
Total

Loans, Commitments
and other non-derivative
off-balance-sheet exposures¥ 14,848.0
1,901.8
7,666.6
12,752.3
8,318.4
13,495.8
12,563.8
16,846.5/¥ 88,393.5

Securities¥

4,030.5
286.4
545.7
15,097.2
986.1
3,332.2
0.0
8,559.8/¥ 32,838.2

OTC Derivatives

¥

499.8
24.3
33.8
150.8
512.4
3,022.0
0.4
261.2/¥ 4,505.0

Others

¥

327.3
4.2
70.9
103.2
499.2
3,228.3
21.9
595.2
7,121.6¥ 11,972.1

Total

¥

19,705.7
2,216.8
8,317.2
28,103.7
10,316.1
23,078.4
12,586.1
26,262.8
7,121.6¥ 137,708.9

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. “Others” include deposits, call loans, monetary claims purchased, money held in trust, foreign exchange assets and other assets.

(c) Breakdown by Residual Contractual Maturity
Billions of yen

As of March 31, 2007

Less than One Year
From One Year to Less than Three Years
From three Years to Less than Five Years
Five Years or MoreOthersExempt Portion
Total

Loans, Commitments
and other non-derivative
off-balance-sheet exposures¥ 31,495.2
12,689.4
13,494.0
21,570.3
9,144.3/¥ 88,393.5

Securities¥

7,328.9
7,008.0
3,585.1
8,870.8
6,045.1/¥ 32,838.2

OTC Derivatives

¥

273.5
2,519.6
887.0
704.4
120.2
/
¥ 4,505.0

Others¥1,938.6
90.2
27.3
34.4
2,759.8
7,121.6¥ 11,972.1

Total

¥

41,036.4
22,307.4
17,993.5
31,180.1
18,069.6
7,121.6¥ 137,708.9

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. “Others” include deposits, call loans, monetary claims purchased, money held in trust, foreign exchange assets and other assets.

189

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Status of Exposure Past Due Three Months or More or in Default(d) Breakdown by Geographical Area
Billions of yen

As of March 31, 2007

Domestic
Overseas
Asia
Central and South America
North America
Eastern Europe
Western Europe
OthersExempt Portion
Total

Loans, Commitments
and other non-derivative
off-balance-sheet exposures

Securities

OTC Derivatives

OthersTotal¥ 1,833.6
118.7
26.1
0.8
53.8
0.5
31.9
5.4
/
¥ 1,952.3¥ 65.9
0.2
0.2
0.0
—
—
—
—
/
¥ 66.1¥¥ 33.2
6.8
5.8
0.0
0.0
—
0.9
—
0.3
¥ 40.3¥ 1,940.8
125.7
32.1
0.8
53.8
0.5
32.8
5.4
0.3
¥ 2,066.8

¥

8.0
—
—
—
—
—
—
—
/
8.0

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. Exposure to non-Japanese residents is included in “Overseas.”
3. “Others” include deposits, call loans, monetary claims purchased, money held in trust, foreign exchange assets and other assets.

(e) Breakdown by Industry
Billions of yen

As of March 31, 2007

Manufacturing
Construction
Real Estate
Service Industries
Wholesale and Retail
Finance and Insurance
Individuals
OthersExempt Portion
Total

Loans, Commitments
and other non-derivative
off-balance-sheet exposures

¥

154.2
90.0
344.0
222.5
270.1
332.5
192.2
346.4
/
¥ 1,952.3

Securities

¥

5.2
13.8
0.1
1.8
28.1
8.5
—
8.3
/
¥ 66.1OTC Derivatives

Others¥¥ 12.2
0.5
0.5
6.2
8.2
6.9
1.5
3.7
0.3
¥ 40.3

¥

0.5
1.0
0.3
0.4
2.7
1.9
—
0.8
/
8.0

Total

¥

172.4
105.4
345.1
231.1
309.2
349.9
193.7
359.3
0.3
¥ 2,066.8

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. “Others” include deposits, call loans, monetary claims purchased, money held in trust, foreign exchange assets and other assets.

190

Status of Reserves for Possible Losses on Loans(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

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

2007

Balance as of March 31, 2006
Increase during the Fiscal Year
Decrease during the Fiscal Year
Balance as of March 31, 2007
Balance as of March 31, 2006
Increase during the Fiscal Year
Decrease during the Fiscal Year
Balance as of March 31, 2007

¥ 615.7
500.8
615.7
500.8
194.9
352.3
194.9
352.3

Balance as of March 31, 2006
Increase during the Fiscal Year
Decrease during the Fiscal Year
Balance as of March 31, 2007

3.4
3.1
3.4
3.1

Balance as of March 31, 2006
Increase during the Fiscal Year
Decrease during the Fiscal Year
Balance as of March 31, 2007

¥ 814.1
856.3
814.1
856.3

(g) Specific Reserve for Possible Losses on Loans by Geographical Area and Industry
Billions of yen

As of March 31,

Domestic
Manufacturing
Construction
Real Estate
Service Industries
Wholesale and Retail
Finance and Insurance
Individuals
OthersOverseas
Exempt Portion
Total

2007

¥ 332.8
15.4
3.2
11.3
16.8
21.6
178.5
64.6
20.9
15.9
3.5
¥ 352.3

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. Changes from the previous year are not presented for the fiscal year ended March 31, 2007 as it is the first year of application.

191

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

(h) Write-Offs of Loans by Industry
Billions of yen

For the Fiscal Year ended March 31,

2007

Manufacturing
Construction
Real Estate
Service Industries
Wholesale and Retail
Finance and Insurance
Individuals
OthersExempt portion
Total

¥

7.7
1.4
0.6
11.7
20.9
5.7
5.6
13.0
0.2
¥ 67.1

Notes: 1. Exempt portion represents amounts calculated using the standardized approach for business units and asset classes that are immaterial for
purposes of calculating credit risk-weighted assets.
2. “Others” include overseas and non-Japanese resident portions.

Status of Exposure to which Standardized Approach is Applied(i) Exposure by Risk Weight Category after Applying Credit Risk Mitigation
Billions of yen

As of March 31,

Risk Weight

Off-balance Sheet

2007
Total

758.1
0.6
538.6
0.0
85.5
2,086.2
0.0—¥ 1,875.2
0.1
1,148.9
—
0.5
627.2
—
—

¥ 2,633.4
0.8
1,687.6
0.0
86.1
2,713.4
0.0—¥ 3,469.4¥ 3,652.2¥ 7,121.6

On-balance Sheet

0%
10%
20%
35%
50%
100%
150%
350%

Total

¥

Note: Off-balance sheet exposure shows the amount of credit equivalent.

(j) Deduction from CapitalBillions of yen

As of March 31,

Deduction from Capital

192

2007

¥ 15.4

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

As of March 31,

Risk Weight

2007

50%
70%
90%
95%
115%
120%
140%
250%

¥

Total

173.8
484.1
303.3
29.8
94.2
11.4
10.1
320.8

¥ 1,428.0(l) Equities Exposure under Simple Risk Weight Method by Risk Weight Category
Billions of yen

As of March 31,

Risk Weight

2007

300%
400%

Total

¥

78.2
68.7

¥

147.0

Note: Of the equities exposure under the simple risk weight method, 300% risk weight is applied for listed equities and 400% for unlisted equities.

(m) Portfolio by Asset Class and Ratings Segment (Corporate)
Billions of yen

PD(EAD Weighted
Average) (%)

LGD(EAD Weighted
Average) (%)

Risk Weight(EAD Weighted
Average) (%)

EAD

On-balance
Sheet

Off-balance
Sheet

Corporate
Investment Grade Zone
Non-investment Grade Zone
Default

3.97%
0.12
1.80
100.0043.49%
43.93
42.77
46.21

51.99%
32.64
79.23
0.00

¥ 58,532.0
31,116.6
25,590.7
1,824.7¥ 44,137.4
20,510.1
21,878.2
1,749.0¥ 14,394.6
10,606.4
3,712.5
75.6

Sovereign
Investment Grade Zone
Non-investment Grade Zone
Default

0.03
0.01
2.10
100.00

44.99
44.99
44.99
45.00

2.80
2.48
86.73
0.00

43,361.8
43,195.0
161.9
4.8

34,993.7
34,838.8
149.9
4.8

8,368.1
8,356.1
11.9
0.0

Bank
Investment Grade Zone
Non-investment Grade Zone
Default

0.21
0.13
0.94
100.00

43.76
43.81
41.81
45.00

29.02
28.05
61.90
0.00

7,699.1
7,470.5
224.4
4.1

3,207.5
3,019.7
183.5
4.1

4,491.5
4,450.7
40.8—

Equities exposure under PD/LGD approach
Investment Grade Zone
Non-investment Grade Zone
Default

2.46
0.12
4.62
100.00

90.00
90.00
90.00
90.00

124.66121.16305.54
0.00

910.9
860.5
30.4
19.9

910.9
860.5
30.4
19.9

—
—
—
—

Total
Investment Grade Zone
Non-investment Grade Zone
Default

2.15%
0.06
1.80
100.0044.48%
44.95
42.83
46.68

31.69%
17.38
79.39
0.00

¥ 110,504.0
82,642.7
26,007.4
1,853.7¥ 83,249.7
59,229.3
22,242.2
1,778.1¥ 27,254.3
23,413.4
3,765.2
75.6

As of March 31, 2007

Notes: 1. Investment grade zone includes obligor ratings A1 to B2, non-investment grade zone includes C1 to E2 (excluding E2R), and default
includes E2R to H1 (See page 55 for details regarding obligor ratings).
2. “Corporate” does not include specialized lending exposure under supervisory slotting criteria.

193

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

(n) Portfolio by Asset Class and Ratings Segment (Retail)Billions of yen

As of March 31, 2007

PD
(EAD
Weighted
Average)
(%)

LGD
(EAD
Weighted
Average)(%)

EL Default Risk Weight
(EAD
(EAD
Weighted
Weighted
Average)
Average)(%)(%)

Residential Mortgage
Non-default
Default

1.53%
0.85
100.0047.86%
47.81
56.13

0.36%
.—
52.73

35.65% ¥ 10,260.7 ¥ 10,181.4
35.59
10,190.8 10,147.8
45.01
69.8
33.6

Qualifying Revolving
Loans (Retail)Non-default
Default

2.87
2.46
100.00

73.36
73.33
79.85

0.32
.—
75.98

53.38
53.39
51.22

345.0
343.5
1.4

240.7
239.5
1.2

Other RetailNon-default
Default

4.04
1.63
100.00

49.17
48.39
59.21

1.37
.—
55.68

50.53
50.62
46.87

2,410.2
2,351.0
59.2

Total
Non-default
Default

2.03%
1.04
100.0048.14%
48.59
3.47

0.54%
.—
54.33

EAD

AmountofOn-balance Off-balance
Undrawn
Sheet
Sheet Commitments

¥

79.2
43.0
36.2

¥

Weighted
Averageof CCF
(%)

—
—
—

—%
—%
—%

104.2
104.0
0.2

1,409.8
1,408.0
1.7

7.37%
7.36%
13.27%

2,345.4
2,286.6
58.7

64.7
64.3
0.4

68.2
67.6
0.5

77.79%
77.75%
82.08%

38.88% ¥ 13,016.0 ¥ 12,767.7
38.81
12,885.5 12,674.0
45.92
130.5
93.6

¥ 248.3
211.4
36.9¥ 1,478.0
1,475.7
2.3

10.62%
10.59%
28.98%(o) Actual Losses by Asset Class
Billions of yen

For the Fiscal Year ended March 31,

2007
Actual Losses

Asset Class:Corporate, Bank, Sovereign
Residential Mortgage
Qualifying Revolving Loans (Retail)
Other Retail¥ 1,131.3
110.5
4.9
63.1

Total

¥ 1,309.9

Notes: 1. Actual losses are the sum of tax-qualified direct write-offs, losses from sales of nonperforming loans, losses from loan forgiveness, losses
from debt-equity swaps, partial direct write-offs during the fiscal year, as well as specific reserves for possible losses on loans and generalreserves for possible losses on loans (for claims for special attention only) as of the end of the fiscal year.
2. With respect to actual losses by asset class, accumulation began from the fiscal year ended March 31, 2007.

(p) Comparison of Estimated and Actual Losses by Asset Class
Billions of yen

For the Fiscal Year ended March 31,

Asset Class:Corporate, Bank, Sovereign
Residential Mortgage
Qualifying Revolving Loans (Retail)
Other Retail
Total

Estimated Losses

2007
Actual Losses¥ 1,097.9
78.2
7.2
52.9

¥ 1,131.3
110.5
4.9
63.1

¥ 1,236.5¥ 1,309.9

Notes: 1. Estimated losses are expected losses as of March 31, 2007.
2. We began estimating expected losses by asset class from March 31, 2007.
3. Actual losses are the sum of tax-qualified direct write-offs, losses from sales of nonperforming loans, losses from loan forgiveness, losses
from debt-equity swaps, partial direct write-offs during the fiscal year, as well as specific reserves for possible losses on loans and generalreserves for possible losses on loans (for claims for special attention only) as of the end of the fiscal year.
4. With respect to actual losses by asset class, accumulation began from the fiscal year ended March 31, 2007.

194

Methods for Credit Risk Mitigation
8. Risk Management Regarding Credit Risk Mitigation
We obtain collateral and guarantees as a means of securing credit. In obtaining the collateral and guarantees, we evaluate the valueof the collateral, guarantee performance capability and legal enforceability, and we also conduct regular subsequent re-evaluations.
Furthermore, we monitor the state of concentration of collateral by type and concentrations of risk in individual companies, taking
into account indirect credit exposure such as guarantees.
When calculating the credit risk-weighted assets for capital adequacy ratio regulations, the effect of credit risk mitigation througheligible collateral and guarantees is reflected pursuant to the Notice.
In addition, when calculating the credit risk-weighted assets for corporate exposure, after considering the relevant maturity andother factors pursuant to the Notice, we offset debt claims with deposits to the extent such offsetting is legally possible.
When calculating the credit risk-weighted assets for derivative transactions and repurchase transactions, in cases in which a bilateral netting contract is valid in light of the legal system of the relevant jurisdiction, we take its effect into consideration.

9. Credit Risk Mitigation by Portfolio Classification
The amounts of exposure after taking into consideration the effect of credit risk mitigation through collateral and guarantees are as
follows:
Billions of yen

As of March 31, 2007

Internal Ratings-based Approach
Corporate
SovereignBank
RetailResidential Mortgage
Qualifying Revolving Loans
Other Retail
OthersStandardized Approach
Sovereign
Bank
Corporate
Residential Mortgage
Securitizations
OthersTotal

Eligible
Financial Collateral

Other Eligible
IRB Collateral

Guarantees

CreditDerivatives¥ 2,818.3
2,261.0
0.2
516.9
40.1
—
—
40.1
—

¥ 4,477.4
4,326.2
26.2
4.2
120.6
—
—
120.6
—

Total

¥ 2,941.2
1,543.0
474.4
60.5
863.1
363.8
4.7
494.5
—

¥ 505.0
505.0
—
—
—
—
—
—
—

¥ 10,742.1
8,635.4
501.0
581.7
1,023.9
363.8
4.7
655.3
—

1,470.0
1,451.2
3.1
15.6
—
—
0.0

/
/
/
/
/
/
/

66.7
—
2.7
64.0
—
—
—

8.3
—
5.9
0.4
—
1.9
—

1,545.2
1,451.2
11.8
80.1
—
1.9
0.0

¥ 4,288.4¥ 4,477.4¥ 3,008.0¥ 513.4¥ 12,287.3

195

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Counterparty Risk in Derivatives Transactions
10. Management of Counterparty Risk in Derivatives Transactions
A summary of policies and procedures for risk management regarding counterparty risk for derivatives transactions is found on
page 146 to 147.

11. Status of Counterparty Risk in Derivatives Transactions(a) Status of Derivatives Transactions
Billions of yen

As of March 31,

Gross
Replacement
Cost

Gross
Add-on2007
CreditEquivalent
AmountForeign Exchange-related Transactions
Interest-related Transactions
Gold-related Transactions
Equity-related Transactions
Transactions related to Precious Metals (Other than Gold)
Other Commodity-related Transactions
Credit Derivatives Transactions
Credit Equivalent of Mitigation Effect of Close-out Netting Contracts
Effect of Credit Risk Mitigation by CollateralTotal¥ 1,843.5
4,810.3
0.1
100.8
—
163.4
17.2
/
/
/

¥ 2,329.5
4,607.6
0.0
67.1
0.0
122.8
464.1
/
/
/

¥ 4,173.1
9,418.0
0.2
167.9
0.0
286.3
481.3
9,061.9
150.0¥ 5,315.1

Note: The current exposure method is used as the method of calculating credit equivalent amounts.

(b) Amounts of Credit Risk Mitigation by Type
Billions of yen

As of March 31,

2007

Eligible Financial Collateral
Other Eligible IRB Collateral
Guarantees, Others
Total

¥

¥

55.3
46.2
10.3
111.8

(c) Notional Amount of Credit Derivatives Subject to Credit Equivalent Amount Calculations
Billions of yen

2007
Notional Amount

As of March 31,

Credit Derivatives Type:
Credit Default Swap

BoughtSold¥ 6,309.7
5,144.6

Total Return Swap

BoughtSold——

BoughtSold¥ 6,309.7
5,144.6

Total

Note: Credit derivatives used for credit risk mitigation are as follows:
Billions of yen

As of March 31,

Credit Derivatives Used for Credit Risk Mitigation

196

2007

¥

661.0

Securitization Exposure
12. Summary of Securitization Exposure and Its Risk Management
We are associated with securitization transactions from various perspectives and positions.

(a) Securitization of Our Assets (“Securitization as Originator”)
As a means of correcting credit concentration and controlling economic capital, we engage in the securitization of our assets.
When conducting a securitization as originator, we make judgments on the effects of reduction of economic capital and improvement of risk-return relationships as well as the practical effects of risk transfers.
(b) Securitization of Assets of Customers (“Secuitization Program Arrangements”)
We undertake various securitization program arrangements such as asset-backed loan (“ABL”), asset-backed commercial paper(“ABCP”) and trust schemes, etc., as a means of financing for our customers. We endeavor to understand the actual risk profileof the underlying assets and appropriately disclose the risks and terms of the program to the investing customer.
(c) Securitization Program (ABL/ABCP) Sponsor
When arranging a securitization program, there are cases in which we retain securitization exposure by providing the ABL, or providing an ABCP backup line, as sponsor. In such cases, in addition to gaining a firm understanding of actual risk through due diligence from the viewpoint of an investor, we apply internal ratings and make evaluations by assessing such transactions andcarefully managing the involvement together with other direct loan assets.
(d) Investment in Alternative Credit Risk-Weighted Assets (“Securitization Transaction as Investor”)
We maintain securitization exposure as investments in alternative credit risk-weighted assets that differ from conventional credit
from the perspective of investment diversification. The Portfolio Management Committee establishes investment limits for securitization transactions as investor, and we maintain a strict managing structure for such transactions.
(e) Others
In addition, we act as servicer for securitization transactions, provide settlement account facilities (servicer cash advance) and provide interest rate swaps to securitization vehicles.
We conduct credit risk measurements and carry out periodical monitoring of securitization transactions and report results to
the Portfolio Management Committee.

Status of Response to Basel II
The methods used to calculate the credit risk-weighted assets under the internal ratings-based approach with respect to securitization exposure are the ratings-based approach (RBA) and the supervisory formula (SF).
Also, the eligible external credit assessment institutions used in determining securitization exposure risk weight are Rating andInvestment Information, Inc. (R&I), Japan Credit Rating Agency, Ltd. (JCR), Moody's Investors Service (Moody's), Standard & Poor's(S&P), and Fitch Ratings, Ltd. (We do not separately designate eligible external credit assessment institutions for each type of securitization exposure.)

13. Accounting Policies for Securitization Transactions
The recognition of the generation and termination of financial assets and liabilities relating to securitization transactions, theirevaluation and accounting treatment are pursuant to Business Accounting Standards No.10, “Accounting Standards Relating to
Financial Products” (Business Accounting Deliberation Council, January 22, 1999).

197

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

14. Quantitative Disclosure Items for Securitization Exposure
Securitization as Originator(a) Information of Underlying Asset
Billions of yen

As of March 31, 2007
For the Fiscal Year ended March 31, 2007*

CreditResidential
Cards Mortgage Loans

Conventional Securitizations
Amount of Underlying Asset
Default Exposure

¥

—
—

¥

375.2
1.9

Auto
Loans

¥

—
—

Others

¥

58.2
1.7

Total

¥

433.5
3.6

Losses during the Fiscal Year*

—

—

—

—

—

Amount of Exposures Securitized during the Fiscal Year*

—

—

—

14.3

14.3

Gains and Losses Recognized on Sales during the Fiscal Year*

—

—

—

—

—

Securitization Subject to the Early Amortization Treatment

—

—

—

—

—

—
—

—
—

—
—

863.1
—

863.1
—

Exposure related to Synthetic Securitizations
Amount of Underlying Asset
Default Exposure
Losses during the Fiscal Year*—

Amount of Exposures Securitized during the Fiscal Year*

¥

—

—
¥

—

¥

—

—

—

—

¥ 900.2¥ 900.2

Note: “Default exposure” and “losses during the fiscal year” are stated on the basis of the definitions of default applicable to the relevanttransactions.

(b) Information of Securitization Exposure Retained or Purchased
Exposure by Risk Weight Category and Underlying Asset Type and Amount of Required CapitalBillions of yen

CreditResidential
Cards Mortgage Loans

As of March 31, 2007

Risk Weight

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%¥

Deduction from Capital
Total

—
—
—
—
—
—

¥

—
¥

—

Auto
Loans

Others

Total

—
—
—
—
—
—

¥ 734.4
—
—
102.5
18.0
—

¥ 734.4
—
—
147.5
18.0
—

—

13.3

13.3

—

¥ 868.3¥ 913.4

CreditResidential
Cards Mortgage Loans

Auto
Loans

—
—
—
45.0
—
—

¥

0.0
¥

45.0

¥

Required
Capital

¥

4.4
—
—
11.1
0.3
—
11.1

¥

26.9

Capital Increase Due to Securitization Transactions
Billions of yen

As of March 31, 2007

Capital Increase due to Securitization Transactions

¥

—

¥

10.9

¥

—

Others

¥

—

Total

¥

10.9

Credit Risk-Weighted Assets Calculated Pursuant to Article 15 of Supplementary Provisions of the FSA Capital
Adequacy Ratio Notice
Billions of yen

As of March 31,

Credit Risk-weighted Assets Calculated Pursuant to Article 15 ofSupplementary Provisions of the FSA Capital Adequacy Ratio Notice

198

2007

¥

—

Securitization Exposure as Sponsor of Securitization Programs (ABCP/ABL)(c) Information by Type of Underlying Asset
Billions of yen

As of March 31, 2007
For the Fiscal Year ended March 31, 2007*

CreditResidential
Cards Mortgage Loans

Amount of Underlying Asset
Default Exposure

¥

238.1
—

¥

176.7

Estimated Loss Amount related to Underlying Assets*

¥

16.9

Amount of Exposures Securitized during the Fiscal Year*

¥

—
—

Auto
Loans

¥

72.0
—

¥

Others

Total

967.7
23.9

¥ 1,278.0
23.9

—

0.2

17.0

34.3

—

¥ 242.5¥ 5,193.3¥ 5,612.6

Notes: 1. Securitization exposure that is acquired in the securitization of the customer's claims other than as the sponsor (in the form of assetbacked securities, trust beneficiary rights and other transferable instruments) is categorized as securitization exposure as investor.
2. The amount of default exposure is the amount recognized as default in the calculation of capital adequacy ratio.
3. Estimated loss amount related to underlying assets is based on the exposure as of the relevant date and the parameters used in thecalculation of capital adequacy ratio. We generally hold the senior portion of the securitization, and we incurred no losses related to our
securitization exposure shown above in the fiscal year ended March 31, 2007.

(d) Information of Securitization Exposure Retained or Purchased
Exposure by Risk Weight Category and Underlying Asset Type and Amount of Required CapitalBillions of yen

CreditResidential
Cards Mortgage Loans

As of March 31, 2007

Risk Weight

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%

¥

2.3
90.3
—
184.2
—
0.8

¥

277.7

Deduction from Capital
Total

¥

—

—
—
—
—
—
—

Auto
Loans

¥

24.7
—
40.2
—
—
—

¥

65.0

—
¥

—

Others

¥

607.5
133.4
139.2
28.6
0.1
—

¥

908.9

—

Required
Capital

Total

¥

634.5
223.7
179.4
212.9
0.1
0.8

¥

1,251.7

—

¥

4.5
7.7
11.6
23.1
0.0
0.5

¥

47.6

—

—

Credit Risk-Weighted Assets Calculated Pursuant to Article 15 of Supplementary Provisions of the FSA Capital
Adequacy Ratio Notice
Billions of yen

As of March 31,

Credit Risk-weighted Assets Calculated Pursuant to Article 15 of Supplementary
Provisions of the FSA Capital Adequacy Ratio Notice

2007

¥

—

199

Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

Securitization Exposure as Investor(e) Information of Securitization Exposure Retained or Purchased
Exposure by Risk Weight Category and Underlying Asset Type and Amount of Required CapitalBillions of yen

CreditResidential
Cards Mortgage Loans

As of March 31, 2007

Risk Weight

Up to 20%
Up to 50%
Up to 100%
Up to 250%
Up to 650%
Over 650%

Deduction from Capital
Total

¥

122.2
2.3
198.2
—
—
—

¥ 1,594.7
9.7
16.7
—
—
—

¥

Auto
Loans

Others

Total

285.2
—
0.1
—
—
—

¥ 1,712.3
195.4
46.4
2.9
23.6
—

¥ 3,714.5
207.5
261.6
2.9
23.6
—

Required
Capital

¥

36.0
5.5
16.8
0.2
8.7
—

4.3

—

—

37.2

41.6

41.3

¥ 327.2¥ 1,621.1¥ 285.4¥ 2,018.0¥ 4,251.9¥ 108.7

Note: Subordinated contributions for managed collateralized loan obligations (“CLO”) are disclosed in the above table as exposure as investor evenwhen the assets underlying the CLO include exposures that were originated by us. Our subordinated contributions for managed CLO were
¥6.3 billion (treated as deduction from capital for purposes of capital adequacy ratio calculation), and our sale of assets to such managed
CLOs, etc., during the fiscal year was ¥105.9 billion.

Credit Risk-Weighted Assets Calculated Pursuant to Article 15 of Supplementary Provisions of the FSA Capital
Adequacy Ratio Notice
Billions of yen

As of March 31,

Credit Risk-weighted Assets Calculated Pursuant to Article 15 of Supplementary
Provisions of the FSA Capital Adequacy Ratio Notice

2007

¥

—

Note that, in addition to the above, within the provision of credit in the form of eligible servicer cash advance, set forth in Article
246 of the Notice, there was an undrawn portion to which no required capital is allocated.
The balance of such portion as of March 31, 2007 was ¥40.7 billion.

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Market Risk
See pages 58 to 62 for information regarding market risk.

Operational Risk
See pages 62 to 63 for information regarding operational risk.

Equities Exposure
15. Risk Management Related to Equities ExposureWith regard to equities in our banking account, we manage default risk through our credit risk management structure and pricefluctuation risk through our market risk management structure.
The valuation of Japanese stocks with a quoted market price is determined based on the average quoted market price over themonth preceding the consolidated balance sheet date. Valuation of equities other than Japanese stocks is determined at thequoted market price if available, or otherwise based on their reasonable value at the consolidated balance sheet date.

16. Status of Equities Exposure(a) Amounts Stated in Consolidated Balance Sheet
Billions of yen

As of March 31,

Consolidated Balance Sheet Amount2007
Market Value¥ 6,063.1
363.2¥ 6,063.1
363.2¥ 6,426.3¥ 6,426.3

Exposure of Listed Stock, etc.
Other Equities Exposure
Total
Note: Above figures include only Japanese and foreign stocks.

(b) Gains and Losses on Sales Related to Equities Exposure
Billions of yen

2007
For the Fiscal Year ended March 31,

Sale of Equities Exposure

Gains and Losses
on SalesGains on Sales

Losses on Sales¥ 225.8¥ 231.2¥ 5.3

Note: Above figures are gains and losses on sales of stocks within other ordinary income and expenses in our consolidated statement of income.

(c) Income and Losses from Write-Offs Related to Equities Exposure
Billions of yen

For the Fiscal Year ended March 31,

2007
Gains and Losses from Write-offs

Write-offs of Equities Exposure¥ (335.7)

Note: Above figure is losses on devaluation of stocks within other expenses in our consolidated statement of income.

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Status of Capital Adequacy

Status of Consolidated Capital Adequacy of Mizuho Financial Group, Inc.

(d) Unrealized Gains and Losses Recognized in the Consolidated Balance Sheet and Not Recognized in theConsolidated Statement of Income
Billions of yen

2007

As of March 31,

Equities exposure

Net Unrealized
Gains

Unrealized
Gains

Unrealized
Losses¥ 2,711.4¥ 2,759.7¥ 48.3

Note: 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
None.

(f) Equities Exposure by Portfolio Classification
Billions of yen

As of March 31,

PD/LGD Approach
Market-based Method (Simple Risk Weight Method)
Market-based Method (Internal Models Approach)Transitional Measure Applied
Total

202

2007

¥

910.9
147.0
—
5,492.0¥ 6,550.1

Investor Information

Date of Establishment(Preferred Stock)
Percentageof shares
outstanding
Shares held(%)

January 8, 2003

Paid-in Capital¥1,540,965 million

The Dai-ichi Mutual Life Insurance
Company

27,0002.75

Outstanding Shares

Meiji Yasuda Life Insurance Company

25,0002.54

12,852,625.49 shares
Common Stock: 11,872,195.49 shares
Preferred Stock:980,430 shares

Sompo Japan Insurance Inc.

19,000

1.93

UBS AG LONDON A/C IPB NON SEG
ACCOUNT (Standing proxy agent:
Citi Bank N.A.)

15,770

1.60

Number of Shareholders

FUKOKU MUTUAL LIFE INSURANCECOMPANY

15,0001.52

Marubeni Corporation

14,5001.47

ITOCHU Corporation

10,0001.01

The Kansai Electric Power Company,
Incorporated

10,0001.01

Common Stock:
Preferred Stock:319,698
3,223

Major Shareholders(Common Stock)
Percentageof shares
outstanding
Shares held(%)

Shiseido Company, Limited

10,0001.01

SHIMIZU CORPORATION

10,000

1.01

SEIKO EPSON CORPORATION

10,000

1.01

Japan Trustee Services Bank, Ltd.
(Trustee account)

618,108.00

5.20

The Master Trust Bank of Japan, Ltd.
(Trustee account)

TAISEI CORPORATION

10,0001.01

571,497.00

4.81

Electric Power Development Co., Ltd.

10,0001.01

2.52

The Tokyo Electric Power Company,
Incorporated

10,0001.01

NIPPON EXPRESS CO., LTD.

10,000

1.01

Japan Trustee Services Bank, Ltd.
(Trustee account 4)299,199.00

The Dai-ichi Mutual Life Insurance
Company

279,158.00

2.35

Mizuho Financial Strategy Co., Ltd.

261,040.83

2.19

THE CHASE MANHATTAN BANK,
N. A. LONDON(Standing proxy agent:Mizuho Corporate Bank, Ltd.)

Note: The numbers of Preferred Stock above are the total shares of theEleventh Series Class XI and Thirteenth Series Class XIII Preferred Stock.
(As of March 31, 2007)

245,820.00

2.07

Trust & Custody Services Bank, Ltd.
(Meiji Yasuda Life Insurance Company
Retirement Benefit Trust Accountre-entrusted by Mizuho Trust &Banking Co., Ltd.)
137,000.00

1.15

Nippon Life Insurance Company

132,630.76

1.11

STATE STREET BANK AND TRUSTCOMPANY(Standing proxy agent:Mizuho Corporate Bank, Ltd.)

128,499.00

1.08

STATE STREET BANK AND TRUSTCOMPANY 505103(Standing proxy agent:Mizuho Corporate Bank, Ltd.)

120,330.00

1.01

Note: The voting rights of the shares held by Mizuho Financial Strategy Co.,
Ltd. are restricted, pursuant to Article 308 Paragraph 1 of the Company
Law of Japan and Article 67 of Enforcement Order for the Company
Law of Japan. In addition, on May 28 2007, we repurchased and cancelled 261,040.83 shares of our common stock held by Mizuho
Financial Strategy.

203

Investor Information

Stock Listings(Common Stock)
Tokyo Stock Exchange
Osaka Securities Exchange

Accounting Auditors
Ernst & Young ShinNihon

Shareholder Register Manager
Mizuho Trust & Banking Co., Ltd.

Fiscal Year
April 1 to March 31

Convocation of General Meetings of Shareholders
An ordinary general meeting of shareholders of theCompany shall be convened no later than 3 months fromthe last day of each business year and an extraordinary
general meeting of shareholders shall be convened whenever necessary.

Record Date
1. The Company shall deem shareholders having voting
rights appearing in writing or electronically in the registerof shareholders (including the register of beneficial shareholders; the same shall apply hereinafter) as of the end of
March 31 of each year as the shareholders who are entitled to exercise their rights at the ordinary general meeting of shareholders for the relevant business year.
2. In addition to the preceding paragraph, the Company
may temporarily set the record date whenever necessary,by a resolution of the Board of Directors and upon givinga prior public notice thereof.

Dividends from Surplus Approved by Resolution of
Ordinary General Meeting of Shareholders
Dividends from the surplus approved by a resolution of an
ordinary general meeting of shareholders shall be distributed to the shareholders or registered stock pledgees
appearing in writing or electronically in the register ofshareholders as of the end of March 31 of each year or tothe holders of fractional share appearing in writing or electronically in the register of fractional share as of the end of
March 31 of each year.

Interim Dividends
The Company may, by a resolution of the Board of
Directors, distribute interim dividends provided for in Article
454, Paragraph 5 of the Company Law of Japan to theshareholders or registered stock pledgees appearing in writing or electronically in the register of shareholders as of theend of September 30 of each year or to the holders of fractional share appearing in writing or electronically in the register of fractional share as of the end of September 30 ofeach year.
204

(ADR)
New York Stock Exchange
Note: We listed our ADRs on the New York Stock Exchange on November
8, 2006

ADR* Information
Outline of Mizuho Financial Group's ADR
1. Type of ADR Program : Sponsored Level 2 Program**
2. Conversion ratio :500 ADRs = 1 common share
3. Depositary bank :The Bank of New York
4. Local custodian bank : Mizuho Corporate Bank, Ltd.
* ADRs are securities issued for the purpose of trading in the U.S. in placeof the underlying stock of foreign companies. As ADRs are registeredwith the SEC as U.S. securities, they are traded, settled and held incustody in substantively the same manner as the stocks of U.S.
companies. ADR is an acronym for American Depositary Receipts.
** For sponsored ADRs, the company issuing the underlying stock enters
into a deposit agreement with a specific depositary bank, and ADRs areissued by the depositary bank once the issuer, depositary bank andinvestor rights and obligations have been clarified. In contrast,
unsponsored ADRs are issued by the depositary bank based on investor
demand without any involvement by the company issuing theunderlying stock. Sponsored ADR Programs are divided into Levels 1, 2
or 3 depending on whether the issuance or sale of new stock is involved
and the level of disclosure the company is obligated to provide. Under aLevel 2 program, ADRs may be issued and listed on U.S. stock
exchanges without being accompanied by the issuance or sale of new
stock, and the issuer of the underlying stock is required to disclose
information in a similar manner as U.S. listed companies.

Disclosure Policy

Basic Principles
We aim to win the highest regard of our shareholders andthe market and to earn the trust of society as Japan's leading comprehensive financial services group. For this reason,
we place one of the highest management priorities on continuing to disclose information to our customers, shareholders, and investors both in and outside Japan in a fair, timely
and appropriate manner, in order that they may form
proper judgments and appraisals of the group. To achieve
this aim, we observe applicable domestic and internationallaws and regulations as well as stock exchange rules relating to corporate disclosure, and we establish and implement appropriate Disclosure Controls and Procedures.

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
and regulations as well as stock exchange rules and to
implement fair, timely and appropriate corporate disclosure. The Disclosure Controls and Procedures are theprocess carried out by directors, officers and employeesof Mizuho Financial Group and include internal controls
designed to provide reasonable assurance regarding thereliability of Financial Reporting and the Preparation of
Financial Statements. We have established the basic
principles underlying our Disclosure Controls andProcedures as well as our internal rules related toDisclosure Controls and Procedures that govern the
management framework for the entire Mizuho Financial
Group including group companies, and we endeavor toestablish, implement and continuously improve ourDisclosure Controls and Procedures. Our Disclosure
Committee is the principal management body that is
responsible for discussing and exploring matters relating
to Disclosure Controls and Procedures.
(2) Evaluation of Effectiveness of Disclosure Controls
and Procedures
Our Disclosure Controls and Procedures are documented, and evaluation of the overall effectiveness of
our Disclosure Controls and Procedures is conducted
regularly by reviewing the contents of such documentation and their implementation. In addition, evaluation of
the effectiveness and appropriateness of Disclosure
Controls and Procedures is 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 infinancial reporting, accounting or disclosure. We havealso developed the “Internal Controls and Audit
Hotline”, a system designed for obtaining concerns

regarding questionable accounting or auditing mattersfrom both inside and outside Mizuho Financial Group.

Disclosure Methods, Other(1) Disclosure Methods
With respect to the information which is required to bedisclosed pursuant to applicable domestic and international laws and regulations as well as stock exchange
rules, we follow the defined disclosure procedures suchas publishing such information in business reports (JigyoHokoku), annual securities reports (YukashokenHokokusho) and other disclosure publications, as well as
providing such information through the information distribution systems of domestic and international stock
exchanges and through press releases. We alsoendeavor to disclose other information in a fair, timely
and appropriate manner. When we disclose such information, we basically publish on our website the information we disclose. In addition, we endeavor to utilize thelatest disclosure methods and tools to provide more fair
and widespread disclosure.
(2) Investor Relations Activities
In accordance with our Basic 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 this way, 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 as well
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. Regarding disclosure of information we
consider particularly important, we communicate suchinformation on an ad hoc basis as and when necessary,even if a press release has already been issued, throughsuch 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
to limit carefully our explanations to matters already disclosed and facts commonly known.
(3) Correction of Misconceptions in the Markets
If we identify significant misconceptions regarding
Mizuho Financial Group in the market due to the spreadof rumors or otherwise, we endeavor to investigate theircauses and correct such misconceptions promptly.

205

Privacy Policy Regarding Customer Information

Mizuho Financial Group, Inc. (“MHFG”) hereby establishes
and announces the “Privacy Policy Regarding Customer
Information” applicable to Mizuho Financial Group which iscomposed of MHFG, its consolidated subsidiaries and affiliates (which are accounted for by the equity method) thatare listed in MHFG's Financial Reports.

Policy of Management
Mizuho Financial Group recognizes appropriate protection
and use of personal information to be important social
responsibilities, and makes every effort to appropriately protect and use personal information complying with the
Personal Data Protection Law in Japan, other related regulations and the internal rules of Mizuho Financial Group,
including the “Privacy Policy Regarding Customer
Information” when Mizuho Financial Group conducts business.

Proper Acquisition
Mizuho Financial Group will acquire personal informationthat is necessary to conduct its business by proper and lawful means.

Purpose of Use
Mizuho Financial Group will specify the purpose of use of
personal information and will not use it beyond the specified purpose. Furthermore, Mizuho Financial Group will notuse personal information beyond the purpose limited byrelated regulations.
The purpose of use of personal information is set forththrough the web site or other measures provided by eachcompany of Mizuho Financial Group.

Limitation on Providing Personal Information to a
Third Party
Mizuho Financial Group will not provide personal information to any third party in principle unless the individual concerned has agreed to such use or it is authorized by law.
However, Mizuho Financial Group may provide personal
information to relevant entities without customer consent infollowing cases: Mizuho Financial Group entrusts management of personal information that is necessary to achieve the purpose of use to a third party.
 Mizuho Financial Group is one of the parties in a consolidation transaction.
 Mizuho Financial Group uses personal information
jointly with designated entities that are publicly
informed.

Management of Sensitive Information
Mizuho Financial Group will not acquire, use and provide to
any third party sensitive information (e.g. political affiliation,
religion, participation in labor union, race, ethnic group,
family origin, legal address on family registry and medical
information) unless authorized by law or it is necessary to
conduct business on condition that Mizuho Financial Grouphas customer consent.
Security Measures
Mizuho Financial Group will maintain and manage accurate
and up to date personal information, and prevent leakage
of information with rational security measures. Mizuho
Financial Group will properly supervise employees and parties entrusted with handling personal information.

Continuous Improvement
Mizuho Financial Group will continuously review this policy
according to the development of information technologies
and the changes in social demand, and improve the management of personal information.

Procedures to Request Disclosure
Mizuho Financial Group will endeavor to properly andpromptly cope with following requests from customers:
 notification of the purpose of use
 disclosure of personal data correction, addition and deletion of personal data that
do not reflect the facts
 suspension of use and elimination of personal data suspension of providing personal data to a third party

Customer Request
Mizuho Financial Group will endeavor to cope with customer requests for the management of personal information sincerely and promptly.

 Strengthening Information Security Management Systems
MHFG obtained certifications for the Information Security Management Systems of all divisionsof the company under both the Conformity Assessment Scheme, “ISO/IEC27001: 2005,” theinternational standard, and “JIS Q 27001: 2006,” the domestic standard.
IS97580 / ISO IEC27001

206

Contact Information

Mizuho Financial Group, Inc.
1-5-5, Otemachi,
Chiyoda-ku, Tokyo 100-0004,
Japan
Tel. +81-(0)3-5224-1111
URL: http://www.mizuho-fg.co.jp/english/

Mizuho Corporate Bank, Ltd.

 MHFG's “News Release E-mail Distribution
Service”
MHFG offers an e-mail service for notifying registered users the title and the URL page of thegroup's news releases when releases are placed on
the group's website.
If you wish to register for this service, please
access MHFG's website (http://www.mizuhofg.co.jp/english/), and click “News Release E-mailDistribution Service.”

1-3-3, Marunouchi,
Chiyoda-ku, Tokyo 100-8210,
Japan
Tel. +81-(0)3-3214-1111
URL: http://www.mizuhocbk.co.jp/english/

Mizuho Bank, Ltd.
1-1-5, Uchisaiwaicho,
Chiyoda-ku, Tokyo 100-0011,
Japan
Tel. +81-(0)3-3596-1111
URL: http://www.mizuhobank.co.jp/english/

Mizuho Trust & Banking Co., Ltd.
1-2-1, Yaesu,
Chuo-ku, Tokyo 103-8670,
Japan
Tel. +81-(0)3-3278-8111
URL: http://www.mizuho-tb.co.jp/english/

Mizuho Securities Co., Ltd.
Otemachi First Square,
1-5-1, Otemachi,
Chiyoda-ku, Tokyo 100-0004,
Japan
Tel. +81-(0)3-5208-3210
URL: http://www.mizuho-sc.com/en/

207