THE SHIMIZU BANK,LTD.
Annual Report 2016

ProfileThe Shimizu Bank, Ltd. was established in
1928 with the merger of six banks and has
always been a valuable partner of thelocal community.
The Bank has its headquarters in Shizuoka
City, which has the Shimizu Port, the largest
in the prefecture.
Shimizu Port, located halfway between
Tokyo and Osaka, plays a significant
role in international trade and economic
development.
We will provide customers with a wide
range of financial services, seek further
business expansion as a customer-friendly
bank and contribute to the development of
the local community.

Bank Data

As of March 31, 2016

2-1 Fujimicho, Shimizu-ku, Shizuoka-shi,
Head Office					Shizuoka 424-0941 Japan
Date of Incorporation:
July 1, 1928
Paid-up Capital:			¥8,670,500,000
Number of Branches:			
77
Number of Sub-branches:		
1
Number of Employees:			974
Consolidated Capital Adequancy Ratio(based on domestic standards): 10.75%
Non-Consolidated Capital Adequancy Ratio(based on domestic standards): 10.43%

Consolidated Subsidiaries

As of June 30, 2016

(Millions of Yen)

Ratio of Voting
Right

Ratio of Voting Right
Other Group
Companies

Established

The Shimizu Business Service Co., Ltd.

10100.00%−December 10,1981

Calculating cash

The Shimizugin Career Up Co., Ltd.

30

100.00%−

October 22,1990

Delegation of personnel

The Shimizu General Maintenance Co., Ltd.

30

100.00%−December 24,1991

Management of real estate

The Shimizu Regional Economy Research Center, INC

12100.00%−

October 28,1965

Financial and economic
research services,Training

The Shimizu Lease and Card Co., Ltd.

60

16.01%

45.32%

April 14,1999

Leasing, Credit card

The Shimizu Credit Guarantee Co., Ltd.

50

5.00%

90.00%

November 1,1978

Credit guaranteeing

The Shimizu General Computer Service Co., Ltd.

30

5.00%

50.00%

July 1,1989

Calculation operations

Name of Company

Capital[]Line of Business

THE SHIMIZU BANK,LTD.
1

Message
We want to thank all of our customers for your continued patronage at the Shimizu Bank and our group partners. We have put
together a packet of Disclosure Materials the 2016 fiscal year to share the financial highlights and our efforts of the 2015 fiscal
year. We invite you to read these materials to further your understanding of the Shimizu Bank and our group partners.
Although the Japanese economy has continued its slow recovery this period, the outlook for the latter half of the year is lessclear due to the economic downturn in China and other emerging Asian nations and the worsening economy in resourcerich countries caused by falling oil prices, along with the sharp appreciation of the yen and the drop in stock prices since thebeginning of the year. As exports and production weaken, there is growing concern that previously robust capital investment will
be pushed back. Meanwhile, although employment remains high, wage rises in major corporations are lower than a year ago,
which is slowing down previously healthy consumer spending.
The economy of Shizuoka Prefecture, on which our bank is mainly founded, has shown gradual improvement, including
increased capital investment in both manufacturing and non-manufacturing industries centered on large and medium-sizedcorporations. On the other hand, auto-related exports in particular are weakening and production is down as a result of thefurther economic slowdown of emerging nations and the shift of production overseas. Consumer spending has been picking up
slowly amid improving employment and income conditions, but seems to be slowing down somewhat in the second half of theyear.
The climate surrounding our bank is expected to become increasingly harsh due to changes in social structure and financial
environment, such as the progressively declining and aging population, the hollowing out of industry following corporate
overseas expansion, and the introduction of a negative-interest policy.
This is the context in which we launched our 26th medium-term business plan “Advance As One – Toward the realization ofsustainable growth together with our community and customers,” which will run for four years from April 2016. Following on fromour 24th and 25th medium-term business plans, our vision is to demonstrate the significance of our existence by setting out thefour basic policies of “improving financial intermediary functionality,” “increasing productivity,” “securing our business base,”and “creating more dynamic human resources,” based on which we will engage in priority measures.
We have previously made efforts to train personnel as a key management resource, but have now reached a stage when
we give individuals greater opportunity to develop their maximum potential. Specifically, we will deepen our involvement in
the corporate field, which has been our focus to date, and expand the fields in which we can show our strength through a“customer-oriented strategy” that offers ideal solutions
for individual companies, based on our interest andunderstanding of our customers’ business. In individual
fields, we will expand our bank’s business areas througha market-oriented strategy of introducing products andservices to the market that individual customers want, rather
than simply releasing products. Through these customeroriented and market-oriented policies, we will return to our
origins as a regional bank and, by getting more closely
involved in regional industry and life, contribute to regional
revitalization.
At the same time, we will enhance our bank’scompetitiveness through increased productivity, by realizing
operational reforms in pursuit of efficiency and raisingawareness of time cost among all members of staff.
We also fully recognize our social responsibility as a bank,and will develop a solid attitude of compliance as well
as strengthen our stance on governance with the aim ofincreasing our corporate value.
Going forward, our employees will unite to deliver attractive
products and services that meet customer needs anddemonstrate the importance of our presence as a bankneeded by our region. To this end, I ask all of you for yourcontinued valuable support and patronage.
July 2016

Katsuichiro Toyoshima
President

THE SHIMIZU BANK,LTD.
2

The 26th Medium-term Management Plan

From April 1,2016
to March 31,2020 (Four years)

Toward the realization of sustainable growth together
with our community and customers■ Amid the many changes taking place around us, we will achieve our vision of demonstrate thesignificance of our existence and remain a bank that is needed by the community, by honing ourclose relationships with the community and our customers and bringing all members of the Shimizu
Bank Group together to Advance As One.
■ This 26th medium-term business plan covers an important four-year period ahead of the 90th and100th anniversaries of our foundation, during which time we will implement priority measures based on
our basic policies of “improving financial intermediary functionality,” “increasing productivity,”“securing our business base,” and “creating more dynamic human resources” in order to realize abenevolent cycle toward a future that gives each and every employee a sense of satisfaction.

VisionDemonstrate the significance of our existence

Period of plan

April 1, 2016 to March 31, 2020 (4 years)

Basic policies

Improving ﬁnancial
intermediaryfunctionality

Target ﬁgures① Core operational net proﬁt¥ 4 billion or more
② Core OHR
70% level

Increasing
productivity

Securing ourbusiness baseCreating more
dynamic humanresources③ Total loans to small to medium-sized companies¥ 880 billion or more
④ Total personal deposits¥1 trillion or more

Cost as a proportion of core operational gross proﬁt

Improvingﬁnancial
intermediaryfunctionality

Enhancement of personal sales
by market-oriented strategy

Realization of operational reformin pursuit of efficiency

Sophistication of investment
in financial market

Raising awareness of time cost

Proactive participationin community formation

Community
Customers

Strengthening of cooperation andearning power of group companies
Optimum store location and reformof head office structure

Thorough implementation of
low cost management
Career paths to bring out
maximum ability

Work-life balance reform

Increased corporate value
through branding

Promotion of diversity

Strengthening of governanceand risk management system

Securing ourbusiness base

Increasing
productivity

Enhancement of corporate sales bycustomer-oriented strategy

Thorough implementationof compliance

Enhancement of practical training

Creating more
dynamic humanresources

CSR activities that respect links
with community

THE SHIMIZU BANK,LTD.
3

Support for Overseas Business Development
We made our efforts to continue to meet the customer needs of overseas businessdevelopment through expansion of external network.

Network of support for overseas business

The Shimizu Bank Ltd.

Vietcom Bank
(Vietnam)Bank of Communication(China)State Bank of India(India)Kasicorn Bank
(Thailand)
Bank Negara Indonesia(Indonesia)

Metropolitan Bank
(Philippines)

Estadode Aguascalientes(Mexico)Estado de Jalisco(Mexico)Domestic external network
The Japan Bank for International Cooperation (JBIC)
Daiwa Securities Co.,Ltd
Shizuoka International Business Association(SIBA)MIRAI Consulting
Meinan Group
Orix Corporation
Japan Halal Business Association

THE SHIMIZU BANK,LTD.
4

Mt. Fuji – our symbol –Mt. Fuji and The Shimizu Bank
Mt. Fuji is the highest mountain in Japan, located on the border of Shizuoka
prefecture, and is widely known as a symbol of Japan, at home and abroad, for its
elegant appearance.
We have published a calendar about Mt. Fuji every year since 1969 and have beenusing a corporate logo since 1974 whose design includes images of Mt. Fuji and Gulf
of Suruga.
In June of 2013, Mt. Fuji was registered as a World Heritage Site.
In line with the growing recognition of Mt. Fuji across the world, we intend to further
strengthen "demonstrate the significance of our existence" for individual customers.

All Photos by Akira Tsutsui
THE SHIMIZU BANK,LTD.
5

Summary of Business
Consolidated Results
Ordinary revenue increased year-on-year by JPY469millon to JPY29.539billion due to factors such as increased securities
related income, while ordinary expenses increased over the same period by JPY95million to JPY24.55billion due to increased
service transaction fees and so on. The result of this was a JPY374million year-on-year rise in ordinary profit to JPY4.989billion.
Deposits decreased by JPY50.3billion year-on-year to JPY1,349.3billion as a result of trying to improve our community-linked
business base and conducting profit-focused procurement, while personal deposit assets rose JPY5.4billion over the same
period to JPY1,077.3billion resulting from an increase in personal pension insurance, part of meeting diverse customer needs.
Loans increased JPY19.5billion over the previous year to JPY1,065.1billion as a result of our aggressively responding tocustomers’ funding needs as a regional bank.
Securities fell JPY64.1billion year-on-year to JPY253.9billion due to our agile management and focus on market trends.
(Millions of Yen)

Consolidated Five-years Summary

2012

2013

2014

2015

2016

Ordinary Income
Ordinary Profit¥29,304
4,453¥29,6363,518¥30,265
3,660¥29,070
4,615¥29,539
4,989
3,299

Profit Attributable to Owners of Parent

1,636

2,430

2,077

3,400

Comprehensive Income

3,755

5,868

668

7,463

372

Total Net Assets
Total Assets

69,8791,408,745

74,432
1,488,023

74,2501,494830

80,717
1,591,910

80,5281,483,918

Net Assets per Share in Yen
Net Income per Share in Yen

7,026.55
171.537,571.05
254.727,552.19
217.788,329.77
356.458,302.98
345.92

Non-Consolidated Results
Ordinary revenue rose JPY190million from the same period a year before to JPY24.65billion due to an increase in securities
related revenue and other factors. Ordinary expenses fell over the same period by JPY7million to JPY19.987billion due todecreasing operating costs and so on.
The result of this was a JPY198million year-on-year increase in ordinary profit to JPY4.662billion, and a JPY683million increasein net profit over the same period to JPY3.21billion.

(Millions of Yen)

Non-Consolidated Five-years Summary

2012

2013

2014

2015

2016

Ordinary Income
Ordinary Profit¥24,506
4,191¥24,905
3,238¥25,520
3,505¥24,459
4,464¥24,650
4,662
3,210

Profit Attributable to Owners of Parent

1,644

1,824

1,999

2,527

Capital Stock

8,670

8,670

8,670

8,670

8,670

Total Net Assets

66,47871,06070,974

77,161

77,857

Total Assets

1,402,363

1,482,692

1,487,974

1,584,920

1,477,336

Deposits

1,309,404

1,350,435

1,382,325

1,404,405

1,353,887

Loans and Bills Discounted
Securities

979,731
338,770

1,017,400
285,174

1,036,413
301,501

1,050,470
318,4421,070,463
254,296

Net Assets Per Share in Yen
Cash Dividends per Share in Yen
Net Income per Share in Yen

6,967.52
60
172.37

7,448.37
60
191.247,440.33
60
209.558,089.85
60
264.998,161.97
60
336.65

Deposits(Millions of Yen)

(Millions of Yen)

1,450,000(Millions of Yen)
3,500

1,050,000

1,036,413
1,017,400

1,000,000

1,309,404
1,300,000

2013

2014

2015

2016

900,000

Credit Rating
Credit rating is assigned to debts as follows:
Concerning the relevant debt, a credit rating
agecy, which is a fair and disinterested third
party, rates the certainty of payment of its
principals and interest on a contractual basis,and such rating is represented using a simple
code.

2,527

2,500

979,731

2,000

1,824

1,999

2013

2014

1,644

950,000

1,250,000

2012

3,210
3,000

1,050,470

1,353,887

1,350,435

1,350,000

Profit Attributable to
Owners of Parent

1,070,463

1,382,325 1,404,405

1,400,000

1,200,000

Loans and Bills Discounted

1,100,000

1,500

2012

2013

2014

2015

1,000

2016

AAA

Our Bank

AA

A

A
BBB

2012

2015

2016

BB
B
CCC
CC
C
D

Credit Rating : A
Relevant Debt : long-term Preferred Debt
Credit Rating Agency :Japan Credit Rating Agency,Ltd.
(As of March, 2016)

THE SHIMIZU BANK,LTD.
6

Compliance System
At the Shimizu Bank group, our awareness of our social responsibility and public duties has led us to make compliance a
top priority, building an effective compliance system that will help us earn the trust of our customers and the local
communities we share.
Our management in particular is actively engaged in compliance issues and is working with executives and employees ofall of the companies in our group to foster awareness on these issue and create a corporate culture in which"compliance is the foundation for everything."

Establishing a framework for compliance
For through compliance, the Shimizu Bank has created a ”Legal and Regulatory Compliance Policy” as our basic policy
for compliance in keeping with our management policy. This Compliance Policy is widely disseminated across the
Shimizu Bank group.
At monthly expanded management meetings, members of bank management including the president meet withoutside corporate lawyers to discuss matters concerning compliance.
In addition, we have established the Legal Office within the Corporate Administration Division to supervise complianceand entrusted that office with centralized control of information pertaining to compliance issues and providing
guidance on the laws and regulations officers and employees must observe.
Furthermore, we have assigned individuals to be in charge of compliance at each division and branch to facilitate
coordination with the office that overseas compliance (the Legal Office) and exhaustively enforce observance of laws
and regulations. The Shimizu Bank also assigns regional compliance supervisor and the like in order to properly addresscompliance issues in relevant divisions.

■Compliance System

Board of Directors
ReportAudit & Supervisory Board
Instruction

Management Committee
Instruction

ReportConsult

Corporate Lawyers

Corporate Administration Division Legal OfficeInspection

Internal Audit Division( Compliance Supervisory Department )( Compliance Report System )Centralized Control of Compliance( Anti-social Forces Treatment Department )Anti Money Laundaring'Wire-the-money scam'Legislative Remedy

Inspection

Issues Related to Each Works

Report, Contact, Consult

Divisions in Head Office

Operations Division
Report,Contact,
Consult

Inspection Result
ReportDiscuss

Consult and Compliants treatment
Financial ADR Treatment
Disclose personal Information

Branch Advisory Division

Discuss

Foreign Exchange Trading
Relationship of the taliban and others
Investment Trust Sales, etc

Discuss

Inspection

Markets andInternational Division
Report, Contact, Consult

Block Compliance Supervisor
Block Compliance Officer
Compliance Officer, Manager
All Employees (Bank Clerk, Staff, etc)

● Legal and Regulatory Compliance Policy
Bolster Readiness for Legal and Regulatory
Compliance
Regarding the observance of laws and regulations,which the Shimizu Bank and its group companies
have already recognized as a top priority, we willcontinue to foster awareness of compliance and instill
it in all executives and employees at all of our groupcompanies to make sure that they all understand it
and get into the habit of applying it.
Preventing Legal and Regulatory Violations
We have taken action to prevent legal and regulatory
violations by forming a corporate culture which allows
us to detect weaknesses and problem areas in ourefforts toward legal and regulatory compliance,
reflect on past conduct, and make improvements in
those areas promptly.

Branches, Divisions, andGroup Companies, etc

Systems Targeting Anti-social Forces
Due to their public nature and critical economic function, banks are
required to exclude anti-social forces from financial transactions. For thisreason, the Shimizu Bank has created a basic policy that we will standfirmly against anti-social forces which pose a threat to the order andsafety of civic life, and will not provide any favors to such forces.
In addition, at the Shimizu Bank we have given the Corporate
Administration Division the task of collecting, analyzing, and centrally
managing information pertaining to anti-social forces, and haveestablished a system whereby the bank systematically addresses such
issues and excludes anti-social forces from business transactions incooperation with external special agencies including law enforcement
and the national and prefectural centers for the elimination of
boryokudan (violent crime syndicates).
Furthermore, in order to make it clear that we exclude anti-social forcesfrom our business, we have also introduced clauses regarding theexclusion of “boryokudan” crime syndicates in basic loan agreements
and in our rules concerning deposits and other services. We require all
customers to comply with an agreement by which they express and affirm
that they are not associated with any anti-social forces.

THE SHIMIZU BANK,LTD.
7

Risk Management System
Because of changes in the surrounding environment of the financial institutions, the risks banks face are increasingly
diverse and have become complex. As financial institutions have the responsibility to safely and effectively manage
the deposits they receive from customers, it is increasingly important to upgrade the risk control system, which is used toproperly control various risks according to their characteristics.
Shimizu Bank is fully aware of the significance of risk management and endeavors to strengthen our risk management
system.

Risk Management System
Shimizu Bank stipulated the “Integrated risk management provisions” as basic provisions on risk management, andestablished a risk management system, in which the Board of Directors plays the central role. Based on theprovisions, the Bank draws up “Risk Management Regulations” and “Risk Management Procedures” according tovarious risk categories which prescribe the specific management methods, etc., as well as reporting to the Board of
Directors and the Management Committee. The Bank formulates its risk management plan every fiscal year tocontrol risks effectively, and identifies, analyzes and assesses risks based on these plans.

■ A Chart of the integrated

risk management system

Auditors/
Board of Auditors

Board of Directors
Management
Committee[Integrated risk management section]
Risk Management Office,Corporate Administration Division

Operational risk
Credit risk

Market risk

Liquidity risk
Adnimistrative
risk

System risk

Legal risk

Reputationalrisk

Other risk

Divisions concerned in risks

Audit
Division
Risk Management Office, Corporate Administration Division

CreditDivision

Risk
Risk
Management Management
Office,Office,Corporate
Corporate
Admnistration Admnistration
Division
Division

Operations
Division

Operations
Division

Risk
Legal Office, Management
Each Division
Office,Corporate
at
Corporate
Administration
Administration Headquarters
Division
Division

Branches, Headquarters, Consolidated Subsidiaries, etc.
Integrated Risk Management
From the perspective of enhancing soundness in management, Shimizu Bank comprehensively identifies major risks thatthe bank faces, compares them with our corporate strength (equity capital), then establishes a self-controlling type risk
management environment, as well as addressing the tasks of enhancing risk management so as to maintain a properrisk management environment.

THE SHIMIZU BANK,LTD.
8

Risk Management System
Credit risk management
Shimizu Bank collectively administers loans and bills discounted, assets with a credit risk, and off-balance sheet assets,managing credit risk of the Bank itself and its consolidated subsidiaries.
Our screening system is composed of two sections, Sales Promotion and Screening, in order to maintain and improve
the soundness of loan assets. In addition, the Bank strictly manages credits above a certain level by screening andpassing a resolution for financing policy at the Management Meeting, which consists of the Executives.
Moreover, the Bank defined its credit policy (the basic code of conduct for financing) to clarify the bank’s basic action
guidance in the loan business, and thoroughly enforces it among our bank clerks, so as to maintain and improve thelevel of our bank clerks’ observation of the financing rules.
A credit rating system was introduced to measure the credit risk of borrowers with a unified standard, and it is utilized to
set lending rate guidelines according to creditworthiness. Furthermore, in terms of credit management, the Bank
endeavors to manage appropriate portfolios, to disperse risks, and to ensure stable profits by measuring risk quantities
with the credit rating system, etc. and acknowledging the status of loan concentration in specific business types, etc.

Market risk management
The Shimizu Bank manages market risk to securely earn stable profits through market transactions. The Bank has
installed both a front office and back office in the Markets and International Division, as well as a middle office in the
Risk Management Office of the Corporate Administration Division, which is the Department concerned with risk, thus
establishing a system of mutual checks and balances.
The status of measured risks is reported at the Board of Directors and Management Meeting so that the Executives canaccurately acknowledge and appropriately make decisions on the market risks.

Liquidity risk management
The Bank manages funds daily, weekly, and monthly at the Markets and International Division, which is a fund raising
management section, while the Risk Management Office of the Corporate Administration Division, which is thedepartment concerned with risk, manages the risks.
In addition, as a preparation for contingencies, the Bank set two phases of emergencies and prepares to secure
financing methods according to respective situations.

Operational risk management
The Bank recognizes administrative risk, system risk, legal risk, reputational risk, and other risks as operational risk;
endeavors to prevent such risks from becoming tangible; and minimizes the impacts caused by such risks when they
become apparent.
Regarding administrative risk, for the purpose of establishing a routine of impartial and swift office work, the Bank has
been improving the quality of office work through the creation of various rules on office work, implementation oftraining programs, and centralization at the headquarters of the branch office work.
In relation to system risk management, the Bank uses as its core banking system “PROBANK-R2” created by Fujitsu Ltd.
We established a backup center for “PROBANK-R2”, reinforcing security against disasters (like the Tokai earthquake),
whose occurrence is a concern. Moreover, the Internal Audit Division audits the computing systems and programs
regularly, auditing system development and the administrative status of system operations, and verifying theeffectiveness of risk management.
The legal risk is the risk in which the Bank suffers losses by violating laws and regulations, etc. The Shimizu Bank places theobservance of laws and regulations, etc. as its priority issue in management to avoid the occurrence of the legal risk,
and vigorously addresses actions to strengthen our preparedness to further observe laws and regulations.
Reputational risk is the risk suffered from unexpected damages by media coverage, etc. about the entire financial
industry and our bank. The Bank takes measures, such as establishing rules and manuals which prescribe our actions, toprevent circulation of unfounded rumors and to respond to them.
The Bank has also established internal control systems to appropriately manage other operational risk, respectively.
In order to be ready for emergency events such as natural disasters, and to continue or swiftly restore our essential
business in order to provide stable financial function to our customers, Shimizu Bank established an action plan thatassumes the outbreak of a state of emergency, and has built a business continuity management based on this plan.

ALM System
The Bank regularly holds Management Meetings, which mainly consist of Executives, and the ALM Earnings
Management Committee which in turn consists of General Managers, to examine proper assets and liability structures,etc. based on the financial and economic environment and forecasts of future interest rates, etc., so that the bankcan fully exert the functions of ALM, with the goal to maximize profits while managing assets and liabilities in an integral
manner balanced with adequate risks.

THE SHIMIZU BANK,LTD.
9

Corporate Data
Consolidated Balance Sheets
AssetsCash and Due from Banks
Trading Account Securities
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchanges
Lease Receivables and Investment Assets
Other Assets
Tangible Fixed Assets
Buildings, Net
Land
Leased Assets, Net
Construction in Progress
Other Tangible Fixed Assets
Intangible Fixed Assets
SoftwareLease Assets
Other Intangible Fixed Assets
Net Defined Benefit AssetDeferred Tax Assets
Customers' Liabilities for Acceptances and Guarantees
Allowance for Loan Losses
Total Assets

Liabilities
Deposits
Negotiable Certificates of Deposit
Borrowed Money
Foreign Exchanges
Bonds Payable
Other Liabilities
Provision for Bonuses
Net Defined Benefit Liability
Provision for Directors' Retirement Benefits
Provision for Reimbursement of Deposits
Deferred Tax Liabilities
Acceptances and Guarantees
Total Liabilities
Net Assets
Capital Stock
Capital Surplus
Retained Earnings
Treasury Shares
Total Shareholders' Equity
Valuation Difference on Available-for-Sale Securities
Deferred Gains or Losses on Hedges
Remeasurements of Defined Benefit Plans
Total Accumulated Other Comprehensive Income
Subscription Rights to Shares
Non-Controlling Interests
Total Net Assets
Total Liabilities and Net Assets(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

March 31,2015

March 31,2016

March 31,2016¥194,095
221
1,201
318,174
1,045,630
522
9,691
8,285
19,524
8,971
9,288
78
0
1,185
873
703
8
161
477
330
2,773
(9,891)
1,591,910¥131,417
388
1,200
253,983
1,065,150
609
9,787
5,316
19,729
8,871
9,320
17
0
1,519
1,256
1,013
5
237
1,258
2,769
(8,951)
1,483,918$1,166,285
3,449
10,6582,254,026
9,452,881
5,411
86,86547,183
175,094
78,73082,713159
2
13,488
11,146
8,993
46
2,107
11,171
24,580(79,442)
13,169,311(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

March 31,2015

March 31,2016

March 31,2016¥1,399,738
68,215
19,78826
10,000
7,257
522
2,361
106
45
357
2,773
1,511,193¥1,349,389
5,000
25,9995
10,000
6,439
506
3,142
93
43
2,769
1,403,389$11,975,414
44,373
230,740
49
88,74657,146
4,492
27,888825
382
24,58012,454,642

8,670
5,272
58,475(294)
72,125
7,177
0
147
7,325
1,266
80,717
1,591,910

8,670
5,272
61,202(298)
74,847
5,218
0
(882)
4,335
18
1,327
80,5281,483,918

76,947
46,793543,155(2,647)664,249
46,3090(7,831)
38,478164
11,777
714,669
13,169,311

Notes
1. The Japanese yen figures are rounded down to the nearest one million yen in this financial report.
2. Figures stated in U.S.dollars are translated solely for convenience at the rate of ¥112.68 per U.S.$1, the approximate rate of exchange prevailing on March 31,2016.

THE SHIMIZU BANK,LTD.
10

Consolidated Statement of Income
Ordinary Income
Interest Income
Interest on Loans and Discounts
Interest and Dividends on Securities
Interest on Call Loans
Interest on Deposits with Banks
Other Interest Income
Fees and Commissions
Other Ordinary Income
Other Income
Recoveries of Written off Claims
OthersOrdinary Expenses
Interest Expenses
Interest on Deposits
Interest on Negotiable Certificates of Deposit
Interest on Call Money
Interest on Borrowings and Rediscounts
Interest on Bonds
Other Interest Expenses
Fees and Commissions Payments
Other Ordinary Expenses
General and Administrative Expenses
Other Expenses
Provision of Alliwance for Loan Losses
OthersOrdinary Income
Extraordinary Income
Gain on Bargain Purchase
Extraordinary Losses
Loss on Disposal of non-Current Assets
Impairment Loss
Income Before Income Taxes and Non-Controlling Interests
Income Taxes - Current
Income Taxes - Deferred
Total Income Taxes
ProfitProfit Attributable to Non-Controlling Interests
Profit Attributable to Owners of Parent(Millions of Yen)

(Millions of Yen)

Years ended
March 31,2015¥29,070
18,32014,028
4,213
1
76
0
8,162
1,056
1,530
2
1,528
24,454
1,254
862
82
11
64
229
4
4,475
314
17,180
1,229
985
243
4,615
938
938
84
4
79
5,469
1,488
567
2,055
3,413
13
3,400

(Thousands of U.S.Dollars)

Years ended
March 31,2016¥29,539
17,34813,426
3,842
1
77
0
8,430
2,459
1,301
1,301
24,550
1,062
846
43
10
68
88
5
4,751
894
16,457
1,384
943
440
4,989
50
2
47
4,939
1,465
111
1,577
3,362
63
3,299

Years ended
March 31,2016$262,157
153,963
119,159
34,09911685
774,816
21,825
11,552
11,552
217,875
9,430
7,512
385
96
603
780
51
42,167
7,935
146,050
12,2908,377
3,913
44,282446
21
425
43,83513,007989
13,997
29,838559
29,278

Consolidated Statement of Comprehensive Income(Millions of Yen)

ProfitOther Comprehensive Income
Valuation Difference on Available-for-Sale Securities
Deferred Gains or Losses on Hedges
Remeasurements of Defined Benefit Plans
Comprehensive Income
Comprehensive Income Attributable to Owners of the
ParentComprehensive Income Attributable to Non-Controlling
Interests(Millions of Yen)

(Thousands of U.S.Dollars)

Years ended
March 31,2015¥3,413
4,050
3,710
0
339
7,463

Years ended
March 31,2016¥3,362(2,990)(1,959)(0)(1,030)372

Years ended
March 31,2016$29,838(26,536)(17,392)(2)(9,141)
3,301

7,464

309

2,748

(0)

62

553

Notes
1. The Japanese yen figures are rounded down to the nearest one million yen in this financial report.
2. Figures stated in U.S.dollars are translated solely for convenience at the rate of ¥112.68 per U.S.$1, the approximate rate of exchange prevailing on March 31,2016.

THE SHIMIZU BANK,LTD.
11

Consolidated Statements of Changes in Equity
Years ended

March 31,2015(Millions of Yen)

Shareholders' Equity

Balance at Aprill 1, 2014

Capital Stock

Capital Surplus

Retained Earnings

Treasury Shares

Total Shareholders'Equity¥8,670¥5,272(¥290)

8,670

5,272

¥55,129518
55,648(290)¥68,781518
69,300

(3)
0

(572)
3,400
(3)
0

(3)
(294)

2,824
72,125

Subscription
Righits toShares

NonControlling
Interests

Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2014
Changes of Items During Period

(572)
3,400

Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares(0)

Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2015

8,670

(0)
5,272

2,827
58,475

Accumulated Other Comprehensive Income
Total
Valuation
Deferred Gains Remeasurements Accumulated
Difference on
Or Losses on of Defined Benefit
Other
Available-forComprehensive
Hedges
Plans
Sale Securities
IncomeBalance at Aprill 1, 2014

¥3,452¥0(¥191)¥3,260-¥2,208

3,452

0

(191)

3,260

-

2,208

¥74,250518
74,768

(941)
(941)
1,266

(572)
3,400
(3)
0
3,123
5,948
80,717

Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2014

Total Net
EquityChanges of Items During Period
Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares
Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2015

Years ended

3,724
3,724
7,177

0
0
0

339
339
147

4,064
4,064
7,325

-

March 31,2016(Millions of Yen)

Shareholders' Equity

Balance at Aprill 1, 2015

Capital Stock

Capital Surplus

Retained Earnings

Treasury Shares¥8,670¥5,272(¥294)

8,670

5,272

¥58,475
58,475

Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2015

Total Shareholders'Equity(294)¥72,125
72,125

(4)
-

(572)
3,299
(4)
-

(4)
(298)

2,722
74,847

Subscription
Righits toShares

NonControlling
Interests

Changes of Items During Period

(572)
3,299

Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares-

Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2016

8,670

5,272

2,726
61,202

Accumulated Other Comprehensive Income
Total
Valuation
Deferred Gains Remeasurements Accumulated
Difference on
Or Losses on of Defined Benefit
Other
Available-forComprehensive
Hedges
Plans
Sale Securities
IncomeBalance at Aprill 1, 2015

¥7,177¥0¥147¥7,325-¥1,266

7,177

0

147

7,325

-

1,266

¥80,71780,717

60
60
1,327

(572)
3,299
(4)
(2,910)(188)
80,528Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2015

Total Net
EquityChanges of Items During Period
Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares
Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2016

(1,959)(1,959)
5,218

(0)
(0)
0

(1,030)(1,030)(882)(2,989)(2,989)
4,335

18
18
18

Notes
1. The Japanese yen figures are rounded down to the nearest one million yen in this financial report.
2. Figures stated in U.S.dollars are translated solely for convenience at the rate of ¥112.68 per U.S.$1, the approximate rate of exchange prevailing on March 31,2016.

THE SHIMIZU BANK,LTD.
12

Consolidated Statements of Changes in Equity
Years ended

March 31,2016(Thousands of U.S.Dollars)

Shareholders' Equity

Balance at Aprill 1, 2015

Capital Stock

Capital Surplus

Retained Earnings

Treasury Shares$76,947$46,793($2,609)76,947

46,793$518,955
518,955

Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2015

Total Shareholders'Equity(2,609)$640,087
640,087(38)-(5,078)29,278(38)-(38)(2,647)

24,161
664,249

Changes of Items During Period(5,078)29,278Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares-

Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2016

76,947

46,79324,200543,155

Accumulated Other Comprehensive Income
Total
Valuation
Deferred Gains Remeasurements Accumulated
Difference on
Or Losses on of Defined Benefit
Other
Available-forComprehensive
Hedges
Plans
Sale Securities
IncomeBalance at Aprill 1, 2015

Subscription
Righits toShares

NonControlling
Interests$63,695$2$1,310$65,008-$11,242

63,6952

1,310

65,008-

11,242$716,338
716,338534
534
11,777(5,078)29,278(38)(25,831)(1,669)714,669

Cumulative Effects of Changes in Accounting Policies
Adjusted Balance at Aprill 1, 2015

Total Net
EquityChanges of Items During Period
Dividends of Surplus
Profit Attributable to Owners of Parent
Purchase of Treasury Shares
Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at March 31, 2016

(17,386)(17,386)
46,309(2)(2)
0(9,141)(9,141)(7,831)(26,530)(26,530)
38,478

164
164
164

Notes
1. The Japanese yen figures are rounded down to the nearest one million yen in this financial report.
2. Figures stated in U.S.dollars are translated solely for convenience at the rate of ¥112.68 per U.S.$1, the approximate rate of exchange prevailing on March 31,2016.

THE SHIMIZU BANK,LTD.
13

Consolidated Statement of Cash Flows(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

Years ended
March 31,2015

Years ended
March 31,2016

Years ended
March 31,2016

Cash Flows from Operating Activities
Income Before Income Taxes and Non-Controlling Interests¥5,469¥4,939$43,835

Depreciation

1,302

1,256

11,146

79

47

425

Gain on Bargain Purchase

(938)

-

-

Increase (Decrease) in Allowance for Loan Losses

354

(939)

(8,337)

Impairment Loss

(7)

(15)

(140)

Decrease (Increase) in Net Defined Benefit Assets

(183)

477

4,241

Increase (Decrease) in Net Defined Benefit Liability

Increase (Decrease) in Reserve for Employees' Bonuses

(802)

780

6,927

Increase (Decrease) in Reserve for Directors' Retirement Benefits

(9)

(13)

(117)

Increase(Decrease) in Provision for Reimbursement of Deposits

(12)

(1)

(17)

(18,320)(17,348)(153,963)

Gain on Fund Management
Financing Expenses

1,254

1,062

9,430

Loss(Gain) Related to Securities(2,013)(2,730)(24,235)

Loss (Gain) on Money Held in Trust

(111)

(11)

(12)

Loss(Gain) on Disposal of Non-Current Assets

4

2

21

Net Decrease (Increase) in Trading Account Securities

31

(167)

(1,483)

Net Decrease (Increase) in Loans and Bills Discounted(14,204)(19,519)(173,233)

Net Increase (Decrease) in Deposit

22,282(50,349)(446,833)

Net Increase (Decrease) in Negotiable Certificates of Deposit

68,215(63,215)(561,018)

Net Increase (Decrease) in Borrowed Money (Excluding Subordinated Borrowings)

9,333

6,211

55,124

Net Decrease (Increase) in Deposit (Excluding Deposit Paid to Bank of Japan)

(151)

(25)

(221)

Net Decrease (Increase) in Call Loans

5,000

-

-

68

(87)

(776)

Net Decrease (Increase) in Foreign Exchanges Assets
Net Increase (Decrease) in Foreign Exchanges Liabilities
Net Decrease (Increase) in Lease Receivables and Investment Assets

10

(21)

(189)

(629)

(543)

(4,824)

Proceeds from Fund Management

18,55017,699157,074

Payments for Finance(1,340)(1,086)(9,640)

Other, net(7,682)

758

6,733

Subtotal

85,652(122,841)(1,090,184)

Income Taxes Paid

(1,692)(1,553)(13,789)

Net Cash Provided by (Used in) Operating Activities

83,960(124,395)(1,103,974)

Purchase of Securities(426,436)(320,066)(2,840,494)

Proceeds from Sales of Securities

416,469

332,100

2,947,286

5,849

51,976461,279

Decrease in Money Held in Trust

611

12

115

Purchase of Tangible Fixed Assets(813)(1,099)(9,758)Purchase of Intangible Fixed Assets

(338)

(693)

(6,152)

Proceeds from Sales of Tangible Fixed Assets

168

109

975

(4,490)62,340553,249(628)

Cash Flows from Investing Activities

Proceeds from Redemption of Securities

Net Cash Provided by (Used in) Investing Activities

Cash Flows from Financing Activities
Repayments of Lease Liabilities
Redemption of Subordinated Bonds
Purchase of Treasury Shares
Proceeds from Sales of Tresury Shares
Cash Dividends Paid
Dividends Paid to Non-Controlling Interests
Net Cash Provided by (Used in) Financing Activities

Effect of Exchange Rate Changes on Cash and Cash Equivalents
Net Increase (Decrease) in Cash and Cash Equivalents
Cash and Cash Equivalents at Beginning of Period
Cash and Cash Equivalents at End of Period

(147)

(70)

(8,000)

-

-

(3)

(4)

(38)

0

-

-

(571)

(570)

(5,060)

(2)

(2)

(18)

(8,724)(647)(5,746)

(9)

(0)

(1)

70,735(62,703)(556,472)

121,765

192,500

1,708,383

192,500

129,797

1,151,911

Notes
1. The Japanese yen figures are rounded down to the nearest one million yen in this financial report.
2. Figures stated in U.S.dollars are translated solely for convenience at the rate of ¥112.68 per U.S.$1, the approximate rate of exchange prevailing on March 31,2016.

THE SHIMIZU BANK,LTD.
14

Board of Directors and Corporate Auditors●Managing Directors
Shigeru Nonoyama●Chairman
Noriji Yamada

Ayato Mochizuki●President(Representative Director)
Katsuichiro Toyoshima●Directors
Sumiko Suzuki●Senior Managing Director(Representative Director)
Akihiro Mochizuki●Corporate Auditors
Kazuhito Kobayashi

As of June 30,2016●Managing Executive Officers
Syuji Sano

Akihiro Sei

Masashi Harada

Youichiro Ito

Fumitoshi Yabuzaki

Kazuaki Isobe

Yoshiaki Harada

Fujio Kaneda
Keiko Higashi
Naoyuki Shirakawa
Syunji Usami
Yasuhiro Iwayama

Organization Chart

As of March 31,2016

General Meeting of Shareholders

Board of Directors

Chairman

Directors

Management Planning
Division

President

Senior Managing Director

Secretariat OfficeBusiness Information Office TokyoManagement Committee
Deputy President

Board of Auditors

Auditors

Business Information Office Nagoya
Corporate Administration
Division

Finance Office
Legal Office

Managing Director

Risk Management OfficeCounselor
Directors in Charge

General Affairs and Human
Resources Division

Executive Officers

Career Development Division

Personnel Rating Office

Head OfficeBusiness Planning Division

Branch Advisory Division

Customer Services Office

Customer

Branches

Loan Center
Markets and International
Division

Securities Office

Credit DivisionCorporate Support Division
Operations Division

Operations Center Office
Loan Administration OfficeInternal Audit Division

Mt. Fuji
FUJI

MARKETS AND INTERNATIONAL DIVISIONTEL 81-54-353-5164 SWIFT : SMZGJPJT
http://www.shimizubank.co.jp/

HEAD OFFICENUMAZUSHIZUOKAYAIZU
HAMAMATSUTOKYO
NAGOYATHE SHIMIZU BANK,LTD.
15