THE SHIMIZU BANK,LTD.

Annual Report 2015

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 ininternational 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

Head Office

As of March 31, 2015
2-1 Fujimicho, Shimizu-ku, Shizuoka-shi,
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:
999
Consolidated Capital Adequancy Ratio(based on domestic standards): 10.82%
Non-Consolidated Capital Adequancy Ratio(based on domestic standards): 10.49%

Consolidated Subsidiaries

As of June 30, 2015
CapitalName of Company(Millions of Yen)

Ratio of Voting
Right

Ratio of Voting Right

EstablishedLine of Business

Other Group
Companies

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

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 2015 fiscal year to share the financial highlights and our efforts of the 2014 fiscal
year. We invite you to read these materials to further your understanding of the Shimizu Bank and our group partners.
Japan's economy in the current period has had a gradual improvement on the back of a rise in domestic demand due topublic works projects and a recovery in overseas demand mainly in developed countries, while accepting the repercussions oflast-minute demand because of the increase in the consumption tax. Government subsidies and financial easing by the Bankof Japan among other catalysts has helped bolster capital investment. Investments were made in the upgrading ofdeteriorating equipment and efficiency and energy-saving equipment that had been postponed, in addition to investments
made in expectation of increased demand. There was strong increases in consumer spending thanks to improved employment
and income.
In terms of the economy in Shizuoka Prefecture, the primary service area for the Shimizu Bank, there has been increased
amount of capital investment in the manufacturing sector for the purposes of research and development and improved
productivity, while there was also an increased amount of capital investment linked to the opening of retail outlets anddistribution locations in non-manufacturing sectors. Industries such as motorcycle, electric machine and general machine
manufacturers also regained ground with their exports. On the other hand, there were differences in business performance
depending on business size and industry. The runaway cost of raw materials due to the sharp depreciation of the yen has taken
its toll on company profits, and some industries were not making good progress in improvement. Although there are signs ofincreased consumer spending in some areas of Shizuoka Prefecture because of expectations of increased pay due to better
company results, overall these overtones are rather mute.
It was in this context that we launched our 25th Medium-term Management Plan, which we call "Combined Rush '14-'15," inApril of 2014. We have made it our goal to "demonstrate the significance of our existence," and our three basic policies:"strengthen sales and support," "improve management quality," and "strengthen human resources" by rolling out efforts that will
strengthen our profit-making potential.
In order to expand upon our contact points with customers, we have revised our sales personnel by modifying our sales
structure and increasing the number of corporate and individual public relations staff to strengthen “corporate solutions” and“consulting for individuals.” We have concluded a letter of agreement on operational cooperation with the Japan Bank forInternational Cooperation as a means of increasing support for companies expanding overseas to offer joint financing forcustomers with subsidiaries overseas, also concluded a business cooperation memorandum with three branches of Japan
Finance Corporation in Shizuoka Prefecture to help those starting a business. Actively seeking out alliances with externalorganizations will help us improve our services that will respond to the diverse needs of customers and develop a support
system for those founding a business to bolster the local economy.We will improve our productivity and pursue higher efficiency
in order to strengthen our management foundation by performing operational reforms such as revising the flow of operations
and aim to have a low cost of operations through corporate cultural reforms that include fundamental reductions in expenses.
We have also started a short essay competition aimed at cultivating logical thinking as a part of developing the skills of bankstaff and also a role-playing competition that will give them sales skills they can apply in the real world. In conjunction with our
updated training system we have also introduced our J-Up Site exclusively for bank staff so that they can learn about ourculture on their own to provide the best service possible to customers.
We will strengthen our support structure for customers to improve the local economy by providing solutions appropriate to thelife stage of each individual customer, with all of the Shimizu Bank employees and executives coming together as one toembody a "demonstration of the significance of our existence" to contribute to creation in the local area.
August 2015

Katsuichiro Toyoshima
President

Noriji Yamada
Chairman
THE SHIMIZU BANK ,LTD.
2

From April 1,2014
to March 31,2016(Two years)

The 25th Medium‐term Management PlanCOMBINED RUSH '14-'15

In line with the 25th Medium-term Management Plan, the Shimizu Bank want to build relationships of trust by
deepening our local community-based financing and providing financial services appropriate to the life
stage of each individual customers, with all the Shimizu Bank employees and executives coming together
as one to embody a "demonstration of the significance of our existence."
In an effort to grow together with the region, bank employees will focus our combined power on carryingout our plans meant to allow us to adapt to changes in the business environment and adapt a brave
stance. We are calling our plan to do all this "Combined Rush '14-'15," and its three basic policies are"strengthen sales and support", "improve management quality", and "strengthen human resources".
Management Philosophy

Value social and public interests and pursue sound management of the company.
Make the Shimizu Bank which is familiar to, appreciated by, and useful for customers,
Create a workplace where workers respect personal relationships and are satisfied with their job requirements.
Ideal goals

Demonstrate the significance of our existence
Name

COMBINED RUSH '14-'15

From April 1, 2014 to March 31, 2016(Two years)
Basic Policy

Ⅰ.Strengthen sales and support

Ⅱ.Improve management quality

Ⅲ.Strengthen human resources

１．Expand our customer base
２．Strengthen marketing of solutions forcorporate clients
３．Strengthen marketing of consultation withretail clients
４．Expand and enhance contact with clients
５．Reconstruct our sales structure
６．Bolster support for management improvements
and business revitalization
７．Contribute to vitalization of the regional
economy１．Pursue improvements in business operations
and efficiency through BPR
２．Lower operating expenses
３．Strengthen market investment capabilities
４．Reinforce functions of, and cooperation
between group companies
５．Strengthen the business management
system
６．Foｒtify operational management systems
such as customer protection

１．Enhance the training system
２．Establish a climate that encourages self-study
３．Strengthen OJT
４．Familiariza staff with the new personnel
system

Support for Overseas Business Development
We made our efforts to continue to meet the customer needs of overseas business development throughexpansion of external network. In order to strengthen our support for customers' overseas businessadvancement, Shimizu Bank concluded a business cooperation agreement with the Japan Bank forInternational Cooperation (JBIC) in June 2014, and addressed joint loans with JBIC for equipment funds andloans financed in local currencies.In addition, in order to support development in overseas sales channels,in September 2014 the Bank cosponsored the “FBC Shanghai 2014” (Japan-China Factory-Network Business
Conference) together with the Shizuoka International Business Association, and assisted our customers’participation in business negotiations.
Customer

THE SHIMIZU BANK
Consultation【Support for overseas business 】●Provision of information●Business support●Consultation etc.

■Trade business■Overseas business

External network
Consultation

AdviceAdvice■Overseas information■Funding
Introduction

Cooperation【Support for foreign exchange】●Foreign exchange(Remittance, L/C）
●Trade consultation●Examination of Standby Credit■Shizuoka International
Business Association（SIBA）■Daiwa Securities Co.,Ltd■The Japan Bank for
Intemational Cooperation(JBIC)■Cooperators under MOU with
the JBIC
・Kasicorn Bank(Thailand)
・Bank Negara Indonesia（Indonesia)
・State Bank of India（India）
・Metro Bank（Philippines）
・Vietcom Bank（Vietnam）■Bank of Communication■Orix Corporation■Major consulting company●Provision of information：Market trends, laws regulations and subsidy of foreign country and various seminars.
●Business support: Introduction of International fair and business conference, On‐ｓｉｔｅ inspection●Consultation：Cosponsored by business conference, Trade consultation, Import and exporttransactions, Advice for establishment of overseas subsidiary etc

THE SHIMIZU BANK ,LTD.
3

Mt. Fuji - our symbol -Photo by Masakazu Ochiai

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 and handed it since 1969and have been using a corporate logo since 1974 whose design includes images of
Mt. Fuji and Gulf of Suruga. Mt. Fuji is very important existence for us.
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.
Since 1990, we have adopted the designof Ryohei Yanagihara, the famous painter,to our bank book. It is mainly "sea, port andships" associated with Shimizu city locatedour headquarters, with Mt. Fuji and the lightsky.
It's very familiar with our customers for along time.

THE SHIMIZU BANK ,LTD.
4

Summary of Business
Consolidated Results
Operating income was JPY 29.07 billion, a decrease of JPY 1.195 billion from the previous term, mainly because of decreases ininterest and dividends on securities. Operating expenses were JPY 24.454 billion, a decrease of JPY 2.15 billion from the previous
term, because of a decrease in credit-related expenses, etc. Consequently, operating profit was JPY 4.615 billion, a JPY 955
million increase from the previous term.
Deposits increased to JPY 1,399.7 billion, an increase of JPY 22.2 billion from the end of the preceding term, as a result of ourefforts to expand the business base in the local community. The total of personal assets under management increased by JPY
23.5 billion from the end of the last term to JPY 1,071.8 billion, due to an increase in personal deposits and a steady increase insales of investment trusts etc., while accommodating the diversifying needs of customers.
On account of positively meeting capital demands from customers as a regional banking institution, outstanding loans anddiscounts reached JPY 1,045.6 billion, an increase of JPY 14.2 billion from the end of the prior term.
Outstanding securities increased by JPY 16.9 billion from the previous year-end to JPY 318.1billion, as a result of agile securities
management while watching market trends.
(Millions of Yen)

Consolidated Five-ｙｅａｒｓ Summary

2011

2012

2013

2014

2015

Ordinary Income
Ordinary Profit
Net Income
Comprehensive Income
Net Assets
Total Assets¥30,788
3,545
3,037
843

¥29,304
4,453
1,636
3,755

66,702
1,416,408

69,8791,408,745¥29,636
3,518
2,430
5,868
74,432
1,488,023¥30,265
3,660
2,077
668
74,2501,494,830¥29,070
4,615
3,400
7,463
80,717
1,591,910

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

6,703.33
318.34

7,026.55
171.537,571.05
254.727,552.19
217.788,329.77
356.45

Non‐Consolidated Results
Operating revenue was JPY 24.459 billion, a decrease of JPY 1.06 billion from the previous term, mainly due to decreases ininterest and dividends on securities. Operating expenditures were JPY 19.995 billion, a decrease of JPY 2.019 billion from theprevious term, because of a decrease in credit-related expenses, etc.
As a result, operating profit was JPY 4.464 billion, an increase of JPY 958 million from the previous term, while net earnings were
JPY 2.527 billion, an increase of JPY 0.528 billion from the previous term.
(Millions of Yen)

Non-Consolidated Five-ｙｅａｒｓ Summary

2011

2012

2013

2014

2015

Ordinary Income
Ordinary Profit
Net Income
Common Stock
Net Assets
Total Assets
Deposits
Loans and Bills Discounted
Securities¥25,333
3,265
3,078
8,670
63,394
1,409,868
1,292,464
969,457
295,382¥24,506
4,191
1,644
8,670
66,4781,402,363
1,309,404
979,731
338,770¥24,905
3,238
1,824
8,670
71,0601,482,692
1,350,435
1,017,400
285,174¥25,520
3,505
1,999
8,670
70,974
1,487,974
1,382,325
1,036,413
301,501¥24,459
4,464
2,527
8,670
77,161
1,584,920
1,404,405
1,050,470
318,442Net Assets per Share in Yen
Cash Dividends per Share in Yen
Net Income per Share in Yen

6,643.52
60
322.61

6,967.52
60
172.37

7,448.37
60
191.247,440.33
60
209.558,089.85
60
264.99Deposits(Millions of Yen )(Millions of Yen )1,404,405

1,400,000

1,382,325

Net Income(Millions of Yen )1,050,470

1,050,000

3,078

1,036,413

3,000

1,017,400

1,025,000

1,375,000

2,527

1,350,435

1,350,000

2,500

1,000,000
975,000

1,325,000
1,300,000

Loans and Bills Discounted

969,457

979,731

1,292,464

1,999

2,000

1,309,404

1,824
1,644

950,000
1,500

925,000

1,275,000
1,250,000

2011

2012

2013

2014

2015

900,000

1,000

2011

2012

2013

2014

2011

2015

2012

2013

2014

2015

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.

AAA
AA
A
BBB

A

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 31, 2015)

THE SHIMIZU BANK ,LTD.
5

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.

Board of Directors■Compliance System
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 and International Division
Report, Contact, Consult

Block Compliance Supervisor
Block Compliance Officer
Compl iance 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 havealready recognized as a top priority, we will continue
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
Administrative 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 andin 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.
6

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 thedeposits 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 the provisions,
the Bank draws up “Risk Management Regulations” and “Risk Management Procedures” according to various risk
categories which prescribe the specific management methods, etc., as well as reporting to the Board of Directors andthe Management Committee. The Bank formulates its risk management plan every fiscal year to control 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 Supervisory Office,Corporate Administration Division

Orerational risks
Credit risksMarket risks

Liquidity risks

Administrativerisks

System risks

Legal risks

Reputationalrisks

Other risks

Departments concerned in risks

Audit
Division
Risk Supervisory Office, Corporate Administration Division

CreditDepartment

Risk
Supervisory
Office,Corporate
Admnistration
Division

Risk
Supervisory
Office,Risk
Corporate
Supervisory
Legal Office,Each Division
Admnistration Administrative Administrative
Office,Corporate
at
Division
Corporate
Administration
Division
Division
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.
7

Risk Management System
Management of credit risks
Shimizu Bank collectively administers loans and bills discounted, assets with a credit risk, and off-balance sheet assets,managing credit risks 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 risks 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 risks to securely earn stable profits through market transactions. The Bank has
installed both a front office and back office in the Market Sales Department, as well as a middle office in the Risk
Supervisory Office of the Comprehensive Supervisory Department, 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 Market Sales Department, which is a fund raising
management section, while the Risk Supervisory Office of the Comprehensive Supervisory Department, 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 risks, system risks, legal risks, reputational risks, and other risks as operational risks;endeavors to prevent such risks from becoming tangible; and minimizes the impacts caused by such risks when they
become apparent.
Regarding administrative risks, 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 Audit Department 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 risks are risks 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 risks,and vigorously addresses actions to strengthen our preparedness to further observe laws and regulations.
Reputational risks are risks 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 risks, 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.
8

Corporate Data
Consolidated Balance Sheets(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

March 31,2014

March 31,2015

March 31,2015

AssetsCash and Due from Banks
Call Loans
Trading Account Securities
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchanges
Lease Receivables and Investment Assets
Other Assets
Tangible Fixed Assets
Building, Net
Land
Lease Assets, Net
Construction in Progress
Other Tangible Fixed Assets
Intangible Fixed Assets
SoftwareLease Assets
Others Intangible Fixed Assets
Net Defined Benefit Assets
Deferred Tax Assets
Customers' Liabilities for Acceptances and Guarantees
Allowance for Loan Losses
Total Assets¥123,208
5,000
253
1,800
301,265
1,031,426
590
9,543
5,070
20,311
9,545
9,174
207
1,384
802
611
18
173
2,336
2,756
(9,536)
1,494,830¥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

US$1,615,173
‐
1,843
9,997
2,647,699
8,701,261
4,345
80,65068,949162,472
74,66077,291
653
1
9,866
7,268
5,854
73
1,340
3,976
2,747
23,077(82,308)
13,247,155(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

March 31,2014

March 31,2015

March 31,2015

Liabilities
Deposits
Negotiable Certificates of Deposit
Borrowed Money
Foreign Exchanges
Bonds Payable
Other Liabilities
Provision for Bonuses
Net Defined Benefit Liabilities
Provision for Directors' Retirement Benefits
Provision for Reimbursement of Deposits
Deferred Tax Liabilities
Acceptances and Guarantees
Total Liabilities¥1,377,456
10,45416
18,000
7,813
529
3,379
115
58
2,756
1,420,580¥1,399,738
68,215
19,78826
10,000
7,257
522
2,361
106
45
357
2,773
1,511,193

US$11,647,990
567,658
164,670
224
83,21560,392
4,344
19,654
884
375
2,978
23,077
12,575,464

8,670
5,272
55,129(290)
68,781
3,452
0
(191)
3,260
2,208
74,2501,494,830

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

72,15143,877
486,609(2,446)600,191
59,7252
1,228
60,956
10,542
671,690
13,247,155

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
Minority Interests
Total Net Assets
Total Liabilities and Net Assets

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 ￥120.17per U.S.$1, the approximate rate of exchange prevailing on March 31,2015.

THE SHIMIZU BANK,LTD.

9

Consolidated Statement of Income(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

Years ended
March 31,2014

Years ended
March 31,2015

Years ended
March 31,2015

Ordinary Iｎｃｏｍｅ¥30,265¥29,070

US$241,907

Interest Income

18,404

18,320152,455

Interest on Loans and Discounts

14,866

14,028116,741

Interest and Dividends on Securities

3,481

4,213

35,059Interest on Call Loans

20

1

9

Interest on Deposits with Banks

34

76

636

0

0

7

7,929
1,515

8,162
1,056

67,923
8,794

2,415

1,530

12,733

1

2

17

2,414

1,528

12,71526,604
1,249

24,454
1,254

203,498
10,442

892
5

862
82

7,180
689

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

44

11

93

Interest on Borrowings and Rediscounts

54

64

532

Interest on Bonds

220

229

1,905

Interest on Bonds with Subscription Rights
to Shares
Other Interest Expenses

5

-

-

26

4

41

4,575

4,475

37,239

195

314

2,617

General and Administrative Expenses

17,441

17,180142,968

Other Expenses

3,143

1,229

10,229

2,516

985

8,200

626

243

2,029

3,660

4,615

38,409
7,807

Fees and Commissions Payments
Other Ordinary Expenses

Provision of Allowance for Loan Losses
OthersOrdinary Profit
Extraordinary Income

84

938

Gain on Disposal of Fixed Assets

84

-

-

Gain on Bargain Purchase

-

938

7,807

17

84

700

1

4

36

Impairment Loss
Income Before Income Taxes
Income Taxes - Current
Income Taxes - Deferred

15
3,727
1,289

79
5,469
1,488

664
45,515
12,385

285

567

4,723

Total Income Taxes

1,575

2,055

17,108

Income Before Minority Interests

2,152

3,413

28,406

74

13

112

2,077

3,400

28,293Extraordinary Losses
Loss on Disposal of non-Current Assets

Minority Interests in Income
Net Income

Consolidated Statement of Comprehensive Income
Income Before Minority Interests
Other Comprehensive Income
Valuation Difference on Available-for-Sale
Securities
Deferred Gains or Losses on Hedges
Remeasurements of Defined Benefit Plans
Comprehensive Income(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

Years ended
March 31,2014

Years ended
March 31,2015

Years ended
March 31,2015¥2,152(1,484)¥3,413
4,050

US$28,406
33,705(1,484)
0

3,710
0
339

30,876
2
2,826

7,463

62,111

668

Comprehensive Income Attributable to
Owners of the Parent

578

7,464

62,119Comprehensive Income Attributable to
Minority Interests

89

(0)

(7)

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 ￥120.17per U.S.$1, the approximate rate of exchange prevailing on March 31,2015.

THE SHIMIZU BANK,LTD.
10

Consolidated Statements of Changes in Equity
Years ended

March 31,2014(Millions of Yen)

Shareholders' Equity
Capital Stock
Balance at the Beginning of Current Period

Capital Surplus¥8,670Retained Earnings¥5,272

Cumulative Effects of Changes in Accounting Policies
Restated Balance

Total Shareholders'EquityTreasury Shares¥53,624(¥287)¥67,279(287)

67,279

8,670

5,272

-

53,624

Changes of Items During Period
Dividends of Surplus

(572)

(572)

Net Income

2,077

2,077

Purchase of Treasury Shares
Disposal of Treasury Shares

(3)

(3)

-

-

-

Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period

-

-

1,505

(3)

1,501

Balance at the End of Current Period

8,670

5,272

55,129(290)

68,781

Accumulated Other Comprehensive Income
Valuation
Difference on
Available-for-Sale
Securities
Balance at the Beginning of Current Period

Deferred Gains(Losses) on
HedgesRemeasurementsof Defined Benefit
Plans

Total
Accumulated
Other
Comprehensive
IncomeMinority Interests

Total Net Assets¥4,951(¥0)-¥4,951¥2,201¥74,432
-

4,951

(0)

-

4,951

2,201

74,432

Cumulative Effects of Changes in Accounting Policies
Restated Balance
Changes of Items During Period
Dividends of Surplus(572)

Net Income

2,077
(3)

Purchase of Treasury Shares-

Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity(1,499)0(191)(1,691)

Total Changes of Items During Period(1,499)0(191)(1,691)

6(182)

Balance at the End of Current Period

3,452

0

(191)

3,260

2,208

74,250Years ended

March 31,2015

6(1,684)(Millions of Yen)

Shareholders' Equity
Capital Stock
Balance at the Beginning of Current Period

Capital Surplus¥8,670¥5,272

Treasury Shares¥55,129

8,670

5,272

Total Shareholders'Equity(¥290)¥68,781(290)

69,300518

Cumulative Effects of Changes in Accounting Policies
Restated Balance

Retained Earnings

518

55,648Changes of Items During Period
Dividends of Surplus

(572)

(572)

Net Income

3,400

3,400

Purchase of Treasury Shares(0)

Disposal of Treasury Shares

(3)

(3)

0

0

Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period

-

(0)

2,827

(3)

2,824

Balance at the End of Current Period

8,670

5,272

58,475(294)

72,125

Accumulated Other Comprehensive Income

Balance at the Beginning of Current Period

Valuation
Difference on
Available-for-Sale
Securities

Deferred Gains(Losses) on
HedgesRemeasurementsof Defined Benefit
Plans

Total
Accumulated
Other
Comprehensive
Income¥3,452¥0(¥191)

3,452

0

(191)

Minority Interests

Total Net Assets¥3,260¥2,208¥74,250

3,260

2,208

74,768518

Cumulative Effects of Changes in Accounting Policies
Restated Balance
Changes of Items During Period
Dividends of Surplus(572)

Net Income

3,400
(3)

Purchase of Treasury Shares

0

Disposal of Treasury Shares

3,724

0

Total Changes of Items During Period

3,724

0

339

4,064

(941)

5,948

Balance at the End of Current Period

7,177

0

147

7,325

1,266

80,717

Net Changes of Items Other Than Shareholders' Equity

339

4,064

(941)

3,123

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 ￥120.17per U.S.$1, the approximate rate of exchange prevailing on March 31,2015.

THE SHIMIZU BANK,LTD.
11

Consolidated Statements of Changes in Equity
Years ended

March 31,2015(Thousands of U.S.Dollars)

Shareholders' Equity
Capital Stock
Balance at the Beginning of Current Period

Capital Surplus

US$72,151

US$43,877

Cumulative Effects of Changes in Accounting Policies
Restated Balance

Retained Earnings

Treasury Shares

US$458,760(US$2,420)

US$572,369(2,420)576,687

4,318
72,15143,877

Total Shareholders'Equity4,318

463,079

Changes of Items During Period
Dividends of Surplus(4,762)Net Income

28,293(4,762)
28,293Purchase of Treasury Shares(0)

Disposal of Treasury Shares

(26)

(26)

0

0

Net Changes of Items Other Than Shareholders' Equity
Total Changes of Items During Period
Balance at the End of Current Period

72,151(0)

23,530(26)

23,50443,877

486,609(2,446)600,191

Accumulated Other Comprehensive Income

Balance at the Beginning of Current Period

Valuation
Difference on
Available-for-Sale
Securities

Deferred Gains(Losses) on
HedgesRemeasurementsof Defined Benefit
Plans

Total
Accumulated
Other
Comprehensive
Income

US$28,728

US$0(US$1,597)

US$27,131

US$18,374

US$617,874

28,7280(1,597)

27,131

18,374622,192

Minority Interests

Cumulative Effects of Changes in Accounting Policies
Restated Balance

Total Net Assets

4,318

Changes of Items During Period
Dividends of Surplus(4,762)Net Income

28,293Purchase of Treasury Shares(26)
0

Disposal of Treasury Shares
Net Changes of Items Other Than Shareholders' Equity

30,9972

Total Changes of Items During Period

30,997

Balance at the End of Current Period

59,7252,826

33,8252

2,826

33,825(7,832)49,4972

1,228

60,956

10,542

671,690(7,832)25,993

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 ￥120.17per U.S.$1, the approximate rate of exchange prevailing on March 31,2015.

THE SHIMIZU BANK,LTD.
12

Consolidated Statement of Cash Flows(Millions of Yen)

(Millions of Yen)

(Thousands of U.S.Dollars)

Years ended
March.31,2014

Years ended
March.31,2015

Years ended
March.31,2015

Cash Flows from Operating Activities
Income Before Income Taxes¥3,727¥5,469

US$45,515

Depreciation and Amortization

1,386

1,302

10,842

Impairment Loss

15

79

664

Gain on Disposal of Fixed Assets

(84)

-

-

-

(938)

(7,807)

Increase (Decrease) in Allowance for Loan Losses

(402)

354

2,953

Increase (Decrease) in Reserve for Employees' Bonuses

(30)

(7)

(59)

(3,190)

-

-

-

(183)

(1,523)(6,675)Gain on Bargain Purchase

Increase (Decrease) in Reserve for Employees' Retirement Benefits
Increase (Decrease) in Net Defined Benefit Assets

3,085

(802)

Increase (Decrease) in Reserve for Directors' Retirement Benefits

5

(9)

(80)

Increase (Decrease) in Provision for Reimbursement of Deposits

22

(12)

(108)
(152,455)

Increase (Decrease) in Net Defined Benefit Liability(18,404)(18,320)

Financial Expenses

1,249

1,254

10,442

Loss (Gain) Related to Securities(3,059)(2,013)(16,755)

Loss (Gain) on Money Held in Trust

(12)

(11)

(98)

1

4

36

Net Decrease (Increase) in Trading Account Securities

(47)

31

266

Net Decrease (Increase) in Loans and Bills Discounted(20,038)(14,204)(118,201)Net Increase (Decrease) in Deposits

31,45622,282

185,422Net Increase (Decrease) in Negotiable Certificates of Deposit(31,900)

68,215567,658

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

6,408

9,333

77,672

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

(131)

(151)

(1,260)Net Decrease (Increase) in Call Loans

65,0005,000

41,607Net Increase (Decrease) in Call Money(3,978)

-

-

134

68

565

Gain on Fund Management

Loss (Gain) on Disposal of non-current Assets

Net Decrease (Increase) in Foreign Exchange Assets
Net Increase (Decrease) in Foreign Exchange Liabilities

6

10

85

150

(629)

(5,236)

Proceeds from Fund Management

18,884

18,550154,367

Payments for Finance(1,389)(1,340)(11,152)

Other, net(4,304)(7,682)(63,928)

Subtotal

44,56185,652

712,759

Net Decrease (Increase) in Lease Receivables and Investment Assets

Income Taxes Paid
Net Cash Provided by (Used in) Operating Activities(757)(1,692)(14,080)

43,80383,960698,678

Cash Flows from Investing Activities
Purchases of Securities(200,733)(426,436)(3,548,612)

Proceeds from Sales of Securities

151,660

416,469

3,465,666

Proceeds from Maturities of Securities

37,843

5,849

48,677

11

611

5,086

Purchases of Property, Plant and Equipment

(317)

(813)

(6,771)

Purchases of Intangible Fixed Assets

(168)

(338)

(2,817)

Proceeds from Sales of Property, Plant and Equipment

101

168

1,400

(11,601)(4,490)(37,368)

Decrease in Money Held in Trust

Net Cash Provided by (Used in) Investing Activities

Cash Flows from Financing Activities
(570)

(571)

(4,754)

Cash Dividends Paid to Minority Shareholders

(2)

(2)

(17)

Purchases of Treasury Shares

(3)

(3)

(26)

-

0

0

(175)

(147)

(1,228)Cash Dividends Paid

Proceeds from Sales of Tresury Shares
Repayments of Lease Liabilities
Redemption of Bonds with Warrants(5,999)--Issuance of Subordinated Bonds

10,000--

Redemption of Subordinated Bonds
Net Cash Provided by (Used in) Financing Activities

Effect of Exchange Rate Changes on Cash and Cash Equivalents

3,249(8,000)(66,572)(8,724)(72,598)

(5)

(9)

(82)

Net Increase (Decrease) in Cash and Cash Equivalents

35,44570,735

588,628

Cash and Cash Equivalents at Beginning of Period

86,319

121,765

1,013,275

Cash and Cash Equivalents at End of Period

121,765

192,500

1,601,903

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 ￥120.17per U.S.$1, the approximate rate of exchange prevailing on March 31,2015.

THE SHIMIZU BANK,LTD.
13

Board of Directors and Corporate Auditors●Chairman(Representative Director)
Noriji Yamada●Managing Directors
Shigeru Nonoyama●President(Representative Director)
Katsuichiro Toyoshima●Directors
Sumiko Suzuki●Corporate Auditors
Kazuhito Kobayashi

Ayato Mochizuki

As of June 30,2015●Managing Executive Officers
Syuji Sano

Akihiro Sei

Masashi Harada

Youichiro Ito

Fumitoshi Yabuzaki

Kazuaki Isobe

Yoshiaki Harada

Fujio Kaneda●Senior Managing Director
Akihiro Mochizuki

Keiko Higashi
Naoyuki Shirakawa
Syunji Usami
Yasuhiro Iwayama

Organization Chart

As of March 31,2015

General Meeting of Shareholders

Directors

Board of Directors

Management Planning
Division

Chairman

Board of Auditors

Auditors

Secretariat OfficeBusiness Information Office TokyoManagement Committee
President

Business Information Office Nagoya

Deputy President
Senior Managing Director

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

Customer
Branches
Branch Advisory Division

Customer Services Office
Loan Center

Markets and International
Division

Securities Office

Credit DivisionCorporate Support Division
Operations Division

Operations Center Office

Loan Administration OfficeInternal Audit Division

TEL 81-54-353-5164 SWIFT : SMZGJPJT
http://www.shimizubank.co.jp/

THE SHIMIZU BANK,LTD.
14