May 28, 2020

Financial Results for the Fiscal Year Ended March 31, 2020
Asahi Mutual Life Insurance Company (the “Company”; President: Hiroki Kimura) announces financial
results for the fiscal year ended March 31, 2020

［Contents］
１．Business Highlights

･････

Ｐ１

２．Investment Results of General Account Assets

･････

Ｐ4

３．Unaudited Non-consolidated Balance Sheets

･････

Ｐ9

４．Unaudited Non-consolidated Statements of Income

･････

Ｐ11

５．Breakdown of Ordinary Profit (Fundamental Profit)

･････

Ｐ29

６．Unaudited Non-consolidated Statements of Changes in Net Assets

･････

Ｐ30

７．Unaudited Non-consolidated Statements of Proposed Appropriation of Surplus

･････

Ｐ32

８．Disclosed Claims Based on Categories of Obligors

･････

Ｐ33

９．Risk-monitored Loans

･････

Ｐ34

10．Solvency Margin Ratio

･････

Ｐ35

11．Status of Separate Account

･････

Ｐ36

12．Status of the Company, Subsidiaries and Affiliates

･････

Ｐ38

Asahi Mutual Life Insurance Company

1．Business Highlights(1) Sum Insured of Policies in Force and New Policies(i) Policies in Force
As of March 31, 2019
Number of policies

As of March 31, 2020

Amount (100 millions of Yen)

(Thousands)

Changes(%, Pre-FYE)

Individual insurance

7,207

100.3

Individual annuities

557

Group insuranceGroup annuities

Number of policies

Amount (100 millions of Yen)

Changes(%, Pre-FYE)(Thousands)

Changes(%, Pre-FYE)

Changes(%, Pre-FYE)

153,499

92.2

7,269

100.9

142,238

92.7

95.3

23,432

93.6

531

95.4

21,93693.6--

14,778

111.7

-

-

14,536

98.4

-

-

170

95.2

-

-

162

95.3

Notes:
1. Policy amounts for individual annuities are equal to (a) the funds to be held at the time annuity payments are to commence for an annuity
for which annuity payments have not yet commenced and (b) the amount of policy reserves for an annuity for which payments havecommenced.
2. Policy amount in force for group annuities is equal to the amount of outstanding policy reserves.
3. Number of policies includes number of each unit with regard to "Hoken-ou" , "Hoken-ou Plus", etc.

(ii) New Policies
Year ended March 31, 2019
Number of policies(Thousands)

Amount (100 millions of Yen)

Changes(%, YoY)

Changes(%, YoY)

New
policies

Net increase by
conversion

Individual insurance

680

97.0

1,590

124.1

3,053

(1,462)

Individual annuities

-

-

(165)

-

-

(165)

Group insurance

-

-

1,335

532.2

1,335

-

Group annuities

-

-

-

-

-

-

Year ended March 31, 2020
Number of policies(Thousands)

Amount (100 millions of Yen)

Changes(%, YoY)

Changes(%, YoY)

New
policies

Net increase by
conversion

Individual insurance

741

108.9

1,604

100.9

3,001

(1,397)

Individual annuities

-

-

(158)

-

-

(158)

Group insurance

-

-

124

9.3

124

-

Group annuities

-

-

-

-

-

-

Notes:
1. Number of new policies is the sum of new policies and policies after conversion.
2. Amount of new policies for individual annuities, both new policies and net increase by conversion, is equal to
the funds to be held at the time annuity payments are to commence.
3. Number of policies includes number of each unit with regard to "Hoken-ou" , "Hoken-ou Plus", etc.

1Asahi Mutual Life Insurance Company

(2) Annualized Premiums(i) Policies in Force(100 millions of Yen）

As of March 31, 2019

As of March 31, 2020

Changes(%, Pre-FYE)

Changes(%, Pre-FYE)

Individual insurance

3,953

103.7

3,916

99.0

Individual annuities

1,451

96.0

1,391

95.9

Total

5,405

101.5

5,307

98.2

2,102

101.9

2,157

102.6

Third-sector products(ii) New Policies(100 millions of Yen）

Year ended March 31, 2019Year ended March 31, 2020

Changes(%, YoY)

Changes(%, YoY)

Individual insurance

418

128.9

253

60.6

Individual annuities

(3)

-

(3)

-

414

129.3

250

60.3

174

81.0

207

118.6

Total
Third-sector products

Notes:
1. Annualized premiums are calculated by multiplying factors according to the premium payment method(for single premium contracts, the amount is calculated by dividing the premium by the coverage period).
2. Figures for third-sector products represent portion of annualized premiums corresponding to the medical
benefits (hospitalization benefits, surgery benefits, etc.), living benefits (specific illness benefits, nursing
care benefits, etc.) and waiver benefits (excluding disability benefits, but including specific illness benefits
and nursing care benefits).

2

Asahi Mutual Life Insurance Company

（3）Selected Financial Data
(100 millions of Yen）

Year ended March 31, 2019Year ended March 31, 2020

Changes(%, YoY)

Changes(%, YoY)

Premium and other income

3,967

103.1

3,936

99.2

Investment income

1,526

91.6

1,397

91.6

Claims and other payments

4,182

95.3

4,065

97.2

Investment expenses

562

145.9

427

75.9

Ordinary profit

246

65.6

310

126.1

（4）Proposed Appropriation of Surplus(100 millions of Yen）

Year ended March 31, 2019Year ended March 31, 2020

Changes(%, YoY)

Changes(%, YoY)

Unappropriated surplus

313

83.9

388

124.2

Reversal of voluntary surplus reserves

19

461.7

2

11.7

Reserve for dividends to policyholders

21

110.7

17

82.6

Net surplus

132

70.1

131

99.7

Surplus carried forward

178

105.5

241

135.1

（5）Total Assets(100 millions of Yen）

As of March 31, 2019

As of March 31, 2020

Changes(%, Pre-FYE)
Total assets

Changes(%, Pre-FYE)

53,563

99.3

53,886100.6

3

Asahi Mutual Life Insurance Company

２．Investment Results of General Account Assets(1) Asset Composition(Millions of Yen)

Cash, deposits, call loans
Monetary claims bought
Securities
Domestic bonds
Domestic stocks
Foreign securities
Foreign bonds
Foreign stocks and other foreign securities
Other securities
Loans
Policy loans
Industrial and consumer loans
Real estate
Deferred tax assets
OthersAllowance for possible loan losses
Total
Foreign currency-denominated assets

As of March 31, 2019

As of March 31, 2020

Amount174,143
28,9844,232,046
2,770,086
311,699
1,078,849
893,733
185,115
71,411
426,804
44,272
382,531
383,194
10,41373,596(375)
5,328,808
1,212,135

Amount109,934
26,915
4,353,404
2,722,203
282,473
1,285,061
1,063,892
221,169
63,666377,91340,553
337,359
377,871
8,044
110,577(391)
5,364,268
1,394,173

Percentage
3.3
0.5
79.4
52.0
5.8
20.2
16.8
3.5
1.3
8.0
0.8
7.2
7.2
0.2
1.4
(0.0)
100.0
22.7

Percentage
2.0
0.5
81.2
50.7
5.3
24.0
19.8
4.1
1.2
7.0
0.8
6.3
7.0
0.1
2.1
(0.0)
100.0
26.0

(2) Changes(Increases/Decreases) in Assets(Millions of Yen)

Cash, deposits, call loans
Monetary claims bought
Securities
Domestic bonds
Domestic stocks
Foreign securities
Foreign bonds
Foreign stocks and other foreign securities
Other securities
Loans
Policy loans
Industrial and consumer loans
Real estate
Deferred tax assets
OthersAllowance for possible loan losses
Total
Foreign currency-denominated assets

Year ended March 31, 2019
Amount(20,158)(1,167)70,994(75,604)(11,418)
161,702202,821(41,119)(3,685)(57,365)(5,364)(52,000)(11,437)(5,773)(13,488)18(38,377)
157,598

4

Year ended March 31, 2020
Amount(64,209)(2,069)121,357(47,882)(29,226)
206,211
170,158
36,053(7,745)(48,891)(3,719)(45,172)(5,323)(2,369)36,980(15)
35,459182,037

Asahi Mutual Life Insurance Company

（3）Investment Income(Millions of Yen)
Year ended March 31, 2019 Year ended March 31, 2020
Interest, dividends and other income
Interest on deposits
Interest and dividends on securities

107,892

108,7050083,13885,179Interest on loans

7,096

5,949

Rent revenue from real estate

16,637

16,606

Other interest and dividends

1,019

970

Gains on sales of securities

34,64823,852

Gains on sales of domestic bonds

32,424

21,832

Gains on sales of domestic stocks and other securities

1,685

2,018

538

1

Gains on sales of foreign securities--

Gains on redemption of securities

Others-50

Gains on derivative financial instruments, net

-

-

2,258

-

14

-

7,476

7,167

152,290

139,776

Foreign exchange gains, net
Reversal of allowance for possible loan losses
Other investment income
Total（4）Investment Expenses(Millions of Yen)
Year ended March 31, 2019 Year ended March 31, 2020
Interest expenses

4,700

4,526

Losses on sales of securities

12,520

2,810

2,224

690

Losses on sales of domestic bonds
Losses on sales of domestic stocks and other securities

800

2,120

9,495

-

-

-

628

368

-

-

628

368

Losses on valuation of foreign securities--

Others

-

-

-

140

Losses on sales of foreign securities
Others
Losses on valuation of securities
Losses on valuation of domestic bonds
Losses on valuation of domestic stocks and other securities

Losses on redemption of securities
Losses on derivative financial instruments, net

22,923

16,588Foreign exchange losses, net

-

2,057

Provision for allowance for possible loan losses-

8

Write-offs of loans

00Depreciation of rental real estate and other assets

5,361

5,327

Other investment expenses

10,104

9,761

56,23941,591Total

5Asahi Mutual Life Insurance Company

（5）Investment Indicators(i) Rates of Return（％）
Year ended March 31, 2019Year ended March 31, 2020

Cash, deposits, call loans

0.00

0.00

Monetary claims bought

2.27

2.33

Securities

2.05

2.07

Domestic bonds

2.42

2.16

Domestic stocks

5.45

4.53

Foreign securities

0.55

1.48

1.23

1.19

0.87

0.83

Real estate

2.52

2.60

Total

1.80

1.86

0.54

1.48

Loans
Industrial and consumer loans

Foreign Investments
Notes:

１．Rates of return above are calculated by dividing the net investment income by the average daily
book value balance.
２．Foreign investments are the sum of assets denominated in foreign currencies and yen.

(ii) Average Daily Balance(Millions of Yen)
Year ended March 31, 2019Year ended March 31, 2020

Cash, deposits, call loans

189,972

98,121

Monetary claims bought

29,61827,804

4,148,801

4,252,586

Domestic bonds

2,793,247

2,747,700

Domestic stocks

178,131

186,419

Foreign securities

1,100,243

1,240,474

458,826

403,658

411,582

361,213396,407384,306

5,329,150

5,264,766

1,102,199

1,242,882

Securities

Loans
Industrial and consumer loans
Real estate
Total
Foreign Investments

Note:Foreign investments are the sum of assets denominated in foreign currencies and yen.

6

Asahi Mutual Life Insurance Company

(ⅲ) Net Valuation Gains/Losses on Trading Securities(Millions of Yen)
As of March 31, 2020
Net valuation
gains(losses)
Amountincluded in thestatements of income-

As of March 31, 2019
Net valuation
gains(losses)
Amountincluded in thestatements of income-

Trading securities(ⅳ) Fair Value Information on Securities (with fair value, other than trading securities)(Millions of Yen)
As of March 31, 2019
Book value Fair value

As of March 31, 2020

Gains/losses
Gains

Held-to-maturity debt
securities
Policy-reserve-matchingbonds
Stocks of subsidiaries

391,680

46,867

46,872

2,074,484 2,407,849

333,364

335,418---

Available-for-sale securities

1,682,582 1,811,255

128,673

175,552

344,812-Book value Fair value

Gains/losses

LossesGains(5)

Losses373,755

39,28839,294(5)(2,053) 2,050,330 2,353,584

303,254304,294(1,040)-334,467

-

-

-

-

(46,878) 1,845,623 1,975,488-

129,864

192,293(62,429)

Domestic bonds

530,817534,228

3,410

10,624(7,213)507,110

518,502

11,392

15,757(4,364)

Domestic stocks

160,295

291,232

130,937

142,919(11,982)

169,376

262,450

93,073

116,456(23,382)

Foreign securities

916,943913,737(3,205)21,317(24,523) 1,093,700 1,129,950

36,24959,561(23,312)

Foreign bonds

736,455

738,633

2,177

20,629(18,452)

862,807

908,792

45,98458,080(12,095)

Foreign stocks andother foreign securities

180,487

175,104(5,383)688(6,071)

230,892

221,157(9,735)

1,481(11,216)

73,912

71,411(2,501)657(3,159)74,59563,666(10,929)439(11,369)

613

645

32

32

-

840

918

78

78

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Other securities
Monetary claims bought
Negotiable certificates ofdeposit
Others
Total
Domestic bonds
Domestic stocks
Foreign securities

-

-

-

-

-

-

-

4,101,879 4,610,785

508,906

557,843(48,937) 4,230,421 4,702,828

472,407535,882(63,475)

2,766,675 3,114,133

347,458

356,731(9,272) 2,710,810 3,033,735

322,924

328,335(5,411)

291,232

130,937

142,919(11,982)

262,450

93,073

116,456(23,382)

1,072,043 1,101,869

29,82654,349(24,523) 1,248,800 1,313,179

64,37887,691(23,312)(18,452) 1,017,907 1,092,021

74,114

86,209(12,095)

1,481(11,216)

160,295

169,376

Foreign bonds

891,556

926,765

35,20953,661

Foreign stocks andother foreign securities

180,487

175,104(5,383)688(6,071)

230,892

221,157(9,735)

Other securities

73,912

71,411(2,501)657(3,159)74,59563,666(10,929)439(11,369)

Monetary claims bought
Negotiable certificates ofdeposit
Others28,952

32,137

3,185

3,185

-

26,837

29,796

2,959

2,959

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Note: The table above includes assets which are considered appropriate to deem as securities under the Financial Instruments and Exchange Act.

* Book value of securities without fair value is as follows:(Millions of Yen)
As of March 31, 2019

As of March 31, 2020--

Unlisted foreign bonds--

Others--

Held-to-maturity debt securities

Policy-reserve-matching bonds--

Stocks of subsidiaries

6,649

6,694

Available-for-sale securities

23,82913,340Unlisted domestic stocks (except over-the-counter stocks)

13,817

13,327

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

10,012

12

Unlisted foreign bonds--

Others--30,47920,035Total

7Asahi Mutual Life Insurance Company

(ⅴ) Fair Value Information on Money Held in Trust
The Company doesn't hold money held in trust.
（6）Fair Value Information on Real estate (land)(Millions of Yen)
As of March 31, 2019
Book value
Land

230,624

As of March 31, 2020

Fair value Gains/losses Book value
270,345

39,720228,777

Fair value Gains/losses
289,81261,034

Notes:
1. Fair Value is calculated based on appraisal value for property tax and others.
2. The amount above includes leasehold.

(Reference)
The table below shows the sum of securities with fair value and without fair value (in case that securities without fair value are foreign currency-denominated,the fair value is calculated as the sum of book value and net unrealized gains (losses) on foreign exchange valuation).
(Millions of Yen)
As of March 31, 2019
Book value

Fair value

As of March 31, 2020

Gains/losses
Gains

Held-to-maturity debt
securities
Policy-reserve-matching
bonds

Fair value

Gains/losses

Losses344,812391,680

46,867

46,872

2,074,484

2,407,849

333,364

335,418

6,649

6,649

-

-

Available-for-sale securities 1,706,411

1,835,084

128,672

Stocks of subsidiaries

Book value

Gains

(5)

Losses334,467

373,755

39,28839,294(5)(2,053) 2,050,330

2,353,584

303,254304,294(1,040)

6,694

6,694

-

-

-

175,552(46,879) 1,858,964

1,988,827

129,863

192,293(62,430)-

Domestic bonds

530,817534,228

3,410

10,624(7,213)507,110

518,502

11,392

15,757(4,364)

Domestic stocks

174,112305,049

130,937

142,919(11,982)

182,704

275,778

93,073

116,456(23,382)

Foreign securities

926,956

923,749(3,206)

21,317(24,524) 1,093,713

1,129,961

36,24859,561(23,313)

Foreign bonds

736,455

738,633

2,177

20,629(18,452)

862,807

908,792

45,98458,080(12,095)

Foreign stocks andother foreign securities

190,500

185,115(5,384)688(6,072)230,905

221,169(9,736)

1,481(11,218)

73,912

71,411(2,501)657(3,159)74,59563,666(10,929)439(11,369)

Monetary claims bought

613

645

32

32

-

840

918

78

78

-

Negotiable certificates ofdeposit

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

4,132,358

4,641,264

508,905

557,843(48,938) 4,250,456

4,722,862

472,406

535,882(63,476)

Domestic bonds

2,766,675

3,114,133

347,458

356,731(9,272) 2,710,810

3,033,735

322,924

328,335(5,411)

Domestic stocks

180,761

311,699

130,937

142,919(11,982)

189,399

282,473

93,073

116,456(23,382)

Foreign securities

1,082,056

1,111,881

29,82554,349(24,524) 1,248,813

1,313,190

64,377

87,691(23,313)

Foreign bonds

891,556

926,765

35,20953,661(18,452) 1,017,907

1,092,021

74,114

86,209(12,095)

Foreign stocks andother foreign securities

190,500

185,115(5,384)688(6,072)230,905

221,169(9,736)

1,481(11,218)

Other securities

73,912

71,411(2,501)657(3,159)74,59563,666(10,929)439(11,369)

Monetary claims bought

Other securities

Total

28,952

32,137

3,185

3,185

-

26,837

29,796

2,959

2,959

-

Negotiable certificates ofdeposit

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

Note: The table above includes assets which are considered appropriate to deem as securities under the Financial Instruments and Exchange Act.

8

Asahi Mutual Life Insurance Company

３．Unaudited Non-consolidated Balance Sheets
As of March 31, 2019
Assets:Cash and deposits:
Cash
Deposits
Call loans
Monetary claims bought
Securities:
National government bonds
Local government bonds
Corporate bonds
Domestic stocks
Foreign securities
Other securities
Loans:
Policy loans
Industrial and consumer loans
Tangible fixed assets:
Land
Buildings
Lease assets
Construction in progress
Other tangible fixed assets
Intangible fixed assets:
Software
Other intangible fixed assets
Agency accounts receivable
Reinsurance receivables
Other assets:
Accounts receivable
Prepaid expenses
Accrued income
Money on deposit
Derivative financial instruments
Cash collateral paid for financial instruments
Suspense payments
Other assets
Prepaid pension cost
Deferred tax assets
Customers’ liabilities under acceptances and guarantees
Allowance for possible loan losses
Total assets

936,102219
35,882140,000
28,984
4,257,457
1,790,446
49,768935,197
320,964
1,089,669
71,411
426,804
44,272
382,531
388,821
226,451
156,225
2,922
516
2,703
25,576
19,5995,976
3427
41,991
6,750
3,439
19,277
3,998
3,080
3,677
241
1,525
145
10,413
6(375)
5,356,358(Millions of Yen)
As of March 31, 2020
30,55418
30,53582,00026,915
4,373,776
1,728,003
54,671
945,309288,114
1,294,012
63,666377,91340,553
337,359
382,722
224,609
152,646
1,963
614
2,887
25,541
19,4636,077
11446
80,937
11,022
3,619
20,367
4,577
31,618
6,570
270
2,890
179
8,044
3
(391)
5,388,655

Asahi Mutual Life Insurance Company

３．Unaudited Non-consolidated Balance Sheets （Continued）
As of March 31, 2019
Liabilities:
Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders
Reinsurance payables
Bonds payable
Other liabilities:
Payables under securities borrowing transactions
Loans payable
Income taxes payable
Accounts payable
Accrued expenses
Deferred income
Deposits received
Guarantee deposits received
Derivative financial instruments
Cash collateral received for financial instruments
Lease obligations
Asset retirement obligations
Suspense receipts
Reserve for employees’ retirement benefits
Reserve for price fluctuation
Deferred tax liabilities for land revaluation
Acceptances and guarantees
Total liabilities
Net assets:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Surplus:Reserve for future losses
Other surplus:
Reserve for fund redemption
Equalized reserve for dividends to policyholders
Unappropriated surplus (loss)
Total foundation funds and others
Net unrealized gains (losses) on available-for-salesecurities, net of tax
Land revaluation differences
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

10(Millions of Yen)
As of March 31, 2020

4,605,062
27,5804,543,377
34,104397
88,295
192,123
88,61651,00060
19,796
7,785
222
482
17,221
2,314
1,320
2,922
246
133
33,64040,89017,116
64,977,531

4,529,448
29,3784,467,997
32,073563
88,295286,199
179,695
51,000
4,121
4,782
7,868
171
585
17,647
10,367
7,526
1,963
263
206
32,533
43,23016,8383
4,997,112

91,000166,000
281
67,073291
66,782
26,2009,258
31,324324,355

91,000166,000
281
81,819310
81,50935,3007,318
38,890339,100

99,032

97,625(44,561)
54,471
378,826
5,356,358(45,183)
52,442391,5435,388,655

Asahi Mutual Life Insurance Company

４．Unaudited Non-consolidated Statements of Income
Ordinary income:Premium and other income:Insurance premiums
Reinsurance revenue
Investment income:Interest, dividends and other income:Interest and dividends on securities
Interest on loans
Rent revenue from real estate
Other interest and dividends
Gains on sales of securities
Gains on redemption of securities
Foreign exchange gains
Reversal of allowance for possible loan losses
Other investment income
Investment gains on separate accounts
Other ordinary income:Fund receipt from deposit of claims paid
Reversal of reserve for employees’ retirement benefits
Reversal of reserve for outstanding claims
Reversal of policy reserves
Other ordinary income
Ordinary expenses:
Claims and other payments:
ClaimsAnnuities
Benefits
Surrender benefits
Other payments
Reinsurance premiums
Provision for policy reserves and other reserves:
Provision for reserve for outstanding claims
Provision for interest on policyholders’ dividend
reserves
Investment expenses:
Interest expenses
Losses on sales of securities
Losses on valuation of securities
Losses on redemption of securities
Losses on derivative financial instruments
Foreign exchange losses
Provision for allowance for possible loan losses
Depreciation of rental real estate and other assets
Other investment expenses
Investment losses on separate accounts
Operating expenses
Other ordinary expenses:
Claim deposit payments
Taxes
Depreciation
Other ordinary expenses
Ordinary profit
Extraordinary gains:
Gains on disposal of fixed assets
Other extraordinary gains
Extraordinary losses:
Losses on disposal of fixed assets
Impairment losses
Provision for reserve for price fluctuation
Losses on reduction entry of real estate
Other extraordinary losses
Surplus before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
Net surplus

11

Year ended March 31, 2019
638,402396,726
394,963
1,763
152,631
107,892
83,138
7,096
16,6371,019
34,648
2,258
14
7,476
340
89,044
11,145
1,725
788
73,541
1,842
613,765
418,245
121,536
128,425
71,70190,757
4,672
1,151
3
-

(Millions of Yen)
Year ended March 31, 2020
622,094
393,639391,600
2,038
139,776
108,705
85,1795,949
16,606970
23,85250
7,167
88,67810,355
1,106
75,3801,836
591,037
406,561
114,654
126,889
71,46988,017
3,744
1,786
1,801
1,798

3

3

56,2394,700
12,520628
22,923
5,361
10,104
105,845
33,431
12,675
7,775
11,462
1,517
24,636
3,433
3,433
10,995
7,098
1,235
2,180
241
239
17,074
3,055(2,202)853
16,22142,702
4,526
2,810
368
140
16,588
2,057
8
5,327
9,761
1,111
106,323
33,647
11,5108,503
11,8401,793
31,056
115
90
24
4,727
1,372
966
2,340
48
26,444
6,537
(505)
6,031
20,412Asahi Mutual Life Insurance Company

I. Presentation of Unaudited Non-consolidated Financial Statements
Basis of Presentation
The accompanying non-consolidated financial statements have been prepared from theaccounts maintained by Asahi Mutual Life Insurance Company (the “Company”) in accordancewith the provisions set forth in the Insurance Business Act of Japan and its related rules andregulations applicable to the mutual life insurance industry and in conformity with accounting
principles generally accepted in Japan, which are different in certain respects from accounting
principles generally accepted in countries and jurisdictions other than Japan.
In addition, the notes to the non-consolidated financial statements include information which
is not required under accounting principles generally accepted in Japan but is presented herein
as additional information.
Amounts of less than one million yen have been eliminated. As a result, total amounts in yen
shown herein do not necessarily agree with the sum of the individual amounts.
The Insurance Business Act shall prescribe the disclosure of a single fiscal year. The Company
provides the disclosure of comparative financial information corresponding to eachcomparative fiscal year in the presented financial statements for use by readers outside Japan.
In preparing the accompanying non-consolidated financial statements, certain reclassifications
have been made to the non-consolidated financial statements issued domestically in order topresent them in a format which is more familiar to readers outside Japan.

II. Notes to Unaudited Non-consolidated Balance Sheet
1.

Significant Accounting Policies(1) Valuation methods of securities
The valuation of securities, including deposits and monetary claims bought which areequivalent to securities is as follows:i)

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

ii)

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

12

Asahi Mutual Life Insurance Company

iii) Policy-reserve-matching bonds, which are in accordance with “Temporary Treatmentof Accounting and Auditing Concerning Policy-reserve-matching Bonds in Insurance
Industry” (Industry Audit Committee Report No. 21 issued by the Japanese Instituteof Certified Public Accountants (“JICPA”)), are stated at amortized cost (straight-line
method) determined by the moving average method.
iv) Investments in subsidiaries and affiliates are stated at cost.
v)

Available-for-sale securities with fair market value except for the following are stated
at fair market value based on the market prices at the end of the fiscal year.
Available-for-sale securities with fair market value, of which domestic stocks,
domestic stock exchange-traded funds, domestic listed real estate investment trusts,
foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied andforeign currency-denominated bonds for which hedge accounting is not applied, arestated at fair market value based on the average of the market prices during the final
month of the fiscal year. Costs of sales are determined by the moving average method.
Available-for-sale securities with extreme difficulty of measuring fair market value,of which public and corporate bonds including foreign bonds with the difference
between acquisition cost and face value considered as an adjustment of interest, arestated at amortized cost (straight-line method) determined by the moving averagemethod. The other securities are stated at cost determined by the moving averagemethod. Net unrealized gains or losses on these available-for-sale securities, net oftax, are recorded as a separate component of net assets.

(2) Policy-reserve-matching bonds
The Company classifies bonds held with the aim of matching the duration to outstanding
insurance liabilities within the sub-groups (categorized by insurance type, investment
policy and other factors) of individual life insurance and individual annuities aspolicy-reserve-matching bonds in accordance with “Temporary Treatment of Accounting
and Auditing Concerning Policy-reserve-matching Bonds in Insurance Industry” (Industry
Audit Committee Report No. 21 issued by the JICPA).
(3) Valuation methods of derivative financial instruments
Derivative financial instruments are stated at fair market value.
(4) Revaluation of land
The Company revalued the land for business purposes based on the Act on Revaluation ofLand (Act No. 34 promulgated on March 31, 1998). The difference between fair value andbook value resulting from the revaluation, net of related taxes, is recorded as land
revaluation differences as a separate component of net assets and the related tax isrecorded as deferred tax liabilities for revaluation.
■

Date of revaluation: March 31, 2001

13

Asahi Mutual Life Insurance Company

■

Method of revaluation as prescribed for in Article 3, Paragraph 3 of the said Act:The calculation is based on the publicly announced appraisal value with certain
adjustments set forth in Article 2, Item 1 of the Enforcement Ordinance of the Act on
Revaluation of Land (Government Ordinance No. 119 promulgated on March 31,
1998) or the appraisal value determined by the real-estate appraiser set forth in
Article 2, Item 5 of the said Ordinance with certain reasonable adjustments.

(5) Depreciation of tangible fixed assets
Depreciation of the Company’s tangible fixed assets is calculated by the following
methods.
■

Tangible fixed assets (excluding lease assets): Declining-balance method
However, buildings are depreciated using the straight-line method.

■

Lease assets related to finance lease transactions that do not transfer ownership:
Straight-line method over the lease term with no residual value(6) Foreign currency translation
Foreign currency-denominated assets and liabilities are translated into Japanese yen at
the effective exchange rate prevailing at the balance sheet date, except for foreignexchange-traded funds for which hedge accounting is not applied, foreign bondexchange-traded funds for which hedge accounting is not applied and foreign
currency-denominated bonds for which hedge accounting is not applied categorized asavailable-for-sale securities with fair market value. Such securities are translated into
Japanese yen at the average of the effective exchange rate during the final month of the
fiscal year.
(7) Allowance for possible loan losses
Allowance for possible loan losses is provided in accordance with the Company’s standardsof self-assessment and write-offs and reserves on credit quality:i)

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

ii)

For credit to borrowers who are not currently bankrupt but have a high risk ofbankruptcy (hereinafter “not currently bankrupt borrowers”), the Company provides
the amounts deemed as necessary considering the borrowers’ ability to pay, within
the amounts after deductions of the amount expected to be collected through thedisposal of collateral or the execution of guarantees.

14

Asahi Mutual Life Insurance Company

iii) For credit to borrowers other than the above, the Company provides the amounts
calculated by multiplying the book value by the actual ratio of bad debt losses on
defaults during a certain past period.
All credit is assessed by the relevant departments in accordance with the Company’s
standards of self-assessment on credit quality. The results of the assessment are reviewed
by the audit department, which is independent of business-related divisions. Subsequently,
allowance for possible loan losses is provided based on the results of these assessments.
For credit to legally bankrupt borrowers and substantially bankrupt borrowers, theamounts remaining after deductions of collateral value or the amounts collectible throughthe execution of guarantees are written-off directly from the book value as the estimateduncollectible amounts. The amount written-off as of March 31, 2020 was ¥34 million.
(8) Accounting for employees’ retirement benefits and method of amortizing retirement
benefit expenses
Reserve for employees’ retirement benefits and prepaid pension cost are presented for theemployees’ retirement benefits based on projected benefit obligation and pension plan
assets at the balance sheet date.
The Company uses the following methods of accounting in relation to retirement benefits.
■

The retirement benefit obligation is attributed to each period by the benefit formula
method.

■Actuarial differences are amortized under the straight-line method over a period ofseven years starting the following year.

■

Prior service cost is charged to income when incurred.

(9) Reserve for price fluctuation
Reserve for price fluctuation is calculated in accordance with Article 115 of the Insurance
Business Act.
(10) Accounting for hedging activities
Hedging activities are accounted for in accordance with the “Accounting Standards for
Financial Instruments” (Accounting Standards Board of Japan (“ASBJ”) Statement No.
10).
The Company mainly applies the following hedging activities:
The Company applies deferred hedge accounting and the exceptional accounting
treatment (“Tokurei-shori”) for interest rate swaps used to hedge the cash flow volatility ofcertain loans.

15

Asahi Mutual Life Insurance Company

The Company also applies fair value hedge accounting for hedging activities related toforeign exchange rate fluctuation exposures on certain bonds, investment trusts andothers denominated in foreign currencies.
The Company also applies designated hedge accounting (“Furiate-shori”) for currency
swaps used to hedge foreign exchange rate fluctuation exposures on the foreign
currency-denominated bonds issued by the Company.
The Company also applies designated hedge accounting (“Furiate-shori”) for the foreign
currency-denominated transactions other than the above.
The effectiveness of a hedge is mostly assessed by a ratio analysis, comparing thefluctuations in the fair value or cash flows of hedged items and hedging instruments.
(11) Accounting for consumption taxes
The Company accounts for consumption tax and local consumption tax by the
tax-exclusion method. The consumption taxes on certain assets, which are not deductible
from consumption taxes withheld and that are stipulated to be deferred under the
Corporation Tax Act of Japan, are deferred as prepaid expenses and amortized equally
over five years.
Consumption taxes other than deferred consumption taxes are recognized as an expense
when incurred.
(12) Policy reserves
Policy reserves are based on Article 116 of the Insurance Business Act and the premium
reserve at the end of fiscal year is calculated by the following method:
In regard to the policies subject to the standard policy reserves, the method as prescribedby the Commissioner of Financial Services Agency (Japanese Ministry of Finance Public
Notice No. 48, 1996) is applied.
In regard to the policies not subject to the standard policy reserves, the net level premium
method is applied.
(13) Software
Capitalized software for internal use owned by the Company is amortized using thestraight-line method over the estimated useful lives.

16

Asahi Mutual Life Insurance Company

2.

Accounting Standards and Guidances Issued but Not Yet Effective

The accounting standards and relevant guidances issued by the fiscal year-end but not yet
effective are as follows:■ “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued on
July 4, 2019)■ “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ
Guidance No. 31, issued on July 4, 2019)■ “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, revised on
July 4, 2019)(i)

Overview
In these accounting standards and guidances, the guidance on the methods for measuring
fair velues of financial instruments are set to enhance comparability between Japanese
accounting standards and international accounting standards.

(ii) Schedule date of adoption
The above revisions are scheduled to be applied from the beginning of the fiscal year
ending March 31, 2022.
(iii) Effects of application of the Accounting Standards and relevant guidances
The effects of the application are under assessment at the time of preparing these
non-consolidated financial statements.
3.

Financial Instruments

Asset management of the general accounts other than the separate accounts stipulated in
Article 118, Paragraph 1 of the Insurance Business Act is conducted based on the following
principles.
■

For accumulation whole life with variable interest rates, accumulation insurance withvariable interest rates and new single premium individual annuities which have aneffective date on or after April 2, 2012, the Company mainly invests in domestic bonds,
engaging in matching asset liability management, or Matching ALM, which aims atmatching the duration to outstanding insurance liabilities to avoid interest rate
fluctuation risks.

■

For individual life insurance and individual annuities other than above, the Company
holds yen-denominated fixed income investments, including bonds and loans, as the coreof its asset portfolio. The Company also holds domestic stocks, foreign securities and realestate assets to enhance its profitability.

Derivatives are mainly used to hedge market price fluctuation risk and exchange rate
fluctuation risk regarding securities and exchange rate fluctuation risk related to the foreign

17

Asahi Mutual Life Insurance Company

currency-denominated bonds issued by the Company. As the major financial instruments,
securities are exposed to market risk and credit risk, loans are exposed to credit risk andexchange rate fluctuation risk, and derivatives are exposed to market risk and credit risk.
In managing market risks, the following two methods are used. One is the quantitative risk
management of securities etc. using the Value at Risk (“VaR”) method and the other is the risk
management by stress test and sensitivity analysis which analyze the effect on the Company’s
whole portfolio, simulating scenarios of deteriorating market environments. This is for the
purpose of managing an appropriate asset allocation within the ranges of acceptable risks.
In managing credit risks, the Company quantifies the credit risks of entire portfolio throughVaR method and controls the amount of risks within an acceptable range. Furthermore, theCompany assigns in-house credit ratings to our borrowers in accordance with thecreditworthiness of each borrower. Strict credit research of each borrower before lending aswell as following up on any changes of creditworthiness of each borrower after lending are
implemented by Risk Management Department, which is independent of the departments
executing investments and lending. Maximum limits of credit are set up for each borrower inaccordance with its credit risks to avoid the concentration of credit risks on specificcorporations and specific corporation groups. Through all these measures, the Company
endeavors to develop high quality portfolio.

18

Asahi Mutual Life Insurance Company

The balance sheet amounts, fair values and the differences between those of major financial
assets and liabilities as of March 31, 2020 were as follows:
Millions of Yen
As of March 31, 2020
Balance Sheet
AmountCash and deposits¥
Call loans
Monetary claims bought
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Payables under securities borrowing transactions
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

30,55482,00026,91525,997918
4,353,742
20,372
308,469
2,050,330
1,974,569
377,91340,553
337,359
4,871,125
88,295
179,695
51,000318,990
21,251566
20,684

Fair Value¥

30,55482,00029,79628,878918
4,693,404
20,372
344,876
2,353,584
1,974,569
386,550
40,553345,997
5,222,305
81,164
179,695
52,776313,636
21,251566
20,684

Difference
¥

2,881
2,881
339,661
36,406303,2548,637
8,637
351,180(7,130)1,776(5,354)-*Assets and liabilities generated by derivative financial instruments are offset and presented net.
Net liabilities in total are presented in parentheses.

(1) Securities including deposits and monetary claims bought which are treated as securities
based on “Accounting Standards for Financial Instruments” (ASBJ Statement No. 10)
As for available-for-sale securities of which market value is readily available, domestic
stocks, domestic stock exchange-traded funds, domestic listed real estate investment
trusts, foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied and foreign
currency-denominated bonds for which hedge accounting is not applied are stated at the
average of the market value during the final month of the fiscal year. Available-for-salesecurities of which market value is readily available excluding the securities mentioned
above are stated at the market value at the balance sheet date.
Other securities of which market value is readily available are stated at market value atthe balance sheet date.
Unlisted stocks and others, including investments in subsidiaries and affiliates, of which

19

Asahi Mutual Life Insurance Company

market value is not readily available are not subject to fair value disclosure and are
therefore not included in the table above because it is regarded as extremely difficult todetermine their fair value.
The amount of the unlisted stocks and others, including investments in subsidiaries andaffiliates, reported in the non-consolidated balance sheet was ¥20,034 million as of March
31, 2020.
(2) Loans and loans payableAs credit exposure for policy loans without specific repayment periods is limited to theamount of the cash surrender value, the Company considers book value as fair value withthe assumption that fair value approximates book value in light of factors such as
projected repayment period and interest terms.
As for industrial and consumer loans and loans payable, the fair value of loans is
primarily stated at theoretical prices calculated by discounting the future cash flows to thepresent value. The fair value of loans to legally bankrupt borrowers, substantiallybankrupt borrowers and not currently bankrupt borrowers is stated at the amounts bydeducting estimated losses from the book value before direct write-offs.
(3) Bonds payable
The fair value of bonds payable is based on the market values, etc. as of March 31, 2020.
(4) Payables under securities borrowing transactions
The Company considers book value as fair value with the assumption that fair value
approximates book value.
(5) Derivative financial instruments
The fair values of stock options and currency options traded over the counter are based on
the quoted prices offered by counterparty financial institutions.
The fair values of foreign currency forward contracts are stated at theoretical prices basedon the TTM at the balance sheet date.
Regarding the derivative transactions for which designated hedge accounting(“Furiate-shori”) of currency swaps is applied, these fair values are included in bonds
payable since they are treated together with hedged bonds payable.
4.

Investments and Rental Properties

The Company holds investment and rental properties such as office buildings in Tokyo andother areas. The carrying amount and the fair value of investment and rental properties were¥249,504 million and ¥289,781 million as of March 31, 2020. The fair value is mainly based on
the value (including some adjustments using the reference prices) of real estate appraisal
report prepared by the external real-estate appraiser in accordance with real estate appraisal

20

Asahi Mutual Life Insurance Company

standards.
5.

Securities Lent under Lending Agreements

The amount of securities lent under lending agreements was ¥225,171 million as of March 31,
2020.
6.

Loans

The total amount of loans to bankrupt borrowers, delinquent loans, delinquent loans three ormore months past due and restructured loans, which were included in loans, was ¥735 million
as of March 31, 2020.
i)

Loans to bankrupt borrowers were ¥2 million as of March 31, 2020.

ii)

Delinquent loans were ¥589 million as of March 31, 2020.

iii) Delinquent loans three or more months past due were ¥122 million as of March 31, 2020.
iv) Restructured loans were ¥20 million as of March 31, 2020.
Loans to bankrupt borrowers represent loans, excluding the balances already written-off,which meet the conditions prescribed in Article 96, Paragraph 1, Items 3 and 4 of the
Enforcement Regulations of the Corporate Tax Act. Moreover, accruing interest on these loans
is not recorded as income after determining that principal of or interest on these loans isunlikely to be collected due to the significant delay in repayment of principal or interest
payments or for other reasons.
Accruing interest on delinquent loans is not recorded as income due to the same reasons as
described above, and delinquent loans exclude loans to bankrupt borrowers and loans for whichinterest payments have been suspended and rescheduled to assist and support the borrowers
in the restructuring of their businesses.
Delinquent loans three or more months past due are loans for which interest payments or
repayments of principal are delinquent for three months or more from the due dates under theterms of the related loan agreements, excluding those loans classified as loans to bankrupt
borrowers and delinquent loans.
Restructured loans are loans for which certain concessions favorable to borrowers, such as
interest reduction or exemptions, rescheduling of due dates of principal or interest payments,
waivers of claim or other terms, have been negotiated for the purpose of assisting andsupporting the borrowers in the restructuring of their businesses. This category excludes loansclassified as loans to bankrupt borrowers, delinquent loans and delinquent loans three or moremonths past due.
The direct write-offs related to loans decreased the amount of loans to bankrupt borrowers
described above by ¥3 million as of March 31, 2020.

21

Asahi Mutual Life Insurance Company

In addition, the direct write-offs related to loans decreased the amount of delinquent loans
described above by ¥31 million as of March 31, 2020.
7.

Accumulated Depreciation of Tangible Fixed Assets

Accumulated depreciation of tangible fixed assets totaled ¥283,126 million as of March 31,
2020.
8.

Separate Accounts

Total assets in separate accounts provided for in Article 118 of the Insurance Business Act were¥24,381 million as of March 31, 2020. The amounts of separate account liabilities were thesame as separate account assets.
9.

Receivables from/Payables to Subsidiaries

The total amounts of receivables from/payables to subsidiaries were ¥322 million and ¥1,712
million as of March 31, 2020.
10. Receivables from/Payables to Directors and Audit Board Members
There were no receivables from directors and audit board members as of March 31, 2020. The
total amount of payables to directors and audit board members was ¥15 million as of March 31,
2020.
11. Deferred Taxes(1) Deferred tax assets/liabilities were recognized as follows:

Deferred tax assets
Valuation allowance for deferred tax assets
Subtotal
Deferred tax liabilities
Net deferred tax assets (liabilities)

22

Millions of Yen
As ofMarch 31,2020¥
68,31922,48145,83837,794¥
8,044

Asahi Mutual Life Insurance Company

Major components of deferred tax assets/liabilities were as follows:

Millions of Yen
As ofMarch 31, 2020
Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Losses on valuation of securities
Reserve for employees’ retirement benefits
Impairment losses
Net unrealized losses on available-for-sale securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities¥

14,447
12,061
9,639
9,076
7,743
6,279

¥

36,552(2) The statutory tax rate was 27.9% for the fiscal year ended March 31, 2020. The main
factors causing the difference between the statutory tax rate and the actual effective tax
rate after considering deferred taxes were as follows:Year ended
March 31, 2020
(4.3)%(1.9)%

Interest on foundation funds
Reserve for dividends to policyholders

12. Reserve for Dividends to Policyholders

Balance at the beginning of the fiscal year
Transfer to reserve from surplus in the previous fiscal year
Dividends to policyholders paid out during the fiscal year
Increase in interest
Decrease in others
Balance at the end of the fiscal year

Millions of Yen
Year ended
March 31, 2020¥
34,104
2,173
4,208
131
128
¥
32,073

13. Stocks of Subsidiaries and Affiliates
The amount of stocks of subsidiaries and affiliates the Company held as of March 31, 2020 was¥6,694 million.
14. Pledged Assets
Assets pledged as collateral as of March 31, 2020 were securities in the amount of ¥7,030
million.

23

Asahi Mutual Life Insurance Company

15. Policy Reserves for the Reinsurance Contracts
Reserve for outstanding claims for the reinsurance contracts provided in accordance with
Article 73, Paragraph 3 of the Enforcement Regulation of the Insurance Business Act whichapplies mutatis mutandis to Article 71, Paragraph 1 of the Enforcement Regulation of the
Insurance Business Act (hereinafter “reserve for outstanding claims for ceded reinsurance”)
was ¥6 million as of March 31, 2020.
Policy reserves for the reinsurance contracts provided in accordance with Article 71, Paragraph
1 of the Enforcement Regulation of the Insurance Business Act (hereinafter “policy reserves forceded reinsurance”) were ¥366 million as of March 31, 2020.
16. Adjustment to Redemption of Foundation Funds and Appropriation of Net Surplus
The total amount of adjustment to redemption of foundation funds and appropriation of net
surplus defined in Article 30, Paragraph 2 of the Enforcement Regulation of the Insurance
Business Act was ¥97,907 million as of March 31, 2020.
17. Assets with Rights to Sell
The Company has the legal right to sell or collateralize securities borrowed under loan
agreements.
The market value of these assets that were not sold or pledged as collateral as of March 31,
2020 was ¥72,765 million. No assets were pledged as collateral as of March 31, 2020.
18. Commitment LineAs of March 31, 2020, there were unused commitment line agreements under which theCompany is the lender of ¥9,418 million.
19. Subordinated Bonds Payable
As of March 31, 2020, bonds payable are subordinated bonds payable, for which therepayments are subordinated to other obligations.
20. Subordinated Loans Payable
As of March 31, 2020, loans payable are subordinated loans payable, for which the repayments
are subordinated to other obligations.
21. Contributions to Policyholders Protection Corporation
The estimated future contributions to the Life Insurance Policyholders Protection Corporationof Japan under Article 259 of the Insurance Business Act as of March 31, 2020 were ¥8,609
million. These contributions are charged as operating expenses in the fiscal years in which
they are paid.

24

Asahi Mutual Life Insurance Company

22. Reserve for Employees’ Retirement Benefits(1) Summary of retirement benefit plans
As defined benefit plan, the Company has defined benefit corporate pension plans, which
are funded-type, and lump-sum retirement allowance plans which are non-funded typebut resulted in funded type due to setting of employee pension trust.
(2) Defined benefit plani)

Reconciliation of beginning and ending balance of retirement benefit obligations

Retirement benefit obligations at the beginning of the fiscal year
Service cost
Interest cost
Actuarial difference occurred during the fiscal year
Retirement benefit payments
Retirement benefit obligations at the end of the fiscal year

ii)

Millions of Yen
Year ended
March 31, 2020¥
43,586
1,779
435
(235)
(4,275)¥41,291

Reconciliation of beginning and ending balance of pension plan assets

Pension plan assets at the beginning of the fiscal year
Expected return on pension plan assets
Actuarial difference occurred during the fiscal year
Contributions by the employer
Retirement benefit payments
Pension plan assets at the end of the fiscal year

25

Millions of Yen
Year ended
March 31, 2020
¥
7,407
63
(877)
148
(233)
¥
6,507

Asahi Mutual Life Insurance Company

iii) Reconciliation of retirement benefit obligation and pension plan assets with reservefor employees’ retirement benefits and prepaid pension cost presented on the
non-consolidated balance sheet

Millions of Yen
As ofMarch 31, 2020¥
41,291(6,507)34,783(2,429)a. Funded plan retirement benefit obligationb. Pension plan assetsc. ( a + b )d. Unrecognized actuarial differences
e. Net amount of liabilities and assets presented on the
non-consolidated balance sheet
f. Reserve for employees’ retirement benefits
g. Prepaid pension cost
h. Net amount of liabilities and assets presented on the
non-consolidated balance sheet

32,35332,533(179)¥

32,353iv) Breakdown of retirement benefit expenses

Service cost
Interest cost
Expected return on pension plan assets
Amortization of actuarial differences
Retirement benefit expenses related to defined benefit planv)

Millions of Yen
Year ended
March 31, 2020
¥
1,779
435
(63)
896
¥
3,049

Breakdown of main pension plan assets
The breakdown of main asset categories as a percentage of pension plan assets was asfollows:
As ofMarch 31,2020
38%
9%
53%
100%

Stocks
Bonds
OthersTotalvi) Method for determining the expected long-term rate of return
To determine the expected long-term rate of return on pension plan assets, theCompany takes into account the present and future allocation of pension plan assets,
and the present and expected future long-term rate of return on the diverse range ofassets that makes up the pension assets.

26

Asahi Mutual Life Insurance Company

vii) Underlying actuarial assumptions
The main underlying actuarial assumptions were as follows:

Discount rate
Expected long-term rate of return on pension plan assets
Defined benefit corporate pension plans

III.

Notes to Unaudited Non-consolidated Statement of Income

1.

Transactions with Subsidiaries and Affiliates

As of
March 31, 2020
1.0%
0.9%
1.7%

The total amounts of revenues and expenditures in connection with subsidiaries and affiliates
were ¥381 million and ¥9,483 million for the fiscal year ended March 31, 2020.
2.

Investment Income and Expenses

The major components of gains on sales of securities were as follows:

Domestic bonds
Domestic stocks and other securities
Foreign securities

Millions of Yen
Year ended
March 31, 2020¥
21,832
2,018
1

The major components of losses on sales of securities were as follows:

Domestic bonds
Domestic stocks and other securities

Millions of Yen
Year ended
March 31, 2020
¥
690
2,120

The major components of losses on valuation of securities were as follows:

Domestic stocks and other securities

Millions of Yen
Year ended
March 31, 2020¥
368

Losses on derivative financial instruments included net valuation losses of ¥1,456 million for
the fiscal year ended March 31, 2020.

27

Asahi Mutual Life Insurance Company

3.

Policy Reserves for the Reinsurance Contracts

Provision for reserve for outstanding claims for ceded reinsurance, which was deducted in
calculating provision for reserve for outstanding claims for the fiscal year ended March 31,
2020 was ¥2 million.
Provision for policy reserves for ceded reinsurance, which was added in calculating reversal ofpolicy reserves for the fiscal year ended March 31, 2020 was ¥96 million.

28

Asahi Mutual Life Insurance Company

５．Breakdown of Ordinary Profit (Fundamental Profit)(Millions of Yen)
Year ended
March 31, 2019Year ended
March 31, 2020

24,25829,641

36,90723,852

Gains on money held in trust--

Gains on trading securities--

Gains on sales of securities

34,64823,852

-

-

2,258

-

-

-

36,073

21,826

Losses on money held in trust--

Losses on trading securities--

Losses on sales of securities

12,520

2,810

628

368

22,923

16,588Foreign exchange losses

-

2,057

Other capital losses

-

-

Ｂ

833

2,025

Ａ＋Ｂ

25,092

31,667

44-

Reinsurance revenue--

Reversal of contingency reserve
Reversal of specific allowance for possible loan
lossesOthers

-

-

44

-

-

-

Other one-time losses

500

610

Reinsurance premiums

-

-

500

600

-

10

-

-

Write-offs of loans00Others

-

-

Ｃ

(455)

(610)

Ａ＋Ｂ＋Ｃ

24,636

31,056

Fundamental profit

Ａ

Capital gains

Gains on derivative financial instruments
Foreign exchange gains
Other capital gains
Capital losses

Losses on valuation of securities
Losses on derivative financial instruments

Net capital gains (losses)
Fundamental profit plus net capital gains(losses)
Other one-time gains

Provision for contingency reserve
Provision for specific allowance for possible loan
lossesProvision for allowance for specified overseas loans

Net other one-time gains (losses)
Ordinary profit

29

Asahi Mutual Life Insurance Company

６．Unaudited Non-consolidated Statements of Changes in Net Assets
Year ended March 31, 2019

(Millions of Yen)
Foundation funds and others
Surplus

Beginning balance

Foundation
funds

Reserve forredemption offoundation
funds

Reserve forrevaluation

126,000

131,000

281

Other surplus
Reserve for
future losses

Reserve forfund
redemption

266

48,600Equalized
Unappropriatedreserve forsurplusdividends to(loss)
policyholders

9,678

Total
surplusTotal
foundation
funds andothers37,356

95,901

353,183(1,963)(1,963)(1,963)

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses

25

Additions to reserve for redemption offoundation funds

35,000(25)(35,000)(35,000)

Payment of interest on foundation
funds(6,266)(6,266)(6,266)

Net surplus

16,221

16,221

16,221

Redemption of foundation funds(35,000)(35,000)

Additions to reserve for fundredemption

12,600

Reversal of equalized reserve fordividends to policyholders(12,600)(420)

Reversal of land revaluation differences

420(1,819)(1,819)(1,819)Net changes, excluding foundation
funds and others
Net changes in the fiscal year

(35,000)

35,000-25(22,400)(420)(6,032)(28,827)(28,827)

Ending balance

91,000166,000

281

291

26,2009,258

31,324

67,073324,355

Valuation and translation adjustments
Net unrealized
gains (losses)
on availablefor-salesecurities,
net of tax
Beginning balance

81,292Landrevaluationdifferences(46,380)

Totalvaluation andtranslation
adjustments

34,912Total
net assets

388,095

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders(1,963)

Additions to reserve for future losses
Additions to reserve for redemption offoundation funds
Payment of interest on foundation
funds(6,266)

Net surplus

16,221

Redemption of foundation funds(35,000)

Additions to reserve for fundredemption
Reversal of equalized reserve fordividends to policyholders
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others(1,819)17,7391,819

19,55919,559Net changes in the fiscal year

17,7391,819

19,559(9,268)Ending balance

99,032(44,561)

54,471

378,826

30

Asahi Mutual Life Insurance Company

Year ended March 31, 2020

(Millions of Yen)
Foundation funds and others
Surplus

Beginning balance

Foundation
funds

Reserve forredemption offoundation
funds

Reserve forrevaluation

91,000166,000

281

Other surplus
Reserve for
future losses

Reserve forfund
redemption

291

26,200Equalized
Unappropriatedreserve forsurplusdividends to(loss)
policyholders

9,258

Total
surplusTotal
foundation
funds andothers31,324

67,073324,355(2,173)(2,173)(2,173)

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for future losses

19

(19)

Payment of interest on foundation
funds(4,116)(4,116)(4,116)

Net surplus

20,412

20,412

20,412

622

622

622

Additions to reserve for fundredemption

9,100

Reversal of equalized reserve fordividends to policyholders(9,100)(1,939)

Reversal of land revaluation differences

1,939

Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance

91,000--166,000

281

19

9,100

(1,939)7,566

14,745

14,745310

35,3007,318

38,89081,819339,100

Valuation and translation adjustments
Net unrealized
gains (losses)
on availablefor-salesecurities,
net of tax
Beginning balance

99,032Landrevaluationdifferences(44,561)

Total
valuation andtranslation
adjustments

54,471Total
net assets

378,826

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders(2,173)

Additions to reserve for future losses
Payment of interest on foundation
funds(4,116)

Net surplus

20,412

Additions to reserve for fundredemption
Reversal of equalized reserve fordividends to policyholders
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others

622(1,406)(622)(2,029)(2,029)Net changes in the fiscal year

(1,406)(622)(2,029)12,716

Ending balance

97,625(45,183)

52,442391,543

31

Asahi Mutual Life Insurance Company

７．Unaudited Non-consolidated Statements of Proposed Appropriation of Surplus(Millions of Yen)
Year ended
March 31, 2019Year ended
March 31, 2020

Unappropriated surplus (loss)

31,32438,890

Reversal of voluntary surplus reserves

1,939

227

1,939

227

33,264

39,117

15,40814,993

Reserve for dividends to policyholders

2,173

1,794

Net surplus (loss)

13,235

13,19919

18

Interest on foundation funds

4,116

4,081

Voluntary surplus reserves

9,100

9,100

9,100

9,100

17,85524,123

Reversal of equalized reserve for dividends topolicyholders
Total
Appropriation of surplus (loss)

Reserve for future losses

Reserve for fund redemption
Surplus (loss) carried forward

32

Asahi Mutual Life Insurance Company

８．Disclosed Claims Based on Categories of Obligors(Millions of Yen, ％)As of March 31, 2019

As of March 31, 2020

Claims against bankrupt and quasi-bankrupt
obligors

437

452

Claims with collection risk

197

154

Claims for special attention

141

147

Subtotal776

753（Percentage of total）(0.13)(0.12)

Claims against normal obligors

584,761

603,722

Total

585,538

604,476

Notes:
1.Claims against bankrupt and quasi-bankrupt obligors are claims to obligors who are subject tobankruptcy, corporate reorganization or rehabilitation or other similar proceedings and other obligors
in serious financial difficulities.
2.Claims with collection risk are claims to obligors (other than bankrupt and quasi-bankrupt obligors) withdeteriorated financial condition and results of operations from which it is unlikely that the principal andinterest on the claims will be recovered.
3.Claims for special attention are claims on which principal and/or interest are past due for three months ormore and claims with a concessionary interest rate, as well as claims with renegotiated conditions in favor of
the borrower, including renegotiated schedule and/or waivers, in each case, other than the claims describedin note 1. or 2. above.
4.Claims against normal obligors are all other claims.

(Reference)
Amount of loans based on self-assessment categories(Millions of Yen)
As of March 31, 2020

As of March 31, 2019
Write-offs, provision for allowance
BeforeWrite-offs, provision for allowance

After

BeforeAfter

Category II

5,843

5,843

342

342

Category III

197

112

164

60

Category IV

79

-

70

-

33

Asahi Mutual Life Insurance Company

９．Risk-monitored Loans(Millions of Yen, ％)As of March 31, 2019

Loans to bankrupt borrowers

As of March 31, 2020

02

Delinquent loans

619

589

Delinquent loans three or more months past due

110

122

Restructured loans

27

20

Total

757

735

（Percentage of total loans）(0.18)(0.19)

Notes:
1.For credit to legally bankrupt borrowers and substantially bankrupt borrowers, the amounts remaining after
the deductions of amount expected to be collected through the disposal of collateral or the execution ofguarantees are written-off directly from the book value as the estimated uncollectible amounts.
The amounts written-off related to loans to bankrupt borrowers were \3 million as of March 31, 2019 and\3 million as of March 31, 2020. The amounts written-off related to delinquent loans were \43 million
as of March 31, 2019 and \31 million as of March 31, 2020.
2.Loans to bankrupt borrowers represent non-accrual loans to borrowers which are subject to bankruptcy,
corporate reorganization or rehabilitation or other similar, including but not limited to foreign, proceedings.
Accruing interest on these loans is not recorded as income after determining that principal of or interest on
these loans is unlikely to be collected due to the significant delay in repayment of principal or interest
repayments or for other reasons.
3.Delinquent loans are loans whose accruing interest is not recorded as income and exclude loans tobankrupt borrowers and loans for which interest payments have been suspended and rescheduled to assist
and support the borrowers in the restructuring of their business.
4.Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those loans classified as loans to bankrupt borrowers or delinquent loans.
5.Restructured loans are loans for which certain concessions favorable to borrowers, such as interest reduction
or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim or other terms,
have been negotiated for the purpose of assisting and supporting the borrowers in the restructuring of theirbusinesses. This category excludes loans classified as loans to bankrupt borrowers, delinquent loans anddelinquent loans three or more months past due.

34

Asahi Mutual Life Insurance Company

10．Solvency Margin Ratio(Millions of Yen)

As of March 31, 2019

Total solvency margin（Ａ）

As of March 31, 2020

816,808

860,443

Foundation funds and surplus

318,065

333,225

Reserve for price fluctuation

40,89043,230Contingency reserve

51,182

51,782

General allowance for possible loan losses

48

46(Net unrealized gains on available-for-sale securities (before tax effect) anddeferred hedge gains (before tax effect)) × 90% (in case of losses： × 100%)

115,805

116,876

Net unrealized gains on land × 85%(in case of losses： × 100%)

10,43427,786

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

132,013137,190

Qualifying subordinated debt

138,495

138,095

Excess amount of policy reserves based on full-time Zillmer method and qualifying subordinateddebt excluded from the calculation of solvency margin--

Deduction

-

-

9,873

12,211

189,712

182,513

OthersTotal amount of risk

( R1  R8 ) 2  ( R2  R3  R7 ) 2  R4

（Ｂ）

Insurance risk

R1

13,77913,155

Third sector insurance risk

R8

9,622

9,974

Risk of assumed yield

R2

75,362

72,246

Minimum guarantee risk

R7

1,069

1,055

Investment risk

R3

107,649

103,703

Operational risk

R4

4,149

4,002

861.1%

942.8%

Solvency margin ratio(Ａ) / {(1/2)×(Ｂ)} × 100

Notes:
1. The figures above are calculated based on Articles 86 and 87 of the Ordinance for Enforcement of the Insurance Business Act and the Public Notice
No. 50 of the Ministry of Finance of 1996.
2. "Excess amount of policy reserves based on full-time Zillmer method", "Qualifying subordinated debt" and "Excess amount of policy reserves basedon full-time Zillmer method and qualifying subordinated debt excluded from the calculation of solvency margin" are calculated based on the Public
Notice No.25 of the Financial Service Agency of 2011.
3. "Minimum guarantee risk" is calculated by standard method.

35

Asahi Mutual Life Insurance Company

11．Status of Separate Account(1) Separate Account Assets by Products(Millions of Yen)

As of March 31, 2019

As of March 31,2020

AmountAmountIndividual variable insurance

27,56024,381

Individual variable annuities--

Group annuity products--

27,56024,381

Total（２）Individual Variable Insurance (Separate Account)(ⅰ)Sum Insured of Policies in Force
As of March 31,2019
Number of policies(Thousands)

Individual variable insurance(fixed term)
Individual variable insurance(whole life)
Total

As of March 31,2020

AmountNumber of policies(Thousands)(Millions of Yen)

Amount(Millions of Yen)

-

-

-

-

13

95,691

13

92,623

13

95,691

13

92,62336

Asahi Mutual Life Insurance Company

(ⅱ)Breakdown of Separate Account Assets for Individual Variable Insurance(Millions of Yen)
As of March 31,2019
AmountAs of March 31,2020

Percentage

AmountPercentage

Cash, deposits, call loans

1,958

7.1

2,619

10.7

Securities

25,41092.2

20,372

83.6

Domestic bonds

5,326

19.3

5,780

23.7

Domestic stocks

9,265

33.6

5,641

23.1

Foreign securities

10,819

39.3

8,950

36.7

Foreign bonds

4,032

14.6

3,415

14.0

Foreign stocks and other foreign securities

6,786

24.6

5,534

22.7

-

-

-

-

Loans

-

-

-

-

Others

190

0.7

1,389

5.7

Other securities

Allowance for possible loan losses
Total

-

-

-

-

27,560100.0

24,381

100.0(ⅲ)Investment Income and Expenses of Separate Account for Individual Variable Insurance(Millions of Yen)
Year ended
Year ended
March 31, 2019 March 31, 2020
AmountInterest, dividends and other income

Amount

624

567

2,015

2,290

-

-

2,371

1,889

Foreign exchange gains

21

50

Gains on derivative financial instruments--

Other investment income

0

1

2,091

2,441

8

13

2,566

3,407

Foreign exchange losses

27

48

Losses on derivative financial instruments

0-

Other investment expenses

0

0

340

(1,111)

Gains on sales of securities
Gains on redemptions of securities
Gains on valuation of securities

Losses on sales of securities
Losses on redemptions of securities
Losses on valuation of securities

Net Investment Income（３）Individual Variable Annuities(Separate Account)
The Company does not have individual variable annuity contracts in force.

37

Asahi Mutual Life Insurance Company

12．Status of the Company, Subsidiaries and Affiliates(1) Selected Financial Data
(Millions of Yen)

Year ended
March 31, 2019Year ended
March 31, 2020

Ordinary income

642,637

626,362

Ordinary profit

24,532

31,040Net surplus attributable to the Parent Company

16,01820,294Comprehensive income

31,432

19,101(Millions of Yen)

As of March 31, 2019
Total assets
Solvency margin ratio

38

As of March 31, 2020

5,357,677

5,390,941

865.7%

948.7%

Asahi Mutual Life Insurance Company

（2）Unaudited Consolidated Balance Sheets

Assets:Cash and deposits
Call loans
Monetary claims bought
Securities
Loans
Tangible fixed assets:
Land
Buildings
Lease assets
Construction in progress
Other tangible fixed assets
Intangible fixed assets:
Software
Other intangible fixed assets
Agency accounts receivable
Reinsurance receivables
Other assets
Net defined benefit assets
Deferred tax assets
Customers’ liabilities under acceptances and guarantees

Allowance for possible loan losses
Total assets
Liabilities:
Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders
Reinsurance payables
Bonds payable
Other liabilities
Net defined benefit liabilities
Reserve for price fluctuation
Deferred tax liabilities for land revaluation
Acceptances and guarantees
Total liabilities
Net assets:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Consolidated surplus
Total foundation funds and others
Net unrealized gains (losses) on available-for-salesecurities, net of tax
Land revaluation differences
Accumulated remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

39

As of March 31, 2019

(Millions of Yen)
As of March 31, 2020

40,630140,000
28,984
4,252,984
426,804
388,875
226,451
156,234
2,922
516
2,749
24,836
18,9335,903
3427
42,947292
11,262
6(378)
5,357,677

35,22782,00026,915
4,369,302
377,913382,776
224,609
152,653
1,963
614
2,933
24,731
18,7355,995
11446
82,963
178
8,863
3
(391)
5,390,941

4,605,062
27,5804,543,377
34,104397
88,295
192,779
36,48040,89017,116
6
4,981,027

4,529,448
29,3784,467,997
32,073563
88,295
288,156
34,98543,23016,83835,001,521

91,000166,000
281
66,801
324,083

91,000166,000
281
81,429338,71199,034

97,625(44,561)(1,990)52,482
83
376,650
5,357,677(45,183)(1,814)50,627
81
389,420
5,390,941

Asahi Mutual Life Insurance Company

（3）Unaudited Consolidated Statements of Income and Statements of Comprehensive Income（Unaudited Consolidated Statements of Income）
Year ended March 31, 2019
Ordinary income:(Millions of Yen)
Year ended March 31, 2020

642,637

626,362

Premium and other income

396,726

393,639

Investment income:

152,045

139,494

Interest, dividends and other income

107,335

108,447

Gains on sales of securities

34,64823,854

-

50

2,257

-

11

-

7,452

7,143

Gains on redemption of securities
Foreign exchange gains
Reversal of allowance for possible loan losses
Other investment income
Investment gains on separate accounts

340-

93,86593,228618,104

595,321418,245406,561

Claims121,536

114,654

Annuities

128,425

126,889

Benefits

71,701

71,469

Surrender benefits

90,75788,017

Other payments

5,823

5,530

Provision for policy reserves and other reserves:

3

1,801

Provision for reserve for outstanding claims

-

1,798

Provision for interest on policyholders’ dividend reserves

33

Investment expenses:

56,23942,703

Interest expenses

4,700

4,526

Losses on sales of securities

12,5212,810

Losses on valuation of securities

628

368

Losses on redemption of securities-

140

22,923

16,588-

2,058

Other ordinary income
Ordinary expenses:
Claims and other payments:

Losses on derivative financial instruments
Foreign exchange losses
Provision for allowance for possible loan losses-

8

Depreciation of rental real estate and other assets

5,361

5,327

Other investment expenses

10,104

9,761

-

1,111

Operating expenses

Investment losses on separate accounts

110,327

110,795

Other ordinary expenses

33,28833,458

Ordinary profit

24,532

31,040Extraordinary gains:

3,433

115

3,433

90

-

24

Gains on disposal of fixed assets
Other extraordinary gains
Extraordinary losses:

10,995

4,728

Losses on disposal of fixed assets

7,098

1,373

Impairment losses

1,235

966

Provision for reserve for price fluctuation

2,180

2,340

Losses on reduction entry of real estate

241-

Other extraordinary losses

239

48

Surplus before income taxes

16,97026,427

Income taxes-current

3,160

6,635

Income taxes-deferred(2,250)(542)

Total income taxes

910

6,093

16,06020,333

Net surplus
Net surplus attributable to non-controlling interests
Net surplus attributable to the Parent Company

40

41

38

16,01820,294

Asahi Mutual Life Insurance Company

（Unaudited Consolidated Statements of Comprehensive Income）(Millions of Yen)
Year ended March 31, 2019Year ended March 31, 2020

Net surplus

16,06020,333

Other comprehensive income:

15,372(1,232)Net unrealized gains (losses) on available-for-sale securities, net of tax

17,740(1,408)Remeasurements of defined benefit plans(2,367)

176

31,432

19,101

31,391

19,062

41

38

Comprehensive income:Comprehensive income attributable to the Parent Company
Comprehensive income attributable to non-controlling interests

41

Asahi Mutual Life Insurance Company

（4）Unaudited Consolidated Statements of Cash Flows(Millions of Yen)
Year ended March 31, 2019 Year ended March 31, 2020
I. Cash flows from operating activities
Surplus before income taxes
Depreciation of rental real estate and other assets
Depreciation
Impairment losses
Increase (decrease) in reserve for outstanding claims
Increase (decrease) in policy reserves
Provision for interest on policyholders’ dividend reserves
Increase (decrease) in allowance for possible loan losses
Increase (decrease) in net defined benefit liabilities
Increase (decrease) in reserve for price fluctuation
Interest, dividends and other income(Gains) losses on securities(Gains) losses on derivative financial instruments
Interest expenses
Foreign exchange (gains) losses, net(Gains) losses on tangible fixed assets(Increase) decrease in reinsurance receivables(Increase) decrease in other assets except from investing and financing activities
Increase (decrease) in reinsurance payables
Increase (decrease) in other liabilities except from investing and financing activities
Others, net
SubtotalInterest, dividends and other income received
Interest paid
Dividends to policyholders paid
Income taxes (paid) refunded
Net cash provided by (used in) operating activities
II. Cash flows from investing activities
Purchases of monetary claims bought
Proceeds from sales and redemptions of monetary claims bought
Purchases of securities
Proceeds from sales and redemptions of securities
Disbursements for loans
Proceeds from collections of loans
Proceeds from derivative financial instruments
Increase (decrease) in payables under securities borrowing transactions①Total of investing activities[I+①]
Purchases of tangible fixed assets
Proceeds from sales of tangible fixed assets
Others, net
Net cash provided by (used in) investing activities
III. Cash flows from financing activities
Redemption of debt borrowing
Proceeds from issuance of bonds
Redemption of foundation funds
Payment of interest on foundation funds
Dividends paid to non-controlling interests
Others, net
Net cash provided by (used in) financing activities
IV.Net increase (decrease) in cash and cash equivalents
V.Cash and cash equivalents at the beginning of the year
VI. Cash and cash equivalents at the end of the year

42

16,9705,361
11,263
1,235(788)(73,541)3(11)(1,725)2,180(107,335)(21,839)
22,9234,700(2,257)(957)
384(2,271)
85
(910)
1,917
(144,612)
110,216(5,309)(4,821)(7,830)(52,357)

26,427
5,327
11,586966
1,798(75,380)38(1,106)2,340(108,447)(19,473)
16,588
4,526
2,058
1,053
(19)
(3,849)
165
907
5,549
(128,967)
114,322(4,531)(4,208)(1,387)(24,771)(1,170)2,354(628,864)
624,046(40,838)
98,573(23,572)
43,64974,177
21,820(7,404)
9,597(3,224)
73,145(281)
2,373(553,820)
371,280(41,128)
87,50921,76091,078(21,228)(46,000)(7,464)
1,814(6,575)(33,453)(46,000)
47,946(35,000)(6,134)(39)(1,074)(40,301)(19,512)200,143
180,630(4,116)(41)(1,019)(5,177)(63,402)180,630
117,227

Asahi Mutual Life Insurance Company

（5）Unaudited Consolidated Statements of Changes in Net Assets
Year ended March 31, 2019

(Millions of Yen)
Foundation funds and others

Beginning balance

Foundation
funds

Reserve forredemption offoundation
funds

126,000

131,000

Reserve forrevaluation

Consolidated
surplus281

Total
foundation
funds andothers

95,832353,114(1,963)(1,963)

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for redemption offoundation funds
Payment of interest on foundation
funds
Net surplus attributable to the Parent
Company
Redemption of foundation funds

35,000(35,000)(6,266)(6,266)

16,01816,018(35,000)(35,000)

Reversal of land revaluation differences(1,819)(1,819)Net changes, excluding foundation
funds and others
Net changes in the fiscal year

(35,000)

35,000-(29,030)(29,030)

Ending balance

91,000166,000

281

66,801

324,083

Accumulated other comprehensive income
Net unrealized
gains (losses)
on availablefor-salesecurities,
net of tax
Beginning balance

81,293Landrevaluationdifferences(46,380)

Total
Accumulated
accumulated
remeasurements
otherof definedcomprehensive
benefit plansincome377

35,290Noncontrollinginterests

Total
net assets

81

388,486

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Additions to reserve for redemption offoundation funds
Payment of interest on foundation
funds
Net surplus attributable to the Parent
Company(1,963)(6,266)
16,018

Redemption of foundation funds(35,000)

Reversal of land revaluation differences(1,819)Net changes, excluding foundation
funds and others

17,7401,819(2,367)

17,192

2

17,194

Net changes in the fiscal year

17,7401,819(2,367)

17,192

2(11,835)

Ending balance

99,034(44,561)(1,990)52,482

83

376,650

43

Asahi Mutual Life Insurance Company

Year ended March 31, 2020

(Millions of Yen)
Foundation funds and others

Beginning balance

Foundation
funds

Reserve forredemption offoundation
funds

91,000166,000

Reserve forrevaluation

Consolidated
surplus281

Total
foundation
funds andothers

66,801

324,083(2,173)(2,173)(4,116)(4,116)

20,294

20,294622

622

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Payment of interest on foundation
funds
Net surplus attributable to the Parent
Company
Reversal of land revaluation differences
Net changes, excluding foundation
funds and others
Net changes in the fiscal year
Ending balance

-

-

-

14,627

14,62791,000166,000

281

81,429338,711

Accumulated other comprehensive income
Net unrealized
gains (losses)
on availablefor-salesecurities,
net of tax
Beginning balance

99,034Land
revaluationdifferences(44,561)

Total
Accumulated
accumulated
remeasurements
otherof definedcomprehensive
benefit plansincome(1,990)52,482

Noncontrollinginterests

83

Total
net assets

376,650

Changes in the fiscal year:
Additions to reserve for dividends topolicyholders
Payment of interest on foundation
funds
Net surplus attributable to the Parent
Company(2,173)(4,116)
20,294

Reversal of land revaluation differences
Net changes, excluding foundation
funds and others

622(1,408)

(622)

176

(1,854)(2)(1,857)

Net changes in the fiscal year

(1,408)

(622)

176

(1,854)(2)

12,770Ending balance

97,625(45,183)(1,814)50,627

81

389,420

44

Asahi Mutual Life Insurance Company

I.

Presentation of Unaudited Consolidated Financial Statements

1.

Basis of Presentation

The accompanying consolidated financial statements have been prepared from the accounts
maintained by Asahi Mutual Life Insurance Company (the “Company”) and its consolidated
subsidiaries in accordance with the provisions set forth in the Insurance Business Act of Japanand its related rules and regulations applicable to the mutual life insurance industry and in
conformity with accounting principles generally accepted in Japan, which are different incertain respects from accounting principles generally accepted in countries and jurisdictions
other than Japan.
In addition, the notes to the consolidated financial statements include information which is not
required under accounting principles generally accepted in Japan but is presented herein as
additional information.
Amounts of less than one million yen have been eliminated. As a result, total amounts in yen
shown herein do not necessarily agree with the sum of the individual amounts.
The Insurance Business Act shall prescribe the disclosure of a single fiscal year. The Company
provides the disclosure of comparative financial information corresponding to eachcomparative fiscal year in the presented financial statements for use by readers outside Japan.
In preparing the accompanying consolidated financial statements, certain reclassifications
have been made to the consolidated financial statements issued domestically in order topresent them in a format which is more familiar to readers outside Japan.
2.

Principles of Consolidation(1) Scope of consolidation
The consolidated subsidiaries as of March 31, 2020 are listed below:
Info Techno Asahi Co., Ltd.
Asahi Life Asset Management Co., Ltd.
Asahi Natixis Investment Managers Co., Ltd.
(former Asahi Nvest Investment Advisory Co., Ltd.)The major unconsolidated subsidiary is Asahi Real Estate Management Co., Ltd.
Each non-consolidated subsidiary is small in scale in terms of total assets, amount of sales,
net income and surplus for the fiscal year ended March 31, 2020. As such non-consolidated
subsidiaries are not considered to materially affect any reasonable determination as to thefinancial position and result of operation of the Company’s group, these companies are
excluded from the consolidation.

45

Asahi Mutual Life Insurance Company

(2) Application of equity method
Unconsolidated subsidiaries (such as Asahi Real Estate Management Co., Ltd, etc.) are
immaterial in terms of their impact on consolidated net income and surplus, and also
immaterial as a whole, therefore, the equity method is not applied.
(3) Fiscal year-end of consolidated subsidiaries
The fiscal year-end of the consolidated subsidiaries is March 31.
(4) Amortization of goodwill
Goodwill is fully expensed as incurred.

II. Notes to Unaudited Consolidated Balance Sheet
1.

Significant Accounting Policies(1) Valuation methods of securities
The valuation of securities, including deposits and monetary claims bought which areequivalent to securities is as follows:i)

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

ii)

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

iii) Policy-reserve-matching bonds, which are in accordance with “Temporary Treatmentof Accounting and Auditing Concerning Policy-reserve-matching Bonds in Insurance
Industry” (Industry Audit Committee Report No. 21 issued by the Japanese Instituteof Certified Public Accountants (“JICPA”)), are stated at amortized cost (straight-line
method) determined by the moving average method.
iv) Investments in unconsolidated subsidiaries and affiliates not accounted for under theequity method are stated at cost.
v)

Available-for-sale securities with fair market value except for the following are stated
at fair market value based on the market prices at the end of the fiscal year.
Available-for-sale securities with fair market value, of which domestic stocks,
domestic stock exchange-traded funds, domestic listed real estate investment trusts,
foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied andforeign currency-denominated bonds for which hedge accounting is not applied, arestated at fair market value based on the average of the market prices during the final
month of the fiscal year. Costs of sales are determined by the moving average method.
Available-for-sale securities with extreme difficulty of measuring fair market value,46

Asahi Mutual Life Insurance Company

of which public and corporate bonds including foreign bonds with the difference
between acquisition cost and face value considered as an adjustment of interest, arestated at amortized cost (straight-line method) determined by the moving averagemethod. The other securities are stated at cost determined by the moving averagemethod. Net unrealized gains or losses on these available-for-sale securities, net oftax, are recorded as a separate component of net assets.
(2) Policy-reserve-matching bonds
The Company classifies bonds held with the aim of matching the duration to outstanding
insurance liabilities within the sub-groups (categorized by insurance type, investment
policy and other factors) of individual life insurance and individual annuities aspolicy-reserve-matching bonds in accordance with “Temporary Treatment of Accounting
and Auditing Concerning Policy-reserve-matching Bonds in Insurance Industry” (Industry
Audit Committee Report No. 21 issued by the JICPA).
(3) Valuation methods of derivative financial instruments
Derivative financial instruments are stated at fair market value.
(4) Revaluation of land
The Company revalued the land for business purposes based on the Act on Revaluation ofLand (Act No. 34 promulgated on March 31, 1998). The difference between fair value andbook value resulting from the revaluation, net of related taxes, is recorded as land
revaluation differences as a separate component of net assets and the related tax isrecorded as deferred tax liabilities for revaluation.
■

Date of revaluation: March 31, 2001■

Method of revaluation as prescribed for in Article 3, Paragraph 3 of the said Act:The calculation is based on the publicly announced appraisal value with certain
adjustments set forth in Article 2, Item 1 of the Enforcement Ordinance of the Act on
Revaluation of Land (Government Ordinance No. 119 promulgated on March 31,
1998) or the appraisal value determined by the real-estate appraiser set forth in
Article 2, Item 5 of the said Ordinance with certain reasonable adjustments.

(5) Depreciation of tangible fixed assets
Depreciation of the Company’s tangible fixed assets is calculated by the following
methods.
■

Tangible fixed assets (excluding lease assets): Declining-balance method
However, buildings are depreciated using the straight-line method.

■

Lease assets related to finance lease transactions that do not transfer ownership:
Straight-line method over the lease term with no residual value

47

Asahi Mutual Life Insurance Company

(6) Foreign currency translation
Foreign currency-denominated assets and liabilities (excluding the shares of
unconsolidated subsidiaries and affiliates) are translated into Japanese yen at theeffective exchange rate prevailing at the balance sheet date, except for foreignexchange-traded funds for which hedge accounting is not applied, foreign bondexchange-traded funds for which hedge accounting is not applied and foreign
currency-denominated bonds for which hedge accounting is not applied categorized asavailable-for-sale securities with fair market value. Such securities are translated into
Japanese yen at the average of the effective exchange rate during the final month of the
fiscal year.
(7) Allowance for possible loan losses
Allowance for possible loan losses is provided in accordance with the Company’s standardsof self-assessment and write-offs and reserves on credit quality:i)

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

ii)

For credit to borrowers who are not currently bankrupt but have a high risk ofbankruptcy (hereinafter “not currently bankrupt borrowers”), the Company provides
the amounts deemed as necessary considering the borrowers’ ability to pay, within
the amounts after deductions of the amount expected to be collected through thedisposal of collateral or the execution of guarantees.

iii) For credit to borrowers other than the above, the Company provides the amounts
calculated by multiplying the book value by the actual ratio of bad debt losses on
defaults during a certain past period.
All credit is assessed by the relevant departments in accordance with the Company’s
standards of self-assessment on credit quality. The results of the assessment are reviewed
by the audit department, which is independent of business-related divisions. Subsequently,
allowance for possible loan losses is provided based on the results of these assessments.
For consolidated subsidiaries, the Company records the allowance amounts deemednecessary in accordance mainly with the Company’s standards of self-assessment andwrite-offs and reserves on credit quality.
For credit to legally bankrupt borrowers and substantially bankrupt borrowers, theamounts remaining after deductions of collateral value or the amounts collectible throughthe execution of guarantees are written-off directly from the book value as the estimateduncollectible amounts. The amount written-off as of March 31, 2020 was ¥34 million.

48

Asahi Mutual Life Insurance Company

(8) Accounting for employees’ retirement benefits and method of amortizing retirement
benefit expenses
Net defined benefit liabilities and assets are presented for the employees’ retirement
benefits after deducting pension plan assets from retirement benefit obligations, based on
estimated amounts as of the balance sheet date.
The Company uses the following methods of accounting in relation to retirement benefits.
■

The retirement benefit obligation is attributed to each period by the benefit formula
method.

■Actuarial differences are amortized under the straight-line method over a period ofseven years starting the following year.

■

Prior service cost is charged to income when incurred.

(9) Reserve for price fluctuation
Reserve for price fluctuation is calculated in accordance with Article 115 of the Insurance
Business Act.
(10) Accounting for hedging activities
Hedging activities are accounted for in accordance with the “Accounting Standards for
Financial Instruments” (Accounting Standards Board of Japan (“ASBJ”) Statement No.
10).
The Company mainly applies the following hedging activities:
The Company applies deferred hedge accounting and the exceptional accounting
treatment (“Tokurei-shori”) for interest rate swaps used to hedge the cash flow volatility ofcertain loans.
The Company also applies fair value hedge accounting for hedging activities related toforeign exchange rate fluctuation exposures on certain bonds, investment trusts andothers denominated in foreign currencies.
The Company also applies designated hedge accounting (“Furiate-shori”) for currency
swaps used to hedge foreign exchange rate fluctuation exposures on the foreign
currency-denominated bonds issued by the Company.
The Company also applies designated hedge accounting (“Furiate-shori”) for the foreign
currency-denominated transactions other than the above.
The effectiveness of a hedge is mostly assessed by a ratio analysis, comparing thefluctuations in the fair value or cash flows of hedged items and hedging instruments.

49

Asahi Mutual Life Insurance Company

(11) Accounting for consumption taxes
The Company and its subsidiaries account for consumption tax and local consumption tax
by the tax-exclusion method. The consumption taxes on certain assets, which are notdeductible from consumption taxes withheld and that are stipulated to be deferred under
the Corporation Tax Act of Japan, are deferred as prepaid expenses and amortized equally
over five years.
Consumption taxes other than deferred consumption taxes are recognized as an expense
when incurred.
(12) Policy reserves
Policy reserves are based on Article 116 of the Insurance Business Act and the premium
reserve at the end of fiscal year is calculated by the following method:
In regard to the policies subject to the standard policy reserves, the method as prescribedby the Commissioner of Financial Services Agency (Japanese Ministry of Finance Public
Notice No. 48, 1996) is applied.
In regard to the policies not subject to the standard policy reserves, the net level premium
method is applied.
(13) Software
Capitalized software for internal use owned by the Company and its subsidiaries (included
in intangible fixed assets in the consolidated balance sheet) is amortized using thestraight-line method over the estimated useful lives.
2.

Accounting Standards and Guidances Issued but Not Yet Effective

The accounting standards and relevant guidances issued by the fiscal year-end but not yet
effective are as follows:■ “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued on
July 4, 2019)■ “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ
Guidance No. 31, issued on July 4, 2019)■ “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, revised on
July 4, 2019)(i)

Overview
In these accounting standards and guidances, the guidance on the methods for measuring
fair velues of financial instruments are set to enhance comparability between Japanese
accounting standards and international accounting standards.

50

Asahi Mutual Life Insurance Company

(ii) Schedule date of adoption
The above revisions are scheduled to be applied from the beginning of the fiscal year
ending March 31, 2022.
(iii) Effects of application of the Accounting Standards and relevant guidances
The effects of the application are under assessment at the time of preparing these
consolidated financial statements.
3.

Financial Instruments

Asset management of the general accounts other than the separate accounts stipulated in
Article 118, Paragraph 1 of the Insurance Business Act is conducted based on the following
principles.
■

For accumulation whole life with variable interest rates, accumulation insurance withvariable interest rates and new single premium individual annuities which have aneffective date on or after April 2, 2012, the Company mainly invests in domestic bonds,
engaging in matching asset liability management, or Matching ALM, which aims atmatching the duration to outstanding insurance liabilities to avoid interest rate
fluctuation risks.

■

For individual life insurance and individual annuities other than above, the Company
holds yen-denominated fixed income investments, including bonds and loans, as the coreof its asset portfolio. The Company also holds domestic stocks, foreign securities and realestate assets to enhance its profitability.

Derivatives are mainly used to hedge market price fluctuation risk and exchange rate
fluctuation risk regarding securities and exchange rate fluctuation risk related to the foreign
currency-denominated bonds issued by the Company. As the major financial instruments,
securities are exposed to market risk and credit risk, loans are exposed to credit risk andexchange rate fluctuation risk, and derivatives are exposed to market risk and credit risk.
In managing market risks, the following two methods are used. One is the quantitative risk
management of securities etc. using the Value at Risk (“VaR”) method and the other is the risk
management by stress test and sensitivity analysis which analyze the effect on the Company’s
whole portfolio, simulating scenarios of deteriorating market environments. This is for the
purpose of managing an appropriate asset allocation within the ranges of acceptable risks.
In managing credit risks, the Company quantifies the credit risks of entire portfolio throughVaR method and controls the amount of risks within an acceptable range. Furthermore, theCompany assigns in-house credit ratings to our borrowers in accordance with thecreditworthiness of each borrower. Strict credit research of each borrower before lending aswell as following up on any changes of creditworthiness of each borrower after lending are
implemented by Risk Management Department, which is independent of the departments
executing investments and lending. Maximum limits of credit are set up for each borrower inaccordance with its credit risks to avoid the concentration of credit risks on specificcorporations and specific corporation groups. Through all these measures, the Company

51

Asahi Mutual Life Insurance Company

endeavors to develop high quality portfolio.

52

Asahi Mutual Life Insurance Company

The balance sheet amounts, fair values and the differences between those of major financial
assets and liabilities as of March 31, 2020 were as follows:
Millions of Yen
As of March 31, 2020

Cash and deposits
Call loans
Monetary claims bought
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Securities
Trading securities
Held-to-maturity debt securities
Policy-reserve-matching bonds
Available-for-sale securities
Loans
Policy loans
Industrial and consumer loans
Total assets
Bonds payable
Payables under securities borrowing
transactions
Loans payable
Total liabilities
Derivative financial instruments
Hedge accounting not applied
Hedge accounting applied

Balance Sheet
Amount¥35,22782,00026,91525,997918
4,353,757
20,372
308,469
2,050,330
1,974,584
377,91340,553
337,359
4,875,813
88,295

Fair Value¥

35,22782,00029,79628,878918
4,693,418
20,372
344,876
2,353,584
1,974,584
386,550
40,553345,997
5,226,993
81,164

Difference
¥

2,881
2,881
339,661
36,406303,2548,637
8,637
351,180(7,130)179,695

179,695-

51,000318,990
21,251566
20,684

52,776313,636
21,251566
20,684

1,776(5,354)-* Assets and liabilities generated by derivative financial instruments are offset and presented net.
Net liabilities in total are presented in parentheses.

(1) Securities including deposits and monetary claims bought which are treated as securities
based on “Accounting Standards for Financial Instruments” (ASBJ Statement No. 10)
As for available-for-sale securities of which market value is readily available, domestic
stocks, domestic stock exchange-traded funds, domestic listed real estate investment
trusts, foreign stock exchange-traded funds for which hedge accounting is not applied,foreign bond exchange-traded funds for which hedge accounting is not applied and foreign
currency-denominated bonds for which hedge accounting is not applied are stated at the
average of the market value during the final month of the fiscal year. Available-for-salesecurities of which market value is readily available excluding the securities mentioned
above are stated at the market value at the balance sheet date.
Other securities of which market value is readily available are stated at market value atthe balance sheet date.
Unlisted stocks and others, including investments in subsidiaries and affiliates, of whichmarket value is not readily available are not subject to fair value disclosure and are
therefore not included in the table above because it is regarded as extremely difficult to53

Asahi Mutual Life Insurance Company

determine their fair value.
The amount of the unlisted stocks and others, including investments in subsidiaries andaffiliates, reported in the consolidated balance sheet was ¥15,544 million as of March 31,
2020.
(2) Loans and loans payableAs credit exposure for policy loans without specific repayment periods is limited to theamount of the cash surrender value, the Company and its subsidiaries consider book value
as fair value with the assumption that fair value approximates book value in light offactors such as projected repayment period and interest terms.
As for industrial and consumer loans and loans payable, the fair value of loans is
primarily stated at theoretical prices calculated by discounting the future cash flows to thepresent value. The fair value of loans to legally bankrupt borrowers, substantiallybankrupt borrowers and not currently bankrupt borrowers is stated at the amounts bydeducting estimated losses from the book value before direct write-offs.
(3) Bonds payable
The fair value of bonds payable is based on the market values, etc. as of March 31, 2020.
(4) Payables under securities borrowing transactions
The Company considers book value as fair value with the assumption that fair value
approximates book value.
(5) Derivative financial instruments
The fair values of stock options and currency options traded over the counter are based on
the quoted prices offered by counterparty financial institutions.
The fair values of foreign currency forward contracts are stated at theoretical prices basedon the TTM at the balance sheet date.
Regarding the derivative transactions for which designated hedge accounting(“Furiate-shori”) of currency swaps is applied, these fair values are included in bonds
payable since they are treated together with hedged bonds payable.
4.

Investments and Rental Properties

The Company holds investment and rental properties such as office buildings in Tokyo andother areas. The carrying amount and the fair value of investment and rental properties were¥248,380 million and ¥288,820 million as of March 31, 2020. The fair value is mainly based on
the value (including some adjustments using the reference prices) of real estate appraisal
report prepared by the external real-estate appraiser in accordance with real estate appraisal
standards.

54

Asahi Mutual Life Insurance Company

5.

Securities Lent under Lending Agreements

The amount of securities lent under lending agreements was ¥225,171 million as of March 31,
2020.
6.

Loans

The total amount of loans to bankrupt borrowers, delinquent loans, delinquent loans three ormore months past due and restructured loans, which were included in loans, was ¥735 million
as of March 31, 2020.
i)

Loans to bankrupt borrowers were ¥2 million as of March 31, 2020.

ii)

Delinquent loans were ¥589 million as of March 31, 2020.

iii) Delinquent loans three or more months past due were ¥122 million as of March 31, 2020.
iv) Restructured loans were ¥20 million as of March 31, 2020.
Loans to bankrupt borrowers represent loans, excluding the balances already written-off,which meet the conditions prescribed in Article 96, Paragraph 1, Items 3 and 4 of the
Enforcement Regulations of the Corporate Tax Act. Moreover, accruing interest on these loans
is not recorded as income after determining that principal of or interest on these loans isunlikely to be collected due to the significant delay in repayment of principal or interest
payments or for other reasons.
Accruing interest on delinquent loans is not recorded as income due to the same reasons as
described above, and delinquent loans exclude loans to bankrupt borrowers and loans for whichinterest payments have been suspended and rescheduled to assist and support the borrowers
in the restructuring of their businesses.
Delinquent loans three or more months past due are loans for which interest payments or
repayments of principal are delinquent for three months or more from the due dates under theterms of the related loan agreements, excluding those loans classified as loans to bankrupt
borrowers and delinquent loans.
Restructured loans are loans for which certain concessions favorable to borrowers, such as
interest reduction or exemptions, rescheduling of due dates of principal or interest payments,
waivers of claim or other terms, have been negotiated for the purpose of assisting andsupporting the borrowers in the restructuring of their businesses. This category excludes loansclassified as loans to bankrupt borrowers, delinquent loans and delinquent loans three or moremonths past due.
The direct write-offs related to loans decreased the amount of loans to bankrupt borrowers
described above by ¥3 million as of March 31, 2020.
In addition, the direct write-offs related to loans decreased the amount of delinquent loans

55

Asahi Mutual Life Insurance Company

described above by ¥31 million as of March 31, 2020.
7.

Accumulated Depreciation of Tangible Fixed Assets

Accumulated depreciation of tangible fixed assets totaled ¥283,301 million as of March 31,
2020.
8.

Separate Accounts

Total assets in separate accounts provided for in Article 118 of the Insurance Business Act were¥24,381 million as of March 31, 2020. The amounts of separate account liabilities were thesame as separate account assets.
9.

Receivables from/Payables to Directors and Audit Board Members

There were no receivables from directors and audit board members as of March 31, 2020. The
total amount of payables to directors and audit board members was ¥15 million as of March 31,
2020.
10. Reserve for Dividends to Policyholders

Balance at the beginning of the fiscal year
Transfer to reserve from surplus in the previous fiscal year
Dividends to policyholders paid out during the fiscal year
Increase in interest
Decrease in others
Balance at the end of the fiscal year

Millions of Yen
Year ended
March 31, 2020¥
34,104
2,173
4,208
131
128
¥
32,073

11. Stocks of Unconsolidated Subsidiaries and affiliates
The amount of stocks of unconsolidated subsidiaries and affiliates the Company held as ofMarch 31, 2020 was ¥2,205 million.
12. Pledged Assets
Assets pledged as collateral as of March 31, 2020 were securities in the amount of ¥7,030
million.
13. Assets with Rights to Sell
The Company has the legal right to sell or collateralize securities borrowed under loan
agreements.
The market value of these assets that were not sold or pledged as collateral as of March 31,

56

Asahi Mutual Life Insurance Company

2020 was ¥72,765 million. No assets were pledged as collateral as of March 31, 2020.
14. Commitment LineAs of March 31, 2020, there were unused commitment line agreements under which theCompany is the lender of ¥9,418 million.
15. Subordinated Bonds Payable
As of March 31, 2020, bonds payable are subordinated bonds payable, for which therepayments are subordinated to other obligations.
16. Subordinated Loans Payable
As of March 31, 2020, other liabilities included subordinated loans payable of ¥51,000 million,
for which the repayments are subordinated to other obligations.
17. Contributions to Policyholders Protection Corporation
The estimated future contributions to the Life Insurance Policyholders Protection Corporationof Japan under Article 259 of the Insurance Business Act as of March 31, 2020 were ¥8,609
million. These contributions are charged as operating expenses in the fiscal years in which
they are paid.

57

Asahi Mutual Life Insurance Company

18. Deferred Taxes(1) Deferred tax assets/liabilities were recognized as follows:

Deferred tax assets
Valuation allowance for deferred tax assets
Subtotal
Deferred tax liabilities
Net deferred tax assets (liabilities)

Millions of Yen
As ofMarch 31, 2020¥
69,17322,487
46,68537,822¥
8,863

Major components of deferred tax assets/liabilities were as follows:

Millions of Yen
As ofMarch 31,2020Deferred tax assets
Contingency reserve
Reserve for price fluctuation
Net defined benefit liabilities
Losses on valuation of securities
Impairment losses
Net unrealized losses on available-for-sale securities
Deferred tax liabilities
Net unrealized gains on available-for-sale securities¥

14,447
12,061
9,762
9,642
7,743
6,279

¥

36,552(2) The statutory tax rate was 27.9% for the fiscal year ended March 31, 2020. The main
factors causing the difference between the statutory tax rate and the actual effective
tax rate after considering deferred taxes were as follows:

Interest on foundation funds
Reserve for dividends to policyholders

Year ended
March 31, 2020
(4.3)%(1.9)%

19. Accrued Retirement Benefits and Net Defined Benefit Liabilities(1) Summary of retirement benefit plans
As defined benefit plan, the Company and its consolidated subsidiaries have defined
benefit corporate pension plans, which are funded-type, and lump-sum retirement
allowance plans which are non-funded type but resulted in funded type due to setting of
employee pension trust.

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Asahi Mutual Life Insurance Company

(2) Defined benefit plani)

Reconciliation of beginning and ending balance of retirement benefit obligations

Retirement benefit obligations at the beginning of the fiscal year
Service cost
Interest cost
Actuarial difference occurred during the fiscal year
Retirement benefit payments
Retirement benefit obligations at the end of the fiscal year

ii)

Millions of Yen
Year ended
March 31, 2020¥
44,293
1,852
439
(231)
(4,288)¥42,065Reconciliation of beginning and ending balance of pension plan assets

Pension plan assets at the beginning of the fiscal year
Expected return on pension plan assets
Actuarial difference occurred during the fiscal year
Contributions by the employer
Retirement benefit payments
Pension plan assets at the end of the fiscal year

Millions of Yen
Year ended
March 31, 2020
¥
8,106
76
(905)
226
(246)
¥
7,258

iii) Reconciliation of retirement benefit obligation and pension plan assets with net
defined benefit liabilities and assets presented on the consolidated balance sheet

a. Funded plan retirement benefit obligationb. Pension plan assets
c. Net amount of liabilities and assets presented on the
consolidated balance sheet
d. Net defined benefit liabilities
e. Net defined benefit assets
f. Net amount of liabilities and assets presented on the
consolidated balance sheet

59

Millions of Yen
As ofMarch 31,2020¥
42,065(7,258)34,80634,985(178)¥

34,806

Asahi Mutual Life Insurance Company

iv) Breakdown of retirement benefit expenses

Service cost
Interest cost
Expected return on pension plan assets
Amortization of actuarial differences
Amortization of prior service cost
Retirement benefit expenses related to defined benefit planv)

Millions of Yen
Year ended
March 31, 2020
¥
1,852
439
(76)
909
6
¥
3,130

Breakdown of items included in other comprehensive income
The breakdown of items included in other comprehensive income (before tax effects)
was as follows:

Amortization of actuarial differences
Amortization of prior service cost
Total

Millions of Yen
Year ended
March 31, 2020
¥
236
6
¥
243

vi) Breakdown of items included in accumulated other comprehensive income
The breakdown of items included in total accumulated other comprehensive income(before tax effects) was as follows:
Millions of Yen
Year ended
March 31, 2020
¥
2,524
¥
2,524

Unrecognized actuarial differences
Totalvii) Breakdown of main pension plan assets
The breakdown of main asset categories as a percentage of pension plan assets was asfollows:
As ofMarch 31,2020
36%
16%
48%
100%

Stocks
Bonds
OthersTotal

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Asahi Mutual Life Insurance Company

viii) Method for determining the expected long-term rate of return
To determine the expected long-term rate of return on pension plan assets, theCompany takes into account the present and future allocation of pension plan assets,
and the present and expected future long-term rate of return on the diverse range ofassets that makes up the pension assets.
ix) Underlying actuarial assumptions
The main underlying actuarial assumptions were as follows:

Discount rate
Expected long-term rate of return on pension plan assets
Defined benefit corporate pension plans

61

As of
March 31, 2020
1.0%
0.9%
1.7%

Asahi Mutual Life Insurance Company

III. Notes to Unaudited Consolidated Statement of Income
1.

Investment Income and Expenses

The major components of gains on sales of securities were as follows:

Millions of Yen
Year ended
March 31, 2020¥
21,8322,020
1Domestic bonds
Domestic stocks and other securities
Foreign securities

The major components of losses on sales of securities were as follows:

Millions of Yen
Year ended
March 31, 2020
¥
690
2,120

Domestic bonds
Domestic stocks and other securities

The major components of losses on valuation of securities were as follows:

Millions of Yen
Year ended
March 31, 2020¥
368

Domestic stocks and other securities

Losses on derivative financial instruments included net valuation losses of ¥1,456 million for
the fiscal year ended March 31, 2020.

62

Asahi Mutual Life Insurance Company

IV. Notes to Unaudited Consolidated Statement of Comprehensive Income
Other Comprehensive Income
The reclassification adjustments and tax effect amounts related to other comprehensive income
were as follows:

Millions of Yen
Year ended
March 31, 2020
Net unrealized gains on available-for-sale securities, net of tax
Amount incurred during the fiscal year
Reclassification adjustments
Before tax adjustment
Tax effects
Net unrealized losses on available-for-sale securities, net of tax
Accumulated remeasurements of defined benefit plans
Amount incurred during the fiscal year
Reclassification adjustments
Before tax adjustment
Tax effects
Accumulated remeasurements of defined benefit plans
Total other comprehensive income

V.

¥

¥

(65)
1,253
1,188
(2,596)(1,408)
(673)
916
243
(67)
176
(1,232)

Notes to Unaudited Consolidated Statement of Cash Flows

Scope of Cash and Cash Equivalents
For the purpose of presenting the consolidated statements of cash flows, cash and cash
equivalents are comprised of cash on hand, demand deposits and all highly liquid short-term
investments with a maturity of three months or less when purchased, which are readily
convertible into cash and present an insignificant risk of changes in value.

63

Asahi Mutual Life Insurance Company

（6）Risk-monitored Loans(Millions of Yen, ％)As of March 31, 2019

As of March 31, 2020

02

Delinquent loans

619

589

Delinquent loans three or more months past due

110

122

Restructured loans

27

20

Total

757

735

(0.18)(0.19)

Loans to bankrupt borrowers（Percentage of total loans）

Notes:
1.For credit to legally bankrupt borrowers and substantially bankrupt borrowers, the amounts remaining after
the deductions of amount expected to be collected through the disposal of collateral or the execution ofguarantees are written-off directly from the book value as the estimated uncollectible amounts.
The amounts written-off related to loans to bankrupt borrowers were \3 million as of March 31, 2019 and\3 million as of March 31, 2020. The amounts written-off related to delinquent loans were \43 million
as of March 31, 2019 and \31 million as of March 31, 2020.
2.Loans to bankrupt borrowers represent non-accrual loans to borrowers which are subject to bankruptcy,
corporate reorganization or rehabilitation or other similar, including but not limited to foreign, proceedings.
Accruing interest on these loans is not recorded as income after determining that principal of or interest on
these loans is unlikely to be collected due to the significant delay in repayment of principal or interest
repayments or for other reasons.
3.Delinquent loans are loans whose accruing interest is not recorded as income and exclude loans tobankrupt borrowers and loans for which interest payments have been suspended and rescheduled to assist
and support the borrowers in the restructuring of their business.
4.Delinquent loans three or more months past due are loans for which interest payments or repayments ofprincipal are delinquent for three months or more from the due dates under the terms of the related loan
agreements, excluding those loans classified as loans to bankrupt borrowers or delinquent loans.
5.Restructured loans are loans for which certain concessions favorable to borrowers, such as interest reduction
or exemptions, rescheduling of due dates of principal or interest payments, waivers of claim or other terms,
have been negotiated for the purpose of assisting and supporting the borrowers in the restructuring of theirbusinesses. This category excludes loans classified as loans to bankrupt borrowers, delinquent loans anddelinquent loans three or more months past due.

64

Asahi Mutual Life Insurance Company

(7) Consolidated Solvency Margin Ratio(Millions of Yen)

As of March 31, 2019

As of March 31, 2020

813,038

856,773

Foundation funds and surplus

317,059

332,078

Reserve for price fluctuation

40,89043,230Contingency reserve

51,182

51,782

Catastrophe loss reserve--

General allowance for possible loan losses

50

47(Net unrealized gains on available-for-sale securities (before tax effect) and deferredhedge gains (before tax effect)) × 90% (in case of losses： × 100%)

115,807

116,877

Net unrealized gains on land × 85%

10,43427,786(2,768)(2,524)

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

132,013137,190

Qualifying subordinated debt

138,495

138,095

Excess amount of policy reserves based on full-time Zillmer method and qualifying
subordinated debt excluded from the calculation of solvency margin--

Deduction

-

-

9,873

12,211

187,822

180,611

Total solvency margin（Ａ）(in case of losses： × 100%)

Sum of unrealized actuarial differences and unrealized past service cost

OthersTotal amount of risk(

R R R R ) ( R R R ) R R
2

2

1

5

2

8

9

2

2

3

7

4

6

（Ｂ）

Insurance risk

R1

13,77913,155

Ordinary insurance risk

R5

-

-

Disaster insurance risk

R6

-

-

Third sector insurance risk

R8

9,622

9,974

Small amount short-term insurance provider insurance risk

R9

-

-

Risk of assumed yield

R2

75,362

72,246

Minimum guarantee risk

R7

1,069

1,055

Investment risk

R3

105,782

101,822

Operational risk

R4

4,112

3,965

865.7%

948.7%

Solvency margin ratio(Ａ) / {(1/2)×(Ｂ)} × 100

Notes:
1. The figures above are calculated based on Articles 86-2 and 88 of the Ordinance for Enforcement of the Insurance Business Act and the Public Notice No.23
of the Financial Service Agency of 2011.
2. "Excess amount of policy reserves based on full-time Zillmer method", "Qualifying subordinated debt" and "Excess amount of policy reserves based on
full-time Zillmer method and qualifying subordinated debt excluded from the calculation of solvency margin" are calculated based on the Public Notice No.25
of the Financial Service Agency of 2011.
3. "Minimum guarantee risk" is calculated by standard method.

(8) Segment information
The Company and its consolidated subsidiaries operate investment advisory business, etc., in addition to life insurance businessin Japan. However, information on these segments and related information are omitted because they represent such a minor proportionof total segments.

65

Asahi Mutual Life Insurance Company