Chiba Bank’s Value Creation

History of the Chiba Bank Group
Chibagin Head Office Building (completed
construction in September 2020)2024.3
Capital stock: ¥145 billion

Number of employees: 3,982
Number of branches: 184

Second Head Office
Balance of loans

8Balance of deposits

Deposits: ¥15,951.6 billion
Loans and bills discounted:¥12,768.0 billion

Population of Chiba Prefecture
7First Head Office6.26 million people
Chiba Bank’s Value Creation(millions of people)

Messages

Chiba Bank marked the 80th anniversary of its establishment in March 2023. The scale of ourbusiness is growing, meeting the diverse needs of our customers as a regional financial institution.
Looking ahead, the Chiba Bank Group will pursue continuous growth together with our regional
communities.

2019.3Loans and bills
discounted reached¥10 trillion

March 1943 (at the time of establishment)(¥ trillion)

Capital stock: ¥10 million
Number of employees: 725
Number of branches: 70
Deposits: ¥247.02 million
Loans and bills discounted:¥51.59 million

6

2014.3
Total deposits
reached¥10 trillion

1.62 million people

2

10

8

1983.3
Total deposits
reached¥3 trillion

6

4

2

0

0
1943.31950.3

Establishment-

1960.31960s-

Our
Transition

1943.3

1986.10

Appointed the first female
Branch General Manager
among Japanese banks

1964.2

Set a sunflower as the bank flower

1964.4Entered into an agreement with
Chiba Prefecture to be adesignated financial institution forbusiness handling1987.4Opened first overseas branch in
New York

1990.2

Established Chibagin ResearchInstitute1970.10 Listed on the 2nd section of theTokyo Stock Exchange

1991.10

Established Oyumino Center

1995.3

Held the first “Chibagin Cup”
(J. League pre-season match)

1998.3Acquired Chuo Securities(currently Chibagin Securities)
as a Group company

1971.8Changed to the 1st section of theTokyo Stock Exchange

1971.10 Started operation of the first online
system1973.3

Built the new Head Office building
and relocated the Head Officefrom Chuo to Chiba-minato

1973.10 Introduced the first CD machine at
the Chiba Ekimae Branch
Issued “Chibagin Cash Card”

The Chiba Bank Integrated Report 2024

1980s-

1990.3

2000.32000s2015.10 Launched the TSUBASA Alliance2016.3

Launched the Chiba-Musashino Alliance2019.7

Launched the Chiba-Yokohama Partnership2010.32020.32024.3The “Chiba Bank’s 80-Year History” Special Site (available in Japanese only)
In January 2024, a special site for the “Chiba Bank’s 80-Year
History” was launched on the Bank’s website, as part of theBank’s 80th anniversary project. This site presents the
Bank’s history from its establishment in the Showa era
through the Heisei era to the Reiwa era while focusing historyof the most recent 10 years.

2020s2020.9

Completed construction of Chibagin Head
Office Building

2021.5

Established Chibagin Market

2023.4

Established Himawari Green Energy

2023.11 Established TSUBASA-AML Center

Financial and Corporate Data

Founded as a result of
the merger of threebanks, Chiba Godo
Bank, Omigawa
Agricultural andCommercial Bank, andthe Kujuhachi Bank

Deposits and loans grew inresponse to high economic growth

1980.3

1970.3

Management Base Supporting Value Creation

1960-

27

Human Capital Management

1975.9Total deposits
reached¥1 trillion

1963.9Total deposits
reached¥100 billion

1

12

1988.9Total deposits
reached¥5 trillion

4

3

14

Growth Strategy for Value Creation

5

16

QR code to the site

https://www.chibabank.co.jp/company/info/80th/

The Chiba Bank Integrated Report 2024

28

Chiba Bank’s Value Creation

Strengths of the Chiba Bank Group

Deposits and savings in Chiba Prefecture*

5.2

5.8

6.7

2008/3

2013/3

2018/32023/38.0

9.4

2008/3

2013/3

2018/3

Source: The Kinyu Journal*Including negotiable certificates of deposit

Business Base

Deeply Diverse Customer Base

184
6

Overseas Network%

Chiba*2
Market Share of Deposits andDesignated Financial
Institution for
Coordination Agreement for Regional
Revitalization Concluded with44
26

out of 55 local governments

to Receive Pensions
Number of Customers
Receiving Housing Loans
Number of Companies Using
Chiba Bank as Their Main Bank** Source: Teikoku Databank*1 181 branches and 3 money exchange counters*2 Source: The Kinyu Journal, as of March 31, 2023

accounts
customerscompanies

Top-Class Profitability Among the Regional Banks
Profit Attributable to Owners of
Parent (Consolidated)out of 55 local governments

accounts

Human Capital Management%

Savings in Chiba Prefecture*2

to Receive Salaries
Number of Accounts Usedlocations

40.5
28.5

Market Share of Loans in

862 thousand
498 thousand
207thousand
21thousand

Number of Accounts Usedlocations

Branches: New York, Hong Kong, London
Representative Offices: Shanghai, Singapore, Bangkok

ROE (Consolidated, based on

62.4
6.40

billion%Shareholders’ Equity)

Low Expense Ratio(Consolidated):
Loans and Bills Discounted(Non-Consolidated):
Deposits¥15,951.6

billionbillion(Consolidated)
Common Equity Tier 1 Capital
Ratio (Consolidated)%

Sound Loan Assets
Non-Performing Loan Ratio

0.92(Non-Consolidated and based on%

the Financial Reconstruction Act)billionExcellent Ratings*
Moody’s

Robust Capital
Total Capital Ratio

48.76

OHR (Consolidated)

16.24
16.20

%

%

Standard & Poor’s

Rating and Investment
Information

A1
AAA-

(Long-term)(Long-term)(Long-term)

P-1
A-2

Financial and Corporate Data

(Non-Consolidated):¥21,323.8¥12,768.0

Management Base Supporting Value Creation

Total Assets

The Chiba Bank Integrated Report 2024

Source: The Kinyu Journal(As of March 31, 2024 or for the fiscal year ended March 31, 2024, unless otherwise noted)

Alliances29

2023/3Chiba Bank’ s market share (%)
Total amount of deposits and savings in Chiba Prefecture (¥ trillion)
Total amount of deposits and savings provided by the Chiba Bank (¥ trillion)

Top-Class Asset Size Among the Regional Banks

The Bank is deepening its alliances and partnerships with three main alliances, TSUBASA Alliance,
Chiba-Musashino Alliance, and Chiba-Yokohama Partnership, and is collaborating with Sony Bank invarious ways to improve our financial services through DX. The advanced alliance strategy which wasestablished prior to other banks differentiates us from others at a maximum level and has increased
our presence.
The annual effect of the alliances on the Bank’s PL is approximately ¥6.0 billion for the top line andapproximately ¥2.0 billion for cost reduction, making a total of around ¥8.0 billion, which leads to the
Bank’s low OHR. We will strive to enhance corporate value of the Bank and our partner banks byutilizing the strength of the alliances and deepening collaboration. (See pages 59-62 for specificinitiatives)

14.7

11.4

Growth Strategy for Value Creation

The total assets (consolidated) of the Bank amounts to approximately ¥21.3 trillion, and loans and bills
discounted (non-consolidated) exceeds ¥12 trillion. In addition, our consolidated profit (profit
attributable to owners of parent) is ¥62.4 billion, boasting a top-class asset size and profitability
among the regional banks.
Meanwhile, the low expense ratio is our major feature, with ROE (consolidated) being 6.40%,
increasing for three consecutive terms, and OHR (consolidated) being 48.76%, in the upper 40%
range. The stable ROE and low OHR show our efficient business operations.
Our total capital ratio (consolidated) is 16.24% and common equity Tier 1 capital ratio(consolidated) is 16.20%. We also maintain a high level of financial soundness with non-performing
loan ratio (non-consolidated) of 0.92%, which is less than 1%.
Thanks to these figures, the Bank remains high in external credit ratings (long-term) performed bycredit rating agencies, such as A1 by Moody’s, A- by Standard & Poor’s, and AA- by Rating andInvestment Information.

7.8

Chiba Bank’ s market share (%)
Total amount of loans in Chiba (¥ trillion)
Total amount of loans provided by the Chiba Bank (¥ trillion)

Domestic Network*1

Financial Base

51.7

43.8

38.7

35.2

28.5

26.0

24.3

22.9

19.3

16.8

15.0

14.1

40.5

40.4

38.6

36.9

Chiba Bank’s Value Creation

The Bank has a branch network of 184 domestic locations, mainly in Chiba Prefecture, and 6
overseas locations.
In Japan, we have secured contact points with customers, and provided optimal services that meetcustomers’ needs in the region by opening branches in Ibaraki Prefecture and Saitama Prefecture in
addition to central Tokyo, which is adjacent to Chiba Prefecture, while also consolidating existing
branches and integrating functions of branches.
Overseas, we have branches in New York, Hong Kong, and London and representative offices invarious locations in Asia (Shanghai, Singapore, and Bangkok), which constitute a top-level overseas
branch network as a regional bank.
With this branch network, we have won an overwhelming share of the market in Chiba Prefecture(40.5% share of lending and 28.5% share of deposits in the prefecture), our main operating area, as
we serve as the main bank for over 20,000 companies, supporting the business activities ofcustomers, and we are the designated financial institution of 44 out of 55 local governments in theprefecture.

Loans in Chiba

Messages

Operating Base

(Short-term)(Short-term)* As of July 1, 2024

The Chiba Bank Integrated Report 202430

Chiba Bank’s Value Creation

Value Creation Process
VisionTo create a local community better suited to bringing each person’s hope to life

An Engagement Bank Group that works closely with the community

Social Issues

ImpactPopulation
declineDemographic
aging

Response
to DX

Response
to GX

Diversifying
valuesMessages

PurposeTo lead the local community towards becoming

Change inbehavioral
patterns

Chiba Bank’s Value Creationa place where all of our stakeholders’ hopes can come to life
Contributing to achieving the SDGs and enhancing corporate value
through the creation of “functional value” and “social value”

Activities

Input

Diverse specialists
Cross-group personnelvironOperational Guideline

P.35

services utilizing expertiseAg
rm

Create “social value” such as contributing
to solving regional issues

es for the elderlyr e li v

Financialservicesv id eDX

Pursuesignificant
expertise
KPI

finan

c ia l S e r vic e s

c ia l s e r vi c e s f o r a b e

GX
Alliances

P.51
Base II

P.55

l if
tt e re

HumanCapitalGroup
GovernanceBase V

P.63
Base IV

Base III

P.59

P.77

Improveconvenience

Solutions to regional social issues
Corporate businessand supporting
local governments

Retail Business
P.45

P.47

P.36

Targets for
FY2025

Target level for
FY2030Consolidated ROE(shareholders’ equity basis)

Lower
7% range

Around 8%

Profit attributable toowners of parent¥75.0 billion¥100.0 billion

Consolidated
net business income¥120.0 billion

Consolidated
common equity
Tier 1 capital ratio*

10.5% - 11.5%

Consolidated OHR

Around 45%

Provisionof values that
resonate with customers
Sustainablegrowth of companies
in the region

Job creation

Createmore fans

Higher income

Financial and Corporate Data

Base IFin a nNon-financial
services=s

resources in the region

Create “functional value” such asproviding financial functions

afe

fo

Su

P ro

Network of collaboration

Rich nature and tourism

Social valuetsremajor market

Natural Capitalu l a ti o nProviding new valueec uBasic Policy III.

Pop

Enhancing the quality of existing businessin g

Basic Policy II.

Prefecture, the Group’s

with other banks

Functional value

Management Base Supporting Value Creation

Creating the optimal customerleGrowth potential of Chiba

Basic Policy I.

s ty

Deeply diverse customer basey

Solid business baseo rkSocial and Relational Capitalr s itdw

Low expense ratio

Dive

Robust capital

Outcomeoramong the regional banks

Basic Policies

ppTop-class asset size and profitability

P r o m o te d i v e rs it y a n

Financial Capital

OutputHuman Capital Management

Evolution of thecustomer-focused business model

Unified Groupds

Specialized products and

The 15th Mid-term PlananIntellectual Capital

en
m

ities
mun
om
dc

Con
trib
ute
to
the
pr
En

management

an
y
nit
my
no
mu
m
Co

Regio
of r
nal
egi
ona
Eco
l ec
no
o
my
an
d

fa
tion
no
tec
tc io
o
r
e
P
ot
tal

Growth Strategy for Value Creation

Human Capitalcomprehensive solutions

Improveengagement

Materiality
P.33 Contrib
nment
ute tothe venviroelbitaliz
a
n
i
atio
a
t
s
n
su

Increased consumer
spending, etc.
Prosperous lifestyles*Full implementation of finalized Basel III standards (excluding valuation differences on securities)

andEmployees Motivation
remuneration Investors Dividend

P.74

Strengthen our bases
31

The Chiba Bank Integrated Report 2024

The Chiba Bank Integrated Report 2024

32

Chiba Bank’s Value Creation

Initiatives for “Sustainable Management”
Initiatives related to Materiality
Regional Economy and Community

The Bank Group works on initiatives for “sustainable management,” aiming at balancing economic
value and social value over the long term.

Contribute to the vitalization of regional economy and communities

Aging Population
Support safe and secure lives for the elderly

Financial Services

VisionTo create a local community better suited to bringing each person’s hope to life

An Engagement Bank Group that works closely with the community

Provide financial services for a better life

Diversity
Promote diversity and work style reforms“Chiba Bank Group Sustainability Policy”

Environmental Protection

We aim to realize sustainable regional communities through our core businesses such as demonstrating the financial intermediation
function. Additionally, we engage in honest and fair corporate activities, as well as activities to solve various issues facing the region,
including climate change and other environmental problems, as part of sustainable management with the aim of balancing economic
value and social value.
Each executive and employee of our group is actively working with awareness of their involvement in these activities. Throughinformation disclosure, we will foster a better relationship of trust with our stakeholders and create a “new future for regional communities.”

Contribute to the vitalization of regional economy and communities

2 Aging Population

Support safe and secure lives for the elderly

3 Financial Services

Provide financial services for a better life

4 Diversity

Promote diversity and work style reforms

5 Environmental Protection

Contribute to the protection of a sustainable environment

The Chiba Bank Group’s Corporate Code of Conduct

Chiba Bank Group Human Resources Development Policy“Become someone who keeps fighting for the customer.” Think things
through, utilize your own strengths, and gain more supporters

Chiba Bank Group Environmental Policy

Promoting sustainable finance (page 55)

Human Rights Policy (page 34)
Supporting balance between work and childcare (page 83)

TSUBASA cross-mentor system (page 84)

Response to climate change (pages 67 to 72)
Response to natural capital (page 73)

Initiatives for carbon neutrality in FY2030 (page 71)

Initiatives for Respecting Human Rights
Human rights are common universal rights everyone is born with. In the Bank Group, not only
executives and employees but also customers and suppliers (to which our services are entrusted) areworking on respect for human rights.

Human Rights Policy

For details of the Chiba Bank Group Human Rights Policy, see our website:
https://www.chibabank.co.jp/english/corporate/policy/human_rights/

Corporate Code of Conduct
Chiba Bank Group Procurement Policy

Governance System for Sustainability and Process for Identifying Materialities (Key Issues)
Board of Directors
Report/discuss

Supervise

We declared the Chiba Bank Group’s Corporate Code of Conduct in April 2021.
This code of conduct states the basic policy for carrying out ethical and responsible corporate activities as
the Chiba Bank Group, which is a “company” to be a part of society and a “bank” to take social responsibility
and public mission. For respecting human rights, the code of conduct states that the Chiba Bank Group
respects the human rights of all people, including officers and employees, and customers.
For details of the Chiba Bank Group’s Corporate Code of Conduct, see our website:
https://www.chibabank.co.jp/english/corporate/policy/behavioral_guidelines/

Board of Designated Directors

Complying with the UK Modern Slavery Act 2015

Sustainability Promotion Committee

As Chiba Bank has a branch in London, the UK, we have published annual statements for compliance with the
UK Modern Slavery Act 2015 since its establishment.
The statement states not only the operation in our London Branch but also an intention that we would
eliminate the violation of human rights by slave labor, human trafficking, etc. in the Bank’s overall operation torespect human rights, and also asks our suppliers to respect, and not infringe, human rights.

SDGs Promotion Office in the Corporate Planning Division(secretariat of the Sustainability Promotion Committee)
Report/discuss
Headquarters

Collaborate
Branches

Direct/manage
Group companies

Management Base Supporting Value Creation

The Bank Group has built a flexible and solid governancesystem for “sustainable management,” aiming at balancing
economic value and social value over the long term. The
Sustainability Promotion Committee is primarily
responsible for the formulation and implementation ofvarious measures for sustainability, and discusses anddeliberates on the direction of sustainability management,
specific activities and initiatives, and the identification andevaluation of risks and opportunities. Discussions anddeliberations in the Committee are reported to anddiscussed by the Board of Directors.

Expanding features of the Chiba Bank app (page 52)
Expanding features of Chibagin Business Portal (page 52)

The policy states that the Bank Group respects the human rights of all executives and employees to provide asuitable working environment, and will not tolerate discrimination, harassment, or human rights violation basedon race, gender, nationality, etc. The policy also asks our customers and suppliers to respect, and not infringe,
human rights.

Diversity Action Declaration
Chiba Bank Group Human Rights Policy

Initiatives to prevent financial crimes including wiretransfer fraud (page 96)

Human Capital Management

Basic policy for carrying out ethical and responsible corporate activities

Inheritance-related services and trust business(page 46)

Growth Strategy for Value Creation

Chiba Bank Group Declaration on SDGs
1 Regional Economy and Community

Contribute to the protection of a sustainable environment

Utilizing real estate funds (page 48)

Chiba Bank’s Value Creation

PurposeSupport for regional revitalization (pages 49 and 50)
Advisory services for business operators (page 47)

Messages

Sustainability Policies

Financial and Corporate Data

For details of the UK Modern Slavery Act 2015, see our website:
https://www.chibabank.co.jp/english/corporate/pdf/ModernSlavery.pdf

Process for Identifying Materialities (Key Issues)
Understand SDGs,
affirm the significance of sustainable management,
and review the Bank’s CSR activities

Comprehensively enumerate social
issues faced by the world andJapan’s Chiba Prefecture

33

The Chiba Bank Integrated Report 2024

Supplier monitoring
May 2019
Identified five materiality themes

Learn about social interests and intentions from stakeholders
Regional communities: Regional revitalization andprotection of natural environment
Customers: Demonstration of our financial intermediation
function and advanced financial services

Employees: Rewarding workplace where employees candemonstrate their full potential
Shareholders: Improvement of corporate value in themedium to long term

The Chiba Bank Group clearly expresses the Chiba Bank Group Human Rights Policy and the Chiba Bank
Group Procurement Policy to our suppliers and asks them to understand and comply with the policies. In
addition, we conduct monitoring once a year to confirm that the suppliers have no violations of human rights.
For details of the Chiba Bank Group Procurement Policy, see our website:
https://www.chibabank.co.jp/company/sustainability/policies/procurement.html

The Chiba Bank Integrated Report 2024

34

Chiba Bank’s Value Creation

Progress status of mid-term plan
Target Figures

The 15th Mid-term Plan
Phase 1Engagement Bank Group

Plan Period: April 1, 2023 to March 31, 2026

Operational Guideline Evolution of the customer-focused business model

Basic Policy

Basic Policy

I

II

III

Creating the optimal
customer

Enhancing the qualityof existing business

Providing
new value

Deliver personalized
proposals utilizing a wide
range of data.
Provide in-person, remote,and digital channels
most-suited to the customer.

Further increase
the quality of solutions
designed to address
customer issues.

Provide new-foundvalue to customers
by entering into
new business areas.

Expansion of “Value Creation Bases”
Base I

GX

6.40%

Lower 7%
range

Around 8%

Profit attributable toowners of parent¥60.2 billion¥62.4 billion¥75.0 billion¥100.0 billion

Consolidated net businessincome¥81.8 billion¥91.7 billion¥120.0 billion

11.87%

10.5% - 11.5%

48.76%

Around 45%

Consolidated OHR

10.57%(Before application of finalized
Basel III standards)

47.37%*Full implementation of finalized Basel III standards (excluding valuation differences on securities)

Progress toward targets
The abovementioned five management KPIs, including a consolidated ROE, are set as financial
targets in the Mid-term Plan “Engagement Bank Group - Phase 1 -.”As long-term targets, we are aiming for a consolidated ROE of around 8% and a profit attributableto owners of parent of 100.0 billion yen in FY2030.
Amid a drastically changing external environment, we worked to provide solutions to social issues
such as transforming customer experiences by providing a highly convenient Chiba Bank app,sustainable finance, and accompanying support for business improvement by the Business
Consulting Office, while also utilizing alliances. In addition, we have strengthened the entry into new
business areas such as renewable energy power generation business and advertising business.
As a result, all figures in the first fiscal year of the Mid-term Plan made good progress, including¥62.4 billion in profit attributable to owners of parent versus a target of ¥61.0 billion.

Base IV

Alliances

Human Capital

Future responses
Base VGroup Governance

Financial and Corporate Data

Base IIIThe Chiba Bank Integrated Report 2024

Target level for
FY2030Base II

DX

35

Targets for
FY2025

Management Base Supporting Value Creation

Value Creation Bases

Results for
FY2023

Human Capital Management

Basic Policy

Results for
FY2022Growth Strategy for Value Creation

Practice “Sustainable Management” by providing social value to the community(Final fiscal year)

6.38%

Consolidated common
equity Tier 1 capital ratio*

Basic Policies(First fiscal year)

Chiba Bank’s Value Creation

Consolidated ROE(shareholders’ equity basis)(Reference)

Messages

As a strategy to realize our Purpose and Vision, we have set, for our operational guideline, theMid-term Plan “Engagement Bank Group - Phase 1 -,” which aims for “Evolution of the customerfocused business model.” Under the Plan, we will further increase engagement with customers bychanging our perspective in providing products and services and creating the optimal customer.
Under the three “Basic Policies,” we will improve our customer service and strengthen the five“Value Creation Bases” that support these policies.

We recognize that for the Chiba Bank Group to grow sustainably, we need to further enhance ourstrengths, continue to deepen our existing businesses and take on the challenge of new businesses
as a growth strategy, and apply our business improvement plan to future growth.
While strengthening these initiatives, we will strengthen our profitability and improve capitalefficiency to achieve five target figures in the final fiscal year through provision of values that resonate
with customers.

The Chiba Bank Integrated Report 2024

36

Chiba Bank’s Value Creation

Financial Results and Conditions

Overview

YoY

168.2

12.6

Net interest income

140.3

136.6

(3.7)

Net fees and commissions

28.6

30.0

1.4

Net trading income

1.3

1.1

(0.2)

Net other ordinary income(14.8)

0.3

15.1

Gains/losses related to bonds(20.0)

(5.8)

14.1

G&A expenses (-)

82.5

85.1

2.5

Real net business income

73.0

83.1

10.0

Core business income

93.0

88.9

(4.0)

Excl. gains/losses on the cancelation of investment trusts

85.3

87.4

2.0

Net provisions to general allowance for loan losses (-)

—

—

—

73.0

83.1

10.0
(5.7)

Net business income
Non-recurring gains/losses

8.7

2.9

Disposal of non-performing loans (-)

0.3

5.8

5.5

Reversal of loan loss reserves

0.9

0.3

(0.5)

8.3

9.3

1.0

Ordinary profit

Gains/losses related to stocks, etc.

81.7

86.0

4.3

Extraordinary gains/losses

(0.3)

(0.2)

0.0

Profit

58.1

60.5

2.4

Credit-related expenses (-)

0.3

5.8

5.5
(¥ billion)(Consolidated)

2023/32024/3

YoY

Ordinary profit

86.9

90.2

3.2

Profit attributable to owners ofparent

60.2

62.4

2.1

(Reference)
Consolidated net business income(before provision to general allowance for loan losses)

81.8

91.7

Breakdown of net interest income
2023/3
Net interest income

9.8(¥ billion)

2024/3

YoY

140.3

136.6

(3.7)

131.5

132.2

0.7

Interest on loans and deposits

100.2

104.2

3.9

Domestic
Loans and bills discounted

100.5

104.5

3.9

Interest and dividends on securities

28.7

26.0

(2.6)

Other (market operations, etc.)

2.5

1.9

(0.6)

8.8

4.4

(4.4)

Overseas
Loans and bills discounted

13.5

27.1

13.5

Foreign securities

19.1

27.0

7.8

Other (funding, market operations, etc.)(23.8)(49.7)(25.8)Net interest income (excl. gains on the cancelation of investment trusts)

132.6

135.1

2.4

Gains on the cancelation of investment trusts

7.6

1.5

(6.1)

(¥ billion)(Non-consolidated)

YoY

2023/3
28.6

Net fees and commissions

2024/3
30.0

1.4

(0.3)

<Main breakdown>
Investment trusts and personal annuities

6.3

5.9

Corporate solutions

15.7

16.6

0.9

Trust/inheritance-related business

1.4

1.5

0.0

Cashless operations

1.6

2.8

1.1

Payment and settlement transactions

12.5

12.9

0.3

Guarantee charges and group insurance costs (-)

13.0

13.9

0.8

Earnings Projections for the Fiscal Year Ending March 31, 2025
For the fiscal year ending March 31, 2025, grossbusiness profit is projected to increase ¥14.7 billion
year on year to ¥183.0 billion due to an increase in
net fees and commissions and the absence of the
impact of foreign bonds loss-cutting conducted in
the previous fiscal year, in addition to an increase in
net interest income due to an increase in domestic
interest on loans and deposits as a result of anincrease in loans and bills discounted and risinginterest rates.
G&A expenses are projected to increase ¥3.4
billion year on year to ¥88.5 billion primarily due towage increases and a rise in cost of strategic
investments.
As a result, real net business income is projected
to increase ¥11.3 billion year on year to ¥94.4 billion,
and core business income excluding gains/losses on
the cancelation of investment trusts is projected toincrease ¥2.9 billion year on year to ¥90.4 billion.
Credit-related expenses, on the other hand, areconservatively projected to increase ¥1.6 billion year
on year to ¥7.5 billion in light of the environment
where impact on the economy has remained
uncertain, such as rising prices and the yen’s
depreciation.
As a result, ordinary profit is projected to increase¥8.2 billion year on year to ¥94.3 billion and profit isprojected to increase ¥6.3 billion year on year to¥66.9 billion.
On a consolidated group basis, ordinary profit isprojected to increase ¥7.6 billion year on year to¥97.9 billion and profit attributable to owners ofparent is projected to increase ¥5.5 billion year on
year to ¥68.0 billion.

Earnings projections(¥ billion)(Non-consolidated)

2024/32025/3(Plan)

YoY

Gross business profit

168.2

183.0

Net interest income

136.6

146.0

14.7
9.3

Net fees and commissions

30.0

31.7

1.6

Net trading income

1.1

2.2

1.1

Net other ordinary income

0.3

3.0

2.6
7.2

(5.8)

1.3

G&A expenses (-)

Gains/losses related to bonds

85.1

88.5

3.4

Net business income (before provision to general allowance for loan losses)

83.1

94.4

11.3

Core business income

4.1

88.9

93.1

Excl. gains/losses on the cancelation of investment trusts

87.4

90.4

2.9

Net provisions to general allowance for loan losses (-)

—

0.9

0.9

Net business income

83.1

93.5

10.4

Non-recurring gains/losses

2.9

0.7

(2.2)

Disposal of non-performing loans (-)

5.8

6.6

0.7

Reversal of loan loss reserves

0.3

—

(0.3)
(2.3)

9.3

7.0

Ordinary profit

Gains/losses related to stocks, etc.

86.0

94.3

8.2

Extraordinary gains/losses

(0.2)

(0.2)

0.0

Profit

60.5

66.9

6.3

Credit-related expenses (-)

5.8

7.5

1.6

Financial and Corporate Data

The Chiba Bank Integrated Report 2024

2024/3

155.5

Breakdown of net fees and commissions

Management Base Supporting Value Creation

37

2023/3

Net fees and commissions increased to ¥30.0 billion,
reaching record high for four consecutive terms.
Attributable to proposals that were based on theneeds of corporate customers, corporate solutions
fees and commissions increased by ¥0.9 billion year
on year to reach a record high and led the overall
increase in net fees and commissions.
Fees and commissions from investment trusts andpersonal annuities declined overall by ¥0.3 billion
year on year due to a decrease in annuities andwhole-life insurance fees.
Trust/inheritance-related business fees andcashless operations fees increased to a record high.

Human Capital Management

Net interest income decreased by ¥3.7 billion year on
year to ¥136.6 billion mainly due to a decrease ingains on the cancellation of investment trusts.
Domestic net interest income increased by ¥0.7
billion year on year. Interest on loans and discounts
increased by ¥3.9 billion year on year due to a steadyincrease in domestic loans and bills discounted as aresult of our proactive responses to the needs ofcustomers, and dividends from investment trusts
increased on the back of rising stock prices, etc.
Overseas net interest income decreased by ¥4.4
billion primarily due to a decrease in gains on thecancellation of investment trusts.

(Non-consolidated)
Gross business profit

Net fees and commissions

Growth Strategy for Value Creation

Net interest income

Summary of financial results for the Fiscal Year Ended March 31, 2024 (¥ billion)

Chiba Bank’s Value Creation

While net interest income decreased by ¥3.7 billion
year on year, net fees and commissions income werestrong and increased by ¥1.4 billion year on year,
reaching a record high. In addition, gains/losses
related to bonds improved by ¥14.1 billion year on
year due to the absence of the impact of foreign
bonds loss-cutting conducted in the previous fiscal
year. As a result, gross business profit increased by¥12.6 billion year on year to ¥168.2 billion.
G&A expenses increased by ¥2.5 billion year on year
due to investment in human capital and strategic
investments, which are within the scope of our plan,and consolidated OHR has maintained a high efficiencyof 48%.
Real net business income increased by ¥10.0
billion year on year to ¥83.1 billion. The Bank’s corebusiness income excluding gains/losses on thecancellation of investment trusts was strong,increasing for five consecutive terms to ¥87.4 billion.
Credit-related expenses were a provision of ¥5.8
billion. Credit-related expenses increased by ¥5.5
billion year on year primarily due to the absence oflarge recoveries of written-off claims in the previous
fiscal year and making preventive provisions forsome loans in light of the current environment.
Ordinary profit increased by ¥4.3 billion year on
year to ¥86.0 billion, and profit increased by ¥2.4
billion year on year to ¥60.5 billion.
On a consolidated group basis, ordinary profit
increased by ¥3.2 billion year on year to ¥90.2 billion
and profit attributable to owners of parent increasedby ¥2.1 billion year on year to ¥62.4 billion, bothreaching record highs for two consecutive terms.

Messages

Financial Results for the Fiscal Year Ended March 31, 2024(¥ billion)(Consolidated)

2024/32025/3(Plan)

YoY

Ordinary profit

90.2

97.9

7.6

Profit attributable to owners ofparent

62.4

68.0

5.5

91.7

105.2

13.4

(Reference)
Consolidated net business income(before provision to general allowance for loan losses)

The Chiba Bank Integrated Report 2024

38

Chiba Bank’s Value Creation

Improving our P/B Ratio

The Bank’s P/B ratio is approximately 0.8*, which is a top-class figure for a regional bank. However, it
has been trending below 1 for some time. In order to raise the ratio to a level higher than 1, we
consider the ratio in terms of three factors: ROE, capital costs, and profit growth rate, and will
implement a three-pronged improvement plan consisting of further improving our ROE, lowering
capital costs, and sustainable profit growth.

In order to increase its ROE, the Bank aims to improve its RORA, a measure of profitability relative torisk-weighted assets, while maintaining the capital ratio at a constant level. We aim to increase
consolidated profit from ¥60.2 billion to ¥75.0 billion and RORA from 0.75% to 0.83% over the three
years of the Mid-Term Plan by allocating resources to various fields in existing businesses and digital/
new businesses.

Perspective on the P/B ratio*2＝

P/B ratio

ROE

×

＝

PER

÷

Cost of shareholders’ equity – profit growth rate

ROE* 6.38%(TSE standard) 5.68%

Resource allocation

P/B ratio improvement measures

Capital costs*3

Lower

Profit growth rate

Increase

Improvement measures
Further improve ROE

Lower capital costs

Ongoing profit growth

Improve ROE by improving RORAReduce “information asymmetry” between the Bankand shareholders by expanding non-financial
disclosures and improving shareholder engagement

Consolidated profit plan (¥ billion)

6.38%

Lower 7% Around 8%
range

60.2

75.0

FY2022

FY2025100.0

FY2025

Shrinking risk premium beta

FY2030Total

Improve consulting
Improve proposal to non-borrowers

Diversified
finance menu

Branch network, sales branch terminal maintenance, etc.

Digital/new
businesses

6.9

3.5

App, portal, BaaS,
advertising, etc.

Other

3.5

8.7

Human capital, digital
infrastructure, etc.

Total

16.0 14.0

30.0

Housing loans Inheritance/trusts

Additional app,portal features

Net Loan Center

4 major investment
trust strategies

Transaction data, credit
checks using AI, etc.

Cashless

Advertising business Chibagin Market

BaaS business Metaverse business Real estate funds
Energy businessOn Ad

AML CenterSony Bank collaboration

Increase in profit from new business initiatives
RORA improvement result

FY2025Plan(consolidated)+¥1.6 billion

New businessApprox. ¥3.0 billion+0.03%

Human Capital Management

1.8

Practice general financial consulting
Assets undermanagement+¥1.4 billion

DigitalNote

Existing Businesses 5.6

Reform retail business model

Digital/new businesses(¥ billion)

Strategic
Expenses
investments

FY2030*1 Results for FY2023*2 A more accurate formula is P/B ratio = 1 + (ROE - cost of shareholders’ equity) ÷ (cost of shareholders’ equity - growth rate). The formula shown here is presented as a practical simplified version.
*3 The Bank’s administrative capital costs are estimated using CAPM.

Enhance businesssuccession, M&A

Increase in profit from fortifying existing businesses Approx. ¥12.0 billion
RORA improvement result+0.05%

370

Things/money(Based on shareholders’ equity)

FY2022

Increase market share in areas abandoned by other banks
Increase loans via new branches

People Identify 370 employees via rationalization/review ofbranch network, and allocate them to growth areas
Reorganization Number of people
Note
Head Office (planning)
55 Strengthen sales branch support structure
Head Office (sales)
85 Enhance specialists
Head Office (administration)
40 Consolidate administration of sales branches at Head OfficeGroup companies
60 Prioritize sales divisions
Sales branch 110 Branch opening, enhance RM
HR development
20 RM development, DX trainee, etc.

RetailGrowth Strategy for Value Creation

The Bank’s current P/B ratio is approx. 0.8*1.
In order to achieve a P/B ratio of 1, we will need a strategy of improving our ROE and increasing our profit growth rate while lowering capital costs.
Improve

Corporate

Profit ¥60.2 billion RORA 0.75%

If ROE >= (Cost of shareholders’ equity – profit growth rate), P/B ratio will be 1 or over.

ROE

Fortify existing businesses

FY2022 Results (consolidated)

ROE

Chiba Bank’s Value Creation

Growth Strategy

Messages

Improving our P/B Ratio

ROE* Lower 7% range

Profit ¥75.0 billion RORA 0.83%(TSE standard) Around 6%*ROE: Based on shareholders’ equity

P/B Ratio

Trends in P/B Ratio and ROE
Sustainable growth toward FY2030

P/B ratio above 1 within sightduring the current Mid-term Plan

FY2025plan

PER of 14.7
PER of 7.4

ROE of around 8%

P/B ratio of 1

Final year of Mid-term Plan
before previous Plan (FY2019)

ROE Lower 7% range
ROE 6.38%¥60.2 billion

P/B ratio of approx. 0.9(ROE of around 6%)
Final year of previous
Mid-term Plan (FY2022)¥62.4 billion

New business/digital¥3.0 billion

ROE (TSE standard)

Recoup investment in approx. 3.4 years

Strategic system investment/expenses: Approx. ¥20.0 billion over three years
Human capital investment: Approx. ¥400 million (FY2025)

Policy interest rate raised to 0.5% in September 2024
Government bond 10-year yield: 1.5%
TIBOR: (until Sept. 2024) Keep at same level as after policy interest rate rise of March 2024
(From Sept. 2024) Average interest rate of Dec. 2023 + 0.60%
Short-term prime rate +0.5% from Sept. 2024

¥100.0 billion

Rise in domestic interest rates¥75.0 billion

ROE 6.40%

Refining of existing businesses¥12.0 billion* Interest rate rise simulation

FY2019 – FY2023

Next Mid-term Plan and Beyond

Financial and Corporate Data

FY2023
P/B ratio of approx. 0.8(ROE of mid 5% range)

Current Mid-term Plan

P/B ratio of approx. 1.2(ROE of around 8%)

Management Base Supporting Value Creation

FY2025Interest rate rise simulation*

In addition to the steady execution of growth strategies by refining existing businesses and fortifying
new business and digital initiatives, we will aim for the further improvement of ROE while incorporating
the positive impacts of interest rate rises in Japan.

FY2022

FY2023

FY2024(1st year)

FY2025(2nd year)

ROE improvement
effect of interest
rate rises

Interest rate
rise simulation+0.65%+1.58%

ROE

Upper 8% range(TSE standard) Around 8%

Further strategic spending
FY2028(5th year)

FY2030(7th year)+1.56%
Achieve P/B ratio of 1.0*If FY2023 PER of
14.7 is maintained

Lower 9% range

Around 10%(TSE standard) Mid 8% range(TSE standard) Lower 9% range*All figures are on a consolidated basis

39

The Chiba Bank Integrated Report 2024

The Chiba Bank Integrated Report 2024

40

Chiba Bank’s Value Creation

Improving our P/B Ratio

Improving RORA

Shareholder returns

By adopting strategies tailored to divisions and assets, in addition to raising topline RORA, we will
work to raise bottom line RORA by bolstering fees and commissions.

We aim to achieve a dividend payout ratio of
more than 35% during the period of the Mid-term
Plan and 40% in the long term. We will flexibly
implement acquisitions of treasury shares so that
common equity Tier 1 capital ratio* remains within the required range.
We will improve earnings by steadily carryingout various measures and continue to implement
shareholder returns that take into consideration
the balance between investment for growth anda sound capital base.

Bottomline RORA

*Bubble size: Gross business profit

FY2023

Housing loans

Improve RORA & OHR
Promote portal use
Steady incorporation ofinterest rate rises

2.0%

1.0%

SMEs
IndividualReal estate
Large enterprises
business owners leasing businesses
Medium-sized companies

0.0%
40%

30%

20%

10%

OHR
*Calculations of division OHR tend to be low because they do not include Head
Office expenses, etc.
*In the calculation of RORA, risk-weighted assets were converted based on full
implementation of finalized Basel III standards.

(FY2022

FY2023)Financial product sales:
128% 138%
Cashless: 70% 70%
Trusts:75% 76%∙ Divisions that do not use
risk-weighted assets∙ Work to reduce OHR through“use of digital technologies”
and “general consulting forretail customers”

Profit RORA

Profit RORA

FY2023
FY20250.8%

FY2022

0.6%
3.0

4.0

1.3%
1.1%

FY2023
0.9%
1.0

5.0

6.0
Risk-weighted assets (¥ trillion)

FY2025

FY20222.0
Risk-weighted assets (¥ trillion)

Build up corporate
solutions pipeline

Deepen digital marketing
Expand cross-use

1.8
8.1

3.1

4.0

11

13

15

18

2020.32021.32022.32023.32024.32025.3(forecast)

Consolidated shareholder return ratio

Consolidated payout ratio (%)

12.4

13.8

13.4

Account only
Digital customers

Non-digital customers

Additional shareholder returns, etc.

11.5%

193.9%

196.1%

56.5%
41.3%

3 mega-banks *Top regional
averagebanks average*TOPIX
average*Average of top five regional banks by total assets (4 banks excluding Chiba
Bank)*TOPIX average calculated from TOPIX index including dividends*Average of other banks are simple averages calculated by the Bank

Growth investments

Targetrange

Appropriate
level

10.5%

Shareholder
returns
Capital accumulation

Target level

Chiba

9.2%

6.9%

3 mega-banks
average*Top regionalbanks average*Average of top five regional banks by total assets (4 banks excluding Chiba
Bank)*Average of other banks are simple averages calculated by the Bank

Cross-shareholdings and ratio to total capitalIn terms of cross-shareholdings, our basic policy
24.45
21.95
is to maintain cross-shareholdings on a limited
21.86
19.90
basis if a meaningful rationale for holding the
17.06
254.6
shares is recognized, such as contributing to the
232.5
211.1
203.1
Contrac201.6
development of the local economy and thetion above rise in
m
a
rk
e
t
improvement of the Bank’s corporate value
value
113.2
110.5
through the maintenance and development of
95.9
82.1
56.6
good relationships with business partners as aBook value halved in four years
regional financial institution, while reducing overall
cross-shareholdings after having sufficient2020.32021.32022.32023.32024.3
Cross-shareholdings (non-consolidated, market value) as a percentage of consolidated net assets (%)
dialogue with clients to control stockholding riskBook valueMarket value (¥ billion)
and capital efficiency, etc.
The quantitative effect of cross-shareholdings
on listed stocks is determined using indexes, etc. calculated by deducting the deemed allowance forstocks and the capital cost for holding stocks, for each client, from income from deposits and loans,service income, and dividend income, etc. The Board of Directors verifies the validity of the rationale forcross-shareholdings for each individual issue, based on the economic rationale and future prospects forthe value of the shares, taking into consideration the financial and performance details of each company.
As of March 31, 2024, the amount of cross-shareholdings on the balance sheet (market value) was
201.6 billion yen, accounting for 17.06% of total capital (consolidated net assets).
The Chiba Bank Integrated Report 2024

Financial and Corporate Data

Inorganic
investment Assetaccumulation DX
investment

1H dividend (yen)230.1%

Chiba

Account use

Profit2H dividend

5 years

14.8%

Consolidated common equity Tier 1 capital ratio*
Based on full implementation of
finalized Basel III standards

9

13

18

17

Management Base Supporting Value Creation

The Chiba Bank Integrated Report 20248

15100.0%

Cross-use*Consolidated common equity Tier 1 capital ratio excludes valuationdifferences on securities fully implemented by finalized Basel III standards

41

256.9%

Reduction of cross-shareholdings

2024.3

11

Produce use

FY2019 FY2022 FY2023 FY2025(Plan)

11.87%

10

24

Annualaverage

Capital Policy

Our basic policy is to control the consolidated
common equity Tier 1 capital ratio* in the rangeof 10.5% to 11.5%. We will first use the capital
accumulated through periodic profit to invest in
growth, secure equity capital commensuratewith growth investments, maintain appropriate
capital, and then consider returning any surplus
to shareholders. We will seek to improve ROE
by improving RORA while maintaining anappropriate level of capital.

18

28[5 years from March 2019 to March 2024](¥ billion)

2.8

36

32

29.9
20

Dividend growth rate (dividend amount per share)

Non-financial
Financial*Due to full fledging of JCB business, only cashless figures are consolidated.
All other figures are non-consolidated figures.

Capital management viewpoint

Total shareholder return (TSR)[5 years from March 2019 to March 2024]

Strengthening of fees
and commissions

15.7 16.6 17.5

37.6

36.9

1.5

Strengthening of fees
and commissions

10.0

28.1

33.9

32.6

Human Capital Management

OHR of other retail operations

1.5%

29.9

Growth Strategy for Value Creation

Gross business profit RORA

3.0%
FY2022

1.0%

Improve RORA & OHR
Promote app use
Promote cross-use
Steady incorporation ofinterest rate rises

Retail Division RORA

41.7

52.9

Chiba Bank’s Value Creation

4.0%

Unsecured loans

Corporate Division RORA

50.3

48.6

Messages

Topline RORA and OHR by Asset and Division (based on FY2023)

Shareholder returns

42