This is the preliminary translation of the Japanese version Lawson Bank financial results provided by Lawson, Inc.

Financial Summaryfor the First Half of Fiscal Year 2019 Ended September 30, 2019
November 13, 2019
Lawson Bank, Inc. (https://www.lawsonbank.jp/)
I.

Financial Results Highlights(Financial figures are truncated to the unit stated)

1.

Results of Operation (Non-consolidated)

Total revenue
Net interest income
Net fees and commissions
Net provision of generalreserve for loan losses
General and administrativeexpenses
Ordinary business profits
Ordinary profits
Net income
2.

(Millions of Yen)1H FY2019 (6 months)
13,144-554
13,699

1-1

6,933
529
520
303

12,104
1,041
1,232
1,080

Balance Sheets (Non-consolidated)

Cash and due from banks
Loans
Other assets
Total assets
Deposits
Call money
Borrowed money
Other liabilities
Total liabilities
Total equity
3.

1H FY2018 (6 months)
7,463-128
7,592

FY2018(As of March 31, 2019)319,744065,919385,664
14,840280,000
69,671
364,512
21,151(Millions of Yen)
1H FY2019(As of September 30, 2019)
325,955
16
56,694
382,666
12,4495,000
310,000
32,984360,433
22,232

1H FY2018 (6 months)
92.9%

1H FY2019 (6 months)
92.1%

FY2018(As of March 31, 2019)
72,6847,362
10.13%(Millions of Yen)
1H FY2019(As of September 30, 2019)79,2668,643
10.90%

Financial Ratios (Non-consolidated)
Expense-to-revenue ratio

Risk-weighted assets
Core capital
Capital adequacy ratio

1

FY2018(As of March 31, 2019)
Number of ATM units installed

13,476

Total number of banking
accounts

28,177

1H FY2018 (6 months)
Total number of ATM usage(1,000s)
Average daily ATM usage (no.
of times per day per unit)

1H FY2019(As of September 30, 2019)13,50140,366

1H FY2019 (6 months)

79,698

119,774

49.8

48.4

Note:
1. In FY2018, figures are from operations after June 1, 2018 when the absorption-type split of Lawson ATMNetworks, Inc. was implemented.
2. Figures of total number of ATM usage are rounded off a number less than 1,000.
3. Figures of average daily ATM usage are rounded off to one decimal places.

FY2018(As of March 31, 2019)
Number of affiliated financial
institutions (banks, companies,depositories)

113

1H FY2019(As of September 30, 2019)118

Note: The JA Bank and JF Marine Bank are considered each as an institution depending on business categories.

2

II.

Interim Financial Statements
1. Interim Balance Sheets (Non-consolidated)(Financial figures are truncated to the unit stated)(Millions of Yen)FY20181H FY2019(As of March 31, 2019)(As of September 30, 2019)[Assets]
Cash and due from banks
Cash
Due from banks
Loans
Overdraft
Suspense payments in ATMs
Other assets
Prepaid expenses
Accrued income
Other assets
Guarantee deposits forCCP
Tangible fixed assets
BuildingsLeased assets
Other tangible assets
Intangible fixed assets
Software
Software in progress
Reserve for loan losses
Total assets[Liabilities]
Deposits
Ordinary deposits
Time deposits
Other deposits
Call money
Borrowed money
Suspense receipts of ATM
Other liabilities
Income taxes payable
Accrued expenses
Lease obligations
Other liabilities
Accrued employees’ bonuses
Total liabilities

3319,744
281,405
38,3380025,519
9,731
900
250
8,579
5,000

325,955
314,779
11,17516
16
14,852
10,056
763
0
9,292
5,000

16,879170
16,548160
13,793
13,626166-3385,664

18,196151
17,894150
13,59012,765824-1382,666

14,84014,600238
2280,000
55,818
13,681328
1,752
11,186413
172364,512

12,44910,419
2,024
5
5,000
310,000
18,405
14,386204
1,454
11,862865
191
360,433

FY2018(As of March 31, 2019)[Equity]Common stock
Capital surplus
Capital reserve
Retained earnings
Legal reserve
Other retained earnings
Unappropriated retainedearnings
Total shareholders’ equity
Total equity
Total liabilities and equity

4(Millions of Yen)
1H FY2019(As of September 30, 2019)

11,60011,60011,600-2,048-2,048-2,048

11,60011,60011,600
-967
-967
-967

21,151
21,151
385,664

22,232
22,232
382,666

2.

Interim Statement of Income (Non-consolidated)(Financial figures are truncated to the unit stated)(Millions of Yen)
1H FY2018
1H FY2019(From April 1, 2018 to(From April 1, 2019 to
September 30, 2018)
September 30, 2019)
Ordinary income
Interest income
Interest on loans anddiscounts
Interest and dividends on
securities
Interest on call loans
Interest income on due frombanks
Other interest received
Fees and commissions income
Exchange fees received
ATM commissions received
Other business income
Other ordinary income
Reversal of reserve for loan
lossesOther ordinary income
Ordinary Expenses
Interest expenses
Interest on deposits
Interest on call money
Interest on borrowed money
Other interest paid
Fees and commissions
expenses
Exchange fees paid
ATM installationcommissions expenses
ATM commissions expenses
Other business expenses
General and administrative
expenses
Other ordinary expenses
Provision of reserve for loan
lossesOther ordinary expenses
Ordinary profit

59,8670-

17,577-1200-

0-4-109,864
9,864
3-

2
17,3284
17,284
39
260
13
9,347
128
0
5
122
2,272

258
16,345
542
0
2
340
199
3,629

0
1,059

1
1,602

1,212
6,933

1,945
80
12,104

13
168-

12520

68
1,232

Extraordinary profits
Extraordinary losses
Tangible fixed asset disposal
expenses
Other extraordinary losses
Net income before income taxes
Income taxes
Income taxes
Deferred income taxes
Net income

1H FY2018(From April 1, 2018 toSeptember 30, 2018)
2
2518
214
210
4303

6

(Millions of Yen)
1H FY2019(From April 1, 2019 toSeptember 30, 2019)
0504
1,227
147
147
1,080

3.

Interim Statement of Changes in Equity

1H FY2018 (From April 1, 2018 to September 30, 2018)(Financial figures are truncated to the unit stated)(Millions of Yen)
Valuation and translation
adjustments

Shareholders’ equity
Capitalsurplus
Commonstock

Balance of
beginning of500
periodChange during
interim period
Increase incapital andcapital
11,100reserves
Net income
Net change
during interim
period foritems otherthanshareholders’equityTotal change ininterim period 11,100
Balance,
September 30,
11,6002018

Retainedearnings
Otherretained
earnings
Deferedretainedearnings

Total
shareholders’ equity

500-2,054-1,054---1,054

11,100-303

22,200303--

22,200
303

-

--

00

0

11,100303

22,50300

22,503

11,600-1,75021,44900

21,449

Capitalreserves

7

Unrealized gain Total valuation Total equity(loss) on other and translation
adjustments
available-forsale securities

1H FY2019 (From April 1, 2019 to September 30, 2019)(Financial figures are truncated to the unit stated)(Millions of Yen)
Valuation and translation
adjustments

Shareholders’ equityCapitalsurplus
Commonstock

Balance of
beginning of
11,600periodChange during
interim period
Increase incapital andcapitalreserves
Net income
Net change
during interimperiod foritems otherthan
shareholders’equityTotal change ininterim period
Balance,
September 30,11,600
2019

Retainedearnings
Otherretainedearnings
Deferedretainedearnings

Total
shareholders’ equity

11,600-2,04821,151--

21,151

-

1,080

1,080

-

-

1,080

-

-

-

----

1,080

1,080

-

-

1,080

11,600-967

22,232--

22,232

Capitalreserves

8

Unrealized gain Total valuation Total equity(loss) on other and translation
adjustments
available-forsale securities

4.

Interim Cash Flow Statement (Non-consolidated)(Financial figures are truncated to the unit stated)(Millions of Yen)
1H FY2018
1H FY2019(From April 1, 2018 to (From April 1, 2019 to
September 30, 2018) September 30, 2019)
I Cash flows from operating activities
Income (loss) before income taxes

518

1,227

1,341

3,154

1-1

52

18-77-457

0-12128542

Net change in stored items (-)-16

Net change in unsettled money forATMs (-)
Net change in accounts payable (-)--26,744

238

397

Net change in deposits (-)

936-3,005012-131-542

Depreciation
Net change in provision of reserve
for loan losses (-)
Net change in accrued employees’
bonuses (-)
Net change in operatingreceivables (-)
Interest income
Interest expenses

Interest received
Interest paid
Losses (gains) on disposal of fixedassets
Net change in borrowed money (-)

2-

138,200

35,000

Repayment of lease obligations-1,671-2,862Other-674

328

Sub total

138,8627,701-3-350538

504

139,397

7,225-5,507-Purchase of tangible fixed assets

-75

-5

Purchase of intangible fixed assets-3,795-1,009Net cash provided by (used in)investing activities
III Cash flow from financing activities-9,378-1,041

Cash flow from financing activities----

Payment of corporate taxes, etc.
Refund of sales tax, etc.
Net cash generated by operatingactivities
II Cash flow from investing activities
Purchase of securities

IV Adjustments on cash and cash
equivalents

91H FY2018(From April 1, 2018 toSeptember 30, 2018)
V Net change in cash and cash
equivalentsVI Cash and cash equivalents at
beginning of interim period
VII Net change in cash and cash
equivalents relating to absorptiontype company split
VIII Cash and cash equivalents at
end of interim period

10(Millions of Yen)
1H FY2019(From April 1, 2019 toSeptember 30, 2019)

130,020

6,211

2,120

319,744723-

132,863

325,955

III. Reference Information(Financial figures are truncated to the unit stated)
1.

Capital Adequacy Raito Information

Risk-weighted assets
Core capital
Capital adequacy ratio
2.

(Millions of Yen)
1H FY2019(As of September 30, 2019)79,2668,643
10.90%FY2018(As of March 31, 2019)
72,6847,362
10.13%

Claims Classified under the Financial Revitalization Law (Non-consolidated)(Millions of Yen)
1H FY2019(As of September 30, 2019)

FY2018(As of March 31, 2019)
Claims against bankrupt andquasi-bankrupt obligors-

0

Doubtful claims--

Substandard claims--

25,52015,143

Normal claims
3.

Derivative Transaction
None.

4.

ATM Transactions
FY2018(As of March 31, 2019)
Number of ATM units installed

13,476

1H FY2018 (6 months)
Total number of ATM usage(1,000s)
Average daily ATM usage (no.
of times per day per unit)

1H FY2019(As of September 30, 2019)13,501

1H FY2019 (6 months)

79,698

119,774

49.8

48.4

Note:
1. In FY2018, figures are from operations after June 1, 2018 when the absorption-type split of Lawson ATM
Networks, Inc. was implemented.
2. Figures of total number of ATM usage are rounded off a number less than 1,000.
3. Figures of average daily ATM usage are rounded off to one decimal places.

FY2018(As of March 31, 2019)
Number of affiliated financial
institutions (banks, companies,depositories)

113

1H FY2019(As of September 30, 2019)118

Note: The JA Bank and JF Marine Bank are considered each as an institution depending on business categories.

11

5.

Other
1H FY2018 (6 months)
Interest margin for total fund6.

1H FY2019 (6 months)-111.64%

General and Administrative Expenses
1H FY2018 (6 months)
Personnel expenses

677

Non-personnel expenses
Depreciation
Taxes
General and administrativeexpenses
7.

-6.30%(Millions of Yen)
1H FY2019 (6 months)
862

6,161

11,125

1,341

3,154

94

116

6,933

12,104

Number of Directors, Auditors, and Employees
FY2018(As of March 31, 2019)

1H FY2019(As of September 30, 2019)
9Directors and auditors

11Directors

75Auditors

44Employees

139

150

Total

150

159

Notes:
1. The number of directors and auditors includes external directors and auditors.
2. The number of employees includes executive officers and transferred employees, but not loaned workers, butnot temporary employees.

12