Our Shared Vision

The Group’s Materialities

Materialities (Priority Issues)
Besides focusing on our core business of providing financial services to support our regional customers, theNanto Bank Group’s Board of Directors discusses sustainability issues that must be addressed globally andthe wide-ranging challenges facing local communities. It has now identified the following materialities to beprioritized along with specific themes to be addressed in consideration of their importance to our Group and its
stakeholders. The contents of the list will be revised periodically to reflect changes in the business environment.

Risks ( Most threatening risks; Threatening risks)
Opportunities ( : Most promising opportunities, : Promising opportunities)

External
Nara prefecture’s
environment surrounding environment

Risks and opportunities of concern for the GroupRisks

EEnvironment

Global warming
Abundant forest
resources eterioration of customers’ business performance due to damage to their business infrastructureD
resulting from natural disasters spawned in large part by climate change Higher credit costs due to impacts on customers' business and financial conditions of regulatory tightening, technologicalinnovation, and market changes in support of decarbonization
 Higher credit costs due to damages that have reduced the value of customers’ real estate collateral

Risks
Slow economic growth
Accelerated transition todigital operations
Declining working-age
population, falling birthrate andaging population
Diversified lifestyles

SSocietyIncreased numbers of non-performing loans and credit-related expenses due to deterioration ofcustomers’ business conditions induced by domestic and international economic trends, foreignexchange rates and related factors
Increased numbers of business closures precipitated by a lack of successors and a resulting
decline in demand for funds
 Changes in existing business and industrial structures

Risks

High ratio ofowner-occupiedhouses hanges in banking transactions in response to lifestyle changes and diversification and expansion
Cof the digital native population

Wealth of
tourism
resources Growing concern about retirement savings accompanying the contraction of the working-age population and aging of thepopulation

Increased job mobility
Risks
Dissemination ofwork-style changes
Progress in diversification

Organizational rigidity stemming from staff homogeneity and uniformity of thinking Insufficient staff motivation and outflow of human resources due to delayed development of career paths that match
individual staff members’ work styles.

Risks
Changes in laws and regulations

GGovernance

Increased geopolitical risks

14 Nanto Report 2023, the integrated report of Nanto BankL oss of public trust due to leakage of customer information and system failures caused by more
complex and sneakier cyber attacks
Increased difficulty of risk management due to a highly uncertain business environment Decreased asset value attributable to deterioration of loan customers’ financial condition, etc.
 Decreased asset value attributable to fluctuations in interest rates, exchange rates, stock prices, etc.

About Nanto Bank

Our Shared Vision

Developing Human
Value Creation by theGovernance Supporting Our Consolidated Financial
Resources for Value Creation Group’s Human Resources Proactive Human ResourcesStatements

Organizational
overview and external
environment

Businessmodel

Risks andopportunities

Strategies
and resources
allocation

Materiality determination process
STEP

1

STEP

Identification of issues

2In addition to the issues determined by international frameworks, including theUnited Nations Global Compact, ISO 26000, the Global Reporting Initiative, andthe SDGs, the Group identified an extensive range of environmental, social, andgovernance issues expected to arise in the future. Our basic sustainability policy
is developed in consideration of the Group’s operating environment with reference
to the Global Top 10 Risks announced by the World Economic Forum and theJapanese government’s SDGs Action Plan.

Analysis and evaluationof identified issues

STEP3

Identification of mostsignificant issues

Based on the results of Step 2,
the Management Committee and
Board of Directors identified thematerialities after discussing theopportunities, risks, and matters tobe prioritized.

Among the foregoing, we then identified
issues that are of particular relevanceto the Nanto Bank Group and analyzed
and evaluated their importance fromtwo perspectives: their impact on ourstakeholders and their financial impact on
our Group.

Review in response to changes in the external environment

Materialities (Priority Issues)
Opportunities

Increased demand for environment-related businesses and other activities aimed at decarbonization
Cultivation of regional environmental awareness through proactive environmental conservation efforts

Responding to the Effectsof Accelerating Climate
Change Increased demand for funds for investment in disaster prevention infrastructure Growing need for protection against wind and/or flood disasters and other environmental changes, and resulting
opportunities to provide insurance and other financial products and services to support environmental protection
measures in preparation for disasters

Opportunities

Increased customer demand for non-financial services, including M&A, asset succession, andemployee placement services
Increased number of business opportunities benefiting from the region’s wealth of tourism resources

Realizing Sustainable
Growth of Our Regional
Economy Increased number of business opportunities stemming from new job creation in cooperation with local governments
and other external organizations Increased demand for funds to support customers’ cash management and core businesses, and greater number ofopportunities to provide new services
Opportunities

 rowing demand for asset-building services from members of the younger generationGIncreased opportunities to provide services that meet customers’ need for inheritance services anddiversifying bequest and donation needs
Steady demand for products and services responding to homeowners’ growing needs

Realizing a Convenient,
Prosperous Society

Fiscal 2023
Action Plan

Increased opportunities for provision of new products and services employing digital technologies

Opportunities

E xpansion of the business territory through acquisition of highly specialized IT, risk management, andother personnel
Provision of high value-added services through utilization of diverse human resources

Cultivating a Healthy Corporate
Culture with Participation ofDiverse Human Resources

Provision of greater opportunities for women with potential for social advancement

Opportunities

Improved awareness of investors’ needs obtained by creating more opportunities for constructive
dialogue with shareholders and investors

Preparing for Increasingly
Varied and Complex Risks

Nanto Report 2023, the integrated report of Nanto Bank15