Performance Highlights (YMFG)
Performance during the fiscal year ended March 31, 2016
Business Profits from Core Operations/
Ordinary Profits/Net Income (Three Banks)

Capital Adequacy Ratio (YMFG)
YMFG’s consolidated capital adequacy ratio (uniform

Business profits from core operations decreased ¥5.3 billion

international standard) under Basel III was 13.37%. The totalyear on year, to ¥28.4 billion. This outcome stemmed fromTier 1 capital adequacy ratio was 12.72%, and consolidated

lower interest income compared with the previous fiscal year.

common equity Tier I capital adequacy ratio was 12.72%.

Ordinary profits increased ¥3.6 billion, to ¥53.4 billion, andnet income attributable to owners of the parent amounted to¥37.0 billion.

14

Business Profits from Core Operations
Ordinary Profits
Net income Attributable to Owners of the Parent
50.0

53.4

49.8

(%)

13.43

13.37

12.69

13

(Billions of yen)

60
50

Capital Adequacy Ratio
Tier I Ratio

12.72

1211.731111.10

10

40
30

33.1

30.5

37.0

33.7

32.1

928.4

2014

2015

2016
(Basel III)20

Capital Strategy (Euro-dollar convertible bonds
issued and Repurchase own shares)

100201420152016

Euro-dollar convertible bonds issued (Mar. 2015)

Non-Performing Assets Based on the Financial
Revitalization Law (Three Banks)
Doubtful Assets
Bankrupt and Quasi-Bankrupt Assets
Sub-Standard Loans
Non-Performing Loan Ratio

Amount
Coupon

Maturity$300 million
5 years
Three-month U.S. dollar LIBOR -0.5% (however,with 0% as minimum)Objective

To meet the growing needs of the Group’s corporate(Billions of yen)(%)

customers as they move into overseas markets and expand their250

2.5businesses and transactions overseas, YMFG aims to augment

200YMFG
1.62 2.0

2.31

1.84
1.62

150

118.0
54.7

100

47.0

42.8

22.9
2014

2015

55.1

50.3

16.0

12.8
2016

convertible bonds to facilitate stable U.S. dollar fundraising.
By attaching contingent conversion and call conditions, we
aim to restrain convertibility to common stock, thereby providing

105.9

63.4

500

YMFG
1.5
106.0

140.9

its foreign-denominated lending. We have issued these

1.00.5a debt product that gives ample consideration to existing
shareholders. Rather than being zero-coupon, the bonds have avariable interest rate to further restrain potential dilution.

0.0

Purchase of treasury stock (Mar. 2015)
Amount

10 million shares

Objective

To offset the impact of dilution by raising capital efficiency.
Diagram of scheme(Before)Debt(CB issued)(Repurchase own shares)

Debt

Debt

CB

CB
Capital Adequacy
Ratio is still high.
(13.37%)
CapitalCapitalCapitalRepurchase own shares

Lowering funding cost of U.S.$ with minimizing dilution shareholder value

9YMFG Annual Report 2016

Ratings for YMFG, Yamaguchi Bank andMomiji Bank

Deposit Balance (Three Banks)

Ratings for the Group companies were A (stable) for YMFG,A+ (stable) for Yamaguchi Bank and Momiji Bank.

¥9,526.1 billion including Negotiable Certificates of Deposit

The total deposit balance at term-end was ¥8,714.4 billion, or(NCDs). This came about because of the expansion of products
and services and steady marketing efforts based on solidcommunity relationships.

AAARating and Investment Information, Inc.

AA

(As of August 10, 2015)

A

YMFG

BBB

10,000

Yamaguchi BankB

A+ (stable)

CCC

9,295.2

9,526.12015

2016

6,000

A+ (stable)

C8,809.48,000

Momiji BankCC(Billions of yen)

12,000A (stable)

BB

Deposit Balance (Three Banks)

4,000
2,00002014

Note: The deposit balance includes the NCD balance.

Balance of Loans/Balance of Personal Loans (Three Banks)
The balance of loans at term-end was ¥6,471.5 billion, as a result of active efforts to live up to the trust placed in us by ourcustomers by meeting healthy demand for funds.
Balance of Loans
Balance of Loans in Japan
Balance of Loans to Small and Medium-Sized Businesses(Billions of yen)

8,000
6,000

6,032.2

6,290.4

6,437.1

3,652.0
58.1%

3,755.1
58.3%(Billions of yen)
1,500

6,471.5

6,326.0

6,003.2

Balance of Personal Loans

1,200

1,078.6
18.0%

900
4,000

3,520.6
58.6%

1,209.918.7%

600

2,00001,136.5
18.1%

300
2014

2015

02016

2014

2015

2016

Note: The percentages of loans to small and medium-sized businesses and personal loans are calculated on the basis of the balance of loans in Japan.

Dividend Policy (YMFG)

Expected Performance for the Fiscal YearEnding March 31, 2017 (YMFG)We have continued to provide stable dividends to ourshareholders while securing profits and reinforcing financial

YMFG aims to achieve its consolidated ordinary profits ofhealth to maintain our credit strength.

¥50.0 billion and net income attributable to owners of theIn the year ended March 31, 2016, the dividend per shareparent of ¥33.0 billion.

at term-end was ¥8. Combined with the interim dividend of ¥7
per share, the full-year dividend amounted to ¥15 per share.
FY2013

FY2014FY2015(Yen)
FY2016(Forecast)

Annual dividend per share
13.0(Interim dividend) (6.0)

14.0
(7.0)

15.0(7.0)

18.0(10.0)YMFG Annual Report 201610