YMFG Business Situation
Summary of Business Results

our region, maintaining an awareness closely attuned tobusinesses. We strive to be a company that adds value toThe Regional Economy

the region.”In the fiscal year ended March 31, 2020, the Japanese

In international operations, in May 2019 the three

economy was on a path of modest recovery. Toward theGroup banks held the YMFG Overseas Business Seminar,

end of the fiscal year, however, conditions worsened

introducing the topics of “exchange rate market trends”

significantly due to the impact of the novel coronavirus

and “effective overseas development to address issues

disease (COVID-19) pandemic. Exports and production

facing corporate management.” Furthermore, inweakened. The employment situation, which had been

September 2019 the three Group banks held the 2019improving, was also affected, which in turn led to weaker

Liaoning Province China–Japan Business Meeting inpersonal consumption.

Dalian, in China’s Liaoning Province. The meeting was

The regional economy enjoyed a slight recovery, but

held in conjunction with the Hokuhoku Financial Groupgrowing uncertainty toward the end of the fiscal year(Hokuriku Bank and Hokkaido Bank) and the Department

brought the economy to a standstill. Bolstered by robustof Commerce of Liaoning Province. To promote overseas

domestic and overseas demand, production activity wasexpansion, we will continue to support businessgenerally firm. In the second half, however, production

development in Asia by reinforcing our Asian network.

levels for export machinery and other items fell off as aresult of the COVID-19 pandemic. Personal consumption

Financial Results

weakened in the second half of the year, as demand fell

On a consolidated basis, total income rose ¥12,830 million

back following a surge ahead of the consumption tax

year on year, to ¥175,423 million, due to higher gains on

hike. Meanwhile, the manufacturing sector continued tothe sale of Japanese government bonds and gains on thedrive increases in capital investment, as major chemicalsale of shares. Total expenses expanded ¥9,789 million,manufacturers invested to boost production capacity.

to ¥139,065 million, mainly because of losses on theAgainst this backdrop, from the perspective of regionalredemption of Japanese government bonds and higher

invigoration and in line with their mission of contributing

credit costs. As a result, income before income taxes

to regional economic development, regional financial

rose ¥3,041 million, to ¥36,358 million, and net income

institutions face requests to deliver stronger financial

attributable to owners of the parent grew ¥2,242 million,

soundness and profitability, supply funding more flexibly

to ¥25,391 million.

and further enhance their financial services.

Deposit amounted to ¥9,525.9 billion, up ¥295.1 billion,due to efforts to enhance products and services to meet

YMFG Performance
Amid these financial and economic conditions, supported

Loans and bills discounted increased ¥244.2 billion,

by its shareholders and business partners all YMFG’sto ¥7,652.6 billion as of March 31, 2020, due to due to

officers and employees were united in their efforts tothe Group’s efforts to fulfill its role as a regional financial

strengthen the Group’s management base, bolster

institution through its function as a financial intermediary

operating performance and contribute to the region.

and aggressive efforts to meet demand from business

During the year, we launched the YMFG Medium-partners with whom the Group has developed trust-Term Management Plan 2019. We strove to realize the19

increasingly diverse customer needs.

based relationships.

goals of this plan, namely: “We aim to go beyond theThe Group’s holdings of securities came to ¥1,512.7

boundaries of finance to address the social issues facing

billion at year-end, up ¥114.7 billion, due to increases inYMFG Annual Report 2020

Japanese national and regional government bonds. Thisconsolidated common equity Tier I capital adequacy ratiochange reflected investment decisions based on a polity of

was 12.41%.
Net cash provided by operating activities was ¥134.1

enhancing profitability for each fiscal year and across thebillion, a ¥381.9 billion difference from the previous year,overall portfolio.
Total assets amounted to ¥10,605.4 billion at fiscal

mainly due to the rise in negotiable certificates of deposit.

year-end, up ¥301.3 billion from one year earlier. This

Net cash used in investing activities was ¥165.8 billion, aincrease was the result of growth in loans and greater¥505.5 billion difference from the previous year, and theholdings of securities.

result of purchases of securities. Net cash used in financing

Net assets came to ¥630.2 billion, down ¥30.7 billion

activities was ¥39.1 billion, ¥5.4 billion more than in thefrom a year earlier. The decline was due to a ¥36.0 billion

previous fiscal year, due to the redemption of bonds withdrop in unrealized gains on available-for-sale securities,

subscription rights to shares. As a result of these cash

despite a ¥19.6 billion contribution due to higher profit.

flows, cash and cash equivalents at the end of the fiscal
year came to ¥944.8 billion, down ¥70.8 billion.

At the end of the fiscal year, the consolidated capital
adequacy ratio for the Yamaguchi Financial Group (uniforminternational standard) was 12.62%. Our consolidated
total Tier 1 capital adequacy ratio was 12.44% and ourYamaguchi Financial Group, Inc., Management Indices (Consolidated)
Millions of yen
2020

Millions of yen
2019Millions of yen
2018

Millions of yen
2017

Thousands ofU.S. dollars*12020

Consolidated total income

175,423

162,593

162,072

163,818

1,611,899

Consolidated net income attributable to owners of
the parent

25,391

23,14932,91731,587233,308

Consolidated comprehensive income(25,204)652

47,26937,676(231,591)

Consolidated total net assets

630,245

660,958

660,451

617,053

5,791,096

10,605,416

10,304,140

10,366,548

10,225,782

97,449,380

2,458.73
yen

2,580.74
yen2,653.60
yen2,486.35
yen

22.59
U.S. dollars

Current term net income per share

100.07
yen

94.65
yen

133.65yen

128.70yen

0.92
U.S. dollars

Current term net income per share (diluted)

93.86
yen

83.27
yen

111.22yen

106.64yen

0.86
U.S. dollars

12.62%

13.62%

13.29%

13.91%

Consolidated total assets
Net assets per share

Capital ratio*2
Earnings on equity - increase
Group price earnings ratio

3.97%

3.53%

5.20%

5.31%

6.11 times

9.91 times

9.63 times

9.37 times*1 US dollar amounts have been translated, for convenience only, at the rate of ¥108.83 = US$1.00 as of March 31, 2020.
*2 YMFG calculated its capital ratio according to the uniform international standard (Basel 3).

YMFG Annual Report 202020