Integrated Report Main Part

2018

Mission

Design the Futurewith Financial ExpertiseContinue to expand financial frontiers;
Provide the best solutions for customers and society;Pursue sustainable development for Japan and the world.

Editorial Policy
DBJ Group published its first report for increasing communication with stakeholders in fiscal 2003, Environmental Reportfor a Sustainable Society. This integrated report is intended
to provide financial and non-financial information to explain
DBJ Group’s business activities and initiatives in sustainablevalue creation to our broad spectrum of stakeholders. The
content is decided by the Management Committee.
Period Covered and Scope
Period: Fiscal 2017 (April 1, 2017–March 31, 2018)(Some information from outside this period is also included.)
Scope: In principle, the report covers DBJ and its 11 main
subsidiaries.

Guidelines and Entities Referenced	International Integrated Reporting Council (IIRC)
International Integrated Reporting Framework
Guidance for Integrated Corporate Disclosure andCompany-Investor Dialogues for Collaborative
Value Creation

Date of Publication
September 2018

Disclaimer
Integrated Report 2018 contains forward-looking statements. Forwardlooking statements are based on information available at the time ofwriting and hypotheses or judgments regarding uncertain factors.
Accordingly, actual results may differ materially if conditions change.

https://www.dbj.jp/en/
Latest news, financial services, case studies for investment, loans, various reports, information for investors, and details about CSR initiatives
Note: Detailed information in the main part can also be found on the DBJ corporate website.

Contents
DBJ Group’s Vision
2 Message from the President
6 DBJ Group’s Corporate Philosophy
8 Our History
10	Three Priority Areas for Realizing
a Sustainable Society

12 Sustainability Management
14	Fourth Medium-Term Management Plan
16	Financial Market Activation andStabilization Resulting from Cooperation
and Collaboration under the Fourth
Medium-Term Management Plan

DBJ Group’s Strategy
Business Strategy

18

Sector Strategy

28

Area Strategy

34

Function Strategy

Management Foundation Strategy

42

Financial Capital46

Human Capital

50Intellectual Capital

52

Relationship and Social Capital

Corporate Governance
54 Message from the Chairman
56 Corporate Governance
62	Directors, Audit & Supervisory Board
Members, and Executive Officers

Risk Management
64 Risk Management System
Corporate Data
68 Timeline
69 Shareholder		Summary of Changes to the
DBJ Act after Conversion toa Joint-Stock Company

71	Corporate Information /Group Companies

Data Section
The Development Bank of Japan Inc. Act,
Financial Condition
Note: Not included in the main part. See the integrated edition.

Integrated Report 20181

Message from the President

As a top runner in sustainability
management, we promotea sustainable society driven by both
economic and social value.

Hajime Watanabe
President and CEO
Development Bank of Japan Inc.

2

Integrated Report 2018

In 2015, we gave fresh thought to the role DBJ should play leading up to 2030. In the course of ourdebate, we identified a number of changes in the external environment which have a significant impact
on DBJ Group stakeholders: Japan’s declining population and its climate and energy issues; intensifying
global competition; and technological innovations such as AI and fintech. Since its founding during thepostwar reconstruction period, DBJ Group has dealt with issues ranging from urbanization and pollution
control, up through the period of high economic growth, to the challenges of crisis management andcompetitiveness building we are working on today. Based on the roles the Group has undertaken and thevalue it has realized over this time, we tried to identify the best areas in which to use our strengths overthe longer term in the interests of a sustainable society.
The result was Vision 2030. Drawn up in 2017, it establishes infrastructure, industry, and regional economies as the three priority areas (materiality items) for DBJ Group initiatives (see page 10). Our contributions in these areas will be consistent with the Group’s course so far, and we believe they will be in linewith what society and stakeholders expect from us in the future. The Group will do its utmost to promotesustainable development in these fields.

Integrated Report 20183

Corporate Data

3. The Long-Term Vision 2030 and Priority Areas

Risk Management

Since the days of its predecessors, the Japan Development Bank and the Hokkaido-Tohoku Development
Finance Public Corporation, DBJ Group has contributed to Japan’s sustainable development. It has achieved
this by responding flexibly to the issues of the day, through the periods of postwar reconstruction and highand stable growth, the bubble economy and its collapse, globalization, declining birth rates and aging
population, and growing environmental and disaster awareness. The past decade alone has seen dramaticchange in the wake of the global financial crisis and such major events as the Great East Japan Earthquake.
DBJ Group has developed new initiatives with an eye on the future, made possible by steady dialogue withour clients and other stakeholders. This dialogue we regard as a precious asset.
In October 2018, DBJ Group will mark its 10th anniversary as a joint-stock company. Going forward, we
will continue to focus on flexibly responding to the changing needs of our clients and society as a whole,in keeping with our mission of “designing the future with financial expertise” while maintaining the corevalues of initiative and integrity.

Corporate Governance2. The Role of DBJ GroupDBJ Group’s Strategy

Political instability is increasing today against a global backdrop of emerging protectionism and growing
geopolitical risk. The environment surrounding financial institutions is also changing rapidly amid tightened
financial regulations across the globe, rapid innovation in fintech, and negative interest rates in Japan.
In a world of rising uncertainty, a heightened awareness of the role of finance in building a sustainable
society has produced marked change in the environmental, social, and governance (ESG) movement.
In June 2017 the Task Force on Climate-related Financial Disclosures, formed under the auspices of the
Financial Stability Board (FSB), published its final recommendations. In Japan, corporate leadership in working towards the United Nations’ Sustainable Development Goals (SDGs) has been a powerful motivating
force, along with the ESG investment initiatives of the Government Pension Investment Fund (GPIF).
As countries across the world set forth shared goals for sustainable development and the world looks
to private companies for solutions to social issues, increasing numbers of companies are making suchinitiatives an integral part of their business.

DBJ Group’s Vision

1. Foreword

Message from the President

We will approach the creation of value centered on these three areas through sustainability management. By this we mean the creation of both economic and social value through our business activities
with the aim of realizing a sustainable society. Based on its unique business model, DBJ Group will work
to enhance both its financial and non-financial value, pursuing dialogue with our stakeholders so as toimprove the value creation process.

4. I nitiatives under the Fourth Medium-Term Management
Plan (Fiscal 2017–Fiscal 2019)
The Fourth Medium-Term Management Plan: Initiate Change, Create the Future was drawn up in 2017by backcasting from the Group’s long-term vision. It focuses on contributing to Japan’s growth by supplying risk capital to new growth sectors and regions, particularly in the vision’s three priority areas, and on
creating diverse financing and investment opportunities by linking up and collaborating with other financial institutions.
In fiscal 2017, the first year of the plan, progress was made in investment in infrastructure. Industry
initiatives were put forth in aerospace, telecommunications, and healthcare, which we see as sources ofnext-generation growth. Special Investment Operations (see page 34) allowed us to exercise creativity
and originality in drawing up region-specific projects such as alliances between regional and overseas
companies. I believe the Group’s efforts to work as one in pursuing these initiatives also marked a significant advance.

5. Our Company Going Forward
Fiscal 2018 marks the halfway point in the Fourth Medium-Term Management Plan. In Future Investment
Strategy 2018, published in July 2018, the Japanese government presents the concept of Society 5.0,
which centers on a connected society based on digital technology. The challenge for our clients today is to
move into new areas that transcend traditional established industries. In fiscal 2018 DBJ Group introduced
initiatives in the innovative logistics sector to augment its activities in aerospace, telecommunications, andhealthcare. In addition to supplying risk capital, we see our role as taking on challenges in new sectors andfunctioning as a financial hub for a diverse range of businesses.
Other areas in which we will provide support include renewable energy and urban transportation anddistribution infrastructure, essential to the creation of strong and flexible communities which draw on
next-generation technologies to promote environmental friendliness and disaster resilience. Key measures
include expanding the flow of funds throughinstruments such as real estate investment trusts(REITs) designed to satisfy demand for real estate
renewal, and public–private partnerships (PPPs)
and private finance initiatives (PFIs) for infrastructure projects dealing with tightening fiscal
constraints.
When addressing local issues as part of theseforward-looking initiatives, we will need to keep
regional characteristics in mind. Ties and collaboration with local financial institutions and otherentities will be increasingly important. And withthe rise in the ESG movement, we will be actively
promoting our DBJ certification programs (seepage 51).

4

Integrated Report 2018

DBJ Group’s Vision
DBJ Group’s Strategy

August 2018

President and CEO
Development Bank of Japan Inc.

Integrated Report 2018

5

Corporate Data

Risk Management

Sustainability management is the key to our value creation process, and human resources are its mostimportant foundation. DBJ’s officers and employees draw on our corporate DNA to pursue a balance ofeconomic and social value. They have inherited the DBJ DNA of long-term perspective, impartiality, publicmindedness, and reliability which have evolved over the years in the course of our business. Bolstered bythis DNA, the Group has always risen to meet the challenges of the times. We are constantly striving toenhance our skills in corporate and project assessment. Our expertise in long-term screening and assessment, based on a comprehensive view of regional or current issues, is equal to network building asa central Group asset.
The employees who embody the Group’s core values should be able to pursue their activities in full
health, and for this purpose we are promoting workstyle reform. In fiscal 2018 we introduced telecommuting to bring more flexibility to working patterns. Employees dealing with client and community issues needto have a good grasp of global trends, and to enhance their global perspective we offer an expanding
range of multilevel training programs including courses at universities overseas.
Dialogue with stakeholders is essential to fulfilling our mission as a top runner in sustainability management. I hope that this integrated report will serve to deepen communication among our employees,
customers, and the broader community.

Corporate Governance

6. A Top Runner in Sustainability Management

DBJ Group’s Corporate Philosophy
Design the Future with Financial ExpertiseDBJ Group updated its corporate philosophy to coincide with the unveiling of its Fourth MediumTerm Management Plan.
With due consideration paid to progress it has made thus far, projected changes in the businessenvironment, and outstanding social issues, DBJ Group has formulated a mission to relentlessly
pursue, core values to share, and its Vision 2030 to follow as a guide into the future.
In connection with these elements of its corporate philosophy, DBJ Group has identified four core
corporate values—long-term perspective, impartiality, public-mindedness, and reliability— that also
embody its strengths and areas of differentiation.

MissionVision 2030
Leveraging DBJ’s uniquestrengths to pursue its mission
and realize its vision

Business strategy
Sector strategy
Function strategy
Area strategy

Capital strategy
Sustainability
management

Values put into practicedefine our strengths

Execute strategy
based on values

Action Guideline

Values6

Integrated Report 2018

Financial capital
Human capitalIntellectual capital
Relationship and Social
capitalDBJ Group’s Vision

Sharing Our Corporate Philosophy
Further propagating and applying our corporate philosophy will improve awareness of our social
responsibility, enhance the sense of unity in DBJ Group, lower communication costs, and motivate
our employees to grow with intention and a sense of mission.

Design the Future with Financial ExpertiseContinue to expand financial frontiers;
Provide the best solutions for customers and society;Pursue sustainable development for Japan and the world.

Corporate Governance

As industry and infrastructure professionals skilled in handling
all types of risk, we will play a unique role in the economy andsociety of 2030—leading new business and market creation while
responding to crises and other social needs.

Risk Management

Our vision for 2030,
embodied in
our mission andstrategies

DBJ Group’s Strategy

Our unwavering
purpose andour incessantdetermination toshape the future

Corporate Data

Our strategy to reach our vision for 2030
Fourth Medium-Term Management Plan
DBJ’s unique strengths assist with strategy execution
Our DNAa long-term perspective, impartiality,
public-mindedness and reliability

Our guidelines fortaking specificactions that
expresses our values

Responsibility to future generations.... • We fulfill our responsibility to the future by pursuing both
economic and social value.

The customer’s perspective................... • We devote unequaled thought to each possibility—from thecustomer’s point of view.

Outstanding service............................... • We review and enhance our services while improving productivity.
Commitment and cooperation............. • We work tirelessly to broaden frontiers and achieve best results.

Our unwaveringvalues sharedby management
and employees(base component)		• We respect diversity and work together for greater shared value.

Initiative   Integrity

Integrated Report 20187

Our History
Our Mission and Values

The Japan Development Bank (JDB) and the Hokkaido-Tohoku Development Finance Public
Corporation (HTDFP), the predecessors of DBJ, were established with the objective of reviving
Japan’s economy and society after the end of World War II.
These companies contributed to the sustained development of society by providing solutions
in tune with the times, changing themselves while staying true to their core values of taking onchallenges with integrity amid significant changes in the economic and social landscape.
Economic recovery

Rapid growth

Stable growth

Economic bubble

1951 The Japan Development Bank Law enacted

1951–1955

1966–1971

1985–1995

Strengthening of international
competitiveness and creation of social
development loans

Development of lifestyle and social
infrastructure and a smooth industrial
transformation

Aiming to enhance international competitiveness in accordance with the transition to an
open economic system, JDB focused on support
for industrial system improvements and independent technological development. It alsoemphasized social development throughregional development, urban redevelopment,
logistics modernization, pollution prevention,and other measures in a bid to relieve ­problems
accompanying high-level growth.

Pressing needs arose for increased domestic
demand and an industrial structural shift against
a background of aggravating trade friction withother countries. JDB focused on support forsocial capital improvement, creative technological development, and industrial transformationand other issues.
In the 1990s, it targeted environmental andenergy measures and regional economic stimulation with the aim of making Japan a lifestylesuperpower.

Kawasaki Steel Corporation (currently JFE SteelCorporation): Construction of Chiba Steelworks (Chiba)
Modernization of steelmaking through construction of
the first postwar blast furnace

Nissan Motor Co., Ltd.: Auto production facility(Kanagawa Prefecture)
Strengthening of the Japanese automobile industry forcapital liberalization

Kansai International Airport Company, Ltd.:
Kansai International Airport
Construction of a large international hub airport

1956–1965

1972–1984

Reconstruction and self-relianceof the economy
In 1951, JDB was established and commenced
accommodation loans to facilitate the development of the power supply, which forms thebasis of the economy and industry, and therationalization, modernization, and cultivationof coal, steel, marine transportation, and othermajor industries.

1996–2000

High-growth infrastructuredevelopment

Improvements to quality of life andstable energy supply

Creation of a vibrant and affluent
society and stable economy

To expand and reinforce the energy and transportation activities that underpin industrial
infrastructure, JDB served to power new economic expansion. It also provided loans for local
development to correct regional disparities.
Established in 1956, the Hokkaido
Development Finance Public Corporation wasrestructured in 1957 to form HTDFP and beganproviding investments and loans to promoteindustry in these two regions.

JDB began antipollution measures, regional andurban development, other social initiatives, andindustrial development. During the first oil crisis,
it provided investment and loans for energy
alternatives to fossil fuels, as well as efforts toconserve energy, to ensure stable energy supplies. It also supported development of largescale industrial sites.

JDB focused on such important areas as ongoing improvements to social capital, environmental and other measures, and support for
venture businesses. In addition, it swiftly implemented reconstruction loans in the wake of theGreat Hanshin-Awaji Earthquake and loans tostabilize the financial system by functioning asa safety net.

Nippon Yusen Kabushiki Kaisha: Liner Sanuki Maru
Rebuilding Japan’s merchant shipping fleet with financeunder the government’s shipbuilding program

New Town Center Development Co., Ltd. (Now Sunshine
City Corporation): Sunshine City construction (Central
Tokyo) Ikebukuro redevelopment for new urban
configuration

Nakayama Joint Power Generation Co., Ltd.:
Independent power producer (Osaka)
JDB offered project finance for Japan’s first steelmaker
to enter the power generation business triggered byderegulation.

8

Integrated Report 2018

Structural reform

2007 Enactment of the Development Bank of Japan Inc. Act

The 2008 financial crisis / The Great East Japan Earthquake2015 Amendments to the Development Bank of Japan Inc. Act

2001–2007
Financial solutions that support
communities, the environment,
and technology

2008 onward
Development Bank of Japan Inc.
established

Global financial crisis precipitated by
the 2008 financial crisis

Development Bank of Japan Inc. was establishedon October 1, 2008, as a special stock company
by means of conversion to a joint-stock company.
As an impartial provider of industrial finance,long-term funds, and risk capital provided
through integrated investment and loan services,
DBJ addresses the various issues that clients face.

The financial crisis in the autumn of 2008
precipitated a global financial crisis. As thissituation impaired the functioning of the bondmarkets, corporate cash flows worsened. DBJ
responded promptly with financial Crisis
Response Operations. Beginning in January
2009, these operations started to include
purchases of commercial paper in response tofalling functionality in that market.

Corporate GovernanceIn 1999, JDB and HTDFP were dissolved and theDevelopment Bank of Japan was established.
It focused its ­operations in three areas: community ­development, environmental conservation and ­sustainable societies, and the creationof new technologies and industries. In theseways, it contributed to the sustainable development of Japan’s economy.

DBJ Group’s Strategy

Post-bubble economy

PASMO Co., Ltd.: Development of the PASMO IC cardthat transformed public transport convenience
Note: PASMO is a registered trademark of PASMO Co., Ltd.

Risk Management

Great East Japan Earthquake disasterand crisis response

V-Lease Corporation
DBJ entered the business of operating leases for aircraft
engines, of which core parts are produced by Japanese
heavy industry companies. Through this business, we
aim to promote the further development of theJapanese airline industry.

Responding to the March 11, 2011, Great
East Japan Earthquake disaster and crisis, DBJ
worked with other financial institutions toprovide appropriate financing, particularly toelectric power companies. Through the Great
East Japan Earthquake Reconstruction Fund,established jointly with financial institutions in
the disaster-stricken region, DBJ continues toprovide risk capital through such methods as
subordinated loans and preferred shares.

Corporate Data

Development of innovative financial
products focused on sources ofcorporate value
Drawing on the knowledge gained from extending more than ¥3 trillion of investments andloans for environmental conservation projects
over more than 40 years, in 2004 DBJ launched
the Environmentally Rated Loan Program, whichuses its proprietary screening system to evaluate
firms’ non-financial information and determine
loan terms and conditions for selected firms
with high scores. Using the same method, DBJ
followed up with a disaster preparedness loan
program in 2006, which was renamed the BCM
Rated Loan Program in 2011, and the
Employees’ Health Management Rated Loan
Program in 2012.

DBJ Group’s Vision

The Development Bank of Japan (DBJ) was established in 1999. After becoming a joint-stock company in 2008, DBJ
steadfastly engaged in major Crisis Response Operations in the wake of the global financial crisis and the Great
East Japan Earthquake. Every day, DBJ strives to contribute to the sustained growth of the nation by addressing
diverse social needs with financial solutions such as loans, investments, advisory services, and asset management.

Dexerials Corporation
DBJ supported the expansion of operations by providing
management resources, including human resources,
along with risk capital to Dexerials, which has worldleading technologies in the functional materials field.

Overseas business development
DBJ began to develop a foundation for providing investment and loans overseas with theintention of returning knowledge to Japan.

Joban Kosan Co., Ltd.: Spa Resort Hawaiians(Fukushima Prefecture)
Support for a theme park that became a symbol ofreconstruction after the Great East Japan Earthquake

Reinforcement of the function of
supplying growth capital
The Act for Partial Amendment of theDevelopment Bank of Japan Inc. Act, which wasenacted on May 20, 2015, created Special
Investment Operations. This new investment
scheme, a portion of the funding for which isprovided by the Japanese government, is atemporary measure to intensively provide thegrowth capital needed to promote the competitiveness of Japanese enterprises and regional
revitalization.

Senoko Power Ltd. (Singapore)
DBJ provided subordinated financing to Senoko Power,
the largest electric power company in Singapore.

Integrated Report 20189

Three Priority Areas for Realizing a Sustainable Society
Our Aspirations for the Future (Vision 2030)

With its values of initiative and integrity, DBJ Group has consistently responded to changes in the economic environment and social issues by providing solutions to fit the times and contribute to sustainable social development.
This has been accompanied by changes to DBJ Group itself. In 2017, the Group formulated Vision 2030, whichtakes into account changes in the external environment that have a significant impact on stakeholders, in the
pursuit of a sustainable society. In seeking to realize Vision 2030, the Group is building on its roles and dialogue
with stakeholders thus far with a focus on the three priority areas of infrastructure, industry, and the regions.

Roles Undertaken
Providing solutions that meet the needs of the times
amid major changes in the economic environment andsocial issues
Developing high-growth
infrastructure

Strengthening
international
competitiveness

Smoothening industrial
transformation

Creating an affluent
society

Regional revitalization

Regenerating business

Financial crisis response,
post-earthquake
reconstruction

Supplying risk capital

Long-running, continuous
collaboration and dialogue

Future Changes in theExternal Environment
In drawing up Vision 2030, we identified changes in the external environment that could have a major impact
on DBJ Group stakeholders in the
future. These sync with the United
Nations Sustainable Development
Goals (SDGs) and we aim to contributeto realizing those goals.

Population problems

Climate change,
natural resources, and energy
Advisory Board
Monitoring Board

Globalization

Stakeholders
AI, fintech, andother technological innovations

Government budgets,finances, and regulations

10

Customers

Communities

Employees

Financial institutions

Investors

Shareholders

Integrated Report 2018

DBJ Group’s Vision

Realizing asustainable society

DBJ Group’s Strategy

Vision 2030
As professionals in the industrial and infrastructure fields,
leveraging our ability to address diverse risks, taking the lead increating businesses and markets, and precisely responding toCorporate Governancesuch social demand as crisis response, we aim to play a unique rolein the economy and society in 2030.

DBJ Group has established infrastructure, industry, andthe regions as its three priority areas based on the roles
it has played and the functions it has undertaken to date,the social value it has realized, and future changes inthe external environment. Leveraging its professional

Risk Management

Our Three Priority Areas
strengths, the Group is assessing long-term changes inthe external environment to provide creative solutions
to issues confronting clients in infrastructure, industry,
and the regions and thereby play a part in creating asustainable society.

Corporate Data

Rebuilding andReinforcement ofInfrastructure

Creation,
Conversion, and
Growth in Industry

Rebuilding of energy systems,
more advanced transportation
networks, creation of attractive
communities

Commercialization of new technologies, business restructuring
to improve productivity andhone competitiveness, businessdevelopment in global markets

Rebuild energy andtransportation infrastructure,
upgrade public infrastructure

Promote urban growth

New technologies and businesses(promote innovation)
Reorganization
Overseas expansion

Self-Reliance andRevitalization of
Local Economies
Industrial revitalization basedon regional characteristics,
overseas business development, response to inboundtourism, business succession

Solve issues specificto each region
Play a role connecting regions
to Tokyo, regions to regions,and regions to the world

Integrated Report 201811

Sustainability Management
Value Creation Process

As a top runner in sustainability management, DBJ Group seeks to promote sustainable development
in Japan and worldwide with solutions to issues facing clients and society.
The sustainability management targeted by DBJ Group consists of business activities based ona business model that leverages Group capabilities in fields such as integrated investment andloan services and consulting and advisory services. The business model is designed to simultaneously
raise economic value and social value in pursuit of a sustainable society. We are working constantly
on improving our value creation process through collaboration and dialogue with stakeholders,seeking refinements in our sustainability management to elevate the value we create.

Contributing to Solutions in
Our Three Priority Areas with
Sustainability Management

Communication with Stakeholders
Refining our economic and social value creation process throughdialogue with our stakeholders

Rebuilding andReinforcement ofInfrastructure

Rebuilding of energy
systems, more advanced
transportation networks,
creation of attractive
communities

Integrated Investment and Loan Services That Contribute to
Resolving Social and Client Issues

Risk Capital
Finance• Financing

Creation,
Conversion, and
Growth in Industry
Commercialization of newtechnologies, businessrestructuring to improve
productivity and hone competitiveness, business development in global markets• Investment
Creating Diverse
Financial Deal
Opportunities• Assetmanagement
Providing Our
Knowledge

Self-Reliance andRevitalization of
Local Economies
Industrial revitalization
based on regional characteristics, overseas businessdevelopment, response toinbound tourism, businesssuccession

12

Integrated Report 2018

• Consulting andadvisory• Special
Investment
Operations• Crisis Response
Operations

Crisis Response
Operations

Business activities
in tune withrisk appetites

DBJ Group’s Strategy

market instability as mandated under the DBJ Act.
Implementation of DBJ Group’s business model requires
special resources. While healthy financial capital is a vital
support, we also strive for the integrated expansion offinancial and non-financial capital, using clear definitions
for the human capital, intellectual capital, relationship capital, and social capital that impact on our financial value
creation in the long term.

DBJ Group’s Vision

For our clients in industry and infrastructure, we provide
integrated investment and loan services commensuratewith their risk appetite along with consulting and advisory
services. Additionally, for our investor clients we offer syndication and asset management services. These businessactivities extend to regions throughout Japan and overseas.
We also undertake Crisis Response Operations as
required by events such as major disasters or financial

Stakeholders
Customers

Employees

Financial institutions

Investors

Shareholders

etc.
Corporate GovernanceCollaboration,
dialogue

Communities

Advisory Board
Monitoring Board

DBJ Group’s Management Capital Communication

Risk Management

Financial Capital
Creationof financial
value

Investment of management resources

Corporate Data

Human Capital
Long-term
impact on ability
to create
financial value

Economic
Value
Creation

SocialValue
Creation

Increase andconversion ofcapital valueIntellectual
CapitalSustainability Management for
Both Economic and Social Value

Creationof nonfinancial
value

Relationship andSocial Capital
Outcome of business activities

Corporate Governance and Risk Management

Integrated Report 201813

Fourth Medium-Term Management Plan
Initiate Change, Create the Future

Specific strategies for the three priority areas in realizing
DBJ Group’s long-term vision were incorporated into the
Fourth Medium-Term Management Plan for fiscal 2017–
fiscal 2019.
In formulating this plan, we undertook an in-depth analysis of our vision and considered business strategies
centered on sectors, geographical areas, and functions aswell as management foundation strategies for financial andnon-financial capital.
With regard to our business strategy, we are expanding
our integrated investment and loan services for clients inthree infrastructure fields and in industries including new
sectors, and we will be extending these initiatives to regions
across Japan and overseas.
As for our management foundation strategy, we havedivided DBJ Group management resources into thecategories of financial, human, intellectual, and relationshipand social capital. We will promote the growth and transformation of these capitals by investing in our management
resources and improve our business activities to realize
better results.
Amid heightened uncertainty in the external environment, DBJ Group will continue to work as one in line with
its values of initiative and integrity to promote sustainablegrowth through the Fourth Medium-Term Management Plan.
The slogan of the plan—Initiate Change, Create the
Future—designates our intention to spend the next three
years creating a future foundation for DBJ Group that willallow it to respond flexibly to changes in the external environment and take on the challenge of changing itself forthe better.

Business Strategy
P18 – 41

Management
Foundation
Strategy

Fields (Sectors)

Financial capitalIndustrial
fieldsThree infrastructure fields

Functions

EnergyTransportation

Urban
development

Financing(includingcrisisresponse
operations)

Provide higher-value-added services,such as structured financing andmezzanine financing

Investments(including
special­investments
operations)

Promote long-term investments ininfrastructure and growth investments
in companies

Fees andcommissions

Expand the asset management businessin the infrastructure and private equity
fields, in addition to arrangement andadvisory services

Newfunctions

New fields

Investmanagement
resources

Integrated
management

Develop
fields where
innovation isprogressing

Non-financial
capital

Aerospace
Communications
Healthcare
Global logistics

Human capitalIntellectual
capitalOther businessdevelopment

Develop new functions tocomplement financing, advisory, andasset management services

Results ofbusiness activities

Areas

Regions andoverseas

P42 – 53

Relationshipandsocial capital

Support regional globalization, provide financing
opportunities overseas, provide solutions
Role connecting regions to the world

Corporate Governance and Risk Management
P54 – 67

14

Integrated Report 2018

Actual(Consolidated)

Gross ordinary income*1

ActualActualTarget(Fiscal 2016)(Fiscal 2017)(Fiscal 2019)¥182.6 billion¥171.1 billion¥174.3 billion¥190 billion¥103 billion¥87.6 billion¥91.9 billion¥80 billion¥19.2 billion¥4.5 billion¥12.6 billion

—

26%

30%

34%

About 35%

Of which, credit costs (negative = cost)*

2

Expense ratio*3—¥16.5 trillion¥16.9 trillion¥16 trillion

ROA*3 *4

1.1%

1.1%

1.0%

About 1%

ROE*3 *4

3.7%

3.0%

3.1%

About 3%

—

17.2%

16.8%

At least 14%

Total assets

Soundness

Capital adequacy ratio*5

Note: Business categories are those used in business management.

Business Strategy
DBJ Group made progress in constructing a stable infrastructure investment portfolio; using Special Investment
Operations to support the overseas business developmentof regional infrastructure companies; promoting initiatives
in new sectors, particularly special investment in aerospace
through a cooperation agreement with Japan Aerospace
Exploration Agency (JAXA); advancing tie-ups and collaboration with regional financial institutions, including setting
up a cooperation fund; and expanding the asset management business.

Management Foundation Strategy
DBJ Group issued its largest Sustainability Bond ($1 billion)
to date; made progress in workstyle reform and businessefficiency; initiated an employee engagement survey;
promoted cross-department knowledge sharing; and participated in such external initiatives as Principles for
Responsible Investment (PRI).

Integrated Report 201815

Corporate Data

Review of the Fourth Medium-Term Management Plan’s First YearBusiness Profit and Loss (Consolidated)
In investment and loan operations, lending yields weredepressed by low interest rates. However, margins(¥billion)
Fiscal 2016
Fiscal 2017
improved, albeit slightly, as DBJ focused on high-margin
Loans
86.0
84.8
structured products, while the interest rate on external debt
Investment
63.2
65.8
declined due to the maturity of debt carrying high interest
Fee and commission income
21.8
23.6
rates. However, profits edged down due to interest
Gross ordinary income
171.1
174.3
payments on an increased debt balance.
Operating expenses(51.1)(59.1)High profits were maintained in investment operations
Net business profits
120.0
115.1
thanks to factors such as exits. A certain degree of progress
Other extraordinary items(0)
2.2
was made in constructing a stable investment portfolio.
Gains on reversal of reserves and
2.4
11.9
In loan operations, fee and commission income fromcollection of written-off claims
Loans
4.4
12.4
financing declined, but earnings exceeded those in theInvestment
(2.0)
(0.4)
previous fiscal year due to factors such as DBJ Asset
Pretax profit
124.4
129.4
Management’s contribution to profits.

Risk Management*1 Includes stock-related gains/losses, before credit costs and expense deductions*2 Credit costs (negative = cost) = reversal of allowance for loan losses (negative = provision) + reversal of reserve for contingent losses (negative = provision) + loan write-offs (negative) +collection of written-off claims + gain on sale of claims (negative = loss)*3 Expense ratio and ROA versus gross operating profit, ROE versus net income*4 Average for fiscal 2014–2016 uses simple average of ROA and ROE for each fiscal year
*5 Common equity Tier 1 risk-weighted capital ratio

Corporate Governance(Average for fiscal
2014–2016)

Current net income
Profitability

FourthMedium-Term Management Plan

DBJ Group’s Strategy

Third
Medium-Term Management Plan

DBJ Group’s Vision

Financial Targets of the Fourth Medium-Term Management Planbillion, respectively, from the targets of the Third MediumOver the time frame of the Fourth Medium-Term
Term Management Plan.
Management Plan, DBJ Group will increase the supply ofrisk capital, including Special Investment Operations, work
DBJ aims to maintain robust levels of shareholders’diligently to secure a stable earnings base for the longequity and profitability in order to continue conducting
term, and strengthen overseas projects, such as infrastrucSpecial Investment Operations, financial Crisis Responseture projects. The Fourth Medium-Term Management Plan
Operations, and the supply of other risk capital.
targets gross ordinary income of ¥190 billion and net(In the Third Medium-Term Management Plan, our target
income of ¥80 billion, increases of ¥30 billion and ¥10
for net income was ¥70 billion in the final fiscal year.)Financial Market Activation and Stabilization Resulting from Cooperation
and Collaboration under the Fourth Medium-Term Management Plan
Under the Fourth Medium-Term Management Plan, DBJ Group will provide unique solutions through optimal partnerships
with an emphasis on cooperation and collaboration with other financial institutions and non-financial companies.

Infrastructure

DBJ

EnergySpecial Investment Operations

Government
investments
and loans

Government

Transportation

Crisis Response Operations

Urban
development

SRI bonds
Financing

Industry
New technologies
and businesses
restructuring

Consulting andAdvisory Services

Investments

Domestic andoverseas
institutional
investors

Bonds andloans

Risk capital andknowledge

Overseas expansion

Regional financial
institutions

Asset Management

Group Companies

Asset
management

Regions
Industry promotion
Overseasdevelopment

Creation offinancing
opportunities

Collaboration

Cooperation

Financial institutions andnon-financial companies

Business succession

Procurement and Management of Funds	DBJ receives funding in various formats, including the
procurement and management of funds from institutional investors and financial institutions in Japan andabroad, and supplies risk capital to customers in thedomestic and overseas industrial and infrastructure fields.

Leading financial
institutions
Collaborative
funds

Provision of Knowledge
	DBJ Group creates added value through the provision ofknowledge in such forms as surveys and analyses backed
by its experience in industrial and infrastructure fields
and in risk analysis and structuring.
	Crisis Response Operations and Special Investment
Operations
	These operations are mandated by the DBJ Act and will
be properly undertaken as operations backed by theunique strengths of DBJ Group.

Achievements through Financial Market Tie-Ups and Collaboration
	Tie-Ups and Collaboration with Regional Financial
DBJ Asset Management Co., Ltd. Initiatives
P40
Institutions
P29
In its efforts to seek out and provide investment opportunities, DBJ Asset Management Co., Ltd. has set up seven
DBJ Group started borrowing from regional financial instico-investment programs targeted at seven regional financial
tutions in fiscal 2007 as part of its fund-raising activities
institutions and foreign private equity funds as of July 2018.
and has since developed relationships through investment
products such as syndicated loans and the establishment
In April 2018, Japan’s Government Pension Investmentof joint funds (there were 30 at the end of March 2018),
Fund (GPIF) appointed DBJAM as an investment manager
promoting regional risk capital supply.
focusing mainly on Japanese infrastructure.

	Continuing Issuance ofSocially Responsible Investment (SRI) Bonds

16

P43

(As of March 31, 2018)2017$1 billion

2016$500 million

2015€300 million

2014€250 million

Integrated Report 2018

DBJ Securities Co., Ltd. Initiatives
In addition to products that leverage DBJ Group strengths,
such as green bonds and bonds with business continuity
management ratings, DBJ Securities is addressing diverse
investor needs by introducing investors to instruments suchas Tokyo Pro-Bonds and private equity funds while also
seeking to stimulate financial market activity.

DBJ Group’s Strategy Business Strategy
Sector Strategy
18		 Energy Sector
DBJ Group
Working in unison, DBJ Group provides diverse,
high-value-added solutions for solving various
issues faced by its customers and for solving
issues throughout society.

20		 Transportation Sector
22		 Urban Development Sector
24		 Industrial Sectors
Area Strategy
28		 R egions
32		 Overseas

Overseas
locations• DBJ Singapore Limited• DBJ Europe Limited• DBJ Investment Consulting (Beijing) Co., Ltd.

Function Strategy
34		 Special Investment Operations /Crisis Response Operations

38		 Syndication, Advisory,
Investments
and loans, Assetmanagement• DBJ Capital Co., Ltd.
• DBJ Investment Advisory Co., Ltd.
• DBJ Securities Co., Ltd.
• DBJ Asset Management Co., Ltd.

Consulting Services

40		 Asset Management
Management Foundation Strategy
42		 Financial Capital

Research,
Consulting• Japan Economic Research Institute Inc.
• Value Management Institute, Inc.

46		 Human Capital
50		 Intellectual Capital
52		 Relationship and Social Capital

Real estate
management /IT services• DBJ Real Estate Co., Ltd.
• Consist, Inc.

Integrated Report 201817

Sector Strategy

Priority
Areas

Rebuilding of energy systems, more advanced transporta-

Rebuilding and Reinforcement of Infrastructure tion networks, creation of attractive communities

Energy Sector 
DBJ will contribute to the realization of a low-carbon society worldwide and the globalization of Japanese energy companies by taking
a leadership role in the financing of change in Japan’s energy markets.

Main Business Fields
Financing and advisory services areprovided to companies and projects inthe following sectors:• Electricity
• Gas
• Oil

Longer-Term External Environment and Social Issues
Japan’s energy industry is at a major crossroads. Withchanges in the macroeconomic structure, including the
population decline, and advances in energy conservation,
DBJ must promote the reduction of CO2 emissions while
dealing with deregulation in the electric power and gas
markets at the same time.
Under these conditions, issues related to financial
support for the energy industry entail the supply of capitalfunding to spur the spread of renewable energy and othernew technologies and to address growing risks. Moreover,risks in project financing need to be clarified more clearly,
and efforts should be undertaken to allow market participation by a broader range of companies.
Strategy
While maintaining strong relationships with customers, DBJ
will focus on providing capital funding (risk money) andadvisory services to facilitate industry restructuring.
Furthermore, DBJ will focus on the smooth supply of capitalby collaborating with a broad range of financial institutions
to meet demand for investments in the deregulated electric
power market in Japan, in addition to strengthening initiatives in project financing with clarified risk allocation.
DBJ Group will reinforce its asset management operations in the energy field with the aim of nurturing markets
able to recycle capital, thereby allowing more financial
institutions to participate in the domestic energy infrastructure market.

18

Integrated Report 2018

Balance of loans in the electricity,gas, oil refinery, heat, and water sectors
As of March 31, 2018¥3.4 trillion
Overseas, DBJ aims to become more involved in markets
that have taken the lead in fostering deregulation, andthen return any knowledge gained to the domestic market
to advance its development, while proactively supporting
Japanese companies in their efforts to develop businessoverseas. Through these and other efforts, we aim tocontribute to the realization of a low-carbon society on
a global basis.
Accomplishments and Initiatives to Date
In recent years, DBJ has assisted with business restructuring
and overseas business development in the electricity, gas,and oil sectors against a backdrop of structural reforms inthe domestic energy industry. DBJ has provided optimal
financial solutions in tune with the needs of the times,
concentrating on the replacement of aging thermal power
plants and the construction of new renewable energy
power plants.
Initiatives in fiscal 2017 included the raising of funds
for domestic solar power generation projects and a joint
investment with Tokyo Gas Co., Ltd. in a gas distributor inIndonesia. While helping Japanese energy firms strengthen
their overseas operations, DBJ has participated in projects
in the U.S. market, which is a pioneer in deregulating theelectric power market. For the purpose of gaining insightfor the domestic market, DBJ also participated in a natural
gas power generation project in Pennsylvania, U.S.A.

DBJ Group’s Vision

Case Studies

SDT Solar Power / Green Power Tsugaru
Green Power Tsugaru
DBJ, together with megabanks, helped raise project
financing for Green Power Investment Corporation, arenewable energy developer in which DBJ has invested,
to construct Wind Farm Tsugaru (121.6 MW), the largest
wind power generation project in Japan, in Tsugaru City,
Aomori Prefecture. Although some of its construction
began in 2017, Wind Farm Tsugaru truly began to takeform once the project financing was raised. The projectcontractor, Kajima Corporation, plans to install 38 windturbines made by General Electric with 3.2 MW of
output. When this project finishes construction in April
2020, it will be able to supply electricity equivalent to theannual energy consumption of 90,000 households.

DBJ Group’s Strategy
Corporate GovernanceRisk Management

SDT Solar Power
DBJ, Solar Frontier K.K., and Taiyo Oil Co., Ltd. established SDT Solar Power K.K. to develop and operate a17.3 MW-scale power generation project that uses solar
panels made by Solar Frontier K.K. at a solar and oil business site in Yamaguchi Prefecture. Construction on the
power plant began in summer 2016, and the facility
commenced commercial operations in November 2017as a reliable source of clean energy. DBJ not only helpedwith financing, but was also the financial advisor for thecompany, assisting with the formulation of a businessplan. DBJ also coordinated with a group of banks toraise project financing during the construction phase,with The Yamaguchi Bank, Ltd. as the arranger and aproactive supporter of projects
that help revitalize the region
and expand the use of renewable energy.

Rendering of completed wind farm

Message from Employees

Trying a New Type of Renewable Energy Financing
Corporate Data

With decarbonization trending around the world, renewable energy has increasingly drawn attention. Aiming to help the government reach its target for a renewable energy ratio of 22–24% by2030, DBJ will support the financing of renewable energy projects while focusing on the characteristics of each type of energy source, such as solar, wind, biomass or hydro power. Thanks to thefeed-in tariff system that was introduced in 2012, it has become possible to expect stable revenues
from each renewable energy power plant. As a result, project financing has been on the rise as ameans of procuring funds for renewable energy plants. Although it takes time to put financing
together, including negotiating contracts and creating revenue models, upon visiting the completed
power plant, I came away with a profound sense of satisfaction with the meaningful work that wasdone. Lately, financing for renewable energy power plants has been on the rise, and from the standpoint of a sponsor, it has been a learning experience for me every day, participating in the operationof the power plant, drawing up annual budgets, and fixing broken equipment.

Efforts to Combat Climate Change in the Energy Field
Sustainability management means balancing economic value withsocial value. Based on this fundamental principle, the DBJ Group has
worked for many years to ensure a reliable supply of energy while
reducing environmental impacts.
In the renewable energy field in particular, DBJ supplies diverse
risk capital, including project financing, mezzanine loans and equity
financing, to wind and solar power generation projects in Japan
from their initial stages. DBJ also finances offshore wind power
projects in Europe, with the aim of learning from cutting-edge
initiatives overseas and applying those lessons in Japan.
In view of the global debate about climate change and theOECD’s Arrangement on Officially Supported Export Credits, aswell as Japan’s energy policy based on the 3E+S* strategic plan,
DBJ works to ensure reliable supply while combating climate change.
In renewable and alternative energy, we plan to increase the supplyof risk capital for wind and solar power, new power grids, andhydrogen projects in order to encourage their introduction. For new
projects involving coal-fired power plants, which emit large amountsof greenhouse gases, DBJ takes a more cautious approach. In theprocess for finance decisions, we evaluate each project from environmental perspectives, such as whether generation efficiency is at or
above the ultra-super-critical level, in order to reduce environmental
burdens as much as possible.
* Energy security, Economic efficiency, Environment, and Safety, as stated in Japan’s Basic Energy Plan.

Integrated Report 201819

Sector Strategy

Priority
Areas

Rebuilding of energy systems, more advanced transporta-

Rebuilding and Reinforcement of Infrastructure tion networks, creation of attractive communities

Transportation Sector 
DBJ aims to lead in a financial aspect the growth of the transportation
sector and advancement of transportation networks in Japan. DBJ will
also act as a bridge between Japan’s financial market and the global
transportation finance market.

Main Business Fields
Provision of financing to companies andfor projects in the transportation sector• Land transportation• Marine transportation• Air transportation

Longer-Term External Environment and Social Issues
Around the world, growing populations will lead to thegreater movement of people and goods and spur growthin the transportation sector. In Japan, a country reliant on
trade, it is imperative to maintain the reliable transportationof goods and address issues, such as the declining andaging population, as well as the influx of overseas visitors.
Accordingly, various issues are waiting for solutions forsustaining growth in the transportation sector and increasing the sophistication of transportation networks. Keen to
help its customers solve these issues, DBJ Group will
provide financial solutions tailored to diverse needs while
acting as a bridge between financial markets in Japan andthe global transportation finance market.
Strategy
While maintaining relations with customers in the transportation sector, we will refine our ability to respond flexibly tochanges in the external environment and society. Morespecifically, DBJ will further strengthen its optimal financial
solutions for quality projects and assets in the land, marine,
and air transportation fields, as well as supply risk capital to
Japanese companies for sharpening their international
competitiveness. Additionally, DBJ will provide financing

20

Integrated Report 2018

Balance of loans in the transportation infrastructure (transportation industry) sector
As of March 31, 2018¥2.2 trillion

opportunities to Japanese regional banks and other financial institutions and investors in the global transportation
finance market through improved syndicated loans andvarious investment and loan products that utilize investment and securities functions.
Accomplishments and Initiatives to Date
In recent years, DBJ has provided financial solutions
optimized to satisfy modern needs, including debtor-inpossession financing for a Japanese start-up airline, participation in airport concessions, aircraft financing with a focus
on material value, and ship financing to support industrial
value chains.
Initiatives in fiscal 2017 included collaboration withprivate financial institutions in syndicated loans for Solaseed
Air Inc. to acquire aircraft, project financing for the expansion of operations at the international passenger terminalbuilding at Haneda Airport, and project financing for LNG
carriers in response to the increasing attention on clean
energy. Moreover, DBJ collaborated with Sumitomo Mitsui
Banking Corporation to create the world’s first aircraft
financing scheme with insurance features. DBJ China and
DBJ Securities worked together on the issuance of bonds for
China Eastern Airlines on the TOKYO PRO-BOND Market.

DBJ Group’s Vision

Case Study

Re-Expansion Project of Haneda Airport International Terminal

Corporate GovernanceRisk Management

Rendering of completed Haneda Airport International
Terminal

Corporate Data

Message from Employees

DBJ Group’s Strategy

Tokyo International Air Terminal Corporation (TIAT), which operates the international passenger terminal building at Haneda Airport, is undertaking a project toexpand the terminal in preparation for a planned increase in international takeoff and landing slots at Haneda Airport in 2020. For this project, DBJ raised a
total of ¥145 billion (including about ¥95 billion in preexisting investments andloans) in project financing as the lead arranger.
Based on the Asian Gateway Initiative, TIAT was established in 2006 as a
special-purpose company (SPC) to implement a completely financially independent private finance initiative (PFI) project to internationalize Haneda Airport,
which had primarily served domestic routes back then. When TIAT was established, DBJ was deeply involved in the project as the lead arranger for putting
together syndicated loans with other financial institutions, and was also an
investor in its preferred shares. DBJ helped with raising additional funds for the2014 expansion and the most recent expansion of the airport.
The internationalization of Haneda Airport strengthened the appeal of theTokyo metropolitan area with 24-hour operations and convenient access to thecity center. Amid a sharp increase in the number of foreign tourists visiting
Japan, the greater passenger capacity at Haneda Airport will likely contributesignificantly to the region as a transfer point between domestic and international routes. The project to expand the international passenger terminal willplay an essential role in welcoming a greater number of foreign tourists as aresult of public–private initiatives to promote Japan as a tourism destination andin hosting the Tokyo 2020 Olympic and Paralympic Games. DBJ will continue tocontribute to the healthy development of the Japanese economy and promote
the movement of people by increasing the sophistication of transportation
networks while reinforcing Japan’s mainstay transportation infrastructure,­beginning with airports.

Helping to Open Skies as a Gateway to Japan

This expansion project not only expanded buildings for the international passenger terminal, but also ventured in new directions, including the sharing of domestic and international routes at the No. 2 domestic terminal, a rarity in Japan, and an
examination of possible flight routes over the Tokyo metropolitan area. In light of the steady flow of passengers, there was no
doubting the overall potential of Haneda Airport with its prime location and brisk demand. Nevertheless, each issue wascarefully addressed while all the details were worked out. The airport management business entails various risks withelements of commerce and real estate mixed in. DBJ brought its project experience and expertise to bear on the analysis anddecision-making for whether project financing would be a frameworkthat could absorb all these risks. For an island nation like Japan, airports
are a special place because they serve as the gateway for both people
coming to Japan and those leaving on a trip. The expansion of international capacity at Haneda Airport, which is a special venue for businesstravelers and tourists thanks to its close proximity to the Tokyo metropolitan area, will further open the nation to the rest of the world. Despite
my limited contribution, We are proud to have played a role in thisexpansion project.

Integrated Report 201821

Sector Strategy

Priority
Areas

Rebuilding of energy systems, more advanced transporta-

Rebuilding and Reinforcement of Infrastructure tion networks, creation of attractive communities

Urban Development Sector 
Our vision is to grow alongside cities by helping with the maintenance, renewal, and expansion of urban functions. We also aim togrow with the real estate financing market as a market-stabilizing
mechanism.

Main Business Fields
Loans and investments in urban development projects undertaken by developers,
special-purpose companies for owning realestate, loans and investments for real estate
investment trusts (REITs), and managementof DBJ Green Building Certification with
the Japan Real Estate Institute• Urban development business• Real estate financing• Green Building Certification

Longer-Term External Environment and Social Issues
Increasing the international competitiveness of cities inJapan is key to enhancing the country’s overall competitiveness. Urban infrastructure, built up since 1945, is coming
due for an upgrade. Seamlessly upgrading urban infrastructure without interruption is important from the standpointof creating communities that take into account the environment and society.
The real estate finance market, an essential part of creating communities, is prone to instability due to international
exposure. The securitization market in particular was greatly
affected by the global financial crisis, while the real estate
finance market was thrown into disarray. In spite of suchconditions, it is necessary to ensure a reliable supply of
capital, spur growth in the real estate finance market, andpromote urban development.
Strategy
DBJ will facilitate urban development through the supply ofrisk capital, including financing for developers and individual development projects. We also support the growthof REITs, which have become increasingly important entities
for the stable management of properties.
DBJ will provide opportunities to invest in quality assets
for institutional investors around the world as well as
regional financial institutions. By engaging in collaborative
financing through proper risk-sharing agreements, we will

22

Integrated Report 2018

Balance of loans in the real estate sector
As of March 31, 2018¥1.8 trillion

create stable cash flows in the realestate finance market.
DBJ Green Building Certification
was created in fiscal 2011 as asystem for evaluating and certifying real estate from an environmental and social perspective. DBJ
continues to operate this system along with the Japan Real
Estate Institute, while endeavoring to improve the evaluation of environmental and social aspects of real estate.
Accomplishments and Initiatives to Date
In recent years, DBJ has concentrated efforts on loans andinvestments in urban development projects undertaken by
developers, special-purpose companies for owning realestate, and loans and investments for REITs.
As for special projects undertaken in fiscal 2017, DBJ
arranged subordinated loans under its Special Investment
Operations for Hulic Co., Ltd., as well as mezzanine loans
for an SPC that acquires and manages housing that
promotes employment.
As of March 31, 2018, a total of 539 properties havebeen recognized with DBJ Green Building Certification.

DBJ Group’s Vision

Case Study

Helping Nippon Steel Kowa Real Estate in the Development of AKASAKA INTERCITY AIR

Corporate GovernanceRisk Management
Corporate Data

Message from Employees

DBJ Group’s Strategy

Located in Akasaka 1-chome, AKASAKA INTERCITY AIR is alarge-scale, mixed-use 38-story, 205-meter tall building withhigh-spec offices, conference rooms, retail stores, medical
offices, and housing with direct access to a Tokyo Metro
train station. The Akasaka 1-chome district is a rare part ofcentral Tokyo that consists of a mix of office and residential
areas and an international atmosphere represented by the
many embassies and foreign companies present there.
The property has over 5,000 square meters of greenerythat cover over half the site, giving office workers, residents,
passersby, and other members of the community a place
to rest and relax. Situated along the Roppongi thoroughExternal view of AKASAKA INTERCITY AIR
fare, the property creates a green oasis in the center ofthe grounds.
In addition, with about 200 meters of trees lining theboulevard on the west side, the project was designed to complete a network of green pathways for pedestrians thatconnect to Toranomon, based on the Akasaka–Toranomon Green Road Concept of about 850 meters of tree-lined roads
that start at Circular Route #2.
The development project received DBJ Green Building Certification (plan certification) as a building incorporating
outstanding environmental and social considerations in Japan, in recognition of its consideration for the environment,
amenities that satisfy the diverse needs of tenants, and excellent BCP performance.
Small and medium-sized office buildings in the 23 wards of Tokyo are advancing in age, and many were built underolder earthquake resistance standards. Ever since the Great East Japan Earthquake, companies have put more emphasison the earthquake-resistance, disaster preparedness, and BCP of office buildings when they move locations.
In light of the current conditions, Nippon Steel Kowa Real Estate Co., Ltd. is working on the development of the
BIZCORE series of high-grade, medium-sized office buildings, leveraging its know-how accumulated in the development,
management, and operation of more than 90 office buildings in the city center.
DBJ, along with private financial institutions, supports development by providing business funds to Nippon Steel Kowa
Real Estate for the upgrading and maintenance of the urban foundation.

Ongoing Support for Urban Redevelopment

Tokyo and other major cities in Japan are among the first in the world to have reached a mature stage. Reinforcing andrenewing urban functions has become an issue within the context of strengthening international competitiveness, improving
disaster preparedness, fostering tourist destinations, creating green spaces,
reinforcing the earthquake resistance of aging small and medium-sized
office buildings, and adapting to diverse work styles. The construction of
AKASAKA INTERCITY AIR, which opened its doors in September 2017,
and the development of the BIZCORE series are a part of efforts to help
solve these issues faced by cities. Real estate development requires large
sums of funds, and it takes a long time to recover investments. For thesereasons, it is often the case that deep risk-taking is necessary with stable,
long-term financing and mezzanine loans. We aim to back such efforts tocreate communities through the ongoing provision of business funds andassistance with financial technologies, such as asset financing.

Integrated Report 201823

Sector Strategy

Priority
Areas

Commercialization of new technologies, businessto improve productivity and hone competiCreation, Conversion, and Growth In Industry restructuring
tiveness, and business development in global markets

Industrial Sectors 
In industrial fields seeing changes brought about by technologicalinnovation, the creation of new businesses, and restructuring, DBJ
Group will take a direct approach to solving issues faced by customers
and society while searching for growth opportunities for itself. As an
incubator that creates new businesses and markets, DBJ aims to play
an essential role in strengthening the competitiveness of industries inJapan.
Main Business Fields
Provision of financing and advisory services for companies andprojects in the industrial sector• Manufacturing• Communications, broadcasting, media• Retail and foods• Healthcare• Hotels, Japanese-style inns, tourism, etc.

Longer-Term External Environment and Social Issues
Amid changes in the external environment, including population problems, globalization, and such technological innovations as AI, customers are dealing with a variety of issues
that include the commercialization of new technologies
and other innovations, business restructuring to enhance
productivity and competitiveness, and overseas businessdevelopment with an eye on new growth opportunities.
Meanwhile, the financial environment is likely to include
diversification in capital providers, considering the ongoingsurplus capital conditions and advances in fintech and othertechnologies. As it becomes easier to access capital, providing unique added value will become essential to helping
customers solve their problems on the financial front.
Strategy
DBJ will offer solutions to the issues faced by customers—
centered on the fields of business portfolio optimization,
new business creation, overseas business development,
financial strategy, and capital policy—by mobilizing its
financing functions, knowledge, and unique networks
while leveraging its insight and expert knowledge of eachindustry. DBJ has created teams of specialists for establishing a solid business foundation in the aerospace, communications, and healthcare fields since 2017, and in thelogistics field since May 2018. While being deeply involvedin each industry, DBJ keeps an eye on socioeconomic megatrends and changes in the landscape to facilitate innovation

24

Integrated Report 2018

on various fronts of business development across industries(such as moving toward a hydrogen-based society) without
being beholden to traditional frameworks.
Accomplishments and Initiatives to Date
In the 1990s, DBJ was involved from an early stage infinancing new businesses, utilizing its ability to survey
industries and analyze corporations derived from its trackrecord of providing long-term capital for capital investments. From the early 2000s, when business and industry
restructuring came to the forefront, DBJ ramped up debtorin-possession financing, private equity investments, and
M&A advisory services. Since becoming a joint-stockcompany in 2008, DBJ has leveraged its knowledge andexperience in these fields to further improve its ability tosurvey industries. At the same time, DBJ has helped companies enhance their competitiveness and clients solve various
problems through advisory services backed by loans andinvestments to create new businesses and rebuild finances
while entering overseas markets and spinning off non-corebusinesses.
Initiatives in fiscal 2017 included the provision of DBJ
rated loans (see page 51) for the materials industry amid
growing interest in environmental, social, and governance(ESG) issues. These also included helping Fujitsu Ltd. andLenovo Group Limited establish their joint venture in the PC
business, in addition to efforts in new business fields.

Integrated Report 201825

Corporate Data

Healthcare
In the healthcare field, DBJ Group has focused on medicine
and nursing care, and has launched new initiatives in thelife sciences field.

Risk Management

Responding to Innovation
Over the past few years, there has been a sudden rise intechnologies and innovations, such as in IT, new materials,
new energy, bioscience, and robotics, with the potential tosubstantially change the existing fabric of industry andsociety. For these new technologies to help society and leadto the creation of new businesses, it is important to spreadnew value systems and lay down rules for collaboration
across industries and between the public and private sectors.
DBJ Group created the Innovation Promotion Officeunder the Business Planning & Coordination Department inApril 2017 to facilitate collaboration among these diverse
players and take the long view for moving projects forward.
As for initiatives in fiscal 2017, DBJ, along with 10 othercompanies including automakers and infrastructure developers, established Japan H2 Mobility, LLC (JHyM) for the
purpose of building out a network of hydrogen refuelingstations for fuel-cell vehicles.

Corporate Governance

Logistics
In May 2018, DBJ newly established the Global Logistics
Office in its Corporate Finance Department, Division 3, inorder to sharpen its focus on the logistics field in light ofsweeping changes in the logistics industry being ushered in
by technological innovations including AI and IoT.
In terms of financial support, the Global Logistics Officesupports improvements in competitiveness and productivity
in the logistics field through assistance for creating new
industries with the latest technologies, the supply of risk
capital to companies innovating on the technological front,
and investments and loans for the latest, high-function
logistics facilities.
In terms of information support, DBJ holds Logistics
Innovation Workshops for industrial, government, andacademic entities to discuss issues and approaches related
to technological innovation in the logistics industry.

DBJ Group’s Strategy

Communications
Communications networks are responsible for handlingever-increasing volumes of data and communications traffic, and their importance is only growing. Along with thearrival of a society where everything is connected together
over networks, as key social infrastructure, communications
networks will have to become more resilient andsophisticated.
Our initiatives in fiscal 2017 included providing financing
for core communications assets, such as communications
towers and data centers, as well as purchasing shares, alongwith JTOWER Inc. and RISA Partners, Inc., in an operatingcompany in Vietnam with the largest In-Building Solution(IBS)—that is, mobile communications infrastructure s­ haring
inside buildings. In these and other ways, DBJ is proactively
supporting the overseas business development of Japanese
growth companies that have advanced technologies.

As for initiatives in fiscal 2017, DBJ cooperated with the
Ministry of Economy, Trade and Industry on the dissemination of knowledge related to medical equipment innovation. DBJ also provided growth opportunities and supported
overseas business development by matching Japanesecompanies with foreign firms through financing for medical
equipment venture funds in North America.

DBJ Group’s Vision

Aerospace
DBJ has been assisting the aircraft field for 30 years or so,ever since the Japan Development Bank era, through lending facilities based on the Aircraft Industry Promotion Act
for Japan’s first international joint development project for
jet engines. In April 2017, DBJ established the Aerospace
Office with the aim of developing the outer space field,
which is expected to grow as a new industry, in addition to
the aircraft field, leveraging the abundant knowledge andnetworks it has accumulated.
In fiscal 2017, initiatives in the aircraft field included theprovision of risk capital through Special Investment
Operations to support expansion in the civilian helicopter
business of Kawasaki Heavy Industries, Ltd. and the aircraft
engine businesses of Uemura K.K. and AeroEdge Co., Ltd.
In the outer space field, DBJ signed a collaborative agreement with Japan Aerospace Exploration Agency (JAXA) in
May 2017, under which it published a report titled“Strengthening the Competitiveness of Japan’s Space
Industry.” DBJ also invested in Global Positioning
Augmentation Service Corporation, a company planning asatellite positioning service accurate to the centimeter level
using Japan’s version of GPS; New Generation Small Rocket
Development Planning Co., Ltd., a company developing
small rockets; and ispace, inc., a company working tocommercialize resource development on the moon’s surface.

Sector Strategy

Case Study

Establishment of Joint Venture for Building Out Network of Hydrogen Refueling Stations
In February 2018, Japan H2 Mobility, LLC (JHyM) was establishedthrough joint investments by a total of 11 companies including DBJ
for the purpose of building out a network of hydrogen refuelingstations for fuel-cell vehicles (FCVs).
The newly established JHyM aims to bring Japan one step closer
to a hydrogen-based society by facilitating the proliferation of FCVs
and a self-sustaining hydrogen station business based on its plans to
Press conference on establishment of JHyM
create and fine-tune a network of optimally located hydrogen refueling stations across Japan.
Under the guidance of the Ministry of Economy, Trade andFinancing
JHyM
Infrastructurecompanies
Industry, the Strategic Roadmap for Hydrogen and Fuel Cells was
drawn up in March 2016 to define public–private targets for the
Financing
Deployment
New
Investors
JHyM
proliferation of hydrogen refueling stations for FCVs toward thehydrogenrefueling
realization of a hydrogen-based society in the future. JHyM wasstations
SubsidiesJapaneseestablished after it became apparent that a new framework isgovernment
needed for collaboration among the Japanese government, automakers, and hydrogen station network operators.
Use of funds from investors helps reduce initialinvestment burden of infrastructure companies
DBJ has cooperated with the parties involved in this project fromthe initial stages, working toward its realization, and helped bring
the project to fruition as the chief advocate for establishing the new company.
This initiative was highly significant for DBJ, bringing with it a recognition of its role in improving social value by helping move Japan toward a hydrogen-based society, as DBJ promoted this joint project while enlisting the cooperation of
key domestic players in the automobile and energy sectors. Other parties involved in this project stand to benefit as well,as it lessens initial risks related to the hydrogen refueling stations for infrastructure developers and spurs sales of FCVs forautomakers. The project also contributes to Japan’s energy policy, which seeks to expand the use of hydrogen energy
from the perspectives of energy security, energy conservation, and lessening environmental load.

Message from Employees

DBJ’s Financial Capabilities Help Make
Hydrogen-Based Society a Reality

For this project, DBJ was asked to play a specific role in navigating conflicts of interest among the involved parties, creating
business models, and formulating revenue targets. Navigating the conflicts of interest was rather difficult in this case, owing
to the many parties involved having different points of view. DBJ designed a framework to minimize risks and found thecommon ground where all the involved parties are satisfied. All of this led to the establishment of JHyM.
Creating the business model was also quite difficult due to the considerable uncertainties about the future, the rarity ofsuch projects in terms of the diverse parties involved from across various industries, and because it took so long to getthrough the examination phase. The project was also unique in that it was an all-Japan initiative, making it necessary toclear regulatory hurdles under the Anti-Monopoly Act.
Regardless, DBJ’s involvement in this paradigm shift in the automobile industry, a core industry in Japan, carries with it great meaning. Whether or not the automobile industry continues to drive
growth in the Japanese economy depends on the ability of eachdomestic player to address environmental issues. Japan has the besthydrogen-related technologies in the world, and for Japan to lead theworld, we believe DBJ will need to play a major role through JHyM.

26

Integrated Report 2018

DBJ Group’s Vision

Case Study

Development of the Domestic Space Industry
by Commercializing a New Generation of Small Rockets
DBJ Group’s Strategy
Risk Management
Corporate Data

Message from Employees

Corporate GovernanceIn August 2017, DBJ, along with Canon Electronics Inc., IHI AEROSPACE Co., Ltd., and Shimizu Corporation, established
New Generation Small Rocket Development Planning Co., Ltd. for the planning and examination of the small rocket
launch business, with the aim of tapping into demand for launching small satellites into outer space, a potential growthfield around the world.
In July 2018, New Generation Small Rocket Development Planning and the aforementioned four companies decided
to proceed to the business development stage after examining the feasibility of the business. After an additional roundof investment from the four companies, New Generation Small Rocket Development Planning was renamed Space One
Co., Ltd. and turned into an operating company. As major players in their own fields, the four companies’ collaborationon the project has given it more credibility. With a corporate vision of providing the most frequent launches in the world
for highly convenient access to outer space, the new company plans to accelerate efforts toward the commercializationof launch services during fiscal 2021.
As each company commits their expertise to the project, such as Canon Electronics’ know-how in reducing mass
production costs for consumer electronics, IHI AEROSPACE’s advanced technologies in rocket development, and Shimizu’s
resources in infrastructure development, DBJ’s role will be to act as a neutral facilitator of their alliance while examining
the feasibility of the business by leveraging its know-how accumulated in advancing and supporting the development of
the aircraft industry.
The establishment of infrastructure for frequently launching satellites
on small rockets in Japan will create greater opportunities for domestic
aerospace companies, which have had to rely on overseas rockets to gettheir satellites into space. As conditions come into place for creating businesses while technologies are verified, we anticipate the smooth development of technologies and businesses in the outer space field. Accordingly,
this project is highly significant for the development of Japan’s spaceindustry. DBJ is fully committed to this project in its aim of helping
strengthen the competitiveness of Japan’s space industry through new
Rocket launch at Japan Aerospace Exploration Agency (JAXA)
business development via collaboration across different sectors.
Photo courtesy of JAXA

Corporate Collaboration across Industries and
New Business Creation

Canon Electronics is a leading mass-producer of electronics in the Canon Group. IHI AEROSPACE has engineered anddeveloped rocket launches for national projects while collaborating with other manufacturers. Shimizu has always been on
the front lines of infrastructure development in Japan. Although each company shares the same goal of creating a rocket
business by marshaling the necessary technologies and resources, they are all pieces in a great puzzle with different corporate
cultures and major gaps in the languages used to describe technological development. To steer the project toward commercialization, it was necessary to have someone put these pieces of the puzzle together. DBJ has functioned well as a mediator
for aligning opinions and forming business plans, because as a bank, DBJ has developed contacts across various industries,
and it has many years of experience working with the IHI Group, which is assuming the main role in rocket development
for this project, through its aircraft engine business.
In particular, while each company struggled to set clear targets for this project as
a new business, DBJ has provided key support for defining and setting targets fromthe standpoint of creating a space industry through this project and aiming to establish profitable businesses for the participants. There is a risk that unforeseen troubles
or problems will arise, but we will do our best to support the creation of new businesses and industries in Japan while making adjustments from a broad top-downview of the project.

Integrated Report 201827

Area Strategy

Priority
Areas

Self-Reliance and Revitalization of
Local Economies

Industrial revitalization based on regional characteristics,
overseas business development, response to inboundtourism, business succession

Regions 
DBJ Group provides solutions for regional issues, connecting regions
throughout Japan to Tokyo, domestic regions to those overseas, andregions the world over to each other.

Outline
DBJ Group provides services tailoredto the characteristics of each regionin Japan from 10 branches and eight
representative offices across the country.

• Investments and loans• Consulting services• Planning and research services

Longer-Term External Environment and Social Issues
The regional economic outlook is severe with declining
household spending and weaker demand for loans alongside a long-term downtrend in regional populations. As
regional economies contract, regional enterprises needgrowth strategies that include overseas business development, measures to improve corporate value through business restructuring and succession, and ascertainment ofgood opportunities in asset management.
Strategy
DBJ will provide services with two objectives in mind—
namely, to create value by connecting regions throughout
Japan to Tokyo, domestic regions to those overseas, andregions the world over to each other, and to solve problems
through risk capital and consulting. More specifically, while
taking into account regional characteristics, the themes of
key objectives entail improving the productivity and growthstrategies of regional companies through business restructuring and overseas business development, respectively, andcooperating with regional financial institutions to create
opportunities in asset management. As a part of these
initiatives, DBJ created the Regional Investment Promotion
Office in the Strategic Finance Department under the chief
investment officer on April 1, 2017, for the purpose of
facilitating the supply of risk capital to regional mid-tiercompanies and small and medium-sized enterprises.
By providing detailed solutions to regional problems, DBJ
Group strives to increase the value of its human capital(e.g., the skills and experience of its managers and employees), and relationship capital (e.g., networks).
28

Integrated Report 2018

Total number of business alliances withfinancial institutions
March 31, 2018107

Accomplishments and Initiatives to Date
In recent years, DBJ has provided financing tailored to thecharacteristics of each region through its Regional Areas
Genki Program (see page 29), risk capital through joint
funds with regional financial institutions, and knowledge tolocal governments. Through Crisis Response Operations, DBJ
has also provided assistance for reconstruction in the wakeof natural disasters in various regions, including the Great
East Japan Earthquake and the Kumamoto earthquakes.
Initiatives in fiscal 2017 included Special Investment
Operations providing support for the overseas businessdevelopment of local companies, as well as assistance fordomestic hotel operators through a joint fund with Hoshino
Resorts Inc. Additionally, DBJ formed funds with The
Hokuriku Bank, Ltd. and The Shizuoka Bank, Ltd., and it
also jointly developed loans with special provisions to waive
the original principal in the event of an earthquake withThe Hiroshima Bank, Ltd. DBJ also supplied risk capital toregions through collaboration with regional financial institutions, including assistance for evaluating the feasibility ofbusinesses for regional financial institutions. As of March
31, 2018, DBJ has entered into business alliances with a
total of 107 financial institutions.
Moreover, DBJ engaged in a variety of other activities, as
it distributed knowledge through the publication of reports
about solving regional issues, provided advice and suggestions for advancing PPP/PFI and rebuilding public infrastructure, supported the management of public assets, andoffered advisory services to local public organizations
related to comprehensive government policies.

DBJ Group’s Vision

Head office
10 branches
Eight representative offices
Kushiro Representative Office

Hokkaido Branch

Hakodate Representative OfficeNiigata Branch

Hokuriku Branch
Okayama Representative Office

Tohoku Branch

Matsue Representative Office

Head Office

Chugoku Branch
Kyushu Branch

Minami-Kyushu Branch

Collaboration and Cooperation with
Regional Financial Institutions

Shikoku Branch
Matsuyama Representative Office

DBJ provided support to 21 companies and held study
groups to help regional financial institutions gain a better
understanding of business feasibility assessments.
Collaboration for M&A of Local Companies andOverseas Information Dissemination
DBJ helps local companies address various management
issues, such as business restructuring and succession as well
as expansion of business domains, including overseas
expansion. As part of efforts to revitalize regions throughcollaboration with regional financial institutions, DBJ
creates M&A opportunities for local companies through its
network of regional banks (75 regional banks as of March
31, 2018). DBJ also provides information to regional financial institutions helping local companies get a toehold in
Asian markets through its Asia Financial Support Center(67 regional banks as of March 31, 2018).
Regional Areas Genki Program
Facing the challenges of population constraints, severe
financial conditions, environmental restrictions and global
competition, Japan’s regions must coordinate with one
another and implement diverse regional development
schemes that capitalize on their respective strengths,
competitive advantages, and latent potential. In fiscal 2010,
DBJ arranged a unique initiative, the Regional Areas Genki
Program, to support regional growth that capitalizes oneach region’s respective strengths and potential from information and funding aspects. In addition, each DBJ branch
focuses on its region’s distinctive fields and businesses,
based on its industrial structure, and partners with regional
financial institutions to offer financial support.
Please click on the link to DBJ’s website for information about
support coverage in the areas of each branch (Japanese only).
https://www.dbj.jp/service/finance/area/
Integrated Report 201829

Corporate Data

Assisting Regional Financial Institutions with BusinessFeasibility Studies
Working with regional financial institutions, DBJ provides
support to the clients of regional financial institutions forassessing the feasibility of businesses that propose solutions
for solving management issues. Based on an analysis ofmacroeconomic conditions and individual companies, DBJ
engages in fact-finding to identify management issues atclients, and then presents its findings in an easy-to-understand format. DBJ subsequently comes up with various
financial solutions to solve the identified issues to help its
clients formulate their own growth strategies and drum up
business. Employees dispatched from regional financial
institutions are given opportunities to gain knowledge
through on-the-job training while performing businessfeasibility studies of the clients of their own bank. In 2017,

Kansai Branch

Risk Management

Collaborative Funds with Regional Financial
Institutions
DBJ collaborates with regional financial institutions withcustomer bases in their own regions to take advantage of
their networks and knowledge in order to advance thesupply of risk capital, including through preferred sharesand subordinated loans, to local companies. Through these
activities, DBJ aims to address diverse regional issues, suchas business succession, moving into growth fields, and therevitalization of local economies, while responding toemerging social needs against a backdrop of changing
demographics.
In fiscal 2017, DBJ created new funds with The Hokuriku
Bank, Ltd. and The Shizuoka Bank, Ltd. As of March 31,
2018, DBJ has created 30 collaborative funds with regional
financial institutions.

Tokai Branch

Corporate Governance

Oita Representative Office

DBJ Group’s Strategy

Aomori Representative OfficeToyama Representative Office

Area Strategy

Provision of Knowledge about Local Issues
Green Infrastructure
DBJ has published a research report entitled “DBJ Workshop
on Green Infrastructure for Rebuilding Urban Frameworks
Report: Proposal for Sustained Urban Renewal with GreenInfrastructure.”
Green infrastructure is designed to increase greeneryin urban areas and replace certain functional aspects of
conventional infrastructure in terms of disaster preparedness and the environment. Attracting attention in recent
years, green infrastructure enhances the appeal of cities
and increases sustainability. It is expected to help alleviate
financial burdens while updating infrastructure.
DBJ created the DBJ Workshop on Green Infrastructure for
Rebuilding Urban Frameworks, chaired by Associate Professor
Takanori Fukuoka from the Tokyo University of Agriculture,and invited President Takashi Onishi of the Toyohashi
University of Technology as an advisor as well as Distinguished
Professor Shiro Wakui from Tokyo City University and others
as leading experts to the workshop. Discussions covered
several topics related to facilitating green infrastructure insociety. The work group’s report outlines the discussions
undertaken by the experts and suggests ways to implement
green infrastructure in society based on their discussions.
Smart Venues and Estimations of Economic Scale ofSports Industry
In conjunction with the Smart Venue Workgroup (Chair:
Professor Yoshiyuki Mano from Waseda University Facultyof Sport Sciences), DBJ published a research report titled“Creation of Sports-Oriented Communities with Smart
Venues®—Multi-Function Facilities as Venues for Community
Exchange.” A smart venue is defined as a sustainable facility for exchange that includes multiple functions, including
management of neighboring areas. The report estimatesthat more than ¥2 trillion will be spent over the next 20
years on modernizing and building new stadiums andsports arenas, and recommends turning them into smart
venues that also function as spaces for exchange.
In the joint research paper “Estimation of Economic Scaleof Japan’s Sports Industry” with Doshisha University, DBJ
estimates the economic scale of the sports industry was ¥6.6
trillion in 2011. In “the Future Investment Strategy 2018,”
it is written that, with the cooperation of DBJ, the government will examine methods to estimate the size of the sports
market on an ongoing basis in a format that facilitates international comparisons. DBJ will continue to research andstudy the sports industry, which is likely to grow in the future.
Please click on the link below to see the Regional, Industry andEconomic Report on DBJ’s website (Japanese only).
https://www.dbj.jp/investigate/etc/index.html

30Integrated Report 2018

Collaboration with Local Governments
Initiatives in PPP/PFI and Public Asset Management
via Collaboration with Local Governments andRegional Financial Institutions
Local governments are directly dealing with issues, such asaging, related to public assets under their management.
Public asset management refers comprehensively to theplanning, management, utilization, and disposal of assets
from a management perspective. DBJ assists numerous
local governments in this regard, helping them create plansand draw up individual projects with Group think tanks.
In June 2013, DBJ set up PPP/PFI Promotion Centers tofacilitate collaboration with local governments and regional
financial institutions. While planning and holding seminars
at the PPP/PFI Academy, DBJ offers regional platforms forcooperating at the national level. In these and other ways,
DBJ has made a concerted effort to expand the use of PPP/
PFI, putting into place a structure for promoting their use.
In particular, the PPP/PFI Academy encourages roundtablediscussions and the sharing of case studies through a teleconference system that connects all of DBJ’s bases. In its
seventh year, the PPP/PFI Academy has welcomed a cumulative total of 6,000 people as participants.
DBJ is keen to supply risk capital and support the formation of pioneering businesses through research and advisory
services for properly advancing various PPP/PFI projects
tailored to regional issues and situations, based on collaboration with the national government, local governments,
private companies, and regional financial institutions.
Advisory Services on Comprehensive Government
Policies for Matsudo City
DBJ received a request from Matsudo City for help creatinga collaborative framework with a broad range of experts inmeasuring investment effectiveness from the business planning and proposal stages, evaluating effective and efficient
operating methods, and providing insight into the management of private companies. In July 2017, DBJ signed acomprehensive partnership agreement and advisory service
contract for consultations on the collaborative framework.
The main advisory services provided by DBJ entailed
advice, research, and analysis of the impact on city financesfrom the implementation of various projects, including
calculating the effectiveness of investments in projects tocreate communities, as well as the viability and the optimal
approach for executing individual projects.
With this advisory agreement, DBJ will help Matsudo City
achieve its aim to develop community management models
from a private-sector perspective by leveraging its knowledge and network accumulated in PPP/PFI and public asset
management, as well as various solutions including project
financing.

DBJ Group’s Vision

Case Study

Business Rehabilitation at Miyazaki Car Ferry

Corporate GovernanceRisk Management

Message from Employees

DBJ Group’s Strategy

Miyazaki Car Ferry Co., Ltd. operates a long-distance ferry service on routes
between Miyazaki and Kobe. The company also transports trucks that deliveragricultural products from around Miyazaki Prefecture to the Kansai, Chukyo,
and Tokyo regions. Agricultural produce must be reliably delivered by the next
day to Tokyo and other regions. The company has key transportation infrastructure for meeting tourist demand from the Kansai region.
However, the company’s two ferries have been in service for over 20 years andneed replacing. Although the company has reliably generated a certain level ofprofit, Miyazaki Car Ferry has large amounts of debt inherited from its predecessor, making it a challenge to raise funds.
In light of these circumstances, DBJ, along with local companies, financial institutions, and local governments in
Miyazaki Prefecture, in addition to the Regional Economy Vitalization Corporation of Japan, provided the financing
needed to rehabilitate Miyazaki Car Ferry and restart operations as a new company.
The rehabilitation of Miyazaki Car Ferry will not only keep people employed at the company but also keep in service its
ferry routes that are a lifeline for the economy of Miyazaki Prefecture, enabling the reliable shipment of regional products. After restarting as a new company, Miyazaki Car Ferry is now working to improve earnings and its governancestructure while drawing up specific plans to introduce new ferries, satisfying its initial objective. DBJ has dispatched amanager to serve as an outside director at the company to keep their dialogue going. Leveraging its networks andresearch and analysis capabilities, DBJ is providing the company with a complete solution to its problems while helping
it improve management and draw up plans for the future.

Corporate Data

Supporting All of Miyazaki with Ferry Services Essential
to the Regional Economy

The business rehabilitation of Miyazaki Car Ferry was unique in that it involved asupport structure for all of Miyazaki with the establishment of Miyazaki Car Ferry as
a new company by a diverse range of stakeholders, including users of the ferry
service, local governments, and financial institutions.
This unique structure underscores the broad base of support Miyazaki Car Ferryhas gained from numerous stakeholders, reflecting the essential nature of its ferry
services for the regional economy. However, the diverse range of stakeholders has
meant that it is necessary to find common ground while engaging with the many
people involved.
Looking ahead, these diverse stakeholders will need to get behind the company as it addresses issues, including business
improvements and plans to introduce new ferries, and by marshaling the advantages offered by each stakeholder, thecompany will be able to take on future challenges. DBJ intends to support business improvements and help the company
manage its stakeholders.

Publication of DBJ BOOKs
Working as a unified group, DBJ has published the results of its surveys and research activities in a variety of fields
through various report brochures and professional journals. DBJ recently published DBJ BOOKs with the aim of
deepening the understanding of the latest topics and specialized fields among its broad readership.
In fiscal 2017, DBJ published its first round of two books, titled “Reforming Management of Waterworks—
Advanced Shape of Wide Area and Public–Private Partnerships (PPP/PFI)” and “Highlights of Tourism DMO Design
and Operation—Genuine Tourism Stimulus with DMO and Regional Revitalization.” DBJ plans to turn them into
a series.

Integrated Report 201831

Area Strategy

Priority
Areas

Self-Reliance and Revitalization of
Local Economies

Industrial revitalization based on regional characteristics,
overseas business development, response to inboundtourism, business succession

Overseas Positioning overseas operations within its sector strategies andfunction strategies, DBJ Group engages in global operations in
sectors providing high added value.

Outline
DBJ engages in overseas operations in line with its sector
strategies and function strategies. To coordinate these operations, it has subsidiaries in London, Singapore, and Beijing(including a branch office in Shanghai), as well as a representative office in New York.

Longer-Term External Environment and Social Issues
Based on projections for continued growth in the world
economy, DBJ Group is likely to see continued demand for
global business development from its core customers indomestic industries. At the same time, demand for capitalshould increase strongly from the infrastructure and transportation sectors against a backdrop of population growth
and the increasing volumes of movement in people andphysical goods. It is imperative that Japan’s economy andindustry sustain growth by effectively tapping into theseoverseas growth opportunities.
Strategy
DBJ will continue to engage in overseas operations in linewith its sector strategies and function strategies.
1) In infrastructure fields such as energy and transportation,
DBJ will provide investments and loans for the overseas
development of Japanese industry and for projects thatbring overseas knowledge to domestic markets.
2) DBJ will provide investment and advisory services tosupport the overseas industrial expansion needs of its
customers, including customers headquartered regionallyin Japan.
3) Group companies will manage investments in infrastructure assets and corporate assets for the purpose ofproviding Japanese investors with investment opportunities overseas.

32

Integrated Report 2018

Accomplishments and Initiatives to Date
When it first became a joint-stock company, DBJ began toextend corporate loans in developed countries where it
could apply its knowledge of industries in Japan. DBJ thengradually diversified into project finance, asset finance, andinvestment operations as business foundations were laid
overseas in accordance with DBJ Group’s sector strategies
and function strategies.
In Singapore and China, DBJ set up an M&A advisory
team to coordinate with the head office’s Business
Development Department in meeting the M&A needs ofcustomers in the Asian region.
Initiatives in fiscal 2017 included participation in syndicated loans for an airport in the United Kingdom, investment in a PPP project for a toll expressway in the UnitedStates, participation in syndicated loans for the leading
Singaporean company in the LPG carrier industry, the acquisition of bonds issued by a Chinese airline company on the
TOKYO PRO-BOND Market, and participation in an oil andgas floating production, storage, and offloading (FPSO)
project at a Japanese company that is destined for gas
fields off the shores of Ghana. Using a variety of financing
methods, DBJ promoted projects in a broad range ofsectors, countries, and regions.

DBJ Group’s Vision

Case Study

Participation in Natural Gas Power Plant Project (Hickory Run Project)in Pennsylvania, U.S.A.
DBJ Group’s Strategy
Corporate Governance

Planned construction site

Risk Management
Corporate Data

DBJ was the coordinating lead arranger for project financing
totaling U.S.$53 billion for the Hickory Run Power Plant that is
to be constructed in Pennsylvania in the United States.
The power plant, located near Pittsburgh, Pennsylvania, is anominal 1,000 megawatt (MW) natural gas-fired combined cycle
power plant with a planned commercial operation date of April
2020. When completed, the electricity will be sold on the PJM
Energy Market, the largest wholesale power market in North
America. In the U.S., the shale gas revolution has spurred theconstruction of new natural gas-fired power plants and thediscontinuation of older coal-fired power plants. Whencompleted, the power plant is expected to greatly contributeto the area by providing efficient, clean, and reliable power.
Tyr Energy, Inc., a U.S. subsidiary wholly owned by ITOCHU, isthe largest investor in the project, and has driven it forward whileleveraging its operational know-how in the development andconstruction of the power plant. Kansai Electric Power Co., Inc.
is also participating as a major investor. Through its involvementin power generation projects in the U.S., which leads in deregulation of the electric power sector, DBJ is able to acquire knowledge related to finance in deregulated markets that is useful inthe overseas business development of Japanese companies. DBJ
aims to use this knowledge for the benefit of Japan’s rapidly
deregulating electric power market.

Power plant under construction

Tapping into Growth in Southeast Asia for Japan—Initiatives at DBJ Singapore Limited
Since becoming a joint-stock company in 2008, DBJ Group has engaged in overseas operations in order to help Japanesecompanies develop business overseas and stimulate capital markets in Japan. In December 2008, DBJ Singapore Limited
was established as its first overseas subsidiary and its main base of operations for emerging markets in the Asia-Pacificregion. DBJ Singapore works closely with DBJ Group companies in Japan to provide investments, loans, and M&A advisory services in this region.
In the wake of the global financial crisis triggered by thecollapse of Lehman Brothers, emerging countries in Asia havecontinued to grow strongly, and Japanese companies havebeen expanding investments in the promising markets of thisregion. DBJ Singapore helps Japanese companies enter thesemarkets and provides investments and loans in Asian countries
to meet funding demand in the energy, transportation,communications, and other fields.
In its 10th year since being established, DBJ Singapore willcontinue to work with members and help customers develop
businesses while meeting diverse needs in Asian countries thatare key to the future growth of Japan.
Integrated Report 201833

Function Strategy

Special Investment 
Operations / Crisis
Response Operations
DBJ will provide optimal financing solutions tailored to customer needs,
from loans to mezzanine financing and investments, while reinforcing
its ability to adequately evaluate various risks.
Outline
DBJ provides loans and investments after analyzing businessprospects, evaluating risks, and creating financing schemes.
Taking into consideration the traits of each project and theintentions of participants, DBJ specializes in an integrated
investment and loan model that flexibly deploys loans,mezzanine financing, and investments.

DBJ’s Initiatives to Supply Risk Capital
Gas Company, Ltd. As of March 31, 2018, a total of ¥260.0
Special Investment Operations
billion in investments and loans had been extended toSpecial Investment Operations, established as an intensive
62 projects.
but temporary scheme to supply growth capital* from theperspective of promoting the competitiveness of JapaneseSpecial Investment Operations follows policy objectives,
enterprises along with regional revitalization, draws only ain accordance with the law, complementing and encouragportion of the investment (industrial investment) from theing private-sector enterprises and ensuring appropriate
Japanese government, enough to encourage the privatecompetitive relationships. To improve the structure of
sector to supply growth capital. In June 2015, DBJ kicked
Special Investment Operations and thereby maintain objecoff Special Investment Operations with risk capital for thetive evaluation and supervision of activities, an advisory
overseas independent power producer business of Shizuoka
body to the Board of Directors was established—the Special

Other financial
institutions

Capital account(megabanks, regionalbanks, private funds, etc.)

Investment(¥129 billion in
fiscal 2018)

Japanesegovernment(industrial
investment)

Provision(¥129 billion in
fiscal 2018)

Special Investment
Operations(Managing loans in
special account)
Fiscal 2018: ¥258 billion

Evaluate/inspect

Special Investment
Operations
Monitoring Board

34

Loans,
etc.

Integrated Report 2018

Complement andencourage private-sector
enterprises(including pump-priming)
Provide capital(including preferred sharesand subordinated loans)

Target company initiatives• Initiatives for effective use ofmanagement resources• Initiatives to promotemanagement innovation– Cultivate new business– Form alliances among
various sectors and groups

Policy objectives• Encourage self-reliant
development of regional
economies• Increase competitiveness ofJapan and domestic
enterprises• Develop markets for
growth capital

Enhance risk capital supporting growth

DBJ

* According to the Japanese government’s Study Panel Concerning the Promotion of
Expanding Growth Funding, certain financial institutions, including DBJ, are expected toserve in a pump-priming capacity for the foreseeable future to attract private-sector
investment by cultivating new capital providers, markets, and investors, thereby fostering
the development of an investment cycle led by the private sector.

DBJ Group’s Strategy

Case Study

Acquisition of Shares in National Car Parks Group, the United Kingdom,
through Joint Investment with Park24

Corporate Governance

DBJ acquired shares in National Car Parks Group, the United Kingdom’s largest
private parking lot operator, as part of a joint investment with Park24 Co., Ltd., theworld’s largest parking lot operator (by number of sites) as well as the operator ofJapan’s largest car-sharing service.
The acquisition provided Park24 with solid business foundations in the United
Kingdom that will enhance its position as a global player. Because the deal also helped
increase Japan’s international competitiveness in the parking lot business, DBJ was able to
NCP parking lot, U.K.
utilize its Special Investment Operations to acquire shares in National Car Parks Group.
Operating under the slogan “People, Cars, and Communities,” Park24 is contributing to the development of travel infrastructure services in Japan through its efforts to create a comfortable automobile
society. The company accelerated its overseas development in January 2017 with the acquisition of Secure Parking
Group, a parking lot operator focused on Asia and Oceania. In addition to providing assistance in financing as a joint
investor, DBJ is supplying Park24 with complementary resources accumulated in travel infrastructure financing in Japanand overseas and making investments in individual companies. DBJ hopes that the active support from these resources,
which include expertise, personnel, and information networks, will help maintain and extend National Car Parks Group’s
competitive edge and thus increase Park24’s corporate value.

Risk Management
Corporate Data

Case Study

Joint Investment in Singaporean Company with Chudenko
When Chudenko Corporation acquired shares in Singaporean electricalengineering contractor RYB Engineering Pte. Ltd., DBJ Group made a joint
investment by acquiring shares issued by the acquisition SPC.
Chudenko is a comprehensive facility engineering firm supporting thestable supply of electric power in the Chugoku region. In its medium- tolong-term vision, which outlines what Chudenko hopes to achieve as anorganization by the time it celebrates its 80th anniversary in 2024, thecompany is aiming to actively expand its group presence beyond the
Chugoku region into other regions of Japan and overseas. Chudenko is seeking to grow its business domain with aview to raising corporate value.
RYB Engineering has built up its business with a focus on design and installation for data centers with demand forhigh technology, gaining a strong reputation in Singapore. The owner was looking for participation from a sponsor
with growth capabilities as it sought to expand its business.
Chudenko’s first overseas acquisition gives it a base for business in Southeast Asia, a market notable for its pace ofgrowth, and is a spur for overseas development and company growth.
DBJ Singapore Limited was responsible for establishing connections between Chudenko and RYB Engineering.
DBJ Group provided support for Chudenko in the form of financial advisory services from its Business Development
Department, while its Chugoku Branch supplied risk capital through Special Investment Operations, thus assisting inraising the international competitiveness of Chudenko and Japanese industry.
More information about Special Investment Operations, including our initiatives, is on the DBJ website(https://www.dbj.jp/service/invest/special/index.html).
Integrated Report 2018

DBJ Group’s Vision

Investment Operations Monitoring Board—with participationfrom outside experts in financial and capital markets, industry, and other professional groups (see page 58).

35

Function Strategy

Crisis Response Operations
DBJ’s Crisis Response Operations function as a stabilizing
force during periods of instability in the economy, society,and markets.
Crisis Response Operations, on the basis of the Japan
Finance Corporation Act (Act No. 57 of 2007, including
later revisions) consist of the provision of necessary funds

during such crises as disruptions in domestic or overseas
financial markets or large-scale disasters. In response tocrisis-related damage, Japan Finance Corporation provides
two-step loans as a complementary risk measure, among
other measures, to government-designated financial institutions (designated financial institutions) that supply necessary funds to address crisis damage.

Crisis Response Operations Scheme
Japanese Government• Capital contribution• Lending of funds• Interest subsidies

DesignatedJapan Finance Corporation

Two-steploans, etc.

(Crisis Response Facilitation Account)

Designated financial institutions
Private financial institution•	Prepares and announces “crisis response facilitation guidelines”(approved by the competent minister)•	Implements complementary risk and other measures on the basis ofagreements (approved by the competent minister) with designatedfinancial institutions

Private financial institution
Private financial institution

Defines a new scope for DBJ’s responsibilities,

DBJ

making Crisis Response Operations obligatory for• Designated financial institutions conductbusiness in accordance with the Crisis
Response Operations Rules (based on
approval of the competent minister).

an indefinite period• Extends the scope of Japanese government recapitalization securing
DBJ’s financial structure, etc.
• Establishes a new crisis response reserve account, reflecting this obligationin the Articles of Incorporation, and indicates mandatory Japanese government ownership of more than one-third of shares and other measures• Designated financial institutions conductbusiness with complete double checks ofrequired compliance at their financing
departments and their departments
responsible for crisis response operations.

Note: Capital increases related to Crisis Response Operations before the 2015 revisions
to the DBJ Act were transferred from capital to a crisis response reserve(¥206.5 billion). Capital increases for Crisis Response Operations after therevisions are to be added directly to the crisis response reserve.

Provision offunds, etc.

Clients

36

Integrated Report 2018

DBJ Group’s Vision

Accomplishments and Initiatives to Date
2008/10

2008/122011/3

Earthquake Disaster Crisis Response Operations(through March 31, 2011)

Main events that were
designated a crisis:•	Turmoil in international ­financial markets(Global financial crisis)•	Damage from heavy rainfall during
typhoon #18 in 2015

Total funds raised by the government in Crisis Response Operations(as of March 31, 2018)¥206,529 million

Total crisis countermeasure loans, loans with loss guarantee agreements, andcommercial paper purchases as of March 31, 2018:

Corporate Governance•	Great East Japan Earthquake•	Kumamoto earthquakes
in 20162018/3Financial Crisis Response Operations
and Earthquake Disaster Crisis
Response Operations

DBJ Group’s Strategy

Commenced Crisis
Response Operations
as a designatedfinancial institution• Loans: ¥6,216.1 billion (1,149 projects)•	Loans executed with loss guarantee agreements: ¥268.3 billion(47 projects, including those slated for application to Japan Finance Corporation)• Commercial paper acquisitions: ¥361.0 billion (68 projects)

Risk Management

Case Studies

Kumamoto earthquakes in 2016

In the fiscal 2011 supplementary budget passed in thewake of the Great East Japan Earthquake, ¥2.5 trillion
was earmarked for Japan Finance Corporation for Crisis
Response Operations targeting medium- and large-sizedenterprises. DBJ proactively provided assistance for clientsaffected both directly and indirectly by the disaster.
Along with designated financial institutions in thedisaster area, DBJ arranged the Great East Japan
Earthquake Reconstruction Fund, which has financed 56
reconstruction projects to date.
In December 2014, in response to the shift of thestage of earthquake reconstruction from the restorationof production facilities (the “restoration stage”) to efforts
to open up a new enterprise-based market that resumes
production, collaborates among multiple enterprises toboost industry competitiveness, builds infrastructure andreinforces functions (the “reconstruction and growthstage”), we have established a new reconstruction andgrowth support fund in collaboration with the Regional
Economy Vitalization Corporation of Japan. The newfund is aimed at providing subordinated loans andpreferred shares to enterprises whose businesses arecontributing to the reconstruction and growth of thedisaster-stricken region. We are promoting forwardlooking initiatives with a nationwide business model,
aiming to support regional growth and revitalization.

In 2016, DBJ established the Kumamoto Recovery Officewithin the Kyushu Branch to better provide useful knowledge and financial expertise for the restoration andreconstruction of regions affected by the Kumamoto
earthquakes.
In July 2016, DBJ formed the Kumamoto Reconstruction
Support Fund jointly with the Higo Bank, Ltd. and theKagoshima Bank, Ltd., financial institutions in the­disaster-stricken area. The fund supplies risk capital,
through such schemes as senior loans (repayment in fullon maturity, uncollateralized, non-guaranteed loans) andsubordinated loans, to businesses affected by the disaster.
Additionally, DBJ provided beneficial information about
restoration and reconstruction through a cross-­
departmental system, and offered survey and planning
services in conjunction with related local governments,
national institutions, and economic groups, as well as
local financial institutions.

Corporate Data

Great East Japan Earthquake of 2011

Kumamoto Castle, damaged by the earthquakes(photo from the Ninomaru Parking Lot)

Integrated Report 201837

Function Strategy

Syndication, Advisory,
Consulting Services
DBJ mobilizes tie-ups and collaboration to provide syndicated loans andsupport for M&A designed to promote Japanese companies’ growthstrategies and strengthen their international competitiveness, andoffers impartial consulting with a long-term perspective. Alongwith related services, this helps clients solve the problems they
face and stimulates activity in financial markets.

OutlineSyndication
DBJ utilizes its impartial standpoint to call on a wide rangeof financial institutions in providing high-value-added syndicated loans that draw on such original DBJ financing products as DBJ Green Building Certification and the Regional
Areas Genki Program.
Advisory Services
DBJ offers expert advice related to corporate M&A—ranging
from the formulation of strategies, screening of acquisition
candidates, and assessment of corporate value to negotiations, structure policy, and post-merger integration assistance—for a variety of situations, including industry
restructuring, overseas business development, businessdomain expansion, business succession, and fund investments and exits.
Research & Consulting
Utilizing its extensive network of connections to universities, research institutions, experts, national governments,and local governments, DBJ provides support throughsurveys and problem-solving ideas related to business strategies and policy formation for urban development, regional
development, social capital maintenance, energy, the economy, and industry.
Strategy and Initiatives to Date
Syndication
Activities have included leveraging DBJ’s strengths in syndicated loans in the energy sector and reinforcing ties andpartnerships with regional financial institutions throughsuch means as business cooperation agreements for syndicated loans. In this way, DBJ is contributing to corporate
fund-raising while also providing financing opportunities
for financial institutions.

38

Integrated Report 2018

In fiscal 2017, DBJ and The Hiroshima Bank, Ltd. createda loan with a special provision that all or a portion of theprincipal amount borrowed would be waived in the eventof a major earthquake that met pre-determined conditions.
Both parties provided a syndicated loan using this instrument.
Advisory Services
As a result of its impartiality, DBJ has a wide network tomobilize in its advisory services, including not only Japanesefirms but also foreign companies and private equity funds.
In September 2017, when DBJ entered into an overseas
M&A advisory business cooperation agreement with BDA
Partners (headquartered in New York)—which needed todevelop business in Asia and other parts of the world—thesynergies generated between BDA’s overseas network and
DBJ Group’s M&A advisory organization and domestic andoverseas networks produced a more effective and efficient
overseas M&A advisory service for the client.
Research & Consulting
Japan Economic Research Institute, Inc. is a comprehensive
think tank that conducts research in the public, solutions,and international fields. In the public–private partnershipand project finance initiative fields, it has a top-class trackrecord in Japan backed by unparalleled experience andknow-how.
Value Management Institute, Inc. is also a comprehensive
think tank that excels in analysis using proprietary economic
models and insight into cutting-edge technologies. Its
highly specialized knowledge encompasses a broad rangeof policy fields, including the formulation of integrated
strategies for local governments across Japan.

DBJ Group’s Vision

Case Study

Proposal of ¥2 Billion Syndicated Loan for Tisco Logistics Corporation to
Build Distribution Warehouse with Head Office Functions
DBJ Group’s Strategy
Risk Management
Corporate Data

Message from Employees

Corporate GovernanceTisco Logistics Corporation is a road haulage operator headquartered in Yamagata
Prefecture. Its main area of operation outside of Yamagata Prefecture extends
from Tohoku to Kanto. Tisco Logistics has moved into third-party logistics (3PL),
taking over functions such as storage and inventory management from shippers
due to the trend in the logistics industry toward small lots and high-frequency
deliveries fueled by the growth of the e-commerce market and increasing
Rendering of the completed warehouse scheduled forconstruction
sophistication in inventory management. As a result of regional growth indemand for 3PL, Tisco Logistics wanted to build a distribution warehouse withhead office functions.
To this end, the Kirayaka Bank, Ltd., which is Tisco Logistics’ main bank andhas a business cooperation agreement regarding syndicated loans with DBJ,
consulted with DBJ. To finance the warehouse Tisco Logistics wanted to build,
DBJ and Kirayaka Bank proposed a ¥2 billion syndicated loan and a ¥200 million
preferred stock placement for strengthening the company’s balance sheet. In
addition to joint arrangers Kirayaka Bank and DBJ, eight companies participatedin the loan, the majority of which were regional financial institutions in
Yamagata and Miyagi prefectures. They included Shoko Chukin Bank, The Yamagata Bank, Ltd., Yamagata Shinkin Bank,
The 77 Bank Ltd., The Shonai Bank, Ltd., and The Sendai Bank, Ltd.
The ¥200 million of preferred stock issued by Tisco Logistics was taken up by the Jimoto Fund (a core business assistance fund investment limited partnership), created by DBJ together with Kirayaka Bank and Sendai Bank, which are
subsidiaries of Jimoto Holdings, Inc.
DBJ aims to assist in upgrading the functionality of regional logistics infrastructure through integrated investments andloans for local growth companies that support regional logistics.

Regional Financial Institutions Cooperating toSupport a Local Growth Company
DBJ became involved after it was approached for consultation by Tisco Logistics’
main bank, Kirayaka Bank. Fund-raising was an issue to begin with, in part
because a large-scale investment of more than ¥2 billion was required. However,
DBJ and Kirayaka Bank wanted to support the company’s president in his desire
to develop a logistics business that plays a part in regional economic stimulationand held many discussions on how to proceed.
DBJ and Kirayaka Bank conducted a joint assessment of Tisco Logistics’ business potential and arranged for an injection of ¥200 million from the Jimoto Fundto put the balance sheet on a firm footing for large-scale investment. Given that
Tisco Logistics was a local growth company supporting regional logistics, we also
thought it would be ideal to have regional financial institutions unite to provide
assistance; therefore, we embarked on our first jointly arranged syndicated loan.
Due to the many financial institutions and experts such as lawyers and accountants involved, it took time to construct the plan and reconcile the various interests, but all went well.
We are confident that the funding plan based on DBJ’s integrated investment
and loan approach provided a local growth company with funds that will contribute to boosting the company’s competitiveness and enhancing the functionality ofregional logistics infrastructure.

Integrated Report 201839

Function Strategy

Asset Management
Backed by the DBJ Group philosophy and comprehensive financial
expertise, DBJ Asset Management Co., Ltd. (DBJAM) provides
investment and asset management services that meet clients’ bestinterests.
By stimulating the flow of funds and appropriately addressing
diverse investment needs, DBJAM aims to spur the development of
capital markets in Japan.

Outline
DBJAM is an asset management company thatspecializes in investments in the real estate,
private equity, and infrastructure fields.

• Real estate• Private equity• Infrastructure

Longer-Term External Environment and Social Issues
Japan is a nation with considerable assets, including over
¥1,700 trillion in household financial assets and ¥200 trillion
in pension assets. With the Japanese economy confronted
by a declining population and an aging society, it is imperative that this wealth (financial assets) is steadily expanded.
In realizing sustainable asset formation for the nation, it
is an extremely important policy issue for Japan to have ahealthy and efficient capital market. Financial institutions,pension funds, and other institutional investors must also
advance their investment capabilities in order to maintaina vibrant capital market.
DBJAM acknowledges the importance of such policy
objectives and believes that its services are well alignedwith the public interest.
Strategy
DBJAM, as a fiduciary investment manager, works in thebest interest of its institutional investor clients with the aimof achieving longer-term growth in returns on each investment, being aware of the profits flowing to the ultimate
beneficiaries. DBJAM also works to help its clients increase
their asset management capabilities.
To achieve these aims, DBJAM develops deep understanding of the financial standings, investment policies, andrisk/return preferences of its clients through active, thorough, and faithful engagement.
DBJAM believes that such an attitude allows it to provide
investment and asset management services that are truly
optimized for the client.
40

Integrated Report 2018

Through these services and operations, DBJAM contributes to the development of financial markets in Japan byenergizing new money flows, as well as the conversionof fund flows into reliable asset formation for thenation’s citizens.
Accomplishments and Initiatives to Date
DBJAM was established in November 2006 for the purposeof energizing the real estate finance market in Japan. Since
then, DBJAM has provided domestic real estate fundmanagement and asset management services. In 2016, it
formed and began asset management in DBJ Private REIT
Inc., an unlisted private real estate investment trust. In
addition, since 2013, DBJAM has begun to providing discretionary investment services and investment advisory services
related to alternative investments in overseas/domestic
private equity and infrastructure and overseas real estate.
In its efforts to seek out and provide investment opportunities, DBJAM has set up seven co-investment programs
targeted at regional financial institutions and foreign
private equity funds as of July 2018. In 2018, Japan’s
Government Pension Investment Fund appointed DBJAM as
an investment manager focusing mainly on Japanese
infrastructure.
As a result of these activities, DBJAM had ¥1,155 billion
in assets under management as of March 31, 2018.

DBJ Group’s Vision

Case Study

New Stimulation for the Real Estate Finance Market with Private REIT
DBJ Group’s Strategy

DBJAM established DBJ Private REIT Inc. in August 2016 to cater to diverse
investment needs by providing high-quality investment opportunities to entities
such as regional financial institutions and pension funds from an impartial andlong-term standpoint. One objective of the establishment of DBJ Private REIT
was to energize the real estate finance market.
DBJ Private REIT takes full advantage of DBJ Group’s extensive experience inurban and regional development and its wealth of expertise in real estate securitization, including REITs, in aiming for stable longer-term earnings and steady
growth in assets under management.
DBJ Private REIT is distinguished by a basic policy of investment in properties
with DBJ Green Building Certification or other environmental certifications topromote sustainable real estate. In 2017, DBJ Private REIT led the way in the private REIT
sector thanks to its being awarded a Green Star (highest designation) in the Global Real
Estate Sustainability Benchmark (GRESB) assessment.* Investment in sustainable real estateand property management guided by sustainability fit with current investor interest in environmental, social, and governance (ESG) issues while also leading to the maintenance andenhancement of asset value in the longer term.

Corporate GovernanceRisk Management* GRESB, established in 2009 by leading European pension fund groups, undertakes annual assessments that take into account realestate sector ESG performance.

Corporate Data

Message from Employees

Harnessing the Overall Power of DBJ Group in Private
REIT Management

DBJ Private REIT currently has the funds of more than 70 investors, including financial institutions and pension funds,
under management. We believe private REITs are suited to long-term investors due to their ability to potentially generate
longer-term, stable income gains commensurate with fundamental real estate value by virtue of their non-listed, indefiniteperiod, open-ended structure. Private REITs are entrusted with the funds of professional investors (institutional investors)
and are required to perform to a high standard in real estate acquisition and management and in fund-raising. Furthermore,
as private REITs are predicated on being going concerns forindefinite periods, it is particularly important that they earn
the unwavering trust of investors over the long term.
Our employees, with distinct responsibilities in property
acquisition, fund-raising, property management, and DBJ
Private REIT management, will continue working together tobuild a track record of stable management and stable dividends.
And equipped with investment opportunities and services thatdraw on DBJ Group’s long-term perspective and impartiality,
they will engage in close communication with investors andparticipate in DBJ initiatives regarding ESG and sustainability
to maintain a customer-first approach in stable investment.

Integrated Report 201841

Management Foundation Strategy

Financial Capital
We target sustainable growth by constructing an
optimal risk–return portfolio while maintaining andstrengthening a robust financial base that supports
our unique business activities, including integrated
investment and loan services.

Basic Policy
Financial capital is a vital element of our business foundation implementing advanced business strategies centeredon our sector strategy (see page 18) and function strategy(see page 34) under the Fourth Medium-Term Management
Plan. A robust financial foundation of funds and capital isnecessary for DBJ Group to execute its sector strategy,
supply risk capital, and engage in Crisis Response

External
environment
Scenarioplanning

Operations. We aim to maintain and strengthen our financial capital by managing it within the context of a risk
appetite framework based on sophisticated analysis of risks
and returns with due consideration paid to regulatory capital (management focused on shareholders’ equity ratios)and economic capital (management of capital using stresstests).

BusinessstrategyStress test

Business plan

Execution

Monitoring

Strategy for
financial capital

Financial Soundness Indicators
Issuer ratings
Common equity Tier 1 risk-weighted capital ratio

42

Integrated Report 2018

A1 (Moody’s), A (S&P), AA (R&I), AAA (JCR)
16.8%

(As of March 31, 2018)(As of March 31, 2018)Issuance of SRI bonds(As of March 31, 2018)$1 billion in 2017$500 million in 2016€300 million in 2015€250 million in 2014

Capital Procurement (Non-Consolidated)(¥100 million)

Fiscal 2015

Fiscal 2016

Fiscal 2017

3,027.7
634.4
300.0
200.0
134.3
395.3
358.2
1,639.7

4,012.6
1,127.7
800.0
150.4
177.3
497.1
861.5
1,526.1

3,153.4
922.7
580.0
150.2
192.5
535.8
589.5
1,005.0

Corporate Data

Funds raised (flow)
Fiscal Investment and Loan Program
			 Of which, borrowings from FILP*			 Of which, government-guaranteed bonds (domestic)
			 Of which, government-guaranteed bonds (overseas)
Corporate bonds (FILP bonds)
Long-term debt
Of which, recovered, etc.

* Borrowings from FILP in fiscal 2016 included ¥500 billion in the supplementary budget for “economic stimulus measures for investments in the future.”

Message from Employees

Risk Management* The Green Bond Principles (GBP): GBP arecomplied by the International CapitalMarket Association (ICMA), investors, issuers, and securities companies. These partiesare responsible for updating annually the Green Bond Principles, which are voluntary
process guidelines that recommend transparency and disclosure and promote integrityin the development of the green bond market by clarifying the approach for issuance ofa green bond. These parties also create a platform to share the latest information about
green bonds and send relevant information to society.

Corporate GovernanceGreen Bond Guidelines, 2017.
DBJ will continue to support
the sustainable growth of thismarket by continuing to issue
SRI bonds as well as proactively engaging in international and domestic initiatives.

DBJ Group’s Strategy

DBJ Socially Responsible Investment Bond (SRI Bond)
In 2014, DBJ became the first issuer in Japan to issue agreen bond. Also, DBJ has issued a DBJ Sustainability Bondeach year since 2015; DBJ’s $1,000 million issuance in fiscal
2017 was the largest sustainability bond ever issued by aJapanese issuer. The raised funds are allocated toward thecreation of a sustainable society through DBJ Green
Building Certification and the Environmentally Rated Loan
Program. Information on the management and allocationof funds is evaluated by third parties to increasetransparency.
In January 2017, DBJ became an issuer member, the firstJapanese firm with an issuer status, of the Green Bond
Principles* and in March 2017 participated on a committee
created by the Ministry of the Environment to draw up the

DBJ Group’s Vision

Specific Initiatives to Improve the Value of Financial Capitalprocurement activities with diversified maturities and methA pillar of DBJ Group’s business strategy is to provide longods. DBJ has been issuing green bonds and sustainability
term financing for infrastructure projects. To do so, DBJ
bonds since fiscal 2014. The issuance of these bonds has not
Group procures long-term funds through corporate bonds
only diversified our fund procurement base but also invigoand the Fiscal Investment and Loan Program (FILP). In recent
rated the socially responsible investment (SRI) bond market.
years, DBJ has stably procured funds through FILP as well as
by issuing corporate bonds, thereby augmenting its fundSpreading Understanding of DBJ’s Principles and Workthrough IR Activities

In addition to procuring funds through the Fiscal Investment and Loan Program (FILP) and government-guaranteed bonds, DBJ
conducts its own credit-raising activities, such as issuing corporate bonds (FILP bonds) and borrowing money from regional
financial institutions. When conducting its own credit-raising activities, DBJ places emphasis on having investors understand andsupport its principles and work and, to facilitate that, dispatches representatives to conduct proactive IR activities in all regions ofJapan and overseas.
Amid rising global interest in environmental, social, and governance (ESG) investment,
DBJ aims to broaden the investor base for sustainability bonds—one of its distinctive fundprocurement methods—by introducing the unique activities of the Environmentally Rated
Loan Program and DBJ Green Building Certification and spreading understanding of thesustainability management activities of DBJ Group as a whole.

Integrated Report 201843

Management Foundation Strategy

Reference (Long-Term Profits / Losses, Financial Conditions)2008

2008–2010

Became ajoint-stock company

First Medium-Term Management Plan:
CHALLENGE 2010

Fiscal 2008

Consolidated(October 1, 2008 to
March 31, 2009)(Six-month fiscal period)

Fiscal 2009

Fiscal 2010

(April 1, 2009 to
March 31, 2010)(April 1, 2010 toMarch 31, 2011)

Total income

151.2

347.9

345.1

Income before income taxes(121.6)

51.9

95.0

N/A

(26.7)

(2.9)

3.5

(0.8)

9.3

Income before income taxes and minority interests(118.1)

51.1

104.3

Total income taxes(13.5)(10.8)(1.3)

Net income attributable to owners of the parent(128.3)

39.8

101.5

—

10.0

50.0

Total assets

14,028.0

15,595.7

14,845.2

Loans

12,008.8

13,514.6

13,031.4

Securities

1,246.5

1,289.4

1,165.5

Total liabilities

11,941.6

13,268.2

12,435.2

Borrowed money

8,067.8

9,082.4

8,576.4

Debentures and corporate bonds

3,513.0

3,746.3

3,629.3

Total equity

2,086.4

2,327.5

2,409.9

Common stock

1,000.0

1,181.1

1,181.1

Total capital ratio (Basel II, BIS standard)

18.87%

19.13%

20.50%

Total capital ratio (Basel III, BIS standard)

—

—

—

Ratio of risk-monitored loans (Banking Act basis)

1.60%

5.07%

1.28%

Return on assets (ROA)(0.92)%

0.27%

0.67%

Return on equity (ROE)(6.06)%

1.82%

4.31%

Number of employees

1,096

1,181

1,203

1,733.4

3,793.1

2,116.6

1,670.3

3,682.0

2,034.4

63.1

111.1

82.2

1,733.4

3,793.1

2,116.6

184.3

840.9

1,212.8

Of which, equity and fund-related gains/losses
Extraordinary profit/loss

Total dividend amount

Investment and fundraising flow (non-consolidated)
Loans and investments (flow)
Loans
Investments
Funds raised (flow)
Of which, recovery, etc.

44

Integrated Report 2018

2014–2016

2017–2019

Second Medium-Term Management Plan:
Endeavor 2013

Third Medium-Term Management Plan:
Supporting Japan’s Sustained Growth as a Global Innovator

Fourth Mid-Term
Management Plan

Fiscal 2012

Fiscal 2013

Fiscal 2014

Fiscal 2015

Fiscal 2016

Fiscal 2017

(April 1, 2012 toMarch 31, 2013)(April 1, 2013 toMarch 31, 2014)(April 1, 2014 toMarch 31, 2015)(April 1, 2015 toMarch 31, 2016)(April 1, 2016 to
March 31, 2017)(April 1, 2017 toMarch 31, 2018)

318.7

340.0

361.6

339.0

358.6

285.4

291.7

99.2

115.6

165.7

153.0

185.1

122.5

127.1

(1.3)

30.0

30.3

32.1

70.8

41.1

39.7

10.9

0.6

0.2

0.6

1.5

(0.0)

2.2

110.2

116.2

166.0

153.6

186.7

122.4

129.4

(31.9)(44.5)(40.8)(58.9)(57.6)(34.6)(35.0)

77.3

71.3

124.3

92.7

128.9

87.6

91.9

37.3

35.2

30.8

22.5

29.2

19.7

22.1

15,579.8

16,248.7

16,310.7

16,360.6

15,907.1

16,570.4

16,952.2

13,645.4

13,918.2

13,838.4

13,261.3

12,952.5

13,039.5

12,725.2

1,176.6

1,357.0

1,637.5

1,887.9

1,803.0

1,750.3

1,866.4

13,118.8

13,710.1

13,682.9

13,613.3

13,022.9

13,584.2

13,842.1

9,170.5

9,448.3

9,182.6

8,598.2

7,892.1

8,472.3

8,574.1

3,671.8

3,924.5

4,237.4

4,569.3

4,727.9

4,711.8

4,932.9

2,461.0

2,538.5

2,627.7

2,747.2

2,884.2

2,986.2

3,110.1

1,187.7

1,206.9

1,206.9

1,206.9

1,000.4

1,000.4

1,000.4

18.56%

—

—

—

—

—

—

—

15.52%

15.83%

16.80%

17.87%

17.47%

16.94%

1.47%

1.23%

0.99%

0.77%

0.64%

0.54%

0.47%

0.51%

0.45%

0.76%

0.57%

0.80%

0.54%

0.55%

3.18%

2.86%

4.83%

3.47%

4.60%

2.99%

3.03%

1,270

1,315

1,391

1,407

1,435

1,546

1,631

2,927.0

2,652.4

2,943.3

2,544.2

3,027.7

4,012.6

3,153.4

2,849.0

2,524.5

2,805.1

2,262.7

2,861.3

3,805.8

2,973.6

78.0

127.8

138.2

281.4

166.3

206.7

179.7

2,927.0

2,652.4

2,943.3

2,544.2

3,027.7

4,012.6

3,153.4

691.7

502.2

1,307.5

1,129.9

1,639.7

1,526.1

1,005.0

Corporate GovernanceRisk Management
Corporate Data

Integrated Report 2018

DBJ Group’s Strategy

Fiscal 2011
(April 1, 2011 toMarch 31, 2012)

DBJ Group’s Vision(¥100 million)

2011–201345

Management Foundation Strategy

Human Capital
We aim to become a “human resource development bank”
with diverse human resources, and help employees develop
skills while raising their motivation.

As of March 31, 2018

Number of employees(consolidated)

1,631

Number of employees(non-consolidated)

1,182

Average length of service(non-consolidated)

14.4 years

Basic Policy
To steadily implement DBJ Group’s value creation process,which aims to create both economic and social value, andto realize Vision 2030, our vision for our future, it is imperative for us to nurture excellent employees who can implement the distinctive business models of DBJ Group,
including its integrated investment and loan services.
Furthermore, we think it is important to create structuresin which employees will be highly motivated. Improving thevalue of human capital is identified as one of the mostimportant themes under the Fourth Medium-Term
Management Plan and DBJ is taking concrete steps toachieve this goal.

Human Resource Development Vision
DBJ’s role has evolved and developed substantially to meetthe needs of the times. DBJ considers such innovation
crucial to maintaining its leadership position in theconstantly advancing field of finance.
To develop its all-important human resource assets,
DBJ encourages autonomous and pioneering behavior inits employees as financial professionals in keeping withthe vision of “generalists who can be specialists in many
fields.” While it is important to acquire specialist knowledge, responding to society’s constantly changing demands
also requires broad experience, deep knowledge, and theability to see the big picture. We continue to build a wide
variety of systems based on this philosophy.

Career Development
Vision for Human Resources
Human resources who realized theintegrated investment and loan services
business model

Human Resource Development System
On-the-job training andtraining in accounting
and financial analysis
Inheriting the DNA that
DBJ has developed overmany years“Generalists who can be
specialists in many fields.”(Employees with specialized knowledge
in a wide range of fields)

Promoting a deep
understanding of our visionand the sharing of our values

Strategic personnel
rotation
Financial solutions
Skills development
programs
Cultivating the ability toprovide high-level solutions,
responding to the needs of
new business domains,and fostering industry
professionals“Human Resource Development Bank”

46

Integrated Report 2018

Overseas study,
seconding,and dispatch(to DBJ Group companies,
government agencies, etc.)
Gaining a broad perspective
and range of knowledge
Strengthening our networkof human resources

DBJ Group’s Vision

Message from the Head of the Human Resources Management Department

All-Important Human Resources
All work comes down to a test of human capacity. That is
why DBJ focuses on fostering human capacity more than ondeveloping financial skills to be utilized in individual jobs.
To foster this human capacity, we rotate our employees,
especially those aged in their 20s, roughly every two years
so that the experience they gain in multiple jobs in different
departments and workplaces allows them to develop a
broad base of specialist knowledge in the field of finance.
At DBJ, our policy is not to rush in creating this knowledge
base but instead to build it steadily and carefully.
Recently, the number of overseas investment projects
involving Japanese and foreign companies has increased,
and accordingly DBJ is focusing on developing its global
human resources. In addition to sending young employees

DBJ Group’s Strategy

to study as trainees or overseas students, DBJ has worked
with overseas business schools to establish its own educational programs. In the future, we hope to allow an increasing number of young employees opportunities to benefit
from the experience of overseas study programs.
DBJ has made a commitment as an organization to takea long-term view in the development of human resources
who realized DBJ’s integrated investment and loan services
business model by offering employees various work andoverseas experience as well as a wide range of training
opportunities.

Corporate GovernanceTsutomu Murakami

Executive Officer,
Head of Human Resources Management Department• In offering practical experience, dispatch employees tocentral government agencies, Group companies in Japanand overseas, and companies in which DBJ has invested• When hiring new graduates, provide extensive, year-longtraining through new employee training programs,
including DBJ’s accounting and financial analysis training,which is roughly three months

2017 Training Program Schedule for New Employees (Regular Employees)
April

May

June

July

AugustSeptember

October

Early April to mid-April

Early July

Early OctoberIntroductory training

Finance training

Mid-April to mid-June

Businessknowledge
training

Accounting and financial analysis training

Mid-July(business etiquette, communication, and PC and other training)

November

October and November

English-language training

Legal training• DBJ provides abundant opportunities for training throughcombinations of rank-based, business-related, and selfimprovement training.
Established the Minami Aoyama Training Center and otherfacilities to provide concrete support for human resource development as well as qualitative and quantitative strengthening ofintangibles in the areas of career development, management
ability, and global awareness.

New employee training

Minami Aoyama Training Center

Integrated Report 201847

Corporate Data

(2) Skills Development
DBJ conducts human resource development across theGroup by providing employees with practical on-the-job
training and ample other training opportunities.
• Strategically rotate employees so they steadily develop
highly specialized skills by gaining practical experience inmultiple departments

Risk Management

Specific Initiatives to Increase the Value of Human Capital(1) Intensification of the Hiring and Exchange of Human Resources across DBJ Group
DBJ will strengthen its hiring processes and practices and
DBJ will also work to further disseminate the DBJ Groupsecure the personnel necessary across the entire Group to
Vision 2030 and its value creation process by strengthening
implement its sector strategy, function strategy, and area
the exchange of human resources across DBJ Group.
strategy.

Management Foundation Strategy

Human Resource Training Program
Training for new employees
Rank-based

Management / leadership

Career development / management /leadership

Career Development Program

Strategic human resource development through job rotationand on-the-job training

Proposal ability

Front office

Screening ability

Finance

In-house
training

Work skills

Functional department
Management department

Financialaccounting

Legal

Corporate finance, etc.

Middle/Back office
Shared skills

Domestic
Dispatchoutside DBJ

Strategic global human resource development
Overseas

Self-study

Knowledge
and skills

Logical thinking / facilitation / presentation, etc.

Seconding to Group companies and outside institutions
Overseas university strategic partnership programs /Short-term study in top business schools / Overseas study /Trainee programs / Seconding to overseas institutions, etc.
Language study / Finance / Law / Accounting•	In order to develop global human resources, DBJ has created a robust system that allows employees to study overseas at
graduate schools and as trainees. Through a strategic partnership with the University of Oxford, DBJ has also created its
own leadership program, conducted completely in English, for young employees.
Partnership Program with the University of Oxford• A three-month leadership program (completely in English) independently created by DBJ
based on a strategic partnership with the University of Oxford• Program conducted by Jonathan Trevor based on the unique theory of Strategic Alignment• Approach to the strategic partnership with the University of Oxford in addition to thisleadership program(3) Motivation and Health Management• Increase motivation by conducting employee engagement surveys, considering survey results, developing action plans ineach department, and implementing improvement measures• In addition to periodic health checkups, introduce counseling services staffed by external professionals as a part ofmanagement that cares for the physical and mental well-being of employees
Diversity Management and Workstyle Reforms
Employees come together to work tirelessly to promote• In addition to enhancing work and leave systems forworkstyle reforms based on new ways of thinking, improvechild-rearing and elderly care, DBJ holds “iku-boss” seminars
productivity by reevaluating work processes, create systems
for management to support employees using these systems
that take into account work-life balance, and create organizaand seminars to assist in finding childcare facilities withtional structures wherein a diverse range of people can thrive.
enrollment capacity. DBJ also conducts career training andimplements training and other measures aimed at creating• Training aimed at into the reduction of overtime work:
an environment that is supportive of these initiatives.
Throughout the year, DBJ promotes improvement inwork efficiency by selecting model departments, holding• Set targets for empowering women, specifically for hiring
workshops, implementing concrete measures to reduce
women and promoting them to management positions
workloads, and spreading know-how gained from these• Proactively hire people with disabilities, maintain workmeasures across DBJ.
environments for diverse human resources
48

Integrated Report 2018

Training and Measures to Support Child-Rearing Systems

91%

Rehiring system (Number of registrants as of the endof fiscal 2017)27

Female Employee: I am currently raising two children and taking advantage of the reduced work hours after returning from childcare leave. Just
after 8:00 a.m., I take my children to childcare on my bicycle and arrive at
the office at 9:25 a.m. I finish work at 4:40 p.m., shop at the supermarket,
and then pick up my children from childcare. Because my time at work islimited, I try to focus and work efficiently and I receive support from myteam, with whom I share work responsibilities. Thanks to this arrangement,
I am able to lead a fulfilling life. Also, when one of my children suddenly
becomes ill, I can make full use of the child sick leave program and the policy
allowing annual paid leave to be taken in hourly units. I think employees
rearing children truly appreciate having these various systems in place.
Male Employee: I took a month’s childcare leave after the birth of my second child. The fact that I was able to focus onhousekeeping and child-rearing during the very difficult time immediately after the birth was not only important to myfamily but also a valuable experience that broadened my perspective. I was busier than expected during this time and,on many days, before I knew it, it was time to pick up my children at childcare. After going through this valuable, albeit
hectic, experience, I hope more men decide to take childcare leave so that they can have a similar experience. Even after
returning from leave, I was able to drop off and pick up my children from childcare and help out when they suddenly
became ill by taking my annual paid leave in hourly units and working from home. I am very thankful for this fulfilling
working environment.

Integrated Report 2018

49

Corporate Data

Employee Interviews

Risk Management• As a result of these efforts, DBJ not only achieved a highratio of employees returning to work after taking childcare leave, but all employees not returning to work after
taking childcare leave cited a spouse’s job transfer as thereason for not returning and are registered in the rehiring
system. Therefore, in effect, all employees taking childcare
leave expressed the desire to return to work, if possible.
• A total of nearly 100 employees have taken advantage ofprograms allowing reduced work hours after returningfrom childcare leave or the flextime system, and DBJ
encourages employees to make use of systems that suit
their needs.

Seminars on Finding Childcare Facilities
Since 2017, DBJ has been hosting seminars to assist in
finding childcare facilities with enrollment capacity. In
response to the situation of children who have been put
on waiting lists for childcare facilities, which has becomea serious issue in many of the cities in Japan where our
employees work, and to support employees returning towork after taking childcare leave, we provide information
on career development to employees who are considering having children and to assist DBJ employees and theirspouses in finding childcare. We host lectures by outside
experts and share the experiences of people who have
faced such issues. These informational programs are
aimed not only at employees and their spouses who aresearching for childcare facilities but also at managers
with subordinates in this situation. As of 2018, a totalof nearly 100 employees have attended these lectures.

Corporate GovernanceRatio of employees returning to work after taking
childcare leave (Number of employees having
completed childcare leave in fiscal 2017)“Iku-Boss” Training
DBJ has been conducting “iku-boss” training since 2014.
The aims of this initiative are to deepen understanding of
DBJ’s robust systems to support childbirth and childrearing and to promote understanding by managers ofsubordinates making use of the childcare leave andreduced work hours systems through case studies as well
as seminars presented by outside experts. As of March
31, 2018, a total of 200 employees have participatedin this training. In fiscal 2018, “iku-boss” training was
designated a mandatory program for young management candidates.

DBJ Group’s Strategy• In addition to maintaining systems to enable female
employees to work actively in a variety of departments
over a long period of time even as they navigate important life events such as marriage and childbirth, DBJ
conducts a variety of different types of training andimplements various support measures to create a workplace environment wherein use and understanding ofthese systems are promoted.

DBJ Group’s Vision

Employees’ Use of Childbirth and Child-Rearing
Support Systems

Management Foundation Strategy

Intellectual Capital
DBJ aims to build on strengths in knowledge, the wellspringfor value-added operations such as research, analyses, and risk
management, as well as strengths in frameworks, including
processes, information and communication technology (ICT)systems, and organizations.

Basic Policy(1) Knowledge
We strive to improve skills as a core element of operations
necessary to differentiate our business model throughsurveys, research, analyses, and risk management centeredon industry.
(2) Processes
We will improve operations, including via investments in
ICT, by clarifying and simplifying business processes fromthe customer’s standpoint in order to rapidly and properly
address customer needs.
Specific Initiatives to Improve the Value ofIntellectual Capital
Knowledge
Improving Screening Capabilities and Proposal Abilities
In order to continue carrying out its mission while engaging
in high-risk operations such as integrated investment andloan services and crisis response, DBJ Group must maintainexcellence in not only industry analysis but also its capabilities to evaluate corporations and businesses. To increase thecorporate value of DBJ’s customers, we also strive topropose improved solutions that leverage DBJ’s capabilities
and unique characteristics.
Industry Analysis
The role of the Economic & Industrial Research Department is
to analyze and disseminate information on economic andindustrial trends in Japan and overseas, including macroeconomic trends and trends in key industries, and to support
investment activity. DBJ proactively works to accumulate anduse intellectual capital, including information on recent trends
in such areas as big data, AI, computer-assisted software
engineering (CASE), virtual/augmented reality, and fintech.
In April 2017, DBJ established the post chief research
officer and placed under it the Economic & Industrial
Research Department and the Sustainability Planning &50

Integrated Report 2018

Support Department. We provide knowledge-based solutions to customers in various industries, including solutions
from the perspectives of environmental, social, and governance issues and the Sustainable Development Goals(SDGs), based on our wide-ranging knowledge of industry.
For details, please follow the link below to the DBJ website.
https://www.dbj.jp/en/investigate/

Capital Investment Planning Survey
With a history of more than 60 years (since 1956), DBJ’s
Capital Investment Planning Survey looks at trends incorporate capital investment in Japan as well as corporate
activities based on the “broad definition of investment,”
including capital investment overseas, and spending on
R&D, M&A, and human resources. The results of the survey
are used for many purposes, such as furthering education
at universities and research at R&D organizations, in addition to serving as a reference for national economic policy
and corporate planning.
Cross-Sector Conference
Cross-sector innovation is accelerating and the number ofthemes that must be analyzed by industrial surveys isincreasing. Against this background, to pursue deep industry
knowledge while maintaining a cross-sector perspective, DBJ
Group set up the Cross-Sector Conference in fiscal 2017 asa platform for sharing information among the Economic &Industrial Research Department, business offices, and Group
companies. To discover and share cross-sector knowledge,
we convened the Cross-Sector Conference nine times infiscal 2017 with such themes as CASE, logistics, andhealthcare.
Research Institute of Capital Formation
The Research Institute of Capital Formation (RICF) wasestablished in 1964 with Dr. Osamu Shimomura, who advocated for the principles behind Japan’s post-1940s, higheconomic growth, as its first executive director. The institute(¥100 million)

1,250

2,000

(Left axis)(Right axis)

Environmental rating
Cumulative amount

BCM rating

Health management rating
137

1,000
107

Total number of
rated loans:

750

45

1,073
¥1,853.3 billion

500

17
4

250
33
0

(Fiscal year) 2004

67

2005

11

103

1

(As of March 31, 2018)

13

100

126

2006

2007

19
162

2008

23
198

2009

28

55

369

145
415

75
234

278

190
470

523

574

1,600

315
1,200
621
800

308

400

244

2010

2011

2012

2013

2014

2015

2016

2017

Integrated Report 2018

051

Corporate Data

(Number)

Risk Management

DBJ Rated Loans

Corporate Governance

DBJ Certification Programs
rating loans is revised every year by a panel of advisors
Using its independently developed screening system, DBJ
consisting of external experts with due attention paid tocertification programs set terms and conditions of loans
the latest issues and trends around the world.
based on corporations’ non-financial information.
Evaluations of the sustainability of corporations’ activities
In February 2018, DBJ received a commendation fromcontribute to practical implementation of the Plan‐Do‐
the Association of Development Financing Institutions in
Check‐Act (PDCA) cycle. Also, by factoring non-financial
Asia and the Pacific (ADFIAP) in recognition of its efforts
information into the assessment of corporate value, DBJ
through the Employees’ Health Management Rated Loan
aims to create an environment wherein companies with
Program. DBJ certification programs provide broad support
medium- to long-term growth potential can be evaluatedfor the efforts of its customers while contributing to theby financial markets and stakeholders.
creation of a sustainable society.
DBJ launched the Environmentally Rated Loan Program in
Environmental
Health Management
2004, the first such program in the world. In 2006, DBJ
BCM Rating
RatingRating(Business
continuationrisk)
launched the BCM Rated Loan Program to evaluate disaster(Environmental risk)(Human productivity risk)
preparedness and measures to ensure business continuation. Furthermore, in 2012 DBJ began to offer the
Employees’ Health Management Rated Loan Program,which assesses a company’s efforts at health management
to improve the productivity of its employees through workstyle reforms and measures to raise employee awareness ofhealth issues. To date, we have provided more than 900
For details on DBJ certification programs, please follow the link
below to the DBJ website (Japanese only).
rated loans to customers while engaging in dialogue withhttps://www.dbj-sustainability-rating.jp/
them to support their initiatives. Our screening sheet for

DBJ Group’s Strategy

Processes
Work Reform Project
DBJ established the Work Reform Project in fiscal 2016
under the leadership of a deputy president and withmembers from a range of departments to devise measuresto raise added value for customers, including streamlining
investment and loan processes, increasing productivity,
vitalizing organizations, streamlining how meetings are
conducted, reviewing decision-making processes, setting up
a mobile work environment, introducing a video-conference system, and streamlining settlement procedures.

DBJ Group’s Vision

serves as a venue for creating intellectual capital throughcooperation and collaboration between DBJ and external
experts at universities and other organizations. Its research
includes a focus on the formation of a sustainable economy
and society from an academic and liberal standpoint. In
recent years, the institute has expanded the means for creating intellectual capital by establishing new committees forresearching sustainability, publishing research papers
through Springer, an international academic publishingcompany, and holding international academic conferences in
conjunction with foreign academic journals and think tanks.

Management Foundation Strategy

Relationship andSocial Capital
DBJ Group aims to create value by cooperating with other parties to enhance the value of its network and brand.
Its also aims to achieve sustainable growth in business andcorporate value while developing social capital forsociety as a whole.

Basic Policy
Relationship Capital
DBJ Group has built diverse networks with customers,
financial institutions, investors, and national and local
government agencies for the purpose of exchanging information and avoiding conflicts of interest. DBJ Group utilizes
its unique networks to identify issues affecting the economy and society and to conduct investment and loan operations. We aim to maintain our reputation and improve ourbrand value through the services we provide to customers.
Social Capital
DBJ Group defines social capital as a resource shared acrosssociety that underpins the foundations of market economics. Increasing the value of social capital is a basic tenet forrealizing a sustainable society. DBJ specifically engages inunique initiatives within the context of (1) the natural environment, (2) social infrastructure, and (3) system capital.
Social capital(1)
Naturalenvironment

Details

Forests, mountains, rivers,
lakes, soil, air

Example of initiatives

Environmentally Rated
Loan Program
DBJ Green Building
Certification

Energy, transportation,
urban infrastructure,
Socialinfrastructure industrial value chains

Loans and investments forinfrastructure and industrial
projects
BCM Rated Loan Program

Stabilization and stimulationof the financial system,
System capital development and invigoration of financial markets

Crisis Response Operations
Supply of risk capitalSocially responsible
investing bond issuance

(2)

(3)

Concrete Measures to Increase the Value ofRelationship Capital and Social Capital
Universities and Research Institutions
DBJ uses its network of roughly 450 scholars at 116 universities in Japan and abroad to promote research activities
and human resource development, mainly in the social

52

Integrated Report 2018

science fields. From early on, we have worked to make thisnetwork a global one, launching a system to support overseas researchers in 1991 which now includes 38 overseas
researchers from 14 countries including the US, Canada,
the UK, Germany, France, Singapore, China, South Korea,
and Australia.
In fiscal 2017, we hosted the DBJ Sustainability
Conference with the theme of CSR, the Economy and
Financial Markets. Through this and other international
academic conferences, we deepen discussions between
global researchers and businesses such as DBJ and these
conferences have been well received as an opportunity forexchanges that take place in an environment different fromuniversities.
The DBJ Academy provides training to DBJ employees
and students from outside DBJ as part of our efforts tofoster human resources capable of conducting high-level
financial operations. In fiscal 2017, with the help of 18
outside instructors in various fields from 11 universities, wewere able to provide instruction to a total of 481 students.
Comprehensive Partnership Agreement with AISTIn September 2017, DBJ and the National Institute ofAdvanced Industrial Science and Technology (AIST) signed
a partnership agreement with the purpose of pursuing
open innovation to contribute to the construction of nextgeneration social and industrial infrastructure.
Through this partnership, private-sector companies are
given access to technologies developed by AIST so that they
can be commercialized. This arrangement assists corporations
working with DBJ Group in solving problems by using leading-edge technologies and encourages the launch of joint
development projects. Under the agreement, DBJ and AIST
plan to exchange information and hold discussions aimed atstrengthening communication with private-sector companies
and identifying good matches for collaborative projects.

For more information, please follow the link below to the DBJ
website (Japanese only).
https://www.dbj-i.net/jp

For more information, please follow the link below (Japanese only).
https://www.jeri.or.jp/wec/

DBJ Connect
Beginning in June 2017, at the suggestion of our young
employees, we launched DBJ Connect, a service promoting
open innovation collaboration between start-ups andestablished companies, in collaboration with Creww, acompany that operates the largest start-up community inJapan. The programs that DBJ Connect operates allow
start-ups to leverage the management resources of established companies to accelerate the growth of their businesses and offer established businesses a foothold into
emerging new businesses.

ADFIAPfinancing sustainable development

Approval of TCFD
In June 2018, DBJ expressed its approval of the final reporton the recommendations of the Task Force on Climaterelated Financial Disclosures (TCFD). Going forward, DBJ
will respond appropriately through scenario analysis basedon recognition of the risks and opportunities related toclimate change.
Integrated Report 2018

53

Corporate DataDISCLOSURE INSIGHT ACTION

Risk Management

Participation in Outside Initiatives
DBJ actively participates in and contributes to outside
initiatives aimed at promoting sustainability management.
For example, in December 2016, DBJ and DBJ AssetManagement Co., Ltd. became signatories of the United
Nations-supported Principles for Responsible Investment(PRI) and, since February 2018, have served as members of
the PRI Infrastructure Advisory Committee. Also, DBJ invited
Richard Howitt, chief executive officer of the International
Integrated Reporting Council (IIRC), to take part in an
exchange of views among businesspeople involved in integrated reporting. Further, DBJ joined the Global Real Estate
Sustainability Benchmark as an investor member and participates in study groups hosted by the Japanese Ministry of
Economy, Trade and Industry on long-term investment insustainable growth (ESG and investment in intangible
assets) and round table conferences held by the Japanese
Ministry of the Environment on ESG financing.

Corporate Governance

DBJ Women Entrepreneurs Center (DBJ-WEC)
DBJ provides comprehensive support, including entrepreneurial know-how and networking opportunities, tonurture growth businesses led by women from new
vantage points that could change society and the economy
for the better. As a part of these efforts, DBJ holds a business plan competition every year for women entrepreneurs.
New business ideas that evince excellent business potential
and innovativeness are awarded business grants of up to¥10 million. After the competition finishes, the winners areconnected with outside experts and venture capitalists who
help them turn their business plans into reality by supporting the growth and development of their business ideas.
In addition to the DBJ Women Entrepreneurs Prize, the
DBJ Women Entrepreneurs Prize for Excellence and the DBJ
Women Entrepreneurs Prize for Business Promotion, in 2017
DBJ created the DBJ Women Entrepreneurs Prize for Social
Design. DBJ presents these awards for high-utility sustainable plans that make strong contributions to society andcontribute to the solution of regional issues while taking
into consideration the Sustainable Development Goals (SDGs).
More than 2,100 business plans have been submitted
over the past six competitions, expanding the scopeof opportunity for women
entrepreneurs.

DBJ Group’s Strategy

For more information, please follow the link below (Japanese only).
https://www.jeri.or.jp/sctm/about/ihub.php

DBJ Connect’s first program was Kyoto Open Accelerator,
wherein four established companies based in Kyoto collaborated with six start-ups.

DBJ Group’s VisioniHub4.0 (innovation Hub4.0)
Along with Japan Economic Research Institute, DBJ engages
in the management of technology training and innovationiHub4.0 activities. By using its impartial position and broad network, DBJ
aims to resolve social issues throughlogical and innovative businesssolutions.

Corporate Governance

Message from the Chairman

With ongoing efforts to strengthen governance,
we contribute to sustainable growth throughan innovative value creation process.

1. Toward the Creation of a Unique Business ModelIn accordance with the Development Bank of Japan Inc. Act, DBJ Group promotes sustainability management that balances economic value with social value, with the aim of realizing a sustainable society. Under
the current Fourth Medium-Term Management Plan, DBJ supports forward-looking initiatives by supplying
risk capital through Special Investment Operations. These initiatives aim to stimulate new flows of risk
capital in Japan by collaborating and cooperating with private financial institutions. Through investments
and loans in new fields, DBJ contributes to the strengthening of Japan’s international competitiveness.
DBJ also supplies risk capital for addressing local issues through joint funds created with regional financial
institutions.
Furthermore, DBJ plays the role of rapidly supplying capital during responses to such crises as natural
disasters. During turmoil in international financial markets, the Great East Japan Earthquake, the Kumamoto
earthquakes, and other events that required fresh capital, DBJ has been there to rapidly provide relief.

2.	Governance Suitable for Our Business Model, andDialogue with Stakeholders
In order to continue playing this unique role, it is essential that DBJ has robust corporate governance,
ensures transparency in management, and takes into consideration the opinions of external experts. For
these reasons, DBJ has set up the Operations Audit Committee, Compensation Committee, and Personnel
Evaluation Committee as advisory bodies to the Board of Directors. Based on this framework, aiming toincrease the effectiveness of the Board of Directors, we believe it is also imperative to listen to the opinionsof our stakeholders.
In a reasonably competitive environment, it is very important for DBJ to collaborate and cooperate withprivate financial institutions, thus DBJ periodically creates events, usually twice a year, for exchanging opinions with representatives of such institutions. In addition, with regard to Special Investment Operations,
DBJ has set up the Special Investment Operations Monitoring Board (see page 58) as an advisory body to
the Board of Directors that meets twice a year in order to deliberate and evaluate projects, as well as
embolden private-sector enterprises and complement their operations while maintaining appropriatecompetitive relations.
The opinions elicited from the periodic social events with private financial institutions and the outcomesof deliberations by the Special Investment Operations Monitoring Board are reported to the Advisory Boardand debated. As an advisory body to the Board of Directors, the Advisory Board (see page 57) is made up

54

Integrated Report 2018

DBJ Group’s Vision
DBJ Group’s Strategy

August 2018

Yasushi Kinoshita
Chairman

Integrated Report 201855

Corporate Data

In 2017, DBJ Group created the Policy on Sustainability and the Sustainability Committee in light of theincreasing need to review corporate management from the standpoint of sustainability, given recent developments including the adoption of the Sustainability Development Goals (SDGs) and the Paris Agreement.
The Sustainability Committee has discussed matters that are important for management, such as constantly
changing social issues for the realization of a sustainable society, and in 2018, directors enthusiasticallyexchanged opinions about initiatives related to energy, climate change, and the SDGs.
DBJ Group aims to realize a sustainable society while balancing economic value and social value byoffering solutions to issues faced by society and the Group’s customers. DBJ will create innovative businessmodels for advancing sustainability management and maintaining a balanced value creation process.
Moreover, we will continue making every effort to ensure robust and effective corporate governance basedon the notion that nothing is more important than the trust placed in us by our customers and society.

Risk Management

3.	Realizing a Value Creation Process That Balances
Economic Value with Social Value

Corporate Governanceof outside experts and directors in fields including manufacturing, infrastructure, regional communities,
and finance. The Advisory Board provides valuable opinions about matters concerning the safeguardingof appropriate competitive relations with private financial institutions and DBJ Group’s management plans.
I believe a unique aspect of DBJ Group’s corporate governance is the continuous reassessment of its novel
value creation process while engaging in dialogue with stakeholders.
Moreover, to advance initiatives one step ahead of the times, it is important for DBJ to ensure the appropriateness of its operations based on the Companies Act. For this purpose, the Board of Directors formulated the Internal Control System Basic Policy, which positions legal compliance, risk management, andinternal audits as important issues for management.

Corporate Governance

Basic Position on Corporate Governance
DBJ is governed by the Development Bank of Japan Inc. Act (the DBJ Act) in accordance with the following objective.

Article 1
Development Bank of Japan Inc. (hereinafter referred to as the “Corporation”) shall be a joint-stock company (kabushiki-kaisha)
whose objective is to contribute to the smooth supply of funds to those needing long-term business funds, as well as to thesophistication of financial functions.
DBJ is working to enhance its unique governance system in
addition to usual management supervision as a company
with a board of directors and company auditors (Audit &Supervisory Board) through a business model built upon
features such as integrated investments and loans andproper execution of the preceding objective in order toraise the value of tangible and intangible management
resources to be invested and to realize sustainable management that aims for both economic and social value.
Specifically, the 2015 revisions to the DBJ Act establishedthe creation of Special Investment Operations and obligatory measures to be considered, requiring that DBJ conduct
its operations in a manner that does not obstruct appropriate competitive relations with other entities, in particular,
applying these requirements to the Advisory Board, madeup of outside experts and directors, and the Special
Investment Operations Monitoring Board, composed ofoutside experts, which function as advisory bodies to theBoard of Directors. These bodies provide advice on DBJ’s

overall management and deliberate and evaluate businessresults, including consistency with the policy objectives ofSpecial Investment Operations, ensuring that appropriatecompetitive relations are maintained with private financial
institutions.
DBJ’s Corporate Governance System
A company with a board of
directors and company auditors(Audit & Supervisory Board)

Institutional design configuration
Number of directors

10

Of whom are outside directors

2

Number of Board of Directors’ meetings
this fiscal year
Number of Audit & Supervisory Board
members
Of whom are outside Audit &Supervisory Board members
Number of Audit & Supervisory Board
meetings this fiscal year

13
5
3
14

Adoption of executive officer system

Yes
Deloitte Touche Tohmatsu
LimitedAccounting auditor

Overview of DBJ’s Corporate Governance System
General Meeting of
Shareholders

Matters requiring authorization ofcompetent minister ppointment and dismissal of representativeA
directors and Audit & Supervisory
Board members

Audit & Supervisory
Board members,
Audit & Supervisory Board

ReportingOperations Audit
Committee

Concurrent positions as directors
Amendments to Articles of Incorporation
Board of Directors

Disposition of surplus funds
Merger, corporate split, and dissolution

Compensation
Committee

Accounting auditor

ReportingInternal Audit
Department

Personnel Evaluation
Committee

Basic policy on business plans,
redemption plans, and fund procurement

Cooperation

Advisory Board
Executive
Committee
Decision-making
bodies

ALM & Risk
Management
Committee

Departments
Subsidiaries

56

Integrated Report 2018

AuditsSpecial Investment Operations
Monitoring Board

Deliberative
bodiesGeneral Risk
Management
Committee

Committee on
Investment and
Loan Decisions

New Operation
Screening
Committee

Advisory Panelon Investments
and Loans

Sustainability
Committee(new)Core Business
SystemRestructuring
Committee

Auditsduties. The Audit & Supervisory Board and Audit &Supervisory Board members audit the execution of duties
by directors, based on their audit policy and audit plans.
Audit & Supervisory Board members attend Board of
Directors’ and other important meetings and may query the
execution of business by directors, peruse documents, andconduct branch audits.

Advisory Bodies to the Board of Directors

Personnel Evaluation Committee
The Personnel Evaluation Committee, composed of outside
directors and other outside experts, evaluates personnel
proposals on the selection of directors and Audit &Supervisory Board members.
Advisory Board
Since DBJ’s establishment as a joint-stock company in
October 2008, the Advisory Board has been in place as anadvisory body to advise the Executive Committee, providing
advice on overall management. Revisions in 2015 to the
DBJ Act stipulate for an indefinite period obligatory

Outside Experts
Reiko Akiike

Senior Partner and Managing Director,
The Boston Consulting Group

Masayuki Oku

Honorary Advisor of
Sumitomo Mitsui Financial Group, Inc.

Kazuaki Kama

Executive Corporate Advisor,
IHI Corporation

Corporate Data

Compensation Committee
The Compensation Committee, whose members include
outside directors, considers the type of executive compensation structure that befits DBJ from the standpoint of
ensuring transparency and objectivity regarding
compensation.

Katsunori Nakanishi Chairman and CEO,The Shizuoka Bank, Ltd.

Yoshizumi Nezu

President, Tobu Railway Co., Ltd.

Outside Directors
Akio Mimura

Honorary Chairman of
Nippon Steel & Sumitomo Metal Corporation

Kazuo Ueda

Professor and Head of Office for New Department
Planning, Kyoritsu Women’s University,
Faculty of International Studies

Integrated Report 2018

Risk Management

Operations Audit Committee
The Board of Directors has established the Operations Audit
Committee, delegating to this body the authority to deliberate important matters related to internal audits. This
committee met two times during the fiscal year ended
March 31, 2018.

measures to be considered, in particular, requiring that DBJ
conduct its operations in a manner that would not obstructappropriate competitive relations with other entities.
Accordingly, this board is positioned anew as an advisory
body to the Board of Directors. As one of its roles, evenmore than before, the Advisory Board is tasked with deliberating and evaluating important affairs related to ensuringthat appropriate competitive relations are maintained withprivate financial institutions.
This board convened twice during the fiscal year ended
March 31, 2018. This board is composed of the following
outside directors and experts in fields including manufacturing, infrastructure, regional communities, and finance.

Corporate GovernanceIn pursuit of sustainability management and DBJ’s corporate
objectives, the following committees have been establishedas advisory bodies to the Board of Directors for the purposeof maintaining transparency in management and to reflect
the knowledge of outside experts.

DBJ Group’s Strategy

The Audit & Supervisory Board comprises five members.
The Companies Act prescribes that a majority of Audit &Supervisory Board members be outside members (in DBJ’scase, three of the five). DBJ offices contribute three members(two members proper to DBJ and one an outside member).
Also, DBJ has created the Audit & Supervisory Board
Office, which under the board’s direction, assists board
members, including outside members, in performing their

DBJ Group’s Vision

Audit & Supervisory Board Members, Audit & Supervisory Board

57

Corporate GovernanceSpecial Investment Operations Monitoring Board
One of the measures of the 2015 revisions to the DBJ Act
was in regard to Special Investment Operations. The act
stipulates the establishment of a Special Investment
Operations Monitoring Board as an advisory body to theBoard of Directors. This monitoring board is tasked withdeliberating projects and evaluating their performance interms of appropriateness against policy objectives and withemboldening private-sector enterprises and complementing
their operations while maintaining appropriate competitive
relations. This board, whose members include outside
experts in fields such as manufacturing, infrastructure,regional communities, and finance, convened twice during
the fiscal year ended March 31, 2018.
In order to examine whether appropriate competitive
relations with other entities are being maintained, roundtable discussions are held regularly with the Japanese
Bankers Association, the Regional Banks Association ofJapan, and the Second Association of Regional Banks,

including these entities’ private financial institution
members. Each group met twice in fiscal 2017, for a totalof six meetings. Disputes and opinions raised in these meetings are reported to and deliberated by the Advisory Boardand the Special Investment Operations Monitoring Board.
Outside Experts
Hideharu Iwamoto

Vice Chairman & Senior Executive Director ofJapanese Bankers Association

Masayuki Oku

Honorary Advisor of
Sumitomo Mitsui Financial Group, Inc.

Katsunori Nakanishi Chairman and CEO,The Shizuoka Bank, Ltd.

Takashi Yamanouchi Advisor,

Mazda Motor Corporation

Keisuke Yokoo

Vice Chairman & President ofJapan Association of Corporate Executives

Fumiaki Watari

Honorary Executive Consultant of
JXTG Holdings, Inc.

Executive Committee
The Board of Directors has vested in the Executive Committee decision-making authority regarding the execution of business.
Accordingly, the Executive Committee makes important management decisions. The committee met 38 times during the
fiscal year ended March 31, 2018.
Committees under the Executive Committee
Name

Role

ALM & Risk Management Committee

This committee deliberates and makes decisions pertaining to portfolio risk management and asset–liability
management.

General Risk Management Committee

This committee deliberates and makes decisions on important items related to operational risk management,
system risk management, legal compliance, responses to antisocial forces, client protection management, andother important items.

Committee on Investment and
Loan Decisions

This committee handles, deliberates, and makes decisions related to investments and loans, overseas businessstrategy, and operations and management conditions.

New Operation Screening Committee

This committee deliberates and makes decisions on the commencement of initiatives involving new businesses.

Advisory Panel on Investments
and Loans

This panel handles the advance deliberation on and monitoring of investments and loans as well as deliberations
on overseas business strategy and operations and management conditions.

Sustainability Committee

This committee deliberates on items related to both economic and social value as well as dialogue
with stakeholders.

Core Business System Restructuring
Committee

This committee deliberates items related to policies for restructuring core business systems.

DBJ established the Sustainability Committee, which has
operated since fiscal 2017 onward, as part of efforts tocontribute to a sustainable society, in accordance with DBJ
Group’s Policy on Sustainability (please refer to page 61).
This committee approaches important social issues from an
ESG perspective and incorporates this attitude into businessactivities, including investments and loans as well as asset
management.
The committee met twice during the fiscal year ended
March 31, 2018.

58

Integrated Report 2018

Matters Requiring Authorization ofCompetent Minister
The DBJ Act prescribes matters for which Minister ofFinance authorization is required. Major items requiringsuch authorization are as follows:•	Appointment and dismissal of representative directors
and Audit & Supervisory Board members•	Amendments to Articles of Incorporation•	Disposition of surplus funds; Merger, corporate split, anddissolution; Basic policy on business plans, redemption
plans, and fund procurement

Messages from Outside Directors

DBJ Group’s VisionCorporate Governance Helps Us Solve Social Issues
Akio Mimura
Outside Director

DBJ Group’s Strategy

April
April

1963: Joined Fuji Iron & Steel Co., Ltd.
2000:	Representative Director and Executive
Vice President of Nippon Steel Corporation
April
2003:	Representative Director and President of
Nippon Steel Corporation
April
2008:	Representative Director and Chairman of
Nippon Steel Corporation
October 2008: Director at DBJ (current position)
October 2012:	Director, Member of the Board andSenior Advisor of Nippon Steel &Sumitomo Metal CorporationJune
2013:	Senior Advisor of Nippon Steel &Sumitomo Metal Corporation
November 2013:	Chairman of the Tokyo Chamber ofCommerce & Industry (current position)
Chairman of the Japan Chamber ofCommerce & Industry (current position)
June
2018:	Honorary Chairman of
Nippon Steel & Sumitomo Metal
Corporation (current position)

Corporate GovernanceRisk Management

I have served as an outside director since 2008 when DBJ became ajoint-stock company, and I am currently a member of the Advisory
Board, a body that facilitates corporate governance by incorporating
the opinions of outside experts into the management of DBJ. The
Advisory Board is positioned as an advisory body to the Board of
Directors in accordance with the revisions of the DBJ Act of 2015. The
role of the Advisory Board is not only advising DBJ management forbalancing economic value and social value, but also deliberating for
DBJ to ensure appropriate competitive relations with private financial
institutions. I also believe that the Advisory Board has fulfilled its
responsibilities for performing checks from a third-party perspectiveon the proper execution of legally mandated Special Investment
Operations, Crisis Response Operations, collaboration with private
financial institutions, and DBJ Group management.
Amid rapid change in the economy, international politics, technology, demographics, and other aspects of society, DBJ aims to contribute to the resolution of various social issues while moving to achieve
the objectives of the Fourth Medium-Term Management Plan thathas been underway since fiscal 2017. To this end, it is essentialthat DBJ constantly engages in dialogue and cooperates with its stakeholders. As an outside director, I will continue to carry out my duties
and facilitate contributions to society from a governance standpoint.

Corporate Data

Strengthening Corporate Governance toPromote Sustainability Management
Kazuo Ueda
Outside Director

July
April
April
March
April
April
OctoberApril

1980:	Assistant professor at the University of
British Columbia, School of Economics
1982:	Assistant professor at Osaka University,
School of Economics
1989:	Assistant professor at Tokyo University,
School of Economics
1993:	Professor at Tokyo University, School of
Economics
1998:	Deliberative member of the Bank ofJapan’s Policy Board
2005:	Professor at Tokyo University, School of
Economics
2008:	Outside director at DBJ (current position)
2017:	Professor and Head of Office for New
Department Planning, Kyoritsu Women’s
University, Faculty of International Studies(current position)Director of Tokyo
University’s Center for Advanced Researchin Finance (current position)

Over the past few years, interest in social sustainability, expressedin terms including ESG and the SDGs, has risen sharply. To date, DBJ
has fulfilled various roles in accordance with the needs of society,constantly undertaking new initiatives for realizing a sustainable society, such as developing DBJ certification programs and supplying risk
capital through joint investments with private non-financial companies
and financial institutions.
I believe DBJ’s initiatives draw on the long evolution of its corporate
DNA to date, and proper governance is needed for DBJ to contributeto the medium- and long-term development of society and the economy, as well as to the realization of a sustainable society. This uniquebusiness model is supported by the Advisory Board and the Special
Investment Operations Monitoring Board. As a member of theAdvisory Board, I work closely with outside experts to advise DBJ on
overall management. I will do my part in pursuit of sustainable social
development and the sustainability management that DBJ strives for.

Integrated Report 201859

Corporate GovernanceInternal Control System Basic Policy
DBJ has established the following internal controls toensure operational soundness, with the Board of Audit,
Ministry of Finance, Financial Services Agency, and otherinstitutions also conducting examinations of overallmanagement.
Status of Internal Control System
In accordance with the Companies Act, the Board of
Directors has established an internal control system underthe Internal Control System Basic Policy. Specifically, thissystem is designed to determine the status of legal compliance, risk management, and internal audits, as well asother items of importance to management. The internal
control system is designed to confirm applicable regulations
and the status of their implementation in various
departments.
The full text of the Internal Control System Basic Policy is alsoavailable on the DBJ website (Japanese only).
https://www.dbj.jp/co/info/governance_policy.html

Internal Audits
DBJ has established the Internal Audit Department under
the direct supervision of the president of DBJ and independent of other operating departments. The department
conducts inspections to ensure the appropriateness andeffectiveness of internal controls, including overall operational compliance and risk management, and performs

evaluations and recommends improvements. The Operations
Audit Committee deliberates and decides audit plans, audit
reports, and other important matters related to internal
audits, and this information is reported to the Board of
Directors. As of the end of June 2018, 22 people belonged
to the Internal Audit Department.

Accounting Audits
DBJ has in place an agreement whereby Deloitte Touche Tohmatsu LLC conducts accounting audits as its accounting auditor.

Three-Pronged Auditing Approach
DBJ’s Audit & Supervisory Board members, the Internal Audit Department, and the accounting auditor periodically and asnecessary exchange opinions and information, and communicate in an effort to ensure effective and appropriate audits.

Compliance
DBJ recognizes compliance as one of its most importantmanagement issues. As basic policies to ensure that theexecution of duties by directors and regular employees
complies with laws and regulations and the Articles ofIncorporation, we have formulated a corporate philosophy,
a Basic Compliance Policy and other compliance-related
regulations. In addition to its basic regulations on compliance, DBJ has created and provided notice throughout theorganization of a Compliance Manual and a complianceprogram. We seek to thoroughly implement the complianceactivities outlined below.
Compliance Principles
DBJ has formulated the compliance principles indicatedbelow as part of its creation of compliance regulations.

60

Integrated Report 20181) DBJ’s executives and employees are keenly aware of DBJ’s
social mission and responsibilities as a public-sector bankand recognize that illegal acts or improper business operations harm the reputation of DBJ and interfere significantlywith DBJ’s ability to fulfill its objectives under the new
DBJ Act. We also realize DBJ’s need to always conduct
activities appropriately and in compliance with the law.
2) DBJ’s executives and employees are well aware that DBJ
must conduct its businesses legally and appropriately
and be responsible for explaining its actions to thegeneral public.
3) DBJ refuses all advances from anti-social forces andcooperates with police and other related institutions toprevent any sort of relationship with such elements.

internal system. One specific initiative is the establishmentof a compliance hotline.
The objective of this internal reporting system is to
swiftly identify and resolve any legal violations. DBJ is also
preparing Conflicts of Interest Management Regulations
as a basic policy in addition to systems to manage conflictsof interest.

We have incorporated a declaration on our policies into
our Declaration on Personal Information Protection.
DBJ is a registered financial institution under the
Financial Instruments and Exchange Act. In accordance withthis act and the Cabinet Office Ordinance on Financial
Instruments Business, etc., DBJ has drawn up a policy introduced for the management of conflicts of interest andprovides an overview of the publicly announced policy.

Policy on Sustainability
DBJ Group formulated the Policy on Sustainability in 2017 in order to facilitate the creation of both economic value and social
value while engaging in dialogue with stakeholders and effecting continuous improvement in the value creation process.

Responses to Japan’s Stewardship CodeIn August 2014, DBJ stated its acceptance of the “Principles
for Responsible Institutional Investors (Japan’s StewardshipCode)” (the “Code”). Under the Code, stewardship responsibilities refer to the responsibilities to enhance themedium- to long-term investment return for clients andbeneficiaries by improving and fostering investee enterprises’ corporate value and sustainable growth throughconstructive “purposeful dialogue” (engagement), basedon an in-depth understanding of the investee enterprises
and their business environments.
DBJ recognizes that, in addition to operational selection
and focus and the realization of growth strategies, calls forcorporate governance are growing. Recognizing the importance of the meaning of equity, in our equity investments
we support the long-term advancement of the investee
enterprises that are our clients, taking particular note of
their social responsibilities. When making investments, we
endeavor to gain an in-depth understanding of investee
enterprises, their business environments, and their management teams’ intention and to share with investee enterprisesin their long-term strategies. After investing, we leverage
our networks and strengths in information, industry
research, and financing technologies to provide total
financing solutions that address the issues they face.
Through dialogue with investee enterprises, we work torealize their long-term development and maximize theircorporate value over the long term.
DBJ believes that its investment operations have been
conducted in close affinity with the spirit of the Code.
In providing risk capital and knowledge, we consider theappropriate fulfillment of stewardship responsibilities byinstitutional investors to be of service from the perspectiveof working with diverse financial players to ensure thesmooth formulation of financial and capital markets.
Accordingly, we are in agreement with the meaning of theprinciples provided in the Code.
The full text, including the May 2017 revisions to the code, isavailable on the DBJ website (Japanese only).
https://www.dbj.jp/co/info/stewardship.html

Integrated Report 2018

61

Corporate Data

The full text of the Policy on Sustainability is available on the DBJ website.
https://www.dbj.jp/en/co/csr/regular/index.html

Risk Management

The Client Protection Management Basic Policy, Declaration on
Personal Information Protection, and Policy for Managing
Conflicts of Interest can also be found on the DBJ website(Japanese only).
https://www.dbj.jp/co/info/compliance.html

Corporate Governance

The establishment and maintenance of systems for client
protection management and the protection of personal
information are vital because doing so protects the people
who use the financial institution’s systems and raises theirlevel of convenience. DBJ recognizes the extreme importance of such systems from the standpoint of operationalsoundness and appropriateness. DBJ has formulated a
Client Protection Management Basic Policy to ensure strict
compliance with laws and regulations, protect the interestsof its clients, and raise the level of client convenience. We
have also created internal regulations based on this policy,
which we employ in briefings to raise in-house awareness.

DBJ Group’s Strategy

Client Protection Management Basic Policy / Declaration on Personal Information Protection /Policy for Managing Conflicts of Interest

DBJ Group’s Vision

Compliance System
DBJ has established the Legal and Compliance Department
to take overall responsibility for planning, preparing, andadjusting compliance activities. In addition, DBJ has established the General Risk Management Committee to reflect
on legal compliance matters, determine the extent ofcompliance, and deliberate on improvements to DBJ’s

Directors, Audit & Supervisory Board Members, and Executive Officers(as of the end of July 2018)

Directors
Chairman

Director and Managing Executive Officer

Yasushi Kinoshita

Koji Narita

1979: Joined the Ministry of Finance2013: Administrative vice minister
2015: Deputy President of DBJ
2018: Chairman of DBJ

In charge of Treasury Department,
Syndication & Credit Trading Department,
Sustainability Planning and Support
Department
1987:	Joined the Ministry of Finance2016:	Director-General of the Chugoku Local
Finance Bureaus
2017:	Director and Managing Executive
Officer of DBJ

President and CEO

Director and Managing Executive Officer

Hajime Watanabe

Makoto Anayama

1981:	Joined The Japan Development Bank
2008:	General Manager, Head of Urban
Development Department
2009:	Executive Officer,
Head of Corporate Planning &Coordination Department
2011:	Director and Managing Executive
Officer of DBJ
2015: Deputy President of DBJ
2018: President and CEO of DBJ

In charge of Accounting Department,
Credit Analysis Department,
Risk Management Department,
Legal Affairs & Compliance Department,
Research Institute of Capital Formation

Deputy President

Director and Managing Executive Officer

Shin Kikuchi

Seiji Jige

1984:	Joined The Japan Development Bank
2011:	Executive Officer, Head of Growth &Cross Border Investment Group
2011:	Executive Officer, Head of Corporate
Planning & Coordination Department
2013:	Managing Executive Officer of DBJ
2015:	Director and Managing Executive
Officer of DBJ
2018:	Deputy President of DBJ

In charge of Business Planning &Coordination Department, International
Strategy & Coordination Department,
Economic & Industrial Research
Department

Director and Managing Executive Officer

Outside Director

Satoshi Tomii

Akio Mimura

In charge of Strategic Finance
Department, Growth & Cross Border
Investment Department

Honorary Chairman of Nippon Steel &Sumitomo Metal Corporation;
Chairman of Tokyo Chamber ofCommerce and Industry;
Chairman of Japan Chamber ofCommerce and Industry

1985:	Joined The Japan Development Bank
2012:	Executive Officer, Head of Growth &Cross Border Investment Group
2014:	Managing Executive Officer,
Head of Growth & Cross Border
Investment Department
2015:	Director and Managing Executive
Officer of DBJ

Integrated Report 2018

1986:	Joined The Japan Development Bank
2012:	Executive Officer in Charge of Special
Missions
2013:	Executive Officer, Head of Corporate
Planning & Coordination Department
2015:	Managing Executive Officer of DBJ
2018:	Director and Managing Executive
Officer of DBJ

2008:	Director at DBJ

Director and Managing Executive Officer

Outside Director

Kenkichi Fukuda

Kazuo Ueda

In charge of Corporate Planning &Coordination Department,
Information Resources Department,
General Affairs Department

Professor and Head of Office for
New Department Planning,
Kyoritsu Women’s University,
Faculty of International Studies;
Director of Tokyo University’s Center for
Advanced Research in Finance

1983:	Joined The Japan Development Bank
2009:	General Manager,
Head of Chugoku Branch
2012:	Executive Officer, Head of Human
Resources Management Department
2014:	Managing Executive Officer,
Head of Kansai Branch
2016:	Director and Managing Executive
Officer of DBJ

62

1986:	Joined The Japan Development Bank
2011:	Head of Economic & Industrial Research
Department
2013:	Executive Officer, Head of Business
Planning & Coordination Department
2015:	Managing Executive Officer of DBJ
2018:	Director and Managing Executive
Officer of DBJ

2008:	Director at DBJ

Executive Officers (excluding those who are concurrently directors)

Audit & Supervisory Board Member

Managing Executive Officer

Executive Officer

Atsushi Kurashige

Hisanobu Sekine

Ryusei Segawa

1986:	Joined The Japan Development Bank
2010:	General Manager,
Credit Analysis Department
2011:	General Manager, Secretariat Office
2013:	General Manager, Head of Urban
Development Department
2017:	Audit & Supervisory Board Member
at DBJ

In charge of Structured Finance
Department, Hokkaido Branch,
Tohoku Branch, Niigata Branch

In charge of Internal Audit

Executive Officer

Takao Kaizu

Managing Executive Officer

Mitsue Kurihara

Yoshinao Ikeda

1987:	Joined The Japan Development Bank
2011:	Senior Vice President of Healthcare &Hospitality Industry Office,Corporate Finance Department,
Division 4
2013:	General Manager, Head of Corporate
Finance Department, Division 6
2015:	Audit & Supervisory Board Member
at DBJ

In charge of Corporate Finance
Department, Division 1 and 2

Managing Executive Officer

Masayuki Tsuda

Toshio Yamasaki

Keisuke Takegahara
Deputy Chief Research Officer,
Chief Manager of Sustainability
Management Office, Corporate
Planning & Coordination Department

Executive Officer

Shigeru Tamagoshi
Head of Business Planning &Coordination Department

Executive Officer

Managing Executive Officer

Toshiyasu Takazawa

Norifumi Sugimoto

Head of Corporate Planning &Coordination Department

In charge of Regional Planning
Department, Hokuriku Branch,
Tokai Branch, Kyushu Branch,
Minami-Kyushu Branch

Executive Officer

Managing Executive Officer(Head of Kansai Branch)

Head of Growth & Cross Border
Investment Department

Shoichiro Kubota
Corporate Data

1982:	Joined The Sumitomo Trust andBanking Co., Ltd.
2017:	President of Sumitomo Mitsui Trust
General Service Co., Ltd.
2018:	Advisor of Sumitomo Mitsui Trust
General Service Co., Ltd.
2018:	Audit & Supervisory Board Member
at DBJ

Executive Officer

Hiroshi Shimizu
In charge of Kansai Branch,
Chugoku Branch, Shikoku Branch

Outside Audit & Supervisory Board Member

Makoto Ito
Advisor at Nagashima Ohno &Tsunematsu; Visiting Professor,
Nihon University Law School
2008:	Audit & Supervisory Board Member
at DBJManaging Executive Officer

Yasushi Babasaki
In charge of Corporate Finance
Department, Division 4

Managing Executive Officer

Michihiro Kishimoto
In charge of Corporate Finance
Department, Division 5

Outside Audit & Supervisory Board Member

Shinji Hatta
Professor, OHARA Graduate School of
Accounting; Professor Emeritus,
Aoyama Gakuin University
2008:	Audit & Supervisory Board Member
at DBJ

Risk Management

In charge of Urban Development
Department, Real Estate Finance
Department, Corporate Finance
Department, Division 3

Head of Human Resources
Management Department

Corporate Governance

Audit & Supervisory Board Member

Tsutomu Murakami

DBJ Group’s Strategy

Managing Executive Officer

In charge of Financial Institutions
Department, Corporate Finance
Department, Division 6

Outside Audit & Supervisory Board Member

DBJ Group’s Vision

Audit & Supervisory Board Members

Notes: Of the 15 directors and Audit & Supervisory Board members, 14 are male andone is female, leaving the female to male ratio at 6.7%.
Standards and policies related to independence in the selection of outside directors andoutside Audit & Supervisory Board members are not applicable.
Akio Mimura, Honorary Chairman of Nippon Steel & Sumitomo Metal Corporation, isan outside director of DBJ. DBJ has no special relationship with Mr. Mimura, and its
business with Nippon Steel & Sumitomo Metal Corporation is conducted normally.
DBJ has no special-interest relationship with any other of its outside directors or outside
Audit & Supervisory Board members.
DBJ has signed liability limitation agreements with its outside directors and outside Audit& Supervisory Board members, based on Paragraph 1, Article 427, of the Companies Act.

Integrated Report 2018

63

Risk Management

Risk Management System
DBJ conducts risk management from the perspective ofensuring management soundness. To ensure appropriate
management of individual risk categories, DBJ has developed a vital risk management system that specifies andevaluates manageable risks and clarifies which department
is responsible for each type of risk. The Risk Management
Department oversees comprehensive risk management
activities.

The ALM & Risk Management Committee and theGeneral Risk Management Committee deliberate on important matters concerning risks and conduct regular monitoring, in line with the basic policy related to comprehensive
risk management approved by the Board of Directors.

Asset/Liability and Risk Management System Overview

Executive
Committee

President

ALM & Risk Management
Committee

Risk
Management
Department

Credit Analysis
Department

Treasury
Department

Investment
and Loan
Departments/
OfficesComprehensive Risk Management
The Risk Management Department assesses both comprehensive and individual risks. Based on risk guidelines thatweigh Executive Committee business plans and the resultsof stress tests, the Risk Management Department controls
the amount of comprehensive risk and that of individual

risk categories at a determined level. Furthermore, theCorporate Planning & Coordination Department has begun
efforts to measure risk–return by such means as risk-adjusted
return on capital.

1. Credit Risk
Credit risk refers to the risk of sustaining losses resulting
from a decline in or loss of the value of assets due to deterioration in the financial condition of the borrower. DBJ
provides corporate loans and non-recourse loans, making
credit risk acquisition a source for profits. As such, it represents a significant risk category, with DBJ conducting credit
management of individual projects as well as bank-wide
portfolio management, accordingly.
i. Credit Administration of Individual Loans
When making an investment or loan, DBJ examines theentity’s project viability and the project’s profitability froma fair and impartial standpoint. DBJ is not subject to the
Banking Act or the Act on Emergency Measures for the
Revitalization of the Financial Functions (Act No. 132 of
1998), but carries out independent asset assessments inline with internal policies for self-assessment of credit

64

Integrated Report 2018

quality based on the Financial Services Agency’s Financial
Inspection Manual. The results of self-assessments are
subject to an audit by an auditing corporation and arereported to management. Credit risk and amounts aremonitored to confirm that they are within the limits established for individual borrowers.
The sales and credit analysis departments hold separate
roles in the screening and administering of credit for individual projects, and each department keeps the operationsof the other in check.
The Committee on Investment and Loan Decisions meetsas needed to deliberate important issues concerning themanagement and operation of individual projects.
These mutual checking functions serve to ensure the appropriateness of the finance operation and management system.

Asset Self-Assessment System
Asset self-assessments are used to define asset classifications that will offset recoverability risk or the degree of riskof value loss based on the borrower rating, the corresponding borrower category, and the collateral or guarantee
status. Such assessments help DBJ establish timely andappropriate amortization schedules and reserve levels.

DBJ Group’s Vision
DBJ Group’s Strategy

Borrower Rating System
DBJ’s borrower rating system measures creditworthiness by
combining an evaluation point rating and a borrower category rating with the results quantifying a potential client’s
credit circumstances.
The evaluation point rating selects indicator and evaluation categories that are common across all industries, scoring
the creditworthiness of the potential borrower quantitatively
and qualitatively. On the other hand, the borrower category
rating measures specific items related to the borrower,
looking at the borrower’s realistic financial condition, cash
flows, and debt repayment history, generating a comprehensive assessment of a borrower’s repayment capacity.
Borrower Rating Classifications
Borrower
RatingDefinition

Normal borrowers

1–8

Borrowers with favorable business conditions who have been confirmed to have noparticular problematic financial circumstances.

Borrowers requiringcaution

9–11

Borrowers experiencing weak business conditions, are unstable, or have issues with
their finances. These borrowers need to be managed with caution.

Substandard
borrowers

12

Either some or all of the debt of these borrowers requiring caution is undermanagement.

Substandard claims

Borrowers in dangerof bankruptcy

13

Borrowers in this category are having financial difficulties but are not bankrupt.
Management improvement plans and the like are progressing poorly, and theseborrowers are highly likely to fall into bankruptcy.

Doubtful claims

Effectively bankrupt
borrowers

14

Although not legally or formally in bankruptcy, these borrowers are experiencing
severe financial difficulties and are realistically falling into bankruptcy as their lackof potential for restructuring has been confirmed.

15

These borrowers are in bankruptcy, legally and formally. Specifically, these borrowers
are in bankruptcy or liquidation, under corporate reorganization, bankruptcy
proceedings or civil rehabilitation, or have had transactions suspended by a billclearinghouse.

Claims in bankruptcy,
reorganization claims,
and similar claims

maximum loss that could be incurred at a certain rate ofprobability minus the EL. The EL and UL calculations arereported to the ALM & Risk Management Committee.
Through such monitoring and the consideration of countermeasures, DBJ is committed to controlling risk and devising effective measures to improve risk–return.

2. Investment Risk
Investment risk refers to the risk of sustaining losses resulting from a decline in or loss of the economic value of assets
due to worsening financial conditions for entities receiving
funds and to changing market environments. DBJ’s investments include the provision of mezzanine and equity
financing, particularly to unlisted entities, such as corporations, funds, infrastructure, and real estate. As a source ofprofits, investments represent one of DBJ’s most significant
risk categories. DBJ makes investment decisions andmanages individual investments as well as its bank-wide
portfolio accordingly.

In addition to investment analysis and management inline with credit risk management, investment decisions
based on target returns in accordance with investment category and regular monitoring are utilized to manage individual investments. In terms of portfolio management, we
conduct risk measurement that applies credit and market
risk assessment methods, with a focus on differences
between investment categories and recovery methods.

Integrated Report 2018

65

Corporate Data

ii. Portfolio Management
DBJ performs a comprehensive analysis of data based onborrower ratings and calculates the loan portfolio’s overall
exposure to credit risk. Credit risk exposure can be classified
as (1) expected loss (EL), the average loss expected during a
specific loan period; and (2) unexpected loss (UL), theNormal claims

Risk Management

Bankrupt borrowers

Claims Classified under the
Financial Revitalization Act

Corporate Governance

Borrower Category

Risk Management

3. Market Risk
The primary focuses in terms of market risk management
are interest rate risk and exchange risk. DBJ classifies
market risk as passive risk pertaining to investment andloan activities and implements management in the manner
detailed below. DBJ does not have any trading-related risk
because it does not engage in trading (specified
transactions).
i. Interest Rate Risk
Interest rate fluctuations can create mismatches on rates ofinterest on assets and liabilities or on interest periods, creating the risk of reduced profits or the risk of losses. Interest
rate risk can reduce the economic value of DBJ’s assets orinterest income.
Based on monitoring through multifaceted indices, suchas value at risk (VaR) and interest rate sensitivity analyses(basis point value), as well as ALM policies established by
the Executive Committee, DBJ conducts comprehensive
management of current assets and liabilities to optimize
net interest expenses and economic value by adequately
controlling interest rate risk and financial liquidity risk. In
regard to controlling interest risk, a portion of the interest
rate risk is covered through interest rate swaps.

ii. Exchange Risk
Exchange risk is the risk of loss due to volatility in exchange
rates, and this risk affects entities holding a net excess ofassets or liabilities denominated in foreign currencies. DBJ’s
exchange risk derives from financing in foreign currencies
and issuing foreign currency bonds. However, DBJ uses
exchange swaps and other instruments to limit this risk interms of assets and liabilities denominated in foreign
currencies at a net-base position.
DBJ uses swap transactions to manage counterparty risk bycontinuously monitoring the creditworthiness of all parties
and by setting a limit to financing for each counterparty.
DBJ also conducts risk management through margin transfers by means of a centralized exchange and mutual credit
support annex.

4. Liquidity Risk
Liquidity risk is the risk of a mismatch occurring in the periods when funds are used and raised or of an unexpected
outflow of funds, causing differences in the flow of funds(cash liquidity risk). Such situations make securing funds
difficult and create situations in which interest rates onborrowed funds are substantially higher than usual rates.
At other times, because of market complexities, entities inthese circumstances may become unable to participate inmarket transactions, compelling them to conduct transactions under substantially less favorable terms than otherwise would be the case. The risk of losses for these reasons
is known as market liquidity risk.
As its main methods of acquiring funds, in addition toissuing corporate bonds and taking out long-term loans,

DBJ relies on the stable procurement of long-term funds
from the Japanese government’s Fiscal Investment and Loan
Program and government-guaranteed bonds rather than on
short-term funds such as deposits. Contingency plans are
established as appropriate to meet unexpected short-term
funding requirements and cash flow shortfalls.
Additionally, DBJ maintains daytime liquidity by using the
Bank of Japan’s real-time gross settlement system, whereby
settlement is made instantly for each transaction. Everyeffort is made to ensure that settlement conditions aremanaged appropriately.
In addition to credit, investment, and market risk, the
ALM & Risk Management Committee deliberates DBJ’sliquidity risk.

5. Operational Risk
DBJ defines operational risk as the risk of loss arising frominternal processes, people or systems that are inappropriate
or non-functioning, or from external events. DBJ works toestablish a risk management system to minimize risk andprevent potential risks from materializing. The General Risk
Management Committee has been established to deliberate
topics concerning operational risk management.

66

Integrated Report 2018

Within operational risk management, DBJ conducts administrative risk management and system risk management as
described below.

The BCP describes in an easy-to-understand format therole of the Disaster Response Committee, work priorities,
and specific actions and procedures to be taken in the eventof a disaster. When drawing up policies for business continuity and restoration, the Company envisions specific incidents, such as an earthquake underneath the Tokyo
metropolis, and methodically decides how to respond to
anticipated damage in each disaster scenario.

Measures to Ensure Business Continuity

Risk Management

DBJ prepares a business continuity plan (BCP) to protect theinterests of its stakeholders, including its clients, its shareholder, and its executives and employees, as well as to fulfill
its social mission. The BCP aims to ensure the continuity
and rapid recovery of core operations in the event of emergencies, such as natural disasters (in particular, large-scale
earthquakes), influenza and other pandemics, system failures, and power outages.

Corporate GovernanceBusiness Continuity Initiatives

DBJ Group’s Strategy

ii. System Risk Management
System risk refers to the risk of loss due to a computer
system breakdown or malfunction, system defects, or
improper computer use. DBJ has implemented the followinginternal processes to optimize system risk management andproperly manage risk with regard to system risk. The System
Risk Management Division is responsible for managing DBJ’s
system risk centrally, based on its system risk management
regulations. By determining security standards from a varietyof viewpoints—from information system planning and development to operation and use—the department extends therisk management system bank-wide and addresses appropriate system risk management operations.

DBJ Group’s Visioni. Administrative Risk Management
Administrative risk refers to the risk of sustaining losses
resulting from employees neglecting to perform their duties
correctly or from accidents, fraud, and the like. To reduce or
prevent administrative risk, DBJ prepares manuals, performs
checks on administrative procedures, provides educationand training, and uses systems to reduce the burden of
administrative duties.

We have prepared a variety of measures to ensure business continuity.

Multilayered Communication Procedures
We introduced a safety confirmation system to quickly
determine the whereabouts and status of executives andemployees even at night and on holidays. In addition, we
distributed satellite telephones to key locations and personnel to ensure multilayered communication procedures.

Chain of Command and Delegation of Authority
To assure that decision-making concerning the continuity ofcore operations is prompt and certain, in the event that theDisaster Response Committee is established, we have put inplace a chain of command and an alternative hierarchy bywhich authority can be delegated.
Clarification of Initial Response and Procedures forContinuing or Recovering Core Operations
For individual business units, we have established inadvance the procedures for the initial response and thecontinuation or recovery of core operations so that relevant
divisions can respond quickly and with certainty on core
operations even when in a state of confusion.

Initiatives to Maintain or Improve BCP Viability
DBJ conducts various types of instruction and training ofexecutives and regular employees to maintain or improvethe viability of its BCP. Furthermore, employing a Plan-DoCheck-Act cycle, we revise the BCP to reflect training

results and recent information, and the Executive
Committee reviews it regularly and amends it as necessary.

Integrated Report 2018

67

Corporate Data

Enhanced System Robustness
We ensured advanced security levels at the main center andcreated a backup center to operate in the event that themain center ceases to operate.

Timeline

The Japan Development Bank, the Hokkaido-Tohoku Development Finance Public Corporation,and the Development Bank of Japan
Year

Month

Event

1951

April

The Japan Development Bank (JDB) established1952

JDB branches opened in Osaka (now the Kansai Branch), Sapporo (now the Hokkaido Branch),
Nagoya (now the Tokai Branch), and Fukuoka (now the Kyushu Branch)

1956

June

The Hokkaido Development Finance Public Corporation established

1957

April

The Hokkaido Development Finance Public Corporation, reorganized as the Hokkaido-Tohoku Development
Finance Public Corporation (HTDFP) branches, opened in Sapporo (now the Hokkaido Branch) andSendai (now the Tohoku Branch)

1960

JDB branch opened in Takamatsu (now the Shikoku Branch)

1961
1962

JDB branches opened in Hiroshima (now the Chugoku Branch) and Kanazawa (now the Hokuriku Branch)
April

1963

JDB representative office opened in New YorkJDB representative offices opened in Kagoshima (renamed Minami-Kyushu Branch in October 1999) and Matsue

1964

July

1972

January

1985

June

1987

September

1989

JDB representative office opened in London
HTDFP representative office opened in Niigata (renamed Niigata Branch in July 1989)
The Japan Development Bank Law revised1)	Investment function (pertaining to business in such areas as research and development,
urban development, and energy use stipulated by government ordinance) added
2) R&D fund investment function added
Low interest rate loan system funded partially by sale of NTT shares created by JDB and HTDFP
JDB representative offices opened in Oita, Matsuyama, Okayama, and Toyama
HTDFP representative offices opened in Hakodate and Aomori

1995

February

1997

SeptemberBill entitled “Pertaining to Consolidation and Rationalization of Special-Purpose Companies, etc.” approvedby the Cabinet (decision dissolving JDB and HTDFP and consolidating them as a new bank approved)

1998

December

JDB and HTDFP loans in response to changes in the financial environment commenced(March 31, 2001, sunset clause introduced)

1999

June
October

JDB loans to assist disaster recovery commenced

The Development Bank of Japan Law (Law No. 73 of 1999) approved
All rights and responsibilities of JDB and HTDFP and all financing operations of Japan Regional Development Corporation andJapan Environment Corporation transferred to the Development Bank of Japan
DBJ representative offices opened in Kushiro and Singapore

2002

May

2005

December

2006

May

The Act on Promotion of Administrative Reform for Realization of Small and Efficient Government(Act No. 47 of 2006) approved

June

Policy-Based Financing Reform Plan decided upon by DBJ head office for the Implementation of Policy Finance Reform

2007

June

The Development Bank of Japan Inc. Act (Act No. 85 of 2007) approved

The Development Bank of Japan Law revised (additional spot inspections by the Financial Services Agency introduced)
Important Policy of Administrative Reform approved by the Cabinet

Development Bank of Japan Inc.
Year

Month

2008

October

Event

Development Bank of Japan Inc. (DBJ) established (Capital: ¥1 trillion)
Crisis Response Operations begun by DBJ as a designated financial institution

December
2009

June

Act for Partial Amendment of the Development Bank of Japan Inc. Act (Act No. 67 of 2009) approved

September

Capital increased to ¥1,103,232 million

November

DBJ Europe Limited launched

2010

March

2011

May

2012

DBJ Singapore Limited launched

Capital increased to ¥1,181,194 million
The Development Bank of Japan Inc. Act partially amended based on establishment of the Act for Extraordinary Expenditure andAssistance to Cope with the Great East Japan Earthquake (Act No. 40 of 2011)

December

Capital increased to ¥1,187,364 million

March

Capital increased to ¥1,187,788 million

June

Capital increased to ¥1,198,316 million

December

Capital increased to ¥1,206,953 million

2014

June

DBJ Investment Consulting (Beijing) Co., Ltd. (formerly Japan Asia Investment Consulting (Beijing) Co., Ltd.) converted to wholly
owned subsidiary

2015

May

Act for Partial Amendment of the Development Bank of Japan Inc. Act (Act No. 23 of 2015) approved
Special Investment Operations started
Advisory Board positioned as an advisory body to the Board of Directors
Special Investment Operations Monitoring Board established

August68

Capital reduced by ¥206,529 million, and crisis response reserve increased by the same amountIntegrated Report 2018

Shareholder

Address

Number of shares held (thousands of shares)

Percentage of total equity (%)

Finance Minister

1-1, Kasumigaseki 3-chome, Chiyoda-ku, Tokyo

43,632100.00Total—

43,632100.00Highlights of 2015 Revisions to the DBJ Act
1. Measures maintaining direction toward full-scale privatization
BeforerevisionFull-scale privatization and disposal of all Japanese
government-held shares, targeting around five toseven years from April 1, 2015•	No changes in the main provisions, including Article 1, which stipulates DBJ’s objectives

After•	Disposal of shares as soon as practicable (considering its effect on achieving DBJ’s
revision objectives as well as on the market situation)

2. Measures ensuring appropriate implementation of Crisis Response Operations
Beforerevision•	Conducting Crisis Response Operations as a designated financial institution•	Enabling Japanese government recapitalization incrisis response by March 31, 2015

•	Assuming responsibility for Crisis Response Operations for an indefinite period (at thesame time reflecting this obligation in the Articles of Incorporation)

After•	Extending for an indefinite period the scope of the Japanese government’s recapitalrevision ization securing DBJ’s financial structure, with the Japanese government having suchobligations as holding more than one-third of DBJ’s shares

3. Measures establishing new Special Investment Operations scheme to temporarily provide growth capital in a concentrated manner

Beforerevision

Provision of risk capital through the Fund for JapaneseIndustrial Competitiveness•	Reinforcement of the Fund for Japanese Industrial Competitiveness (a portion of thefinancial resources for which are provided through measures for industrial investment);
implementation of Special Investment Operations as a measure for a limited period of
Aftertime, through fiscal 2025 (at the same time reflecting this obligation in the Articles ofrevision Incorporation, complementing and encouraging private-sector enterprises, etc.)•	Obligation that the Japanese government shall hold one-half or more of shares until
the conclusion of Special Investment Operations

4. Provisions referencing consideration for private financial institutions through ongoing Japanese government involvement
As per the Third Medium-Term Management Plan,
Before sustainment of close communications, maintaining arevision focus on operations in collaboration with otherfinancial institutions•	The Corporation shall, for an indefinite period, pay special attention in conducting its
business so that it will not affect its appropriate competitive relationships with otherbusiness entities
After•	The Japanese government shall hear the opinions of representatives of ordinary
revision financial institutions and other relevant persons concerning Japanese government
revisions on an as-needed basis regarding Crisis Response Operations and Special
Investment Operations

Integrated Report 2018

69

Corporate Data

Note: For the full text of the DBJ Act, please refer to the Data section.

Risk Management

provision of funding in response to large-scale disasters andeconomic crises, the amending act makes DBJ’s Crisis
Response Operations obligatory for an indefinite period.
From the perspective of promoting the provision of growth
capital to revitalize regional economies and increase thecompetitiveness of enterprises, the amending act calls for
DBJ to accept a certain amount of capital from the Japanese
government (industrial investment). This investment is to be
used for a new scheme, Special Investment Operations, tostrengthen and develop the Fund for Japanese Industrial
Competitiveness. In addition, with regard to the applicationof DBJ’s investment and loan functions toward crisis
response and the provision of growth capital, measures
were introduced obliging the Japanese government to holdat least a certain percentage of DBJ’s shares.
As part of this structural revision, deliberations by theJapanese government’s Study Panel Concerning thePromotion of Expanding Growth Funding covered such
topics as DBJ’s proper implementation of Crisis Response
Operations, the importance of initiatives for providing
growth capital (equity and mezzanine financing) to address
shortages in Japanese financial and capital markets, and anevaluation of DBJ’s initiatives following its conversion to a
joint-stock company.

Corporate GovernanceOn October 1, 2008, DBJ transitioned from a special public
corporation to a joint-stock company. In preparation for
full-scale privatization following the disposal of all Japanese
government-owned shares, DBJ has continued working toenhance its corporate value through integrated investment
and loan services. These activities include providing longterm loans; equity, mezzanine financing and other typesof risk capital; and M&A advisory services.
On the other hand, shortly after DBJ’s conversion toa joint-stock company, the global financial crisis and theGreat East Japan Earthquake occurred. The Japanese
government called on DBJ to steadily mount large-scale
Crisis Response Operations. Due to these crises, theDevelopment Bank of Japan Inc. Act (Act No. 85 of 2007:“DBJ Act”) was amended twice, with DBJ accepting an
additional increase in Japanese government capital. Also,by the end of fiscal 2014, the Japanese government was
to review DBJ’s organization, including its shareholdings,
as stipulated by the revision.
Based on the deliberations by the Japanese government’s
Study Panel Concerning the Promotion of Expanding
Growth Funding, the Act for Partial Amendment of theDevelopment Bank of Japan Inc. Act, which was enacted on
May 20, 2015, maintains the direction toward full-scale
privatization. At the same time, in order to fully ensure the

DBJ Group’s Strategy

Summary of Changes to the DBJ Act after Conversion toa Joint-Stock Company

DBJ Group’s Vision

As of March 31, 2018
Name

Organizational Structure (as of August 1, 2018)

Business Planning & Coordination Department

General Meeting of
Shareholders

Innovation Promotion OfficeFinancial Institutions Department
Urban Development Department
Audit & Supervisory
Board Members /Audit & Supervisory
Board

International Strategy & Coordination Department
Corporate Finance Department,
Division 1

Audit & Supervisory
Board Office

Corporate Finance Department,
Division 2

Aerospace Office

Corporate Finance Department,
Division 3

Global Logistics Office

Corporate Finance Department,
Division 4
Corporate Finance Department,
Division 5
Board of Directors

Corporate Finance Department,
Division 6

Executive Committee

Healthcare Industry Office

Hokkaido Branch
Tohoku Branch
Advisory Board

Tohoku Recovery & Growth Support OfficeNiigata Branch
Hokuriku Branch
Tokai BranchSpecial Investment
Operations
Monitoring Board

Kansai Branch
Chugoku Branch
Shikoku Branch
Kyushu Branch

Kumamoto Recovery Office

Minami-Kyushu Branch
Real Estate Finance Department
Chief
Investment
Officer

Strategic Finance Department

Regional Investment Promotion Office

Growth & Cross Border Investment Department
Structured Finance Department
Syndication & Credit Trading Department
Business Development Department

Chief
Research
Officer

Sustainability Planning & Support Department
Economic & Industrial Research Department
Regional Planning Department
Research Institute of Capital Formation

Economic Research Office
Industrial Research & Customer Solutions
Planning Office
Corporate Management & Accounting
Research OfficeSecretariat Office
Human Resources Management Department

Representative Offices:
Hakodate, Kushiro, Aomori,Toyama, Matsue, Okayama,
Matsuyama, Oita

Corporate Planning & Coordination Department

Overseas Representative Office:
New York

General Affairs Department

Overseas Subsidiaries:
DBJ Singapore Limited
DBJ Europe Limited
DBJ Investment Consulting (Beijing) Co., Ltd.

Credit Analysis Department

Operations Audit
Committee

70

Integrated Report 2018

Risk Management Department

Public Relations OfficeSustainability Management OfficeInformation Resources Department

Accounting Department

Legal Affairs & Compliance Department
Treasury Department
Internal Audit Department

Settlement & Accounting Operations OfficeCorporate Information

Established

October 1, 2008

Head office

Otemachi Financial City South Tower, 9-6, Otemachi 1-chome, Chiyoda-ku, Tokyo 100-8178, Japan
Tel: +81-3-3270-3211

Capital¥1,000,424 million (All capital is funded by the government of Japan)

Number of employees

1,631 (non-consolidated 1,182)

(As of March 31, 2018)

Group Companies

DBJ Group’s Strategy

Development Bank of Japan Inc.

DBJ Group’s VisionName

The DBJ Group provides diverse services that satisfy the needs of its customers.

DBJ Singapore Limited

DBJ Investment Consulting (Beijing) Co., Ltd.

DBJ Singapore Limited is a Singapore-based subsidiary established in December 2008. It mainly provides support for investments and loans as well as advisory services in the Asia-Pacificregion, and also collects and disseminates information locally.

DBJ Investment Consulting (Beijing) Co., Ltd. became a wholly
owned subsidiary in June 2014 and is based in Beijing andShanghai. It mainly offers support for investment and loan
services in China, and also collects and disseminates information locally.

Risk Management

DBJ Europe Limited
DBJ Europe Limited is a London-based subsidiary established in
November 2009. It mainly provides support for investment
and loan services in Europe, and also collects and disseminates
information locally.

Investments
and loans,Assetmanagement

Real estate
management /IT services

DBJ Capital Co., Ltd.

DBJ Investment Advisory Co., Ltd.

DBJ Capital Co., Ltd. is the venture capital arm of DBJ Group. It
mainly makes early-stage equity
investments in venture firms, and supports their growth throughhands-on management.

DBJ Investment Advisory Co., Ltd. provides advice related to
DBJ’s VG (Value for Growth) Investment Program*.

DBJ Securities Co., Ltd.

DBJ Asset Management Co., Ltd.

DBJ Securities Co., Ltd. is a securities subsidiary that assists DBJ
Group with investment and loan
services.
It supports optimal capital procurement, provides asset
management opportunities, and flexibly fulfills diverse needs.

DBJ Asset Management Co.,
Ltd. is an asset managementcompany focused on real estate,
private equity, and infrastructure investments. It provides quality investment opportunities to investors with the comprehensive financial backing of DBJ Group.

Japan Economic Research Institute, Inc.

Value Management Institute, Inc.

Japan
EconomicResearch
Institute, Inc. is a comprehensive think tank that primarily
conducts surveys and consulting. It meets customer needsfrom a comprehensive viewpoint, leveraging synergies in its
three survey fields: public, solutions, and international.

Value Management Institute,
Inc. is a comprehensive thinktank with strengths derived
from its insight into advanced technologies and analysis using
proprietary economic models. It provides tailor-made solutions
to a broad range of government policy issues.

DBJ Real Estate Co., Ltd.

Consist, Inc.

DBJ Real Estate Co., Ltd. handles
administrative functions for DBJ
Group for office building leasing, rental conference rooms, and business libraries.

Consist, Inc. provides one-stop
consulting services for developing, maintaining, and operating
IT, using technology to help solve social issues.

* Value-added equity investment that supports growth strategies

Integrated Report 201871

Corporate Data

Research,
Consulting

Corporate GovernanceOverseas
locationsIntegrated Reporthttps://www.dbj.jp/en

2018

Printed in Japan

Development Bank of Japan Inc.

In consideration of the environment, this report is printed
on FSC-certified paper using vegetable oil ink.