Presentation Material

Management Vision of the Sony Financial
Holdings Group for Fiscal Year 2011

Sony Financial Holdings Inc.
September 9, 2011

Sony Financial Holdings Inc. All Rights Reserved

Disclaimers:
This presentation material contains statements concerning the current plans, expectations, strategies and beliefs of the SonyFinancial Holdings Group (the “SFH Group”). Any statements contained herein that pertain to future operating performanceand that are not historic facts are forward
forward-looking
looking statements.
statements Forward-looking
Forward looking statements may include
include—but
but are not limited
to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” and “possibility” that describe future
operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or written, arebased on judgments made by the management of the SFH Group, based on information that is currently available to it. As
such, these forward-looking statements are subject to various risks and uncertainties, and actual business results may vary
substantially from the forecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned
not to place undue reliance on forward-looking statements. The SFH Group disclaims any obligation to revise forward-looking
statements in light of new information, future events or other findings. The information contained in this presentation does notconstitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any
p of it form the basis of or be relied on in connection with anyy contract or commitment
securities,, nor shall it or anyy partwhatsoever.

Sony Financial Holdings Inc. All Rights Reserved

1Today’s Agenda (From 10:00 a.m. to 11:30 a.m.) Presentation

Katsumi Ihara

President, Representative Director ofSony Financial Holdings Inc.

 Question and Answer Session

Katsumi Ihara

President, Representative Director ofSony Financial Holdings Inc.

Hirotoshi Watanabe Director of Sony Financial Holdings Inc.
Mitsuhiro Koizumi

Director of Sony Life Insurance Co., Ltd.

Shinichi Yamamoto

President, Representative Director of Sony Assurance Inc.

Shigeru Ishii

President, Representative Director of Sony Bank Inc.

Sony Financial Holdings Inc. All Rights Reserved

2

Presentation

Sony Financial Holdings Inc. All Rights Reserved

3Key Messages

SFH Group Mid-Term Business Developments
Realizing a Stable Management Structure andAchieving Sustainable Growth
Expanding revenues for the three main businesses( g(Targetingg annual growthgin consolidated ordinary
y revenues
of 6%+ by FY2013)

Growing profit indicators at 10%+ pp.a.
a by FY2013
FY2013, following an
expected drop in profit due to lower gains on sale of securities in
FY2011
Realizing high capital efficiency while maintaining
financial soundness(Targeting consolidated adjusted ROE of 7.5–8.0% in FY2013)
Sony Financial Holdings Inc. All Rights Reserved

4

FY2011 1Q Review

Sony Financial Holdings Inc. All Rights Reserved

5

FY2011 1Q Review

9For FY2011 1Q, consolidated ordinary revenues increased andconsolidated
lid t d ordinarydiprofitfit was nearlyl flat
fl t year on year. Th
The ddamage ffrom
the Great East Japan Earthquake on our operating results was limited.

9The
Th life
lif insuranceibusinessb icontinuedti
d tto grow iin itits policy
li amountt iin fforce,due to favorable sales of mainstay death-protection type and third-sector
insurance products such as living benefit and nursing-care insurance.

9The non-life insurance business enjoyed brisk sales. The last year’s
upward trend in the loss ratio for automobile insurance showed signs ofslowing in this first quarter.

9The banking business has improved its interest spread along with agrowing balance off mortgage loans under unfavorablefbusiness conditionsof low interest rates.

Sony Financial Holdings Inc. All Rights Reserved

6

FY2011 1Q Review(Billions of yen)

Ordinary revenues

240.5

Ordinary profit

+6.8%
%

256.8

FY10 1Q
FY10.1Q

214.1

229.3

+15.1

+7.1%

ChangeOrdinary revenues
Ordinary profit

18.5

17.6

(0.9)

(4.9%)

Non-life
insurancebusiness

Ordinary revenues

19.0

20.4

+1.4

+7.4%

Ordinary profit

0.4

0.7

+0.3

+67.7%

Ordinary revenues

7.7

7.4

(0.3)

(4.0%)

Ordinary profit

0.5

0.8

+0.3

+74.8%

(0 4)
(0.4)

(0 4)
(0.4)

(0 0)
(0.0)

+7 5%
+7.5%

0.0

0.0

+0.0

+17.2%

240.5

256.8

+16.2

+6.8%

O
Ordinary
profit
f

19 5
19.5

19 3
19.3

(0 2)
(0.2)

(1 1%)(1.1%)Net income

10.3

10.8

+0.5

+4.9%

Intersegment
adjustments*

Ordinary revenues
Ordinary profit
Ordinary revenues

19.3
C
Consolidated
lid t d19.5

FY11.1Q

Life
iinsurance
business

Bankingbusiness(1.1%)

FY10.1Q

FY11 1Q
FY11.1Q(Billions of yen)

Consolidated

Change from11 3 3111.3.31(Billions of yen)

10.6.30

11.3.3111.6.30

Total assets

6,085.4

6,597.1

6,705.6+108.4+1.6%

Net assets

283.0

294.8

309.6

+14.7

+5.0%

*Amounts in the Ordinary profit in the “Intersegment adjustments” are mainly from SFH.
*Comprehensive income: FY10.1Q: ¥20.1 billion, FY11.1Q: ¥23.4 billion yen
Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

7

FY2011 Consolidated Financial Forecast
Consolidated Ordinary Revenues
Banking business
Non-life insurance businessLife insurance business(Billions of yen)

 SFH’s
SFH’ consolidated
lid t d financialfi
i l forecast
ft for
f FY2011 isiunchanged from the announcement at the beginningof FY2011

1,000

1,002.2

1,022.0500(Billions of yen)
FY10

FY11
Forecastt
F

ActualConsolidated ordinary revenues

ChangeFY10
0 actuaactual vs.
s
FY11 forecast

FY10 (Actual)

1,002.2

1,022.0+ 2.0%

Life insurance business

900.3

909.3

+ 1.0%

Non-life insurance business

74.1

80.4

+ 8.4%

Banking business

29.5

32.8

+ 11.0%

76.8

59.0

(23.2%)

Life insurance business

72.1

53.0

(26.6%)

Non-life insurance business

2.1

2.6

+ 21.2%

Banking business

2.4

4.1

+ 70.3%29.0(30.5％)

Consolidated ordinary profit

0
FY11 (Forecast)

Consolidated Ordinary Profit(Billions of yen)
100

Bankingg business
Non-life insurance businessLife insurance business

76.8
59 0
59.0
50

Consolidated net income

41.7(Line item amounts are truncated below ¥100 million; percentage changes are rounded.)0
FY10 (Actual)

Sony Financial Holdings Inc. All Rights Reserved

FY11 (Forecast)8

“Pillars of Growth” & “Mid-term Targets”
for the Three Core Businesses

Sony Financial Holdings Inc. All Rights Reserved

9Sony Life: Pillars of Growth

Strengthening
existing channels

・Lifeplanner sales employees: Maintain or expand
high-quality channel
・Independent agents: Expand business operations
through tie-ups with various independent agents

Seniormarket initiatives

・Capture solid share of growth market
・Develop and promote products and services tailoredto the needs of the senior market

Operational
improvements

・Shift to p
paperlessp
operationspand leverageg IT
strengths to raise operating efficiency andenhance customer service

Asset stability
and ALM・Achieve stable MCEV growth and structure
portfolio that is highly resistant to declines instock
t k pricesiandd iinteresttt ratestSony Financial Holdings Inc. All Rights Reserved10Sony Life: Lifeplanner Channel
 Maintain and expand its high-quality channel through promoting both recruitment

and productivity of Lifeplanner sales employees
Number and productivity of Lifeplanner sales
employees

Introduced stricter recruitment
standards
d d*FY08 as 100
110

Strengthening Lifeplanner recruitment
activities and training programs

Productivity

Increasing the number of sales officemangers, responsible for Lifeplannerrecruitment

Number105

Enhancing Lifeplannertraining programs for the newly
employed

100

Enhancing productivity
95

Strengthening consulting sales
approach through developing life
planningliservices
i

90

85
FY08

FY09

FY10

Providing optimal insurance products
in response to the changing needs ofeach customer by strengthening aftersales follow-up services

Sony Financial Holdings Inc. All Rights Reserved11Sony Life: Independent Agent Channel
 Insurance sales via independent agents represent approx. 25% of all new policies
 Enhance tie-ups with independent agents, reflecting diverse customer needs and various accesspoints with customers to strengthen independent agent channel
New policy amount by channel(Individual life insurance + Individual annuities)（ FY10 ）Independent
Agent Channel
Approx.
25%

Tie-ups with various types of independent agents

Enhancing tie
tie-ups
ups with core independent
agentsIndependent agents run by ex-sales
experts of life insurers
Nationwide shop-styleindependent agentsCommunity-based shop-styleindependent agents

Lifeplanner Channel

Exploring new agent models

Approx.
75%

Insurance agents in corporate group
Directly-run
Directly
run agentsSony Financial Holdings Inc. All Rights Reserved

Banking agents12

Sony Life: Senior Market Initiatives
 To make steady inroads in the senior market, which is slated for growth, establish a

 成長が見込まれるシニア市場を確実に捕捉するため、シニア向けライフプランニングの確立と、

system for senior life planning and expand offerings of products and services tailored toよりシニアニーズに特化したサービス・商品の拡充を実施・検討
thespecific needs of senior customers
Establish and promote life planning thatmeets the needs of the senior market

Expand portfolio of product and service offerings
tailored to senior market needs

Four Demands for Money among Seniors

LivingEnjoyment

Money needed fory y life: food,,
everydayclothing, housing, etc.

Money for hobbies andother things that makelife more enjoyable

Safety net

LeavebehindMoney to set aside forcontingencies, such as
three major diseases,
nursing care

Money to leave behind
for the important
people in your life

Augment
Set aside money that is notneeded immediately, investingin accordance with individual
risk tolerance

Expand annuities business through
AEGON Sony LifeLife
insurance
products
Whole life
insurance
Endowment
insurance
Comprehensive
medicalinsurance
Living benefit
insurance
Canceriinsurance
Whole life
nursing-careinsurance＋

Through alliance with Watami, etc.,
increase portfolio of new service offerings
that go beyond life insurance products

By enhancing synergies within the Group,
provide a host of senior-oriented products
and services (possibilities for the future)

OthersSony Financial Holdings Inc. All Rights Reserved13Sony Life: Operational Improvements Launch a new sales support system in 2012, and shift to paperless operations andleverage IT strengths to raise operating efficiency and enhance customer service
Improve work flow through shift to paperless operations

Manage customer information to enable lifelong marketing

Previous processes generated mountains of paperwork

Rather than unilateral, sporadic after-sales follow-up,

Customers

Branches

Back office？？

Improve efficiency through electronic/paperless documents

Customers？？

Use IT to allow long-term, comprehensive after-sales follow-up

Back office

Faceto-face
PostSigningSpecialized
terminal

Screening

Phone
W b
Web

Submit data
immediately
after signing
Application
dataSony Financial Holdings Inc. All Rights Reserved

Customerdatabase

Information for
after-sales
follow-up

14

Sony Life: Asset Stability and ALM
 Achieve stable MCEV growth and structure portfolio that is highly resistant to declines instock prices and interest rates.
Breakdown of general account assets

Japanesepgovernmentand corporate
bonds
62 9%
62.9%

08.3.31

Change in assumptionCBsstocks / real estate market
value fluctuation:10% decrease(4%)

Japanesestocks11.3.31 MCEV ¥853.6 billion

Change in assumption
1.5%

0.0%

11.2%
11.3.31

Rate of change
(35%)

6.2%
18.1%

08.3.31 MCEV ¥816.5 billion

Interest rates: 100bp decrease

87.3%

12.8%

MCEV sensitivities

OthersRate of changeInterest rates: 100bp decrease(13%)

stocks / real estate market
value fluctuation:10% decrease(2%)※ Interest swap rates are used for the sensitivity analysis.

Sony Financial Holdings Inc. All Rights Reserved15Sony Life: Mid-term Target

At the end of
FY2010(Actual)

Policy Amount in Force(Individual Life Insurance +Individual Annuities)

¥34.7

•The
Th figure
fi
is
i for
f SonySLife
Lif only.
l•JGB yields are used as discount rate for

the MCEV calculation

ＣＡＧＲ
Approx. 4%

trillion

Over

MCEV

At the end of
FY2013(Target)¥900.0ＣＡＧＲ
7 5% 8 0%
7.5%-8.0%¥39 trillionOver¥1.1 trillion

billionNumber of Lifeplanner
sales employees

4,017

Approx. 300
increaseSony Financial Holdings Inc. All Rights Reserved

4,300

16

Sony Assurance: Pillars of Growth

Lead the direct
insurance market

・Establish an unassailable position in the expanding
market for direct insurance

Superior profitability

・Low
Low operating expense ratio unique to direct
insurance
・Low loss ratio through risk segmentation unique toSony Assurance

High customer
satisfaction
Increase use of the
web and expanded
functionality

・Achieve consistently high marks in third-party
customer satisfaction rankingsg・Improve service quality to enhance customer
satisfaction
・Expand contracts via the web and mobile routes
・Restructure systems to expand web functionality
and achieve higher system maintenance efficiency
・Strengthen mobile services to enhance contract
process

Sony Financial Holdings Inc. All Rights Reserved17Sony Assurance:
Lead the Direct Insurance Market
 Establish an unassailable position in the expanding market for direct insurance
Direct premiums written bymajor direct insurers

Auto insurance market & share of
direct non-life insurers(Billion of yen)（Billions of yen）

4,000

80

FY10: 5.6% (+0.4pt YoY)

8%

Sony
A

70
3,500

7%

C
60

3,000

5.6% 6%
4.7%
4.3%
3.9%
3 6%
3.6%
3.3%

2 000
2,000

E

50

G

5%

40
4%

30

2.8%

1,500

D
F

5.2%
2,500

B

3%

2.3%
1,000

500

1.7%
1.1%
0.7%
0.3%
0.0%

2%
Direct premiums written(Overall Japanese market)
Share of direct insurers

0

1%

0%
FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10

20

10

0
FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10

Source: Materials officially disclosed by individual insurers

Sony Financial Holdings Inc. All Rights Reserved18Sony Assurance: Superior Profitability
 Maintain the low operating expense ratio unique to direct insurance and the low loss ratio
through risk segmentation unique to Sony Assurance
40%

Combined ratio(Net expense ratio + net loss ratio)

Net expense ratio

D
B
C
A
E

35%

30%

Sony

110%
C
B
E
A
D

100%

25%
FY04 FY05 FY06 FY07 FY08 FY09 FY1080%Sony (E.I.)

Net loss ratio
C
E
B
A

70%

D

90%
Sony (Net loss)

Sony (Ｅ.Ｉ.)

Sony (Net loss)

60%

80%
FY04 FY05 FY06 FY07 FY08 FY09 FY1050%
FY04 FY05 FY06 FY07 FY08 FY09 FY10Sony Financial Holdings Inc. All Rights Reserved

Source: Materials officially disclosed by individual insurers

19Sony Assurance: High Customer Satisfaction
 Achieve consistently high marks in thirdparty customer satisfaction rankings

Nikkei Business, July 25, 2011 edition, 2011 After-Sales
Service Customer Satisfaction Ranking, No. 1 inautomobile insurance
insurance, in the Insurance Division Improve service quality to enhancecustomer satisfaction
・Customer feedback response service and challenge
to eliminate points of dissatisfaction
・First provider of direct insurance to declareconformity with ISO 10002

Association of Service Industry Productivity, Fiscal 2010
Japanese Customer Satisfaction Index, No. 1 forautomobile insurance in the nonnon-life
life insurance industry

Oricon Fiscal 2011 Customer Satisfaction Ranking,Overall No. 1 ranking
g for automobile insurance

J.D. Power, 2011 Japanese Automobile Insurance
Customer Satisfaction, No. 2 in the direct category,No. 3 for satisfaction on accident response
Help Desk Institute, 2010 Help Desk Rating Survey,
Three-Star Evaluation (Sony Assurance the only
company in the non-life insurance division)

Sony Financial Holdings Inc. All Rights Reserved20Sony Assurance:
Increased Use of the Web and Expanded Functionality
 Expand contracts via the web and mobile routes
 Restructure systems to expand web functionality and achieve higher system maintenanceefficiency
 Strengthen mobile services to enhance contract process
Increasing
g contracts via internet
Number of contracts of automobile insurance
by contract channel
10,000contracts

Strengthengmobile services
Expanding application functionality
for smart phone users

150

Sony Assurance’s
applications for smart phone users*Trouble Navi

100

What you'd
you d do if you got a
traffic accident
Via Internet

Navigation for the car breakdown
and the related troubles

50*Driver’s Navi
Via telephone operators

Safe driving support
F l consumption
Fuelti anddmaintenance navigation

0
FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10Sony Financial Holdings Inc. All Rights Reserved21Sony Assurance: Mid-term Targets

FY2010(Actual)Direct premiums
written¥72.8
billionNet expense ratio＋
Ｅ Ｉ loss ratio
Ｅ.Ｉ.

FY2013(Target)ＣＡＧＲ

Over 9%¥94.7
billion

95 2%
95.2%

Over 2pt
improvement

93 0%
93.0%

¥2.14

ＣＡＧＲ

¥4.3

(Total of all types of insurance)

Ordinary profit

billonOver 25%

Sony Financial Holdings Inc. All Rights Reserved

billion22

Sony Bank: Pillars of Growth

Use high customer
satisfaction as the engine
for growth in business
operationsp

Further strengthen
strategic products

Enhance profitprofit
earning capacity

・Further enhance customer satisfaction
・In line with increasing the retail balance, expand
gross operating profit

・Expand currency lineup to build Sony Bank’s
reputation as a foreign currency specialist
・Accelerate business in mortgage loans byenhancing product characteristics andstrengthening channels

・Leverage a business model featuring a low-cost
structuret t
andd expandd th
the bbalancelsheet
h t iin aneffort to boost profits

Sony Financial Holdings Inc. All Rights Reserved23Sony Bank: Pursuit of Customer Satisfaction～ Ranked as the 1st for Nikkei’s customer satisfaction survey on
financial institutions for four consecutive years ～Analysis of customer satisfaction
Customer satisfaction(Overall)100%

CustomerCtsatisfaction
ti f ti(Overall)
100%

90%

90%
Demand for
repeated use

80%

Customer
relations/
Business hours

70%

80%

Demand for
repeated use

70%

60%

60%

Products/
Services

Trustworthiness

FY06（ 3rd）

Products/
Services

Trustworthiness
FY08（ 5th）

FY08（ 5th）

(FY2006 → FY2008)

FY10（ 7th）

(FY2008 → FY2010)

Ranked as the 1st due to its enhanced product andservice lineupsz

Customer
relations/
Business hours

Ranked as the 1st for four consecutive years, by acquiring
higher trustworthiness of customers

Sony Bank has been ranked as the 1st for customer satisfaction
since FY2007 owing mainly to a broader range of product andservice lineups.

zSony Bank maintains the top rating in customer satisfaction byenhancing services and trustworthiness as follows;- an opening of “Housing loan plaza”, the over-the-counter branch inTokyo- an extension of business hours for customer centerz

Aiming for further improvement of products

Source: Nikkei’s customer satisfaction survey (for the three major metropolitan areas)

Sony Financial Holdings Inc. All Rights Reserved24Sony Bank: Expansion of Operations (Retail Balance)
 Achieve linear growth in the retail balance and boost the top line (gross operating profit)

accordingly
Retail balance

Gross operating profit

Personal loans

2,419.6

Investment trusts
Foreign currency deposits

563.3

1 594 4
1,594.4
347.0

1,133.6
284.7

102.9

100.0

(Billions of yen)

77.2

359.2

325.0

14.9

Gross operating profit
10.9

106.4

477.0

16.4

Net interest income
664.0

1,880.7*Breakdowns are on managerial
account basis

N t feesNetfandd commissions
i i2,173.4

Yen deposits(Billions of yen)

Net other operating income

9.0

1.6

0.2

251.7

0.8

0.9

1.8
10.8

1.7

282.1

0.4

12.1

13 7
13.7

15.1

9.2

96.5
147.8
892 6
892.6

1,184.9

1,044.2

1,289.8

7.3

604.4

-3.1

07.3.3108.3.31

09.3.3110.3.3111.3.31

FY06

FY07

CAGR 20.9%

Sony Financial Holdings Inc. All Rights Reserved

FY08

FY09

FY10

CAGR 16.1%

25

Sony Bank: Further Strengthen Strategic Products:(1) Foreign Currency Products
 Build Sony Bank’s reputation as a foreign currency specialist by expanding the foreign

currency business and increasing user convenience
Foreign currency deposits

High market share of foreign currency deposits
8.0%(Trillions of yen)（100 billions of yen)

6

6
Total of domestic banks (left)

6 76%
6.76%

7.0%

Sony bank's share (right))

5
47
4.7

4.8

5.1

3.2
2.8

08.3.31

09.3.31

5.22%

4
4.0%

3.5
3

6.0%

5.96%

5.0%

4.3

4

5

5.83%

7.08%

3

28
2.8
2.5

2

2

07.3.3110.3.3111.3.31

Further developing “Foreign Currency World”
featuresÎ Started handlingg credit cards with dual-currencyy settlement

1.4
1

1

function (Oct. 2008)Î Launched overseas remittance service (Jan. 2010)0

0
07 3 3107.3.3108 3 3108.3.31

09 3 31
09.3.31

10 3 3110.3.31

11 3 3111.3.31

Note1: Source: Statistics of Bank of Japan(Individual foreign currency deposit balance)Î Launched foreign currency delivery service (Jul. 2010)
Î Began offering Brazilian real for foreign currency deposits(May 2011)

Sony Financial Holdings Inc. All Rights Reserved26Sony Bank: Further Strengthen Strategic Products:(2) Mortgage Loans Leverage high-quality mortgage loans to promote business growth (balance sheet) via

asset expansion
Industry-wide mortgage loan balancebalance,Sony Bank’s share and its quality

Mortgage loans
656.0
Web channel
Tie-up channelTihl
Agency channel

Total of domestic banks (total)

555.1

Sony bank's share

468.3

1.18%

1.11%

(Billions of yen)

338.8

0.93%

278 0
278.0
0.63%
0.45%

07.3.3108.3.31

09.3.3110.3.3111.3.31

CAGR 25.4%

Î Opened the over-the-counter branch, called "Housing

Loan Plaza" (Jun. 2010)
Î Began offering mortgage loans for usedcondominiums (Sep. 2010)
Î BeganBoffering
ff i new mortgage
t
Loan,
L
"Variable"V i bl S
Selectl tMortgage Loan" (Aug. 2011)

16

15

15

14

13

FY06

FY07

FY08

FY09

FY10

◆Non-performing loan ratio as of March 31, 2011
(Information disclosure standard of Financial Revitalization Law)
Sony Bank

Mega banks

City banks

Regional
banks

0 38%
0.38%

2 41%
2.41%

1 84%
1.84%

3 03%
3.03%

Sony Financial Holdings Inc. All Rights Reserved

Source: Nikkin Report27Sony Bank: Enhance Profit-earning Capacity Against a backdrop of declining net interest income in the banking industries overall,Sony Bank is achieving steady increases in net interest income as a result of growth in its
business operations (balance sheet)
Maintain growth in net interest income（Billions of yen）

（Trillions of yen）

Sony Bank （ left）

16

Maintain overwhelmingly low deposit expense rate*

Regional banks （ right ）

4.0

1.5%
14

3.29

3.33

3.35

3.26

3.24

12

3.5
30
3.0

1.3%
1.2%

10

2.5

8

15 1
15.1

2.0

12.1

4

1.5

9.2

1.0

7.3

1 18%
1.18%

1 17%
1.17%

1.12%

1.10%

1.13%

1.0%
0.90%

0.8%

0.80%

0.7%

0.85%

0.80%

0.6%

2

0.5

0

0.0
FY06

1.1%

1 18%
1.18%

Regional banks

0 9%
0.9%

13.7
6

Sony Bank

1.4%

FY07

FY08

FY09

CAGR 19.8%

FY10

FY06

FY07

FY08

FY09

FY10

*Deposit expense rate:
A typical indicator of efficiency, obtained by dividing operating expenses by theaverage balance of deposits during the term
term. The lower the rate,
rate the higher is theoperating efficiency.
Source: Nationwide Bank Financial Statement Analysis, Japanese Bankers Association

Sony Financial Holdings Inc. All Rights Reserved28Sony Bank: Mid-term Targets

FY2010(Actual)Retail balance¥2.41(Fiscal year-end balance)

trillion

Gross operating
profit¥16.4

Ordinary profit

billion¥3.3
billion

FY2013(Target)ＣＡＧＲ

Over 10%

ＣＡＧＲ

O
Over
20%

ＣＡＧＲ

Over 40%¥3.49
trillion¥28.6
billionover¥10.0
billionSony Financial Holdings Inc. All Rights Reserved29Mid-term Management Targets(Consolidated)

Sony Financial Holdings Inc. All Rights Reserved30Mid-term Management Targets (Consolidated)(1) Revenues and Profit
 Consolidated ordinary revenues are expected to grow while profit are expected to steadily

expand after a drop in profit in FY2011 and a shift to a profit structure less influenced byfinancial market conditions.
(Billi(Billions
off yen))

Consolidated
ordinary revenues
Consolidated
ordinary profit
Consolidated
net income

FY2010((Actual))

FY2011((Forecast))

1 002 2
1,002.2

1 022 01,022.0

ＣＡＧＲ

７６.８

５９.０

ＣＡＧＲ

４１.７

２９.０

ＣＡＧＲ

Sony Financial Holdings Inc. All Rights Reserved

FY2013((Target)
g )

6%+

13%+

15%+

1 156 01,156.0

76.0

39.0
31

Mid-term Management Targets (Consolidated)(2) Consolidated Adjusted ROE
 Target consolidated adjusted ROE of 7.5-8.0% in FY2013 due mainly to an expected

expansion in MCEV at Sony Life
FY2010(Actual)Consolidated Adjusted ROE

FY2013(Target)(3.1%)

7.5-8.0%

Sony Life (non-consolidated)(3.8%)

7.5-8.0%

Sony Assurance

5.5%

10-11%

Sony Bank (consolidated)

2 7%
2.7%

7 0 -8.0%
7.0
-8 0%

of which

Note: Calculation of consolidated adjusted ROE is as follows. As for the calculation of MCEV for FY2010 (actual), Sony Life uses
interest swap rates as discount rate; whereas it uses JGB yields for FY2013 (target).
Numerator
Sony Life（Non-consolidated）
Sony AssuranceSony Bank（Consolidated）

Denominator

Net increase in MCEV
plus dividends

The average of (MCEV at previous fiscal year-end minus
dividends plus MCEV at current fiscal year-end)

Net income+ increase in provision for catastrophe
reserve (after tax)+ increase in reserve for pricefluctuations (after tax)

The average of (net assets + catastrophe reserve (after-tax)
and reserve for price fluctuations (after-tax)) as of the previous
fiscal year-end and the current fiscal year-end

Net income

The average of net assets as of the previous fiscal year-end
and the current fiscal year-end

Sony Financial Holdings Inc. All Rights Reserved

32Capital Policies and Dividends
 Maintain Group policy of providing stable dividends while ensuring financial soundness

and retaining profit for future growth

Capital Policies(Reference)
Actual as of March 31, 2011

Mid-term Policy
So y LifeSonye(non-consolidated)
Sony AssuranceSony Bank(non-consolidated)■No need for capital injection■Conduct ongoing risk management which has been incorporating
possible tightening of capital requirements based on economic
value in future.

Solvency
margin ratio*

growth, ensure soundness which is■ In preparation for future g
consistent with levels ultimately required by Basel III. Also
consider Tier 1 and Tier 2 balance from standpoint of capitalefficiency.

Capitaladequacy ratio

1 720 0%1,720.0%
631.0%

10.84%* Cabinet Office Ordinance No. 23 of 2010 and FSA public ministerial announcement No. 48 of 2010 prescribe a revision in the methods of calculating total solvency margin and total risk(increasing the strictness of margin inclusion, and its sensitivity). These changes are to be applied from the end of FY2011. The figures for Sony Life and Sony Assurance stated in the table
above (Actual as of March 31, 2011) are calculated according to these assumptions.

Dividends(Reference) Dividends
Mid-term Policy■ Maintain stable dividends for the foreseeable future.
■ Conduct an ongoing review on the dividend level, keeping
in mind the direction toward increasingly stringent capital
regulations.

FY2010 (Actual)

FY2011(Forecast)

Total dividends,
full fiscal year

¥8.7 billion¥8.7 billion

Di id d per share
Dividendh¥4 000¥4,000¥20**** Figure reflects a 1:200 stock split in April 2011

Sony Financial Holdings Inc. All Rights Reserved

33

Key Messages

SFH Group Mid-Term Business Developments
Realizing a Stable Management Structure andAchieving Sustainable Growth
Expanding revenues for the three main businesses( g(Targetingg annual growthgin consolidated ordinary
y revenues
of 6%+ by FY2013)

Growing profit indicators at 10%+ pp.a.
a by FY2013
FY2013, following an
expected drop in profit due to lower gains on sale of securities in
FY2011
Realizing high capital efficiency while maintaining
financial soundness(Targeting consolidated adjusted ROE of 7.5–8.0% in FY2013)
Sony Financial Holdings Inc. All Rights Reserved

34

APPENDIX

Sony Financial Holdings Inc. All Rights Reserved

35

FY2011 1Q Review for Sony Life
Number and amount of new policies(Individual life insurance + Individual annuities)

Number and amount of policies in force(Individual life insurance + Individual annuities)
Policy amount in force

New policy amount(Trillions of yen)

15,000
1.5

Number of new policies(Thousands of policies)

155(Trillions of yen)
+6.4%

(3.6%)
50

150

144

Number of policies in force(Millions of policies)

5.09

5.34

5.42
+1.5%
5

40

1 06
1.06
10,000
1.0

33.8

1 05
1.05
100

0.93

+3.7%

35.0

34.7

4

+0.9%
30

(1.0%)

3

20

2

5,000
0.5
10

0

0
FY09.1Q

FY10.1Q

FY11.1Q

Line item amounts are truncated below ¥10 billion; numbers of policies aretruncated below 1,000 policies; percentage change figures are rounded.

1

0

0

10.6.30

11.3.3111.6.30

Line item amounts are truncated below ¥100 billion; numbers of policies aretruncated below 10,000 policies; percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

36

FY2011 1Q Review for Sony Assurance
Net premiums written andnumber of policies in force
Voluntary automobile insurance

Net expense ratio +Earned/Incurred loss ratio

Personal accident insurance(Millions of policies)

Number of policies in force

Other

+8.0%

30
(Billi(Billions
off yen))

1.41

91.9

17.3

0.1

18 8
18.8
1.8

1.8

0.2

1

66.4

60

69.7
65.8

(1.1pt)

65.3

62.3

0.8

18.1
16.8

40

06
0.6

15.4

0.4

20

26.1

25.5

+0.7pt

24.6

23.9

24.6

FY09.1Q

FY10.1Q

FY11.1Q0.2
00
FY09.1Q

89.9

1.2

20.2

1.7

10

90.3
86.9

80

+7.1%

0.1

(0.4pt)

95.2

14
1.4

1.19

Net expense ratio

（％）
100

1.30

20

Earned/Incurred loss ratio

FY10.1Q

FY11.1Q

The number of policies in force is the total of automobile insurance and medical and cancer
insurance policies, which account for 99% of net premiums written. More than 90% of
personal accident insurance is medical and cancer insurance.

0
FY09

FY10

Earned/Incurred loss ratio is equal to the ratio of the sum of net losses paid, loss adjustment
expenses and accumulation in provision for reserve for outstanding losses to earned premiums
premiums.
*Note that earthquake insurance and compulsory automobile liability insurance are excluded
from the above calculation.
Net expense ratio is equal to the ratio of total underwriting costs to net premiums written.

Sony Financial Holdings Inc. All Rights Reserved

37

FY2011 1Q Review for Sony Bank
Customer assets (deposits + investment trusts)
and number of accounts
Yen deposits
Foreign currency deposits
Number of accounts (thousands)(Billions of yen)809

Investment trusts

Loans
Mortgage loans

Others*Including corporate loans of ¥64.4 billion.

(Billions of yen)
+10

859

869

+25.8

748 3
748.3

800

722.4

2,000

1,755.5
1,613.0

1,772.2
+16.6

72.1*

600.9

107.6
600

1,500

365.0

400

1,000

Deposits
total:

676.1

1,664.5
1,299.4
500

200

0

0

10.6.30

11.3.3111.6.30

10.6.30

11.3.3111.6.30

Line item amounts are truncated below ¥100 million; number of accounts are truncated below 1,000 accounts.

Sony Financial Holdings Inc. All Rights Reserved

38

Contact:
SFH

Corporate Communications & Investor Relations Department
Sony Financial Holdings Inc
Inc.
TEL： +81-3-5785-1074

Sony Financial Holdings Inc. All Rights Reserved