Content

During the six months ended September 30, 2014 (April 1 to September 30, 2014),
consolidated
lid t d ordinary
direvenues iincreased
d55.2%2% comparedd withith th
the same periodi d off th
theprevious fiscal year, to ¥643.0 billion, owing to increases in ordinary revenues from all thebusinesses: life insurance, non-life insurance and banking.
Consolidated ordinary profit increased 27.6% year on year, to ¥46.9 billion.
By business segment, ordinary profit from the life insurance and the non-life insurance
businesses increased, whereas ordinary profit from the banking business decreased.
Consolidated net income was up
p 49.3% yyear on yyear, to ¥31.1 billion, reflecting
g the rise inordinary profit, and the change of the calculation policy of the reserve for price fluctuationsfor Sony Life. The change was to accumulate the reserve up to required levels from FY14
while it had accumulated the reserve in excess of the required levels until FY13.

Sony Life’s ordinary revenues increased 5.4% year on year, to ¥579.3 billion, due to ani
increaseini incomei
ffrom insurancei
premiumsireflecting
fl ti a steadyt d iincrease iin policyliamount in force and higher interest income and dividends on general account assets.
Ordinary profit increased 29.2% year on year, to ¥40.4 billion due mainly to two reasons:the absence of the negative impact from the revision of the discount rate used for
calculating policy reserves on the interest rate-sensitive whole life insurance that waspresent in the same period of the preceding fiscal year, and an increase in gains onsales of securities in the general account in this first half
half.
Net income increased 52.3% year on year, to ¥26.9 billion year on year reflecting
the rise in ordinary profit, and the change of the calculation policy of the reserve forprice fluctuations. The change was to accumulate the reserve up to required levels
from FY14 while it had accumulated the reserve in excess of the required levels
until FY13.

(Left-hand graph)
New policy amount for the total of individual life insurance and individual annuities for thesix month ended September 30, 2014, increased 13.5% year on year, to ¥2,127.3 billion,due to a brisk sale of U.S. dollar denominated insurance which was launched in May
2013, as well as strong sales of variable life insurance, term-life insurance and family
income insurance in line with efforts to strengthen sales of death protection-type
products.
The number of new policies increased 15.9% year on year to 286 thousand policies.
(Right-hand graph)
Annualized premiums from new policies for the six month ended September 30, 2014,
increased 20.0% year on year, to ¥36.2 billion, due to higher sales of endowment
insurance, educational endowment insurance, variable life insurance, term-life insuranceand U.S. dollar denominated insurance.
Of which,which the figure for third-sector
third sector insurance products was down 55.1%
1% year on year
year, to¥6.5 billion.

(Left-hand graph)
Policy amount in force for the total of individual life insurance and individual annuities
increased 4.2% year on year, to ¥39,952.7 billion, due to an increase in
new policies and a low lapse and surrender rate.
The number of policies in force increased 5.4% year on year, to ¥6.49 million policies.
(Right-hand graph)
Annualized premiums from insurance in force increased 5.0% year on year, to¥715.4 billion. Of this amount, the figure for third-sector products was up 2.9%
year on year, to ¥169.7 billion.

The lapse and surrender rate for the six month ended September 30, 2014, decreased
0 11 percentage
0.11
tpointi t year on year, tto 2
2.21%,
21% ddue tto th
the llowering
i llapse andd surrender
drate in each product.

(Left-hand graph)
Income from insurance premiums increased 3.7% year on year, to ¥454.0 billion, owing
to steady growth in policy amount in force.
(Right-hand graph)
Interest income and dividends was up 11.7% year on year, to ¥65.8 billion, due to anexpansion in investment assets along with business expansion.

(Left-hand graph)Core profit was up 14.9% year on year, to ¥38.5 billion, due mainly to the absence of thenegative impact from the revision of the discount rate used for calculating policy reserves
on interest rate-sensitive whole life insurance that was present in the same period of thepreceding fiscal year and an increase in positive spread, despite the negative effect of anincrease in provision of policy reserves for minimum guarantees for variable life
insurance.
(Right-hand graph)
Ordinary profit increased 29.2% year on year, to ¥40.4 billion, due mainly to an increasein gains on sales of securities in the general account as well as the increase in coreprofit.

The number of Lifeplanner sales employees as of September 30, 2014, was 4,248, up 20
ffromJJune 30,30 2014 andd up 123 ffrom S
Septembert b 30
30, 2013
2013.
The number of Lifeplanner sales employees steadily increased, reflecting Sony Life’sinitiatives to appoint skilled personnel in this category as sales office managers responsible
for recruiting new Lifeplanner sales employees.

As Sony Life continued its investment in ultralong-term bonds, the holding ratio on thereall status,t t
off JJapanese governmentt andd corporatet bbonds
d iincluding
l di ththose iinvestedt d iinmonetary trusts was 91.1% as of September 30, 2014.
Sony Life’s holding ratio of real estate in general account assets was up as Sony Life has
acquired Sony Corporation’s headquarters site in September 2014.

As of September 30, 2014, Sony Life’s non-consolidated solvency margin ratio was2 510 4% up 151
2,510.4%,
151.7
7 percentage
tpointsi t ffrom M
Marchh 31
31, 2014
2014, remaining
i i att a hihighh llevel.
lOperating results of AEGON Sony Life Insurance, which sells individual variableannuities,iti
are shownhhere.
hSales of individual variable annuities decreased compared with the same period of theprevious fiscal year. Behind this drop was the fact that brisk sales of individual variableannuities were seen due to a favorable stock market in the preceding year.
However, the business scale itself has been expanding along with steady growth inpolicy amount in force.

Sony Assurance’s ordinary revenues increased 3.4% year on year, to ¥46.4 billion, due toan increaseiin
i nett premiums
iwrittenitt primarily
iil forf its
it mainstay
i t automobilet
bil insurance.
i
Ordinary profit increased 19.6% year on year, to ¥3.4 billion, due to a decline in the loss ratio
mainly led by a lower car accident ratio, as well as the rise in ordinary revenues.
Net income increased 29.4% year on year, to ¥2.3 billion.

(Left-hand graph)
The number of policies in force for the total of automobile insurance and medical andcancer insurance steadily increased 5.3% year on year, to 1.65 million policies.
Net premiums written increased 3.3% year on year, to ¥45.7 billion due to a stable saleof automobile insurance.
(Right-hand graph)
OrdinaryO
diprofit
fit iincreasedd 19
19.6%
6% year on year, tto ¥3.4
¥3 4 billi
billion ddue tto a ddecline
li iin th
the lloss
ratio as described in the previous pages.
We also show you adjusted ordinary profit in addition to ordinary profit on the graph.
Adjusted ordinary profit is an profit indicator on a managerial accounting basis. The
figure is calculated by adjusting the amount of provision(reversal) for catastrophe reserveto ordinary profit.
Adjusted ordinary profit also increased year on year, to ¥4.8 billion.

(Left-hand graph)
For the six month ended September 30, 2014, the E.I. loss ratio declined 3.5 percentage
points year on year, to 62.4 %, mainly led by the revision of premium rates forautomobile insurance and a lower car accident ratio owing to the introduction of a new
bonus-malus system (non-fleet driver rating system).
The net expense ratio rose 0.8 percentage point year on year, to 25.4%, due mainly tohigher system-related expenses and a rise in insurance acquisition cost and a
consumption tax rate rise.
Consequently, the sum of the E.I. loss ratio and the net expense ratio declined 2.7
percentage points year on year, to 87.8%.
(Right-hand graph)
The net loss ratio declined 3.2 percentage points year on year, to 56.4%. This is different
from the E.I. loss ratio, which reflects an increase or a decrease in provision for reservefor outstanding losses.
losses
The combined ratio (the sum of the net loss ratio and the net expense ratio) declined 2.4
percentage points year on year, to 81.8%.

As of September 30, 2014, Sony Assurance’s non-consolidated solvency margin ratio
was 596.3%,596 3% up 68
68.77 percentage
tpointsi t ffrom M
Marchh 3131, 20142014.

Sony Bank’s consolidated ordinary revenues increased 1.9% year on year, to ¥18.6billi
d tgains
hi hfrom bond-dealing
i fb dtransactions.
d li tti
C
lid t dbillion,duei to higher
Consolidated
ordinary profit decreased 9.1% year on year, to ¥3.2 billion due mainly to two reasons:lower volume on foreign exchange transactions stemming from passive foreign currency
trading by customers compared with the same period of the previous fiscal year when
foreign currency exchange rates fluctuated wildly, and an increase in operating expenses.
On a non-consolidated basis, Sony Bank’s ordinary revenues increased while ordinary
profit decreased as the same reason as in the consolidated results.
Gross operating
Gti profit
fit ddecreased
d3
3.2%
2% year on year, tto ¥10¥10.6
6 billibillion, ddue mainly
i l tto adecrease in net interest income. Behind this drop was lower interest income on securities
under the lowering interest rates.
Net operating profit decreased 17.4% year on year, to ¥3.1 billion.

We break down gross operating profit on a managerial accounting basis to facilitate anunderstandingd t di off operationalti
l sources off revenues andd profits.
fit(Left-hand table)
Net interest income on a managerial accounting basis remained at the same level as thesame period of the previous year, amounting to ¥9.0 billion, due to an improvement in
net interest income on foreign exchange transaction despite lower interest income on
securities under the loweringg interest rates.
Net fees and commissions decreased, to ¥0.4 billion year on year, due to lower volumeon foreign exchange transactions stemming from passive foreign currency trading bycustomers.
Consequently, gross operating profit on a core profit basis decreased ¥0.5 billion year onyear, to ¥9.0 billion, and net operating profit on a core profit basis also decreased ¥0.7
billion year on year, to ¥1.6 billion.
(Right-hand graph)
The interest spread for FY14.1H was 0.91%, which maintained a certain level.

(Left-hand graph)
A off S
As
Septembert b 30
30, 2014
2014, ddepositsit (th(the sum off JJapanese yen andd fforeigni currencydeposits) amounted to ¥1,824.6 billion, down ¥65.3 billion from March 31, 2014. Of
which, yen deposit balance decreased ¥42.6 billion from March 31, 2014, to ¥1,483.8
billion under persistently low interest rates.
Foreign currency deposit balance amounted to ¥340.8 billion, down ¥22.7 billion fromMarch 31, 2014, due to an increase in selling to lock in profits led by yen depreciation.
( g(Right-handgraph)
gp )Loan balance as of September 30, 2014 expanded to ¥1,092.1 billion, up ¥34.6 billion
from March 31, 2014, due to the growing balance of mortgage loans.

(Left-hand graph)
As of September 30, 2014, the balance of securities amounted to ¥764.7 billion, down
¥9.0 billion from March 31, 2014.
Sony Bank continuously invests in highly rated bonds.
(Right-hand graph)
As of September 30, 2014, Sony Bank’s non-consolidated capital adequacy ratio(domestic criteria) was 11.80%, up 0.08 percentage point from March 31, 2014.
Sony Bank has maintained financial soundness.

Taking into consideration the market fluctuation risk on and after October 1, 2014, ourconsolidated financial forecast remains unchanged
nchanged eeven
en thothough
gh the resresults
lts for this firsthalf exceeded our expectations.
However, we have revised upward our forecast of the non-life insurance business.

Sony Life’s MCEV as of September 30, 2014 increased ¥53.1 billion from June 30,
2014, to ¥1,313.1 billion, due mainly to an acquisition of new policies, a lower inflation
rate and a rise in stock price.
New business value for the six months ended September 30, 2014 was ¥30.3 billion,(¥60.6 billion / annualized), reflecting brisk sales of new policies even in lower interest
rates in Japanese yen, while that for 12 months ended March 31, 2014 was ¥55.2 billion
and that for 3 months ended June 30, 2014 was ¥16.9 billion.
New business margin
g as of September
p30, 2014 was 5.1%, while that as of March 31,
2014 was 5.2% and as of June 30, 2014 was 5.5%.
New business margin as of September 30, 2014, was down from June 30, 2014 due
mainly to lower interest rates in Japanese yen.

The risk amount based on economic value as of September 30, 2014 amounted to¥703 7 billi¥703.7billion. Withi
Within SSony Lif
Life’s’ risks,i k iinsurance riski k andd market-related
k t l t d riski k amountedt dto ¥673.3 billion and ¥279.0 billion respectively.
The risk amount based on economic value as of September 30, 2014, was up from June30, 2014 due mainly to an increase in policy amount in force.
However, Sony Life has maintained high financial soundness by keeping MCEV, whichis capital based on economic value, at a higher level than the risk amount.

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