Presentation Materials

Management Vision of the Sony Financial
Holdings Group for Fiscal Year 2010

Sony Financial Holdings Inc.
June 4, 2010

Sony Financial Holdings Inc. All Rights Reserved0Disclaimers:
These presentation materials contain statements concerning the current plans, expectations, strategies and beliefs of theSony Financial Holdings Group (the “SFH Group”). Any statements contained herein that pertain to future operating
performance and that are not historic facts are forward-looking statements. Forward-looking statements may include—but are
not limited to—words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” “possibility” and similarwords that describe future operating activities, business performance, events or conditions. Forward-looking statements,
whether spoken or written, are based on judgments made by the management of the SFH Group, based on information that iscurrently 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 inthis presentation does not constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer
to buy or subscribe for any securities, nor shall it or any part of it form the basis of or be relied on in connection with any
contract or commitment whatsoever.
Sony Financial Holdings Inc. All Rights Reserved

1Today’s Agenda (From 3:00p.m. to 5:00p.m.) Opening
Teruhisa Tokunaka

President, Representative Director of Sony Financial Holdings Inc.

 Our Vision of Group Management for FY2010
Katsumi Ihara

Executive Vice President, Representative Director ofSony Financial Holdings Inc.
Taro Okuda
President, Representative 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.

 Question and Answer Session

Sony Financial Holdings Inc. All Rights Reserved2Sony Financial Holdings

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3

FY2009 Review

Sony Financial Holdings Inc. All Rights Reserved

4

FY2009 Review
Consolidated Operating Performance
FY08

FY09
change(Billions of yen)

Ordinary revenues

Ordinary profit

Life insurance
business

978.9
860.3

Non-life
insurancebusiness+13.8%

Bankingbusiness

Corporate andelimination+ 146.3%

84.3
Consolidated

34.2

FY08

FY09

Consolidated（Billions of yen)

Ordinary
revenues

766.2

882.0

+115.8+15.1%

Ordinary profit

32.5

79.7

+47.2

+145.2%

Ordinary
revenues

61.8

68.1

+6.2

+10.2%

Ordinary profit

2.1

2.5

+0.3

+17.8%

Ordinary
revenues

33.3

30.5

(2.8)

(8.6%)

Ordinary profit

(0.5)

1.9

+2.5

－

Ordinary
revenues

(1.1)

(1.7)

(0.5)

－

Ordinary profit

0.1

0.0

(0.0)

(7.8%)

Ordinary
revenues

860.3

978.9

+118.6+13.8%

Ordinary profit

34.2

84.3

+50.1

+146.3%

Net income

30.7

48.1

+17.4

+56.7%(Billions of yen)

09.3.3110.3.31

Total assets

5,313.6

6,001.0+687.4+12.9%Net assets

204.8

269.4

+64.5

+31.5%

Change from09.3.31

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

5

FY2009 Review
Sony Life’s MCEV

08.3.31(Billions of yen)

09.3.3110.3.31

Change from09.3.31

816.5

400.9

894.0

＋493.1

Adjusted net worth

248.5

195.4

206.2

＋10.8

Value of existing
business

568.0

205.4

687.8

＋482.4

48.2

15.4

55.6

＋40.2

MCEV

Of which, New business

value

Sony
SonyLife’s
Life’sMCEV
MCEVasasof
ofMarchMarch31,
31,20102010increased
increased¥493.1¥493.1billion
billionfrom
fromMarch
March
31,
31,2009.
2009.
9Operating
9OperatingMCEV
MCEVearnings
earnings
9Economic
9Economicvariances
variances＋¥273.3＋¥273.3billion
billion＋¥227.0＋¥227.0billion
billionSony
SonyLife
Lifehashasworked
workedwith
withtasks
tasksrecognizedrecognizedfrom
fromthethe MCEVMCEVresults
resultsas
asofofMar.
Mar.
31,
31,2009,2009,focusing
focusingon
ontasks
taskssuch
suchasasreducing
reducingthe
theduration
durationmismatchmismatchrisk
risk
betweenbetweenassets
assetsandandliabilities.
liabilities.
Sony Financial Holdings Inc. All Rights Reserved

6Progress Review for
Business Challenges

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7

PROGRESS Review Sony Life
Theme

Steadygrowthin MCEV

Strategic focuses announced
in the past

Progress Review (FY09)① Reduce interest rate risks(Lengthening asset duration, etc.)② Review product details, etc.

①・Ratio of Japanese government and corporate
bonds in general account assets (excl. CBs)
08.3.31: 62.9% ⇒ 10.3.31: 84.6%
・Asset duration
08.3.31: 8.7 years ⇒ 10.3.31: 17.6 years②・Constructed a product development system inreviewing the impact on MCEV・Changed asset management policy in certain
products[Management Vision of SFH Group for FY09]

Expansionof saleschannels○Target the number ofLifeplanner sales employees of
4,000 by the end of FY10○・Number of Lifeplanner sales employees
08.3.31: 3,779 ⇒ 10.3.31: 4,036(Reached the target one year earlier)[Management Vision of SFH Group for FY08]

Expansionof businessdomains① Develop annuity business② Enter into the life insurance
market in Greater China[Management Vision of SFH Group for FY09]①・AEGON Sony Life Insurance started
business operations (Dec. 2009)
・Established a reinsurance company as a
joint venture with AEGON (Oct. 2009)②・Opened a representative office in Taipei(Jul. 2009)
Started to research business opportunities
following opening an office in BeijingSony Financial Holdings Inc. All Rights Reserved

8

PROGRESS Review Sony Assurance
Theme

Expansionof business
scale

Strategic focuses announced
in the past

○FY10
Direct premiums written:¥70 billion

Progress Review (FY09)○・Direct premiums written
FY07: ¥54.6 billion ⇒ FY09: ¥67.1 billion(Steadily growing to the target of ¥70.0 for FY10)[Management Vision of SFH Group for FY08]

Improvementof businessefficiency○Expand new policies contracted
via Internet○・Increasing ratio of contracting new policies via
Internet reached record high・Acquisition cost of new policies decreased due
to a declined personnel expense ratio, etc.

[Management Vision of SFH Group for FY09]

Enhancementof marketing
capabilities○Enhance sales channels○ ・Sales over the bank counter: Increasing
number of tie-up banks
・Number of new policies via non-life insurancecomparison website: +22% (YoY)[Management Vision of SFH Group for FY09]

Sony Financial Holdings Inc. All Rights Reserved

9PROGRESS Review Sony Bank
Theme

Pursuit ofcustomersatisfaction

Strategic focuses announced
in the past

○Establish the leading positionin customer satisfaction[Management Vision of SFH Group for FY09]

Serviceofferingfrom thecustomer
viewpoint○Develop securities products
and services, preparing for themarket upturn

Progress Review (FY09)○・Nikkei financial institution ranking(in customer satisfaction)
Top for the three consecutive years
Highly appreciated in “High capabilities to offer
fund investment and mortgage loan products”○・Aug 2009: Started “Margin trading”
・Dec 2009: Started “Contract for Difference”
・Jan 2010: Started “Stock trading throughmobile phone”[Management Vision of SFH Group for FY09]

Raise
profitability○Secure stable profit sourceby diversifying fund investment
methods[Management Vision of SFH Group for FY09]○・Sep 2009: Established a new businessdepartment to start “Syndicated loan business”
・ Loan-deposit rate(based on Japanese yen deposit)
08.3.31: 39% ⇒ 10.3.31: 50%

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10Enhancing Corporate Value

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11Stance on Enhancing Corporate Value
FuturePresent3) Entry into new businessdomains

Sustainable growth ofbusinesses withconfidence2) Group synergies

1) Sustainable growth in
three core existing
businesses

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12Sustainable Growth Sony Life
Changes in Policy Amount in Force(Individual life insurance)

Strength(Trillions of yen)

■ Sales force with high consulting capabilities centering on
Lifeplanner sales channels■ Customized product designing to meet customer needs■ Sustainable growth through the original business model
against the industry’s declining sales of death protection
insurance products

1,400

1,200

Total of all insurers(Left axis)
Sony Life (Right axis)

60

50

1,000
40
800
30

Growth Potential

600
20
400

□ See high growth potential considering from the current market
share in the domestic life insurance market of 3.6%
(based on policy amount in force) as of Dec. 31, 2009200

Sony Life’s growthtrend in the declining
market in the industry

0

10

0

04
.3
.3
1
05
.3
.3
1
06
.3
.3
1
07
.3
.3
1
08
.3
.3
1
09
.3
.3
1
09
.1
2.
31

□ Focus on death protection insurance with which consultingbased sales methods are the most effective, whilestrengthening the field of living benefit protection insurance

Note: Prepared by Sony Life based on materials officiallydisclosed by individual insurers

Sony Financial Holdings Inc. All Rights Reserved

13Sustainable Growth Sony Assurance
Strength

Average Premiums of Auto Insurance (FY08)■ Recognized as the front runner of the direct
automobile insurance market■ Secure appropriate profit margin while selling
reasonably priced premiums and supported by customers■ Offer high quality services Sony Assurance
developed (Always high-ranked in the customer
satisfaction with accident response)(yen)
42,035

Average of the direct
market (excl. Sony
Assurance)
52,000Sony Assurance
Growth Potential
69,890□ High appraisal and support from customers, considering froma double-digit growth rate for direct premiums written□ Acquired a certain level of market share in the expectedfurther expansion in the direct automobile insurance market
in Japan・Percentage of the direct market to the overall auto market
U.S.A. (FY07) approx. 15%
U.K. (FY08) approx. 44%
Japan (FY08) less than 5%<Sources> U.S.A. : Independent Insurance Agents & Brokers of America“2007 Property-Casualty Insurance Market”
U.K. : “The source of premium income 2008”

Average of four mega non-life insurers

Note: Prepared by SFH based on theStatistics of Non-life Insurance Business in Japan (FY2008)

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14

Sustainable Growth Sony Bank
Highly appreciated in customer satisfaction

Strength■ Top ranked in Nikkei financial institution ranking
for the three consecutive years, showing Sony Bank’shigh appreciation from customers

ScoresFinancial
institutions■ Develop a reasonably priced and convenient
product lineups, including securities and foreignexchange-related products, as well as mortgage loans■Low cost business operations as an Internet bankwith a lot of flexibility

In which,reliability

1Sony Bank

89.8

33.1

20.9

2

Internet bank A

86.7

32.5

19.3

3

Newly
establishedbank B

85.4

29.2

19.0

9

Megabank C

82.2

26.9

20.1

10

Megabank D

82.1

26.8

20.2

25

Internet bank E

76.1

26.5

17.3

Growth Potential□ Maintain disciplined growth while responding to thechanges in the financial market environment□ Expand customer base through the promotion with newsales methods and channels for the customers who
Sony Bank has not reached~into the larger market~
・Percentage of the balance of individual customers’
deposits at Internet banks to the total as of Sep. 30, 2009
was still 0.6%.

In which,product& service

Note: Prepared by SFH based on the 6th Nikkei financial institution ranking
Customer satisfaction (Nihon Keizai Shimbun)

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15

Tasks to Enhance Corporate Value
Mid-term Strategic FocusesSony Life■Further strengthening consulting-based sales capabilities■Steadily growing the annuity business and other new businesses■Consistently increasing MCEVSony Assurance■Accelerating the growth by reinforcing operations(through strategic marketing and Web promotion)■Controlling both the loss ratio and the expense ratio at appropriate levels■Continuously strengthening the business infrastructure,including system development

Sony Bank■Continuing disciplined growth in consideration of macroeconomic
environment of financial markets■Pursuing a profit model against the negative market conditions of low
interest rates■Raising cost competitiveness through the operational efficiency

Sony Financial Holdings Inc. All Rights Reserved16Sony Life InsuranceSony Financial Holdings Inc. All Rights Reserved

17

FY2009 Review(1)Operating Performance
New Policy Amount

Lapse and Surrender Rate

(Individual life insurance and Individual annuities)(Individual life insurance and Individual annuities)(Trillions of yen)

(%)

10

5

+4.5%
3.80

4
3.39

3.87

+0.4P

4.05
8

3.43

6.1
5.8

3

6

2

4

1

2

0

0

FY05

FY06

FY07

FY08

FY09

6.8

7.2

5.8
6.4

The assumed figure, of which lapse and surrender of family
income insurance and decreasing term life insurance
remains at the same levels for FY08.

FY05

FY06

Sony Financial Holdings Inc. All Rights Reserved

FY07

FY08

FY09

18

FY2009 Review(1)Operating Performance

Number of LifeplannerSales Employees

Policy Amount in Force(Individual Life Insurance + Individual Annuities)(Trillions of yen)

(Person)

+2.9%

40

30

29.1

30.2

31.5

32.5

5,000

+145

33.4

4,000

3,826

3,776

3,779

06.3.3107.3.3108.3.31

3,891

4,036

3,000
20

2,000
10

1,000

0

0
06.3.3107.3.3108.3.31

09.3.3110.3.31Sony Financial Holdings Inc. All Rights Reserved

09.3.3110.3.3119

FY2009 Review(2) Sony Life’s MCEV as of March 31, 2010
(Billions of yen)
1,000

900

Adjusted net worth

800

Value of exsisting business

700
600
500
400
300
200
100
0

(Billions of yen)

09.3.31

Change10.3.31400.9＋493.1894.0

Adjusted net worth

195.4

＋10.8

206.2

Value of existing business

205.4＋482.4687.8

Of which, New business value

15.4

＋40.2

55.6

MCEV

Sony Financial Holdings Inc. All Rights Reserved20

FY2009 Review (2)Sony Life’s MCEV
Reconciliation analysis from MCEV at the end of the previous fiscal year

＜10.3.31＞＜09.3.31＞<Factor(2)>Increase in interest swap rates(Billions of yen)

+227.0

894.0
(0.2)

<Factor(1)>Impact of the changes to its
asset management policy anddividend policy

+18.4
+55.6
400.9

+215.3

+11.5
(1.0)

393.9

(26.4)(7.0)

Operating MCEV earnings
MCEV Adjustments Adjusted
MCEV
as of
as of
March 31,
March 31,
2009
2009

FY09
New
businessvalue

Expected existing Expected existing
businessbusiness
contribution
contribution(in excess of(risk free rate）
risk free rate）

Experience Assumption
Economic Adjustments
varianceschanges Other variances

Sony Financial Holdings Inc. All Rights Reserved

MCEV
as of
March 31,2010

21

FY2009 Review(3)Profitability (Non-consolidated)

Ordinary revenues+15.1%(Billions of yen)(Billions of yen)

Ordinary profit

881.7

765.9

FY09

FY08

Ordinary revenues

765.9

881.7

+115.8+15.1%

Income from insurance premiums

662.0

700.1

+38.0

+5.8%

Investment income

98.7

175.3

+76.6

+77.6%

Interest income and dividends

55.8

70.6

+14.8

+26.6%

Income from monetary trusts, net

－

22.8

+22.8

－

32.1

15.1

(17.0)(53.0%)

－

62.7

+62.7

－

733.5

801.6

+68.1

+9.3%

Insurance claims and other payments

274.7

274.2

(0.5)

(0.2%)

Provision for policy reserve and others

219.0

395.5

+176.5+80.6%

Investment expenses

133.7

20.5

(113.1)(84.6%)

Losses on sale of securities

16.1

10.0

(6.0)

(37.7%)

Devaluation losses on securities

31.8

－

(31.8)(100.0%)Losses on separate accounts, net

72.2

－

(72.2)(100.0%)

93.9

96.8

+2.9

+3.1%

Gains on sale of securities
Gains on separate accounts, net
Ordinary expenses+147.1%

80.0

32.4
FY08

FY09

ChangeOperating expenses

Sony Life

Ordinary profit

32.4

80.0

+47.6

+147.1%

Ordinary revenues and ordinary profit increased year onyear.
Income from insurance premiums increased due to anincreased policy amount in force.
Investment income rose.
Ordinary profit rose due to increased in ordinary revenues
and a substantial decrease in impairment losses.

Net income

33.7

46.1

+12.3

+36.6%(Billions of yen)

09.3.31

Change from 09.3.31

Securities

2,819.6

3,539.1+719.4+25.5%

Policy reserve

3,592.3

3,985.6+393.2+10.9%

Total net assets

140.7

191.3

+50.5

+35.9%

4.0

15.4

+11.4

+285.0%3,810.9

4,286.5+475.6+12.5%

275.1

373.6

+98.4

+35.8%Net unrealized gains/losses onother securities
Total assets
Line item amounts are truncated below ¥100 million;
percentage change figures are rounded.

10.3.31

Separate account assets

Sony Financial Holdings Inc. All Rights Reserved

22Market Overview and Mid-term Issues
Social Environment¾ Japan’s low birthrate, later marriages/nonmarriages, and aging society, as well as risingconcern over the public security system¾ Stagnant household income and consumer
consumption, resulting in unforeseeable future¾ Diversification in people’s lifestyle, sense of value,
and needs

Market Environment¾ Continuous shift from death protection insurance

to the third-sector and annuity products¾ Diversification of sales channels■Response to a changing market▲Extending protection areas andlaunch of appealing products▲Reinforcing sales channels to securecompetitive superiority▲Reforming the sales and back-officesystems to improve quality ofservices and operational efficiency▲Expanding business domains¾ Rapidly growing insurance market in Asia

■Response to an introduction of valuation
on an economic value basis

Regulatory
Environment¾ Valuation on an economic value basis andintroduction of IFRS
¾ Revision on Solvency regulations¾ Requirement of maintaining comprehensive risk
management systems▲Reinforcing risk management
including a reduction in the duration
mismatch risk between assets andliabilities▲Establishing and utilizing thevaluation method using MCEVSony Financial Holdings Inc. All Rights Reserved

23Mid-term Strategic Focuses

Mid-term
Strategy

Further entrenching our position in the Japanese life insurance market by reinforcing
our competitiveness of consulting-based sales forces mainly through life planning andafter-sales follow-up activities
Maintaining or promoting sustainable growth by expanding our business domains
Consistently increasing corporate value by using MCEV as the criterion

Corporate value<Expansion of business domains>(1) Growing business operations of AEGON Sony Life Insurance(2) Developing overseas businesses* including M&A for expanding life insurance business<Sony Life’s steady growth>(1) Reinforcing our consulting and sales capabilitiesa) Promoting and advancing the life planning sales methodsb) Developing products responding to the lifetime changing needs of protectionc) Reinforcing sales channelsd) Reforming the sales and back-office systems(2) Executing profit control and risk management on an economic value basis
FutureSony Financial Holdings Inc. All Rights Reserved24

(1) Reinforcing our Consulting and Sales Capabilitiesa) Promoting and Advancing the Life planning Sales Methods

Advancing life planning sales methods
for families with small children, ourprimarily targeted customer base, andreinforcing our sales approach to thesenior generation

Death or inheritance
After retirement
Retirement
Adult child

Families with small children(Funding needs in case of thebreadwinner’s death, educational
expenses, mortgage loans, and saving
for life after retirement, etc.)

Nursing care

50’sChild education

60’s◆AEGON Sony Life
Insurance
Individual annuities

Senior generation(Nursing care, pension andinheritance, etc.)

40’s
Home purchaseChildbirth

30’s

Marriage◆Sony Assurance
auto insurance◆Sony Bank
Mortgage loans

Job change

20’s
SchoolJob hunting◆OJT of life planningconsultation for new employees■Tie-up with Watami (Sep. 2006)- Introducing Watami’s nursing
care facilities■Tie-up with Specified Nonprofit
Organization Yuigon Sozoku Legal
Network (July 2009)- expanded services to include
inheritance-related services
through "Legal Consultation with
Lawyers", etc.

◆ Life planning course
Sony Financial Holdings Inc. All Rights Reserved25

(1) Reinforcing our Consulting and Sales Capabilitiesb) Developing Products Responding to the Lifetime Changing Needs of Protection
New policy Amount in the Industry andSony Life’s Market Share(Trillions of yen)

New Product Strategy

3Q 2009: 6.4%
(7.1%, excl. Japan Post Insurance)

Total of all insurers
Sony Life's share Consistent launch of new products with which

consulting-based sales approach is the mosteffective, and enhancement of competitiveness New products launched in FY09
 Cancer hospitalization insurance (Apr. 2009)
 Discount rider for nonsmokers and otherpeople in excellent health for family income
insurance (Nov. 2009) New products planned to be launched in FY10
 Nursing care product (Second half of FY10)
 New discount rider for decreasing term life

insurance (Second half of FY10)(Source: Materials officially disclosed by individual insurers) Future focusing business areas

Notes: 1.The figures after FY07 includes those of Japan Post Insurance.
2. New policy amount is calculated without adjusting for the impact of conversion.

Operating Performance of Living Benefit
Protection and Nursing Care Insurance

 Maintaining competitive superiority in thearea of death protection insurance Enhancing product lineups in the area ofliving benefit protection insurance

AP from newpolicies for FY09

Composition

Living benefit
protection¥4.5 billion

6.6%

+57%

Nursing care

¥1.8 billion

2.6%

+22%

YoY

 Enhancing product lineups in the area of

medical insurance Enhancing product lineups for the aging

society, etc.

Sony Financial Holdings Inc. All Rights Reserved26

(1) Reinforcing our Consulting and Sales Capabilitiesc) Reinforcing Sales Channels

Aiming at a consistent growth by strengthening sales channels which enables Sony Life to offer anhigher level of life planning consultation and follow-up services, and by raising customer satisfaction

 Recruiting more well-skilled sales persons
 Strengthening Lifeplanner

sales channels

 Advancing life planning sales approach Upgrading follow-up services

 Expanding Sony Life’s share in product lineups at each existing Strengthening Partner

independent agency.

channels Developing sales channels through corporate agencies andbanking agencies
 Collecting knowhow to operate an one-stop insurance shop, awholly-owned subsidiary of Sony Life, and apply it to improve sales
method at independent agencies
Sony Financial Holdings Inc. All Rights Reserved27

(1) Reinforcing our consulting and sales capabilitiesd) Reforming the Sales and Back-Office Systems
Project of Reforming Sales Systems■Offering such high-quality follow-up services as customers select our products■Providing quick follow-up services and streamlining the process from sales activities
to back-office work
【Major tasks】■Establishing a comprehensive system of follow-up services, including life planning consultation
at contract signing, information services on its website and Lifeplanner sales employees’ contact
with customers.
■Promoting paperless application procedures and enhancing maintenance services via Internet
Raising customer
satisfaction

Mutualcooperation

Higher sales
productivity

Higher back-officeefficiency
Lower operating
expenses ratio

Project of Reforming Back-Office Systems■Streamlining contract procedures and improving customer services in cooperation with the above project【Major tasks】■Utilizing outsourcing (ex. Business center to which customers send their contract document)■Set up Helpdesk for contract proceduresSony Financial Holdings Inc. All Rights Reserved28

(2) Executing Profit Control and Risk Management on an
Economic Value Basis【Reduction in the Duration Mismatch Risk Between
Assets and Liabilities】
Continuously invested in ultralong-term bonds to reduce theduration mismatch risk between assets and liabilities.
(shift from investing in bonds and CBs with short terms tomaturity, to ultralong-term bonds)【Breakdown of General Account Assets】
Other
Japanese stocks
CBs
Japanese government and corporate bonds (excl. CBs)

【Other Tasks】■Changes to asset management
policy for interest rate sensitive
whole life insurance and semiparticipating products (Reflected in
MCEV calculation as of Mar. 31, 2010)

100%
18.1%

13.2%

14.8%

1.9%

1.7%
80%

6.2%

8.4%

0.3%

12.8%
60%

■Constructed a productdevelopment system and a productcontrol system in reviewing theimpact on MCEV

84.6%

40%

75.1%
62.9%

■Continuously improving operating
expense ratio and other operating
efficiency ratios

20%

0%08.3.31

09.3.3110.3.31

Assetsduration
8.7 years

13.6 years

17.6 years

Sony Financial Holdings Inc. All Rights Reserved29

Growth of AEGON Sony Life Insurance /Overseas Business Expansion
Expansion of Overseas Business

Growth of AEGON Sony Life Insurance(Mainland China)

 Commenced business operations on December 1, 2009

 Characteristic of risk control of minimum guarantee forContinued marketing research aiming at expanding business
operations in Taiwan and Mainland China

annuities(1) Review product profitability quarterly and revise its
pricing if necessary, based on a product design of which
various kinds of ratios are easy to change in a pricing
model(2) Utilize the joint venture reinsurance company with the
AEGON Group

Japan
Japan
Beijing Representative Office(Established in October 2008)●

MainlandMainland China
China
●
50%

50%
s

Sony Financial Holdings Inc. All Rights Reserved

TaiwanTaiwanTaiwan Representative Office(Established in July 2009)30

Mid-term Targets(1) Operating Performance Index
Policy Amount in Force(Individual Life Insurance + Individual Annuities)

Number of Lifeplanner Sales Employees(Person)Continuously recruiting wellskilled sales persons(Trillions of yen)

Increasing 4% per year

40

31.5

32.5

37.1

4,300

33.4

30

4000

3,779

3,891

4,036

09.3.3110.3.31

20

10

0

0

08.3.31

09.3.3110.3.3113.3.3108.3.3113.3.31

Line item amounts are truncated below ¥100 billion and non-consolidated based.

Sony Financial Holdings Inc. All Rights Reserved31Mid-term Targets(2) Sony Life’s MCEV

MCEV(Billions of yen)

Securing a level of annual averageadjusted ROE at approx. 7.5% - 8.00%

1,200
1,000

894.0

800
600

＜Value driver＞
Increasing new
business value andimproving management
efficiency

400.9

400
200
0
09.3.3110.3.31Sony Financial Holdings Inc. All Rights Reserved

13.3.3132

Sony AssuranceSony Financial Holdings Inc. All Rights Reserved

33

FY2009 Review(1) Profitability(Billions of yen)

Ordinary profit

Ordinary revenues

FY08(Billions of yen)

+10.2%

61.8

FY08

Change68.1
Ordinary revenues+17.8%

2.1

FY09

2.5
FY09

Sony AssuranceOrdinary revenues and ordinary profit increased,
year on year.
Ordinary revenues amounted to ¥68.1 billion, up
10.2% year on year. Net premiums written increased,
owing to an increase in the number of policies inforce for mainstay automobile insurance.
Ordinary profit amounted to ¥2.5 billion, up 17.8%
year on year, due mainly to the increase in ordinary
revenues and a decline in the net expense ratio.

61.8

68.1

+6.2

+10.2%

Underwriting income

61.1

67.4

+6.3

+10.4%

Investment income

0.7

0.6

(0.0)

(5.0%)

Ordinary expenses

59.7

65.6

+5.9

+9.9%

Underwriting expenses

44.2

49.1

+4.9

+11.3%

Investment expenses

0.1

0.0

(0.1)

(92.6%)

Operating, general andadministrative expenses

15.3

16.3

+1.0

+7.1%

Ordinary profit

2.1

2.5

+0.3

+17.8%Net income (loss)

(1.5)

1.6

+3.1

－

(Billions of yen)

09.3.3110.3.31

Underwriting reserves

50.7

58.1

+7.3

+14.4%

Total net assets

13.6

15.4

+1.8

+13.2%

(0.1)

0.0

+0.1

－

86.6

98.3

+11.6

+13.4%Net unrealized gains/losses onother securities (net of taxes)

Total assets

Change from 09.3.31

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

34

FY2009 Review(2) Operating Performance

Net Premiums Written andNumber of Policies in Force(Billions of yen)

Others
Personal accident insurance
Voluntary automobile insurance
Number of policies in force

90

1.15

80
70
60
50

(Millions of policies)

50.4

1.27

Earned/incurred loss ratio
Net expense ratio+1.7pt

1.4

89.9

89.0

90.2

91.9

1.3
1.2

67.4
61.1

55.0

(%)

100

+10.6%

1.02
0.93

Net Expense Ratio + Earned/Incurred Loss Ratio

80

1.1+2.3pt1.0+10.4%

0.9

60
63.6

0.8
0.7

40

0.6

62.3

65.8

63.5

40

0.5

30

0.4
20

20

0.3

26.3

26.7

26.7 (0.6pt) 26.1

FY06

FY07

FY08

0.2

10

0.1
0.0

0
FY06

FY07

FY08

FY09

0
FY09

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

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.

losses to earned premiums.
*Note that earthquake insurance and compulsory automobile liability
insurance are excluded from the above calculation.

Sony Financial Holdings Inc. All Rights Reserved

35Market Overview(1) Automobile Insurance Market
Auto Insurance Market & Share of Direct Insurers

Direct Premiums Written by Direct Insurer(Billions of yen)(Billions of yen)
4,000

4.7%

5.0%

70.0

4.3%
3.9%

3,000

3.6%

A社
B社

4.5%

3,500

Sony

C社

60.0
4.0%
3.5%

D社
E社

50.0

3.3%
2,500

3.0%

40.0

2.8%
2,000

2.5%
2.3%
2.0%

1,500

30.0

1.7%
1.5%

20.0

1,000
1.1%
0.7%

500

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

1.0%

10.0
0.5%

0.3%
0

0.0%

0.0%

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

Source: Statistics of Non-life Insurance Business in Japan

0.0
FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09

Source: Statistics of Non-life Insurance Business in Japan andthe data disclosed by each company

Sony Financial Holdings Inc. All Rights Reserved

36Market Overview(2) Profitability (Automobile insurance)

Net Expense Ratio + Net Loss Ratio

Net Expense Ratio

40%

Major B
Major C
Major D
Major A
Major E

35%

30%

110%

Major C
Major B
Major A
Major E

105%
Sony
25%

FY04

FY05

FY06

FY07

FY08

Major D

100%

20%
FY09

Net Loss Ratio

80%

95%

75%

Sony

Major C
Major E
Major B
Major ASony
Major D

70%

65%

The figure for Sony is Earned/Incurred loss ratio*

90%
FY04

FY05

FY06

FY07

FY08

FY09

60%

The figure for Sony is Earned/Incurred loss ratio*※Sony Assurance uses Earned/Incurred loss ratio for accurate comparison purpose.
Source: Prepared by Sony Assurance, using the data disclosed by each company

55%
FY04

FY05

FY06

FY07

FY08

FY09

Sony Financial Holdings Inc. All Rights Reserved37Mid-term Strategic Focuses

Mid-term Targets

Promote marketing activities and enhance service levels aiming at
achieving a new target direct premiums written of ¥100.0 billion
Secure profitability for a target adjusted ROE of 10% by growing
business operations and properly controlling the loss ratio and theexpense ratio
Promote the online business model by strengthening the website
system including the system for mobile phone website

Sony Financial Holdings Inc. All Rights Reserved

38

Mid-term Strategic Focuses
Growth of Automobile Insurance

Risk-segmentation

Marketing Channel

Direct marketing

High quality
Low
serviceexpense ratio

Channel Sales

Shift to Internet
in Contract Channels
ervicessdeddaeighly valu
h
d
e
r
e
f
f
Human-oExpense ratio
Services provided through Internet

Fiscal years
Sony Financial Holdings Inc. All Rights Reserved

39

Major Initiatives(1) Sales Strategy (Automobile Insurance) : Marketing
Strategic investment in marketing
Advertising Expenditures in Japanby Type of Media

Investment in Direct Channels Advertisement160

Direct Marketing Advertisement Expenses(Setting the level of FY08 as 100)

2,500

（ Billions of yen）
8,000

（ Billions of yen）

7,000

140

TV
2,000
6,000

120
100
80
60
40
20

5,000

1,500
New s paper

Direct Marketing Advertisement Expense Ratio(Setting the level of FY08 as 100)
Direct Marketing
Advertisement
Direct Marketing
Expenses
Advertisement Expense Ratio ＝×100
Net premiums
written

0

4,000

1,000

3,000
Internet (including
mobile)

2,000

Magazines

500

1,000

Radio
Mobile
0

FY08

FY09

FY10

FY11

FY12

0
99

'00

'01

'00

'01

'02

'03

'04

'05

'06

'07

'08

'09

Source: ”Advertising Expenditures in Japan” by Dentsu

Sony Financial Holdings Inc. All Rights Reserved

40

Major Initiatives(2) Service Strategy (Automobile insurance)
High Evaluations From Outside Institutions
Ranking in Customer Satisfaction

Ranking in Customer Satisfaction

with contract, products and services: No. 1

with Accident Response: No.2

<For Direct insurers>

701

Sony AssuranceSony Assurance

640

690

624

676

623

671

614

665

600
580

600

664

620

640

660

661

<For Agent type insurers>

658

Foreign A

655

613

Major A

601

648

Foreign B

600

644

599

643

599

629

596

617

593
580

600

620

640

660

560

580

600

620

640

660

680

700

720

Source: J.D. Power Asia PacificSony Financial Holdings Inc. All Rights Reserved

41

Major Initiatives(3) Strategy to Enhance Profitability<Total of all types of insurance>

Net Expense Ratio + E.I. Loss Ratio
100%

89.0

90.2

91.9

94.2

Average Running Distance at the Time of
Maturity+ E.I. Loss Ratio (Yearlong period)
(％)

（km）
7,000

90%
60%

80%

6,500

70%
55%

60%

62 .3

63 .5

6,000

6 5.8

Average running distance at the time of
maturity
E.I. Loss Ratio (yearlong period)

50%

50%

5,500
07
.4
07
.6
07
.
07 8
.1
0
07
.1
2
08
.2
08
.4
08
.6
08
.
08 8
.1
08 0
.1
2
09
.2
09
.4
09
.6
09
.
09 8
.1
09 0
.1
2
10
.2

40%
30%

(yen)
90,00020%
10%Comparison of Average Premium

80,000

26 .7

26 .7

2 6.1

70,00060,0000%50,000

FY07

FY08

FY0 9

FY1 2

40,00030,000E.I. loss ratio＝

Net losses paid + Loss adjustment expenses +accumulation in provision for reserve for outstanding losses

20,00010,000Earned premiums
0

Excluding earthquake insurance and compulsory automobile liability insurance

Major A

Major B

Major CSony

Direct A

Direct B

Direct C

Source: Statistics of Non-life Insurance Business in Japan

Sony Financial Holdings Inc. All Rights Reserved

42Mid-term targets(1) Operating Performance Index

Direct Premiums Written

Ordinary Profit(Billions of yen)(Billions of yen)

3.5

90.0
80.0

3.0

2.8

67.1

70.0

2.5
2.5

60.9
60.0

3.2

83.0

2.1

54.6

2.0

50.0
40.0

1.5

30.0

1.0

20.0

0.5

10.0

0.0

0.0
FY07

FY08

FY09

FY12

FY07

FY08

Sony Financial Holdings Inc. All Rights Reserved

FY09

FY12

43

Mid-term Targets(2) Profitability Index and Soundness Index

Solvency Margin Ratio

Net Profit and Adjusted ROE(current domestic criteria)
4.0

17.2%

20%

11.6%

1,200%

15%

1073.9%10%

Adjusted ROE
target：10％

3.0
2.1

-1.6%
(1.6%)

2.0

5%
0%

2.0

993.0%

1,000%

1018.5%1040.0%1 0.3 .3 1

13 .3.31(0.5%)-5%(1.0%)
-10%

800%

1.6

1.0

600%

0.0
FY07

FY08

FY09

FY12

(1.0)

400%

200%

(1.5)
(2.0)

0%
08 .3.31

Adjusted ROE = Adjusted profit / Adjusted capital
Adjusted profit = The net income plus provision for special catastrophe reserve and its provision forreserve for price fluctuations, in each case after taxes.
Adjusted capital = The average amount of net assets plus the sum of special catastrophe reserveand its reserve for price fluctuations, in each case after taxes.

0 9.3 .3 1

Line item amounts are truncated below ¥100 million;
percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

44Sony Bank (Non-consolidated)

Sony Financial Holdings Inc. All Rights Reserved

45

FY2009 Review(1) Operating Performance
Customer Assets (Deposits + Investment Trusts)
and Number of Accounts
Yen deposits
Foreign currency deposits
Investment trusts
Number of accounts (thousands)

796(Billions of yen)Mortgage loans

Other

600

100.0

586.6

+109.5

1,610.0

610

1,600

1,400

*including syndicated loans of ¥23.3billion.

723(Billions of yen)

Loans

477.0

500

31.5(*)

1,403.6

491+206.4

1,247.3

400

1,200

347.0

1,000

300

848.8
800

284.7

Deposits total:¥1,510.0 billion
200

600

400

100
200

0

0
07.3.3108.3.31

09.3.3107.3.3108.3.31
09.3.3110.3.3110.3.31
Line item amounts are truncated below ¥100 million; number of accounts are truncated below 1,000 accounts.

Sony Financial Holdings Inc. All Rights Reserved

46

FY2009 Review(2) Profitability(Billions of yen)(Billions of yen)

Ordinary revenues

33.3

Ordinary profit(8.6%)

30.5+606.5%

0.4
FY08

2.9

FY08

33.3

30.5

(2.8)

(8.6%)

Gross operating profit

10.8

14.9

+4.0

+37.6%Net interest income

6.6

13.0

+6.3

+96.1%Net fees and commissions

0.3

(0.1)

(0.5)

－

Net other operating income

3.9

2.1

(1.7)

(45.6%)

General andadministrative expenses

10.3

11.6

+1.3

+13.3%

Ordinary profit

0.4

2.9

+2.5

+606.5%

(0.7)

1.6

+2.3

－

0.5

3.2

+2.6

+506.1%

Net operating profit

Sony Bank
Despite a decrease in ordinary revenues, ordinary profit increased
year on year.
Gross operating profit increased ¥4.0 billion year on year due to anincrease in net interest income.
- Net interest income increased ¥6.3 billion due mainly to a decline
in interest on deposits in the lowering of interest rates and higher
interest on loans.
- Net other operating income decreased ¥1.7 billion, mainly
because foreign exchange gains on investment in foreign
currency deposits decreased owing to the lowering interest rates,and gains from derivatives, net, which were held for hedging
purposes, turned into losses.
Net income amounted to ¥1.6 billion, from a net loss of ¥0.7 billion
in the previous fiscal year.
Customer assets increased ¥206.4 billion from March 31, 2009.

ChangeOrdinary revenues

Net income

FY09

FY09

09.3.3110.3.31

Change from 09.3.31

Securities

823.1

880.1

+56.9

+6.9%

Loans

477.0

586.6

+109.5+23.0%

Deposits

1,326.3

1,510.0+183.6+13.8%

Customer assets

1,403.6

1,610.0+206.4+14.7%

Total net assets

46.2

58.9

+12.7

+27.5%

(9.6)

0.9

+10.5

－

1,411.9

1,612.1+200.2+14.2%Net unrealized gains/losses
on other securities(net of taxes)

Total assets

Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

Sony Financial Holdings Inc. All Rights Reserved

47

FY2009 Review(3) Profitability (Based on Internal Control Basis)■<Reference> On an Internal Control Basis
FY08

FY09

Change

10.8

14.9

+4.0

+37.6%Net interest income *1 ①

12.1

13.7

+1.5

+12.7%Net fees andcommissions *2 ②

1.8

0.9

(0.9)

(48.9%)Net other operating
income *3

(3.1)

0.2

+3.4

－

Gross operating profit

Gross operating profit(core profit) (A)= ①＋②
Operating expenses andother expenses ③
Net operating profit(core profit)<Reference>
Net Operating Profit (Core Profit),
Operating Expenses and Other Expenses& Gross Operating Profit (Core Profit)(Billions of yen)(Billions of yen)

Net operating profit (core profit)
Gross operating profit (core profit)

15

Operating expenses and other expenses

14.6

14.0
11.7

14.0

14.6

+0.6

+4.4%

10.3
10

10.3

11.7

+1.4

+13.8%

3.7

2.9

(0.8)

(21.7%)= (A)－③●On an Internal Control Basis
The following adjustments are made to the figures on a financial accounting basis toaccount for profits and losses more appropriately.
*1: Net interest income: Includes profits and losses associated with fund investment
recorded in net other operating income, including gains or losses from currency
swap transactions.
*2: Net fees and commissions: Includes profits and losses for customer dealings in foreign
currency transactions recorded in net other operating income.
*3: Net other operating income: After the above adjustment (*1 and *2), consists of profits
and losses for bond and derivative dealing transactions.

5

3.7(21.7%)

2.9

0
FY08

●Core profit
Profits and losses exclude net other operating income, including those for bond andderivative dealing transactions, and stands for Sony Bank’s basic profits.

Sony Financial Holdings Inc. All Rights Reserved

FY09

Line item amounts are truncated below ¥100 million;
percentage change figures are rounded.

48

Management Policy
Establish a firm presence as an asset management bank
Forge stronger win-win relationships with customers by raising operational efficiencies

１

Continuously grow business operations (retail balance)
 Sony Bank has gained a certain level of customer satisfaction with its products andservices. However, its presence in the financial market for individual customers is still
small and its growth potential remains enormous.
 Continuously Expand retail balance through the promotion with new sales methods andchannels for the customers who Sony Bank has not reached２

Raise profitability
 Raise efficiency and profitability of ALM to respond to expanding asset scale, to promoterisk dispersion and operational efficiency, and to maximize risk return.
 Upgrade business operations, especially service quality and productivity, for further

pursuing a low cost business model and seek for higher customer satisfaction andimprovement of cost efficiency.

３

Maintain financial soundness Keep Sony Bank’s capital adequacy ratio at a level of around 10%

Sony Financial Holdings Inc. All Rights Reserved49

Growth Strategy
Sony Bank’s business growth
Forge stronger win-win relationships with stakeholders,
including customers, based on profit growth
Employee
growthSalary & Growth
opportunities

Offering products andservices in the Sony's sales
methodContribution

Profit growth
Expandingrevenues

Improvingcost
efficiency

Higher customer satisfaction
More
convenient
More pricecompetitive

Sympathy,
attachment
and trust

Investment
Dividends & ROE

Increasing
shareholder value

Expanding retail balanceSony Financial Holdings Inc. All Rights Reserved50Consistent Growth of Business Operations
High Customer Satisfaction

Consistent growth of Business Operations

Nikkei financial institution ranking Consumer satisfaction
FY06 (No.3)
1

FY07 (No.4)

FY08 (No.5)

FY09 (No.6)

Bank GBank FBank ABank G

2
3

Bank HBank FBank GBank B

4

Bank K

Bank HBank HBank F

5

Bank FBank JBank IBank G

Retail loans
Investment trusts
Foreign currency deposits
Yen deposits

Retail BalanceApprox. ¥3
trillion

2,173.4
1,880.7
1,594.4

563.3
477.1
77.3
282.1

100.0
325.1

892.7

1,044.3

1,185.0

08.3.31

09.3.3110.3.31

347.1
103.0
251.7

Source: Prepared by Sony Bank based on the 6th Nikkei financial institution ranking Consumer satisfaction (Nihon Keizai Shimbun)

Growth Potential in the Financial Market for
Individual Customers

13.3.31(Trillions of yen)

Approx. 1
millionCommercial
JP Bank
176.4

Consumer
deposit
total

banks
141.0
26%

32%

approx.
¥546 trillions（Sep.2009）

Interenet
bank

Sony
1.3
Others Internet Bank
41%
total
1.9 ¥3.3 trillions
59%

Number of account
0.72

0.79

0.61

3.3
Second-tier

Regional

Trust banks

regional

bank

33.5

bank

148.1

6%

43.7

27%

0.6%

8%

Source: Prepared by Sony Bank based on the Nikkin Report and Materials officially disclosed by individual banks.
Note: The above figures exclude those of Shinkin banks, credit union banks, labor credit association, and agricultural cooperatives, etc.

08.3.31

09.3.31Sony Financial Holdings Inc. All Rights Reserved

10.3.3113.3.3151

Accelerating Growth of Mortgage Loans
Mortgage Loan Market ShareAccelerating Growth of Mortgage Loans

Total of domestic banks

Increased am ount of m ortage loans

Balance of Mortgage Loans

Sony Bank’s share

Approx. ¥1
trillion(Trillions of yen)
1.13%
17
0.67%

17

0.66%
0.52%

16
0.31%

GeneralTie-up channels
Banking agency

0.89%

16

0.31%

15

15

14
（Billions of yen）

FY03

FY04

FY05

FY06

FY07

FY08

FY09

555.1

468.3

Total of domestic banks

Balance of m ortgage loans

Sony Bank’s share(Trillions of yen)

0.54%

338.8

0.43%
0.34%

92
0.21%

87
84

0.28%
92

98

95

100

0.11%
0.07%

FY03

FY04

08.3.31
FY05

FY06

FY07

FY08

09.3.31

FY09

Note1: Source: Statistics of Bank of Japan (Mortgage loans and other loans)
Note2: Fiscal year ended on Dec. 31 for each year
Note3: This figure is the total for banking accounts, trust accounts and overseas branch accounts (domestic portion) ofJapanese banks. However, the figure excludes the Resolution and Collection Corporation, Kii Deposit
Management Bank (dissolved on March 31, 2002), the Bridge Bank of Japan (dissolved on March 8, 2004), theSecond Bridge Bank of Japan and the Japan Post Bank.
Note4: The maximum market scale of mortgage loans, including the figures of Shinkin banks, credit union banks, JA
Group and Japan housing finance agency, etc. was approx. 170 trillion yen at the end of 2009.

10.3.3113.3.31

Banking Agencies
z Sony Lifez Seven Bankz F&M

Sony Financial Holdings Inc. All Rights Reserved

z LIPLA (subsidiary ofSony Life)※LIPLA started business
operations in May 2010.

52

Responding to Diverse Customer Needs
Sony Bank“Housing Loan Plaza”

is to open in front of Tokyo Station Yaesu Central Entrance on June 24, 2010.

* Please see the press release for details.
Sony Financial Holdings Inc. All Rights Reserved53Supporting Asset Management of
Financial Portfolio for Individual Customers
offers one-stop individual asset management services

CFD

FX

ReturnYen time
deposits

Foreigncurrency
deposits Investment
trustsJapanese
StocksStockmargintrading

ETF
REIT

Ordinary
yen deposits

Risk* The above chart is an image to show risk-return
relationships in Sony Bank’s portfolio.

Sony Financial Holdings Inc. All Rights Reserved

54Mid-term Targets(1) Higher Profitability
Gross Operating Profit(Internal control basis)

Asset Scale and Loan-Deposit Ratio
Loan-deposit ratio(yen deposit base)39%

Loan-deposit ratio

Approx. 80%

46%

50%

36%

39%

Approx. 60%

0.91%
0.91%
0.84%

Net other operating income

Interest spread

Approx. ¥20
billion30%

Total Assets（Billions of yen）

Net fees and commissions
Net interest income
Gross operating profit(Billions of yen)

10.9
1.6

0.2 14.9
0.9

1.8

1,211.0

1,411.9

1,612.1

08.3.31

09.3.3110.3.3113.3.31

Profitability

10.8

12.1

Approx. ¥2
trillion

4.4%

13.7

0.6%

9.2

FY07

(3.1)

Approx.
７%

3.8%

FY08

ROE

FY09

FY12

※ ROE after adjusting tax effect (tax percentage: 40%)

FY07

FY08

FY09

FY12

Sony Financial Holdings Inc. All Rights Reserved

55Mid-term Targets(2) Maintaining Financial Soundness
Ratio of Nonperforming Loans

Capital Adequacy Ratio

Risk-monitored loan (As of September 30, 2009)11.08%
9.11%

12.09%

Approx. 10%

14.0%
12.0%
10.0%

Capital adequacy ratio

8.0%

Sony

0.20%

(Billions of yen)
100.0

90.0

2.63%

Bank average

Tier2
Tier1

80.0

Commercial
banks

2.06%

70.0
49.8

60.0

Trust banks

1.86%

50.0

62.4

37.2

40.0

Regional bank

3.28%
30.0

Second-tierregional bank

4.28%

20.0
10.0
0.0

Note: Prepared by Sony Bank based on the Financial Business Winter 2010 (ToyoKeizai Shinpo)

08.3.31

09.3.3110.3.3113.3.31※Capital adequacy ratio of 11.08% as of March 31, 2009 was calculated without applying
the special exception of the standard stipulated by Article 14-2 of the Banking Law ofJapan, in accordance with the FSA public ministerial announcement No. 79 of 2008.

Sony Financial Holdings Inc. All Rights Reserved56Sony Financial Holdings

Sony Financial Holdings Inc. All Rights Reserved57

Consolidated Financial Forecast
for the Year Ending March 31, 2011
Consolidated Ordinary Revenues
FY09

FY10

Change(Forecast)

FY10 forecast
vs FY09 actual(Billions of yen)
1,200
1,000

Consolidated ordinary revenues

978.9

974.0

(0.5％)

Life insurance business

882.0

871.3

(1.2％)

Non-life insurance business

68.1

72.7

+ 6.6 ％

Banking business

30.5

30.6

+ 0.3％

Banking business
Non-life insurance businessLife insurance business

978.9

974.0

800

(Forecast)

600
400
200
0
FY09

FY10

Consolidated Ordinary Profit
Consolidated ordinary profit(Billions of yen)

84.3

74.0

(12.3％)

Life insurance business

79.7

69.6

(12.8％)

90

Non-life insurance business

2.5

2.2

(14.2％)

80

Banking business

1.9

2.8

+ 45.2%70

100

Banking business
Non-life insurance businessLife insurance business

84.3
74.0

60
50

(Forecast)

40

Consolidated net income

48.1

40.0

(16.9％)

30
20
10
0

(Billions of yen; amounts are truncated below ¥100 million; percentage changes are rounded.)Sony Financial Holdings Inc. All Rights Reserved

FY09

FY10

58

Capital and Dividend Policies■Basic Idea of Capital and Dividend Policies
Maintain balance between the following policies (A) & (B)(A) Keeping financial soundness as a financial institution(B) Paying stable dividends and securing an adequate level of internal reservefor future business development

Financial Soundness
Indicator(As of Mar31, 2010)

Solvency
Margin Ratio

2,637.3%

Solvency
Margin Ratio

1,018.5%

Capital Adequacy Ratio(Domestic Criteria)

12.09%

 Introducing International accounting standards

Estimated changes inbusiness
environment Marked-to-market valuation of insurance liabilities
 Comprehensive income statements
 (Insurance) Introducing Solvency II and other indices based on economic value (Bank) Attracting more attention on the core capital adequacy ratio

Dividend policies

Ensuring stable ongoing dividends to shareholders for a long term period,
considering the Group’s operating performance and estimated changes in theregulations in each industry
FY08 (results): ¥3,000 per share

FY09 (planned): ¥3,000 per share

Sony Financial Holdings Inc. All Rights Reserved

59Mid-term Management Targets (FY2012)
Key Management Benchmarks
 Consolidated ordinary revenues, consolidated ordinary profit and consolidated net income
 Consolidated adjusted ROE
SonySony Assurance:
Assurance:
Net
IncomeNet Income andand Adjusted
Adjusted ROE
ROE

Sony
Sony Bank:
Bank:
Net
IncomeNet Income andand ROE
ROE

Maintaining Adjusted ROE of 10%+Targeting ROE of 7%+

Sony Life:
Life:
Sony
MCEV
and
Adjusted
ROE
MCEV and Adjusted ROE

Steadily growing with target adjusted ROE of 7.5%-8.0%
ＭＣＥＶ
1,200

(Billions of yen)80%

Adjusted ROE（%）

3.0
1,000
40%

2.0

800

600

1.0

0%

0.0

400
-40%

-1.0

200

0

Net income

Net income

Adjusted ROE（%）(Billions of yen)

-80%

-2.0

FY08 FY09 FY10 FY11 FY12
Source: Sony Life
Notes: Calculation of Adjusted ROE
Numerator: Net increase in MCEV plus dividend
Denominator: The average of (MCEV at previous fiscal year-end — dividend+ MCEV at current fiscal year-end）(Billions of yen)

20%

8.0

10%

7.0

0%

6.0

-10%

5.0

-20%

4.0

-30%

3.0

-40%

2.0

-50%

1.0

-60%

0.0

-70%

-1.0

-80%

-2.0

Adjusted ROE（%）

20%

10%

0%

-10%

-20%

-30%

-40%

FY08 FY09 FY10 FY11 FY12

FY08 FY09 FY10 FY11 FY12

Source: Sony Assurance
Notes: Calculation of Adjusted ROE
Numerator: Net income plus an increase in provision for special
catastrophe reserves (after-tax) and an increase in reserve for pricefluctuations (after-tax)
Denominator: The average of (net assets + special catastrophe reserve(after-tax) and reserve for price fluctuations (after-tax)) as of the previous
fiscal year-end and the current fiscal year-end

Source: Sony Bank
Notes：Calculation of ROE:
Numerator: Net income
Denominator: The average of net assets as of the previous fiscal yearend and the current fiscal year-end
ROE after adjusting tax effect (tax percentage: 40%)

Sony Financial Holdings Inc. All Rights Reserved

60

SFH Group’s Management Policies

１．Achieve sustainable growth based on the effective
business model
２．Manage asset portfolio to earn stable profits
３．Maintain an adequate level of capital to secure
financial soundness
４．Invest to maintain the mid- to long-term growth
５．Enhance SFH Group’s value by total growth strategies

Sony Financial Holdings Inc. All Rights Reserved

61

APPENDIX

Sony Financial Holdings Inc. All Rights Reserved

62

Key Management Benchmarks¾ Consolidated ordinary revenues, consolidated ordinary profit andconsolidated net income¾ Consolidated adjusted ROE
Perspective on Consolidated Adjusted ROESony Financial Holdings GroupSony Life

Sony AssuranceSony Bank

Net income
Numerator

Denominator

Net increase in MCEV
plus dividends

The average of (MCEV atprevious fiscal year-end
minus dividend plus MCEV
at current fiscal year-end)+++ Increase in provision for special
catastrophe reserves (after tax)
+ Increase in reserve for pricefluctuations (after tax)

The average of (net assets +special catastrophe reserveand reserve (after-tax) 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

Note: Calculations take dividends and other specific factors into consideration.

Sony Financial Holdings Inc. All Rights Reserved

63

Contact:
SFH

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

Sony Financial Holdings Inc. All Rights Reserved64