Presentation Material

Consolidated Financial Results
for the Three Months Ended June 30, 2012
andSony Life’s
Market Consistent Embedded Valueas of June 30, 2012
Sony Financial Holdings Inc.
August 13, 2012

Content■Consolidated Operating Results for the Three Months Ended June 30, 2012

P.3

■Consolidated Financial Forecast for the Year Ending March 31, 2013

P.26

■Sony Life’s MCEV and Risk Amount Based on Economic Valueas of June 30, 2012

P.28

■ Appendix

P.30

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-looking statements. Forward-looking statements may include—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
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.

2Consolidated Operating Results for
the Three Months Ended June 30, 20123

Highlights of Consolidated Operating Performancefor the Three Months Ended June 30, 2012 (1)(Billions of yen)

Ordinary revenues

Ordinary profit

+8.0%

277.2

256.8

247.6

+18.3

+8.0%

Ordinary profit

17.6

13.7

(3.8)

(21.9%)

Non-life
insurancebusiness

Ordinary revenues

20.4

21.7

+1.2

+6.3%

Ordinary profit

0.7

0.7

(0.0)

(8.0%)

Ordinary revenues

7.4

8.3

+0.9

+12.4%

Ordinary profit

0.8

0.8

(0.0)

(0.6%)

(0.4)

(0.5)

(0.0)

－

0.0

0.0

0.0

+23.1%

256.8

277.2

+20.4

+8.0%

Ordinary profit

19.3

15.4

(3.9)

(20.3%)Net income

10.8

9.6

(1.2)

(11.7%)

12.3.3112.6.30

Total assets

7,241.4

7,365.0+123.6+1.7%

Net assets

347.8

356.8

+9.0

+2.6%

Ordinary revenues
Ordinary profit
Ordinary revenues

Consolidated

19.3

FY11.1Q

229.3

ChangeOrdinary revenues

Intersegment
adjustments*

15.4

FY12.1Q

Life
insurancebusiness

Bankingbusiness(20.3%)

FY11.1Q(Billions of yen)

FY12.1Q

Change from
12.3.31(Billions of yen)

Consolidated*Amounts in the Ordinary profit in the “Intersegment adjustments” are mainly from SFH.
*Comprehensive income: FY11.1Q: ¥23.4 billion, FY12.1Q: ¥17.7 billion.
Line item amounts are truncated below ¥100 million; percentage change figures are rounded.

4

Highlights of Consolidated Operating Performancefor the Three Months Ended June 30, 2012 (2) Life Insurance Business: Ordinary revenues increased year on year due to higher income frominsurance premiums associated with a steady increase in the policy amount in force. Ordinary profit
decreased year on year, reflecting an increase in provision for policy reserves related to minimum
guarantees for variable life insurance policies. The decrease was also due to recording profit for theprevious period resulting from lower insurance claims and other payments related to the Great East
Japan Earthquake than estimated in the reserve for outstanding claims as of March 31, 2011.
 Non-life Insurance Business：Ordinary revenues increased year on year, owing to an increase in net

premiums written primarily for automobile insurance. Ordinary profit slightly decreased year on year
owing to an increase in the loss ratio caused by higher net losses paid for automobile insurance.
 Banking Business：Ordinary revenues increased year on year due to an increase in net fees andcommissions resulting from Sony Bank’s acquisition of SmartLink Network, Inc. in July 2011 as its
consolidated subsidiary. Ordinary profit remained at the same levels as during the same period of theprevious fiscal year, because higher interest received on loans due to an increase in the balance ofmortgage loans offset a decrease in profit related to foreign currency transactions.
 Consolidated ordinary revenues increased 8.0% year on year, to ¥277.2 billion, however, consolidated

ordinary profit decreased 20.3%, to ¥15.4 billion. Net income decreased 11.7%, to ¥9.6 billion.

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

5

Highlights of Operating Performance:
Sony Life (Non-consolidated)
Ordinary revenues

229.3

FY11.1Q

FY12.1Q

229.3

247.6

+18.3

+8.0%

Income from insurance premiums

194.6

217.9

+23.3

+12.0%

Investment income

29.0

27.8

(1.1)

(4.0%)

Interest income and dividends

23.2

25.7

+2.5

+10.8%

Income from monetary trusts, net

1.3

1.3

(0.0)

(0.7%)

Gains on sale of securities

0.5

0.7

+0.2

+52.7%

Gains on separate accounts, net

3.9

－

(3.9)

(100.0%)

211.3

233.4

+22.0

+10.4%

Insurance claims and other payments

71.3

69.9

(1.4)

(2.1%)

Provision for policy reserves and others

108.1

107.2

(0.9)

(0.8%)

3.0

26.1

+23.0

+745.2%Losses on sale of securities

0.4

0.0

(0.3)

(77.5%)

Losses on separate accounts, net

－

23.6

+23.6

－

25.1

26.1

+1.0

+4.3%

Ordinary profit

17.9

14.1

(3.7)

(20.8%)Net income

10.1

8.2

(1.9)

(19.4%)

12.3.3112.6.30

Securities

4,545.0

4,657.1+112.1+2.5%

Policy reserves

4,843.0

4,950.2+107.2+2.2%

Total net assets

264.8

272.2

+7.3

+2.8%

34.0

42.3

+8.2

+24.3%

5,222.8

5,330.7+107.9

+2.1%

444.2

427.5

(16.7)(3.8%)(Billions of yen)

Ordinary profit

+8.0%

247.6

Ordinary revenues

Ordinary expenses(20.8%)

14.1

17.9

Investment expenses

FY11.1Q

FY12.1Q(Billions of yen)Ordinary revenues increased but ordinary profit decreased year onyear.
Income from insurance premiums increased due to a steadyincrease in the policy amount in force.
Investment income decreased due to worse investment
performance on separate account assets under the deteriorated
financial market conditions. This offset the positive impact of higher
investment income in the general account assets, driven mainly byan increase in interest income and dividends.
Ordinary profit decreased year on year, reflecting an increase inprovision for policy reserves related to minimum guarantees forvariable life insurance policies. The decrease was also due torecording profit for the previous period resulting from lower
insurance claims and other payments related to the Great East
Japan Earthquake than estimated in the reserve for outstanding
claims as of March 31, 2011.

Operating expenses(Billions of yen)

Net unrealized gains on other securities
Total assets
Separate account assets

ChangeChange from 12.3.31

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

6

Overview of Performance:
Sony Life (Non-consolidated)(Billions of yen)
New policy amount

FY11.1Q

FY12.1Q

Change1,054.4

1,066.5+1.1%

Lapse and surrender amount

530.3

497.5

(6.2%)

Lapse and surrender rate

1.53%

1.38%

(0.15pt)

Policy amount in force

35,073.4

36,432.0+3.9%Annualized premiums from new policies

17.1

17.4

+1.6%

Of which, third-sector products

4.2

4.4

+4.5%

611.5

643.0

+5.2%

143.1

151.5

+5.9%

Annualized premiums from insurance in force
Of which, third-sector products(Billions of yen)

FY11.1Q

FY12.1Q

ChangeGains from investment, net (General account)

21.9

25.3

+15.3%

Core profit

19.2

14.7

(23.0%)

Negative spread

1.3

0.5

(61.5%)

Solvency margin ratio

12.3.3112.6.30

1,980.4%

2,081.8%

Changefrom 12.3.31+101.4pt

Notes:*1 Figures for new policy amount, lapse and surrender amount, lapse and surrender rate, policy amount in force,
annualized premiums from new policies and annualized premiums from insurance in force are calculated as thetotal of individual life insurance and individual annuities.
*2 The lapse and surrender rate shows the ratio derived by dividing the amount of lapses and surrenders, notadjusted for policy amount decreases, increases, and reinstatements, by the policy amount in force at the
beginning of the fiscal year.
*3 The above-stated figures of solvency margin ratio are calculated according to the new standards which became
effective as of the end of fiscal 2011 (March 31, 2012).

(Reasons for changes)
 Increased due mainly to higher sales of living
benefit insurance.

 Decreased due to the lowering lapse andsurrender rates mainly in term-life insurance.

 Increased due mainly to higher sales of living
benefit insurance.

 Increased due to an increase in interest income
and dividends.

 Decreased reflecting an increase in provision forpolicy reserves related to minimum guarantees forvariable life insurance policies. The decrease wasalso due to recording profit for the previous period
resulting from lower-than-estimated insurance
claims and other payments related to the Great
East Japan Earthquake in the reserve foroutstanding claims as of March 31, 2011. These
decreases in profit offset the positive impact of adecline in negative spread.

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

7

Sony Life Operating Performance (1)Number and Amount of New Policies

Annualized Premiums from New Policies(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)

New policy amount

155(Trillions of yen)

Number of new policies(Thousands of policies)
+1.3%

150

152

Annualized premiums from new policies(Billions of yen)20

15,000
1.5

1.06

1.05

+1.1%

Of which, third-sector

1.06

18.1

17.1

+1.6%

17.4

15

100

10,000
1.0

10

5,000
0.5
+4.5%

5

0

0
FY10.1Q

FY11.1Q

FY12.1Q

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

4.1

4.2

4.4

FY10.1Q

FY11.1Q

FY12.1Q

0Line item amounts are truncated below ¥100 million; percentage figures are rounded.

8

Sony Life Operating Performance (2)Number and Amount of Policies in Force

Annualized Premiums from Insurance in Force(Individual Life Insurance + Individual Annuities)(Individual Life Insurance + Individual Annuities)

Policy amount in force

Number of policies in force

Annualized premiums from insurance in force

Of which, third-sector(Millions of policies)(Trillions of yen)
+6.1%

5.76

5.67

(Billions of yen)

+1.5%

5.42

+5.2%

611.5

643.0

635.4
+1.2%

35.0

+3.9%

36.4

36.0
+1.0%

+5.9%

143.1

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

148.9

+1.7%

151.1

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

9Sony Life Operating Performance (3)Lapse and Surrender Rate*

Solvency Margin Ratio(Individual Life Insurance + Individual Annuities)
(%)
(%)

10

Lapse and surrender rate
（1Q）

Lapse and surrender rate
（Annual）

2,500+101.4pt

2,081.8

1,980.48

2,000

1,720.0
6.41
6

5.93
1,500

4

2

1.58

1.53

1,000
(0.15pt)

1.38

0
500

0
FY10

FY11

FY12.1Q*The lapse and surrender rate shows the ratio derived by dividing the amount oflapses and surrenders, not adjusted for policy amount decreases, increases, andreinstatements, by the policy amount in force at the beginning of the fiscal year.

11.3.3112.3.3112.6.30

Note: The above-stated figures of solvency margin ratio are calculated according
to the new standards which became effective as of the end of fiscal year 2011
(March 31, 2012).

Percentage change figures are rounded.

10

Sony Life Operating Performance (4)Income from Insurance Premiums(Billions of yen)

Ordinary Profit(Billions of yen)

217.9
30

+12.0%

200

194.6
182.6

20

18.8

17.9
14.1

100

(20.8%)

10

00
FY10.1Q

FY11.1Q

FY12.1Q

FY10.1Q

FY11.1Q

FY12.1Q

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

11

Sony Life Operating Performance (5)Negative SpreadCore Profit(Billions of yen)(Billions of yen)

19.2

20

3
(23.0%)

2.6
14.7

15

2

11.7
10

1.3
(61.5%)

1

0.5

5

0

0
FY10.1Q

FY11.1Q

FY12.1Q

FY10.1Q

FY11.1Q

FY12.1Q

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

12

Sony Life Operating Performance (6)Number of Lifeplanner Sales Employees(Number)

4,500
4,066
(49)

4,026
(51)

4,023
(62)

3,996
(66)

4,098
(79)

4,116
(71)

4,000

(18)

3,500

3,000
0
11.3.3111.6.30

11.9.30

Note: Figures in ( ) show the numbers of Lifeplanner sales employees (rehired ona fixed-term contract basis after retirement) included in the overall numbers.

11.12.31

12.3.3112.6.30* “Lifeplanner” is a registered trademark of Sony Life Insurance Co., Ltd.

13

Sony Life Operating Performance (7)Breakdown of General Account Assets
12.3.31<Asset management review>

12.6.30(Billions of yen)Amount%Amount%3,975.7

83.2%

4,113.8

83.9%

On the asset side, we lengthened the duration of
securities held to match the liability characteristics of
insurance policies with long-term maturities with theaim of reducing interest rate risk.

Japanese stocks

45.0

0.9%

37.6

0.8%

Japanese government and corporate bonds:
Continue to accumulate ultralong-term bonds in FY12

Foreign securities

59.6

1.2%

60.4

1.2%

Foreign stocks

30.5

0.6%

30.1

0.6%

Monetary trusts

288.2

6.0%

292.5

6.0%

Japanese governmentand corporate bonds<Lengthened
asset duration><L

Policy loans

138.7

2.9%

138.8

2.8%

Real estate

72.9

1.5%

72.4

1.5%

Cash and call loans
Others
Total

64.8

1.4%

46.3

0.9%

102.6

2.1%

111.0

2.3%

4,778.5

100.0%

4,903.2

100.0%

11.3.3118.5 years

12.3.3119.2 years

12.6.30

19.2 years■Investment in the monetary trusts is mainly into Japanese
government and corporate bonds.
■The holding ratio on the real status, of Japanese government andcorporate bonds including those invested in monetary trusts in thegeneral account assets:
As of June 30, 2012: 89.9%, (As of March 31, 2012: 89.2%)

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

14

Highlights of Operating Performance:
Sony Assurance
Ordinary revenues

20.4

Ordinary profit+6.3%(Billions of yen)

21.7

0.7

FY11.1Q

0.7

FY12.1Q

Change

20.4

21.7

+1.2

+6.3%

Underwriting income

20.2

21.4

+1.2

+6.3%

Investment income

0.2

0.2

+0.0

+6.4%

19.6

21.0

+1.3

+6.8%

Underwriting expenses

15.1

16.1

+1.0

+6.8%

Investment expenses

0.0

0.0

(0.0)

(93.2%)

Operating, general andadministrative expenses

4.5

4.8

+0.3

+7.0%

Ordinary profit

0.7

0.7

(0.0)

(8.0%)Net income

0.4

0.4

(0.0)

(9.4%)

Ordinary revenues(8.0%)

FY11.1Q

Ordinary expenses

FY12.1Q(Billions of yen)Ordinary revenues increased but ordinary profit
decreased year on year.
Ordinary revenues increased owing to an increase in
net premiums written atop growth in the number of
insurance policies in force centered on automobile
insurance.
Ordinary profit decreased owing mainly to an increasein the loss ratio caused by higher net losses paid forautomobile insurance.

(Billions of yen)

12.3.3112.6.30

Change from 12.3.31

Underwriting reserves

67.3

69.8

+2.5

+3.7%

Total net assets

18.0

18.4

+0.4

+2.4%

118.6

120.0

+1.4

+1.2%

Total assets

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

15

Overview of Performance:
Sony Assurance(Billions of yen)

FY11.1Q

FY12.1Q(Reasons for changes)

ChangeDirect premiums written

20.0

21.2

+6.0%

Net premiums written

20.2

21.4

+6.3%

Net losses paid

10.2

11.4

+11.6%

0.5

0.4(13.0%)Net loss ratio

56.9%

59.9%

+3.0ptNet expense ratio

24.6%

24.5%

(0.1pt)Combined ratio

81.4%

84.4%

+3.0ptUnderwriting profit

Net expense ratio is equal to the ratio of total underwriting costs to net premiums written.
Net loss ratio is equal to the ratio of net losses paid and loss adjustment expenses to net premiums written.

12.3.31
Number of policies in force
Solvency margin ratio Increased owing to an increase in the numberof policies in force for automobile insurance.

 Increased owing mainly to an increase in thenumber of policies in force for automobile
insurance, as well as rising unit cost of
insurance claims and influences of natural
disasters.

 Increased due to an increase in the number ofpolicies in force for automobile insurance.

12.6.30

Change from 12.3.31

1.49 million

1.51 million+0.02 million

557.8%

558.8%The number of policies in force is the total of automobile insurance andmedical and cancer insurance, which accounts for 99% of net premiums written.

+1.5%+1.0ptLine item amounts are truncated below ¥ 100 million; numbers of policies aretruncated below 10,000 policies; percentage change figures are rounded.

16

Sony Assurance’s Underwriting Performanceby Type of Policy
Direct Premiums Written

Net Premiums Written

FY11.1Q

FY12.1Q

FY11.1Q

Change(Millions of yen)
Fire

32

63

+97.9%

Marine－－－Personal accident*

1,805

1,931

+6.9%

Voluntary automobile

18,184

19,219

+5.7%

－

－

－

20,022

21,214+6.0%

Compulsory
automobile liability
Total

FY12.1Q

Change(Millions of yen)
Fire

61

69

+11.6%

Marine242－Personal accident*

1,875

2,001

+6.8%

Voluntary automobile

18,117

19,150

+5.7%

150

217

+45.1%

20,20821,481+6.3%

Compulsory
automobile liability
Total*SURE, medical and cancer insurance is included in personal accident.

Net losses paid
FY11.1Q

FY12.1Q

Change(Millions of yen)
Fire

7

0

(95.3%)

Marine8122－Personal accident*

426

467

+9.5%

Voluntary automobile

9,627

10,631+10.4%

Compulsory
automobile liability

197

239

+21.3%

10,267

11,461+11.6%

Total

Line item amounts are truncated below ¥ 1 million;
Percentage change figures are rounded.

17

Sony Assurance Operating Performance (1)Net Premiums Written andNumber of Policies in Force
Voluntary automobile insurance

Personal accident insurance(Millions of policies)

Number of policies in force

Other

+7.0%

30

1.51

1.5

1.4

1.30

0.1 18.8
1.8

1.6(Billions of yen)

1.41

(Billions of yen)

20

Ordinary Profit

0.2

20.2
1.8

+6.3%

21.4 0.3
2.0

1.2
1

1

0.7

0.8

16.8

18.1

(8.0%)

0.7

19.1
0.6
0.5

10

0.4

0.4
0.2
0

0
FY10.1Q

FY11.1Q

FY12.1Q

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
FY10.1Q

FY11.1Q

FY12.1Q

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

18

Sony Assurance Operating Performance (2)Reference
Earned/Incurred Loss Ratio +Net Expense Ratio
Earned/Incurred loss ratio
(%)
100

95.2

Combined Ratio(Net Loss Ratio+ Net Expense Ratio)
Net loss ratio

Net expense ratio

98.1
90.3

93.4

89.9 +3.5pt

(%)
100

85.6
80

Net expense ratio

89.0
79.1

80

81.4

+3.0pt+3.6pt

60
69.7

72.4

66.4

65.3

84.4

+3.0pt

68.9

60
60.0

63.3

25.5

25.7

55.2

56.9

59.9

40

40

20
25.5

25.7

20

(0.1pt)

23.9

24.6

24.5

FY10.1Q

FY11.1Q

FY12.1Q(0.1pt)

23.9

24.6

24.5

FY10.1Q

FY11.1Q

FY12.1Q

0

0
FY10

FY11

FY10

FY11

Earned/Incurred loss ratio is equal to the ratio of the sum of net losses paid, loss adjustment

Net expense ratio is equal to the ratio of total underwriting costs to net premiums written.

expenses and accumulation in provision for reserve for outstanding losses to earned premiums.

Net loss ratio is equal to the ratio of net losses paid and loss adjustment expenses to*Note that earthquake insurance and compulsory automobile liability insurance are excluded

net premiums written.

from the above calculation.

19

Sony Assurance Operating Performance (3)Solvency Margin Ratio
(%)

1,200

800
+1.0pt631.0%

557.8%

558.8%

400

011.3.3112.3.3112.6.30

Note: The above-stated figures of solvency margin ratio are calculated according to the new standards which became effective as of the end of fiscal year 2011
(March 31, 2012).

20

Highlights of Operating Performance:
Sony Bank (Consolidated/Non-consolidated)
Consolidated ordinary revenues
Consolidated ordinary profit

8.3<Consolidated>

FY11.1Q

FY12.1Q

Consolidated ordinary revenues

7.4

8.3

+0.9

+12.4%

Consolidated ordinary profit

1.0

1.0

(0.0)

(0.5%)

Consolidated net income

0.5

1.4

+0.8

+154.1%

FY11.1Q

FY12.1Q

Ordinary revenues

7.4

7.5

+0.0

+0.9%

Gross operating profit

4.5

4.4

(0.0)

(1.7%)Net interest income

3.8

4.0

+0.1

+5.0%

Net fees and commissions

0.06

0.04

(0.01)(27.9%)Net other operating income

0.5

0.3

(0.2)

(43.6%)

General andadministrative expenses

3.3

3.5

+0.1

+4.3%

Ordinary profit

1.1

0.8

(0.2)

(20.8%)Net income

0.6

(1.2)

(1.8)

―

Net operating profit

1.1

0.9

(0.2)

(21.3%)(Billions of yen)

7.4
+12.4%

Change<Non-consolidated>(Billions of yen)

1.0

1.0
(0.5%)

FY11.1Q

FY12.1Q (Billions of yen)<Consolidated>
Consolidated ordinary revenues increased year on year due to anincrease in net fees and commissions resulting from Sony Bank’s
acquisition of SmartLink Network, Inc. as its consolidated
subsidiary. Consolidated ordinary profit remained at the samelevels. Consolidated net income increased due to recording
deferred tax assets related to accumulated losses of Sony Bank
Securities Inc.
<Non-consolidated>Gross operating profit decreased year on year due to a decreasein profit related to foreign currency transactions which offset
higher interest received on loans due to an increase in thebalance of mortgage loans.
Net income decreased owing to recording impairment losses on
stocks of Sony Bank Securities Inc. resulting in a loss of ¥1.2
billion.
Net operating profit decreased owing to higher general andadministrative expenses led primarily by personal reinforcement
for business expansion.

(Billions of yen)
Total net assets
Net unrealized gains
on other securities (net of taxes)
Total assets

Change12.3.3112.6.30

Change from 12.3.31

62.7

61.1

(1.6)

(2.6%)

1.7

1.8

+0.0

+4.7%

1, 890.5

1,902.0

+11.5

+0.6%

Line item amounts are truncated below ¥100 million except for net fees and commissions;percentage change figures are rounded.

21

Overview of Performance:
Sony Bank (Non-consolidated) (1)(Reasons for changes)
11.6.30

12.3.3112.6.30

1,772.2

1,864.3

1,868.0

+3.7

+0.2%

Deposits

1,664.5

1,762.2

1,767.2

+4.9

+0.3%

Yen

1,299.4

1,390.5

1,401.8

+11.2

+0.8%

365.0

371.7

365.4

(6.2)

(1.7%)

107.6

102.0

100.8

(1.2)

(1.2%)

748.3

835.5

866.4

+30.8

+3.7%

Mortgage loans

676.1

749.6

774.4

+24.8

+3.3%

Others72.1

85.9

92.0(*1)

+6.0

+7.1%

Change from 12.3.31(Billions of yen)
Customer assets

Foreign currency
Investment trusts
Loans outstanding*1

Capital adequacy ratio(domestic criteria) (*2)

10.65%

11.58%

11.29%(0.29pt)

Tier 1 ratio

10.22%

9.63%

9.36%

(0.27pt) Yen deposit increased due to the positiveeffect of special campaigns associatedwith the 2012 summer bonus season.

 Foreign currency deposit slightly
decreased reflecting the yen’s
appreciation that had the negative impact
on the foreign exchange conversion(negative impact of ¥18.1 billions).
 Balance of investment trusts decreased
due to the impact of a decline in the Net
Asset Value (NAV).
 Loan balance increased due to anincrease in the balance of mortgage loans,in addition to a higher corporate loanbalance centered on syndicated loans.

*1 Loans in others include corporate loans of ¥84.9 billion.
*2 Please refer to the graph of the non-consolidated capital adequacy ratio (domestic criteria) on P25.
.

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

22

Overview of Performance:
Sony Bank (Non-consolidated) (2)<Reference> On Managerial Accounting Basis<Reference> Interest Spread(Managerial Accounting Basis)

FY11.1Q

FY12.1Q

4.5

4.4

(0.0)

(1.7%)Net interest income *1 ①

4.1

4.2

+0.0

2.4%

Net fees andcommissions *2 ②

0.3

0.1

(0.1)

(35.5%)Net other operating
income *3

0.0

0.0

(0.0)

－

Gross operating profit(core profit) (A)
= ①＋②

4.4

4.3

(0.0)

(0.3%)

Operating expenses andother expenses ③

3.3

3.5

+0.1

+5.2%

Net operating profit(core profit)= (A)－③

1.0

0.8

(0.1)

(17.2%)(Billions of yen)
Gross operating profit

ChangeYield on investment(%)

Yield on financing

Interest spread

1.50
1.37

1.00

0.94

1.31

(0.04pt)

0.90●Managerial accounting 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 adjustments (*1 and *2), consists of profits
and losses for bond and derivative dealing transactions.
●Core profit
Profits and losses exclude net other operating income, which includes those on bond andderivative dealing transactions, and stands for Sony Bank’s basic profits.

0.50

0.43

0.41

FY11.1Q

FY12.1Q

0.00
Note: Interest spread=(Yield on investment)-(Yield on financing)Line item amounts are truncated below ¥100 million; percentage change figures are rounded.
The calculation method on a managerial accounting basis was partly changed from FY12.1Q. Accordingly, the figures for FY11.1Q were retroactively calculated.

23

Operating Performance:
Sony Bank (Non-consolidated) (1)
Deposits
Yen deposits

Loans
Mortgage loans

Foreign currency deposits

Others*Including corporate loans of ¥84.9 billion.

(Billions of yen)

866.4

(Billions of yen)

835.5

+30.8

92.0*

800

722.4

2,000

1,762.2
1,649.1+4.9*Corporateloans of¥84.9 billion.

1,767.2
365.4

600

1,500

400

1,000

774.4
1,401.8

500

200

0

0

11.3.3112.3.3112.6.30

11.3.3112.3.3112.6.30

Line item amounts are truncated below ¥100 million.

24

Operating Performance:
Sony Bank (Non-consolidated) (2)Non-Consolidated Capital Adequacy Ratio(Domestic Criteria)

Balance of Securities by Credit Ratings
AAA
BBB

AA
Other

A

Capital Adequacy Ratio

Tier1 Ratio(%)
15(Billions of yen)

1,200

11.58

(0.29 pt)

11.29

10.84
1,000

940.1

917.9

912.9
+5.0

10

10.41
800

9.36
9.63
(0.27 pt)

600

5

400

200

0
11.3.310
11.3.3112.3.3112.6.30

12.3.3112.6.30* Sony Bank’s non-consolidated capital adequacy ratio was calculated based on the standard
stipulated by Article 14-2 of the Banking Act, in accordance with FSA Notification No. 19(2006).
Amounts are truncated below ¥100 million.

25

Consolidated Financial Forecast
for the Year Ending March 31, 201326

Consolidated Financial Forecast
for the Year Ending March 31, 2013
■SFH’s forecast of consolidated financial results for FY2012 is unchanged from the forecast announced on May 10, 2012.
FY2011(Billions of yen)

Consolidated ordinary revenues

Actual

FY2012
Forecast

Change1,078.0

1,115.0+3.4％

Banking business

967.5
80.0
32.5

994.5
86.8
34.5

+2.8％
+8.4％
+6.0％

Consolidated ordinary profit

74.6

67.0

(10.2％)

Life insurance businessBanking business

68.1
2.8
3.4

61.5
2.6
3.6

(9.8％)(9.1％)+3.9％

Consolidated net income

32.8

37.0

+12.8％

Life insurance business
Non-life insurance business

Non-life insurance businessNote: From FY2012, SFH will omit its half-year results forecast, which it previously announced, reflecting the SFH Group’s long-term business structure
as a financial institution.
■Life insurance business
Ordinary revenues for FY2012 are expected to increase year on year. In the current fiscal year, we do not expect to record an increase in investment income that we posted at the previous
year-end due to the market, although we do anticipate that income from insurance premiums will increase in line with steady growth of the policy amount in force.
Ordinary profit is expected to decrease, since we do not anticipate the profit recorded in the previous fiscal year. In the previous fiscal year, Sony Life recorded a profit due to lower
insurance claims and other payments relating to the Great East Japan Earthquake than we had estimated at the end of March 2011, as well as gains on sale of securities, reflecting theprocess of shifting bond holdings to ultralong-term bonds. However, we do not anticipate such gains for FY2012.
■Non-life insurance business
Ordinary revenues for FY2012 are expected to increase year on year, owing to an increase in net premiums written, primarily for automobile insurance.
Ordinary profit is expected to slightly decrease, mainly because we expect the loss ratio to stay at a high level and the expense ratio to slightly increase resulting from an increase insystem-related expenses.
■Banking Business
Ordinary revenues for FY2012 are expected to rise year on year, owing mainly to a growing balance of loans, especially mortgages.
Ordinary profit is expected to rise, as we anticipate a steady increase in gross operating profit, driven by business expansion.

(Amounts are truncated below ¥100 million; percentage changes are rounded.)27

Sony Life’s MCEV
andRisk Amount Based on Economic Valueas of June 30, 201228

Sony Life’s MCEV and Risk Amount Based on
Economic Value as of June 30, 2012
(Billions of yen)

12.3.3112.6.30

Change from(JGB yield)(JGB yield)

12.3.31

MCEV

1,041.5

1,054.5+12.9

Adjusted net worth

409.2

432.3

+23.1

Value of existing business

632.4

622.2

(10.2)(1) Calculated MCEV for policies in force as of June 30, 2012 by using updated lapse and surrender rate and economic assumptions.
(2) Adopted simplified method for a part of MCEV calculations as of June 30, 2012.

(Reason for change) The value of existing business as of June 30, 2012, was down about ¥10.2 billion from March 31, 2012, due mainly to a
decline in ultralong-term interest rates, which offset the positive impact including the addition of new business value.
On the other hand, adjusted net worth was up approximately ¥23.1 billion due to an increase in prices of ultralong-term
JGBs held from an ALM perspective despite the dividend payout to a shareholder.
Consequently, MCEV as of June 30, 2012, was up from March 31, 2012.
* Please keep in mind that the validity of these calculations has not been verified by outside specialists.

(Billions of yen)

The risk amount based on
economic value

12.3.31551.5

12.6.30
578.8

Change from 12.3.31+27.3

Note: Measurement of risk based on economic value takes one-year VaR to be 99.5% and is measured using an internal model that refers to the
EU Solvency II (QIS5) standard model.

29

Appendix

30

Recent Topics 1
AEGON SONY LIFE INSURANCE Sales Update
Launch of sales：December 1, 2009
Common stock：¥20 billion (including capital surplus of ¥10 billion)
Equity ownership：Sony Life insurance Co., Ltd. 50%, AEGON・international B.V. 50%
Marketing products: Individual Variable Annuities (2 types, 4 products)
Sales Channels: Lifeplanner sales employees and partner Banks (7*) As of August 13, 2012
Financial Highlights for FY12.1Q:
Number of new policies: 1,075, New policy amount: ¥7.4 billion
Number of policies in force: 4,726 policies, Policy amount in force: ¥36.8 billion (As of June 30, 2012)

Sony Bank’s Mortgage Loans through Sony Life
Sony Life accounts for 25% of the balance ofmortgage loans as of June 30, 2012
Sony Life accounts for 27% of the amount of
new mortgage loans for FY12.1Q*Sony Life started handling banking agency business in January 2008.

Sony Assurance’s Auto Insurance Sold by Sony Life
Sony Life accounts for approx. 5% of new automobile policies
for FY12.1Q* Sony Life started handling automobile insurance in May 2001.
“Lifeplanner” is a registered trademark of Sony Life Insurance Co., Ltd.

31

Recent Topics 2<Highlights for FY12.1Q>
2012-5-16

Sony Life launched the first phase of its “Co-Creation Project”

2012-6-21

Sony Life started managing an official Facebook page

2012-7-23

Sony Assurance launched renewed official website and smartphone site

2012-7-27

Sony Assurance began providing smartphone applications designed to assist drivers to be conscious of the importance ofsafe driving, to solve problems when troubled and to get estimates and apply for automobile insurance via smartphone.
Sony Assurance is the first Japanese automobile insurance provider to offer these smartphone applications and services.

2012-8-01

AEGON Sony Life Insurance began offering a new individual variable annuity product, "With Family" through Sony Life's
Lifeplanner sales employees

2012-8-01

Sony Bank transferred all Sony Bank securities’ shares to Monex Group with the aim of enhancing financial products
intermediary services through strengthening business alliance with Monex Group.

32

Sony Life: Fair Value Information on Securities(General Account Assets)
Fair Value Information on Securities
zFair value information on securities with market value (except trading-purpose securities)(Billions of yen)zValuation gains (losses) on trading-purpose securities(Billions of yen)

Notes: 1) Line item amounts are truncated below ¥100 million. 2) Amounts above include those categorized as “monetary trusts.”33

Sony Life’s Breakdown of Net Assets
Net Assets on BS, Real Net Assets and Solvency Margin(Billions of yen)
①Net Assets
(B/S)

②Real
Net Assets③Solvency
Margin12.3.3112.6.30

12.3.3112.6.30

12.3.3112.6.30

Total shareholders’ equity

232.2

231.3

232.2

231.3

223.1

231.3

Net unrealized gains on other securities, net of taxes

34.0

42.3

34.0

42.3

－

－

－

－

－

－

54.6

65.4

Land revaluation, net of taxes

(1.3)

(1.3)

(1.3)

(1.3)

－

－

Reserve for price fluctuations

－

－

25.3

26.9

25.3

26.9

Contingency reserve

－

－

55.3

56.3

55.3

56.3

General reserve for possible loan losses

－

－

－

－

0.0

0.0

Net unrealized gains (losses) on available-for-sale securities

Net unrealized gains on real estate

－

－

0.6

0.6

(0.1)

(0.1)

Excess amount of policy reserves based on Zillmer method

－

－

350.4

355.7

304.4

315.2

Unallotted portion of reserve for policyholders' dividends

－

－

0.7

0.6

0.7

0.6

Deferred tax assets

－

－

－

－

58.7

62.4

Unrealized gains (losses) on held-to-maturity bonds

－

－

155.8

176.2

－

－

Deferred tax liabilities for available-for-sale securities

－

－

18.3

22.1

－

－

264.8

272.2

871.4

910.8

722.1

758.1

Total

Note: Real net assets excluding net unrealized gains (losses) on held-to-maturity securities and on policy reserve matching bonds, are¥715.5 billion as of March 31, 2012, and ¥734.6 billion as of June 30, 2012.

Notes③After estimateddistributed income
deducted③Before tax x 90%②Before tax（after revaluation）③Before tax(Before revaluation) X85%
(If losses X100%)③After deducting exclusion
amount②Before tax

Amounts are truncated below ¥100 million.

34

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

35