Iyogin Holdings Integrated Report 2023

Integrated
reportIntegrated Report 2023

Issued: July 2023
Edited: Public Relations Office, Corporate Planning Division,
Iyogin Holdings, Inc.
1, Minami-Horibata-cho, Matsuyama, Ehime 790-8514, Japan
TEL: 089-907-1011

About the Iyogin Group

Contents

Group Corporate Credo
03

History of the Iyogin Group05

Sources of Competitive Advantages (Strengths)

07

Earnings Overview

09

Financial and Non-Financial Highlights of the Group

Message from

11

Management Commitment

the Management

17

Special Feature Human Capital Management

25

Message from Officer in charge of Finance

27

Ideal State in the Long Term (Long-Term Vision)

29

Sustainability Management System

31

Value Creation Process

33

Striving for Improving CX

Business Strategy and35

Overview and Progress of Group Medium-Term Management Plan

Plan for Realizing

37

Corporate Related Strategies

the Long-Term Vision

41

Personal Related Strategies

45

Ship Related Strategies

47

Market Investment Strategies

49

BPR Strategies

51

New Businesses Strategies

53

Plan for Branches

54

Plan for IT

55

Response to Climate Change: Initiatives for
TCFD Recommendations

59

Initiatives for Sustainable Growth

65

Strong Management Foundation (Governance)

69

Strong Management Foundation (Governance)
Board of Directors and Executive Officers

Value Creation Story

Sustainability

Corporate Data

71

Strong Management Foundation (Governance) Risk Management

73

Strong Management Foundation (Governance) Compliance

75

Financial Date

Meaning of
Existence

Creating a bright and prosperous future for the region

Management
StanceOffering the best service and being worthy of people’s trust

Code of
Conduct

Rendering our best service with gratitude in our hearts

We create brightness and prosperity for people’s lives and businesses as a local corporategroup and establish a rich future together with the region.

We wholeheartedly provide comprehensive services of cutting-edge quality, with the aimof creating a corporate group that meets the expectations and is worthy of people’s trust.

We work unceasingly to be innovative, starting with gratitude in our hearts towards
our customers, and act resolutely with joy and purpose.

Integrated Report 2023: Logical Structure System
In order to elucidate the value creation story of Iyogin Holdings,
this report has been edited based on the logical structure shown in the figure below.
The “Integrated Report 2023” aims to promote opportunities for dialogue while allowing readers to gain a deeper understanding of the value
creation process of Iyogin Holdings. Throughout the document, we have included all the main components necessary for interpreting ourvalue creation process (the Group Corporate Credo, our long-term vision, business strategies, governance, etc.). In addition, we haveassembled the components into an integrated storyline to illustrate the process. The figure below shows the logical structure (connection) of
the main components that form the basis of the storyline.

A Universal Way ofThinking

B Long-Term Vision

C Strategy for Achieving

Targets

The Group Corporate
Credo is a universal wayof thinking that does notchange over time.

Based on the universal
way of thinking in A , wehave formulated ourlong-term vision, in viewof the environmental
changes of each era.

We have formulated the Fiscal 2021
Medium-Term Management Plan asa roadmap for us to realize B .

Group Corporate Credo

Long-Term Vision

Fiscal 2021 Medium-Term
Management Plan

E Business Strategies and Plans
Based on the strategy in C , we areconducting business activities that
center around six business strategies
and four plans.
Six Business Strategies

Business Strategy and Plan for Realizing
the Long-Term Vision

the Iyogin Group

Value Creation Story

Group Corporate Credo and Logical Structure System

Message from the Management

02

About the Iyogin Group

About

Four Plans

Sustainability

Leverage and reinforce our strengths and capital

107 Corporate date

D Strengths that Create Value andFoundation that Support Growth

G Value Creation Process
By realizing our long-term vision through conducting
business activities based on our universal values, we aim
to continue to grow as a company that wins social
sympathy.

The competitive strengths that we have cultivatedsince our founding drive our growth, and the capital
we have accumulated serves as a foundation forgrowth and supports our business activities. In
addition, we will enrich our human capital, which
will lead to further enhancement of corporate value.

Sources of Competitive
Advantages
Human CapitalManagement

1

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

Corporate Data

F Sustainability In order to fulfill our social responsibility regarding the realization of sustainable local communities, we actively implement
initiatives to solve social issues related to ESG. Moreover, based on the Group Corporate Credo, we continue to take on thechallenge of resolving these issues through both our business activities and social contribution activities.

2

About the Iyogin Group

History of the Iyogin GroupIyo Bank was founded in Kawanoishi, Honai-cho, Yawatahama-shi on March 15, 1878 as Ehime Prefecture’s
stimulate the local economy through the expansion, etc. of finance-related services by merging with otherfinancial institutions and establishing group subsidiaries for leasing, securities, etc.
In October 2022, we made a transition to a holding company structure and established Iyogin Holdings, Inc.
with the aim of responding as a more cohesive group to diversified and enhanced customer needs.
Based on our Group Corporate Credo of “creating a bright and prosperous future for the region,” we thus
contribute to the realization of a sustainable society.

2005-

Established a new business model, the “DHDmodel,” that leverages the advantages ofboth people and digital technology
2016Entered into “the TSUBASA Alliance”
Entered into “Shikoku Alliance”
2018140th anniversary of foundation
Established “Iyogin Challenge & Smile”
Established “Shikoku Alliance Capital”

Pursuing customer-oriented management whilestrengthening the business management system

1878-

2005
Acquired external credit ratings
2008Approved for Basel II fundamental internal rating based
approachObtained “Kurumin” certification mark for companies
supporting child rearing
2010Newly established “Ship Finance Office (currently Ship
Finance Division)”
Opened “Iyogin Insurance Plaza”
2011Introduced a benefit program for shareholders
Established CRM System
2012
Opened “Singapore Representative Office”
Opened “Internet Branch”
2014Introduced executive officer system
Formulated “Declaration of Promotion of Women’sParticipation”

2021
Introduced Group Chief Officer System
Endorsed the TCFD Recommendations
Set targets for the reduction in CO2 emission
Announced the policies on investments and loans for
specified sectors
Newly established micro branches “Iyogin SMART”
Introduced “wevox,” an engagement detection toolIntroduced a smartphone app “AGENT”
Introduced a life plan simulation tool “LIFE PALLETTE”
2022
Setting of sustainable finance target
Established the Sustainability Committee
Newly established function-specific branches “Iyogin
SMARTplus”
Introduced “Iyogin-style job-based personnel system”
2023
Recognized in the “2023 Certified Health & Productivity
Management Outstanding Organizations Recognition
Program” and chosen as one of the top 500 enterprises(White 500)
Announced our “Commitment to Diversity, Equity, andInclusion (DE&I)”

Business Strategy and Plan for Realizing
the Long-Term Vision
Sustainability

1878
Established “The 29th National Bank”
Established “The 52nd National Bank”
1934
Established “The Yoshu Bank”(The 29th National Bank merged with the Yawatahama
Commercial Bank and the Ozu Bank)
1941
“Allied Iyo Bank” was established(The Imabari Commercial Bank merged with Matsuyama
Gojuni Bank and the Yoshu Bank)
1951
Name changed to “Iyo Bank”
1974
Established “Iyogin General Leasing (currently Iyogin
Leasing)”
1975
Established “Iyo Computer Service(currently Iyogin Computer Service)”
1978
Established “Iyo Credit Guaranty(currently Iyogin Credit Guaranty)”
1979
Established “The Iyogin Business Service(currently The Iyogin Business Service)”
1985
Established “Iyogin Capital (currently Iyogin Capital)”
1988
Established “Iyogin Regional Economy Research Center”
Established “Iyogin DC Card”
1990
Name changed to “Iyo Bank”
1992
Merged with Toho Mutual Bank

2015
Transitioned to a company with an Audit and Supervisory
Committee
Newly established the Advisory Board
Established the Corporate Governance Guideline
2016
Opened “Singapore Branch”
Introduced Satto Madoguchi (Quick Counter)2017
Announced Our Commitment to Fiduciary Duty
Obtained “Platinum Kurumin” certification mark forcompanies supporting child rearing
Opened “Iyogin Kids’ Land,” a day-care center for children
on a premiseIntroduced a smartphone app “MONEY MANAGER”
2018Formulated the Disclosure Policy
2019Introduced AGENT tablets
Introduced “HOME,” a smartphone-based digital housing
loan service
2020
Established “Shikoku Brand”
Introduced the side job system
Introduced the complete flexible working hour system
Introduced “SAFETY,” a digital card loan service
Introduced the business casual attire
Obtained “Eruboshi (three stars)” certification mark forcompanies excellent in efforts for promotion of women’s
participation).

October 2022
Established “Iyogin Holdings”
April 2023
Established “Iyogin Digital Solutions”

Value Creation Story

Trust and strong customer base cultivatedover many years

2012Established “Iyogin Securities(currently Shikoku Alliance Securities)”

To become a corporate group that create
and provide new value by further
deepening and evolving the DHD model

Message from the Management

aim to earn the unwavering trust of our shareholders, customers and local residents, which in turn will

2015-

About the Iyogin Group2021-

first national bank, the 29th National Bank. Iyo Bank has made efforts to stabilize regional financing andCorporate Data

3

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

4

About the Iyogin Group

Sources of Competitive Advantages (Strengths)
1 Diverse Industrial Structures

Strength

The Group consists of 11 companies, which handle conventional banking, as well as securities, leases, credit guarantee, credit cards,
venture capital operations, system development, think tank operations, business support, and other services, including a consulting
company established in April 2023 to provide DX support, etc. for regional companies. The Group satisfies diverse needs ofcustomers in the region by using the transition to a holding company structure as an opportunity to further accelerate integrated
group management, and further enhancing the expertise of each company.

Message from the Management

Ehime Prefecture can be roughly divided into three regions: Toyo, Chuyo, and Nanyo.
Toyo serves as a top-class engine of the secondary industry in Japan. Imabari, a maritime city known for shipbuilding and oceantransport, is also the top national producer of towels. Furthermore, a range of industrial cities are found, including Niihama andSaijo, where manufacturers in the nonferrous metal, chemicals, steel and other industries are located, and Shikokuchuo, one of thebest-known places in Japan for paper manufacturing and processing.
Chuyo is home to a variety of industries, mainly in the tertiary sector. The prefectural capital Matsuyama is known for tourism,
represented by Dogo Onsen; commerce; and the service industry. Also located in the area are factories of large manufacturers, aswell as large companies that enjoy high shares in small once-through steam boilers, farm machinery, and dried bonito shavings.
Nanyo is focused on the primary industry. Yawatahama is widely known as one of the largest citrus fruit producers in Japan.
Uwajima and Ainan are known for the sea culture industry, producing cultured sea breams, yellowtails, and pearls, as well as for the
manufacturing of food products, especially processed marine products.

3 Comprehensive Ability of the Group

About the Iyogin GroupStrength

Iyo Bank
Shikoku Alliance Securities

Iyogin Digital Solutions

BankingIndustries with top national shares concentrated in each region
Manufactured product shipments from Ehime Prefecture
totaled ¥3.8 trillion (43.8% of Shikoku) in 2020

32.7

No.1 in Japan*2

Chuyo

Towels (2020)¥51.6 billion shipped in Japan

Uma (Shikokuchuo) Region

Toyo

Nanyo

7.6%

(¥540.0 billion)

Niihama Region

15.4%

Manufactured
product shipments (2020) ¥1,592.3 billion
Approx. 41.9% of shipments of manufactured products in Ehime(¥69.5 billion)

No.1 in Japan*2

As a corporate town under the Sumitomo Group, nonferrous metal,
chemicals, steel, machinery and equipment are concentrated
particularly in the Niihama region.

Sea culture industry (2021)¥451.5 billion total national production

1909: Usuki (Oita); 1919: Nigata (currently Kure,
Hiroshima);
1947: Takamatsu (Kagawa), Kochi, Oita; 1950:
Hiroshima;
1952: Osaka; 1954: Tokyo; 1958: Tokushima;
1963: Kitakyushu (Fukuoka); 1964: Okayama;
1965: Nagoya (Aichi); 1966: Kobe (Hyogo);
1971: Fukuoka; 1979: Tokuyama (Yamaguchi)
Fukuoka

Iyogin Regional Economy Research Center

Iyo Bank: 8 branches
Iyogin Leasing: 1 branch

Kinki region

Iyo Bank: 1 branch

Iyo Bank: 5 branches
Iyogin Leasing: 1 branchTokyo region

Okayama

Overseas region

Yamaguchi
Osaka

Within Ehime
Iyo Bank: 119 branches
Iyogin Leasing: 6 branches
Shikoku Alliance Securities:
6 branches
Oita

Iyo Bank: 1 branch and 2 offices

KagawaTokushima
Kochi

Shikoku region, excluding Ehime
Iyo Bank: 7 branches
Iyogin Leasing: 1 branch

Iyogin Capital

Number of Iyo Bank branches
151 domestic branches, 1 overseas branch, and 2
overseas representative offices(including 2 Iyogin SMART branches)(including 4 Iyogin SMARTplus branches)(including 24 branches within branches)

Strength

4 Diverse Human Resources with Expertise

Since the past, the Group has considered that humanresources capabilities as the source of competitiveness edge,
based on the understanding that there is no excessive
investment in human resource development. The Group has
thus strived to develop human resources with a high level ofexpertise and a diverse range of skills.
In October 2022, the personnel system has undergone amajor overhaul to better embody these ideas, which resulted
in the introduction of the concept of “career fields” as one of
the mechanisms to allow employees to play a more active roleby enhancing their individual strengths and areas of expertise
independently.
We aim to create a proactive learning environment andresponse to diversification of careers, while continuing to
strive for a consulting group which can create and offer
diverse types of value.

Holders of advanced qualifications (As of March 31, 2023)
1st grade Certified Skilled Professional of
Financial Planning, and CFP
Small and Medium-sized Enterprise
Consultants

181
75

MBAs

5

Securities Analysts and Certified
International Investment Analysts

83

Network Specialists

8

Employees with a TOEIC score of 700 or
higher

92

Number of Iyogin Leasing branches Number of Shikoku Alliance Securities branches

11 prefectures in the Setonaikai region
Iyogin Holdings Integrated Report 2023

Iyo Bank: 2 branches

Hyogo

Hiroshima

Iyogin DC Card

Corporate Data

Kyushu region

Chugoku region
Iyo Bank: 9 branches
Iyogin Leasing: 2 branches

Creditcards

VenturecapitalSustainability

Timing of opening key branches outside of Ehime

Iyogin Leasing

The Iyogin Credit
Creditguarantee Guaranty

Think
tank

2 Strong Operating Base and Broad Regional Coverage

Tokai region

5

The Iyogin Business
ServiceBusiness
Iyogin Challenge
support& SmilePulp and paper industry (2020)¥7,095.7 billion shipped in Japan

Iyo Bank, which is the core corporate of the Group, boasts the top amount of funds among regional banks in Shikoku.
Headquartered in Ehime Prefecture, where the Bank has a 53.0% share in deposits and a 35.5% share in loans, we have establisheda strong operating base as the top bank in the region.
We have also created the No. 1 bank network among regional banks in terms of broad regional coverage, in 13 prefectures
centered on the Setouchi region. The Bank has not only a strong operating base in Japan but also a branch in Singapore andrepresentative offices in Hong Kong and Shanghai, building a structure that can support its customers.
To use our management resources efficiently while maintaining local contact points, we have been conducting a review of branchlocations, including reorganization of branches. Simultaneously, we offer optimal services for our customers by developing newchannels using digital technologies, in order to diversify customer contact points and improve convenience.

Lease

Iyogin GroupNo.2 in Japan*2
Source: Prepared based on the Statistics
Bureau of Japan’s “2021 Economic Census
for Business Activity (2020 actual)” and theMinistry of Agriculture, Forestry and
Fisheries’ “total fishery output for 2021
(preliminary figures).”

Systemdevelopment

Business Strategy and Plan for Realizing
the Long-Term Vision*1 Iyogin Regional Economy Research Center, Inc. (IRC) estimates; the ranking in Japan excludes vessels owned by major ocean transport companies.
*2 Ranking of Ehime Prefecture

Iyogin Computer
Service

Value Creation Story

Number of ocean-going vessels
owned by domestic ship owners(As of September 2020)*1
3,663 total vessels in JapanThe Matsuyama region has companies with large
shares in products such as small once-through steam
boilers, farm machinery,” and dried bonito shavings.

Strength(¥29.7 billion)

No.1 in Japan*

Matsuyama Region

Securities

57.5%

%
(1,199 vessels)2…Total national share of Ehime Prefecture

Uwajima Region

Consulting

Imabari Region

11 domestic branches

6 domestic branches
Iyogin Holdings Integrated Report 2023

6

About the Iyogin Group

Earnings Overview
Business Results for Fiscal 2022

Business Performance Forecasts for Fiscal 2023
 he Company
T(consolidated)

Fiscal 2022

Core business gross profit

90.4

89.5

(0.9)

Of which, interestand dividend income
Of which, fees andcommissions
Of which, otheroperating income

72.6

75.3

+2.7

9.3

9.6

+0.3

8.4

4.5

(3.9)

Expenses (-)

51.6

52.6

+1.0

Core business net income

38.8

36.8

(2.0)

Credit costs (-)

4.3

(2.5)

(6.8)

Gain (loss) related tosecurities

1.1

0.0

(1.1)

Ordinary income

38.2

42.4

+4.2

Profit attributable to owners of parent

26.4

27.8

+1.4

YoY

 eference: Iyo BankR
(non-consolidated)

Fiscal 2023
forecasts

YoY

Core business gross profit

90.5

+1.0

Expenses (-)

55.0

+2.4

Core business net income

35.5

(1.3)

Credit costs (-)

5.0

+7.5

Gain (loss) related tosecurities

2.5

+2.5

Ordinary income

36.0

(6.4)

Profit attributable toowners of parent

25.5

(2.3)

Core business gross profit

85.0

+0.9

Expenses (-)

52.5

+2.2

Core business net income

32.5

(1.2)

 eference: Iyo BankR
(non-consolidated)

84.5

84.1

(0.4)

Ordinary income

34.0

(5.2)

Expenses (-)

49.0

50.3

+1.3

Net income

24.0

(2.3)

Core business net income

35.4

33.7

(1.7)

Credit costs (-)

4.2

(2.8)

(7.0)

Gain (loss) related tosecurities

1.1

(0.4)

(1.5)

Ordinary income

35.2

39.2

+4.0

Net income

24.6

26.3

+1.7

(Units: Billions of yen)

6,823.2

7,000

6,000
5,326.0

Balance of Loans and Deposits
Balance of Deposits, etc.

5,000

Loan Balance of Loans

Business Strategy and Plan for Realizing
the Long-Term Vision

Core business gross profit

Value Creation Story

Fiscal 2021

(Units: Billions of yen) he Company
T(consolidated)

Message from the Management

In fiscal 2023, global inflation and monetary tightening willcontinue to pose risks of economic deterioration, and Japanmay possibly turn from a long period of monetary easing.
Accordingly, the Group believes that we will have to steer thebusiness in more difficult circumstances than ever.
Even under such circumstances, we aim to continue
securing a high level of core business gross profit, as we
intend to continue to increase our balance of loans anddeposits and also expect that the increased procurement costburden due to higher foreign interest rates will peak out.
Profit attributable to owners of parent is expected tounavoidably decrease from the previous fiscal year, when arecord-high profit was recorded, as expenses are expected toincrease due to aggressive strategic investments and anincrease in costs is also expected as a rebound from thereversal of credit costs in the previous year. However, we
expect profit levels to remain favorable, exceeding the major
numerical targets set forth in the Medium-Term Management
Plan.

(Units: Billions of yen)

About the Iyogin GroupIn fiscal 2022, the business environment surrounding the
Iyogin Group continued be challenging, as exemplified byrising overseas interest rates against a backdrop of global
inflation. Under such circumstances, we worked to increase
the loan balance mainly in the Setouchi region which is the
management foundation of the Group. In addition, in
securities, we worked to improve profitability by promoting
bond switching in response to market trends even in thesituation where there was a stronger pressure to reduce
margins in response to the rise in foreign interest rates. As aresult, interest and dividend income amounted to ¥75.3
billion, up ¥2.7 billion year on year. On the other hand, otheroperating income decreased due in part to higher hedge costs
using derivatives, resulting in a year-on-year decrease of ¥0.9
billion in consolidated core business gross profit to ¥89.5
billion. Despite the drop in profit, we have successfully
continued to secure a high level of top-line profit.
In addition to securing the high level of core business grossprofit, credit costs decreased by ¥6.8 billion year on year
thanks to improvements in customers’ business performanceand reversal of preventive provisions for the COVID-19
pandemic which were recorded in the past. As a result,ordinary income amounted to ¥42.4 billion, up ¥4.2 billion
year on year and profit attributable to owners of parent
amounted to ¥27.8 billion, up ¥1.4 billion year on year. In
terms of profit attributable to owners of parent, we posted arecord-high profit on a consolidated basis.

4,000
Sustainability

3,000

2,000

1,000

7

Iyogin Holdings Integrated Report 2023

1950

1960

1970

1980

1990

2000

2010

2022

Corporate Data

1943

0

Iyogin Holdings Integrated Report 2023

8

About the Iyogin Group

Financial and Non-Financial Highlights of the Group
Financial Highlights

Non-financial Highlights

Balance of Loans (Bank Nonconsolidated) Consolidated Core Business Gross Profit(Units: Billions of yen)

(Units: Billions of yen)

6,522.6

6,823.2
6,654.1

4,999.3

5,068.8

5,326.0

86.6

Investment Amount of HR Development/Hours of Training Overtime Work Hours

90.4

89.5

56.1
46.3

227

174

52.6

(Units: %)

50.0

18.0

16.3

189 180200

17.6

4.2 5.0

4.4

18.6

20.0

Message from the Management

47.2

Female Manager Ratio(Units: Hours)

Amount invested (Units: Thousands of yen)
Hours of training (Units: Hours)(Units: Billions of yen)

About the Iyogin Group

Balance of Deposits, etc. (Bank Nonconsolidated)

6.9

4.2
Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023
(Target)Jan.-Dec. 2015 Jan.-Dec. 2020 Jan.-Dec. 2021 Jan.-Dec. 2022 Jan.-Dec. 2023
(Target)March 2016 March 2021 March 2022 March 2023 March 2024
(Target)The female manager ratio is steadily increasing asa result of initiatives to promote women’s
participation, including active support forwork-life balance and career building.

Against the backdrop of deepening relations withcustomers, balance of deposits, etc. continued toincrease steadily, increasing by ¥169.1 billion(2.5%) year-on-year.

As a result of efforts to increase the balance of loans
mainly in the Setouchi region, which is the base of
the Company, the balance of loans increased steadilyby ¥257.2 billion (5.1%) year-on-year.

Although interest and dividend income increased
due to the strengthening of loan initiatives,consolidated core business gross profit declined year
on year mainly due to the recording of hedge costs
using derivatives, but it remains at a high level.

Due to an increase in remote training, the amount invested
and the hours of training per employee are decreasing.
However, we continue to actively invest in human resource
development based on the belief that there is no excessive
investment in human resource development.

Due to the ongoing implementation of the “Smart
Working Challenge,” an initiative for work stylereforms, the overtime working hours under Labor
Standards Act has been reduced.

Profit Attributable to Owners of
ParentConsolidated Core OHR

Consolidated ROE (shareholders’ equity basis)

Independent Outside Directors Ratio

Number of Students who Attended Financial Education Class CO2 Emissions Reduction Rate

(Units: %)(Units: %)Number of attendees (cumulative)
Number of attendees (single year)

27.8

26.4

5.34
60.19

57.05

58.80

18.0

5.40

15,905

37.5%

3.82

21,662
19,662

17,55812,592

2,104(March 2023)

1,653

6,496

(Units: t, %)Scope 1 emissions
Scope 2 emissions
Reduction rate compared to fiscal 2013 (combining Scope 1 and Scope 2)

7,355
-42

2,000

1,410

8,966
8,316
-29
-34

6,296
-50

7,700

7,003

1,337

1,266

1,313

Fiscal 2021

Fiscal 2022

Profit attributable to owners of parent reached arecord high on a consolidated basis. This was due
to an increase in profit as a result of a decrease incredit costs, along with having secured a highlevel of core business gross profit.

Fiscal 2020

Fiscal 2021

Fiscal 2022

Consolidated core OHR remained at a low leveland maintained high profitability, although it
increased compared to the previous fiscal year
mainly due to an increase in expenses due toaggressive strategic investments.

Fiscal 2020

Fiscal 2021

Consolidated ROE (on a shareholders’ equity basis)
continued to improve from the previous fiscal year
due to the high level of profit attributable toowners of parent.

14.58

14.32

15.01

14.28

15.00

283.3

299.9

AA

Face-to-face activities gradually returned in fiscal
2022. We received requests from facilities otherthan schools, such as community center activities
and after-school children’s clubs, and the numberof visiting classes is increasing.

We are reducing CO2 emissions by reducing
power consumption through various measurescentered on facilities and the consolidation of
branches.

Number of Business Feasibility Assessments

Number of Cases for BusinessSuccession and M&As Support

Subsidy Amount for Environmental and Cultural Organizations

R&I

A

S&P
—

6,257

6,940

7,800

(Units: Cases)

160

5,393
96

104

R&I

312

298

323
69

60

65

195

238

247

254

March 2016

March 2021

March 2022

March 2023

232

97

Iyo Bank

JCR(Units: Millions of yen) Cumulative
CulturalEnvironmental

Sustainability

14.65

332.4

The ratio of independent directors among thedirectors is high at 37.5%, ensuring managementtransparency.

(Units: Assessments)
Number of assessments (cumulative)

Iyogin Holdings

JCR

Fiscal 2013 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2030
(Target)Fiscal 2022

Consolidated Gross Equity Ratio andConsolidated Evaluation Gain on Securities Credit Ratings
Consolidated Common Stock Tier 1 Ratio (Units: Billions of yen)
Consolidated Gross Equity Ratio
Consolidated common stock Tier 1 ratio(Units: %)March 2016 March 2021 March 2022 March 2023 March 2024
(Target)Business Strategy and Plan for Realizing
the Long-Term Vision

6,018

1,003

Fiscal 2020

Value Creation Story(Units: Persons)(Units: Billions of yen)

37

S&P
15

AA
Fiscal 2020

Fiscal 2021

Fiscal 2022

9

Iyogin Holdings Integrated Report 2023

Fiscal 2021

A+

A-

Fiscal 2022

Despite the continued high volatility of the market
environment, including rising interest rates in the UnitedStates, we continued to maintain consolidated evaluation
gain on securities at a top-class level among regionalbanks through operations that capture market trends.

Iyogin Holdings and Iyo bank have been highly
evaluated for their safety and credibility, including
the acquisition of AA from Japan Credit Rating
Agency (JCR).

March 2017 March 2021 March 2022 March 2023 March 2024
(Target)Fiscal 2015

Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2023
(Target)Business feasibility assessments have spread
extensively mainly among major customers. By
conducting business feasibility assessments,
we are able to deepen our understanding ofcustomers and identify and delve into issues.

We have established a one-stop support systemcovering reorganization, shifting to a holding
company, and M&A support due to lack ofsuccessors, and provide support for approximately
100 cases per year.

By subsidizing a portion of the activity costs fororganizations conducting environmental
conservation activities and cultural activities,
we are working to protect the environment andpass on regional culture.

Iyogin Holdings Integrated Report 2023

Corporate Data

Consolidated Gross Equity Ratio and Consolidated Common
Stock Tier 1 Ratio increased from the previous fiscal year. Thiswas due to the enhancement of equity by accumulating profits,
the improvement of business conditions of our customers, andthe control of risk-weighted assets through portfolio control.

Fiscal 202010

Message from the Management

Corporate Data

Iyogin Holdings Integrated Report 2023

Sustainability

Iyogin Holdings Integrated Report 2023

Business Strategy and Plan for Realizing
the Long-Term Vision

11

Value Creation Story

Iyogin Holdings

Kenji Miyoshi Representative Director and President

Message from the Management

The environment surrounding the Group is undergoing major changes, suchas supply chain disruptions due to the emergence of geopolitical risks,soaring energy and raw material prices, the depreciation of the yen, andpressure on corporate earnings and household budgets due to rising prices.
On the other hand, the impact of the COVID-19 pandemic, which has beenongoing since 2020, is gradually diminishing. In Ehime Prefecture, which isthe base of the Group’s business, we are beginning to see signs of recovery
in demand, mainly in the tourism and shipbuilding industries.
In such a rapidly changing environment, we transitioned to a holding
company structure in October last year and launched “Iyogin Holdings,”
thereby reaching a turning point in our history. Behind the transition was awhole array of factors, including prolongation of the low interest rate
policy; economic structural changes such as changes in consumer behavior
and population decline; advances in digital technology; and thediversification and sophistication of customer needs. In order to respond
appropriately to these changes, we chose to become a holding company
because we believe it is necessary to move away from the traditional bankcentered organizational structure and culture, and enable each Group
company, including the Iyo Bank, to operate autonomously and flexibly.
The decision to transition to a holding company was a major one thattook into consideration the past ten years and the next ten years.
Looking ahead, in order to continue to grow, the Group will always
remember to adopt a customer-oriented approach and actively take onchallenges in new fields without fear of failure or change.

About the Iyogin GroupTo all stakeholders:

Striving to provide diverse
services and value

Management Commitment

12

Message from the Management

Management Commitment

The Iyogin Business Service

Administrative outsourcing services

Iyogin Challenge & Smile

Administrative outsourcing services (special subsidiary company)

4 affiliated companies

Management business of investment fund, etc. (3 companies) Support services for branding and market development*

The Iyogin Credit Guaranty
Iyogin Capital

Credit guarantee business
Investment business

7 consolidated subsidiaries

Venture funding

2 non-consolidated subsidiaries

Venture funding
Financial and economic research operations Management consultation service

Iyogin Digital Solutions

Consulting service, and development, sales and maintenance business of applications

Credit card businessLeasing business
Computer-related business
Financial instruments businessCorporate Data

Iyogin Regional Economy Research Center
Iyogin DC Card
Iyogin Leasing
Iyogin Computer Service
Shikoku Alliance Securities

The industrial structure of Ehime Prefecture, where the Groupis based, consists of a well-balanced portfolio ranging fromthe primary industry to the tertiary industry.
The Nanyo region has a thriving primary industry and is oneof the leading citrus fruit production areas in Japan. Its sea
culture industry also boasts one of the highest production
volumes in Japan for products such as sea bream, yellowtail,and pearls. The Toyo region is at the center of the secondary
industry in the prefecture, boasting shipbuilding, paper andpulp industries, chemicals and general machinery. A variety ofindustrial cities are closely situated in the region, andcollaborations between these industrial clusters have thepotential to increase their international competitiveness andstrengthen the supply chain. The Chuyo region focuses on
tourism, represented by destinations such as Dogo Onsen and
the Matsuyama Castle; commerce, and the service industry.
Furthermore, also located in the area are factories of large
manufacturers, as well as large companies that enjoy highshares in small once-through steam boilers, farm machinery,and dried bonito shavings. The vitality of these local industries
is a source of the Group’s strength.
In addition, the Group has been building up an operatingbase that can contribute to the industrial development of the
Setouchi region, mainly in Ehime Prefecture. Our domestic
sales offices are spread over a wide area across 13 prefectures,and collectively they form the largest branch network among
the regional banks. We also have bases in three overseas
locations (Singapore, Hong Kong, and Shanghai), and havetherefore established a strong operating base.

For the fiscal year ended March 31, 2023, the consolidated
ordinary revenue of Iyogin Holdings was ¥172,954 million,
consolidated ordinary income was ¥42,415 million, and profit
attributable to owners of parent was ¥27,899 million. As thisis the first settlement of accounts since our transition to aholding company structure, we cannot make a simple
comparison with the previous fiscal year. Nonetheless, ourperformance was robust.
One of the factors supporting our strong businessperformance was ship finance, a distinctive business of theGroup. Imabari is a maritime city in Ehime Prefecture with aconcentration of ship-related companies in the oceantransport, shipbuilding, and ship machinery industries. Since
99.5% of Japan’s imports and exports are conducted using
ships, as a trading nation, ships are indispensable to Japan.
From a global perspective, we consider maritime-relatedindustries to be growth industries as the world population
continues to grow, and we will continue to support such local
industries through appropriate and bold risk-taking.
Market investment is another factor that supported oursolid performance. The Group has traditionally placed greatemphasis on making market investments with a thoroughawareness of the portfolio balance. For instance, in theprevious fiscal year, amid rising interest rates overseas, we
flexibly proceeded with replacement trading that captured themarket trends, thereby securing gains on the sale of bonds
including JBGs while improving the profitability of ourportfolio.
On the other hand, as an revenue-related issue, we believe
there is room for further enhancement in our non-interest
revenue. The Group aims to build a sales structure based on
customer experience value (CX), and to increase non-interest
revenue by properly understanding the needs andSustainability

Iyogin Holdings

Banking business

The region’s diverse industrial structuresand our operating base are our strengths

Ship finance and market investment
contributed to business performance in theprevious fiscal year

Business Strategy and Plan for Realizing
the Long-Term Vision

Iyo Bank

The newly established consulting company mentioned above
was actually born from the idea of a mid-career bank
employee, and we believe that we will continue to see moreof such ambitious initiatives in the future.

Value Creation Story

Structure of the Group

However, when discussing operating bases, besides thewidth of the coverage, the depth is important as well. I believethat services related to deposits and loans are the barometerof trust for us as a regional financial institution. Over our
145-year long history, we have continuously kept importantfunds and provided appropriate financial intermediation,
which allowed us to build deep and strong relationships withthe local community. Even after becoming a holding company,
we will continue to strengthen our relationships withcustomers and deepen the relationships in new fields byfocusing on increasing deposits and loans, which are
traditional banking services.
In addition, in a survey of “financial institutions recognizedas main banks by companies in the Shikoku area” publishedby a credit research company, Iyo Bank’s share was 21.67%,
the only company that exceeded 20% for the second
consecutive year, making it the top bank in the region.
Moreover, our share of deposits in Ehime Prefecture exceeds
50%, which shows the overwhelming support that we receivefrom local residents.

Message from the Management

The Iyo Bank Group consists of a group of companies that
operate a range of businesses in addition to the core banking
business. These include operations related to securities, leases,
guarantees, credit, venture capital, system development, thinktank, and consulting. As we transitioned to a holding company
structure in October last year, we believe that this enabled thehorizontal alignment of the main operating companies,
thereby forming a structure that facilitates the creation ofgroup synergies. Taking this opportunity, we will further
accelerate integrated group management and further enhancethe expertise of each company, so as to meet the diverse
needs of local customers in the region.
Regarding the purpose of the transition to a holding company
structure, there are three main objectives: “expansion ofbusiness fields in light of relaxation of regulations,” “enhanced
group governance by strengthening business management
functions,” and “maximizing group synergies by changing
employee and officer awareness and behavior.”
First, let me explain how we aim for the expansion of ourbusiness fields in light of the relaxation of regulations.
Taking full advantage of the relaxation of regulations due tothe revision of the Banking Act, we will strengthen ourconsulting services to solve emerging issues such as population
decline and the need to improve productivity, as well as workon projects that contribute to regional sustainability, in orderto improve our problem solving and earnings power.
Accordingly, in April of this year, we established “Iyogin Digital
Solutions” as a consulting company that utilizes digitaltechnology. It is a new company that provides support for
digital transformation (DX), which is a management issue thatmany of our customers of SMEs struggle with. Throughconsulting proposals that utilize digital technology, Iyogin
Digital Solutions will work to solve customers’ problems, whileaiming to create profit opportunities in non-financial fields.

Next, we also strive to enhance group governance bystrengthening our business management functions. Our coresubsidiary Iyo Bank became the first regional bank toannounce its transition to a company with an Audit andSupervisory Committee in 2015, aiming for its separation of
the execution and supervision functions. Therefore, as aGroup, we have already been working on strengthening
governance and speeding up decision-making.
With the transition to a holding company structure, theholding company will now manage and supervise the Group
companies, including the bank, and optimize the allocation ofmanagement resources, such as human resources. Therefore,
we have established a system that allows each Group
company to focus more on its own operations. Going forward,
we aim to further strengthen our business management
functions as a Group.
Finally, we aim to maximize group synergies by changing
employee and officer awareness and behavior. Up until now,
Iyo Bank has often been the starting point for activities thatprovide value to customers, such as consulting services or theoffering of solutions, and the independence of the Group
companies has not necessarily been prioritized. Since Iyo Bankis the core company of the Group, it will continue to function
as a hub for the Group companies in the future. However, inorder to improve our ability to provide comprehensive value,
we believe it is important for us to demonstrate groupsynergies by bringing together knowledge and ideas fromacross the Group.
Therefore, instead of centering their operations around Iyo
Bank like before, going forward, we believe it will be necessaryfor each operating company to take on the challenge ofentering new business fields, and providing support tocustomers who are resolving their issues.
By adopting such a system, we can bring about a change in
the awareness of the employees of each Group company, andcreate an autonomous corporate culture that fosters a senseof ownership, where employees believe “it is the Group’s
responsibility to solve the problems that our customers face.”

About the Iyogin GroupA holding company structure that brings
together the Group’s comprehensive
abilities*Company that engages in special advanced banking services (Trade name: Shikoku Brand)

13

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

14

Message from the Management

Management Commitment

Basis of the Group’s management:
Deepening and evolving the “DHD model”

A corporate group that continues to create andprovide new value

Constantly challenging ourselves to do
betterDesired structure of human resources

A Consulting GroupCo-creative human resources withadvanced expertise(shifting from generalists to T-type personnel)

Specialists by fields(securing -type and I-type personnel)

By putting the right person in the right place or finding the right person for the right place,allow our diverse human resources to fully demonstrate their capabilities
Corporation

Individual

Ship

MarketTechnology

Planning

Risk management

SupportSpecialized fields

Offices

Next medium-term management plan isbased on sustainability“Creating a bright and prosperous future for the region” isthe Group Corporate Credo as well as the meaning ofexistence of the Group. This philosophy has always guided ouractions, and will never change in the future.
On the other hand, the environment surrounding the Groupis changing rapidly and intensely. In order for the Group to

In all aspects of my life, I have always embraced the phrase“sail through unchartered waters valiantly” as my creed. This
creed embodies the spirit of boldly challenging unexplored
fields, overcoming difficulties and trials, and creating a new
future. Even before I became the President of Iyo Bank, I havevalued this creed in my professional life. In addition, I believethat “maintaining the status quo is regressing,” and that weshould take on challenges that are necessary for the future,even if there are no precedents. However, amidst the trend ofgeneral business companies entering the financial industry, asa bank, it is currently difficult to take on new challenges.
Nonetheless, the recent revision of the Banking Act hasrelaxed various regulations, making it easier for us to take on
the challenge of addressing the needs and deficiencies of local
communities.
Going forward, we will continue to provide new value tolocal communities, and strive to return profits to ourshareholders and investors. We sincerely hope that you willcontinue to support the Group in all our future endeavors.

Iyogin Holdings Integrated Report 2023

Corporate Data

Iyogin Holdings Integrated Report 2023

Fiscal 2021 Medium-Term Management Plan: Long-Term Vision

Sustainability

15Group Corporate Credo

Business Strategy and Plan for Realizing
the Long-Term Vision

The DHD model started with a simple concept: “To be thebank with the simplest administrative procedures in Japan.” Its
digital aspects, such as improvements in customer convenienceand reduction in the burden of clerical work, often attract
attention, but the important point is the “H: human” inbetween. In other words, human resources are key. By shifting
the manpower and time created by digitalization to operations
that contribute to strengthening profitability, we wish to refine
our human resource capabilities by “increasing the role thathumans ought to play.”
In particular, we are focusing on using the uniquecapabilities of human employees to make consulting proposals
that aim to solve the problems of each and every customer,
which can include issues related to financing, asset
management, business succession and inheritance measures.
Recently, we have introduced loan systems such as the“Accompaniment Support-Type Special Guarantee System”
for business operators who were affected by the COVID-19
pandemic, and we are actively working with our customers torebuild their management. Furthermore, in response to

As I have mentioned above in “deepening and evolving the‘DHD model,’” humans will play a role that is as important oreven more important than digital technologies. In the humanportion of the model, the question is how much value can we
add.
While human capital management has come under the
spotlight in recent years, the Group has been considering
human resource capabilities as the biggest source ofcompetitiveness edge for years, based on the understandingthat there is no excessive investment in human resource
development. The Group has thus strived to develop humanresources with a high level of expertise and a diverse range ofskills.
In October of last year, we made major revisions to ourpersonnel system for the first time in six years, and introduced
the concept of “career fields” as a mechanism for employees
to grow while further improving their strengths and fields ofexpertise. In a diversifying society, we aim to develop “cocreative human resources with advanced expertise” and“specialists by fields” with more advanced knowledge andskills.

adapt to these changes, continue to meet the expectations oflocal communities and customers, and continue to sustainably
exist as a group, we believe that it is necessary to continue
deepening and evolving our business model.
To that end, we must be aware of the elements that
constitute corporate value. In recent years, there has been ashift from using short-term financial indicators to using
medium- to long-term non-financial indicators, and the rulesof the competition are changing globally. Hence, there is aneed to increase social and economic value by resolving
various local issues. In other words, we believe that our role isto sustainably generate “earning power” not only for us but
also for the region.
Based on this perspective, in the next medium-term
management plan that will begin in fiscal 2024, which will be
our first as a holding company, we would like to make a planthat is more conscious of the Group companies. Also, we
recognize that this fiscal year will be an important one inlaying the groundwork for the plan. Including the concept of“human capital,” we will identify important items(materialities) among various social issues that greatly affectthe value creation of the Group. Moreover, in order to achieveboth the resolution of social issues and the enhancement of
the Group’s earning power, we believe we should formulate amanagement plan based on sustainability.
In addition, we recognize that the recent debate on the PBR
is an important issue. However, based on the basic approaches
that have been described so far, while drawing up a model offuture growth for the region and for ourselves, we will
endeavor to strike an optimal balance between the three
items: maintain a capital buffer for risk-taking activities;
improve ROE through making investments for growth; andprovide appropriate returns to investors. Furthermore, we will
actively communicate with investors.

Value Creation Story

Using digitalization to maximize the valueof human resources

Introduced “career fields” to cultivate
diverse human resources with expertise

In order to shift our policy from the development ofgeneralists to the development of human resources with fields
of expertise, we have established eight subdivided fields:
corporation, individual, ship, market, technology, planning,risk management, and support. We promote “career
autonomy” for our employees. This is where employees
recognize at an early stage which field they want to build theircareer in, and autonomously improve their abilities in the fieldthat they have chosen.
We believe we also need “T-type human resources” whohave excellent abilities in one of the eight fields, “ -typehuman resources” who have two specialties, and “I-typehuman resources” who are super-specialized personnel, whileassuming all of these human resources have various job
experience. Whether we get a T, , or I, developing personnel
in this way will lead to diversity in human resources.
Taking the digital and technology fields as an example,
many regional bank groups jointly operate or outsource theircore systems. In contrast, as the Group has around 240
personnel with system development and operation skills, ourcore system can be run entirely within the Group. This is oneof the Group’s strengths, as there are few other examples ofcompanies that have secured such a large number of humanresources in their group. However, in order to further deepenand evolve the DHD model, it is essential for us to have“digital business personnel” who not only have “digital”
knowledge but also have “business” perspectives. Accordingly,
we will utilize various training programs, short-term traineecourses, OJT, and secondment opportunities to progressively
develop highly skilled human resources.

Message from the Management

The goal of “deepening and evolving the DHD model” is at
the core of our efforts to realize our long-term vision of
becoming “a corporate group that continues to create andprovide new value.” DHD (digital, human, digital) refers to aservice model with three steps. First, we create a mechanism
for seamless contact and continuous connection withcustomers through the use of D (digital touch points). Then,through H (human consulting), we make customer-oriented
proposals with a sense of warmth that is unique to humans.
Finally, through D (digital operations), we can make various
procedures paperless and shorten processing time, so thatprocedures can be completed without the need to visit a store.
This DHD model is not an end, but rather a means to enhance
CX, and is positioned as something to be worked on together
with the “creation of new services and businesses” and“review of existing businesses.” Some of the digital services
we have launched have not produced the results that we hadoriginally envisioned. While it is necessary to make some
upfront investments with an eye to the future, we also needto conduct an examination of our services in detail with a keenawareness of ROI. Going forward, we will continue to repeat
the trial and error process to further deepen and evolve the
DHD model. Moreover, by having the entire Group work as awhole to reform our business model, we will aim forsustainable growth and enhancement of our corporate value.

diversifying inheritance needs, in addition to a rich lineup oflife insurance products, we provide a wide range of services
such as will writing support, civil trusts, and inheritancearrangement services. By implementing personalized
consulting to accommodate our customers’ wishes, we haveachieved a certain level of results, such as a significant increasein the number of contracts.
As a result of promoting this DHD model, there has also
been a reduction in the amount of overtime work. Banks used
to be famous as an industry with a lot of overtime, butdigitalization is allowing us to make steady progress in ourwork style reforms.

About the Iyogin Groupmanagement issues of customers with whom we do business,
which includes transactions of deposits and loans, and byproviding even greater value than before.

16

Message from the Management

SpecialFeatureHuman Capital Management
Developing an environment that improves engagement
In order for our human resources to fully demonstrate their capabilities, it is essential to develop a working environment
where they can work with a high degree of engagement. Therefore, we are actively endeavoring to improve the working
environment by centering on the work style reforms, DE&I (diversity, equity and inclusion), and health management. Throughthese initiatives, we believe we can realize the Well-Being for our employees.

My name is Sugino, and I was appointed as General Managerof the Personnel Planning Division in March 2023.
I would like to share my thoughts with stakeholders bothwithin and outside the Group regarding the human resource
strategies for the Group to continue growing sustainably as“a corporate group that continues to create and provide newvalue.”

Division

Human resources are the source and the core capital of the Group’s competitive advantage. Human capital management,
which has been attracting attention in recent years, is a management style that treats human resources as “capital,” andmaximizes their value to enhance corporate value over the medium to long term. However, in order to maximize the value ofhuman resources, the employees themselves have to be in good condition physically, mentally and socially. In other words,
their well-being is essential. Therefore, we aim to realize the five elements of Well-Being (career, social, financial, physical, andcommunity) for all Group employees by implementing various human resource strategies. Accordingly, we would like to createa virtuous cycle that strengthens human capital and leads to the enhancement of corporate value.

Ratio of Married Female Employees

42.9%

Female Manager Ratio

39.6%

30.9%
12 years
4 months
21.9%
15.9%

17.6%

10 years
2 months
9 years
9 years 7 months
8 years 4 months
8.8%
10 months
5.8%
4.4%
2.3%

13 years
6 months

10 years
11 months
18.6%

12.0%

16.3%
13.7%

Fiscal 2010 Fiscal 2012 Fiscal 2014 Fiscal 2016 Fiscal 2018 Fiscal 2020 Fiscal 2022

From “D&I” to “DE&I”
Up until now, we have been working on D&I with a focus on promoting the women’s participation. However, we would liketo become an organization where each and every one of our diverse employees can have opportunities to take on challenges
according to their individuality, and make full use of those opportunities. Hence, in May 2023, we announced our
Commitment to DE&I to further clarify the concept of “equity.” Going forward, we will develop various DE&I measures basedon the Commitment to DE&I, and the Group will aim to be a company where people can work comfortably, at which people
want to work, and which contributes to creation of the region’s future as growing with it in the region.

Employees’ career autonomy

Iyogin Holdings Integrated Report 2023

In order to create a workplace where each and every employee can fully demonstrate their unique abilities, we arefurther promoting DE&Iand aiming to be a company where people can work comfortably, at which people want towork, and which contributes to the creation of the region’s future as growing with it in the region.

Diversity

We will deepen our mutual understanding by recognizing the diverse range of individual characteristics, such as gender,
age, nationality, presence or absence of disability, SOGIE, life course, health condition, work style, way of life, and way of
thinking.

EquityWe will pursue equity so that each and every employee can have opportunities to take on challenges according to theirindividuality, and make full use of those opportunities.

Inclusion

We will create a workplace that provides a strong sense of emotional safety, where each and every employee can develop
their unique strengths and play an active role.

Iyogin Holdings Integrated Report 2023

Corporate Data

17

Iyogin Group’s Commitment to DE&I
Sustainability

In the financial industry in which we operate, as customer needs have become more diverse and complex, the services
demanded by customers are expanding beyond the boundaries that separate the financial and non-financial sectors, and thelevel of expertise required for each of those services is also rising. Against this backdrop, in October 2022, we revised our
personnel system to develop “co-creative human resources with advanced expertise” and “specialists by fields” throughout
the Group. Accordingly, we believe our top priority to spread this new personnel system throughout the Group and to operate
it appropriately.
In the new personnel system, we have introduced a new concept of “career fields.” One of the objectives of this measure isto drive “career autonomy,” by encouraging employees to autonomously improve their abilities and skills in the fields thatthey have chosen. In order to support employees’ “career autonomy,” we would like to actively invest in human resource
development, such as development of a training system for each career field and an environment where employees can leanautonomously, under the basic principle of “there is no excessive investment in human resource development.” Moreover, we
would like to realize optimal personnel allocation, as putting the right person in the right place or finding the right person for
the right place allows the human resources, which we have developed through the implementation of various training
measures, to fully demonstrate their capabilities. This would also improve the Career Well-Being of our employees.

Business Strategy and Plan for Realizing
the Long-Term Vision

Enhancing corporate value via realization of Well-Being

Average Years of Service of Female Employees

Value Creation Story

Rika Sugino General Manager, the Personnel Planning

In recent years, as a result of proactive efforts to develop an
environment centered on work-life balance support systems, therate of married female employees, which was around 10% about adecade ago, has now risen to more than 40%. In addition, theaverage years of service of female employees, which used to be lessthan 10 years, has increased to over 13 years, proving that we haveestablished an environment that allows for women’s continuous
employment.
Although the female manager ratio has steadily increased
compared to 10 years ago when it was less than 5%, it is still low at
18.6% (as of March 31, 2023). I would like to drive the movement
to the next level and support women in their career development,
thereby promoting “women’s participation” in the original sense of
the phrase.
To that end, I will make the most of the fact that I am a woman
to foster an organizational climate that overcomes unconscious
biases, acknowledges the diverse range of individualities more thanever, and deepens mutual understanding. Accordingly, this enables
the achievement of genuine participation of women, and of DE&I.

Message from the Management

Achieving genuine participation of women

Rika Sugino, General Manager, the Personnel Planning
Division and General Manager, the Wellness Management
Promotion Department (Career Summary)
April 1995
Joined Iyo Bank
January 2008 Took childcare leave
September 2010 Took childcare leave
April 2018
Deputy General Manager, the Corporate Planning
Division, Shikoku Alliance Securities
June 2020
Manager, the Corporate & Retail Banking Planning
Division (currently Business Marketing Division), Iyo Bank
August 2021 Deputy General Manager, the Human Resources Division, Iyo Bank
October 2022 Deputy General Manager, the Personnel Planning
Division, the Company;
Deputy General Manager, the Human Resources Division, Iyo Bank
March 2023
General Manager, the Personnel Planning Division;
General Manager, the Wellness Management Promotion
Department, the Company;
General Manager, the Human Resources Division, Iyo Bank;
General Manager, the Diversity & Inclusion Promotion Department;
General Manager, the Wellness Management Promotion
Department, (current position)

About the Iyogin Group

Message from General Manager,
the Personnel Planning Division18

Message from the Management

Human Capital Management

SpecialFeatureAbout the Iyogin GroupThe Group positions human resources as one of the sources of its competitive
advantage. Accordingly, we are working on human resource development and on
improving the working environment, aiming to realize the five elements of Well-Being(career, social, financial, physical, and community) for all Group employees.

Well-Being at the Iyogin Group

Better work, better life.

Overview of human capital management and KPIs

Investment amount of HR development (per employee
training-related costs)¥189,000¥180,000 or more

Hours of HR development training(per employee training hours)

52.6 hours

50 hours or more

Establishment of an environment which facilitates autonomous learning
Make career paths and skills visualized; create an environment where employees can learn
at any time, anywhere

Number of employees assigned through in-house
recruitment system

13

15 or more

Holders of Information Technology Passport

674

750 or more

Number of mid-career hires

12

15 or more

Holders of advanced qualifications

540

570 or more

Overtime work hours

4.2 hours

5 hours or less

Paid leave utilization rate

79.6%

75% or more

Engagement score (wevox)

70

72 or more

Utilization rate of corporation DC

77.5%

80% or more

Female manager ratio

18.6%

20% or more

Average years of service of female employees

13 years 6 months

15 years or more

Acquisition rate of childcare leave, etc. of men

139.0%

100% or more

Employment rate of persons with disabilities

2.28%

2.3% or more

Physical indicator (obesity, blood pressure, blood lipid
level, and blood sugar level)

35.8%

35% or lessEmotional indicator (stress checks)

81

75 or lessHealthmanagement

Employment indicator (absenteeism)

1.8 days

1.5 days or less

Employment indicator (presenteeism)21%

15% or less

Develop personnel for the corporation/individual/ship/planning fields
Develop of market personnel
Develop technology personnel
Develop of planning (digital business) personnel

Arranging an environment where autonomous and diverse ways of working are
possible
Initiative for work style reforms “Smart Working Challenge”
Arranging a workplace environment providing “motivation” and “job satisfaction” (increasing engagement)
Raise base and starting salaries (implemented in April 2023)
Arranging the environment where everybody can actively work regardless of age,gender, etc.
Personnel system under which highly individualistic talents can be fully utilized
Actively promoting women’s participation
Encourage men to participate in child rearing; develop a comprehensive work-life balance
support system

Population approach
Lend out wearable terminals; subsidize costs for medical examination
High-risk approach
Obligate employees at 40 years old or over to undergo medical examination; provide
health guidance using the health management system

Outcome

Career
Well-Being

Social
Well-Being

Financial
Well-Being

PhysicalWell-Being

Sustainability

Arranging the internal environment

DE&I

Targets for Fiscal
2023

Business Strategy and Plan for Realizing
the Long-Term Vision

Work style reforms

Fiscal 2022 Results

Development of human resources with fields of expertise
Develop a personnel system that cultivates strengths; understand each employee’s aptitude
and enhance their experience

Response to diversification of careers
Reform training programs (increase level of freedom and options); strengthen
implementation of career interviews

Specialists
by fields

KPI

Value Creation Story

Human resource development

Co-creative humanresources withadvanced
expertise

Main Measures

Message from the Management

Input

Community
Well-Being

Corporate Data

19

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

20

Message from the Management

Human Capital Management

SpecialFeatureUnder a basic idea of “originating from customers,” we are working on human resource developmentwith the aim of becoming a consulting group that can create and offer diverse types of value. This isdone by putting the right person in the right place or finding the right person for the right place andallowing “co-creative human resources with advanced expertise” and “specialists by fields” to create
their strengths, improve their area of expertise, and fully demonstrate their capabilities.
CareerCo-creative human resources with advanced expertise (Improving base skills)

Additional notes

TargetFiscal 2019 Results Fiscal 2020 Results Fiscal 2021 Results Fiscal 2022 Results

Investment amount of HR development Per employee training-related costs*¥180,000¥227,000¥174,000¥200,000¥189,000

Hours of HR development training Per employee training hours*

1

47.2 hours

46.3 hours

56.1 hours

52.6 hours

15

15

22

18

13

Holders of Information Technology Passport

750

276

420

540

Targets for Fiscal 2023 Fiscal 2019 Results Fiscal 2020 Results Fiscal 2021 Results Fiscal 2022 Results

Match rate with wishes of career fields*——

Target95.3%

190% or more

Number of participants in short-term
trainee training*2

50 or more

15

23

37

50

Number of participants of in-house training

3,000 or more

2,565

2,223

3,069

2,843

Number of employees dispatched forexternal training (short-term)
Number of employees dispatched forexternal training (long-term/secondment)

100 or more

83

21

77

98

15 or more

19

15

21

14

Digital business personnel (starters)*3

136 or more

—

—

24

80

Fiscal 2019 Results Fiscal 2020 Results Fiscal 2021 Results Fiscal 2022 Results

15

23

14

12

12

570

416

466

504

540

*Attorneys, Certified Public Accountants, Certified Public Tax Accountants, judicial scriveners, Real Estate Appraisers, MBAs, Small and Medium-sizedEnterprise Consultants, land and building investigators, 1st grade Certified Skilled Professionals of Financial Planning, CFPs, 1st grade Official Business
Skill Test in Bookkeeping, 1st and 2nd grade Medical Management Specialists, senior PBs, customs specialists, International Business Advisers certified
by AIBA, Labor and Social Security Attorneys, 1st grade Certified Care Welfare Management Specialists, advanced agricultural management advisors,
patent attorneys, TOEIC score of 700 or higher, Test in Practical English Proficiency Grade Pre-1 or higher, Level 1 Chinese Proficiency Test, 1st-classarchitects, securities analysts, Certified International Investment Analysts, Information Technology Strategists, System Architects, Project Managers,
Network Specialists, Database Specialists, Embedded Systems Specialists, Information Technology Service Managers, Systems Auditors, Registered
Information Security Specialists, Japan Statistical Society Certificate Grade 1, 1st grade Certified Skilled Workers of Web Design, Internal Financial
Auditors, and Certified Internal Auditors (CIAs)

Items to be Assessed

Specialists by fields(Improving special
skills)Targets for Fiscal 2023 Fiscal 2019 Results Fiscal 2020 Results Fiscal 2021 Results Fiscal 2022 Results

Digital business personnel(Operating Personnel)*1

—

—

—

—

40

Holders of advanced qualifications

570

416

466

504

540

Of which, personnel for corporation/individual/ship/planning*2

—

330

377

409

434

Of which, market personnel*3

—

70

74

79

83

Of which, technology/planning(digital business) personnel*4

—

16

15

16

23

*1 Total number of participants in the “Digital Business Practical Training”*2 Number of employee with “advanced qualifications” of Attorneys, Certified Public Accountants, Certified Public Tax Accountants, judicial
scriveners, Real Estate Appraisers, MBAs, Small and Medium-sized Enterprise Consultants, land and building investigators, 1st grade Certified
Skilled Professionals of Financial Planning, CFPs, 1st grade Official Business Skill Test in Bookkeeping, 1st and 2nd grade Medical Management
Specialists, senior PBs, customs specialists, International Business Advisers certified by AIBA, Labor and Social Security Attorneys, 1st grade
Certified Care Welfare Management Specialists, advanced agricultural management advisors, patent attorneys, TOEIC score of 700 or higher, Test
in Practical English Proficiency Grade Pre-1 or higher, Level 1 Chinese Proficiency Test, 1st-class architects, Internal Financial Auditors, and Certified
Internal Auditors (CIAs)*3 Number of employees with “advanced qualifications” of securities analysts and Certified International Investment Analysts*4 Number of employees with “advanced qualifications” of Information Technology Strategists, System Architects, Project Managers, Network
Specialists, Database Specialists, Embedded Systems Specialists, Information Technology Service Managers, Systems Auditors, Registered
Information Security Specialists, Japan Statistical Society Certificate Grade 1, and 1st grade Certified Skilled Workers of Web Design

Sustainability

Co-creative humanresources withadvanced expertise(Improving base skills)—

Additional notes
Number of mid-career hires for the entire Group(including re-employment and appointment)
Number of employees with qualifications forwhich points are added in promotion reviews*

674*1 Only applicable to employees of Iyo Bank (non-consolidated)
Venue costs for training sessions (including utility costs and maintenance costs), external lecturer costs, teaching materials costs, costs for dispatching toexternal institutions, system costs related to training, incentives for acquiring official qualifications, travel costs for training, tuition fees, amountequivalent to personnel expenses for training participants, amount equivalent to personnel expenses for employees seconded for training purposes, etc.
(excluding voluntary participation in holiday seminars and study sessions organized by each department)*2 Only applicable to employees of Iyo Bank (non-consolidated)
Including hours taken by employees seconded for training purposes (excluding voluntary participation in holiday seminars and study sessions organizedby each department, and training and seminars voluntarily attended by employees)

Items to be Assessed

KPI
Number of midcareer hires
Holders of advanced
qualifications

Business Strategy and Plan for Realizing
the Long-Term Vision

50 hours

Number of employees assigned
through in-house recruitment system2

As for “special skills,” we have classified areas and personnel that require advanced specialized knowledge and skills into four
fields: “corporation/individual/ship/planning,” “market,” “technology,” and “planning (digital business).” We are conducting
various measures in each of the fields.
We aim to improve special skills by conducting training centered on specialized divisions at the headquarters, anddispatching personnel to specialized institutions, including those outside the Group. Furthermore, we establish the “advanced
qualifications” for each field, and promote autonomous learning and the acquisition of qualifications by employees.
Accordingly, we can develop human resources who can provide more advanced and diverse value to customers.
Furthermore, utilizing the “professional course” newly established in the revision of the personnel system in October 2022,
we will promote the appointment of human resources with even more specialized knowledge and experience, in fields otherthan banking. We also plan to actively engage in mid-career hiring of personnel from the outside.

Value Creation Story

KPI

CareerSpecialists by fields (Improving special skills)

Message from the Management

Base skills range from common sense, morals, and general manners to business skills and finance and IT literacy. They also
include basic knowledge and skills about corporate and individual operations required for a wide range of employees. We
expect all employees to identify and develop their strengths and improve base skills to collectively form a group of consultants.
To that end, we are promoting various measures in line with the revision of the personnel system and in cooperation withspecialized divisions, centered around these main pillars: (1) personnel with an area of expertise; (2) establishment of anenvironment which facilitates autonomous learning; and (3) response to diversification of careers.
When we revised our personnel system in October 2022, in order to encourage greater autonomy in employees’ cultivationof their fields of expertise and improvement of their specialized skills, we established eight career fields: corporation,individual, ship, market, technology, planning, risk management, and support. In addition, we support the further growth of
employees through initiatives including: expansion of various training systems that provide a variety of challenges andopportunities for new experiences; provision of diverse learning methods, including online ones, and expansion of methods
for self-development; and the external dispatching of employees.

About the Iyogin Group

Basic Policy on Human Resource Development*1 Match rate between “(a) career field of duties that employees are currently performing” and “(b) those of duties that they wish to do (including theirsecond choice)” (=(b)/(a))*2 Number of participants in short-term trainee training (Funds Operation & Securities Division, International Division, Corporate Consulting Division, digital
personnel (ICT Strategy Planning Department, Business Marketing Division, Personal Consulting Division), Ship Finance Division, Systems Development
Division, Regional Vitalization Division, Shikoku Alliance Securities) by year
*3 Total number of participants in the “Digital Business Basic Training” and the “Digital Business Short-term Trainee Training”

Corporate Data

Our efforts in human resource development are also posted on our website. (available in Japanese only)
https://www.iyogin-hd.co.jp/sustainability/human-capital/employee-development/

21

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

22

Message from the Management

SpecialFeatureHuman Capital Management
Actively promoting women’s participation

We are working to arrange the internal environment so that “diverse human resources withexpertise” can work with a high level of engagement. Our initiatives center on “work style reforms,”“DE&I (diversity, equity and inclusion)” and “health management.”

Work Style Reforms

Community

PhysicalArranging an environment where autonomous and diverse ways of working are possible
Overtime work hours
Paid leave utilization rate

79.6%

65.2%

69.6%

6.6
hours

4.2
hours

4.2
hours

Fiscal 2018

Fiscal 2020

Fiscal 2022

Realization of Financial Well-Being for employees
In order to support the realization of the Financial Well-Being of ouremployees, who are the source of our value creation, the Group is also
strengthening efforts to support employees’ asset formation, byenhancing our benefit plans such as defined contribution pension plans(DC), defined benefit pension plans (DB), and stock ownership plans..
In April 2023, in light of the current social circumstances, including
rising prices, we raised the base salary for the first time in 28 years since1995. In conjunction with this raise, we also raised the starting salary.

<<DE&I (Diversity, Equity, and Inclusion)>>Engagement score (Total)
The Group
Financial industry average

71

70

70
68

March 2021

March 2022

DC utilization rate
(investment trust allocation rate)
Nationwide average

75.8％

77.2％

March 2023

Financial
77.5％

March 2021

53.4％
March 2022

CareerIyogin Holdings Integrated Report 2023

13 years
6 months

March 2019

March 2021

March 2023

Physical

The corporate sustainable growth is supported by employees. With such recognition, in addition to initiatives to maintain andimprove employees’ mental and physical health, we also strive to increase employees’ awareness of health, and proactively
support their voluntary activities for health. We are taking both of a “population approach” and “high-risk approach” forhealth management. For the “population approach,” we lend out wearable terminals that all employees can borrow,subsidize costs for medical examination, and arrange a workplace environment where employees can work comfortably. For
the “high-risk approach,” we obligate employees at 40 years old or over to take medical examination, provide healthguidance, etc. using the health management system. With such efforts, we are working to improve absenteeism andpresenteeism. Through these efforts, Iyo Bank has been certified as one of the top 500 enterprises (White 500) in the “2023
Certified Health & Productivity Management Outstanding Organizations Recognition Program.”

Improvement inlifestyle habits

Improving
participation
rates of various
checkups

Prevention ofoccupational
accidents

Targets for Fiscal 2023 Fiscal 2019 Results Fiscal 2020 Results Fiscal 2021 Results Fiscal 2022 Results

Sleep

24% or less

27.1%

23.4%

24.3%

23.6%

Meals

15% or less

14.6%

15.5%

16.9%

17.7%

Regular exercise

73% or less

76.0%

76.6%

75.3%

74.9%

Drinking

3% or less

3.3%

3.5%

3.1%

3.3%

Health guidance implementation rate

95% or more

100%

100%

95.0%

98.2%

Specific health guidance implementation rate

36% or more

30.0%

31.4%

35.2%

35.5%

Rate of participation in walking events

20% or more

—

22.2%

17.5%

14.6%

Participation rate of periodic health checkups

100%

100%

100%

100%

100%

Participation rate of medical examination

70% or more

53.6%

62.3%

65.8%

70.0%

Participation rate of detailed examinations

85% or more

89.0%

80.6%

79.3%

78.4%

Response rate of stress checks

96% or more

94.6%

94.0%

94.7%

95.4%

Ratio of high-stress individuals

4% or less

—

5.4%

5.1%

5.6%

Response rate of wevox

80% or more

—

—

65.1%

70.7%

Ratio of wevox responses viewed by supervisors

50% or more

—

—

49.2%

53.7%

Number of employees who worked overtime for more than 70 hours

20 or less

21

34

18

23

Health and face-to-face guidance implementation rate

100%

100%

100%

100%

100%
Corporate Data23

12 years
4 months

Sustainability

In October 2022, we revised our personnel system to respect the diverse values of our employees, and to allow employees tofully demonstrate their unique capabilities.
Integrated generalist career track and specified generalist
Raised the re-employment age limit of senior employees
career track into new generalist career trackfrom 65 to 70 years of age
Arranging an environment in which employees can playOffering a purpose in life and job satisfaction to seniors,
an active role regardless of their career track, gender,and creating more opportunities for them to play an
etc.
active role
Allowed the employees of the new generalist career track
Reviewed the re-employment system for resigned
to decide whether to transfer
employees; abolished requirements for period of separation
Creating a system that makes it easy to balance workfrom employment, etc.; and made it possible to returnand family without hindering one’s career
directly as the bank’s employees
Introduced a referral recruitment system in order tosecure diverse recruitment measures

10 years
11 months<<Health Management>>

SocialArranging the environment where everybody can actively work regardless of age, gender, etc.

18.6%

16.3%

Iyogin Challenge & Smile Co., Ltd. has been established as a special subsidiarycompany with the purpose of promoting employment of persons withdisabilities. It engages in various initiatives aiming to create a workplace where
they can work actively along with the local community, including developmentof goods, sales of goods at rest stops, event venues, etc. in cooperation withlocal companies, and succession of traditional industries.

55.1％
March 2023

13.7%

Promoting employment of persons with disabilities

Items to be Assessed

53.4％

Female manager ratio

Business Strategy and Plan for Realizing
the Long-Term Vision

In addition, improving employee engagement is also important for
improving CX, which the entire Group is working on together as a whole.
Iyo Bank conducts an engagement survey for all employees every monthusing the engagement detection tool “wevox,” in order to visualize andanalyze each workplace’s state of engagement. Based on the results, wequickly implement the PDCA cycle to improve engagement, and we believethat such efforts will lead to enhancement of organizational abilities andan improvement in business results.

Average years of service of female employees

Value Creation Story

Arranging a workplace environment providing “motivation” and “job satisfaction”

More than half of the Group’s officers and employees are female, and we areworking to promote women’s participation as a major pillar of our DE&I
promotion. We believe it is important to encourage men’s active participation inchild rearing in order to be a company where women can work comfortably.
Therefore, we encourage male employees to take the childcare leave, and haveachieved 100% of the childcare leave utilization rate for men and women since
fiscal 2016. Also, in order to support women’s continuous employment andcareer building, we established a day-care center for children on a premise,“Iyogin Kid’s’ Land.” As corporate social responsibility, we will develop an
environment where children who will be responsible for the next generation cangrow up healthily, and support employees who raise children while working.
With these efforts, the Iyo Bank has obtained the “Eruboshi Certification (threestars),” a certification mark of excellence based on the Act on the Promotion of
Women’s Active Engagement in Professional Life, and the “Platinum Kurumin
Certification” based on the Act on Advancement of Measures to Support Raising
Next-Generation Children.

Message from the Management

As part of the company-wide initiative for work style reforms “Smart
Working Challenge,” we are striving for the management reforms, thechanges in mindset, the operational reforms, and the ability development.
In addition, we are also working to maximize the output (added value) byincreasing the engagement of each employee. To do so, we are striving toarrange a workplace environment in which employees “can work
comfortably” and “can get job satisfaction,” by introducing various
systems to promote autonomous and diverse work styles, such as the“complete flexible working hour system,” the “telecommuting system,”“business casual attire” and the “side job system.”

About the Iyogin Group

Basic Policy on Arranging the Internal Environment

Our efforts to arrange the internal environment are also posted on our website. (available inJapanese only)
https://www.iyogin-hd.co.jp/sustainability/human-capital/work-environment/

Iyogin Holdings Integrated Report 2023

24

Message from the Management

Message from Officer in charge of FinanceCapital Policy and Shareholder Returns
About the Iyogin Group
Message from the Management

In terms of capital policy, as a corporate group that supports the local economy, we will focus on risk management and capital
accumulation to maintain substantial soundness, and work to strengthen returns in order to maximize long-term shareholder returns.
From the perspective of ensuring soundness, while the Group’s distinctive portfolios in ship finance, securities management andsuch allow for high profitability, they are also greatly influenced by the market environment. Therefore, it is important for the Groupto be able to maintain a certain level of equity even when these portfolios are stressed. Hence, we conduct stress tests with aforward-looking perspective on these portfolios, and calculate the required capital level that the Group should secure. As a result, wehave set a goal of stably maintaining the consolidated common stock Tier 1 ratio at 15%.
Regarding shareholder returns, our basic policy is to maintain a stable dividend while striving to enhance equity within the capitalbalance. In particular, in order to maximally meet our shareholders’ expectations, we increased the dividend for fiscal 2022, which
included a commemorative dividend for our transition into a holding company, by ¥1 from the previous year to ¥17 per share(including an interim dividend of ¥8). In addition, we decided to purchase treasury stock in May 2022 with ¥3.0 billion and in
February 2023 with ¥4.0 billion, as the upper limit of the purchase price.

Past amount of dividends and shareholder returns (Billions of yen)
9.3
Dividends

Purchase of treasury stock

8.1
4.0
3.0

Value Creation Story

5.2
2.0
2.9

2.6

3.2

3.8

3.2

3.8

4.4

3.8

4.4

4.4

4.4

5.3

5.1

6.2

March 2011 March 2012 March 2013 March 2014 March 2015 March 2016 March 2017 March 2018 March 2019 March 2020 March 2021 March 2022 March 2023 March 2024
(Plan)

Hiroshi Nagata
Senior Managing Executive Officer(Representative Director)

Progress of Fiscal 2021 Medium-Term Management Plan

Items

Fiscal 2021 Results

Fiscal 2022 Results

Targets for Fiscal 2023

Consolidated core business gross profit¥90.4 billion¥89.5 billion¥86.0 billion

Profit attributable to owners of parent¥26.4 billion¥27.8 billion¥23.0 billion

5.34%

5.40%

4.0% or more

Consolidated core OHR

57.05%

58.80%

Approx. 60.0%

Consolidated common stock Tier 1 ratio

14.28%

15.00%

Approx. 15.0%¥8.4 billion¥8.2 billion¥9.0 billion

Core business gross profit of Group companies (excluding the Bank)*Core business gross profit of Group companies (excluding the Bank): Total core business gross profit of Group companies excluding the Bank before inter-group elimination

25

Iyogin Holdings Integrated Report 2023

97.7

95.0
90.0

Number of stocks
95.0
91.5

26.7

Actual reduction in fiscal 2022

26.1

22.7

80.0

87.2

25.0

85.2
81.3

21.4

75.0

20.0

20.1

18.7

70.0
0

73.7
15.7

March 2016

March 2017

March 2018

(%)
30.0

Reduced book value ¥7.6 billion
88.7

24.4

85.0

Tier 1 ratio* (right axis)

20

March 2019

March 2020

March 2021

March 2022

March 2023

15.0

Corporate Data

Consolidated ROE (shareholders’ equity basis)

Changes in the Book Value of Cross-Shareholdings (Listed)(Billions of yen)
100.0

Sustainability

Regarding the major numerical targets set forth in the Fiscal 2021 Medium-Term Management Plan, in fiscal 2022, we continued tosecure high levels of profit, with consolidated core business gross profit at ¥89.5 billion, owing to an increase in interest and dividend
income as a result of an increase in the balance of loans centered on the Setouchi region, which is the foundation of the Group’s
operations. In addition to securing a high level of core business gross profit, we were able to post a record profit of ¥27.8 billion for
profit attributable to owners of parent, mainly due to a decrease in credit costs. As a result, consolidated ROE on a shareholders’equity basis was 5.4% and consolidated core OHR was 58.8%, and both were at favorable levels.
Furthermore, the consolidated common stock Tier 1 ratio was 15%, an increase compared to the previous fiscal year. The increase
was due to our continuous accumulation of capital, improvement in the business conditions of our customers, and the control ofrisk-weighted assets through portfolio control. The core business gross profit of Group companies amounted to ¥8.2 billion, which isa decrease compared to the previous fiscal year. This was due to a significant reduction in sales, as a result of a review of sales
standards for structured bonds in the securities division. Nonetheless, we are striving to achieve the targets of the plan in fiscal 2023
by maximizing group synergies through our transition to a holding company structure, and by strengthening the consulting
capabilities of the Group as a whole.

When the Group holds stocks for policy purposes, such as maintaining or strengthening business relationships or cooperative
relationships with other companies, the Group fully analyzes the balance of risks and returns, and strives for appropriate
management of investments.
Regarding cross-shareholdings, we verify the rationality of holding stocks from the “investment aspect” and the “policy aspect.”
Regarding the “investment aspect,” we evaluate whether RORA calculated from stocks and deposit and loan transactions, etc.
matches the cost of shareholders’ equity, etc. based on the CAPM and dividend growth model. Regarding the “policy aspect,” weevaluate whether the goal of increasing transactions has been achieved, in the way that was expected at the time of implementation.
At least once a year, Iyo Bank, our core subsidiary, submits the verification results of the rationality of holding each company’s
stocks to the Board of Directors for deliberation (most recent submission: May 2023). When there is little rationality for holding
certain stocks, we will conduct negotiations to improve transactional conditions, etc. If there is no improvement, we will proceedwith the sale of the cross-shareholdings after obtaining the full understanding of the business partner.

Business Strategy and Plan for Realizing
the Long-Term Vision

Policy on Cross-Shareholdings0March 2024
(Plan)*Tier 1 excludes components of comprehensive income

Iyogin Holdings Integrated Report 2023

26

Value Creation Story

Ideal State in the Long Term (Long-Term Vision)
Future Vision Following the Long-Term Vision

The GroupLong-Term Vision: A corporate group that continues to create andprovide new value
Purposes of the transition to a holding
company structure
Expansion ofbusiness fields inlight of therelaxation ofregulations

Strengthening consultation capabilities by theentire GroupImproving cooperation with other industries toexpand our business fields

Enhanced group
governance bystrengthening
business management
functionsAggressively try business fields having highMaximizing group synergies by changing
employee and officer awareness and behavior

affinity with the core business and leading tosolutions for issues in society and customers

Iyo Bank Group
Fiscal 2021 Medium-Term
Management PlanI mprovement incooperation with otherindustries with highaffinity with core businessA bank on your palm
Connecting with employees via
video chatBank employees serving as the Bank at acustomer siteCounters where no pens are used
 ew card loan service
Nthat issues notifications
on insufficient amounts

For bringing “better choice”
to each and every customer

 ouse purchasingH
plan with asmartphone

Businesses ofother industries

Creation of new services and new businesses

Group Medium-Term Management Plan

Creating a bright and prosperous future for the region
Management Stance Offering the best service and being worthy of people’s trust
Code of Conduct
Rendering our best service with gratitude in our hearts
Meaning of Existence

Deepening andevolving the DHD Improvementin customer
model = “DX”
experience
Change in company culture(fixed thinking)value (CX)The Group

Trust
BranchOffices

Iyo Bank Customers
Group
Individuals

Sustainability

Group
Corporate
Credo

Future Vision

Aiming to become aleading corporate groupin the Chugoku andShikoku regions

Business Strategy and Plan for Realizing
the Long-Term VisionCorporate group

Fiscal 2021 Medium-Term Management Plan
Group Medium-Term Management Plan

Value Creation Story

Continuing to create andprovide new value

The Group is continuing the construction of the “DHD model,” which utilizes digital technologies to expand customer touch points
and thoroughly streamline administrative procedures, thereby allowing us to focus on customer service.
“Deepening and evolving the DHD model,” which aims to build a business model for realizing the long-term vision, is aboutchanging the company culture, and is oriented in the following two directions. “Deepening” is done by refining the power of“Humans” while utilizing digital technologies, as well as improving and further developing existing services and operations.
“Evolving” is achieved by creating new services and businesses, whereby our own form gradually changes. The Group defines thefurther deepening and evolving of this “DHD model” as the commonly-known category of “DX (Digital Transformation)” as generally
referred to.
The process of “deepening and evolving the DHD model” centers around the creation of new services and businesses and thereview of existing businesses, with the aim of improving customer experience value (CX). We believe that this will lead tocontributions that help realize the wishes and dreams of our customers and of those living in local communities.
Through these initiatives, the Group will take on new challenges in business fields that contribute to local communities andcustomers. Accordingly, the Group is taking steps to transform itself into a corporate group that is trusted by local communities,
customers, as well as Group officers and employees.

Message from the Management

Regarding the business environment surrounding the Group, in addition to the structural socioeconomic changes due to Japan’s
shrinking and aging population and the maturing economy, the Group is facing an irreversible trend of digitalization, and the needto respond to the relaxation of regulations and sustainability.
Based on our recognition of such a business environment, we started at the commencement of the Fiscal 2021 Medium-Term
Management Plan, which is the predecessor of the current Group Medium-Term Management Plan. In line with the plan’scommencement, we have set our long-term vision as “a corporate group that continues to create and provide new value.” Under
this vision, we aim to create and unerringly deliver value needed by the community and our customers, strengthen consultation
capabilities by the entire Group, and actively take on challenges in new business fields in order to create and unerringly deliver value
needed by the community and our customers.
By adapting to changes in the business environment while working to transform the business model of the Group, we will strive tosolve the issues faced by local communities and customers, and aim to achieve sustainable growth and enhancement of thecorporate value of the Group.

About the Iyogin Group

Long-Term Vision

Review of existing business and reduction in technical debt
Recombination of businesses based on customer needs

ActionGuidelines

4. Taking on higher goals and improving
ourselves
5. Creating a cheerful workplace with a healthy
mind and bodyMore efficient administration through introduction of RPA
Review and abolition of legacy systems
Reorganization of branches through review of operation structure

27

Iyogin Holdings Integrated Report 2023

Reduction of administrative work to one-third(Compared to March 2018)

Consulting staff 1,500 persons/Tech staff 150 persons

Corporate Data

1. Staying true to the basics and responding
quickly
2. Working locally with a global perspective
3. Quickly perceiving changes and responding
flexibly and proactively

Location free operations(Omnichannel/integration of online and offline channels)

Iyogin Holdings Integrated Report 2023

28

Value Creation Story

Sustainability Management System
Status of consideration toward identification of materiality

Responding to environmental, social, and other sustainability issues is an important management issue for the Group, which could

The Group has been working to identify materiality to incorporate response to sustainability in management from the perspective oflead to not only mitigation of risks but also profit-making opportunities. With the aim of working on matters that contribute toenhancing corporate value of the Group over the medium to long term.

improvement of sustainability overall across the Group from the perspectives of both business activities and social contribution
activities, we have established a “Group Sustainability Committee” chaired by President of the Company, which discusses suchmatters as the status of response and information disclosure related to sustainability.

About the Iyogin Group

Establishment of Group Sustainability Committee

We have proceeded with the consideration following the process below, so that we can reflect the perspectives of both investors
and multi-stakeholders (double materiality).
Going forward, we intend to identify materiality by sorting out and integrating materiality candidates considering the evaluation
by internal and external officers and each divisions, as well as evaluation and opinions of external experts, and by discussing andresolving them at meetings of the Board of Directors.

Message from the Management

We will further push forward with the consideration, so that we can plan and set targets for action plans centered around the

The Board of Directors (Audit and Supervisory Committee)

identified materiality in the next Medium-term Management Plan which will commence in fiscal 2024.
Supervision

Implemented

ReportingGroup Sustainability Committee (Chairperson: President)
Secretariat: Corporate Planning Division
Instruction
ReportingGroup Sustainability Subcommittees

Purpose of establishment

Composition and Structure
Chairperson: President
Members: Directors, Executive Officers, General Managers ofrelated divisions, presidents of group companies,etc.

 atters related to the formulation of a basic policy onMsustainability, and identification of material issues regarding
sustainability
Important matters concerning initiatives that contribute to an
improvement of sustainabilityImplementation of evaluation analysis by
an ESG evaluation body and identificationof eight items as materiality candidates
from the perspective of investors

Reporting
CSR Promotion Subcommittees

Major agendas in fiscal 2022

Selection and evaluation of the degree of importance of materiality candidates<Number of meetings held>
14 times

1. Selection of materiality candidates for the Group which cover both the above two perspectives (25 items)
2. Implementation of evaluation of the degree of importance by internal and external officers, etc. and external experts<General issues>
Identification of materiality and initiation of consideration
related to formulation of the basic policy for sustainability
Reporting of the status of consideration related to
identification of materiality<Environmental issues>Reporting on the status of response related to climatechange in line with the TCFD recommendations
Reporting on the research toward signature participation in
the Poseidon Principles
Reporting on actual results related to the targets to reduce
CO2 emissions in fiscal 2021
Reporting on actual results related to the sustainable financetargets in fiscal 2021
Reporting on results of the scenario analysis of transition
risks and physical risks related to response to the TCFD
<Social issues>Reporting on the status of consideration related to the basic
policy for practicing human capital management, as well as
human capital disclosurePreparation of the Health Management Strategy Map
Conclusion of agreements for collaboration and cooperation
with two national institutes of technology in Ehime
Prefecture

environment (stakeholders)Identification of 109 impact candidate items through value chain
analysisIdentification of 118 social issues with reference to UN Impact Radarand Ehime Prefecture’s long-term planImplementation mainly by the secretariat of the evaluation of thedegree of impact of over 200 impact items of the Group on eachstakeholder, and identification of 114 materiality candidates fromthe perspective of multi-stakeholders

Identification of materiality
3. Sorting out and integrating materiality candidates

Materiality

Materiality

4. Discussion and resolution by the Board of Directors

Materiality

Materiality

Sustainability

Matters to be discussed

Impact of the Group on the externalBusiness Strategy and Plan for Realizing
the Long-Term Vision

To discuss matters that contribute to the improvement ofsustainability overall across the Group from the perspectives of bothbusiness activities and social contribution activities, for the purposeof realizing sustainable environment/society and increasing theGroup’s corporate value in the medium and long term.

Impact of external environment

Value Creation Story

Local Economy Revitalization
Subcommittees

Instruction
ReportingMateriality from the perspective of multi-stakeholders(social issues) on the GroupTo be implemented

Instruction

Materiality from the perspective of investors

Materiality

Formulation of the Fiscal 2024 Medium-term Management Plan
Corporate Data

29

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

30

Value Creation Story

Value Creation Process
External Environment

Financial Capital (Fiscal 2022)

Climate change and energy
problems
Diversification of financial
providers
Evolution of technology

Business Model

DHD Model

Customer Contact Points (Touch Points)
Constantly establish new touchpoints for everyday contact

Digital relations
Construct a mechanismthat allows us to becontinuously
connected tocustomers

Human Capital (Fiscal 2022)

DigitalTouch Points

DigitalOperations
Location free operations

Intellectual Capital (Fiscal 2022)
An established brand and trust fromthe local community cultivated over
140 years of history
Comprehensive ability of the entire
Group
Advanced digital adoption
Ship finance and market investment
know-how

31

Iyogin Holdings Integrated Report 2023

Smooth and diverse financing
Management support centering on
business feasibility assessment
Various consulting functions according
to customer needs (M&A, businesssuccession, start-up support, businessmatching, staffing, DX support, etc.)

Personal Related“Easy and Convenient”
Cash payment services, various mobile
apps“Borrowing”
Loan products that utilize digitaltechnologies, etc.
“Saving and Increasing”
Various financial instruments, etc.
“Preparing”
Level premium insurance, etc.
“Preserving and Bequeathing”
Testamentary trusts, inheritanceconsultations, etc.

Ship Related

Human
Consulting
Consulting
Customer consultations
Provide timely and appropriate
information and suggestions tocustomers who consult with us

Ship financeRisk consulting concerning the
shipbuilding and ocean transportindustries
Business matching and project
brokerage between domestic andoverseas ocean transport companies

Shareholders andInvestors
Enhancement of medium- tolong-term corporate value
Stable profit returns
Proactive dialogues

Employees
Realizing the five elements of
Well-Being (career, social,financial, physical, andcommunity)

Make customeroriented proposals

Management foundationthat supports value
creation

Market Investment

Nurture human resources in order to become a consulting group
IT governance for maintaining a secure, stable, and safe banking system
Corporate governance

Resolution of management
issues through diverse andspecialized consulting
Improvement of earning power
and productivity
Provision of comfortable andconvenient lifestyles
Creating enriched lives by
eliminating anxiety for eachcustomer’s life event

ComplianceManaging securities with an emphasis
on liquidity
Managing market-oriented loans while
being conscious of profitability andsafetyLocal Communities andGlobal Environment
Regional revitalization by
resolving social issues
Reduction of CO2 emissions

Corporate Data

Operating base
Share of deposits in Ehime Prefecture
53.0% (No. 1)
Share of loans in Ehime Prefecture
35.5% (No. 1)
Highly convenient face-to-face andnon face-to-face channels
Network with the broadest regional
coverage among regional banks
13 prefectures
Diverse industrial structures of theregionCustomers

Sustainability

Social and Relational Capital (Fiscal 2022)

Construct integrated
channels that enable
operations to be
conducted “anytime,
anywhere”

Corporate Related

Business Strategy and Plan for Realizing
the Long-Term Vision

Sincerely serving eachcustomer through humanand digital touch points

OutcomeValue Creation Story

Number of employees: 2,986
Diverse human resources with expertise
1st grade Certified Skilled Professional of
Financial Planning, CFPs: 181
Small and Medium-sized Enterprise
Consultants: 75
MBAs: 5
Securities Analysts and Certified
International Investment Analysts: 83
Network Specialists: 8
Employees with a TOEIC score of 700 or
higher: 92

OutputMessage from the Management

Stable fund raising
Balance of deposits: ¥6,823.2 billion
Healthy amount of loan assets
Balance of loans: ¥5,326.0 billion
Ratio of disclosed non-performing loans:
1.75%
Sturdy level of equity
Consolidated gross equity ratio: 15.01%
Evaluation gain on securities:¥299.9 billion

Concentration of population in urban
areas and shortage of workers
Aging trend among small and medium
enterprise owners
Diversification of customer needs and values
Subsidence of the COIVID-19 pandemic

About the Iyogin Group

Input

Heightened geopolitical risks
Rising prices and monetary
tightening
Shrinking local economies

Risk management

Iyogin Holdings Integrated Report 2023

32

Value Creation Story

Striving for Improving CX
Elements of CX Improvement
and Rotation Cycle

In order to improve CX, we believe it is important to (1) know our customers well, (2) create various

1) Understanding customer needs

About the Iyogin Group

Elements of CX Improvement
forms of value including unprecedented new value, and (3) deliver them in a way that matches each4)
Mechanisms

customer’s style. Accordingly, we are working on (4) the creation of new mechanisms and thedevelopment of various systems, etc. so that the entire Group can work as a whole to realize the2)Creating value

3)
Delivering value

abovementioned elements.

CX consists of “rational value” and “emotional value,” and the

Rational value

Emotional value

Interest rates,
price, functions,product
properties...

Happier with betterthan-expected
experience, feels
trustworthy, niceand kind...

Message from the Management

Strengthening Structures at Bank Branches
Group aims to improve both in a well-balanced manner.
As one of our initiatives to improve “emotional value,” throughthe “aesthetic reform” movement to build branches that
customers feel secure and comfortable in, the bank branches andPurpose of Improving CX

headquarters are working together to enhance customer service

In 1984, Iyo Bank introduced Total Quality Control (TQC). In line with the three basic philosophies of “being customer-oriented,”

and response skills, and the environment of bank branches.

“putting quality first” and “respecting humanity,” for nearly 40 years, the Bank has endeavored to improve quality and resolve issues
While our stance of “being customer-oriented” remains unchanged, as the lifestyles and needs of our customers diversify andFeeling withthe heart

Introduction of CX Meetings

become more sophisticated, the Group must also deepen and evolve what we do for our customers. Regardless of differences in

In October 2022, Iyo Bank introduced CX meetings to firmly

touch points or contact methods, such as face-to-face or remote, digital or manned, we aim to improve everything that ourentrench the concept of “CX improvement” into its corporate

customers experience and feel through the Group, and to continue providing new value to our customers. Therefore, the entire

culture. In the future, we plan to introduce CX meetings acrossGroup is working together to improve customer experience value (CX).

the entire Group. CX meetings begin with “learning about the

Value Creation Storyfor our customers through activities of the Quality Control circles, etc.

Judging withthe brain

customer.” By drawing a customer journey map from the“customer’s perspective,” we discover the true issues hidden in
the customer experience. Then, we review and implement

In order to resolve customer issues and needs, we aim to improve CX through the realization of a consistent customer experiencesolutions by considering “what the Iyogin Group can do.”across multiple channels, and strive to improve the UX (user experience) of each channel. Through these efforts, we aim to augment

Through a series of activities, we aim to enable each and every
officer and employee to think and act from the customer’sand enhance our “customer responsiveness.”
With the aim of promoting these initiatives across the Group, we have established the CX Improvement Promotion Committee.

perspective as a matter of course, even in their daily work.

Chaired by the Group CEO, the Committee discusses matters related to the improvement and enhancement of responses andservices at all points of contact with customers, as well as matters regarding new operations and services.

Corporations,
corporate owners

Individuals

Maritimebusinesses

Business Strategies

Corporate Related

Personal Related

Ship Related

Iyogin Holdings Integrated Report 2023

Introduced CX meetings so that each and every officer and employee can enhance CX at all contact points

It wasconvenient.

There was a longwaiting time.

The person in
charge was kind.

They lackflexibility.

They areadvanced.

Corporate Data

Understand needs based on
various information and data,
and deliver optimal services
tailored to each customer

Each customer evaluates a different part of the Group, thereby giving rise to a multitude of different customer experiences

Attachment

PraiseImpactComfortAttachment

PraiseImpactComfortAttachment

A series ofuser experiences (UX)
Face-to-face,manned contact points

PraiseA series ofUser Eexperiences (UX)
Remote, manned contact points

Sustainability

33

A series of
Eexperiences (UX)
Remote, digital contact points
ImpactIssues andneeds ofcustomers

ComfortCustomer Experience Value (CX)

Business Strategy and Plan for Realizing
the Long-Term Vision

Establishment of Business Strategies based on CX improvement and establishment of Committee therefor Improving CX

Iyogin Holdings Integrated Report 2023

34

Business Strategy and Plan for Realizing the Long-Term Vision

Overview and Progress of the Group
Medium-Term Management Plan

Personal
relatedstrategies

Busi ness S tra te g i e sMarket investment
strategies

Be conscious of overall profit and loss that lead to stable profit and future
profit, and diversify investments with a focus on liquidity

BPR strategies

Aim to increase productivity of the entire Group by minimizing administrativeand routine work and enhancing manpower available for customer
interactions and planning work

New business creation
strategies

Continuously develop businesses and operations that contribute to solving
local issues and improving sustainability through appropriate and bold risktaking, thereby creating profit opportunities

Marketinvestment
strategies

Plan for branches

Aim to diversify customer touch points by rebuilding channels, including
branches

Plan forHR development

Aim to be a group which can create and offer diverse types of value by
developing personnel who can work actively in areas of their expertise
under the basic approach of “being customer-oriented”

Plan forhuman resources

Aim for the timely and appropriate allocation of human resources toimprove productivity of the Group

Creation of newservices andbusinesses

DigitalOperations

Sincerely serving eachcustomer through humanand digital touch points
Human
Consulting

Plan for IT

Plan for HR
development

Plan forbranches

Plan for humanresources

Deepening andevolving the DHD
model = “DX”
Change in company culture(fixed thinking)

Improvementin customer
experiencevalue (CX)

Review of existing
business andreduction intechnical debt

Major Numerical Targets
Items

Fiscal 2022 Results

Targets for Fiscal 2023

Consolidated core business gross profit¥89.5 billion¥86.0 billion

Profit attributable to owners of parent¥27.8 billion¥23.0 billion

Consolidated ROE (shareholders’ equity basis)

5.40%

4.0% or more

Consolidated core OHR

58.80%

Approx. 60.0%

Consolidated common stock Tier 1 ratio

15.00%

Approx. 15.0%¥8.2 billion¥9.0 billion

Core business gross profit of Group companies(excluding the Bank)

Sustainability

Plan

Appropriately grasp changes in the maritime industry’s business environmentand support business investments that are optimal for customers

Business Strategy and Plan for Realizing
the Long-Term Vision

DHD
Model

Ship related strategies

Aim for the establishment of IT governance that not only achieves prompt andflexible digital response to the external environment and customer needs, andbut also maintains a secure, stable, and safe banking system as well

BPR strategies

DigitalTouch Points

Provide integrated solutions for each customer in all channels and realizeenhancement in customer experience value

Plan for ITPlan

New businesscreationstrategies

Personal related
strategies

Ship related
strategies

Realization of long-term visionCorporate
relatedstrategies

Provide integrated solutions through cooperation between the Group, partnercompanies, etc. to improve customer experience value

Value Creation Story

Business Strategies

The Group

Corporate related
strategies

Message from the Management

Overview of the Group Medium-Term Management Plan

Basic Policy for Business Strategies and Plans
About the Iyogin GroupThe Group Medium-Term Management Plan consists of six business strategies and four plans that support the business strategies. It
is based on the Fiscal 2021 Medium-Term Management Plan, with the addition of “new business creation strategies” aimed at
expanding our business fields, which is one of the objectives of our transition to a holding company structure. By having the entire
Group work as a whole to further deepen and evolve the DHD model, we aim to improve sustainability as a corporate group.
Fiscal 2023 is the final year of the plan, and the entire Group will continue to work as a whole to promote the deepening and evolution of
the DHD model. We will strive to create new services and businesses, review existing businesses, and reduce technical debt, as we work towardrealizing our long-term vision of becoming “a corporate group that continues to create and provide new value.”To that end, in order to shift the manpower and time created by BPR strategies to operations that contribute to strengthening
profitability, we are converting to a business model that adheres to the following principle: “In areas where digitalization is useful,thoroughly implement digitalization. In areas that humans are good at, put humans in charge.” Accordingly, we believe we should
review the roles played by human employees, so as to effectively utilize the manpower created by BPR strategies. Moreover,enhancing the “roles played by human employees” is all about regarding our human resources as “human capital.” Accordingly, we
will further nurture our human resources.

Corporate Data

*Core business gross profit of Group companies (excluding the Bank): Total core business gross profit of Group companies excluding theBank, before inter-group elimination

35

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

36

Business Strategy and Plan for Realizing the Long-Term VisionCorporate Related Strategies
Provide integrated solutions through cooperation between the Group, partner companies, etc. to improvecustomer experience value

Sharing of Management Issues through BusinessFeasibility Assessment
Number of Mirai Support Sheets prepared
Number of business feasibility assessment
investigation committee held

(Number)
8,000

6,257

7,000

5,393

6,000

4,468

5,000

Key Action
Plans
Solution revenue

Fiscal 2021Fiscal 2022
Cumulative Results

Fiscal 2021Fiscal 2023
Cumulative Plan

¥5.0 billion ¥10.1 billion¥11.0 billion

Number ofbusiness feasibility
assessments

864

1,547

2,400

Number of new
customers

1,109

2,224

3,900

Number of cases for
M&As and businesssuccession*

146

378

435

Number of staffing
contracts

99

209

320

2,354
2,062

1,784

1,500

1,437
1,000

3,000

1,749

1,005

2,000

500

1,000

391

524

0

*Including consulting services related to inheritance for the wealthy

2,000

Identifying andsharing
customers’
management
issues

4,000

Formulatingconcrete
supporting
measures forenhancement ofcorporate value

3,000

Fiscal2017

Fiscal2018

Fiscal
2019

Fiscal
2020

Fiscal
2021

3,678

3,066

507

115
359 4,007

2,000
1,000

156

139

908

3,000

2,592

Corporate solutions revenue*

5,138

5,054

5,000

0

0

Fiscal2016

Overseas, derivatives

Others(Millions of Yen)
6,000

171

1,732

4,112
610

3,250

202

3,300

0

Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2022 Fiscal 2023
(Plan)(Plan)

Fiscal2022*Financing-related (including relevant derivatives), business succession
and M&A, business matching, corporate life insurances, etc.

Key Efforts

Value Creation Story

All strategies in the Fiscal 2021 Medium-Term Management
Plan are for the improvement of customer experience. They
are formulated based on our customers’ issues and needs.
Corporate related strategies focus on measures for fundsupply, business support, and management support, based on
business feasibility assessments from ESG/SDGs perspectives.
Such perspectives take into account regional and social issues,in order to offer concrete solutions to issues and needs ourcustomers face in their business stages and value chains, andto overcome those issues and needs together based on
business feasibility assessments from ESG/SDGs perspectives,
such as regional and social issues.

Fiscal 2021
Results

3,329

4,000

Owing to contributions from financing and derivatives, etc.,
plans for the final year (fiscal 2023) of the current MediumTerm Management Plan were achieved ahead of schedule.

Message from the Management

Fiscal 2021 Medium-Term Management Plan

Solution Revenue Results(Number)
2,500

6,940

About the Iyogin Group

Amid the aging population with low birthrate, declining population, and a decrease in the number of business
operators, as well as drastically changing life styles and values, our customers’ management issues and needs
have become more sophisticated and diverse than ever. They have extremely higher expectations for financial
institutions than ever. Under such circumstances, the Group, as a regional financial institution, intends to offer
both financial and non-financial support in a comprehensive manner. To that end, the entire Group will strive to
respond flexibly, and also offer consulting services in cooperation with external institutions.

We respond meticulously to the management issues and needs of customers by not only offering financing and other typesof financial support but also helping customers address non-financial issues, such as labor shortages, inheritance issues, andcarbon neutrality. We will continue to take flexible measures, including expansion of consulting menu, according to customer
needs.

Customer issues and needs
Businessfoundation

GrowthReform/DeclinePurchase Produc- Shipment
Sales
DistribuMarketing Services
Logistics tion
tion

Smooth and diverse financing
Business matching, overseas business development,
manufacturing, efficient use of real estate, asset management,risk management, etc.
Businessfoundation(Various issues and needs in business stages and value chains)

Lease
Systemdevelopment
Think
tank

VenturecapitalSecurities

Management
improvement andturnaround

ESG/SDGs as business
opportunities

Strengthening consultation
capabilities at the entireGroup
Creditcards

M&A/businesssuccession

Labor shortages and organizational
restructuring

Productivity improvement by ICT
utilization

Creation of businesses suited to
the region

Business succession(Number)200

M&A

Number of new inquiries(Number)
600

Branding in the primary industry andtourism

400

120

100
50
0

83

87

491

13

17

16

Fiscal 2020

Fiscal 2021

Fiscal 2022

400

378

300
200

81

100

40
Fiscal 2023
(Plan)

Number of contracts

561

0

69
Fiscal 2020

99

110

Fiscal 2021

Fiscal 2022

150

Fiscal 2023
(Plan)

Manufacturer Support

We provide a wide range of inheritance-related measures
as one-stop consulting, including will writing support,
testamentary trust, setting up civil trust and inheritancearrangement services. In addition, since November 2021,
we have concluded agreements on bequest donations
with local governments and organizations in Ehime
Prefecture one by one.
As a financial institution with deep roots in the region, we
will leverage our strength of our day-to-day activities inlocations closest to our customers, and provide personalized
support to accommodate our customers’ wishes in order torealize smooth succession of assets while in life before until
after the actual bequeathing event occurs.

We provide support for new business creation forcustomers who consider new business development
different from their existing businesses due to changes inthe economic environment caused by COVID-19, byleveraging subsidies for business restructuring and othersupport measures from the government, etc.
In an environment where responses to carbon neutrality
are required, we are making efforts for regional
revitalization through providing advice on technology
development that contributes to decarbonization bycooperation among industry, academia, government, andfinance, and providing support on reducing GHG emissions
and other measures.

Iyogin Holdings Integrated Report 2023

Corporate Data

Wealth Advisors

Sustainability

We promote business feasibility assessment to strengthen transactions with corporate customers, our key revenue base, and help ourbusiness partners increase their corporate value. Our headquarters and branches work together to offer loans and engage in
consulting sales.
For customers that have undergone business feasibility assessments and are considered particularly important by branches, weprepare Mirai Support Sheets and hold business feasibility assessment investigation committees. Our headquarters and branches thusalign their views on business partners’ issues and how to address them, as well as on policies for future initiatives.
As a result of the above efforts, solution revenue for fiscal 2022 totaled approximately ¥5.1 billion, exceeding the plan by ¥1.4
billion. We will continue to aim to create enhanced corporate value for customers and expand Group revenue by addressing
customer issues and needs.

Iyogin Holdings Integrated Report 2023

Expanding steadily, with total of 1,430 inquiries including
278 contracts since the service started in April 2020.
Started new job-seeking business (career advisor andrecruiting advisor) in October 2021 and focused onstaffing for management positions.

500

Initiatives Based on Business Feasibility Assessment

37

Staffing BusinessWe have built a structure that can provide one-stop
support for issues such as organizational restructuring,transition to a holding company structure, and M&A
support due to lack of successors, providing support foraround 100 cases per year.

150

Regional and social issues
Support inconsideration ofcooperation withpartnercompanies,
external experts,
local public
entities, etc.

Support for M&As and Business Succession

Business Strategy and Plan for Realizing
the Long-Term Vision

Purchase Produc- Shipment
Sales
DistribuMarketing Services
Logistics tion
tion

Matured38

Business Strategy and Plan for Realizing the Long-Term VisionCorporate Related Strategies
Support for Overseas Business Development

Hong Kong
Representative Office
IndiaInternational
Division

Toyo Business Service PCL

Thailand Dispatched one employee

TaiwanThailand Kasikorn Bank

MAI International Associates JSC

CTBC Bank

Number of Contracts(Number)

2,711
2,654

Metropolitan Bank

Fiscal 2020

Joint Stock Commercial Bank for Investment

Vietnam and Development of Vietnam (BIDV)

MexicoHo Chi Minh City Development Joint
Vietnam Stock Commercial Bank (HD Bank)
Singapore

Iyo Bank

United Overseas Bank (UOB)
PT Bank Negara Indonesia
Indonesia(Persero) (BNI)
Central Pacific Bank

Hawaii, U.S.A.

Business alliance with HD Bank in Vietnam

We concluded a business alliance agreement with HD Bank (Ho Chi Minh City Development Joint Stock Commercial Bank),
headquartered in Ho Chi Minh City, to strengthen our support structure for financial services and information provision in Vietnam.
Through the business alliance with HD Bank which operates in over 320 locations in Vietnam and has a Japan Desk that offers
consulting services in Japanese, we will further support our customers’ businesses in Vietnam. With this business alliance, our alliancenetwork with overseas financial institutions has expanded to a total of 12 banks in 10 countries/regions.

Discovery ofcapital investment projects(Millions of Yen)

Customers

13,25812,458

Approach/contract

Iyogin Leasing

Fiscal 2020

Fiscal 2022

Fiscal 2023
(Plan)

We provide optimal solutions related to payments in line with theneeds of our various corporate customers. In recent years, wehave responded to various needs including responses to thecashless BtoB transactions and the revised Electronic Bookkeeping
Act. We will continue to work to solve customers’ issues byfocusing on the problem-solving type proposals such as total
support for highly compatible digitalization and cashless
settlements, also by cooperating with Iyogin Digital Solutions andother group companies.

Number of cumulative corporate cards issued
Amount of transactions via corporate cards
Number of corporate cards issued(Millions of Yen)
6,000

9,000

8,744

5,000
4,000

9,000 (Number)

8,800

8,578

8,637
8,600

3,000

3,773

4,158

8,400

4,948

8,200

1,000

0

Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2023
(Plan)

8,000

Cooperation with Iyogin Regional Economy Research Center
Consulting Sales and Number of Contracts(Millions of Yen)
120

Consulting sales
Number of contracts

85
79(Number)
90
80

100

Sustainability

70

58

80

60
50

60

38
96

100

40

52
20
0

40
30
20

33
Fiscal 202010

Fiscal 2021

Fiscal 2022

Fiscal 2023
(Plan)

0

Iyogin Holdings Integrated Report 2023

Corporate Data

Iyo Bank’s sales representatives interview business owners of thebusiness partners about their management issues in the course of
their daily sales activities, and communicate the results to the
Iyogin Regional Economy Research Center (IRC).
In recent years, their business environment has been rapidlychanging due to the development of work style reforms, chronic
shortage of labor, and other factors. As a result, management
issues of our customers are becoming more sophisticated andcomplex on a daily basis. At IRC, Small and Medium-sizedEnterprise Consultants, management consultants, and otherspecialists meet a wide range of needs including management
strategy design, operational innovation, personnel system reform,and human resource development.
IRC will continue to support the growth and development ofour customers as a long-term partner while helping them solve
issues with the support tailored to each customer.

Business Strategy and Plan for Realizing
the Long-Term Vision

Enhancement of local medical structure

Fiscal 2021

Cooperation with Iyogin DC Card

Cooperation

Key items of cooperation
1. Marketing and identification of issues within each secondary
medical care area
2. Advice on the ideal future medical service provision structures
3. Consulting on changing to appropriate beds
4. Other matters related to the revitalization of local medical
services

Fiscal 2023
(Plan)

14,438

Information
linking
Referrals to
newcustomers

Management Support for Medical Institutions with a Regional Perspective

Iyogin Holdings Integrated Report 2023

Fiscal 2022

Contract Amount

2,000

39

Fiscal 2021

Banamex

Providing our customer’s precision technology to the Philippines!
Supporting overseas development through JICA’s program

The environment surrounding the medical industry is
becoming even more challenging due to issues such as
negative revision of medical fees and shortage of medical
personnel, in addition to responses to COVID-19, and thenumber of medical institutions with management issues is on
the rise. Meanwhile, issues of medical care provision structures
vary depending on the region, as the number of elderly people
and medical resources such as doctors and nurses in the future
differ from region to region.
In order to provide management support with more regional
perspective, Iyo Bank concluded a business collaborationagreement on revitalization of regional medical services with
Nihonkeiei, Co., Ltd. in May 2022. Based on this agreement,
we support initiatives of local communities and medical
institutions to maintain their medical service provision
structures by effectively combining our mutual resources andcase studies.
Currently, we are actively involved with local stakeholders(government, medical associations, university hospitals, andother institutions) and provide management support to
medical institutions from both a “point” and “side”
perspective.

2,746

Value Creation Story2

We support customers in capital investment plans while linking
data among the Group. We propose loans by Iyo Bank as well as
introduce leasing by Iyogin Leasing to meet the diversified
financial needs of customers. As a financial institution with deeproots in the region, the entire Group supports customers whoembark on capital investment.

Philippines and Trust Company

Vietnam Dispatched one employee

The field survey business applied to JICA in cooperation with our customer who aims to develop its business in the Philippines was
selected for the SMEs/SDGs business support program. This project matches developing countries with private companies that cansolve social issues of such countries, and a total of four projects have been selected by JICA for cooperation between Iyo Bank and its
customers (as of the end of March 2023). We will continue to cooperate with JICA and other public institutions to support ourcustomers’ overseas development and contribute to solving social issues in developing countries.
CASE

Cooperation with Iyogin Leasing

Message from the Management

1Bank of

China Communications

State Bank of India (SBI)

Singapore Branch

CASE

Shanghai
Representative Office

About the Iyogin Group

Employees with overseas experience (overseas locations:Singapore, Shanghai, and Hong Kong; overseas trainees:
Thailand and Vietnam) in the International Division, together
with overseas locations form an independent network andsupport the expansion of customers’ overseas business. To
meet increasingly sophisticated customer needs for overseas
business solutions, we work to upgrade our overseas
consulting function in close cooperation with public
institutions such as Japan External Trade Organization (JETRO),
Japan International Cooperation Agency (JICA), and Japan
Bank for International Cooperation (JBIC), as well as overseas
partner banks and private sector companies.

China Bank of Dalian40

Business Strategy and Plan for Realizing the Long-Term Vision

Personal Related Strategies
Provide integrated solutions for each customer in all channels and realize enhancement in customer
experience value

Provide the Best Consulting to Customers by Staying Close to Their Lives

support tailored to each customer’s life plan. To that end, the Group provides both speedy and seamless

We provide optimal consulting at each life stage of customers utilizing “LIFE PALETTE,” a life plan simulation tool, to delve into theirservices utilizing digital technology and warm services that only human beings can deliver through humantrue needs. We regard “LIFE PALETTE” as one of the important contact points between our customers and Iyo Bank, and aim to

consulting.

improve CX through seamless and continuous support to customers while staying close to their lives.

Customers have a range of issues and needs at different life stages, such as “easy and convenient,” “borrowing,” “saving andincreasing,” “preparing,” and “preserving and bequeathing.” Our personal related strategies strive to improve customer experience(CX) by providing, as the entire Group, integrated solutions to such issues and needs. To deliver optimal CX to each customer, it isnecessary to have contact points in all channels, whether physical or digital, and provide solutions at the best timing.
The Fiscal 2021 Medium-Term Management Plan aims to further deepen and evolve existing DHD services to enhance CX.

Preserving and bequeathing

Change in assets

Fiscal 2021 Medium-Term Management Plan

Improvement
in CX

as the Contact Point

Message from the Management

Provide Continuous
Timely Support with

About the Iyogin GroupWe improve CX by providing the optimal contacts points and consulting for issues and needs with the

Support for smoothasset succession

Preparing
Proposal of the optimum insurance
plan in case of an emergency

Increasing
Prolonging theasset life-span withasset management

SavingSupport for asset formation withlong-term diversified investments
Life stage

Customer Issues and Needs

Initiatives to Realize Life Plans
Graduation–
Start a job

Carpurchase

Have
children

Borrowing

Buy
insuranceHomepurchase

Saving and Increasing

Preparing

Education
expensesAsset
succession

Bequeathing
and transfer

Preserving and Bequeathing

Key Action Plans

Amount of retailcashless payments

Number of new
SAFETY contracts

HOME
HOME rate*1

Group assets incustody balance

Number of level
premium insurance
customers

Number of inheritancetrust, etc. customers

Fiscal 2021-end
Results¥27.7 billion

1,550

70%

¥617.1 billion

31,328405

Fiscal 2022-end
Results¥29.3 billion

4,242

70%

¥654.9 billion

33,326565¥40.0 billion*2

7,200

80% or more ¥669.0 billion*3*1 Percentage of housing loan application using HOME *2 Amount at the end of fiscal 2023
*3 Balance at the end of fiscal 2023 including individual deposits in foreign currencies

We support stable, long-term asset formation to help
customers realize prosperous lifestyles. Our basic policy is todiversify in terms of time, currency, and assets. We propose
portfolios to protect assets of our customers fromenvironmental changes such as rising prices and diminishing
public pension amounts.
In addition, for the new NISA starting next year, we willcontinue our efforts to improve financial literacy by informinga wide range of customers of the structure and how to utilize
the NISA, amid the accelerating trend from savings toinvestment.

Change in Group Assets in Custody Balance(Billions of Yen)
700
600
500

Shikoku Alliance Securities

Iyo Bank

654.9

669.0

605.3

617.1

245.2

246.0

275.0

288.0

360.1

371.1

379.9

381.0

Fiscal 2020

Fiscal 2021

Fiscal 2022

Fiscal 2023
(Plan)

400
300
200
100
0

Cooperation with Shikoku Alliance Securities
As customers’ wishes and needs for asset management vary, we are cooperating with Shikoku Alliance Securities to provide

730

more specialized products, information and consulting services. The entire Group will support our customers’ asset formationby providing optimal services to meet a wide range of needs.

Preparing

Preserving and Bequeathing

We provide timely proposals and services to respond to futurerisks that change with the occurrence of life events such as
marriage, childbirth, home purchase, and retirement, and tomeet the needs to prepare for such events.
In addition to more than 100 insurance consultants
deployed at 60 bank branches within Ehime Prefecture,
insurance plazas (11 locations within Ehime) are available for
consultation on weekends and holidays. For customers who
cannot use these locations, online consultation is available.

We are responding to diversified and enhanced needs forbequeathing due to the progress in aging population, throughclose cooperation between bank branches and the external
relations division at the headquarters.
We not only provide inheritance consulting utilizing thecoverage functions of insurance but also offer a range of
relevant products and services, including preparation for
nursing care, will writing support, civil trust, and inheritancearrangement services. We are thus prepared for one-stop,
tailor-made support while in life before until after the actual
bequeathing event occurs, connecting our customers’ wishes.

Iyogin Holdings Integrated Report 2023

Corporate Data

Iyogin Holdings Integrated Report 2023

39,500

Saving and Increasing

Sustainability

Fiscal 2023-end Plan

41

Asset
management

Business Strategy and Plan for Realizing
the Long-Term Vision

Easy and ConvenientGetmarried

Value Creation Story

Birth–
University

42

Business Strategy and Plan for Realizing the Long-Term Vision

Personal Related Strategies

DHD Services

New Card Loan Service That Issues Notifications on Insufficient Amount

AGENT is a smartphone app that enables customers to access to counters from anywhere, and complete procedures by themselves

SAFETY, a digital card loan service, is an app that allows one-tap borrowing and repaying around the clock. Customers can also
increase the borrow amount through the app after starting the use.
We offer the “Standard type,” and the “Premium type” in which interest rates are set based on the “screening results” instead of
the “borrow amount.”
In October 2022, we obtained a patent for a function that notifies the customer of the forecasted insufficient balance and allows
the customer to borrow the insufficient amount.

or via a video chat with the bank staff. Customers can open ordinary and time deposits accounts, change addresses, and go throughother procedures as they video chat with our staff, just as they do at branches. Based on the conversation, the staff member incharge can register information on behalf of the customer. Those who are unaccustomed to smartphones can therefore feel
comfortable using the service.
Adoption of agile development has allowed systematic enhancement of usability and addition of functions since the app’s release

About the Iyogin GroupIyo Bank on Your Palmin June 2021. For example, the balance inquiry, video chat appointment, and transfer functions have been added. Various functions

April 2022:
July 2022:

See here forservice details

See here forservice details

Same interest rate for the same customer, even
if the borrow amount changes

Standard type

14.5%

Premium type1.9% 12.0%¥0.1million ¥0.5million¥10million

Value Creation Story

Real-time Visa debit statements began to be issued
nNew function was added to substitute identity checking foraccount registration at branches
October 2022: Part of the inheritance procedures began to be handled via a video callJanuary 2023: New function was implemented for procedures for lost or stolen
passbook, etc. (suspension of use, reissue, etc.)
April 2023:
New product “Time deposit special to AGENT” became available
May 2023:
New function was added for transfer
Summer 2023:Family account sharing service is available (plan)
Winter 2023: New functions are added to open investment trust account,purchase and sell investment trust (plan)Interest rate

One-tap borrowing aroundthe clock

Ongoing Expansion of AGENT App Functions

Message from the Management“Card loan as an ordinary tool useful in daily life”

are expected to be offered also in fiscal 2023. We will continue to offer new counter service experience.

BorrowamountHouse Purchasing Plan with a Smartphone
Simulation Tool That Allows Customers toChart Various Future Plans, a smartphone-based digital housing
loan service, allows customers to apply for
housing loans and sign loan agreements
anytime and anywhere.

LIFE PALETTE is a digital tool that simulates changes inhousehold finance balance and assets, based on future life
events entered from customers’ own smartphones or tablet
devices. Customers can check their financial health andconsult with advisors at the counter or online if they have any
concerns. We thus provide support for life plans tailored foreach customer’s life plan.

Renewed in April 2023
 ropose money improvement actions tailored for eachP
customer, and the improvement effect can be seen at a
glanceProvide information not only on money but also on tips
for life plan and life improvement
Evolved to an easier and more user-friendly UI and UX

Value provision tailored to customers’ life plans and life events

Strengthen Housing Loan Initiatives
In April 2022, we extended the longest borrow period for fixed rates for initial period type products to 40 years and are running a
special interest rate promotion (until the end of December 2023). In March 2023, the longest borrow period for step-up interest rate

Sustainability

type products, our main products, was also extended to 40 years. Now, all housing loan products can be borrowed for up to 40

 rovide information and advice, and propose products andP
services tailored to customers’ life plansOnline consulting enables us to provide consulting services
to more customers by sharing their life plans with advisors

Business Strategy and Plan for Realizing
the Long-Term Vision

See here forservice details

years.
In addition, in order to meet a wider range of needs, we introduced group credit life insurance by Credit Agricole Life Insurance
Company Japan Ltd. in January 2023. We are offering a reduction in extra interest rate through January 2024.
Furthermore, in response to the growing needs for variable interest rates due to the current interest rate environment, we
introduced variable interest rate housing loan in June 2023 to allow customers to select the best interest rate plan according to theinterest rate environment and their needs.
For customers who have not yet taken out a housing loan,

See here forservice details

See here forservice details
Corporate Data

we offer “Housing Consultation Counter” referral service thatallows customers to select the housing company that best fits
their needs.

43

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

44

Business Strategy and Plan for Realizing the Long-Term Vision

Ship Related Strategies
Appropriately grasp changes in the maritime industry’s business environment and support business
investments that are optimal for customers

Balance for the Maritime Industry

In Ehime Prefecture, there are approximately 80 offices of ocean-going vessel owners, and they effectively own roughly 32% of all

As a result of the above initiatives, the loan balance for theocean-going vessels owned by Japanese companies. Ocean-going vessel owners in Ehime are known in the world as “Ehime owners.”

maritime industry as of March 31, 2023 stood at ¥1,214.0

When it comes to shipbuilding, approximately 15% of all ships constructed in Japan are from Ehime Prefecture. The figure rises toLoan Balance for the Maritime Industry

1,200

groups. Thus, shipbuilding also can beof ¥136.6 billion from March 31, 2022. The balance for ship

1,000

finance has been increasing as we have steadily offered loans.

800

Ehime, ranked top-class in Japan. Iyo Bank’s

New vessels constructed in JapanNew vessels constructed in Japan(As of September 2020)

ship finance aims to support the growth anddevelopment of these local maritime andshipbuilding industries, as well as the entire

Ehime
32.7%

maritime cluster that includes relevant(1,199 vessels)

industries. We have long grown together with

The increase has been taking place despite the increasing

Ehime
Ehime
15.7%
15.7%
(1.87 million gross tons)

larger and higher priced, additional costs to meet the(1.87 million gross tons)

Other than Ehime
Other
84.3%than Ehime
84.3%

Other than Ehime
67.3%

our customers.

(Fiscal 2020)(Fiscal 2020)

As described above, the role of Iyo Bank’s

No. 1 in Japan
11.92 million gross tons of
new vessels constructed in Japan

Japan’s maritime-related industries in general.
Based on such an understanding, we actively
engage in business activities every day.

*Iyogin Regional Economy Research Center, Inc.
(IRC) estimates; the ranking in Japan excludes
vessels owned by major ocean transportcompanies.

other factors. Loans for shipbuilding yards and other maritime-

Going forward, our activities will be directed toward broader
and deeper win-win relationships with ship owners, shipbuilding
yards, ship equipment manufacturers, and other members of the(46.8)March 31,
2022

905.0

Compared toMar. 2022+136.6New
transactions

Scheduledpayment

Advancerepayment

Impact offoreignexchange rates

March 31,2023

Loans for ships manufactured by Japanese
shipbuilding yards that have high fuelefficiency
Initiatives for loans for LNG dual-fuel ships

Control of Credit
Concentration Risk
Concerning Ship Finance
Providing diverse financing
sources such as compositionof syndicated loans based on
the framework of the
TSUBASA Alliance, etc.

Understanding the industry
and advancing efforts to solve
problems through wideranging cooperation withmaritime clusters centered on
Tokyo and Imabari

Enrichment in Activities
Connecting Domestic
and Overseas Maritime
Industries
Aiming to provide new value
unique to Iyo Bank forbusiness opportunities suchas chartering and selling ships

38.9%

Provide long-term, fixed-rate funds for the
improvement of construction quality,
reduction of the environmental impact ofships, and saving energy, etc. to shipbuilders,
ship operators, and ocean transportation
operators who have formulated plans thatmeet the criteria set by the government.

46.8%

14.3%

Initiatives for sustainability linked loans (March
2021) and transition loans (September 2021)
Activities to match energy-saving added device
manufacturers with shipowners

EEDI Phase 3
Dual-fuel Ships (LNG, LPG, and Methanol)
Conventional Ships and Used Ships*Within ship-related cases approvedin the recent 6 months

C

Deepening into Bank-wide
efforts for more appropriate
business feasibility assessmentsof the maritime industry

Improvement in Research andAnalysis Capabilities Concerning
the Maritime Industry in GeneralPI

Improvement in Risk
Consulting Capabilities
Concerning the Shipbuilding
and Ocean Transport Industries

Obtained certification as a designatedfinancial institution based on the
Maritime Industry Strengthening Act(partial revision of the Shipbuilding Act
and the Marine Transportation Act)

Ratio of ships designed withenvironmental initiativein mind in loan decided cases

Initiatives at the Singapore Branch

Established in December 2016, our Singapore

Singapore Branch Loan Balance(Billions of Yen)
250

Branch not only collects the latest local

200

information but offers financial support mainly

150

to local shipowners, rolling out our long-standing100

know-how in loans for ships.

50

189.7

216.4 226.1

149.1
102.4
65.1

Corporate Data

Iyogin Holdings Integrated Report 2023

+41.6

768.4

800

0

45

(87.5)

900

initiatives, with the major goal of supporting optimalTOcase intermediation between maritime businesses.

+229.31,000

Iyo Bank will continue to actively engage in relevant

Sustainability

Tokyo Desk of Ship Finance Division, to business matching and

Fiscal 2022

(Billions of Yen)
1,100

rate fluctuations.

energy efficiency starting in 2025 in advancea wide range of maritime businesses, mainly conducted by the

Fiscal 2021

Breakdown of changes in balance for domestic andoverseas ocean transport in fiscal 2022

changes in amounts when translated into yen due to exchange

Loans for ships following the regulations on

maritime cluster.

0

for costal trading vessels and logistics facilities. In addition, theworking on relevant initiatives.

Furthermore, we aim to link active information exchange with

Fiscal 2020

905.0

related businesses also increased since we responded to loans“enrichment in activities connecting domestic and overseas maritime industries” as its principal measures. We have been actively

better ways to control various risks for ship owners.

Fiscal 2019

768.4

Business Strategy and Plan for Realizing
the Long-Term Vision

analysis capabilities concerning the maritime industry in general,” “control of credit concentration risk concerning ship finance,” andderivatives, and are striving every day to explore and propose

Fiscal 2018

730.3

Initiatives to Support Decarbonization of Ocean Transport“improvement in risk consulting capabilities concerning the shipbuilding and ocean transport industries,” “improvement in research andWe have also made risk hedge proposals utilizing financial

645.1

700

investments that are optimal for customers”, ship related strategies in the Fiscal 2021 Medium-Term Management Plan focus on theyards to address issues identified through discussions with them.

587.4

changes in the loan balance.

Under the basic policy of “appropriately grasping changes in the maritime industry’s business environment and supporting businessFor example, we have been considering productivity

266.1

221.8

200

environmental regulations such as alternative-fuel ships, andinvestments for customers, and without being bound only by

Fiscal 2021 Medium-Term Management Plan

improvement and other measures together with shipbuilding

296.0

Value Creation Story

No. 1 in Japan
3,663 total vessels in Japan(including operators)

maritime cluster, help the development of

163.6

400

balance for overseas has been increasing steadily despite

ship finance is to, as a member of the local

309.0

600

investment amount per project due to the trend of ships getting

1,214.0

Message from the Management

overseas ocean transport finance was ¥905.0 billion, an increase

Number of ocean-going vessels owned
by domestic ship owners

For other maritime industries and overseas
For domestic and overseas ocean transport(Billions of Yen)
1,400

billion. Of the total loan balance, the balance for domestic androughly 30% if combined with the proportion of ships constructed in other prefectures by Ehime-headquartered shipbuilding yard
considered as an important local industry in

About the Iyogin Group

Ship Finance as Support to Local Industries and Role as a Member of the Maritime Cluster

1.5
March 2017 March 2018 March 2019 March 2020 March 2021 March 2022 March 2023

Iyogin Holdings Integrated Report 2023

46

Business Strategy and Plan for Realizing the Long-Term VisionMarket Investment Strategies
Be conscious of overall profit and loss that lead to stable profit and future profit and diversify investmentswith a focus on liquidity

We manage securities under the basic policy of “be conscious of overall profit and loss that lead to stable profit and future profit anddiversifying investments with a focus on liquidity.” It is our policy to keep a certain proportion of bonds as assets inversely correlatedwith risk in stocks.
We have been taking a restrictive stance on holding yen-denominate bonds due to ongoing negative interest rate and yield curve
control in Japan, because such policies not only make new investments in yen-denominated bonds unprofitable but also result ininsufficient diversifying effects with limited scope of interest rate fluctuations. Meanwhile, we were increasing the balance of foreign
bonds (with forex hedges), expecting relative advantage of investing in them.
Anticipated interest rate rise worldwide, however, prompted us to restrict new investments and sell those bonds from fiscal 2021
onward, significantly reducing the balance. In addition, the duration became shorter. As a result, we were able to rein in the
expansion of evaluation loss caused by an interest rate rise, and the current portfolio ensures sufficient investment capacity that leads
to future profit. In fiscal 2023, the final year of the Medium-Term Management Plan, we plan to restore the balance in anticipationof the effects of diversifying investment in stocks in the future overseas economic slowdown. Meanwhile, there are concerns that
foreign currency procurement costs will remain high and we believe that a careful response is necessary.
Foreign bonds (without forex hedges) contributed significantly to profit in fiscal 2022, partly due to the rapidly weakening yen.
Bond switching during the fiscal year has increased investment yields, and they have become assets from which we can expect stableprofit from carry trading in the future by maintaining the balance. Meanwhile, it is also anticipated that the yen will strengthen insome cases due to changes in monetary policy, and other reasons. Thus, we plan to implement risk control measures and strategic
re-balancing according to the situation, while keeping a certain amount of balance.

Since its establishment in 2014, the Financial Market Business Office has accumulated high-quality loan assets centered around
domestic and overseas project finance and overseas corporate finance, while being mindful of diversifying the portfolio. For our
portfolio by region, while focusing on loans with the final risk lying in Japan, such as loans for solar, biomass, wind power
generation, and other types of renewable energy and loans guaranteed or insured by a Japanese export credit agency, we diversify
risk across the world, including North America, Europe, and Asia/Oceania. We will continue to accumulate loan assets with a focus
on not only profitability and safety but also ESG, etc., which is attracting increasing interest in recent years. We aim for a loanbalance of ¥140.0 billion by the end of fiscal 2023, the final year of the current Medium-Term Management Plan.
We choose foreign currency procurement methods according to asset characteristics, thereby ensuring stable procurement andcoping with interest rate fluctuations in the procurement. In addition, commitment lines are set above the necessary amount ofprocurement for each period, ensuring stability in the face of sudden changes in the market environment and other contingencies.

0

Domestic and
Decreaseoverseas stocks

S ell off stocks held for strategic purposes if thenecessity of holding is not recognized.
P urchase stocks held solely for investment
purposes of which growth is expected in themedium- to long-term view.
 onsider investment to secure stable carrying andC
portfolio diversification.

Changes in Balance of Securities by Risk Category(Billions of Yen)
300

Foreign bonds (with hedges)
Alternatives, etc.

Foreign bonds (without hedges)

47(89.7)(134.7)

Fiscal 2019

Iyogin Holdings Integrated Report 2023

March 2023

1.69%
(1.54%)(1.94%)

2.14%(1.51%)(3.20%)

Changes in 10BPV*(Billions of Yen)
10.0

0.3
0.8
(99.1)(69.6)(62.0)(35.9)
Fiscal 2018

March 2022

Total Yield
1.64%(Domestic currency yield) (1.54%)(Foreign currency yield) (1.85%)+90.8

Total for the last 10 years(right axis)

Fiscal 2020

Fiscal 2021

0.3

0.6

1.3

2.0

0.3
1.7

3.6

Fiscal 2022

1.8
1.8
1.7

0

4.2

4.8

4.3

3.5

3.3

EuropeElectricity and gas
Finance
Transportation

Manufacturing
Various services
Other(March 31, 2023)<Loans + Market Investment (Securities)>

3.0

2.8

<Loans, etc.>

Mainly assets with high liquidity
Loans, etc.
86.3%

Securities
13.7%

Mainly assets with low liquidity

3.0

3.1

North America
Japan
Asia/Oceania
Other

March 2024
(Plan)

Status of Foreign Currency Investment and Procurement(100)*Changes in evaluation gain (loss) on
securities when interest rates change by
0.1%, representing the amount of interest
rate fluctuation risk in the portfolio

Yen-denominated bonds
Foreign bonds (with hedges)
Foreign bonds (without hedges)

4.0

2.0

March 2020 March 2021 March 2022 March 2023

*Including impairment loss on
cross-held shares, etc.
(approximately ¥(4.0) billion)(140.0)(35.2)

0

Repo procurement
7.6%
Long-term
Short-term
Deposits, etc.
procurement
procurement
37.4%
32.2%
22.8%
Choose foreign currency procurement methods
in line with asset composition
0

20

40

60

80

Short-term procurement is conducted for substantial short-term loans
Loans, etc.

100 (%)

Loans withmulti-currency terms

Stability gap is positive(excessive investment)

Liquidity gap is negative(excessive procurement)

Commitment
line
24.5%

Long-term
procurement
37.4%

Deposits, etc.
43.3%

Cash flow risk is guaranteed with commitment lines
0

20

40

60

80

100

120

140 (%)

0.8
1.1

March 2016 March 2017 March 2018 March 2019 March 2020 March 2021 March 2022 March 2023

Corporate Data

(300)

March 2021

+104.5

0

(200)

(30)

16.9%

100
0

6.0

(144.7)

18.9*

2.0

100

+88.1

26.7

(9.6)

8.0

+134.4

(100)

28.2

30

32.0

50.7%

10.8%

30

200

*On a book value basis

200

300

52.5%

Sustainability

Yen-denominated bonds
Domestic and overseas stocks

283.4

400

9.6%

21.6%

60

Investment

60

Notchange101.4

90Implement risk control measures and strategic rebalancing according to the situation while keeping
a certain amount to secure stable profit from carrytrading.

Alternatives,
etc.

392.1

120

Not
change- slightly
increase

Foreign bonds(without forex
hedges)(Billions of Yen)
500

Procurement

Restorebalance eep the balance as a bond including foreignKbonds as assets inversely correlated with stocks.
For foreign bonds (with forex hedges), the balanceis temporarily shrunk in anticipation of risinginterest rates. In the future, the balance is planned
to be restored gradually.

119.3

12.7%

Investment

Notchange(Billions of Yen)
150

4.1%

8.6%

Business Strategy and Plan for Realizing
the Long-Term Vision

Yendenominatedbonds
Foreign bonds(with forex
hedges)

118.0

7.9%

4.6%

140.0

135.0

117.6

120

Portfolio by Region and Industry(Financial Market Business Office)90

Realized profit/loss (= Interest and dividend income + gain (loss) related to securities)
Total profit/loss (= Periodic profit/loss + change in gain/loss on evaluation)

Investment policy(Billions of Yen)
150

Procurement

Risk category Direction

Term-end balance

Value Creation Story

Securities Performance

Investment Policy by Risk Category

Loan Balance Plan (Financial Market Business Office)Message from the Management

Policies for Loan Management and Foreign Currency Procurement

About the Iyogin Group

Investment Policy for Investing in Securities

Stability gap: Loans, etc. - (Deposits, etc. + Long-term procurement)
Liquidity gap: Loans, etc. - (Deposits, etc. + Long-term procurement + Commitment line)

Iyogin Holdings Integrated Report 2023

48

Business Strategy and Plan for Realizing the Long-Term Vision

BPR Strategies
Aim to increase productivity of the entire group by minimizing administrative and routine work andenhancing manpower available for customer interactions and planning work

As a result of taking various BPR measures, we reduced 402 administrative staff members in charge of operations (as of March 31,2023) and 37 of those in charge of loans (as of March 31, 2023) from March 31, 2018. While reducing the number of administrative
staff members by limiting hiring and natural attrition (retirement), at the same time, surplus human resources generated by the
reduction are reassigned to work in the sales field or on further headquarters-centralizing to enhance services in the digital field
through reassignment and reskilling, thereby allocating more time to problem solving for customers.
As of March 31, 2023, yearly workload at the headquarters has decreased by approximately 165 thousand hours (equivalent to 84
staff members). We will continue our efforts, with the goal of reducing yearly workload by 200 thousand hours by March 31, 2024,
the final year of the current Medium-Term Management Plan, thereby aiming to improve productivity for the entire Group to invest
human resources in the planning operations and to achieve work style reforms considering reconstruction of the head office building.

Cashless Processing

We started full-fledged introduction of the reception tablet
device AGENT in February 2019, and have completed theinstallation at all bank branches. Looking to be the bank withthe simplest administrative procedures in Japan, we have
digitized approximately 40% of reception-related
administrative work at bank branches, for example, accountopening can be completed in as little as 10 minutes by
inputting information on a tablet.
As for AGENT banking app, which has been undergoingagile development based on the concept of “Iyo Bank on Your
Palm,” we implemented new function for inheritanceprocedures in October 2022, and transfer function in May
2023. We are continuing to pursue simplification ofprocedures and convenience for our customers through theuse of digital technology.

As a cashless processing initiative, we have introduced Satto
Madoguchi (Quick Counter) at next-generation branches andlinked transactions by Satto (Quick) ATMs installed at thecounters with those by branch terminals. By centrally
managing account transactions at the counter and cash
receipt and payment transactions, we have minimized cash
handling at counters.
In addition, cash management operations at bank branches
has been outsourced to a business service company in theGroup, to abolish administrative tasks themselves. Toward therealization of cashless processing, we are promoting the
introduction of outsourced cash management operations to allbank branches within Ehime Prefecture.

<AGENT tablet><Iyo Bank on Your Palm>

Effects of BPR at Iyo Bank Branches (Administrative Workload/Number of Administrative Staff Members)

Number of Administrative Staff Members in Charge of Operations(Persons)
1,400(402)persons

1,306

300

1,026

(Persons)
450

Administrative workload

433
403

404

Number ofadministrative
staff members

396

400

1,253
1,142

Number of Administrative Staff Members in Charge of Loans(Thousandseconds)
As of200
March 31, 2023

(37)persons

350

From fiscal 2019

150

350
100

200

965

250

904
800

March 2018 March 2019 March 2020 March 2021 March 2022 March 2023 March 2024
(Plan)

50

100
0

150

March 2020 March 2021 March 2022 March 2023 March 2024
(Plan)

0

Effect of Workload Reduction at Iyo Bank Headquarters and Group Companies (Reduced Hours)

Effect of Headquarters Workload Reduction
Outsource cash
management

Iyo Bank(Ten thousand
hours)
20
16

Equivalent to approx.

As ofMarch 31, 2023

200 thousand

84 staff members

hours/year

165 thousand(165)

hours/year

thousand hours
From fiscal 2017

12

Other Measures (Renewal of New Bank Branch System)

Headquarters-centralizing measures include centrally receiving
phone calls, centrally keeping retained documents, setting up
the Administrative Work Support Center and Loan-Related
Administrative Work Support Center (centrally handles loanrelated administrative work related to loan operations of bankbranches). By expanding the scope of branch administrative
work centrally handled by the headquarters, we are reducing
administrative workload at bank branches.

In addition, new bank branch system that underwent a major
renewal and began full-fledged operation in January 2023,
has realized paperless and less operation by linking the BOC
system, which centralizes branch administrative work at theheadquarters, with RPA, and by adding Satto (Quick) ATM
function. We plan to reduce the number of terminals at bankbranches (by half) and workload by approximately 156 staff
members.

Productivity Improvement at Headquarters

49

Iyogin Holdings Integrated Report 2023

Increase productivity of the entire Group40

Inputting resources to “planning work”
March 2018 March 2019 March 2020 March 2021 March 2022 March 2023 March 2024
(Plan)

Yearly Working Hours (Per Person)(Hours)2,200Higher awareness on BPR by employees and officers
Contribute to work style reforms

2,107 2,102
2,100

2,055

2,000

2,014
1,943 1,936

1,931 1,921

186-hour reduction of yearly working hours

1,900(per person) between 2015 and 2022

1,800

0

2015

2016

2017

2018

2019

2020

*Reference: 8 hours x 245 days (365 days - annual holidays) = 1,960 hours

2021

Corporate Data

We are also working on the improvement of operational efficiency for the headquarters. In December 2017, the CoE was set up in
the General Planning Division of Iyo Bank, which has been striving to reduce workload at the headquarters mainly by using RPA toautomate operations and making various application procedures digital and paperless through groupware use.
With the transition to a holding company structure in October 2022, we have assigned one person in charge of operational
efficiency to each company this year to expand horizontally the BPR knowledge accumulated to date by Iyo Bank to all groupcompanies. By cooperating with the CoE, we are steadily executing the operational reforms centered on paperless operations
through digitization of various application procedures and promotion of mutual use of digital tools.
Going forward, we will take another step forward in our cost reduction efforts by expanding each measure to the entire Group,
including consolidating duplicated operations in the Group, subject to approval from the authorities.

RPA
BPR

8

Sustainability

Headquarters-Centralizing Measures

Cost
reduction forgenerating Reallocation
further
capacity

Business Strategy and Plan for Realizing
the Long-Term Vision

The Iyogin Business Service(IBS)

From fiscal 2017

1,000

600

<Satto Madoguchi (Quick Counter)>(Thousandseconds)
As of500
March 31, 2023

Number ofadministrative
staff members

Administrative workload

Value Creation Story

Digitization and Simplification of Administrative Work

Message from the Management

Effects of Administrative Staff Downsizing and Workload Reduction

Since the Fiscal 2015 Medium-Term Management Plan, BPR strategies have been positioned as an important task for increasing
productivity. We not only simplified administrative work processes but also grasped the reality through research on administrative
workload. We have thus carried out a fundamental review of administrative work, exploring the possibility of abolishingadministrative tasks themselves.
Bank branches have taken measures under such concepts as “digitization and simplification of administrative work,” “cashlessprocessing,” and “headquarters-centralized.” We are minimizing administrative work at bank branches by introducing AGENT
tablets, electronic contracts for business feasibility loans, and other digital tools including AGENT banking app that allows customers
to go through bank procedures via video chat. In addition, we are promoting Satto Madoguchi (Quick Counter) to reduce cash
handling, expanding the area of headquarters-centralized operations, and promoting cooperation with group companies. Our bankbranches thus are shifting their focus from administrative work to problem solving.

About the Iyogin Group

Branches Shift Focus from Administrative Work to Problem Solving

2022
(FY)

Iyogin Holdings Integrated Report 2023

50

Business Strategy and Plan for Realizing the Long-Term Vision

New Business Creation Strategies
Continuously develop businesses and operations that contribute to solving local issues and improving
sustainability through appropriate and bold risk-taking, thereby creating profit opportunities

We are proceeding with consideration and trials in several business fields based on possible issues that local regions and customers
will face, under this basic policy: “Continuously develop businesses and operations that contribute to solving local issues andimproving sustainability through appropriate and bold risk-taking, thereby creating profit opportunities.”
In February 2023, to expand the business fields of Iyogin Capital Company Limited, we newly established the “Iyogin BusinessSuccession and Growth Support Fund,” which responds to the mitigation of requirements for investment in business succeedingcompanies, etc.
Furthermore, in April 2023, we established “Iyogin Digital Solutions Co., Ltd.” as a company that operates the DX consulting
business. Its representative director was selected from among the managers. This also represents a challenge for the Group, as this is
the first time we are starting a business under the leadership of a young president.
In transitioning to a holding company structure, we have obtained approval to be classified as a “certified bank holding company,”
one of the first among regional banks nationwide, and have established a system that enables flexible and agile initiatives. In orderto make the most of this advantage, we will find ways to deepen and evolve our business through a customer-oriented approach,and readily take on challenges.

Since 2018, the Corporate Consulting Division has beenoffering the ICT consulting operations at the Iyo Bank, and has
supported more than 200 cases thus far.
We listen carefully to our customers’ issues, andcontinuously make improvement proposals with a focus on“how to streamline manual light work of each company,” andour efforts have been highly acclaimed. For instance, in 2022,
we were commended by the Cabinet Office and listed as “Anexample of distinctive initiatives by financial institutions, etc.
that contributed to regional revitalization in 2021.”
Iyogin Digital Solutions will channel the expertise we havecultivated thus far into DX consulting, and aim to provide
more advanced consulting services.

of sustainability in theregionBanking services, guarantee, investments,
credit cards, lease, asset management,
insurance, business succession, M&A,
business matching, etc.
— Current — educe risks inRprocurement and use ofenergyRevitalize throughbusiness attraction,business foundation,
tourism, etc.
Increase productivity byintroducing digitaltechnology
Appropriately secure anddevelop necessary
human resourcesIncrease sales througheffective sales(etc.)

Consideration ofCommercialization

New
company

Select an optimal
method for the
Group
Bank

Other Group
companies

Iyogin Digital Solutions Co., Ltd.

 iming to improve the sustainability of the region by contributing to the spread of the local production, local consumption
A
model for energy; in view of the region, the focus is on solar power generation, and expansion into fields such asenvironmental value trading is also possible.
As this business field requires long-term management and continuation for over 10 to 15 years, our soundness (corporate
strength and reliability) as a banking group can be utilized.

Business related totown development

 urrently considering business development that sets business creation in collaboration with local governments as a coreCbusiness field.
By aiming for the capability to internally produce solutions for various issues that differ depending on the region, we aim to bea business entity that creates new operations and businesses.

Business related tohuman resourcesS taffing business foundation already exists; the number of consultations, number of contracts concluded, and associated fee
income have been increasing significantly.
Exploring additional fields from a wide range of perspectives, such as utilization of former employees or retiring personnel incollaboration with major local companies, supporting local employment for students, and providing educational programs forthe potential labor force.

As an increasing number of companies are facing business succession issues and management issues related to growth, theimportance of the equity business is increasing in the provision of value to customers. In addition to offering funding, M&A, andbusiness succession support for investees, this fund will realize the enhancement of corporate value through hands-on support that
goes one step further than before.

<Overview of the Fund>Name

Iyogin Business Succession and Growth Support Fund Investment Business Limited Partnership

Total amount¥2,000 million

Establishment

February 20, 2023

Partners
Duration period

Iyogin Capital Company Limited (GP: General Partner)
The Iyo Bank, Ltd. (LP: Limited Partner)

Corporate Data

Business related torenewable energy

Establishment of the “Iyogin Business Succession and Growth Support Fund”

Sustainability

Business related toadvertising iming to support sales expansion of our customers by utilizing customer contact points such as the bank app and mailingA
services; a field where we can leverage our extensive reach and data analyses based on our customer base.
Currently conducting trials to measure advertising effectiveness and verify business models such as fee structures.

Iyogin Holdings Integrated Report 2023

Kazuya Ono, President and Representative Director

As the Iyogin Group considered the “expansion of business fields,” one ofits purposes for transitioning to a holding company structure, ourcompany was established with the idea that we could help customers
with their management issues such as improving operational efficiency
and digitalization.
In the same way that the Group’s core subsidiary Iyo Bank is working on
DHD, by accelerating efforts of regional customers to digitalize and realizeDX, we will help to eliminate labor shortages due to population decline,
realize the original purpose of DX which is to increase sales, and create
new businesses. Therefore, we believe we can contribute to therevitalization of the local economy.

— Vision for the future —Business Fields Under Consideration

51

Message from the President

Business Strategy and Plan for Realizing
the Long-Term Vision

Strengthening operations related
to solving increasingly evident
regional issues such as
depopulation and the need for
productivity improvement

Assumed Issues

Value Creation Story

Improvingproblem solving
Take on the challenge ofand earnings
new operations that
power
contribute to improvement

Message from the Management

Establishment of “Iyogin Digital Solutions Co., Ltd.”

About the Iyogin Group

Consideration of New Businesses

10 years

Iyogin Holdings Integrated Report 2023

52

Business Strategy and Plan for Realizing the Long-Term Vision

Plan for Branches

Plan for IT

Aim to diversify customer touch points by rebuilding channels,
including branches

Overview of Plan for IT
Review of Branch and ATM Locations(Branches)
148
150

148

Bar: Number of branches*

Line: Number of ATMs (ATMs)
700

142
140

655

130

650

635

130

600

128

550

120
0

650

134

530

527

3. Establishment of IT Governance

1. Prompt and Flexible Digital Response to the
Changing External Environment and Customer Needs

We aim for the optimization of IT investment by controlling IT
investment costs and establishing and reviewing investment
rules.

To improve customer experience (CX), we will establish anomnichannel system that offers better CX through any
channel, upgrade each channel, and develop and upgrade thereadiness for data use that creates added value.

Prompt and flexible digital
response to the changing
external environment andcustomer needs
Achieve omnichannel
coordination
Upgrade each channel
Upgrade data use

500

523

March 2018 March 2019 March 2020 March 2021 March 2022 March 2023

0

*Excluding branches within branches

2. Maintenance of a Secure, Stable, and Safe Banking System
As a foundation for credibility and trust, we will continue toensure stable operation of the core system. Systeminfrastructure will also be developed with an eye on mediumto long-term productivity improvement.

Kawanoe Branch (Kinsei Branch)
Kawanoe Branch which was newly built and opened in July
2022 offers two lobby spaces based on the purposes ofcustomers visiting the branch. In addition to improving
convenience through digitization of administrative work, ouremployees listen to customers’ issues and work to provide valuethat only people can deliver. In addition, on the second floor, a“collaboration space” has been installed with the aim of using
it for various scenes such as holding seminars and consultation
sessions, planning events, and collaboration between theemployees of the headquarters and officers and employees of
the Group. Through this, the bank and group companies work
together to solve issues of customers in the region.

Maintenance of a secure,stable, and safe banking
systemMessage from the Management

Since the Fiscal 2015 Medium-Term Management Plan, we
have been reviewing our branch locations while maintaining
customer touch points, in light of the decline in regional
population and branch foot traffic. In addition, we areworking to allocate the appropriate number of ATMs, taking
into account the rapid spread of cashless payment in recent
years and the status of use of ATMs by customers at eachlocation. We will continue to aim for optimal allocation of
branches and ATMs in line with changing customer behavioral
patterns and diversifying and sophisticated needs.

About the Iyogin Group

Optimization of Branch and ATM Locations

Aim for the establishment of IT governance that not only achieves prompt andflexible digital response to the external environment and customer needs, and but
also maintains a secure, stable, and safe banking system as well

 pgrade the core system
UDevelop systeminfrastructure

Establishment of IT governanceControl IT investment costs, establish and review investment rules

Efforts by the Iyogin Group as a Whole
Value Creation Story

Introduction of CRM Group Dashboard
 e introduced a CRM Group Dashboard in April 2023 toWstrengthen the sales capabilities of the entire Group andachieve customer-oriented business operations.
We will share corporate information held by the Group
companies* among the entire the Group, and aim tostrengthen relationship management and provide optimal
products and services. *Excluding Shikoku Alliance Securities

New Head Office Buildings
 ontact persons at each GroupC
companyTransaction status, etc. are displayed

Improvement of Coordination Among Channels
 ith the aim of analyzing and utilizing data of each channel, we are progressively developing an environment for obtainingW
attributes and behavioral data of customers of our apps and web services.
We will analyze various data and utilize them to provide optimum recommendations to customers and improve functions of ourapps and web services.
[Perspective drawing]

Collection of data

Integration of dataATM

ATM serverHP

WEB measurement tool

Analysis of data

Information host

Providing CX

ATM server

ATM advisement

ATM

Sustainability

Summary of the New Head Office Buildings
Name

New Main Building

New South Building

Total floor area

Approx. 30,000 m

2

Approx. 13,000 m

Structure

Steel construction

Steel construction

Number of floors

12 stories above ground,
1 story below ground11 stories above groundStart of theconstruction work

Summer 2026

Summer 2023

Completion of
construction

Spring 2029

Spring 2025

DesignRecommendation tool

Banner, etc.

HP

2

MCIF*

(Iyo Bank on Your Palm)(Card loan app)

App measurement tool

Via vendor

Osaka First-Class Registered Architects Office,Takenaka Corporation(Housing loan app)Utilization of data

Data
analysis toolAI

Extraction ofanalysis targets

Extraction oftargets

Push notification,
etc.

Recommendations to app
Functional improvement of app
and web services, etc.

Apps andwebservices

Corporate Data

Concept
Sustainable buildings that create richness and vitality in theregion“For our 200th anniversary of the foundation, we will
construct new head office buildings that will make regional
contribution.” evenue statusR
Negotiation
records

Business Strategy and Plan for Realizing
the Long-Term Vision

The current main building (completed in 1952) is 71 years old,
and the annex (completed in 1968) is 55 years old, and bothare deteriorating. Accordingly, we intend to rebuild them toenhance seismic performance and disaster preventionfunctions. By so doing, we will ensure safety in the event of amajor disaster and reinforce our business continuity plan (BCP)
as a financial infrastructure.
As the banking business expands, office space in the head
office became insufficient. So, part of the function of theheadquarters as well as group companies were dispersed
within the city of Matsuyama. In October last year, the Group
shifted to a holding company structure. We intend to build amore efficient and group-wide business operation system byconsolidating organizations and improving productivity, withthe rebuilding of our buildings, including the south annex.
Through the rebuilding of the head office buildings, we willconsider such initiatives as establishing an area to connect
with regional customers and using the facilities as a primary
accommodation for those who have difficulty returning homein the event of a major disaster, etc.

*Abbreviation of Marketing Customer Information File. Customer database for marketing use

53

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

54

Sustainability

Response to Climate Change:

Initiatives for TCFD Recommendations

A task force for stabilizing financial systems established under Financial Stability Board (FSB) in 2015 On
the assumption that physical impacts of climate change such as abnormal weather, and drastic shift tothe decarbonized economy may threaten the stability of financial systems, TCFD requires all companies
to disclose information in the below-mentioned manner: 1) use multiple climate scenarios, 2) evaluate
the company’s own climate-related risks and opportunities, 3) reflect the evaluation in management
strategies and risk management, and 4) comprehend their financial impacts and disclose them.

<Risks>As risks of climate change, we recognize transition mitigation risks and physical risks are recognized. It is required to take measuresfor both direct impacts on the Iyo Bank’s own business activities and indirect impacts caused by customers being affected.

Transition Risks

Physical Risks

Assumed transition risks include an increase in creditrelated expense for sectors to be subject to impacts causedby responding to strengthened climate-related regulations,such as restrictions on carbon emissions, a hike in carbon
tax, and other risks. “Electricity and gas” sector has been
selected as the target sector by evaluating the importanceof the risk with two axes, risk evaluation by sector (degreeof impact) in light of a result of consideration in “UNEP FI
Principles for Responsible Banking”, etc.; and thecomposition ratio in the Iyo Bank’s portfolio (credit
amount).

Assumed physical risks include an increase in the Iyo
Bank’s credit-related expense arising from a deteriorationin customers’ business performances and damages on
real-estate collateral with typhoons, floods, and othernatural disasters.
In addition, risks of being unable to continue businessdue to damages on the head office, branches, and otherholdings of the Iyo Bank, and increases in costs arisingfrom countermeasures and restoration are assumed.

Message from the Management*TCFD (Task Force on Climate-related Financial Disclosures)

About the Iyogin GroupIn February 2021, Iyo Bank, the core company of the Group, expressed support for the recommendations of
the Task Force on Climate-related Financial Disclosures (TCFD*) to contribute to the realization of adecarbonized society while assuming the risks that climate change poses to our customers and the Bank.
Believing that pursuing both the realization of sustainable global environment and business activities willlead to creation of new business opportunities, Iyo Bank will strengthen information disclosure related toclimate change, based on the framework of TCFD Recommendations.

<Scenario Analysis><Policy>
Under the Group Corporate Credo (Meaning of Existence) of “creating a bright and prosperous future for the region”, wehave established “Environmental Policy”, and proactively and continuously worked on reducing our environmental burdens
and supporting our customers’ environmental conservation activities.

<Structure>

2. Strategies<Opportunities>

55

Iyogin Holdings Integrated Report 2023

Results of Scenario Analysis Concerning Transition Risks

Results of Scenario Analysis Concerning Physical Risks

Strengthened regulations on carbon emissions and introduction of carbon tax

Occurrence of flood damage caused by climate change

Effect on B/S
Increase in investment
in renewable energy
facilities

Increase inborrowings

Effect on P/L
Decrease in sales

Occurrence ofcarbon costs

Increase in credit-related expense associated with the transition to the decarbonized society
Scenarios
AnalysistargetAnalysis
methodAnalysis
periodAnalysis
resultB elow 2˚C Scenario (2˚C Scenario) and Net Zero 2050 Scenario (1.5˚C Scenario)
publicized by the Network for Greening the Financial System (NGFS)A mong the Bank’s business borrowers, “electricity generation business
operators” and “gas business operators”(excluding business operators related to renewable energy)C alculate an increase in credit-related expenses by calculating the impact ofstrengthened regulations on carbon emissions and introduction of carbon tax
associated with the transition to the decarbonized society on an individualcompany basis and forecasting future financials through fiscal 2050
Until 2050
2 ˚C Scenario: A total of ¥0.08 billion increase in credit-related expense
1.5˚C Scenario: A total of ¥2.6 billion increase in credit-related expense

Financial impacts on business borrowers
Direct damage

Decrease in sales due tosuspension of operations

Damage on real-estate collateral
Impairment of collateral value

Increase in credit-related expense upon occurrence of flood damage
ScenariosR CP 2.6 Scenario (2˚C Scenario) and RCP 8.5 Scenario (4˚C Scenario)
publicized by the Intergovernmental Panel on Climate Change (IPCC)

Analysistarget

The Bank’s business borrowers

Analysis
method alculate an increase in credit-related expenses in consideration of financial
C
impacts on business borrowers and damage on real-estate collateral uponoccurrence of flood damage and damage on real-estate collateral, as well as
the probability of flood damage for each of the climate change scenarios.

Analysis
periodAnalysis
resultUntil 2050
A total of ¥4.6 billion to ¥7.5 billion increase in credit-related expense<Carbon-related Assets>

The ratio of carbon-related assets* to loans and other assets mainly based on the recommended disclosures by the TCFD
Recommendations was “43.4%” (as of the end of fiscal 2022). For your information, the ratio of the “energy” sector toloans, etc. was “3.8%” (as of the end of fiscal 2022).
We will continue to sophisticate scenario analysis and expand the sectors to be analyzed, and meanwhile, through theengagement with these sectors, we will consider providing various solutions for decarbonization as well as sustainable finance.

Corporate Data

We have proactively supported customers’ investments in renewable energy business and capital investment that would
contribute to a reduction in environmental burdens, and financially helped customers reduce greenhouse gas emissions andincrease energy efficiency. Thus, we are working on the realization of a lower-carbon society.
Also in non-financial aspects, in order to provide solutions for supporting customer’s decarbonization such as consulting
services for measures against climate change, we have started initiatives toward the development of regions that are robust
over climate change and the establishment of sustainable businesses, including the conclusion of a comprehensive
collaboration agreement with a local electric power company.

In relation to physical risks, for the Iyo Bank’s businessborrowers, we implemented the scenario analysis about
an increase in credit-related expense caused byoccurrence of flood damage which resulted in financial
impacts on business borrowers and damages on realestate collateral due to occurrence of flood damage,under “2˚C Scenario” and “4˚C Scenario” announced by
the IPCC. The analysis result is as shown below.

Sustainability

Considering responses to climate change from perspectives of both opportunities and risks,
we are proceeding with respective initiatives.

In relation to transition risks, for the Iyo Bank’s businessborrowers in the “Electricity and gas” sector, we
implemented the analysis about an increase in credit-related
expense caused by financial impacts on each businessborrower arising from the strengthened regulations oncarbon emissions and the introduction of the carbon tax
associated with the transition to the decarbonized society,under “2˚C Scenario” and “1.5˚C Scenario” announced by
the NGFS. The analysis result is as shown below.

Business Strategy and Plan for Realizing
the Long-Term Vision

While being a risk to the Iyo Bank, climate change that has significant impacts on local communities is considered as one of
the important management issues that would create new business opportunities. As it is necessary for the entire organization
to proceed with considering the response to the TCFD recommendations, we have been investigating and discussing the wayof corporate activities toward the realization of decarbonization in a cross-organizational manner, involving the management
planning divisions and the risk management divisions, etc. Matters to be discussed are submitted and reported to the Group
Sustainability Committee chaired by the President of Iyogin Holdings. The Committee deliberates the status of responses toand information disclosures about environmental issues including climate change. We have also established the system inwhich important matters are appropriately reported to the Board of Directors as necessary, and given its supervision
appropriately.

Physical Risks

Value Creation Story

1. GovernanceTransition Risks*…Calculated by applying the industry classification listed in the Ministry of the Environment’s “Practical Guidance for Decarbonization Starting from Portfolio Carbon Analysis” based on the definition of
the “energy,” “transportation,” “materials and buildings,” “agriculture, food and forestry products” sectors.

Iyogin Holdings Integrated Report 2023

56

Sustainability

Response to Climate Change~ Initiatives for TCFD Recommendations ~About the Iyogin Group

3. Risk Management

4. Benchmark and Targets<Management system for risks of climate change>

As targets related to climate change, Iyo Bank has set targets for the reduction in its own CO2

We are aware that transition risks and physical risks caused by climate change have impacts on the Iyo Bank’s businessactivities, and financial positions, etc. Going forward, we will comprehend and analyze impacts related to such risks, andconsider the establishment of a management system in the framework of integrated risk management.

In investments and loans for specified sectors that are highly likely to facilitate negative impacts on the environment andsociety including climate change, we have determined and publicized our policy of making decisions on transactions after
indicating the environmental and social risks, etc. to recognize, and taking measures in light of respective properties. In orderto mitigate or avoid such risks, we take measures in light of respective properties by checking how the customer has
responded to the risks, for example. Especially, the Group’s attitude for the initiatives has been stipulated as a rule in order tostrictly control investments and loans for the “coal-fired power generation” sector which includes risks of increasing concern
over climate change and air pollution.

<CO2 emission reduction>
Reduction target: By fiscal 2030, reducing the Iyo Bank’s CO2 emissions* by 50% compared to the level in fiscal 2013
Results of emissions and reduction
Fiscal 2013 Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022
Scope 1
(Direct emission)—

1,401 t1,337 t1,266 t1,313 tScope 2
(Indirect emission)—

7,589 t6,018 t7,700 t7,003 t

Total

PolicyCoal-fired power
generation businessCompared to other power generation methods, the coal-fired power generation emits
more greenhouse gases, and includes a risk of growing concern over climate change andair pollution. Accordingly, we will not make investments and loans for funding for the
purpose of construction of new coal-fired power plants.

Cluster bomb
manufacturing business

From a public and humanitarian perspective, we prohibit investments and loans forcompanies that manufacture cluster bombs, regardless of the purpose of funds.

12,000-29-29

10,000-42

12,592 t

8,990 t7,355 t8,966 t8,316 t

6,000
4,000

—

(28.6)%(41.6)%(28.8)%(34.0)%*Total of Scope 1 (direct emission) and Scope 2 (indirect emission) calculated in accordancewith the criteria of a regular report under the Act on Rationalizing Energy Use.

12,592

7,589

6,018

1,401

1,337

-20

-34
-50

7,700

7,003

2,000
0

(%)
0

1,266

-40
-60

6,296

1,313

Fiscal 2013 Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022 Fiscal 2030

-80
-100

Calculation of Scope 3
Scope 3Fiscal 2013 Fiscal 2019 Fiscal 2020 Fiscal 2021 Fiscal 2022

Business travel(Category 6)
Employeecommuting(Category 7)

—

553 t

225 t

189 t

308 t

—

1,381 t1,351 t1,319 t1,296 tStatus of response to Scope 3, Category 15 (Investments)
We are making trials regarding calculation of CO2 emissions (financed emissions) of the investee portfolio classified into
Category 15 (Investments) of Scope 3. Going forward, we will analyze calculation results and consider efforts for setting
reduction targets, etc., preparing for disclosure of information.

<Sustainable finance>
Target of cumulative transaction amount: ¥1,400.0 billion (including ¥700.0 billion in the environmental area)
Subject period: fiscal 2021 to fiscal 2030
Definition of “sustainable finance”: Finance that contributes to the realization of sustainable local society throughsupporting customers’ initiatives for sustainability, toward the resolution ofBusiness Strategy and Plan for Realizing
the Long-Term Vision

Palm oil/wood processing
business

Businesses that involve deforestation, such as palm oil/wood processing businesses andother businesses including deforestation may cause environmental issues due to illegal
logging, as well as infringement of rights of local citizens, and human rights issues such as
child labor. We will consider how to work on investments and loans, in full consideration ofenvironmental impacts, the presence or absence of trouble with local citizens and childlabor, and other factors.

Scope 1
Scope 2
Reduction rate (combining Scope 1 and Scope 2)

Value Creation Story

Sector(t-CO2)
14,0008,000

Results of reduction(compared to fiscal 2013)

Policies on investments and loans by sector

Message from the Management<Policies on investments and loans for specified sectors>

emissions and for sustainable finance for customers.

environmental/social issues
In order to comprehend customers’ responses to climate change and initiatives for environmental conservation, andcontribute to the extraction of management issues and resolution thereof, we added an item about environmental
consideration (business status in consideration of management conscious of climate change and environment) to assessment
items in the “business feasibility assessment”, on which the Bank has put efforts into.

Sustainability<Integration into business feasibility assessment>

Examples of subject investments and loans
Environmental area

Green loans/bonds, transition loans, and environmental private placement bonds, as well as
environmentally conscious investments and loans such as ones related to renewable energy

Social area

Private placement bonds such as “Manabiya” and “Chiiki no Mirai” supporting home towns, andSDGs private placement bonds, as well as investments and loans responding to social issues suchas loans responding to earthquake disasters

Other area

Sustainability-linked loans and positive impact finance, as well as investments and loans related tobusiness foundation and business succession
Corporate Data

Results in Fiscal 2022: ¥218.9 billion (including ¥125.1 billion in the environmental area)

57

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

58

Sustainability

Initiatives for Sustainable Growth
Reduction of CO2 Emissions through Capital Investment

Sustainable Finance

Sustainable Finance Menu:
Green loans

Financial support for customers’ sustainable management sophistication

Transition loans

Sustainability
linked loans

Cumulated transaction amount from fiscal 2021: ¥218.9 billion(including ¥125.1 billion in the environmental area)
Key sustainable finance projects

Cumulative Sustainable Finance Executed
Sustainable finance(Of which, the environmental area)(Hundreds ofmillions of yen)

14,000Transaction amount in fiscal 2022: ¥126.2 billion

Renewable energy businesses related¥70.5 billion

Sustainable finance and green bonds¥18.7 billion(including ¥64.2 billion in the environmental area)

2,189
926 609¥23.0 billion

Fiscal 2021

7,000

Environmental Management Consulting
1,251

Fiscal 2022

Fiscal 2030

Positive Impact Finance for SAIBI Gakuen
In July 2022, we started handling “positive impact finance”
in which Iyo Bank comprehensively analyzes and evaluates
the environmental, social, and economic impact of customers’
corporate activities and supports their initiatives to increase
In the same month, we concluded an agreement for
positive impact finance with the Educational Corporation
SAIBI Gakuen to build a new school building of SAIBI HighSchool as the first project.
Through this product, we are committed to supporting ourHandling of Private Placement Bonds for Work Style Reforms Started

customers in sophisticating their ESG and SDG management

In April 2023, we started to handle private placement bonds for work style reforms with the purpose of supporting customers whichmeet a certain level of financial criteria and make efforts to achieve workstyle reforms.
Through this product, we will support our customers who are working to achieve workstyle reforms, and will aim to realize asustainable local communities.

and contributing to the sustainable development of local
communities.

Project Finance for Wind Power Operation¥13.5 billion for an onshore wind power operation that
Makikawa Masaki Wind Farm LLC plans to construct in the
Makikawa district of Uwajima City, and the Masaki andMidorihei districts of Ainan Town, Minami-uwa County,
Ehime Prefecture, as an arranger and agent.
We will support initiatives to reduce CO2 emissions bysupporting customers in procuring funds for large projects infinancing techniques including project finance.

59

Iyogin Holdings Integrated Report 2023

Makikawa Masaki Wind Farm LLC

Power generation
scale
Company thatbuys electricity

25,000 kW (output control with 3,600 kW x 8
turbines)
Shikoku Electric Power Transmission & Distribution
Company, Incorporated

Sponsors

GF Corporation, JR-EAST Energy Development Co., Ltd.

Start of operation
February 1, 2026
(scheduled)
Date of conclusion
December 28, 2022
of loan agreement(Millions of yen)
15,000

Number of issues
Private Placement Bonds for Supporting
Welfare Program “Kaisha-no-Mirai”
SDGs Private Placement Bonds
Private Placement Bonds for
Supporting Home Town “Chiiki no Mirai”

12,000

9,000

6,000

10,980
9,120
1,630
4,050

1,040
1,910
1,730
3,770

Private Placement Bonds for
Supporting Home Town “Manabiya”
Environmental Private Placement
Bonds

12,30012,410

1,580

1,190

4,940

6,020

250
2,510

80
1,700

11,630
1,080
4,490
80

Fiscal 2018

2,530
Fiscal 2019

3,020
Fiscal 2020

3,420
Fiscal 2021

121

125

18

13
20
8

18

90

66
60

30

3,440
0

120

124

3,170
Fiscal 2022

040
Fiscal 201846

Private Placement Bonds for
Supporting Home Town “Manabiya”
Environmental Private Placement Bonds

140
13

70

135
12
57
2

4

2

27

30

25

30

25

27

Fiscal 2019

Fiscal 2020

Fiscal 2021

Fiscal 2022

55

2,810

3,000

Arranged amount ¥13.5 billion(Issues)150

Private Placement Bonds for Supporting
Welfare Program “Kaisha-no-Mirai”
SDGs Private Placement Bonds
Private Placement Bonds for Supporting
Home Town “Chiiki no Mirai”

37

Iyogin Holdings Integrated Report 2023

Corporate Datathe field of renewable energy by leveraging various types ofBusiness operator

AmountSustainability

Iyo Bank arranged project finance with the total amount of

Overview of the project

Business Strategy and Plan for Realizing
the Long-Term Vision

positive impact and reduce negative impact.

In September 2022, in order to meet diversifying and sophisticating
decarbonization needs of customers, Iyo Bank concluded a business matching
agreement with the Carbon Free Consulting Corporation which engages indecarbonization consulting services.
We held a “carbon neutrality seminar” to introduce the changing trends indecarbonization in Japan and overseas, the need for decarbonization
management, and specific initiatives.
In addition, the Group also provides environmental management consulting
services to our customers in cooperation with the company, and thereby supports
our customers, including manufacturers, in calculating GHG emissions,investigating governance systems, formulating reduction targets and specificmeasures, disclosing information, and taking such other measures.
The Group will contribute to the realization of sustainable local communities
through environmental management consulting for our customers.

Value Creation Story

Private placement bonds(environmental private placement bondsand SDGs private placement bonds, etc.)

Green bonds

Kawanoe Branch which was newly built and opened in July 2022 has introduceda solar power generation facility that can generate electricity of about 33 kW.
After that, in order to further reduce CO2 emissions, some electric vehicles andmotorcycles for business use were put in place, together with the portable power
feeders.
The portable power feeders are superior to engine generators in terms of noise,
ventilation, etc., and can also be expected to contribute to reduction of CO2
emissions. In the event of a disaster, portable power feeders mounted on electricvehicles can be taken to the affected area to be used as an emergency powersource. Through such ways, we will contribute to create a sustainablecommunities.
Following Kawanoe Branch, electric vehicles and portable power feeders havebeen successively introduced in Matsuyamakita Branch, Yawatahama Branch,
Uwajima Branch, Imabari Branch, and others.
The Group will continue to implement various measures to reduce CO2
emissions.

Message from the Management

Sustainable Finance Executed

Positive impact
finance

About the Iyogin Group

Supporting customers’ efforts toward sustainable management, which is of increasing social interest

60

Sustainability

Initiatives for Sustainable Growth
Revitalization of Local Economy in Cooperation with Companies in Other Industries

Our Regional Vitalization Division provides extensive support for business foundation from development of a business plan throughfinancing. With fulfilling solution menus, we solve issues customers face, and provide close support from an early stage to a growth stage.
In cooperation with administrative bodies and regional industrial support organizations, we also hold “Iyogin Future Start-up
School” (business foundation seminar) to learn a wide range of matters from the mindset during the early stage to know-how onmanagement, and “Iyogin Business Plan Competition” in which participants compete on their business plans. Thus, we have beenworking to establish an ecosystem to create new business in a region together with regional stakeholders.

With assistance from the Japan Tourism Agency, we collaborated with the ANA Group, fishery operators, and others in implementing
a demonstration experiment of “Japan’s First! Sustainable Tourism Using Farmed Tuna.” We will continue to support the discovery
and refinement of new tourism content utilizing local resources.

Grand Prix

USUi Co., Ltd.. (Niihama City, Ehime Prefecture)T he company presented “Stable Renewable Energy Business With Buoyancy of ‘Ocean,River, and Lake’ Water Used as Power Source.”They developed the wave power generation device “GOMES” in cooperation with thelocal National Institute of Technology, Niihama College, and other institutions.

“Tourist Town Development Project Using Historical Resources” in Ozu City

August 2018 February 2020
July 2020 -Support for the Creation of a New Logistics Structure through Initiatives for Mixed Loading of Freight and Passengers
As a solution to the urgent issue of “2024 Problem” in the logistics industry, or anticipated further truck driver shortage, Iyo Bank
proposed “mixed loading of freight and passengers” to the parties concerned and has been conducting a demonstration experiment.
In March 2022, we conducted the first demonstration experiment related to transportation within Ehime Prefecture (from Uwajima
City to Matsuyama City), and in November 2022, we conducted the second demonstration experiment on mutual transportation
between Ehime Prefecture and Okayama Prefecture. We will continue to propose new approaches to logistics issues, in addition to
the mixed loading of freight and passengers.

Details reation of new value by taking advantage of the punctual and high-speed trains
CPromotion of initiatives for freight transportation by rail with less environmental impact (modal shift)Initiatives for regional revitalization by connecting producers and consumers in the Prefecture[Phase 1] Demonstration experiment: From Uwajima
to Matsuyama[Phase 2] Demonstration experiment: From Uwajima
to Okayama and Okayama to Matsuyama

Details
Entered into the Collaboration Agreement among Ozu City,
Value Management Co., Ltd., NOTE (general incorporated
association), NOTE K.K., and Iyo Bank
Dispatched an employee of the bank to KITA. MANAGEMENT, aregional DMO (general incorporated association) established by
Ozu City
A total of ¥200 million Ozu town development fund set up withinvestment by Organization for Promoting Urban Development(general incorporated foundation) and Iyo Bank
“NIPPONIA HOTEL OZU CASTLE TOWN”, a distributed hotel, (22buildings with 28 rooms as of March 2023) and “OZU CASTLE
STAY” started

Tuna carving by carving girls

UwajimaStation

Sales started:
3:30 p.m.

Matsuyama
StationUwajima Station
Departure:
9:55 a.m.

Departure:
9:55 a.m.
Freight collection:
9:00 a.m.

Arrival:
11:20 a.m.
Delivery completed:
0:30 p.m.

Uwakai 10 Limited
Express

Arrival: 3:17 p.m.
Matsuyama Station
Arrival: 11:20 a.m.

Shiokaze 11
Limited Express

Departure: 0:35 p.m.
Okayama Station

Shiokaze 18
Limited Express

Departure: 0:21 p.m.

Arrival: 3:11 p.m.
Sales started:
3:30 p.m.

Revitalization of Local Economy through Crowd Funding

Iyogin Holdings Integrated Report 2023

In September 2022, we concluded “Collaboration Agreements on Regional Revitalization and Manufacturing Support” with twonational institutes of technology in Ehime Prefecture. Through the collaboration, we will “connect” the issues and needs of local
companies and governments to the institutes, with the aim of improving students’ recognition of local companies and increasing theemployment rate in the Prefecture. In addition, we will activate collaboration with students and professors to create new value anddiscover new business plans and start-up projects.

Overview of CollaborationInformation exchange and support through promotion ofindustry-academia-government collaboration
Collaboration to solve regional issues and revitalize local
communities
Support for manufacturing as well as exchange anddevelopment of human resources

Corporate Data

61

Revitalization of Local Economy by Industry-Academia-Government Collaboration

Sustainability

We formed a business tie-up with a crowd funding operator in September
2018, and started subsidiary business that support projects related to businessfoundation and regional revitalization, in commemoration of Iyo Bank’s 140th
anniversary of its foundation.
As an example of such projects, Iyo Bank consulted with Mr. Mao Onishi,
who aspired to become a handmade washi craftsman when he was a student
at Ehime University, commenced provision of support toward starting up thebusiness, including formulation of the funding plan, in collaboration with the“Kami-no-machi Museum.” Upon graduation, Mr. Onishi established hisbusiness as a washi craftsman and conducted crowd funding as a PR campaign
for his activities. In addition to reaching the target amount, he has succeededin gaining more than 40 fans.
We have supported 86 projects as of the end of March 2023, and will
support those who started or aim to start business, as well as business
operators who make efforts for regional revitalization.

Business Strategy and Plan for Realizing
the Long-Term Vision

April 2018

ANA cabin attendants take on thechallenge of pole-and-line fishing

Value Creation Story

Using historical resources such as townhouses and traditional Japanese houses remaining in a castle town in Ozu City, we have beenworking on development of a tourist town, where “the development of a community” aiming to have local citizens lead fulfilling
lives and “tourism promotion” to attract people from outside are implemented in an integrated manner. The project worked on
initiatives based on the plan for which the Tourism Promotion Prize was awarded in “The 4th Iyogin Business Plan Competition” heldin 2017. As a result, it became the first Japanese winner in the culture and tradition preservation category of “The Green
Destinations Story Awards ITB Berlin,” awarded by Green Destinations, an international certification organization in the Netherlands.
Iyo Bank is playing roles of financing, provision of information on real estates, and inviting store operators, and working toward therealization of a tourist town in cooperation with related organizations.

Time

Details ommercialization of “Uwajima Farmed Tuna FishingC
Experience Tour”
Provision of “Live Tour of Tuna Carving by Carving Girls,”
and sales of tuna products through e-commerce channels
Locally consuming locally produced “Uwajima Farmed
Tuna” at accommodation facilities in the Prefecture

Message from the Management“ The 8th Iyogin Business Plan Competition” held in March 2023
Determined seven prize winners from among 48 applicants in total

About the Iyogin Group

Revitalization of Local Communities by Business Foundation Support

Iyogin Holdings Integrated Report 2023

62

Sustainability

Initiatives for Sustainable Growth
Iyo Bank Social Welfare Fund (Public Interest Incorporated Foundation)

Under the “Agreement on Forest Creation Activities”
which was entered into with Ehime Prefecture, Ozu Cityand Forest Fund of Ehime in 2008, we are making efforts
to foster forests in four locations in Ehime Prefecture.

Due to the declining birthrate, aging population anddepopulation, the improvement of social welfare and the young
human resource development for the next generation in local
societies have become social issues. As a financial institution
responsible for the region, Iyo Bank, aiming at the realization ofsustainable society, established this fund in 1976, and has worked
on activities such as granting scholarships to high school students,
and donation of social welfare equipment to social welfare
institutions, etc. over 45 years.

Area of activities

D e t a i l s o f m a j o r a ct i vi t i e s

Area

6.58haIyo Bank Evergreen Forest in Toon

25.83haIyo Bank Evergreen Forest in Toyo

6.37haIyo Bank Evergreen Forest in Matsuyama

1.69haP lanting approx. 3,250 trees in total(contributing to approx. 76t increase in carbon sink)Periodical weeding Holding forest school

 onation to forest creation activities, etc.
D(¥1 million every fiscal year)
Disseminating information on details of activities

Iyo Bank Environment Foundation “Evergreen” (public trust)
We partly subsidize activities by organizations and individuals that are engaged in environmental preservation activities in Ehime Prefecture.
In commemoration of the 130th anniversary in business, we established the foundation in 2008, and have granted subsidies ofapprox. ¥69 million to 192 organizations and individuals in total.

Organizations and individuals who have principal locations in
Ehime Prefecture

Projects eligible
for subsidy

A wide range of activities for conserving natural environmentand biodiversity in Ehime Prefecture, and creating and developing rich environment for local society

Subsidy amount

Within ¥500,000 per activity, in principle

Trustor

The Iyo Bank, Ltd.

Trustee

Sumitomo Mitsui Trust Bank, Limited

Iyo Bank Social Welfare Fund
Donation of social welfare equipment tosocial welfare institutions, etc.
(A total of ¥191 million to 380 institutions)

Donation of subsidies for buying books
to high schools, etc.
(¥0.67 million every year to 16 schools)

Regional Cultural Activity Assistance Program
Ehime Prefecture has a distinctive traditional culture rooted in each area of Toyo, Chuyo,
and Nanyo. This program was established in 1992 to provide subsidies to part of theactivity expenses of associations which inherit “grassroots” cultural activities in theseareas and thereby contribute to the inheritance of local culture and the improvement of
the standard of living culture.
In 2018, we started to provide special subsidies to organizations affected by the heavy
in July 2018, and the total subsidies so far amounted to ¥256 million for 1,325
organizations.

Value Creation Story

OutlineEntities eligible
for subsidy

Employment subsidies for children living
in child welfare institutions, etc.
(A total of ¥28 million to 1,632 students)

Message from the Management

Iyo Bank Evergreen Forest in Ozu

 ctivities to foster forests by the Group’s officers,A
employees, and their families (volunteer)

Granting scholarships to high school
students in single or no parent families(A total of ¥511 million to 997 students)

Tennis Club/Women’s Softball Club

“PLAGIRLS from the Science Club, Ehime University
Senior High School,” a grantee in fiscal 2022

We have made efforts to improve regional competitive abilities
and promote regional advancement and revitalization throughsports, for example, by holding sports classes for children withmajor players who are active in domestic top leagues.

Business Strategy and Plan for Realizing
the Long-Term Vision

IRC New Leader Seminar
Since 1989, “IRC New Leader Seminar” has been held for young business operators. Thisseminar has been held for the purpose of fostering young business operators who willplay important roles in the next generation, and thereby contributing to sustainable
development of regional society, through provision of practical opportunities for personal
development that are helpful for management, as well as ones for mutual exchange andcreation of networks. (As of the end of March 2023, a total of 1,298 participants). The
seminar, a period of which is one year, includes lectures with prestigious lecturers, andactive opinion exchanges through group presentation.

Society for Promoting Development of Community with Forest

Financial Education Class

63

Iyogin Holdings Integrated Report 2023

SDGs Card Game
Since 2021, we have been providing menus that deepen understanding about SDGs,
which are highly compatible with initiatives toward sustainable growth of local
communities.
Anyone can easily learn “why SDGs are needed ” and “how SDGs are relevant to us”
while experiencing in a game format.
Since the launch, the menus have been offered 62 times (as of the end of March 2023)
to a wide range of age and occupational groups, including business managers andemployees, local government employees, and the general public. The games wereattended by approximately 1,300 participants, who commented, “I was able to think
about them in relation to what is happening in real life,” and “I thought it was importantto act with awareness of the three aspects of economy, environment, and society, rather
than acting only on my own goals and interests.”

Corporate Data

Since 2007, we have held “Financial Education Class” for the purpose of enablingchildren who will play important roles in the future of the region to gain correct
financial knowledge. As of the end of March 2023, a total of approx. 19,000 children
has participated in the class.
In recent years, with the implementation of new high school curriculum guidelines
and lowering the age of adulthood, it is required to build up knowledge on financial
instruments, financial troubles, and asset formation, etc. Therefore, in addition toconventional programs mainly in elementary and junior-high school, we are working
on provision of financial education for high school students who will be members ofsociety soon.

Please scan the QR code tovisit the website.

Sustainability

Iyo Bank is serving as a secretariat of this society which
was inaugurated in August 2010. Aiming to create real
forests all over a town, the society is conducting activities
to green a community by planting trees. So far, 94
companies and groups have joined the society, andapprox. 54,000 trees in total have been planted.
Also, in commemoration of the 10th anniversary, “Grow
into a forest,” a picture book to teach children theimportance of trees and forests, was produced in August
2020, and was distributed to children who participated intree-planting activities.

About the Iyogin GroupIyo Bank Evergreen Forest

Iyogin Holdings Integrated Report 2023

64

Sustainability

Strong Management Foundation (Governance)
The Group has established a Group Corporate Credo that clarifies corporate missions, the basic policy of corporate management,
and the mindset and behavior to embody them, as shown below.
Under the Group Corporate Credo, the Group has recognized corporate governance as one of our top priority management issues
and striven to reinforce and improve it, for the purpose of establishing unshakable trust of shareholders, customers, regional citizens,and our employees, and other stakeholders, etc. and achieving sustainable growth and enhancement in medium- and long-term
corporate value while fulfilling social responsibilities as a corporate group with deep roots in the region.
Based on above understanding, we have established and publicized the “Corporate Governance Guideline” which stipulates thebasic concept and framework of our corporate governance.

Under the Group Corporate Credo, the Grouphas worked to disclose information in a timely
and appropriate manner to establish trust ofcustomers, shareholders and investors, regional
citizens, and other stakeholders, and fulfill
social responsibilities as a financial group.
In order to ensure timely and appropriate
information disclosure, we have developed
necessary procedures and structures, including
intra-group reporting, roles of each division,and approval by the Board of Directors.

“Meaning of Existence”	Creating a bright and prosperous
future for the region“Management Stance”	Offering the best service andbeing worthy of people’s trust“Code of Conduct”	Rendering our best service withgratitude in our hearts

 orporate Governance GuidelineC
Please refer to our website.
(available in Japanese only)
https://www.iyogin-hd.co.jp/sustainability/guideline.html

Corporate Governance Structure

General Meeting of Shareholders
Appoint/Dismiss

Cooperate

Board of Directors

Audit and Supervisory Committee

Advisory Board

Dismiss

DirectInstruction

Group Operational Risk Administration
Committee

ReportGroup Credit Risk Administration Committee

President

Information on financial
results
Notification of disclosure
criteria

Resolution

Submission and Reporting

Corporate Planning Division(division in charge of timely disclosure)

Timelydisclosure

General Manager of the Corporate Planning Division (person in charge of handling information)

Notification

Reporting

Other divisions

Notification

Reporting

The Company’s subsidiaries(including indirect subsidiaries)

Board of Directors
We have formulated a “Skills Matrix” which is a list of the following nine items selected as knowledge, experience, and ability
required for Directors from perspectives of “skills deemed necessary for basic management activities,” “bank-specific skills,” and“skills to become increasingly important,” which consist of “Business strategies and corporate management,” “Marketing,”“Personnel affairs and talent development,” “Risk management,” “Asset management and international affairs,” “Corporate
screening,” “Digital and ICT,” “Finance and accounting,” and “Law and legal affairs.”

Composition of the Board of Directors Skills Matrix
Business strategies
and corporate
Marketingmanagement

Iwao Otsuka

Chairman

Kenji Miyoshi

President

Hiroshi Nagata

Director and Senior Managing Executive Officer

Masamichi Ito

Director and Managing Executive Officer

Personnel
Asset management
Risk
affairs and talent management
and international
development
affairs

Corporate
screening

Digital and
ICT

Finance andaccounting

Law andlegal affairs

Sales Planning
Division
Instruct, manage

Group companies

Risk Management
Division

Audit

Report, consult

Management Audit
Division

Cooperate

Audit

Other subsidiaries

Iyo Bank
Report, consult

Audit

Director (Audit and Supervisory Committee Member) (Outside)

Keiji Joko

Director (Audit and Supervisory Committee Member) (Outside)

Yoriko Noma

Director (Audit and Supervisory Committee Member) (Outside)

Major agendas and resolved matters of the Board of Directors in fiscal 2022
F ormulation of the Group Corporate Credo and basic policy of corporate management
Formulation of the Group Medium-Term Management Plan, and establishment of subsidiaries
Matters concerning purchase of shares of subsidiaries externally held and business execution such as elimination of cross-shareholdings
among subsidiaries
Matters concerning policies for shareholder returns including dividend policy and purchase of treasury stock atters required disclosure related to the Corporate Governance Code and discussion and deliberation by the Board of Directors
MDiscussion on the identification of materiality for the practice of sustainability management
Response to the spring wage negotiations
Determination of the Group’s policy regarding the sales of structured bonds, and response to COVID-19

Corporate Data

Iyo Bank subsidiaries
Iyogin Business Service, Iyogin Challenge & Smile, etc.

Iyogin Credit Guarantee, Iyogin Capital, Iyogin DC Card,
Iyogin Leasing, Iyogin Regional Economy Research Center,
Iyogin Computer Service, Shikoku Alliance Securities,
Iyogin Digital Solutions

Junko Miyoshi

Sustainability

Corporate
Personnel
Planning Division Planning Division

Accounting Auditor

AuditGroup Compliance Committee

Iyogin Holdings Integrated Report 2023

Group Management Council*The above matrix is not an exhaustive list of the knowledge and experience possessed by each Director.
*In relation to concurrent positions at other companies of Directors (including Director serving as Audit and Supervisory Committee Member), the policy is to make Directors (including
Director serving as Audit and Supervisory Committee Member) avoid concurrently serving as an officer at other listed company as much as possible so that they can appropriately fulfill
their responsibilities and roles. Concurrent positions that they serve as an officer at other listed companies are as follows.
Iwao Otsuka (Chairman): Director (Audit and Supervisory Committee Member) (Outside), Shikoku Electric Power Company, Incorporated
Yoriko Noma (Director serving as Audit and Supervisory Committee Member): Audit & Supervisory Board Member (Outside), AJIS Co., Ltd.; Director (Audit & Supervisory Board Member)(Outside), AXIS Consulting Corporation; Director (Outside), Wellco Holdings Co., Ltd

Group Management Council[Management Planning Council][Compliance Council]

65

Board of Directors

Tetsuo Takeuchi Director (Audit and Supervisory Committee Member)Management Deliberation Consult
Committee
ReportInstruct, manage

Information on facts
occurredInformation on facts
determined

Business Strategy and Plan for Realizing
the Long-Term Vision

Appoint/Dismiss

Iyogin Holdings

Appoint/
Dismiss

Iyogin Holdings (the Company)

Value Creation Story

We have adopted the system of “Company with an Audit and Supervisory Committee” for the purpose of ensuring transparency
and objectivity in management with the participation of Outside Directors with voting rights at the Board of Directors, and increasing
management efficiency by swiftly making decisions with delegation of authority. At the Iyo Bank, the core company of the Group,
has also adopted the system of “Company with an Audit and Supervisory Committee,” thereby establishing a consistent internal
control structure in the Group to strengthen audit and supervision functions.
We have also introduced the executive officer system to further enhance corporate governance by separating the management
decision making and supervisory functions from business execution to strengthen the decision-making function at the Board of
Directors.

Outline of Timely Disclosure Structure (Chart)

Message from the Management

Timely Disclosure Structure
About the Iyogin Group

Basic Concept

Iyogin Holdings Integrated Report 2023

66

Sustainability

Strong Management Foundation (Governance)
Audit and Supervisory Committee

Management Deliberation Committee
Management Deliberation Committee

Advisory Board

mmittee
d Su

ec

io

Evaluations andprovides advice on
the Group’s
management
strategies andgovernance

Au d

it an

Ex

ut

p e r vis or y C oBoard ofDirectors

e ss

Deliberations on thenomination of andcompensations for
Directors, etc. andimportant mattersregardingmanagementnD

ir e ct o rsC h a ir manAudit and Supervisory Committee

Compensation System for Officers
Total Amount of Compensations, Etc. by Segment of Director, andTotal Amount of Compensations, Etc. by Type (Fiscal 2022)

Independent Outside Directors Internal Directors
 ne third or more of Directors areO
Independent Outside Directors.
Appointment of female Directors
Enhancing audit and supervisory functions,and revitalizing the Board of Directors

Number of
persons

Total amount of compensations, etc. (Millions of Yen)
Base pay

Ratio ofperformancePerformanceNonbased portion
based
monetary
compensation compensation

Directors(excluding Directors serving as Audit andSupervisory Committee Members)

4 persons

52

31

7

12

18.4%

Directors(Audit and Supervisory Committee Members)

4 persons

21

21

—

—

—

List of Outside Directors
OutsideDirectors

Significant concurrent positions

Reasons for appointment—

YorikoNomaPartner, Miyakezaka Sogo Law Offices
Audit & Supervisory Board Member(Outside), AJIS Co., Ltd.
Director (Audit & Supervisory Board
Member) (Outside), AXIS Consulting
Corporation
Director (Outside), Wellco Holdings Co.,Ltd.

Ms. Yoriko Noma has a wealth of experience, high-level insight, and advanced
expertise on corporate legal affairs as an attorney. For the reason above, theBank has appointed her as an Outside Director in the expectation that her
appropriate supervision and advice primarily in the view of legal compliance anddiversity promotion will contribute to the improvement of corporate value of theGroup over the medium to long term.

The performance-based compensation, etc. are comprised of a short-term incentive based on the Group’s performance and a
medium-term incentive based on the qualitative evaluation of individual Directors (excluding Directors serving as Audit andSupervisory Committee Members).
An amount of the short-term incentive for each Director (excluding Directors serving as Audit and Supervisory Committee) is
calculated by multiplying a base payment amount determined with non-consolidated core business gross profit of Iyo Bank, nonconsolidated core business net income of Iyo Bank, and profit attributable to owners of parent of the Group as indicators by points
distributed according to a job position. The reason for selecting the above performance indicators is that they indicate comprehensive
earnings power in consideration of not only non-consolidated performance of Iyo Bank, but also the Group’s performance. For fiscal
2022, non-consolidated core business gross profit of Iyo Bank was ¥84,106 million, non-consolidated core business net income of
Iyo Bank was ¥33,795 million, and profit attributable to owners of parent of the Company was ¥27,899 million.
An amount of the medium-term incentive for each Director (excluding Directors serving as Audit and Supervisory Committee
Members) is calculated by multiplying a base payment amount according to a job position by the payment multiplier calculated
based on the qualitative evaluation for each fiscal year taking into account a commitment to the Medium-term Management Planand his/her own duties.

Corporate Data

Keiji
Joko

Mr. Keiji Joko held important positions in the area of public administration
including the Deputy Governor of Ehime prefecture, and has a wealth ofexperience and high-level insight on organizational operation and local public
administration. For the reason above, the Bank has appointed him as an Outside
Directors in the expectation that his appropriate supervision and advice primarily
in the view of a stronger governance structure and regional development willcontribute to the improvement of corporate value of the Group over the
medium- to long-term.

Junko
Miyoshi

Performance-based Compensation

Sustainability

Chairman, Ability Center inc.

Ms. Junko Miyoshi has been engaged in the management of Ability Center inc.
for many years, and has a wealth of experience and high-level insight on
corporate management. For the reason above, the Bank has appointed her as an
Outside Directors in the expectation that her appropriate supervision and advice
primarily in the view of business strategies, risk management, and diversity andinclusion promotion will contribute to the improvement of corporate value of theGroup over the medium- to long-term.

Business Strategy and Plan for Realizing
the Long-Term Vision

Reasons for Appointment of Outside Directors

Segment of Director

Value Creation Story

Advisory Board
We have established the Advisory Board chaired by the
Representative Director and President, and in order to ensuretransparency and objectivity of the Group’s management, further
strengthen the management base and contribute to the local
community, we have introduced external perspectives regarding
the Group’s management strategies and governance.

We annually implement the self-evaluation/analysis about effectiveness of the Board of Directors for the purpose of improving
functions of the Board of Directors to increase corporate value.
In relation to the evaluation of the Board of Directors in fiscal 2022, an anonymous survey on composition and operation of theBoard of Directors, support systems for Directors, etc. was conducted for all Directors who are members of the Board of Directors.
Survey was also conducted for members of the Management Deliberation Committee (voluntary committee to deliberate on thenomination of and compensations for Directors, etc. and other important matters) regarding composition of the Committee,
frequency of its meeting, whether or not the items it deliberates on are appropriate, etc. The survey results were reported to theBoard of Directors held in April 2023 for analysis and evaluation.
Overall evaluation confirmed that the Board of Directors functions well in general. We will make further efforts in discussion with
an awareness of capital efficiency and feedback of dialogue with investors to the Board of Directors, in light of feedback we havereceived and recent corporate governance trend. We also confirmed that the Management Deliberation Committee functions well in
general.
Based on the above results, we will continue to improve the effectiveness of the Board of Directors in order to achieve sustainablegrowth and enhancement in medium- and long-term corporate value while meeting the expectations of various stakeholders.

Message from the Management

ReportConsult

B u si n

We have established the Management Deliberation Committee as
an advisory body to the Board of Directors, to appropriately ensure
the opportunities to obtain the involvement and advice ofIndependent Outside Directors, as well as enhance objectivity andaccountability of the Board of Directors’ functions in deciding
important matters regarding management including nominations
and compensation, etc. for Representative Directors, Directors,
and Executive Officers of the Group companies. The Committee ischaired by the chairperson of the Audit and Supervisory
Committee, and the majority of its members is Independent
Outside Directors.

Evaluation of the Board of Directors
About the Iyogin GroupIn accordance with the law, Articles of Incorporation and Audit and Supervisory Committee Regulations, the Audit and Supervisory
Committee, together with the Board of Directors and the Chairman, provides a supervisory function and also audits the execution ofbusiness by Directors. In accordance with the provisions of the Companies Act, the majority of Directors (Audit and Supervisory
Committee Members) shall be Outside Directors. In selection of candidates for Directors (Audit and Supervisory Committee
Members), those who have abundant knowledge and experience are selected from various areas such as corporate management,
legal affairs, finance and academic knowledge, in a well-balanced manner.

*The above three Outside Directors satisfy the “Standards of Independence for Outside Directors of the Company” set by the Company and are determined to have no other special
relationships that might cause conflicts of interest with general shareholders. We have thus designated them as Outside Officers.
*For the standards of independence provided for by the Company, please see “Reference Documents for the General Meeting of Shareholders” of NOTICE OF CONVOCATION OF THE 1ST
ANNUAL GENERAL MEETING OF SHAREHOLDERS on our website.
https://www.iyogin-hd.co.jp/english/

67

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

68

Sustainability

Strong Management Foundation (Governance)

Board of Directors and Executive Officers(As of June 30, 2023)

Directors

Directors Serving as Audit and Supervisory Committee Members
About the Iyogin Group

e
tsid
Ou

Kenji Miyoshi

Chairman(Concurrently Chairman,
the Iyo Bank, Ltd.)
April 1976
June 2007
June 2008
June 2010
June 2011
June 2012
April 2020
April 2021
October 2022

April 1982
June 2014

Joined the Iyo Bank
Executive Officer, General Manager, the General Planning Division; General Manager, theSubsidiaries & Affiliates Department, the General Planning Division; General Manager,
the ICT Strategy Planning Department, the General Planning Division, the Bank
June 2015
Managing Executive Officer, General Manager, the General Planning Division;
General Manager, the Subsidiaries & Affiliates Department, the General Planning
Division; General Manager, the ICT Strategy Planning Department, the General
Planning Division, the Bank
June 2016
Managing Executive Officer, Deputy General Manager, the Branch Banking Group,
the BankJune 2017Managing Director, the Bank
June 2019
Senior Managing Director (Representative Director), the Bank
April 2020
President (Representative Director), the Bank (current position)
October 2022 President (Representative Director), the Company (current position)

Joined the Iyo Bank
Director, General Manager, the Human Resources Division, the Bank
Director, General Manager, the Head Office, Business Department, the BankManaging Director, General Manager, the Branch Banking Group, the Bank
Senior Managing Director (Representative Director), the Bank
President (Representative Director), the Bank
Chairman (Representative Director), the Bank
Chairman, the Bank (current position)
Chairman, the Company (current position)

Tetsuo Takeuchi

Junko Miyoshi

Director (Audit and Supervisory
Committee Member)

Director (Audit and Supervisory
Committee Member)

April 1980
June 2011
June 2015

October 1986
August 1987
October 1990
June 2016
June 2018
June 2022

June 2016
June 2020
April 2021
June 2021
June 2022

Joined the Iyo Bank
Director, General Manager, the Systems Development Division, the BankManaging Executive Officer, General Manager of the Systems Development
Division, the BankManaging Director, Chief Information Officer, the Bank
Senior Managing Director, Chief Information Officer, the Bank
Senior Managing Director, the Bank
Director (Audit and Supervisory Committee Member), the Bank
Director (Audit and Supervisory Committee Member), the Company(current position)

Joined Ability Center inc.
Representative Senior Managing Director, Ability Center inc.
President and Representative Director, Ability Center inc.
Director (Audit and Supervisory Committee Member), the Iyo Bank
Chairperson, Ability Center inc. (current position)
Director (Audit and Supervisory Committee Member), the Company(current position)

Joined the Iyo Bank
Executive Officer, General Manager, the General Planning Division; General
Manager, the Subsidiaries & Affiliates Department, the General Planning Division,
the BankJune 2019
Managing Executive Officer, General Manager, the General Planning Division;
General Manager, the Subsidiaries & Affiliates Department, the General Planning
Division, the Bank
June 2021
Managing Director, the Bank
June 2022
Senior Managing Director (Representative Director), the Bank (current position)
October 2022 Director and Senior Managing Executive Officer (Representative Director),
the Company (current position)

April 1985
June 2017
June 2019

Joined the Iyo Bank
Executive Officer, General Manager, the Hiroshima Branch, the BankManaging Executive Officer, General Manager, the Ship Finance Division, theBank
June 2021
Managing Director, the Bank (current position)
October 2022 Managing Executive Officer, the Company
June 2023
Director and Managing Executive Officer, the Company (current position)*The Group Chief Officer System has been introduced, and under the overall supervision of the Group CEO, Group Chief Officers are assigned as persons in charge of key
areas in order to promote unified and strategic initiatives across the Group, thereby building an integrated Group management control structure. Currently, the following
Group Chief Officers have been assigned.
Decisions on management plans and business execution of the entire Group*Excluding the matters to be resolved by the Board of Directors

Yoriko Noma

Director (Audit and Supervisory
Committee Member)

Director (Audit and Supervisory
Committee Member)

April 1968
April 2006
April 2008

April 1986
April 1986

Joined Ehime Prefectural Government
General Manager, the Economics and Labor Department, Ehime Prefecture
General Manager, the Agriculture, Forestry and Fisheries Department,
Ehime Prefecture
April 2010
Advisor, Ehime Prefecture
December 2010 Assistant to the Governor, Ehime Prefecture
April 2012
Deputy Governor, Ehime Prefecture
August 2014 Special Advisor, Ehime Prefecture
June 2015
Chairman, Ehime Guarantee
June 2019
Director (Audit and Supervisory Committee Member), the Iyo Bank
October 2022 Director (Audit and Supervisory Committee Member), the Company(current position)

Registered as attorney-at-law
Joined Hayakawa Sogo Law Offices (currently TOKYO-HIRAKAWA Patent/
Law Office, Cosmo Law Office)November 1992 Joined Sakura Kyodo Law Offices
January 1995 Joined Oshima Sogo Law Offices
February 1999 Partner, Miyakezaka Sogo Law Offices (current position)
June 2002
Auditor, Oracle Corporation Japan
April 2017
Director, Japan Intellectual Property Arbitration Center
June 2021
Director (Audit and Supervisory Committee Member), the Iyo Bank
October 2022 Director (Audit and Supervisory Committee Member), the Company(current position)(Significant concurrent positions) Auditor & Supervisory Board Member (Outside),
AJIS Co., Ltd.
Director (Audit & Supervisory Board Member)(Outside), AXIS Consulting Corporation
Director (Outside), Wellco Holdings Co., Ltd

Executive Officers
Sustainability

Hirohisa Senba
Managing Executive Officer, Group CRO (Concurrently Managing Director, the Iyo Bank, Ltd.)Group Chief Financial Officer (Group CFO)

Overseeing finance and accounting for the entire Group

Group Chief Strategy Officer (Group CSO)

Overseeing management plans for the entire Group

Group Chief Risk Officer (Group CRO)

Overseeing risk and compliance for the entire Group

Group Chief Credit Officer (Group CCO)

Overseeing credit screening and management for the entire Group

Group Chief Business Officer (Group CBO)

Overseeing sales plans for the entire Group

Group Chief Business Promotion Officer (Group CBPO)

Overseeing sales promotion for the entire Group

Keijiro Joko

Group Chief Information Officer (Group CIO)

Overseeing system and administrative operations for the entire Group

Executive Officer, Group CIO (Concurrently Senior Managing Executive Officer, the Iyo Bank, Ltd.; Chairman, Iyogin Computer Service Company Limited)Iyogin Holdings Integrated Report 2023

Koichi Kihara
Managing Executive Officer, Group CBPO (Concurrently Managing Director, General Manager, the Sales Promotion Group of the Iyo Bank, Ltd.)

Takashi Tokunaga
Managing Executive Officer, Group CBO (Concurrently Managing Director, General Manager, the Sales Planning Group of the Iyo Bank, Ltd.)

Iyogin Holdings Integrated Report 2023

Corporate Data

69

Roles

Keiji Joko

Business Strategy and Plan for Realizing
the Long-Term Vision

Director andManaging Executive Officer
Group CCO*(Concurrently Managing Director,
the Iyo Bank, Ltd.)

April 1987
June 2017

Group Chief Executive Officer (Group CEO)Value Creation Story

Masamichi Ito

Director andSenior Managing Executive Officer(Representative Director)
Group CFO* and CSO*(Concurrently Senior Managing Director,
the Iyo Bank, Ltd.)Group Chief Officers

e
tsid
Ou

e
tsid
Ou

Hiroshi Nagata

Message from the Management

President(Representative Director)
Group CEO*(Concurrently President [Representative
Director],
the Iyo Bank, Ltd.)

Iwao Otsuka

70Sustainability

Strong Management Foundation (Governance)
Basic Concept

Risk Management

Risk Category

The Group semiannually formulates financial plans considering the balance of investment and procurement, and examines
differences between monthly-prepared forecasts/actual results and the plan. Abnormal changes in trading in the market arechecked and reported to the Group ALM Committee every month. Thereby, the occurrence of losses caused by liquidity risks
that came to surface are prevented.

Credit risk

As a division to manage credit risks, the Risk Management Division, which is completely independent from sales promotion
divisions and credit-related divisions within the Group, is responsible for the appropriate operation of the “internal rating
system”, which underlies the management, such as design, verification, and monitoring of operation of the system. On theother hand, the credit-related divisions of Group companies conduct strict and comprehensive screening in consideration ofcustomers’ financial condition, purposes for the loan and ability to repay, ensuring independence from the sales promotion
divisions.

Operationalrisk

The Group classified operational risk into five risk categories, i.e., 1) administrative risk, 2) system risk, 3) legal risk, 4) humanerror risk, and 5) fixed asset risk, so as to comprehensively and effectively manage all of these risks. The Risk Management
Division, as a supervisor for operational risk, manages operational risk of the entire Group. Striving to identify not only risks
which came to surface but also potential ones, the Group Operational Risk Administration Committee is playing a main role inmaking the operational risk management more sophisticated.

ReputationalriskWith regard to reputational risk, we have enhanced management of various risks that are sources of the reputational risk, andare further making efforts for developing corporate culture in which people naturally comply with ethics, laws and regulations,and internal rules, etc. In addition, we have in place a system where complaints from customers, etc. are dealt with by the Risk
Management Division, promptly reported to management, and reflected in operations.

Comprehensive Risk Management Structure
The Group’s risk management framework has the following four main pillars: 1. legal observance under the Compliance Council; 2.
managing revenue-generating risk assets under the Group ALM Committee; 3. risk management that focuses on curbing credit riskby the Group Credit Risk Administration Committee; and 4. management of operational risk that should be minimized such asadministrative and system risks, under the Group Operational Risk Administration Committee.
The Group ALM Committee assesses the Group’s risk exposure by quantifying market and credit risk, aiming to put in place
optimal fund management and procurement structures, and to assure stable earnings over the medium and long term.
Additionally, the Group Credit Risk Administration Committee works to manage credit risks, design and evaluate frameworks for
the Internal Rating System, and resolve issues concerning Basel Regulations.
On the other hand, the Group Operational Risk Administration Committee is taking measures to refine operational risk
management through the formulation of organization-wide measures for important topics after identifying, assessing, andmonitoring actual operational risks.
In addition, the Group CRO is assigned to supervise risk management of the Group as a whole.

Board of Directors

Audit and Supervisory Committee

Group Management Council
Management Planning Council

Management Planning Council(Group CX Enhancement Committee)

Group Credit Risk
Group Operational Risk
Administration Committee
Administration Committee(Secretariat: Risk Management(Secretariat: Risk
Division)Management Division)

Risk Management
Division

Risk Management Division

Group Compliance
Committee(Secretariat: Risk
Management Division)

Emergency Office(Secretariat:
Corporate
Planning Division)
Risk
Corporate Management
Division(Customer
Planning
Satisfaction
Division Enhancement
Ofﬁce)

Risk Management
Division

Operational risk
Risk
Categories

Market Liquidity Credit
risk
risk
risk

Administrativerisk

Humanerror risk

Legal risk

Fixed asset
risk

System risk Cybersecurity*

Reputational
risk

Compliance

Holding company divisions, Group companies

71

Iyogin Holdings Integrated Report 2023

Business Continuity StructureGroup CEO, Group CSOGroup Emergency
OfficeI-CSIRT*1
Information gathering/analysis/

Under evaluation, security measures,normal monitoring activities, threat/situations vulnerability management

Financial Services
AgencyBank of Japan
PoliceNational Center of Incident
Readiness and Strategy for
Cybersecurity

Financials ISAC Japan*2

education/exercise/drill

Underemergency
situations

JPCERT/CC*3
Responses to incidents

Holding company divisions, Group
companies

Japanese Bankers
Association/Regional Banks
Association of Japan

Security vendor*1 CSIRT of the Group. CSIRT is a collective term of organizations which deal withmatters related to computer security.
*2 Organization which shares and analyzes information related to cybersecurity among
Japanese financial institutions.
*3 Organization which receives reports on domestic computer security incidents arisingthrough the internet, and considers countermeasures, and provides advice thereforfrom a technical perspective.

The Group has established a business continuity policy in preparation for the occurrence of emergency situations which may threaten
our business continuity, such as natural disasters, system failures, the spread of infectious diseases, and man-made disasters. Basedon this policy, we have formulated a business continuity plan.
Also, to improve effectiveness of the business continuity plan, the Group CSO is assigned as a Group supervisor and an officer incharge of the management planning division of each company as a supervisor. Under their instructions and supervision, business
continuity management activities are conducted including verification of the business continuity plan, development and continuous
improvement of the business continuity structure, and education, training, and drills.
In the event of an emergency or the possibility of an emergency, a system is in place where a Group Emergency Office headed by
the Group CEO and an Emergency Office headed by the president of each Group company will be established to conduct operations,such as to take emergency measures, collect and communicate information, and oversee management.

Iyogin Holdings Integrated Report 2023

Corporate Data*A cross-organizational body I-CSIRT including the Group companies (CSIRT of the Group, secretariat: Corporate Planning Division) is responsible for responses to cybersecurity, and asystem for early warning and emergency responses against cyberattacks has been developed.

In order to respond to the evolving threat of cyberattacks, wehave facilitated mutual cooperation and communication
among the Group companies and internal divisions. At thesame time, a cross-organizational body I-CSIRT*1 has been
established as an organization responsible for overseeing theentire Group in the event of a cybersecurity incident todevelop a system for early warning and emergency responses
against cyberattacks.
In addition to developing a management structure, we haveformulated response plans for each type of incident including
attacks using ransomware and DDoS attacks in case an
incident occurs. This response plan has been improved
continuously through drills and exercises to learn and verify
response procedures for detection, initial response,containment, eradication, and restoration.

Sustainability

Divisions
responsible foreach typeof riskmanagement

Compliance Council

Management Audit Division

Management Planning Council(Group ALM Committee)

Cybersecurity Management Structure

Business Strategy and Plan for Realizing
the Long-Term Vision

Risk Management Framework

Value Creation Story

Liquidity risk

Message from the Management

Market risk

In order to properly manage market risk and maintain the Group’s soundness and profitability, the Group has conducted
integrated management of market risk under a risk management structure centering on the Group ALM Committee. The
Group ALM Committee also coordinates basic policies on investment and procurement, Group risk management plans, andhedging strategies by analyzing the profitability structure and forecasting the market and the economic environment, in
addition to risk analysis. The Risk Management Division, set up as a supervisor independent from divisions that executetransactions and administrative divisions responsible for settlement, etc., checks the appropriateness of market transactions
dealt with by other divisions.

About the Iyogin GroupIn its daily business operations, the Group is exposed to credit risks, market risks and other risks. These risks are growing in diversity
and complexity as the relaxation of regulations progresses and our business grows ever more complex. Therefore, finding ways ofappropriately managing risk has become a vital challenge for a company.
On the other hand, for the Group, risk-taking is essential for generating revenue. Only by assuming a reasonable level of risk, it ispossible to ensure appropriate earnings. Such relation exists between risks and earnings.
Accordingly, it is necessary for the Group to set reasonable profit targets after factoring in all conceivable risks, and control therisks with appropriate measures.
Under such circumstances, the Group treats risk management as a priority issue. Each fiscal year, the Board of Directors compiles
the Group risk management plan, and makes best efforts to further strengthen the risk management system and improve the levelof risk management.

72

Sustainability

Strong Management Foundation (Governance)

Compliance

Compliance Structure
About the Iyogin Group

Measures for Overseas Loans
Board of Directors
Compliance Council(Group Management Council)

Recommends

Audit and Supervisory
Committee

Group Compliance Committee

ReportingDirects

Reporting Directs

Risk Management Division

In relation to officers, shareholders, and substantial controllingpersons, etc. of overseas corporate customers, Iyo Bank conducts
thorough investigations and verifications by checking against
respective sanction lists, and even searching past negative
information covered across the world. Furthermore, in the ship
finance with a lot of overseas corporate customers, sea routes ofvessels subject to loans are monitored to detect entry insanctioned countries in real time. Like this, the Bank has
conducted investigation and verification with advanced methods.

Message from the Management

To improve the compliance structure, we formulate a Group
compliance program for each fiscal year.
Compliance Council (Group Management Council) chairedby the President has been established, and progress in theGroup compliance program and other compliance-related
matters are reported.
In addition, for the purpose of fostering and improving
mindset for compliance, lectures on compliance are held at alllevel-based workshops, and compliance training sessions arealso held at each workplace on a regular basis.

Organizational structure for anti-money laundering

Whistle-blowing System
Iyogin Holdings, Inc.

Board ofDirectors

Iyogin Holdings, Inc.

Audit and Supervisory Committee

Reporting

The Iyo Bank, Ltd.

Instructions/Directions

Group Management Council (Compliance Council)
Instructions/Directions

ReportingGroup Compliance Committee
Instructions/Directions

Reporting

Risk Management Division Supervisors (responsible officers)
Risk Management Division(Contact for reports andconsultations)

Corporate lawyers and otherlawyers(External contact for consultation)*Information sharing is limited to the scopeto which the whistle-blower agrees.

Investigation/Correction Division
Conduct investigations andtake corrective measures incooperation with the Risk
Management Division

In order to ensure a structure to allow customers to make transactions without anxieties, and improve convenience for customers,
we have continuously verified and improved operations from a viewpoint of customers, working on management including customer
protection. For personal information, with a privacy policy and other rules developed, we are making efforts for the protection of
personal information by educating our staff on a regular basis.

Countermeasures against Money Laundering and Terrorism Funding
Based on the Act on Prevention of Transfer of Criminal Proceeds and Guidelines for Anti-Money Laundering and Combating the
Financing of Terrorism, the Group has striven to maintain and develop sound financial system by strengthening the management
structure.

Management Audit Division

Audit and Supervisory Committee

ReportingInstructions/Directions

Management Council (Management Planning Council)
ReportingInstructions/Directions

Compliance Committee
Supervisors (responsible officers)
ReportingInstructions/Directions

Compliance Division
In respective measures such as domestic/foreign exchange AML/CFT (including anti-social forces), and correspondent
management, etc. 1) Improve management structure, establish various rules, 2) Supervise and give directions to the 1stline (effectiveness measurement - reflecting in risk assessment)
Reporting
Reporting

3rd line
Verification/ Internal Audit Division
Audit

Monitoring/Warning

Operations Management Division, International Division, and other related divisions
Administrative operations related to anti-money laundering

Monitoring/Warning
Directions/Support

Directions on administrative operations

Inquiry
Sales Division

Measures for anti-money laundering in operations facing customers

Transaction Filtering/Monitoring

Joint Consideration with TSUBASA AML CenterWith personnel and supervising division responsible forcountermeasures against money laundering and terrorism
funding determined, we have established a centralized control
structure, and are taking the cross-organizational measures
under coordinated efforts in cooperation with the Group
companies and relevant divisions.

In September 2016, the Group introduced a transaction
filtering system to prevent transactions with high-riskcustomers by checking against multiple blacklists collectively.
With a transaction monitoring system introduced in October
2016, Iyo Bank established a mechanism to detect suspicioustransactions and have been appropriately operating it.

In October 2020, the AML Center was established within
TSUBASA Alliance Co., Ltd.
Aiming to advance AML measures with collective knowledgeof each bank and streamline overlapping operations, AML
Center has operated smoothly.

Sustainability

Establishment of Centralized Control Structure

Business Strategy and Plan for Realizing
the Long-Term Vision

Customer Protection (Management of customer protection, etc.)

Board ofDirectors

Instructions/Directions

Management

Information Sharing*

2nd line

Audit and Supervisory
Committee(Whistle-blowing hotline)

1st line

Whistle-blowing/Feedback

The Iyo Bank, Ltd.

Whistleblowers

Reporting

Audit

Value Creation Story

For the purpose of early detection and correction of violation of laws and regulations, etc., we are making efforts for the appropriate
operation of the whistle-blowing system.
Various contacts have been set taking into account the convenience of whistle-blowers, for example, a contact for reports andconsultations set in the Risk Management Division, a hotline for whistle-blowing set at the Audit and Supervisory Committee, andcorporate lawyers and other lawyers as external contacts for consultation.
In accordance with the Whistleblower Protection Act, we thoroughly keep the secret and prohibit disadvantageous treatment inorder to enable a whistle-blower to use the contacts and hotline without hesitation.

Corporate Data

Customer Due DiligenceAs customer due diligence Iyo Bank has been checking
customer information on a regular basis since October 2020.

73

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

74

Corporate Data

Consolidated Balance Sheet

Consolidated Statement of Income

Iyogin Holdings, Inc. and its Consolidated Subsidiaries
March 31, 2023

Iyogin Holdings, Inc. and its Consolidated Subsidiaries
For the year ended March 31, 2023

Millions of yen

Thousands of U.S.
dollars (Note 1-1)

2023

2023

¥6,796,340
77,501
684,070
3,680
1,045
92,636
1,793
10,146
845
1,100
430
885
4
80,291
9,472
30,696
7,790,940$50,897,476
580,401
5,122,968
27,5597,825
693,746
13,42775,982
6,328
8,237
3,220
6,627
29
601,295
70,935229,880
58,345,989

See Notes to Consolidated Financial Statements.

$ 497,229
203,122
19,763
108,866
404,733
61,5591,295,289

5,423
4,030
382
1,771
9,214
4,852
46,61950,546
9,621
132,462
40,49740,61230,1802,860
13,26269,00336,336349,127
378,536
72,051
992,001
303,280

11,332839
12,171
28,326426¥ 27,899

84,864
6,283
91,148212,132
3,190$ 208,934

Yen

U.S. dollars (Note 1-1)

¥89.13
89.08
9.00

$0.66
0.66
0.06

Millions of yen

Thousands of U.S.
dollars (Note 1-1)

See Notes to Consolidated Financial Statements.

Consolidated Statement of Comprehensive Income
20,00027,698483,166(3,792)
527,072
202,105
1,611
18,977
9,612
232,307149
309
759,838¥8,550,778

149,779
207,4293,618,407(28,398)
3,947,217
1,513,555
12,064142,117
71,983
1,739,736
1,115
2,314
5,690,391$64,036,381

Iyogin Holdings, Inc. and its Consolidated Subsidiaries
For the year ended March 31, 2023

ProfitOther comprehensive income (Note 4-1)
Valuation difference on available-for-sale securities
Net deferred gains (losses) on derivatives under hedge accounting
Remeasurements of defined benefit plans
Comprehensive income
Comprehensive income attributable to:
Owners of parent
Noncontrolling interests

2023

2023

¥28,326
12,723
11,625458
639¥41,050$212,132
95,28187,0593,429
4,785$307,421¥40,671
378$304,583
2,830

Sustainability

Net assets
Common stock
Authorized — 600,000,000 shares
Issued — 313,408,831 shares
Capital surplus
Retained earnings
Treasury stock
Total stockholders’ equity
Valuation difference on available-for-sale securities
Net deferred gains (losses) on derivatives under hedge accounting
Land revaluation excess (Note 2-7)
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Stock acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

Per share of common stock (yen and U.S. dollars):
Basic net income
Diluted net income
Dividends¥ 66,395
27,123
2,639
14,53754,0448,220
172,960

Business Strategy and Plan for Realizing
the Long-Term Vision

LIABILITIES AND NET ASSETS
Liabilities
Deposits (Note 2-5)
Payables under securities lending transactions (Note 2-5)
Borrowed money (Note 2-5)
Foreign exchange
Borrowed money from trust account
Other liabilities
Accrued employees’ bonuses
Net defined benefit liability
Reserve for losses on repayment of dormant bank accounts
Reserve for contingent losses
Reverse for share-based payments
Provision for dismantling costs of fixed assets
Reserve under the special laws
Deferred tax liabilities
Deferred taxes on revaluation excess (Note 2-7)
Acceptances and guarantees
Total liabilities

EXPENSESInterest expense:
Interest on deposits
Interest on borrowings and rediscounts
Interest on payables under repurchase agreements
Interest on payables under securities lending transactions
Other interest expense
Fees and commissions
Other operating expenses
General and administrative expenses (Note 3-1)
Other expenses (Notes 3-2)
Total expenses
Income before income taxes
Income taxes
Current
Deferred
Total taxes
ProfitProfit attributable to noncontrolling interests
Profit attributable to owners of parent

2023

Value Creation Story$10,238,006
375,084
41,983
3,684
49,77911,181,592
39,723,799(264,375)
302,606
220,107995,813534,711
88,182
313,480
2,007
229,880$64,036,381

2023

Message from the Management¥1,367,081
50,085
5,606
492
6,647
1,493,078
5,304,319(35,302)40,40729,391
132,971
71,40011,77541,859268
30,696¥8,550,778

INCOMEInterest and dividend income:Interest on loans and discounts
Interest and dividends on securities
Other interest income
Fees and commissions
Other operating income
Other income
Total income

Thousands of U.S.
dollars (Note 1-1)

About the Iyogin GroupASSETSCash and due from banks
Cash collateral provided for securities borrowed
Monetary claims purchased
Trading account securities
Money held in trust
Securities (Notes 2-1, 2-3, 2-5 and 2-9)
Loans and bills discounted (Notes 2-3, 2-4, 2-5 and 2-6)
Reserve for loan losses
Foreign exchange (Note 2-3 and 2-4)
Lease receivables and investment assets
Other assets (Note 2-3 and 2-5)
Tangible fixed assets (Note 2-8)
Intangible fixed assets
Net defined benefit asset
Deferred tax assets
Customers’ liabilities for acceptances and guarantees
Total assets

Millions of yen

See Notes to Consolidated Financial Statements.
Corporate Data75

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

76

Corporate Data

Consolidated Statement of Changes in Net Assets
Iyogin Holdings, Inc. and its Consolidated Subsidiaries
For the year ended March 31, 2023

Millions of yen

Millions of yen

Accumulated other comprehensive income

Stockholders’ equity
CapitalsurplusRetainedearnings¥20,948¥20,289¥468,487

(948)

948

Treasurystock¥(4,871)¥504,854(6,098)
135
7,041

—
(5,051)
27,899(6,098)147(293)(5,051)
27,89911(7,335)(8,251)
80

—
80

5,533

5,533

(948)

7,408

14,678

1,078

22,217¥20,000¥27,698¥483,166¥(3,792)¥527,072

Thousands of U.S. dollars (Note 1-1)
Stockholders’ equity$156,878(7,099)Retainedearnings$151,943 $3,508,477

Treasurystock(37,826)
208,934(45,667)
1,011
52,72982(54,931)
61,791(61,791)
599

—
599

41,436(7,099)$149,779

55,478

Total
stockholders’equity—(37,826)
208,934(45,667)
1,100(2,194)

41,436109,922$207,429 $3,618,407

8,073

166,382$(28,398) $3,947,217¥1,152¥19,058¥8,973¥219,616

Stockacquisition Noncontrollinginterests
rights¥208¥ 7,119

Total net
assets¥731,798(5,051)
27,899(6,098)
147
(293)
80
5,533
11,673

458

(80)

639

12,690(58)(6,809)5,822

11,673

458

(80)

639

12,690(58)(6,809)28,039¥202,105¥1,611¥18,977¥9,612¥232,307

¥149

¥

309

¥759,838

Thousands of U.S. dollars (Note 1-1)
Accumulated other comprehensive income$(36,478) $3,780,828

7,099¥190,431

Total accumulated
other comprehensive
incomeFor the year ended March 31, 2023

Net deferred
Valuation gains (losses)
difference on on derivatives
Landavailable-for- under hedge revaluation
sale securities accounting
excessBalance at the beginning of
the accounting period$1,426,128
Changes during the accounting period
Changes by share transfer
Dividends
Profit attributable to owners of parent
Purchase of treasury stock
Disposal of treasury stock
Cancellation of treasury stockTransfer from retained earnings tocapital surplus
Reversal of land revaluation excess
Purchase of shares of consolidated
subsidiaries
Changes in items other thanstockholders’ equity, net
87,418
Total changes during
the accounting period
87,418
Balance at the endof the accounting period$1,513,555$ 8,627$142,724

Remeasurements ofdefinedbenefit plans

Total accumulated
other comprehensive
income$67,198 $1,644,694

Stockacquisition Noncontrollinginterests
rights$1,557

Total net
assets$ 53,313 $5,480,401(37,826)
208,934(45,667)
1,100(2,194)599
41,436
3,429

(599)

4,785

95,034(434)(50,992)

43,600

3,429

(599)

4,785

95,034(434)(50,992)

209,982$12,064$142,117$71,983 $1,739,736$1,115$ 2,314 $5,690,391

Business Strategy and Plan for Realizing
the Long-Term Vision

Balance at the beginning of
the accounting period
Changes during the accounting period
Changes by share transfer
Dividends
Profit attributable to owners of parent
Purchase of treasury stock
Disposal of treasury stock
Cancellation of treasury stockTransfer from retained earnings tocapital surplus
Reversal of land revaluation excess
Purchase of shares of consolidated
subsidiaries
Changes in items other thanstockholders’ equity, net
Total changes during
the accounting period
Balance at the endof the accounting period

Capitalsurplus

Balance at the beginning of
the accounting period
Changes during the accounting period
Changes by share transfer
Dividends
Profit attributable to owners of parent
Purchase of treasury stock
Disposal of treasury stock
Cancellation of treasury stockTransfer from retained earnings tocapital surplus
Reversal of land revaluation excess
Purchase of shares of consolidated
subsidiaries
Changes in items other thanstockholders’ equity, net
Total changes during
the accounting period
Balance at the endof the accounting period

Remeasurements ofdefinedbenefit plans

Value Creation Story

For the year ended March 31, 2023

Commonstock

For the year ended March 31, 2023

Net deferred
Valuation gains (losses)
difference on on derivatives
Landavailable-for- under hedge revaluation
sale securities accounting
excessMessage from the Management

8,251

Total
stockholders’equityAbout the Iyogin GroupFor the year ended March 31, 2023

Balance at the beginning of
the accounting period
Changes during the accounting period
Changes by share transfer
Dividends
Profit attributable to owners of parent
Purchase of treasury stock
Disposal of treasury stock
Cancellation of treasury stockTransfer from retained earnings tocapital surplus
Reversal of land revaluation excess
Purchase of shares of consolidated
subsidiaries
Changes in items other thanstockholders’ equity, net
Total changes during
the accounting period
Balance at the endof the accounting period

Commonstock

Sustainability
Corporate Data

77

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

78

Corporate Data

Consolidated Statement of Cash Flows

Notes to Consolidated Financial Statements

Iyogin Holdings, Inc. and its Consolidated Subsidiaries
For the year ended March 31, 2023

Iyogin Holdings, Inc. and its Consolidated Subsidiaries
For the year ended March 31, 2023

Iyogin Holdings Integrated Report 2023$

303,280
45,9895,234(17,209)82(30,075)(4,238)(2,471)
1,632
119
6,627
7
(720,122)
155,934
277
322(210,716)
2,478(1,927,072)
1,274,724(496,008)
1,677
4,508
(375,084)(610,911)(467,288)(217,898)
13,802
4,493
3,669
733,348(125,672)(34,801)(2,681,322)(80,244)(2,761,574)(1,524,202)
1,711,722
55,726(857)
60(2,691)28(5,715)
234,070(11,414,678)
12,819,006
417,329(6,418)449(20,152)
209(42,799)
1,752,939

97(50)(5,051)(2)(6,098)
0

726
(374)
(37,826)(14)(45,667)
0(1,699)(12,804)(12,723)(95,888)32(147,455)
1,512,259¥ 1,364,804

239(1,104,283)
11,325,237$ 10,220,954(Basis of Presenting Consolidated Financial Statements)
1 Scope of consolidation(1) Principles of consolidation
The consolidated financial statements include the accounts of theCompany and the following 17 consolidated subsidiaries (the“Group”).
• The Iyo Bank Limited• The Iyogin Credit Guaranty Company Limited• The Iyogin Business Service Company Limited• Iyogin Capital Company Limited(2) The consolidated financial statements excluded the following
subsidiaries.
• Iyogin-Ehime University Originated Venture Support Fund Investment
Business Limited Partnership• Iyo Evergreen Business Succession Support Fund II Investment
Business Limited Partnership• Iyo Venture Fund VII Investment Business Limited Partnership• Iyogin Business Succession and Growth Support Fund Investment
Business Limited Partnership
These subsidiaries are excluded from the scope of consolidation
because their assets, ordinary income, net income, retained earnings
and accumulated other comprehensive income were immaterial to theconsolidated financial statements.
No unconsolidated subsidiary is accounted for by the equity
method.
These subsidiaries are excluded from the scope of the equity
method because its net income and retained earnings are immaterial
to the consolidated financial statements.

2 Affiliated companies not accounted for by the equity
methodThe consolidated financial statements exclude the following affiliatedcompanies.
•	Iyogin-Ehime University Originated Venture Support Fund Investment
Business Limited Partnership•	Iyo Evergreen Business Succession Support Fund II Investment
Business Limited Partnership• Iyo Venture Fund VII Investment Business Limited Partnership•	Iyogin Business Succession and Growth Support Fund Investment
Business Limited Partnership

Iyogin Holdings Integrated Report 2023

Corporate Data

79

40,497
6,141
699(2,298)11(4,016)
(566)
(330)
218
16
885
1
(96,158)
20,82237
43(28,137)331(257,322)
170,214(66,232)224
602(50,085)(81,575)(62,397)(29,096)
1,843
600
490
97,924(16,781)(4,647)(358,037)(10,715)(368,753)

Sustainability

See Notes to Consolidated Financial Statements.

¥

Business Strategy and Plan for Realizing
the Long-Term Vision

Foreign currency translation adjustments
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of year
Cash and cash equivalents at the end of year (Note 6-1)

2023

• Iyogin Venture Fund Corporation Limited IV• Iyogin Venture Fund Corporation Limited V• Iyogin Venture Fund Corporation Limited VI• Iyo Evergreen Sixtiary Industrialization Support Fund Investment
Business Limited Partnership• Iyo Evergreen Agriculture Support Fund Investment Business Limited
Partnership• Iyo Evergreen Agriculture Support Fund II Investment Business
Limited Partnership• Iyo Evergreen Business Succession Support Fund Investment Business
Limited Partnership• Iyogin Regional Economy Research Center, Inc.
• Iyogin DC Card Co., Ltd.
• Iyogin Challenge & Smile Co., Ltd.
• Iyogin Leasing Company Limited• Iyogin Computer Service Company Limited• Shikoku Alliance Securities Co., Ltd.
(Change in Scope of Consolidation)
In accordance with the Company’s incorporation, The Iyo Bank,
Ltd. (the “Iyo Bank”) became a wholly owned subsidiary, and allshares held by Iyo Bank in The Iyogin Credit Guarantee Company
Limited, Iyogin Capital Company Limited, Iyogin Regional Economy
Research Center, Inc., Iyogin DC Card Co., Ltd., Iyogin Leasing
Company Limited, Iyogin Computer Service Company Limited, andShikoku Alliance Securities Co., Ltd. were acquired using the method
in which a dividend in kind is received from Iyo Bank. Therefore, Iyo
Bank and the consolidated subsidiaries of Iyo Bank were and will be
included in the scope of consolidation from the current consolidated
fiscal year. As a result, the number of consolidated subsidiaries in the
consolidated fiscal year ended March 31, 2023, was 17.

Value Creation Story

Cash flows from financing activities
Proceeds from share issuance to noncontrolling stockholders
Repayments to noncontrolling shareholders
Cash dividends paid
Cash dividends paid to noncontrolling stockholders
Purchases of treasury stock
Proceeds from sales of treasury stock
Payments from changes in ownership interests in subsidiaries that do not result in change in scopeof consolidation
Net cash provided by (used in) financing activities2023

1-1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL
STATEMENTS
The accompanying consolidated financial statements have been
prepared in accordance with the provisions set forth in the Financial
Instruments and Exchange Act and its related accounting regulations
and in conformity with accounting principles generally accepted inJapan (“Japanese GAAP”), which are different in certain respects as toapplication and disclosure requirements from International Financial
Reporting Standards.
The accompanying consolidated financial statements havebeen restructured and translated into English with certain expandeddisclosures from the consolidated financial statements of Iyogin
Holdings, Inc. (the “Company”) prepared in accordance withJapanese GAAP and filed with the appropriate Local Finance Bureauof the Ministry of Finance as required by the Financial Instruments
and Exchange Act. Some supplementary information included in
the statutory Japanese language consolidated financial statements,
but not required for fair presentation, is not presented in theaccompanying consolidated financial statements.
Japanese yen amounts are rounded down to the nearest million.
Translations of the Japanese yen amounts into U.S. dollar amounts
were included solely for the convenience of readers outside Japan,
using the prevailing exchange rate at March 31, 2023, which was¥133.53 to U.S. $1.00. The translations should not be construed as
representations that the Japanese yen amounts have been, could havebeen or could in the future be converted into U.S. dollars at this or
any other rate of exchange.
Under Japanese laws and regulations, including the Companies
Act (the “Act”), the entire amount paid for new shares is required
to be designated as common stock. However, a company may, by
a resolution of the Board of Directors, designate an amount notexceeding one half of the price of the new shares as additional paid-in
capital, which is included in capital surplus.
Under the Act and the Banking Law, in cases in which a dividend
distribution of surplus is made, the smaller of an amount equal to
20% of the dividend or the excess, if any, of 100% of common
stock over the total of additional paid-in capital and legal earnings
reserve must be set aside as additional paid-in capital or legal earnings
reserve. Legal earnings reserve is included in retained earnings in theaccompanying consolidated balance sheets.
Under the Act, legal earnings reserve and additional paid-in capitalcan be used to eliminate or reduce a deficit or can be capitalized by aresolution of the stockholders’ meeting. Additional paid-in capital andlegal earnings reserve may not be distributed as dividends. Under the
Act and the Banking Law, however, by resolution of the stockholders’meeting, all additional paid-in capital and all legal earnings reserve
may be transferred to other capital surplus and retained earnings,
respectively, which are potentially available for dividends.
The maximum amount that the Company can distribute as
dividends is calculated based on the unconsolidated financial
statements of the Company in accordance with Japanese laws andregulations.

Message from the Management

Cash flows from investing activities
Purchases of securities
Proceeds from sales of securities
Proceeds from maturities of securities
Increase in money held in trust
Decrease in money held in trust
Purchases of tangible fixed assets
Proceeds from sales of tangible fixed assets
Purchases of intangible fixed assets
Net cash provided by (used in) investing activities

Thousands of U.S.
dollars (Note 1-1)

About the Iyogin Group

Cash flows from operating activities
Income before income taxes
Depreciation
Impairment losses
Increase (decrease) in reserve for loan losses
Increase (decrease) in accrued employees’ bonuses
Decrease (increase) in net defined benefit asset
Increase (decrease) in net defined benefit liability
Increase (decrease) in reserve for losses on repayment of dormant bank accounts
Increase (decrease) in reserve for contingent losses
Increase (decrease) in reserve for share-based payments
Increase (decrease) in provision for dismantling costs of fixed assets
Increase (decrease) in reserve under special laws
Interest and dividend income
Interest expense
Securities losses (gains), net
Money in trust losses (gains), net
Foreign exchange losses (gains), net
Losses (gains) on disposal of tangible fixed assets, net
Net changes in loans and bills discounted
Net changes in deposits
Net changes in borrowed money (excluding subordinated borrowings)
Net changes in due from banks
Net changes in call loans
Net decrease (increase) in cash collateral provided for securities borrowed
Net changes in call money
Net changes in payables under securities lending transactions
Net changes in foreign exchange assets
Net changes in foreign exchange liabilities
Net changes in lease receivables and investment assets
Net increase (decrease) in borrowed money from trust accountInterest income received
Interest expense paid
Other
Subtotal
Income taxes paid
Net cash provided by (used in) operating activities

Millions of yen

80Corporate Data

These Companies are excluded from the scope of the equity
method because their net income and retained earnings are
immaterial to the consolidated financial statements.

Iyogin Holdings Integrated Report 2023

(12) Accounting method for retirement benefits
In calculating retirement benefit obligations of consolidated banking
subsidiary, the benefit formula basis is used to attribute the projectedamount of retirement benefits to periods up to the end of the current
fiscal year. Prior service cost and actuarial differences are amortized asfollows:
Prior service cost:
Prior service cost is amortized using the straight-line method overa certain number of years (10 years) within the average remaining
service years of employees at the time of recognition.
Actuarial differences:
Actuarial differences are amortized on a pro-rata basis using thestraight-line method over a certain number of years (10 years) within
the average remaining service years of employees from the fiscal year
following the respective fiscal year of recognition.
Some consolidated subsidiaries use a simplified method to
calculate net defined benefit liability and retirement benefit cost.
This simplified method assumes these subsidiaries’ retirement benefit
obligations to be equivalent to the benefits that would be payable
upon the voluntary retirement of all employees at the fiscal year-end
to calculate net defined benefit liability and retirement benefit cost.
(13) Foreign currency translations
Foreign currency assets and liabilities and the accounts of overseas
branches of consolidated banking subsidiary are translated into yen
at the rates prevailing at the consolidated balance sheet date. The
Company and the other consolidated subsidiaries’ foreign currency(16) Cash flow statements
In preparing the consolidated statements of cash flows, cash on handand deposits with the Bank of Japan are considered to be cash andcash equivalents.

Iyogin Holdings Integrated Report 2023

Corporate Data

81(6) Accrued employees’ bonuses
Accrued employees’ bonuses are provided for the future payment of
employees’ bonuses based on the estimated amounts of the future
payments that are attributed to the current fiscal year.

(11) Reserve under the special laws
Reserve under the special laws is provided for contingent liabilities
from financial instruments and exchange. This is a reserve pursuant to
Article 46-5 of the Financial Instruments and Exchange Act and Article
175 of Cabinet Office Ordinance on the Financial Instruments Businessto indemnify losses incurred in connection with the purchase and saleof securities and derivatives and other financial related transactions.

(15) Significant hedge accounting methods① Hedge interest rate risk
		In order to hedge the interest rate risk associated with various
financial assets and liabilities, Consolidated banking subsidiary
applies the deferred hedge accounting method stipulated in
JICPA Industry-specific Committees Guidance No. 24, March 17,2022, “Treatment for Accounting and Auditing of Applicationof Accounting Standard for Financial Instruments in the Banking
Industry.” The effectiveness of hedging is assessed for (i) eachidentified group of hedged items, such as deposits, loans andsimilar instruments and (ii) the corresponding group of hedging
instruments, such as interest rate swaps, in the same maturity
bucket.
② Hedge against fluctuation in foreign exchange rates
		For certain assets and liabilities, Consolidated banking subsidiary
apply the exceptional treatment permitted for interest rate swaps.
IYO Bank applies the deferred method of hedge accounting tohedge foreign exchange risk associated with various foreign
currency denominated monetary assets and liabilities as stipulated
in JICPA Industry-specific Committees Guidance No. 25, October
8, 2020, “Treatment for Accounting and Auditing of Accounting
for Foreign Currency Transactions in the Banking Industry.” Theeffectiveness of the currency swap transactions, exchange swap
transactions and similar transactions that hedge the foreignexchange risk of monetary assets and liabilities denominated inforeign currencies is assessed based on a comparison of the foreign
currency positions of the hedged monetary assets and liabilities
and the hedging instruments.
			Consolidated banking subsidiary also applies fair value hedge
accounting to portfolio hedges of the foreign exchange risk
associated with foreign currency denominated available-for-salesecurities (other than bonds) identified as hedged items in advanceas long as the amount of spot and forward foreign exchange
contracts payable exceeds the acquisition costs of the hedged
securities in foreign currency.

Sustainability(4) Tangible and intangible fixed assets and lease assets①	Tangible and intangible fixed assets are generally stated at cost,less the accumulated depreciation.
			
Depreciation of tangible fixed assets, except for lease assets,of the Group is recorded using the declining balance method.
However, buildings acquired after April 1, 1998 and accompanying
facilities and structures acquired on or after April 1, 2016 aredepreciated using the straight-line method. The estimated useful
lives of these assets are about 15 – 40 years for buildings andabout 5 – 10 years for equipment.
(Changes in Accounting Estimates)(Changes in Useful Life)The buildings of head office, annex, south annex (the “current
head office, etc.”), building accessories and structure owned by our
subsidiary Iyo Bank , have been depreciated over a period of 3 – 50
years. In August 2022, however, the construction of two new head
office buildings and the dismantlement of the current head office,etc., were decided, and the useful lives of the tangible fixed assets
related to the current head office, etc., have been shortened andchanged into the future. As a result, ordinary income and income
before income taxes decreased by 458 million yen for the current
consolidated fiscal year.

(10) Provision for dismantling costs of fixed assets
As provision for the dismantling costs of fixed assets has been
provided at the amount expected to be incurred in the future for
expenses associated with the dismantling of the head office, annex,
and south annex of our subsidiary Iyo Bank.

Business Strategy and Plan for Realizing
the Long-Term Vision(3) Derivatives and hedge accounting
Derivative transactions are valued at fair value with changes in fairvalue included in current income.

(9) Reserve for share-based payments
Reserve for share-based payments is provided for the estimatedamount of share benefit obligations at the end of the current fiscal
year in order to prepare for delivery of the company’s shares to thecompany’s directors and the Iyo Bank’s directors (excluding the audit
committee members) and executive officers under the internal sharedelivery regulations.

(14) Recognition of significant revenue and expenses① Recognition of revenue from contracts with customers
	Revenue from contracts with customers is received primarily as
consideration for the provision of services incidental to, among
other services, deposit and lending services, exchange services
and securities-related services. Revenue is recognized when
the promised goods or services are transferred to the customer
through the provision of services to customers in an amountthat reflects the consideration to which the Group expects to beentitled in exchange for those goods or services.
② Recognition of revenue related to finance lease transactions
		Revenue and cost of sales are recognized upon the receipt of leasecharges.
③ Recognition of revenue related to operating lease transactions
		Lease charges corresponding to lease periods are recognized on
the basis of monthly lease charges to be received under lease
contracts.

Value Creation Story(2) Securities①	Held-to-maturity debt securities are stated at amortized cost by thestraight-line method. Available-for-sale securities with available fairmarket values are stated at fair market value. Realized gains andlosses on the sale of such securities are computed using moving
average cost. Note that, however, equity and other securities
without fair market value are stated at cost using the moving
average cost. Unrealized gains and losses on these securities arereported, net of applicable income taxes, as a separate componentof net assets.
②	Securities included in the money held in the trust account aretreated in the same manner as the securities mentioned above.

(8) Reserve for contingent losses
Reserve for contingent losses is maintained to provide against possible
losses from contingencies which are not covered by other specificreserves. The amount of reserve is based on an estimate of theamount possible future losses.

assets and liabilities are translated into yen at the rate prevailing attheir respective balance sheet dates.

Message from the Management

4 Significant accounting policies(1) Trading account securities
Trading account securities of the Company and its consolidated
subsidiaries are stated at fair market value. Gains and losses realizedon the disposal and unrealized gains and losses from market value
fluctuations of these securities are recognized as gains and losses in
the period of the change. Realized gains and losses on the sale ofsuch trading account securities are computed using moving averagecost.

(5) Reserve for possible loan losses
The consolidated banking subsidiary write off loans and makeprovisions for possible loan losses. For loans to insolvent customers
who are undergoing bankruptcy or other collection proceedings or
who are in a similar financial condition, the reserve for possible loan
losses is provided in the full amount of such loans, excluding amounts
written off and the portion that is estimated to be recoverable due tothe existence of security interests or guarantees. For the unsecured
and unguaranteed portions of loans to customers not in the above
circumstances but for who there is a high probability of becoming
so, the reserve for possible loan losses is provided for the estimatedunrecoverable amounts determined after an evaluation of thecustomer’s overall financial condition.
For loans, other than to insolvent customers mentioned above,that have been restructured due to the impact of the COVID-19
or for debtors in specific industries that are highly affected by the
COVID-19, an allowance is provided for the amount of claims, net ofthe expected amount of recoveries from the disposable security andguarantees, multiplied by a certain ratio of the remaining amount.
With regard to other receivables, the consolidated banking
subsidiary principally posts estimated losses for the next 1 year or
the estimated losses for the next 3 years. The estimated losses arecalculated based on actual average loan loss ratios for certain 1 yearor 3 years periods with necessary adjustments.
Assessments and classifications are made by each businessand credit supervision department and are audited by the Credit
Administration Department, an independent department. The reservefor possible loan losses is provided based on such procedures.
The estimated unrecoverable portions of loans to insolvent
customers who are undergoing bankruptcy or other collection
proceedings or who are in a similar financial condition are written
off. The estimated unrecoverable amounts are determined after
excluding amounts considered recoverable due to the existence of
security interests or guarantees. As of March 31, 2023, the estimatedunrecoverable amounts were ¥14,023 million ($105,017 thousand).
The consolidated subsidiaries write off loans and make provisions
for possible loan losses based on the actual rate of loan losses in
the past. However, unrecoverable amounts of loans to customers
who have a high probability of becoming bankrupt are separately
estimated and a reserve for possible loan losses is provided based on
those estimations.

(7) Reserve for losses on repayment of dormant bank accounts
Reserve for losses on repayment of dormant bank accounts is provided
in connection with inactive bank accounts the balances of whichhave been derecognized as liabilities. The reserve is provided for the
possible future demands on claims of withdrawal from these accounts
in an amount based on historical reimbursement experience.

About the Iyogin Group

3 The fiscal year of consolidated subsidiaries
The consolidated financial statements include the accounts of 7
consolidated subsidiaries with fiscal years that end December 31.
Appropriate adjustments are made for significant transactions
during the period from December 31 to March 31, the date of theconsolidated financial statements.
All significant intercompany balances, transactions and unrealized
profits and losses included in assets and liabilities are eliminated.

②	Depreciation for intangible fixed assets, except for lease assets, ofthe Group is recorded using the straight-line method. Internal use
software costs of the Group are depreciated using the straight-line
method over the estimated useful life of mainly five years.
③	Both tangible and intangible lease assets under finance leases
that are not deemed to transfer ownership of the lease property
to the lessee are depreciated using the straight-line method overthe lease term with zero residual value. In cases in which there isa residual value guarantee in the contract, the residual value is theguaranteed value. In other cases, it is deemed to be zero.

82Corporate Data

(2) Shares of the Company held by the trust① Shares of the Company held by the trust are recorded as treasury
stock in net assets at the book value in the Company.
② The book value of the trust at March 31, 2023 was ¥693 million($5,189 thousand).
③ The number of shares of the Company held by the Trust at March
31, 2023 was 1,052 thousand shares.

(Notes to Consolidated Balance Sheet)
2-1. STOCKS AND INVESTMENTS IN UNCONSOLIDATEDSUBSIDIARIES AND AFFILIATES
Stocks in unconsolidated subsidiaries and affiliates amounted to ¥100
million ($748 thousand) at March 31, 2023.
Investments in unconsolidated subsidiaries and affiliates amounted
to ¥1,548 million ($11,592 thousand) at March 31, 2023.
2-2. SECURITIES RECEIVED IN CASH SECURED BOND LENDING
TRANSACTIONS
Securities received in cash secured bond lending transactions thatare entitled to sale or (re)pledge were ¥49,902 million ($373,713
thousand) at March 31, 2023.
2-3. LOANS AND BILLS DISCOUNTED
The amounts of loans disclosed under the Banking Act and the Act
on Emergency Measures for the Revitalization of Financial Functions
are as described below. These loans include corporate bonds recorded
under “Securities” (limited to corporate bonds for which the paymentof principal and interest is wholly or partially guaranteed and whichwere issued through the private placement of securities as defined in
Article 2, Paragraph 3 of the Financial Instruments and Exchange Act),loans and foreign exchange, accrued interest, suspense payments andBankrupt and quasi-bankrupt loans are loans to debtors who aresubject to bankruptcy, corporate reorganization or rehabilitationor other similar proceedings and other debtors in serious financial
difficulties.
Doubtful loans are loans to debtors who have not gonebankrupt but whose financial position and operating results have sodeteriorated that it is unlikely that the principal and interest on theloans will be recovered under the contract, excluding bankrupt andquasi-bankrupt loans.
Loans overdue three months or more are loans whose principal
and/or interest payments have been past due for three months or
more, excluding bankrupt and quasi-bankrupt loans and doubtful
loans.
Restructured loans are loans that have been restructured to grantcertain concessions favorable to the debtors, such as reduced interest
rates or the deferral or waiver of interest and/or principal payments
to support or financially rehabilitate such debtors, excluding bankrupt
and quasi-bankrupt loans, doubtful loans and loans overdue threemonths or more.
Normal loans are loans that do not fall under the categories ofbankrupt and quasi-bankrupt loans, doubtful loans, loans overdue
three months or more or restructured loans, and in which the debtors
have no problem with their financial position or operating results.
The above amounts of loans are before the deduction of reserve
for loan losses.

2-4. COMMERCIAL BILLS
Bills discounted are accounted for as financing transactions inaccordance with JICPA Industry-specific Committees Guidance No.
24, March 17, 2022, “Treatment for Accounting and Auditing ofApplication of Accounting Standard for Financial Instruments in the
Banking Industry.” although the Bank has the right to sell or pledge
them without restrictions. The total face value of commercial bills andpurchased foreign exchange bills obtained as a result of discounting
was ¥13,312 million ($99,692 thousand) at March 31, 2023.

2023$3,479,944
5,290,256$8,770,208

The above pledged assets secure the following liabilities:

Deposits
Payables under securities
lending transactions
Borrowed money

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ 25,880

2023$ 193,814

77,501
671,241

580,401
5,026,892

In addition to the above, assets pledged as collateral fortransactions such as exchange settlement transactions and others
were as follows:

Securities
Other assets

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ 403
35,0002023$ 3,018
262,113

Other assets above mentioned were as follows:

Initial margins of futures
markets
Cash collateral paid forfinancial instruments
Guarantees
Security deposits

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ 6,5082023$ 48,738

28,568

213,944

69
330

516
2,471

2-6. COMMITMENT LINES
Commitment line agreements related to loans are agreements which
oblige the Company and its consolidated subsidiaries to lend funds
up to certain limits agreed to in advance. The Company and its
consolidated subsidiaries will lend the funds upon the request of an
obligor to draw down the funds under the loan agreement as long as
there is no breach of the various terms and conditions stipulated in therelevant loan agreement. The unused commitment balances related tothese loan agreements at March 31, 2023 amounted to ¥1,302,850
million ($9,756,983 thousand) . Of these amounts, ¥1,134,197
million ($8,493,948 thousand) as of March 31, 2023, related to loans
in which the term of the agreement was one year or less or in which
unconditional cancellation of the agreement was allowed at any time.
In many cases, the term of the loan agreement runs its course
without the loan ever being drawn down. Therefore, unused loan
commitments do not necessarily affect future cash flows.
Conditions are included in certain loan agreements which allow
the Company and its consolidated subsidiaries either to decline
the request for a loan draw-down or to reduce the agreed limit
when there is cause to do so, such as when there is a change in thefinancial condition of the obligor or when it is necessary to protect theCompany’s or a consolidated subsidiary’s credit. The Company and its
consolidated subsidiaries take various measures to protect their credit,including having the obligor pledge collateral in the form of realestate, securities, etc., on signing the loan agreement or in accordancewith the Company and its consolidated subsidiaries’ establishedIyogin Holdings Integrated Report 2023

Corporate Data

Iyogin Holdings Integrated Report 2023

(1)Overview of transactions
The trust acquires shares of the Company using funds contributed by
the Company.
In accordance with internal share delivery policies set forth by the
Board of Directors of the Company and the Iyo Bank, The Company
and the Iyo Bank grant points to these directors (excluding audit
committee members) and executive officers. At the time of retirement,
shares of the Company and money will be delivered in accordancewith the points through the trust.

2023
24,795523,313
187,426
19,493
167,924735,550
41,225,791$41,961,342$

2023¥ 464,677
706,408¥1,171,086

Sustainability

83(Additional Information)
The share-based payment program using the trust
The Company and the Iyo Bank have introduced a share-based
payment program using a trust for these directors (excluding audit
committee members) and executive officers with the aim of raisingawareness of contribution to the Group’s medium to long-term
performance and enhancement of its corporate value.

2023
3,311
69,87825,027
2,603
22,423
98,2185,504,880¥5,603,098¥

Securities
Loans
Total

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

Business Strategy and Plan for Realizing
the Long-Term Vision(Accounting Standards Not Yet Adopted)*Accounting Standard for Current Income Taxes (ASBJ Statement No.
27, October 28, 2022)*Accounting Standard for Presentation of Comprehensive Income(ASBJ Statement No. 25, October 28, 2022)*Implementation Guidance on Tax Effect Accounting (ASBJ Guidance
No. 28, October 28, 2022)

3 The impact of the adoption of the accounting standards andguidance being evaluated.

Bankrupt and quasi-bankrupt loans
Doubtful loans
Substandard loans
Loans overdue three months or more
Restructured loans
Subtotal
Normal loans
Total

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2-5. ASSETS PLEDGED
Assets pledged as collateral were as follows:

Value Creation Story(Changes in Accounting Policies)(Application of Implementation Guidance on AccountingStandard for Fair Value Measurement)
The “Implementation Guidance on Accounting Standard for Fair Value
Measurement” (ASBJ Guidance No. 31, June 17, 2021, hereinafterreferred to as “Fair Value Accounting Standards”) was adopted fromthe beginning of the current consolidated fiscal year, and the new
accounting policy set forth in Fair Value Accounting Standards will beapplied into the future in accordance with the transitional treatment
set forth in Fair Value Accounting Standards Paragraph 27-2. Thereis no effect on the consolidated financial statements in the current
consolidated fiscal year.

2 Effective date
The standards and guidance are effective from the beginning of the
fiscal year ending March 31, 2025.

customers’ liabilities for acceptances and guarantees recorded under“Other assets,” as well as securities if the Bank lent such securities
which are required to be disclosed in the notes to its consolidatedbalance sheet (they are limited to loans for use or lending under rental
contract).

Message from the Management(18) Per share data
Net income per share is based on the weighted average numberof shares of common stock outstanding during the year, excluding
treasury stock. Diluted net income per share reflects the potential
dilution that could occur if stock options were exercised. Diluted
net income per share of common stock assumes the full exercise ofoutstanding warrants at the time of issuance.
Cash dividends per share shown in the accompanying
consolidated statements of income represent dividends declared as
applicable to the respective year.

1 Overview
The standards and guidance determine the classification of current
income taxes when taxed on other comprehensive income and thetreatment of tax effects related to the sale of subsidiary shares, etc.,
when the group taxation regime is applied.

About the Iyogin Group(17)Significant Accounting Estimates
Reserve for loan losses①	Carrying amounts were ¥35,302 million ($264,375 thousand) at
March 31,2023.
		 (Note) The amount includes ¥3,663 million ($27,432 thousand) at
March 31,2023, reflecting the effects of the COVID-19.
②	Information on the nature of significant accounting estimates for
identified items
		 (a) Method in making the accounting estimates
For the calculation of Reserve for loan losses, See (5) Reservefor possible loan losses of “4 Significant accounting policies. “		 (b) Key assumptions used in making the accounting estimates
The main assumption is “Credit risk of loans in determining
debtor classification.” “Credit risk of loans in determining
debtor classification” was determined by evaluating therepayment capacity of each debtor based on its financial
condition, cash flow, profitability, etc.
In addition, for loans that have been restructured dueto the impact of the COVID-19 or for debtors in specificindustries that are highly affected by the COVID-19, it was
highly assumed to have a deterioration in their future financial
condition, cash flow, profitability, etc. than other debtors.
		 (c) The effect on the next year’s financial statements
Changes for the original assumption due to the inflection in theperformance of individual debtors or the impact of the spreadof the COVID-19 could effect on reserve for loan losses of theconsolidated financial statements for the following fiscal year.

84

Corporate Datainternal procedures for confirming an obligor’s financial condition,etc., at regular intervals.

2-9. GUARANTEE OBLIGATIONS
Guarantee obligations for private placement bonds in securities
in accordance with the Article 2, Paragraph 3 of the Financial
Instruments and Exchange Act amounted to ¥57,505 million ($430,652
thousand) at March 31, 2023.

(Notes to Consolidated Statement of Income)3-1. GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses included salaries and allowancesin the amount of ¥21,293 million ($159,462 thousand) at March 31,
2023.

Loans written off
Securities written off

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ 19
4,110

2023
$ 142
30,779¥16,298446
16,745(5,119)$122,054
3,340
125,402(38,335)

11,62587,059(8,071)
8,731
659
(201)

(60,443)
65,386
4,935(1,505)

458

3,429

3,239
(2,319)920(280)

24,256(17,366)
6,889(2,096)

639

4,785

¥12,723$ 95,281

Shares issued
Common stock
Total
Treasury stock
Common stock
Total

323,775
323,775——

10,366
10,366

313,408
313,408

6,962
6,962

8,579
8,579

10,570
10,570

4,971
4,971

1 The decrease in number of shares of stock issued was due to the cancellation of treasury stock (10,366 thousand shares).
2 The increase in number of shares of treasury stock was due to the purchase of treasury stock by market (8,577 thousand shares) and thepurchase of fractional shares (1 thousand shares).
3 The decrease in number of shares of treasury stock was due to the cancellation of treasury stock (10,570 thousand shares), the delivery of sharesof the Company through the Trust (133 thousand shares) and the exercise of stock acquisition rights (69 thousand shares).
4 The number of shares of treasury stock at the end of the current fiscal year includes the Company’s shares held by the Trust for the share-based
payment system (1,052 thousand shares).

5-2. Stock acquisition rights and own stock acquisition rights
Stock acquisition rights and own stock acquisition rights in the year ended March 31, 2023 were as follows:

Division

The
Company
Total

Details of stockacquisition rights

Type of shares
to be issued

2023
Number of shares subject to stock acquisition rights
Closing balance
BeginningThousands of U.S.
balance
Increase
Decrease
Closing balance Millions of yen dollars (Note 1-1)

Stock acquisition rights
as stock options

—

149

1,115

—

149

1,115

5-3. Dividends
The following dividends were paid in the year ended March 31, 2023.
The Company was established through a solo share transfer on October 3, 2022. The following dividends were resolved by the Directors’ meetingof the Iyo Bank, a wholly owned subsidiary.

Date of resolution

Type of shares

Directors’ meeting of the Iyo
Bank held on May 13, 2022
Directors’ meeting of the Iyo
Bank held on November 11, 2022

Common stockof the Iyo Bank
Common stockof the Iyo Bank

2023
Amount of dividends
Thousands of U.S.
Millions of yen dollars (Note 1-1)

Cash dividends per share
U.S. dollars
Yen(Note 1-1)

Record date

Effective date

March 31, 2022

June 9, 2022

¥2,543$19,044

¥8.00

$0.05

¥2,507$18,774¥8.00$0.05 September 30, 2022 December 9, 2022

1.The total amount of dividends on common stock resolved at the Directors’ meeting held on May 13, 2022 includes ¥9 million ($67 thousand) in
dividends to the Bank’s shares held by the Trust for the share-based payment system.
2.The total amount of dividends on common stock resolved at the Directors’ meeting held on November 11, 2022 includes ¥8 million ($59
thousand) in dividends to the Bank’s shares held by the Trust for the share-based payment system.
Dividends whose record date is attributable to the year ended March 31, 2023 but which became effective after March 31, 2023

Date of resolution

Commonstock

Amount of dividends
Thousands of U.S.
Millions of yen dollars (Note 1-1)

¥2,785$20,856

Source ofdividends
Retainedearnings

Cash dividends per share
U.S. dollars
Yen(Note 1-1)

¥9.00

Record date

Effective date

$0.06 March 31, 2023 June 8, 2023
Sustainability

Directors’ meeting held on
May 12, 2023

Type ofsharesBusiness Strategy and Plan for Realizing
the Long-Term Vision

3-2. OTHER EXPENSES
Other expenses consisted of the following:2023

Number of shares at the end of
the accounting period

Value Creation Story

2-10. MONEY TRUSTS TO BE INDEMNIFIED
The principal amount of money trusts to be indemnified by theCompany and its consolidated subsidiaries was ¥1,045 million($7,825 thousand) at March 31, 2023.

2023

Number of shares at the beginningof the accounting period(Thousands)
2023
Increase in number of shares
Decrease in number of shares
during the accounting period
during the accounting period

Message from the Management

2-8. TANGIBLE FIXED ASSETS
Accumulated depreciation of tangible fixed assets at March 31, 2023
amounted to ¥56,828 million ($425,582 thousand) . The amounts
that were directly offset against acquisition costs as of March 31,
2023 was ¥8,186 million ($61,304 thousand) .

Valuation difference on available-forsale securities
Incurred during the period
Reclassification adjustments
Before tax effect adjustments
Tax effectValuation difference on available-forsale securities
Net deferred gains (losses) on derivatives under hedge accounting
Incurred during the period
Reclassification adjustments
Before tax effect adjustments
Tax effectNet deferred gains (losses) on derivatives under hedge accounting
Remeasurements of defined benefit
plans
Incurred during the period
Reclassification adjustments
Before tax effect adjustments
Tax effectRemeasurements of defined benefit
plans
The total amount of other comprehensive income

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

(Notes to Consolidated Statement of Changes in Net Assets)
5-1. Type and number of shares issued and treasury stock
Type and number of shares issued and treasury stock in the year ended March 31, 2023 were as follows:
About the Iyogin Group

2-7. LAND REVALUATION EXCESSIn accordance with the Revaluation Act of Land Properties, theconsolidated banking subsidiary revalued land used in the ordinary
course of business as of March 31, 1998. The revaluation excess, netof deferred taxes, is shown as a separate component of net assets.
The current market value of the revalued land was lower than therevalued amount by ¥12,680 million ($94,959 thousand) at March 31,
2023.

(Notes to Consolidated Statement of Comprehensive Income)
4-1. RECLASSIFICATION ADJUSTMENTS AND THE RELATEDTAX EFFECTS CONCERNING OTHER COMPREHENSIVEINCOMEThe total amount of dividends on common stock includes ¥9 million ($67 thousand) in dividends to the Company’s shares held by the Trust for theshare-based payment system.

Corporate Data

85

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

86

Corporate Data

2023

2023

¥1,367,081$10,238,006(2,276)(17,044)¥1,364,804$10,220,954(2) Operating Leases
Future lease payment payables and receivables under noncancelable
operating leases were as follows:
As lessee

2023
¥115
154
¥270

2023
$ 861
1,153
$2,022As lessor
Millions of yen

2023
Due within one year
Due after one year
Total

¥31
56
¥87

Thousands of
U.S. dollars(Note 1-1)

2023
$232
419
$651

87

Iyogin Holdings Integrated Report 2023

Book value(1) Monetary claims purchased(2) Trading account securities
Trading securities(3) Money held in trust(4) Securities (*1)
Available-for-sale securities(5) Loans and bills discounted
Reserve for loan losses (*2)
Total Assets(1) Deposits(2) Negotiable certificates of deposit(3) Borrowed money
Total Liabilities
Derivative Transactions (*3)
Derivative transactions to which hedge accounting
is not applied
Derivative transactions to which hedge accounting
is applied (*4)
Total Derivative Transactions¥5,606

Millions of yen
2023
Fair value

¥

5,606

Thousands of U.S. dollars (Note 1-1)
2023
Book value
Fair value
Difference

Difference

¥

—

$

41,983 $41,983$—

3,684
49,7793,684
49,779———(535,265)$(535,265)$(9,758)—(17,089)$(26,847)

492
6,647

492
6,647

—
—

1,471,020
5,304,319(33,841)
5,270,478¥6,754,244¥6,167,148
629,191
684,070¥7,480,410

1,471,020
5,199,004—

5,199,004¥6,682,770¥6,165,845
629,191
681,787¥7,476,824(71,474)¥(71,474)¥ (1,303)—(2,282)¥ (3,585)

11,016,400 11,016,400
39,723,799 38,935,100(253,433)
39,470,366 38,935,100$50,582,221 $50,046,955$46,185,486 $46,175,728
4,711,982
4,711,982
5,122,968
5,105,871$56,020,444 $55,993,589¥(1,179)¥(1,179)¥—$(8,829) $(8,829)$—(24,008)¥(25,188)¥(24,008)(25,188)

¥

—
—

$

(179,794)(188,631) $(179,794)(188,631)—$—(*1) S ecurities include investment trusts for which the market value is deemed to be the base value pussuant to the Implementation Guidance on AccountingStandard for Fair Value Measurement Paragraph 24-3 and 24-9 (ASBJ Guidance No. 31, June 17, 2021)(*2) General and specific reserves for loan losses relevant to loans and bills discounted are excluded.
(*3) Derivative transactions recorded in other assets and liabilities are presented as a lump sum. Net claims and debts that arise from derivative transactions
are presented on a net basis.
(*4) Derivative transactions to which hedge accounting is applied are interest rate swaps, etc., designated as hedging instruments to offset market fluctuationsof loans and bills discounted in hedged items. The Bank uses mainly deferred hedges. The Bank applies the Practical Solution on the Treatment of Hedge
Accounting for Financial Instruments that Reference LIBOR (PITF No. 40, March 17, 2022) to these hedging relationships.
(*5) Immaterial items are omitted.

Note i. Consolidated balance sheet amounts of equity and other securities without fair market value and investments in partnerships, etc., aredescribed below and are not included in “Available-for-sale securities” of the fair market value information on financial instruments.

Equity and other securities without fair market value (*1) (*2)
Investments in partnerships, etc. (*3)

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥13,748
8,310

2023$102,958
62,233(*1) E quity and other securities without fair market value include unlisted stocks, which are not included in the disclosure of fair value in accordance with
Paragraph 5 of the Implementation Guidance on Disclosures about Fair Value of Financial Instruments (ASBJ Guidance No. 19, March 31, 2020).
(*2) A n impairment loss of ¥163 million was recorded for unlisted stocks during the current fiscal year.
(*3) Investments in partnerships, etc., include mainly silent partnerships and investment partnerships. These items are not included in the disclosure of fairvalue in accordance with Paragraph 24-16 of the Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No. 31,
June 17, 2021).

Iyogin Holdings Integrated Report 2023

Corporate Data

(2) Descriptions and risks of financial instruments
The financial assets of the Group consist mainly of loans to customers,
which are subject to default risk. Also, the Group holds securities
that are mainly stocks, bonds and mutual funds for investment,
management or trading purposes. They are subject to the issuer’s

2 Fair values of financial instruments
The table below summarizes book values, fair values and any differences between them. Equity and other securities without fair market value andinvestments in partnerships, etc., were excluded from the table (see Note i). Notes are omitted for cash and due from banks, call loans and bills
bought, receivables under resale agreements, cash collateral provided for securities borrowed, call money and bills sold, payables under repurchaseagreements and payables under securities lending transactions because the fair market values of these items approximate the corresponding bookvalues due to their short-term settlement.

Sustainability(Notes to Financial Instruments)
1 Financial instruments(1) Policy on financial instruments
The Group engage mainly in the financial services business andprovide lending services and leasing services. Accordingly, the Groupholds financial assets and liabilities that are subject to interest rate
fluctuations and undertakes asset and liability management (ALM) inorder to curb any unfavorable impact from interest rate fluctuations.
The Group also engages in derivative transactions as part of its ALM.

② Market risk management
In order to properly manage market risk and maintain theGroup’s soundness and profitability, the Group has established acomprehensive risk management structure set forth by the GroupALM Committee. The Group ALM Committee uses various measures
such as the gap method, market value analysis, periodic income/loss simulation and the VaR method to control risk. The Group ALM
Committee also coordinates risk management plans and hedging
strategies by analyzing the profitability structure and forecasting
the market and the economic environment. RMD, set up as anindependent supervisor, evaluates the appropriateness of market
transactions dealt with by other divisions.
The Group sets limits on the quantity of risk that may beundertaken in its “Risk Management Plan,” which is developed by the
Board of Directors biannually. RMD monitors compliance with the planand reports to the Board of Directors on a monthly basis.
(Quantitative information on market risk)
The Group measures market risk based on the VaR method. The
variance-covariance model (holding period: 120 business days;
confidence interval: 99.9%; and historical observation period: 1,200
business days) is applied in the measurement of VaR.

(4) Supplementary explanation of matters related to fair valuesof financial instruments and others
As the fair values of financial instruments are estimated on certain
assumptions, the values may differ when other assumptions areapplied.

Business Strategy and Plan for Realizing
the Long-Term Vision

Due within one year
Due after one year
Total

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

③ Liquidity risk management
The liquidity risk management of the Group is conducted throughasset-liability management (ALM) and the duration of funds procured
with consideration for the market environment.

Value Creation Story(Notes to Lease Transactions)
1. LEASE TRANSACTIONS(1) Finance Leases
Finance leases that do not transfer ownership of the lease assets①	Details of lease assets(i) Tangible fixed assets
Automatic teller machines(ii) Intangible fixed assets
Not applicable② The method used to depreciate for lease assets
See “SIGNIFICANT ACCOUNTING POLICIES - Tangible and intangible
fixed assets and lease assets.”(3) Risk management system for financial products① Credit risk management
The Group prescribes its credit risk management policy in its “Group
Risk Management Plan,” which is issued by the Board of Directors
biannually. In particular, the Group diversifies credit risk by ensuringthat credit granted is not overconcentrated in certain customers,
groups or industries. The Group periodically analyzes and evaluates
the credit conditions classified by internal ratings, business area
and industry. The Group strives to optimize its credit portfolio bypromoting effective credit risk management. Feedback regarding
credit risk management is reported to the Board of Directors on aregular basis.
The Group manages each customer’ credit in compliancewith its “Internal Rating System,” part of the Group’s credit risk
management. The Risk Management Division (RMD), which iscompletely independent from other banking business divisions, is
responsible for planning and administrating the internal rating systemand conducting, coordinating and monitoring the internal ratings.
The Loan Group is responsible for supervising the individual credit
granted and examining each customers’ finances, purpose for theloan and ability to repay. The group is independent from the businesspromotion group. The assets are initially assessed by each branch andthen by the head office, followed by a validation by RMD, which isalso responsible for the formulation of the assessment standards.

The major market risks for the Group are equity risk and interest
rate risk. Financial instruments affected by interest rate risk are loans
and bills discounted, available-for-sale securities, deposits, borrowed
money, interest swap transactions and interest rate cap derivativetransactions. At March 31, 2023, the quantity of market risk (expectedloss), which included equity risk and interest rate risk, amounted to¥180.5 billion ($1,351 million).
The Group confirms the validity of the measurement model by
biannually performing back-testing which compares VaR with actualfluctuations in profit and loss during the observation period. However,
VaR, the quantity of market risk which is statistically measured withhistorical market fluctuations, may not reflect drastic changes in themarket.

Message from the Management

Cash and due from banks in the balance
sheetsDue from banks, except for deposits
withthe Bank of Japan
Cash and cash equivalents in thestatements of cash flows

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

credit risk, interest rate risk and market price risk.
The foreign currency denominated financial assets and liabilities
are subject to foreign currency risk. The Bank uses currency swaps tomanage the risk.
The Group’s derivative transactions include interest rate swaps.
The Group applies hedge accounting to the interest on loans tohedge interest rate risks regarding the interest rate swaps as hedge
instruments. The effectiveness is ensured by maintaining a balance ofhedge instruments that does not exceed the balance of the hedged
items, which are grouped by incidence and remaining period.
Other transactions not qualifying for hedge accounting expose
the Group to foreign exchange and interest rate risks.

About the Iyogin Group(Notes to Consolidated Statement of Cash Flows)
6-1. CASH AND CASH EQUIVALENTS
Cash and cash equivalents in the consolidated statements of cash
flows included due from banks, except for deposits with the Bank ofJapan, as follows:88Corporate Data

Note ii. Expected redemption of monetary claims and securities with maturities

1-3 years¥1,312,899
50,085
4,121
75,078—75,078—16,021
24,744
1,194,416¥2,636,601¥———333,909—333,90963,50046,70936,927
991,022¥1,324,931¥———
150,402—150,402
3,500
68,596
8,974
790,742¥941,144¥———96,344—
96,34410,00062,7072,894
561,789¥658,134

7-10 years¥———
145,305—
145,305
16,00065,766628
594,231¥739,537$ 9,832,239
375,084
30,861
562,255—
562,255—
119,980
185,306
8,944,926$19,745,383$———2,500,629—
2,500,629
475,548
349,801
276,544
7,421,717$9,922,347$———
1,126,353—
1,126,353
26,211
513,712
67,2055,921,830$7,048,183$———721,515—
721,51574,889469,609
21,6734,207,211$4,928,735$———
1,088,182—
1,088,182
119,823
492,518
4,703
4,450,168$5,538,358

¥—
—
1,488
135,362—
135,362—
38,39910,2001,072,138¥1,208,989

Over 10 years$——
11,143
1,013,719—
1,013,719—
287,568
76,387
8,029,191$9,054,062

(*) Loans and bills discounted on which full repayment is not expected from debtors such as bankrupt obligors, substantially bankrupt obligors and intensively
controlled obligors amounted to ¥72,249 million ($541,069 thousand) at March 31, 2023, and loans and bills with no maturities amounted to ¥27,729
million ($207,661 thousand) at March 31, 2023.

Within 1 year

Deposits (*)
Negotiable certificates of deposit
Payables under securities lending transactions
Borrowed money
Total¥5,815,968
629,191
77,501
289,643¥6,812,304¥322,472——
104,694¥427,167¥ 25,578——
287,279¥312,858¥1,096——769¥1,866

7-10 years¥2,032——641¥2,673

Within 1 year

Thousands of U.S. dollars (Note 1-1)2023
1-3 years
3-5 years
5-7 years
7-10 years$43,555,515
4,711,982
580,401
2,169,123$51,017,029$2,414,977——
784,048$3,199,033$191,552——
2,151,419$2,342,979$8,207——
5,759$13,974¥—¥1,484¥1,484

$—

$—

492
—

—
—

—
1,746

492
1,746

3,684
—

—
—

17,716——372,371408,681¥799,262

84,602
296,454
43,503
172
188,118¥612,851——
58,084—976¥62,292

102,319
296,454
101,587
372,543597,776¥1,474,406

132,674——
2,788,669
3,060,593$5,985,636

633,580
2,220,130
325,791
1,288
1,408,807$4,589,612—
766,262—2,220,130434,988760,780—
2,789,957
7,309
4,476,716$466,501 $11,041,758

¥—
—
—
—
¥—

¥6,486(31,676)——¥(25,189)

¥—
—
—
1
¥1

¥6,486(31,676)—1¥(25,188)

$—
—
—
—
$—

$48,573(237,220)——$(188,639)$— $48,573—(237,220)——77$7 $(188,631)$15,217——4,800$20,017

Over 10 years

¥—
—
—
1,042
¥1,042

Over 10 years

$—
—
—
7,803
$7,803(*) Demand deposits are included in “Within 1 year.”

3. Fair value information by level within the fair value hierarchy
The fair value of financial instruments is classified into the following three levels according to the observability and materiality of inputs used tomeasure the fair value.

If multiple inputs are used that are significant to the fair value measurement, the fair value measurement is categorized in its entirety at the level ofthe lowest level input that is significant to the entire measurement.

—
13,075

3,684
13,075(*) Securities do not include investment trusts for which the market value is deemed to be the base value pussuant to the Implementation Guidance on
Accounting Standard for Fair Value Measurement Paragraph 24-3 and 24-9 (ASBJ Guidance No. 31, June 17, 2021). The amount of investment trusts
reported on the consolidated balance sheet for which Article 24-3 was applied was 222 million yen, and the amount for which Article 24-9 was applied
was 115 million yen.

Classification
Monetary claims purchased
Money held in trust
Loans:
Total Assets
Deposits:
Negotiable certificates ofdepositBorrowed money:
Total Derivative Transactions

Level 1Millions of yen
Fair value
Level 2
Level 3

Total

Thousands of U.S. dollars (Note 1-1)
Fair value
Level 1
Level 2
Level 3

Total

¥—
—
—
¥—
¥—

¥—
—
—
¥—
¥6,165,845¥4,1214,900
5,199,004¥5,208,026¥—¥4,1214,900
5,199,004¥5,208,026¥6,165,845$— $— $30,861 $30,861——
36,69536,695—— 38,935,100 38,935,100$— $— $39,002,666 $39,002,666$— $46,175,728 $— $46,175,728——¥—

629,191
681,787¥7,476,824

—
—
¥—

629,191
681,787¥7,476,824—
4,711,982—
4,711,982—
5,105,871—
5,105,871$— $55,993,589 $— $55,993,589

Note 1: A description of the valuation techniques and inputs used in the fair value measurements
AssetsMonetary claims purchased
Of monetary claims purchased, trustee beneficial rights are measured
based on prices quoted by correspondent financial institutions and areclassified as Level 3 fair value based on the inputs used for the quoted
prices. Monetary claims purchased other than trustee beneficial rights
are classified as Level 3 fair value. This is because their book value isconsidered as the fair value, taking into consideration that such items
fall under short contractual terms and their fair value approximates thebook value.
Trading account securities
Trading account securities are classified as Level 1 fair value because they
are government bonds and use unadjusted market prices in active markets.

Securities
Securities using unadjusted market prices in active markets areclassified as Level 1 fair value. These Level 1 securities include mainly
listed stocks and government bonds.
Securities that use announced market prices but are not tradedin active markets are classified as Level 2 fair value. These Level 2
securities include municipal bonds and corporate bonds.
In the case of investment trusts for which there is no transaction pricein the market, if there are no significant restrictions on cancellation
or repurchase that the market participants are required to pay for therisk, the fair value is determined as the market value and classified as
Level 2 fair value.
Of corporate bonds, private placement bonds with guarantee
obligations are measured as the present value discounted at a ratethat reflects the proper market rate corresponding to the remaining
period and credit risk based on the internal rating. As these discountrates are unobservable inputs, such private placement bonds areclassified as Level 3 fair value.
Securities that do not fall under these classifications are measured

Iyogin Holdings Integrated Report 2023

Corporate Data

Money held in trust
Of money held in trust, the components of trust property are measured
based on prices quoted by correspondent financial institutions and areclassified as Level 3 fair value according to component levels.

Iyogin Holdings Integrated Report 2023

Total

$11,113 $11,113

Sustainability

Level 1 fair value: Fair value measured using observable inputs, i.e., quoted prices in active markets for assets or liabilities that are the subject ofthe measurement.
Level 2 fair value: Fair value measured using observable inputs other than Level 1 inputs.
Level 3 fair value: Fair value measured using unobservable inputs.

89

Total

Business Strategy and Plan for Realizing
the Long-Term Vision

Deposits (*)
Negotiable certificates of deposit
Payables under securities lending transactions
Borrowed money
Total

1-3 years¥—(2) Financial instruments other than those measured at fair value
As of March 31, 2023

Note iii. Amounts to be repaid for borrowed money and other interest bearing liabilities
Millions of yen
2023
3-5 years
5-7 years

Classification
Monetary claims purchased
Trading account securities
Trading securities
Japanese government
bonds
Money held in trust
Securities:
Available-for-sale securities
Japanese government
bonds
Municipal bonds
Corporate bonds
Equity securities
OthersTotal Assets
Derivative transactions
Interest rate-related
derivatives
Currency-related derivatives
Bond-related derivatives
OthersTotal Derivative Transactions

Thousands of U.S. dollars (Note 1-1)
Fair value
Level 1
Level 2
Level 3

Value Creation Story

Within 1 year

Thousands of U.S. dollars (Note 1-1)2023
1-3 years
3-5 years
5-7 years
7-10 years

Level 1Millions of yen
Fair value
Level 2
Level 3

Over 10 years

Message from the Management

Due from banks
Cash collateral provided for securities borrowed
Monetary claims purchased
Securities
Held-to-maturity debt securities
Securities with maturities
Japanese government bonds
Municipal bonds
Corporate bonds
Loans and bills discounted (*)
Total

Within 1 year

(1) Financial instruments measured at fair value
As of March 31, 2023
About the Iyogin GroupDue from banks
Cash collateral provided for securities borrowed
Monetary claims purchased
Securities
Held-to-maturity debt securities
Securities with maturities
Japanese government bonds
Municipal bonds
Corporate bonds
Loans and bills discounted (*)
Total

Millions of yen
2023
3-5 years
5-7 years

90Corporate Data

based on prices quoted by correspondent financial institutions and areclassified as Level 3 fair value based on the inputs used for the quoted
prices.

Borrowed money
The fair value of borrowed money with a floating rate is consideredequal to the book value because the fair value of these items
approximates the book value, taking into account that the rate
reflects the market rate in a short period and that the creditworthinessof the Company and its consolidated subsidiaries and subsidiarycorporations, etc., has not changed significantly since the inception
date. The fair value of borrowed money with a fixed rate is calculated
as the present value, discounting future cash flows for its principal andinterest at a rate that reflects the proper market rate corresponding
to the remaining period and credit risk of the Group. These items areclassified as Level 2 fair value.

Note 2: Information on Level 3 fair value of the financial instruments that are recognized at fair value in the consolidated balance sheet(1) Quantitative information on significant unobservable inputs (as of March 31, 2023)
Significant
unobservable
inputClassification

Valuation technique

Securities: Corporate bonds

Present value method

Discount rate 0.1%–16.5%

Millions of yen
Profit or loss or othercomprehensive income forthe period

91

Iyogin Holdings Integrated Report 2023

¥ 2,157
1,507

¥ —
(119)

¥ (2)
201

62,393
11,273

0
—

(0)
—

0
(2)

¥

Transferout ofLevel 3Endingbalance

(669)
157

¥—
—

¥—
—

¥ 1,484
1,746

¥ —
(119)

66
3

(4,376)(10,300)————

58,084
976

—
—

—
—

—
3

—
—

—
—

—
1

—
(2)

$ (14)
1,505$ (5,010)
1,175

$—
—

$—
—

$ 11,113
13,075$—(891)

467,258
84,422

0
—

494
22

(32,771)(77,136)————434,988
7,309

—
—

(0)
—

0
(14)

—
—

—
22

—
—

—
—

—
7

—
(14)

Income.
(*2) O ther comprehensive income is included in Valuation difference on available-for-sale securities in Other comprehensive income of Consolidated Statementof Comprehensive Income.

(3) A description of valuation processes used for fair value measurements
The Risk Management Division of the Group has established policies and procedures for measuring fair value and procedures for using the fair value
valuation model. The Group verifies whether the fair value obtained is measured using valid valuation techniques and inputs and whether they areclassified into an appropriate level of the fair value hierarchy. When using quoted prices obtained from third parties as fair values, the Group verifies
whether the prices are valid using appropriate methods, such as by confirming the valuation techniques and inputs used and comparing them withthe fair value estimated by the Group.
(4) Sensitivity of the fair value measurement to changes in significant unobservable inputs
Of corporate bonds, the fair value of private placement bonds with guarantee obligations is calculated by adjustment rates against standard market
interest rates such as swap rates. These adjustment rates comprise risk premiums required by market participants against uncertainties on cash flows
arising mainly from credit risks. A significant increase (decrease) in discount rates generally leads to a significant decrease (rise) of fair value.

(Notes to Securities)*1 In addition to “Securities” on the consolidated balance sheets, this includes “Trading account securities” and trust beneficiary interests in“Monetary claims purchased.”
1 Trading securities:
Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023

2023

Unrealized gains (losses) included in
profit and loss for the fiscal year¥(25)$(187)

2 Held-to-maturity debt securities:
None

Corporate Data

Monetary claims purchased
Money held in trust
Securities:
Available-for-sale securities
Corporate bonds
OthersTotal Derivative Transactions
Credit derivatives
OthersTransfer
into
Level 3—(891)

Sustainability

Beginningbalance

Gains or losses
on valuation offinancial assets
and financial
liabilities heldat the end of
the reporting
periodincluded in
profit or loss
for the period(*1)$

Endingbalance(*1) P rofit or loss is included mainly in Other operating income, Other operating expenses, Other income and Other expenses of Consolidated Statement of

0.5%(2) A reconciliation from the beginning balances to the ending balances and gains or losses on valuation of financial assets and financial liabilities heldat the end of the reporting period
included in profit or loss for the period (as of March 31, 2023)

Purchases,
sales,
issuances,
RecognizedandRecognizedin otherin profit or comprehensive settlements(net)loss (*1)
income (*2)

Total Derivative Transactions
Credit derivatives
Others

Weighted
average of
inputsRange ofinputs$ 16,153
11,285

Transferout ofLevel 3Business Strategy and Plan for Realizing
the Long-Term Vision

Liabilities
Deposits and negotiable certificates of deposit
The fair value of demand deposits is considered the payable amount asof the consolidated balance sheet date (the book value). In addition,

Monetary claims purchased
Money held in trust
Securities:
Available-for-sale securities
Corporate bonds
OthersTransfer
into
Level 3

Value Creation Story

Derivative transactions
Derivative transactions using unadjusted market prices in active markets
are classified as Level 1 fair value and includes bond futures.However,as most derivative transactions are traded over the counter and theirmarket prices are not announced, their fair value is calculated using
valuation techniques, including the present value model and the option
pricing model. These valuation techniques input mainly interest rates,
foreign exchange rates, volatilities and others. In addition, the valuation
amount is adjusted based on the credit risk of counterparties and theGroup.
If unobservable inputs are not used or their impact is insignificant,those derivative items are classified as Level 2 fair value and include
interest rate swaps and forward exchange contracts.
If significant unobservable inputs are used, the items are classified as
Level 3 fair value.

Beginningbalance

Purchases,
sales,
issuances,
RecognizedandRecognizedin otherin profit or comprehensive settlements(net)loss (*1)
income (*2)

Gains or losses
on valuation offinancial assets
and financial
liabilities heldat the end of
the reporting
periodincluded in
profit or loss
for the period(*1)

Message from the Management

Loans and bills discounted
Loans and bills discounted with floating rates are classified as Level
3 fair value. This is because their book value is considered as thefair value, taking into account that the rates reflect the market rate
in a short period and that the fair value approximates the bookvalue unless the borrower’s creditworthiness changes significantly
after the inception date. Loans and bills discounted with fixed rates
are classified as Level 3 fair value. This is because their fair value ismeasured as the present value, discounting future cash flows arisingfrom principal and interest at a rate that reflects the proper market
rate corresponding to the remaining period and credit risk based on
the internal rating and because these discount rates are unobservable
inputs.
Loans and bills with short-term contractual terms (within one year) areclassified as Level 3 fair value because their fair value approximates
the book value and such book value is considered as the fair value.
In addition, loans to bankrupt borrowers, substantially bankrupt
borrowers and potentially bankrupt borrowers are classified as Level 3
fair value. Their fair value approximates the consolidated balance sheet
amount as of the consolidated balance sheet date less the reserve forloan losses since the loan losses are calculated based on the estimatedcollectable amount from collateral and/or guarantees.
Of loans and bills discounted, loans and bills discounted with nomaturity due to conditions such as limiting the loans to the value ofpledged assets are classified as Level 3 fair value.
Their fair value is deemed as the book value since the fair value is
expected to approximate the book value considering the estimatedloan period, interest rate and other conditions.

Thousands of U.S. dollars (Note 1-1)
Profit or loss or othercomprehensive income forthe period

About the Iyogin Groupthe fair value of fixed-term deposits and negotiable certificates ofdeposit is calculated as the present value, discounting the future cash
flow at a rate that reflects the proper market rate corresponding to
the remaining period and credit risk of the Group. The fair value ofdeposits with short contractual terms (within one year) is consideredequal to the book value since the fair value approximates the bookvalue. These items are classified as Level 2 fair value.

Iyogin Holdings Integrated Report 2023

92

Corporate Data

3 Available-for-sale securities:
Thousands of U.S. dollars (Note 1—1)
2023
Acquisition
Book value
cost
Difference¥ 357,707
215,406
102,319
71,37541,711
366,823¥ 939,937

Securities with unrealized losses
Equity securities
Bonds
Japanese government bonds
Municipal bonds
Corporate bonds
Other
Total
Total

¥

14,836284,955—
225,079
59,876
232,775
532,567¥1,472,504

70,979207,319
96,702
69,40041,216346,396¥ 624,696¥286,727
8,086
5,616
1,974
494
20,427¥315,240$ 2,678,851
1,613,165
766,262
534,524
312,371
2,747,120$ 7,039,144$ 531,558
1,552,602
724,196
519,733
308,6642,594,143$4,678,319$2,147,285
60,55542,057
14,783
3,699
152,976$2,360,817

Acquisition
cost

DifferenceBook value

Acquisition
cost

Difference¥

16,113
289,231—
228,883
60,347
242,530
547,876¥1,172,573¥ (1,277) $ 111,106(4,276)
2,134,014——(3,804)
1,685,606(471)
448,408(9,755)
1,743,241(15,309)3,988,369¥299,931 $11,027,514$ 120,669
2,166,037—
1,714,094
451,935
1,816,295
4,103,018$8,781,345$(9,563)(32,022)—(28,487)(3,527)(73,054)(114,648)$2,246,169

4 Available-for-sale securities sold:

Equity securities
Bonds
Corporate bonds
Other
Total

¥

7,064
281
281
1,676,464¥1,683,809

Losses¥ 1,267 $
52,901
—
2,104
—
2,104
29,205
12,554,961¥30,472 $12,609,967$ 19,943
00239,279$259,230

9,488——
218,714$228,203

Money held in trust for investment
Book value (fair value)
Amount of net unrealized gain
(loss) included in profit and loss forthe fiscal year
Other money held in trustBook value (fair value)
Acquisition cost
Difference
Unrealized gains
Unrealized losses¥299,981
532(92,046)$2,246,543
3,984(689,328)

208,467(6,361)

1,561,199(47,637)¥202,105$1,513,555(Notes to Derivative Transactions)
At March 31, 2023
1 Derivative transactions to which hedge accounting was not applied
Derivative transactions to which hedge accounting was not applied are set forth in the tables below.
The contract amount do not reflect the market risk associated with the derivatives.
(1) Interest rate contracts

Over-the-counter transactions:Swaps:
Receive fixed rate and pay
floating rate
Receive floating rate and pay
fixed rate
Total

Contract
amountMillions of yen
2023
Portionmaturing over
one year
Fair value

Recognized
gains(losses)Thousands of U.S. dollars (Note 1-1)
2023
PortionRecognizedContract
maturing overgains
amountone year
Fair value(losses)¥127,538¥125,394¥(3,396)¥(3,396)$ 955,126$ 939,069$(25,432)$(25,432)

127,538—

125,394—

5,048¥ 1,651

5,048¥ 1,651

955,126—

939,069—

37,804$ 12,364

37,804$ 12,364

The above transactions are measured at fair value, and recognized gains (losses) are charged to the consolidated statements of income.
(2) Currency and foreign exchange contracts

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023

2023

¥

—

$

—

¥

—

$

—

6,647
6,114
532
532
—

2023

(Note) E xchange translation differences, etc., related to foreign currency
denominated equity and other securities without fair market
value and investments in partnerships, etc., are included above in
Available-for-sale securities of Valuation gains.

$(Notes to Money Held in Trust)
The following table summarizes the book values (fair values) andamounts of net unrealized gains and losses for money held in trust
included in profit and loss for the fiscal year.

2023

49,77945,787
3,984
3,984
—

Contract
amountOver-the-counter transactions:
Currency swaps
Forward exchange contracts:
Sell
Buy
Currency options:
Sell
Buy
Total

Millions of yen
2023
Portionmaturing over
one year
Fair value¥453,647¥441,630

385,546
280,275

78,00977,857

212,112212,112—

155,841
155,841—¥214

Recognized
gains(losses)¥Thousands of U.S. dollars (Note 1-1)
2023
PortionRecognizedContract
maturing overgains
amountone year
Fair value(losses)

214$3,397,341$3,307,346

$

1,602

$

1,602

(7,724)
5,141(7,724)5,141

2,887,336
2,098,966

584,205
583,067(57,844)
38,500(57,844)
38,500(8,677)8,213¥(2,832)(2,107)
2,611¥(1,864)

1,588,496
1,588,496—

1,167,086
1,167,086—(64,981)
61,506$(21,208)(15,779)
19,553$(13,959)

Business Strategy and Plan for Realizing
the Long-Term Vision

5 Securities impaired
Certain securities other than trading securities (excluding equity
and other securities without fair market value and investmentsin partnerships, etc.) are written down to the fair value, and thedifference between the acquisition cost and the fair value is treated asloss for the fiscal year (impairment (devaluation)) if the fair value hassignificantly deteriorated from the acquisition cost, unless it is deemedthat there is a possibility of a recovery in the fair value. The amountof impairment (devaluation) was ¥4,016 million ($30,075 thousand),including ¥3,946 million ($29,551 thousand) of equity securities and¥ 70million ($524 thousand) of bonds at March 31, 2023. A security
is deemed to have “significantly deteriorated” if the fair value has
decreased to 50% or less of the acquisition cost. If the fair value
exceeds 50% but is 70% or less of the acquisition cost, the security
may be deemed “significantly deteriorated” considering the change
in the quoted market price during a certain period in the past, therelated business performance and other factors.

¥ 2,6630031,951¥34,615

Thousands of U.S. dollars (Note 1-1)
2023
Amount sold
Gains
LossesThousands of
U.S. dollars(Note 1-1)

Value Creation Story

Millions of yen
2023
Amount sold
Gains

Valuation gains
Available-for-sale securities
Other money held in trust
Deferred tax liabilities
Valuation difference on available-forsale securities (before adjustment forminority interests)
Noncontrolling interests
Valuation difference on available-forsale securities

Millions of yen

Message from the Management

Book value¥(Notes to Valuation difference on available-for-sale securities)
Valuation difference on available-for-sale securities were as follows:
About the Iyogin Group

Securities with unrealized gains
Equity securities
Bonds
Japanese government bonds
Municipal bonds
Corporate bonds
Other
Total

Millions of yen
2023
Acquisition
Book value
cost
Difference

The above transactions are measured at fair value, and recognized gains (losses) are charged to the consolidated statements of income.
Sustainability
Corporate Data

93

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

94

Corporate Data

(3) Others

Contract
amountThousands of U.S. dollars (Note 1-1)
2023
PortionRecognizedContract
maturing overgains
amountone year
Fair value(losses)

Recognized
gains(losses)Over-the-counter transactions:
Earthquake derivatives
Sell
Buy
Total

¥1,950
2,150
—

¥—
—
—

¥(22)
23
¥1

¥—
—
¥—

$14,603
16,101—$———$(164)
172
$7

$—
—
$—

The above transactions are measured at fair value, and recognized gains (losses) are charged to the consolidated statements of income.

(4) Retirement benefit cost and its breakdown

2 Defined benefit plan
(1) Reconciliation of retirement benefit obligations between the
beginning and the end of the period(5) Remeasurements of defined benefit plans
The breakdown of items included in remeasurements of defined
benefit plans (before applicable tax effects) was as follows:(1) Interest rate contracts

HedgedContract
amountHedgeditems

Fair value

—

—

—

¥539,125—¥539,125—¥4,835¥4,835—

Thousands of U.S. dollars (Note 1-1)
2023
PortionContract
maturing overamountone year
Fair value

—

—

—

$4,037,482—$4,037,482—$36,209$36,209

The above transactions are accounted for with the deferral hedge accounting treatment stipulated in JICPA Industry-specific Committees Guidance No. 24, March
17, 2022, “Treatment for Accounting and Auditing of Application of Accounting Standard for Financial Instruments in the Banking Industry.”(2) Currency and foreign exchange contracts

Hedged items

Foreign currency
monetary assets¥330,175——¥258,141——

Fair value¥(28,843)—¥(28,843)

Thousands of U.S. dollars (Note 1-1)
2023
PortionContract
maturing overamountone year
Fair value$2,472,665——$1,933,206——$(216,003)—$(216,003)

The above transactions are accounted for with the deferral hedge accounting treatment stipulated in JICPA Industry-specific Committees Guidance
No. 25, October 8, 2020, “Treatment for Accounting and Auditing of Accounting for Foreign Currency Transactions in the Banking Industry.”

2023

2023

¥67,9362,253
294(3,379)(3,663)
149$508,769
16,8722,201(25,305)(27,432)
1,115

63,592476,237(2) Reconciliation of pension assets between the beginning andthe end of the period

Pension assets at the beginning of theperiodExpected return on pension assets
Actuarial differences incurred
Employer’s contributions
Retirement benefits paid
Pension assets at the end of the period

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023

2023

¥95,066
1,171
10
1,477
(2,419)95,305$711,944
8,769
74
11,061(18,115)
713,734(Note) Pension assets include assets in the retirement benefit trust.

(3) Reconciliation of retirement benefit obligations and pension
assets at the end of the period to net defined benefit liability
and net defined benefit asset in the consolidated balance
sheetsRetirement benefit obligations of the nonsavings plan
Net liabilities and assets recorded on the
consolidated balance sheets
Net defined benefit liability
Net defined benefit asset
Net liabilities and assets on the
consolidated balance sheets

Thousands of
U.S. dollars(Note 1-1)

2023

2023

¥ 63,122(95,305)(32,183)$ 472,717(713,734)(241,016)

470

3,519

(31,712)
10,146(41,859)(237,489)
75,982(313,480)(31,712)(237,489)(Note 1) Retirement benefit costs of consolidated subsidiaries using thesimplified method are included in “Service cost.”(Note 2) Employee contribution to the corporate pension fund is deductedfrom “Service cost.”

Prior service cost
Actuarial differences
Total

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ (739)
1,659
920

2023
$ (5,534)
12,424
6,889(6) Remeasurements of defined benefit plans
The breakdown of items included in remeasurements of defined
benefit plans (before applicable tax effects) was as follows:

Unrecognized prior service cost
Unrecognized actuarial differences
Total

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

2023
¥ (723)(13,108)(13,831)2023$ (5,414)(98,165)(103,579)(7) Pension assets① Pension asset portfolio
Bonds
Equity securities
Other
Total

2023
47.0%
46.5%
6.5%
100.0%(Note) 34.6% of the total pension assets as of March 31, 2023 represent
assets in the retirement benefit trust for the corporate pension fund,
4.3% of which as of March 31, 2023 corresponds to the lump-sum
grant system.

②	Determination of the long-term expected rate of return on pension
assetsThe long-term expected rate of return on pension assets is determinedbased on the average investment yield on the pension assets for the
past three years. When the average rate is below 1.25% or above
2.0%, it is stated as 1.25% and 2.0%, respectively.

Sustainability

Retirement benefit obligations of thesavings plan
Pension assets

Millions of yen

2023$ 15,427
2,201(8,769)(12,948)(4,410)(8,492)Business Strategy and Plan for Realizing
the Long-Term Vision

Method of hedge accounting
Deferral hedge method
Currency swaps
Fund related swaps
Total

Contract
amountMillions of yen
2023
Portionmaturing over
one year

Retirement benefit obligations at the
beginning of the period
Service cost
Interest cost
Actuarial differences incurred
Retirement benefits paid
Prior service cost
Retirement benefit obligations at theend of the period

Millions of yen

2023¥ 2,060294(1,171)(1,729)(589)(1,134)

Value Creation Story

items
Method of hedge accounting
Deferral hedge
methodInterest rate swaps
Loans
Receive fixed rate
and pay floating rate
Receive floating rate
and pay fixed rate
Total—

Millions of yen
2023
Portionmaturing over
one yearThousands of
U.S. dollars(Note 1-1)Service cost
Interest cost
Expected return on pension assets
Recognized actuarial differences
Amortization of prior service cost

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

Message from the Management

2 Derivative transactions to which hedge accounting was applied
Derivative transactions to which hedge accounting was applied are set forth in the tables below.
The contract amount do not reflect the market risk associated with the derivatives.

(Notes to Retirement Benefits)
1 Outline of retirement and severance benefits plans
The retirement benefit plans of the consolidated banking subsidiaryconsist of a defined benefit corporate pension fund plan, a retirement
lump-sum grant system and a defined contribution pension plan.
In addition, the consolidated banking subsidiary set up a retirement
benefit trust.
The retirement benefit plans of other consolidated subsidiaries
consist of a retirement lump-sum grant system and a defined
contribution pension plan.
Other consolidated subsidiaries use the simplified method
in calculating net defined benefit liability and retirement benefit
expenses for their retirement lump-sum grant systems.

About the Iyogin Group

Millions of yen
2023
Portionmaturing over
one year
Fair value

95

Iyogin Holdings Integrated Report 2023

Corporate Data

(Note) Pension assets include assets in the retirement benefit trust.

Iyogin Holdings Integrated Report 2023

96

Corporate Data

(Note) A point system is applied to the substantive portion of the retirement
lump-sum grant system and a cash balance plan to defined benefit
corporate pension fund plans, respectively. The “Estimate rate of salary
increase” is not disclosed due to the insignificant impact it would haveon the calculation of retirement benefit obligations.

2 Method of estimating the number of stock options vested
Only the actual number of forfeited stock options is reflected because
it is difficult to rationally estimate the actual number of stock options
that will be forfeited in the future.

3 Defined contribution plan
The amount of required contribution of the Group to the defined
contribution plans was ¥359 million ($2,688 thousand) at March 31,
2023.

(Notes to Income Taxes)
1 Significant components of deferred tax assets and liabilities
were as follows:

Iyogin holdings, Iyogin holdings, Iyogin holdings, Iyogin holdings, Iyogin holdings, Iyogin holdings, Iyogin holdings,
Inc.
Inc.
Inc.
Inc.
Inc.
Inc.
Inc.
7th Stock Options 6th Stock Options 5th Stock Options 4th Stock Options 3rd Stock Options 2nd Stock Options 1st Stock Options
Title and numberof grantees

Directors of the Iyo Directors of the Iyo Directors of the Iyo Directors of the Iyo Directors of the Iyo Directors of the Iyo Directors of the Iyo
Bank: 5
Bank: 3
Bank: 3
Bank: 2
Bank: 1
Bank: 1
Bank: 1
Executive Officers Executive Officers Executive Officersof the Iyo Bank: 2 of the Iyo Bank: 2 of the Iyo Bank: 1

Number of stock
options (*2)

Common shares: Common shares: Common shares: Common shares: Common shares: Common shares: Common shares:
48,90043,10016,60017,80016,30024,00015,200July 14, 2017

July 15, 2016

July 15, 2015

July 16, 2014

July 16, 2013

July 17, 2012

July 15, 2011

Conditions for vesting

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

Requisite service
period

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

Exercise period

October 3, 2022 October 3, 2022 October 3, 2022 October 3, 2022 October 3, 2022 October 3, 2022 October 3, 2022
to July 14, 2047 to July 15, 2046 to July 15, 2045 to July 16, 2044 to July 16, 2043 to July 17, 2042 to July 15, 2041(*1) Due to the establishment of The Iyo Bank, Ltd. through a single share transfer, the Company has delivered new stock acquisition rights to the ones issued by
the Iyo Bank, Ltd.
(*2) Reported in terms of shares of stock(*3) The grant date is the original grant date at The Iyo Bank, Ltd.

6th
Stock Options
shares5th
Stock Options
shares4th
Stock Options
shares

3rd
Stock Options
shares2nd
Stock Options
shares

1st
Stock Options
shares—48,900—4,500
44,400—43,100—5,600
37,500—16,600——16,600—17,800——17,800—16,300——16,300—24,000——24,000—15,200——15,200

—
4,500
—
—
4,500

—
5,600
—
—
5,600

—
—
—
—
—

—
—
—
—
—

—
—
—
—
—

—
—
—
—
—

—
—
—
—
—

Before vesting
Previous fiscal
year-end
GrantedForfeited
VestedOutstanding
After vesting
Previous fiscal
year-end
VestedExercised
Forfeited
Exercisable② Price information

Exercise price
Average exercise
price

97

¥867 ($6)
per share

Iyogin Holdings Integrated Report 2023

¥601 ($4)
per share¥1,473 ($11)
per share¥989 ($7)
per share¥918 ($6)
per share¥550 ($4)
per share¥704 ($5)
per share

263
2,922
(1,103)20,0991,969
21,882(8,260)150,520¥ (91,963)$(688,706)(6,570)(880)(49,202)(6,590)(707)(100,122)¥ (80,022)(5,294)(749,809)$(599,281)

2 A reconciliation of the statutory tax rate and effective tax
rate for the years ended March 31, 2023 was as follows:
For the fiscal year ended March 31, 2023, a reconciliation of thestatutory tax rate and the effective income tax rate is not stated as thedifference between the two was less than 5% of the statutory tax
rate.
(Business Combinations, etc.)(Transactions under common control)
1 Incorporation of Holding Company through a Solo Share
Transfer(1) Summary of transaction①	Combined entity’s name and business		Wholly owned subsidiary company in share transfer, The Iyo Bank,
Ltd. (Banking)② Date of business combination
		 October 3, 2022
③ Legal form of business combination
		 Incorporation of holding company through a solo share transfer④ The Name of company
		Wholly owning parent company through share transfer, Iyogin
Holdings, Inc.
⑤ Other matters concerning the outline of transaction
The company was established with the aim of expanding thescope of the business in light of deregulation, enhancing group
governance by strengthening management functions, and maximizing
group synergies.
As of October 3, 2022, the Company acquired all shares in The
Iyogin Credit Guarantee Company Limited, Iyogin Capital Company
Limited, Iyogin Regional Economy Research Center, Inc., Iyogin DC
Card Co., Ltd., Iyogin Leasing Company Limited, Iyogin Computer
Service Company Limited, and Shikoku Alliance Securities Co., Ltd.,
which were held by Iyo Bank, a wholly owned subsidiary of the

2 Acquisition of shares of subsidiaries(1) Summary of transaction① Combined entity’s name and business		Iyogin Capital Company Limited (investment in stocks andcorporate bonds, management of investment funds, etc.)
		 Iyogin Leasing Company Limited (leasing operations, etc.)② Date of business combination
		 December 12, 2022
③ Legal form of business combination
		 Acquisition of shares from noncontrolling shareholders④ The name of company
		 The name remains the same after the business combination.
⑤ Other matters concerning the outline of transaction
The Company acquired shares held by noncontrolling shareholders
in order to enhance group governance and maximize group synergies
by strengthening management functions.
(2) Accounting method
In accordance with the “Business Combination Standards” (ASBJ
Statement No. 21, Jan. 16, 2019) and the “Guidelines for the
Application of the Business Combination Standards and the BusinessSeparation Standards” (ASBJ Statement Application Guideline No.
10, Jan. 16, 2019), we treated the transaction as one with entities
under common control the same as trading with noncontrollingshareholders.
(3) Additional acquisition of shares in subsidiary
Consideration paid for acquisition: cash and due from banks in theamount of ¥1,699 million ($12,723 thousand)(4) Matters related to changes in the Company’s equity intransaction with noncontrolling shareholders① Main fluctuation factors of capital surplus
		 Additional acquisition of subsidiary shares②	Amount of capital surplus increased due to transactions with
noncontrolling shareholders:		 ¥5,533 million ($41,436 thousand)Corporate Data

Fair value at the
grant date

7th
6th
5th
4th
3rd
2nd
1st
Stock Options
Stock Options
Stock Options
Stock Options
Stock Options
Stock Options
Stock Options
Yen (U.S. dollars) Yen (U.S. dollars) Yen (U.S. dollars) Yen (U.S. dollars) Yen (U.S. dollars) Yen (U.S. dollars) Yen (U.S. dollars)¥ 1 ($0)¥ 1 ($0)¥
1 ($0)¥ 1 ($0)¥ 1 ($0)¥ 1 ($0)¥ 1 ($0)
per shareper shareper shareper shareper shareper shareper share
—
—
—
—
—
—
—
per shareper shareper shareper shareper shareper shareper share$ 108,290
12,251
5,489
4,830
4,051

Sustainability

7th
Stock Options
shares¥ 14,460
1,636
733
645
541

Business Strategy and Plan for Realizing
the Long-Term Vision(2) Stock options granted and changes
The table below represents stock options outstanding at the year-end and the number of stock options is converted into the number of stock.
① Number of stock options

2023

Value Creation Story

Grant date (*3)

Deferred tax liabilities:
Valuation difference on availablefor-sale securities
Retirement benefit asset
Deferred gains on real property
Net deferred gains (losses) on
derivatives under hedge accounting
Total deferred tax liabilities
Net deferred tax liabilities:

2023(2) Accounting method
In accordance with the “Business Combination Standards” (ASBJ
Statement No. 21, Jan. 16, 2019) and the “Guidelines for the
Application of the Business Combination Standards and the BusinessSeparation Standards” (ASBJ Statement Application Guideline No. 10,
Jan. 16, 2019), we treated the transaction as one with entities undercommon control.

Message from the Management(Notes to Stock Options)
1 Outline of stock options and changes(1) Outline of stock options

Deferred tax assets:
Excess reserve for loan losses
Write-down of securities
Impairment loss on land
Excess depreciation
Accrued employees’ bonuses
Reserve for losses on repayments on
dormant bank accounts
Other
Valuation reserve
Total deferred tax assets

Millions of yen

Thousands of
U.S. dollars(Note 1-1)

Company, using the method in which a dividend in kind is received
from Iyo Bank, and has made these seven companies our directly
owned subsidiaries.
About the Iyogin Group(8) Actuarial assumptions
The weighted average rate for assumptions used for the actuarial
computation of the retirement benefit obligations for the years ended
March 31, 2023 was as follows:
2023
Discount rates
Retirement lump-sum grant system
0.30%
Corporate pension fund plans
0.90%
Long-term expected return on assets
Pension assets of corporate pension
fund
2.00%
Retirement benefit trust(Retirement lump-sum grant systemand corporate pension fund plans)
0.00%

Iyogin Holdings Integrated Report 2023

98

Corporate Data

(Notes to Revenue Recognition)
Disaggregation of revenue from contracts with customers (as of March 31, 2023)

¥

3,899
2,942
807
4,439

¥

—
—
—
—

¥

3,899
2,942
807
4,439

¥

—
—
1,059
270

Total

¥

3,899 $
2,942
1,867
4,709

29,199 $22,032
6,043
33,243—$———29,19922,032
6,043
33,243—90,526

$

Total

—$
—
7,930
2,022

29,19922,032
13,98135,265

9,952

100,486

12,088—12,0881,329

13,41890,526

142,791

16,013

158,805730

159,535

1,069,355

119,920 1,189,283

5,466 1,194,750¥154,880¥16,013¥170,893¥2,060¥172,954 $1,159,889$119,920 $1,279,809$15,427 $1,295,244

Notes: The “Other businesses” category is a business segment not included in reportable segments and represents information processing entrustment and thesoftware development business and securities business etc..

2 Methods used to calculate ordinary income, profit and loss, amounts of assets, debt and other items by reportable segment
The accounting policies described int the Note in (Basis of Presenting Consolidated Financial Statements) have been adopted for the reportablesegments. Reportable segment profit corresponds to ordinary profits. Ordinary income arising from intersegment transactions is based on arm’s length
prices.
3 Information about reported ordinary income, profits and losses, amounts of assets, debts and other items
Segment information as of and for the years ended March 31, 2023 was as follows:

Reportable segments
Commercial
Banking
Leasing¥ 154,880
1,114¥ 155,994¥42,292¥8,512,600¥7,787,269¥16,013
3,731¥19,744¥4,155¥56,496¥33,546¥ 170,893
4,845¥ 175,739¥46,448¥8,569,096¥7,820,815

¥

2,060
13,043¥ 15,104¥ 10,076¥514,956¥6,785$ 1,159,889
8,342$ 1,168,231$ 316,722$63,750,468$58,318,497$119,920 $ 1,279,809
27,94136,283$147,861 $ 1,316,101$ 31,116$347,846$423,095 $64,173,563$251,224 $58,569,722

15,427 $ 1,295,244
97,678133,962$ 113,113 $ 1,429,214$ 75,458 $ 423,305$3,856,481 $68,030,053$ 50,812 $58,620,542

$

$

$

46,057
719,808
155,822
37

202 $
1,025
763
—

46,266
720,841
156,586
37(37)
14,393(2,523)(5,234)

—
0
(0)
—

—

6,150
96,11620,807
5

¥

27
137
102
—

¥

6,178
96,25420,909
5

¥

37
8,780
0
0

$

Consolidated
total

$

— $ 1,295,244(133,962)—$ (133,962) $ 1,295,244$ (105,661) $ 317,643$(3,993,664) $64,036,381$ (274,545) $58,345,989

277 $
65,7530046,543 $786,594
156,59444(546) $
(66,471)(651)—

45,989720,122
155,93444(37)
14,393(2,523)(5,234)

(0)
7
(0)
—

(44)
14,401(2,523)(5,234)

—
—
—
—

(44)
14,401(2,523)(5,234)

—

—

(7)

(7)

—

(7)

(6,627)88,444—
1,909(6,627)90,354—748(6,627)
91,103—37(6,627)
91,14864,135

149

64,285636

64,929(404)

64,517

Total

Adjustments¥ 172,954
17,888¥ 190,843¥56,524¥9,084,053¥7,827,601¥—(17,888)¥ (17,888)¥ (14,109)¥(533,274)¥ (36,660)

Consolidated
total¥ 172,954—¥ 172,954¥42,415¥8,550,778¥7,790,940

Millions of yen
2023
Securities
investments

Loans

Ordinary income customers¥72,470¥

6,215
105,034
20,9106¥(73) ¥(8,876)
(87)
—

6,141
96,15820,822
6

(5)
1,922
(337)
(699)

—
0
(0)
—

(5)
1,922
(337)
(699)

(0)
1
(0)
—

(6)
1,923
(337)
(699)

—
—
—
—

(6)
1,923
(337)
(699)

—

—

—

(1)

(1)

—

(1)

Lease

¥61,862¥16,013

Other
businesses¥22,608

Total¥172,954

Thousands of U.S dollars (Note 1-1)
2023
Securities
investments

Loans

¥

Adjustments

Ordinary income customers$542,724

Lease$463,281$119,920

Otherbusinesses$169,310

Total$1,295,244

Millions of yen
2023
Reportable segments
Commercial
Banking

Impairment loss

¥699

Leasing

¥—

Total

Other
businesses

¥699

¥—

Sustainability

Ordinary income
Customers
Intersegment
Total
Segment profit
Segment assets
Segment debt
Other items
Depreciation
Interest income received
Interest expense paid
Extraordinary income
Gain on disposal of noncurrent
assetsExtraordinary losses
Losses on disposal of fixed assets
Impairment loss
Provision of reserve for financial
products
transaction liabilities
Provision for dismantling costs offixed assets
Tax expense
Increase in tangible fixed assets
and intangible fixed assets

Total(4) Related information
Information by service

Otherbusinesses

Total

Ordinary income
Customers
Intersegment
Total
Segment profit
Segment assets
Segment debt
Other items
Depreciation
Interest income received
Interest expense paid
Extraordinary income
Gain on disposal of noncurrent
assetsExtraordinary losses
Losses on disposal of fixed assets
Impairment loss
Provision of reserve for financial
products
transaction liabilities
Provision for dismantling costs offixed assets
Tax expense
Increase in tangible fixed assets and intangible
fixed assets

Otherbusinesses

Total

Business Strategy and Plan for Realizing
the Long-Term Vision

Millions of yen
2023

Reportable segments
Commercial
Banking
Leasing

Value Creation Story(Notes to Segment Information)
1 Summary of reportable segments
Reportable segments are components of the Group for which separate financial information is available and is subject to periodic examination by
the Board of Directors to determine the allocation of management resources and assess performances.
The Company and 17 consolidated subsidiaries are engaged mainly in the financial services business that includes commercial banking services
and leasing services. Therefore, the Group’s reportable segments comprise ‘Commercial Banking’ and ‘Leasing’ and are distinguished by thefinancial services provided. ‘Commercial Banking’ includes deposit services, lending services, securities investment services and exchange services.
‘Commercial Banking’ represents the Bank’s banking services as well as the consolidated subsidiaries’ business support services, credit guarantee
services, credit card services, securities trading services and fund management services. ‘Leasing’ includes leasing services by Iyogin Leasing
Company Limited, one of the consolidated subsidiaries.

Thousands of U.S. dollars (Note 1-1)
2023

Message from the Management

Fees and commissions
Deposit and loan services
Foreign exchange services
Securities-related services
Other services
Ordinary income fromcontracts with customers
Ordinary income from otheritems above
Ordinary income fromexternal customers

Thousands of U.S. dollars (Note 1-1)
Reportable segments
Commercial
Other
Banking
LeasingTotalbusinesses

About the Iyogin Group

Millions of yen
Reportable segments
Commercial
Other
Banking
LeasingTotalbusinesses

2. “Other businesses” includes software development, information processing and securities business etc. not included in the reportable segments.
3. Adjustments are as below.
(1) Adjustment of segment profit includes eliminations of intersegment transactions of negative ¥14,109 million ($105,661 thousand).
(2) Adjustment of segment assets includes eliminations of intersegment transactions of negative ¥533,274 million ($3,993,664 thousand).
(3) Adjustment of segment debt includes eliminations of intersegment transactions of negative ¥36,660 million ($274,545 thousand).
(4) Eliminations of intersegment transactions include adjustment of depreciation of negative ¥73 million ($546 thousand), adjustment of interest income
received of negative ¥8,876 million ($66,471 thousand), adjustment of interest expense paid of negative ¥87 million ($651 thousand), adjustment of tax
expense of ¥5 million ($37 thousand) and adjustment of increase in tangible fixed assets and intangible fixed assets of negative ¥54 million ($404
thousand).
4. Segment profit is adjusted to ordinary income in the consolidated statement of income.
5. The Company is included “Other businesses.”

Total

¥699

Thousands of U.S dollars (Note 1-1)

(885)
11,810
8,564

—
255
20

(885)
12,065
8,584

—
100
85

(885)
12,165
8,670

—
5
(54)

2023
Reportable segments(885)
12,171
8,615

Commercial
Banking

Impairment loss

$5,234

Leasing$—

Total$5,234

Other
businesses

$—

Total

$5,234
Corporate Data

Notes:
1. Ordinary income is presented as the counterpart of sales of companies in other industries. The difference between ordinary income and operating income inthe consolidated statement of income is in “Adjustments.”

99

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

100

Corporate Data

NONCONSOLIDATED BALANCE SHEET (Unaudited)
The Iyo Bank, Ltd.
March 31,2023(Notes to Related Party Transactions)
For the year ended March 31, 2023

2023

(2) Transactions between consolidated subsidiaries of the Company and related parties.
Directors or major individual stockholders

Type

Name

Capital(Millions
Location of yen)

Type

Name

¥50

Business

Temporarystaffing

Capital(Thousandsof U.S.
Location dollars)Companies inwhich a majorityof voting rights
Ability Center, Ehimeis owned by aInc
director or the
director’s close
relatives$374

Business

Temporarystaffing

Transaction
amountOwnerships of(Millionsvoting rights (%) Relationship Transactionsof yen)Account

Direct Temporary Temporary
15.0% holding
staffing
staffing

Otherliabilities¥27

Transaction
amount(Thousands
Ownerships ofof U.S.
voting rights (%) Relationship Transactions
dollars)

Account

Direct Temporary Temporary
15.0% holding
staffing
staffing

Otherliabilities$202

Outstandingbalance(Millionsof yen)¥0

Outstandingbalance(Thousandsof U.S.
dollars)$0(Consolidated Supplementary Schedules)
1 BORROWED MONEY AND LEASE LIABILITIES
Borrowed money consisted of the following:Thousands of
U.S. dollars(Note 1-1)

2023
¥684,070
347
1,298

2023
$5,122,968
2,598
9,720

The weighted average interest rate on the outstanding balances
at March 31, 2023 was as follows:
2023
Borrowings from banks
1.10%
Lease liabilities (due within one year)—
Lease liabilities (due after one year)—(Note) The “average interest rate” is not shown for lease obligations because
the Group uses a method in which amounts equal to the interest in the
total capital lease obligations are spread equally over each fiscal year of
the lease period.

101

Iyogin Holdings Integrated Report 2023

LIABILITIES AND NET ASSETS
Liabilities
Deposits
Call money
Payables under repurchase agreements
Payables under securities lending transactions
Borrowed money
Foreign exchange
Borrowed money from trust account
Other liabilities
Accrued employees’ bonuses
Employees’ severance and retirement benefits
Reserve for losses on repayment of dormant bank accounts
Reserve for contingent losses
Reserve for share-based payments
Provision for dismantling costs of fixed assets
Deferred tax liabilities
Deferred taxes on revaluation excess
Acceptances and guarantees
Total liabilities¥6,823,289——
77,501
678,847
3,680
1,045
82,595
1,566
11,782
845
1,100
409
885
72,8609,472
30,696
7,796,578¥6,654,132
7,343
74,232
139,898
744,751
1,837
554
74,5401,613
12,286
1,175
881
413
—
67,142
9,520
28,396
7,818,723$51,099,296——
580,401
5,083,853
27,5597,825
618,550
11,727
88,234
6,328
8,237
3,062
6,627
545,645
70,935229,880
58,388,212

Net assets
Common stock
Authorized — 600,000,000 shares
Issued — 313,408,831 shares
Capital surplus
Legal reserve
Other retained earnings
Treasury stock
Valuation difference on available-for-sale securities
Net deferred gains (losses) on derivatives under hedge accounting
Land revaluation excess
Stock acquisition rights
Total net assets
Total liabilities and net assets

20,948
10,48020,948424,660—
199,500
1,611
18,977—
697,127¥8,493,705

20,948
10,48020,948438,382(6,103)
188,816
1,152
19,058208
693,892¥8,512,616

156,878
78,484
156,878
3,180,259—
1,494,046
12,064142,117—5,220,751$63,608,964

Corporate Data

1 Purpose of Establishment(1) In order to respond to changes in consumer behavior, economic
structure such as population decline, advanced and diverse needs ofthe local customer, the Group recognizes the need to develop newservices and business that contribute to solving regional issues morethan ever before.
(2) In particular, in the Setouchi region and Ehime Prefecture, where$10,228,772
375,084
41,983
3,684
13,075
11,070,733
39,886,602(236,695)
302,606
852,819
527,199
87,500225,679
229,880$63,608,964

Sustainability(Significant subsequent events)(Establishment of subsidiary)
As of April 3, 2023, the Company established Iyogin Digital Solutions
Co., Ltd., a wholly owned consulting company.

2 Summary of a subsidiary(1) Name
Iyogin Digital Solutions Co., Ltd.
(2) Address
1, Minami-Horibata-cho, Matsuyama Ehime(3) Capital¥200 million(4) Date of establishment
April 3, 2023
(5) Shareholder/Equity Ratio
Iyogin Holdings, Inc. / 100%

¥1,513,960
—
6,211
525
1,507
1,686,455
5,068,841(33,749)
11,310121,272
71,531
9,397
26,95428,396¥8,512,616

Business Strategy and Plan for Realizing
the Long-Term Vision

Borrowings from banks
Lease liabilities (due within one year)
Lease liabilities (due after one year)

Millions of yen

the Group’s business bases are located, the decline in the productive
age population due to the general population decline, falling birthrate
and aging population, is ahead of the rest of the country, and theshortage of manpower has become a major management issue. The
Group recognizes the need to respond to digitization and productivity
improvements in order to resolve these issues.
(3) Against this background, the Group has established a consulting
company to promote Digital Transformation (DX), which contributes
to regional revitalization, and is working to improve regionalsustainability by supporting digitization and productivity, which areissues for local companies.

¥1,365,848
50,085
5,606
492
1,746
1,478,275
5,326,058(31,606)
40,407
113,877
70,397
11,68430,13530,696¥8,493,705

Value Creation Story(Notes)1 The conditions of the above transactions were the same as those of arm’s length transactions.
2 Ms. Junko Miyoshi, a director serving as audit and supervisory committee member, has a close relative who owns a majority of the voting rights of Ability
Center, Inc.

2023

2022

ASSETSCash and due from banks
Cash collateral provided for securities borrowed
Monetary claims purchased
Trading account securities
Money held in trust
Securities
Loans and bills discounted
Reserve for loan losses
Foreign exchange
Other assets
Tangible fixed assets
Intangible fixed assets
Prepaid pension cost
Customers’ liabilities for acceptances and guarantees
Total assets

Message from the Management

Companies inwhich a majorityof voting rights
Ability Center, Ehimeis owned by aInc
director or the
director’s close
relatives

Thousands of
U.S. dollars

Millions of yen

About the Iyogin Group(1) Transactions between the Company and related parties.
None

Iyogin Holdings Integrated Report 2023

102

Corporate Data

NONCONSOLIDATED STATEMENT OF INCOME (Unaudited)

NONCONSOLIDATED STATEMENT OF CHANGES IN NET ASSETS (Unaudited)

The Iyo Bank, Ltd.
For the year ended March 31, 2023

The Iyo Bank, Ltd.
For the year ended March 31, 2023

2023

Capital surplus
For the year ended March 31, 2023

¥ 48,929
24,506
2,022
12,625
18,776
7,301
114,161$ 497,760
200,501
19,72595,454
278,82159,3491,151,628

5,425
4,013
382
1,771
9,213
6,281
31,772
48,142
9,250
116,252
37,524

1,529
242
70
78
1,080
6,325
15,25747,2407,564
79,39034,771

40,62730,0532,860
13,262
68,99547,038
237,939
360,533
69,272870,605
281,015

10,359839¥ 26,325

9,404
706¥ 24,660

77,5786,283$ 197,146¥83.89—U.S. dollars¥77.84
77.78

$0.62
—

Balance at the beginning of the accounting period
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Commonstock

Capitalreserve

Other capitalsurplus

Total capitalsurplus¥20,948¥10,480¥—¥10,4801(8,264)8,262

1(8,264)
8,262

—
—

—
¥10,480—¥20,948—¥10,480¥

Thousands of U.S. dollars
Stockholders’ equity
Capital surplus
For the year ended March 31, 2023

Balance at the beginning of the accounting period
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Commonstock

Capitalreserve

Other capitalsurplus

Total capitalsurplus$156,878$78,484$—$78,4847(61,888)
61,873

7(61,888)
61,873———$78,484—$156,878—$78,484$

Value Creation Story¥ 66,466
26,773
2,634
12,74637,231
7,925
153,777

Yen

Basic net income per share
Diluted net income per share

2023

Message from the Management

EXPENSESInterest expense:
Interest on deposits
Interest on borrowings and rediscounts
Interest on payables under repurchase agreements
Interest on payables under securities lending transactions
Other interest expense
Fees and commissions
Other operating expenses
General and administrative expenses
Other expenses
Total expenses
Income before income taxes
Income taxes:
Current
Deferred
Net income

2022

Stockholders’ equity

About the Iyogin GroupINCOMEInterest and dividend income:Interest on loans and discounts
Interest and dividends on securities
Other interest income
Fees and commissions
Other operating income
Other income
Total income

Millions of yen

Thousands of
U.S. dollars

Millions of yen

Retained earnings
Other retained earnings

For the year ended March 31, 2023

¥20,948¥2,035Generalreserve

Retainedearnings
brought
forward

Total retained
earnings¥410,594¥25,752¥459,330(31,865)28
17,00026,325(31,865)——
26,325(28)(17,000)

Treasury
stock

Total
stockholders’equity¥(6,103)¥484,656(31,865)(3,000)
839
8,264

—
¥20,948(28)¥2,006(17,000)¥393,594(8,262)80(8,262)80

3,306¥29,059(13,722)¥445,608

¥

6,103
—

26,325(3,000)840——
80

Sustainability

Balance at the beginning of the accounting period
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Legalreserve

Deferred gains
on realproperty

Business Strategy and Plan for Realizing
the Long-Term Vision

Millions of yen
Stockholders’ equity(7,619)¥477,037

Corporate Data

103

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

104

Corporate Data

Thousands of U.S. dollars

Millions of yen

Stockholders’ equity

Stockholders’ equity

Retained earnings

Capital surplus

For the year ended March 31, 2023

$156,878

Generalreserve$15,240 $3,074,919(209)(127,312)

For the year ended March 31, 2022

Total retained
earnings$192,855 $3,439,901(238,635)
209
127,312
197,146

Treasurystock$(45,705) $3,629,566(238,635)——
197,146(238,635)(22,466)
6,283
61,888(61,873)599—$156,878(209) (127,312)$15,022 $2,947,607(61,873)599

24,758(102,763)$217,621 $3,337,137

Total
stockholders’equity$197,146(22,466)
6,290
—
—
599

45,705(57,058)— $3,572,508

Balance at the beginning of the accounting period
Cumulative effects of changes in accounting polices
Restated balance
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stock
Transfer of loss on disposal of treasury stockReversal of land revaluation excess
Changes in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Capitalreserve

Other capitalsurplus

Total capitalsurplus¥20,948¥10,480¥—¥10,480

20,948

10,480—

10,480

(292)
292

(292)
292

—
—

—
¥10,480—¥20,948—¥10,480

Millions of yen
Stockholders’ equity

Millions of yen

Retained earnings

Valuation and translation adjustments¥188,816¥1,152¥19,058¥209,027

Stockacquisitionrights¥208

Total net
assets¥693,892(31,865)
26,325(3,000)840

10,684
10,684¥199,500

458
458¥1,611(80)(80)¥18,977

11,062
11,062¥220,090

(208)
(208)
¥ —

80
10,8543,235¥697,127

Thousands of U.S. dollars

For the year ended March 31, 2022

Balance at the beginning of the accounting period
Cumulative effects of changes in accounting polices
Restated balance
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stock
Transfer of loss on disposal of treasury stockReversal of land revaluation excess
Changes in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

For the year ended March 31, 2023

$ 8,627$142,724 $1,565,393

StockacquisitionrightsTotal net
assets$1,557 $5,196,525

197,146(22,466)
6,290

(599)
82,842(599)
82,842$142,117 $1,648,243¥20,948¥2,041¥398,594

20,9482,041

398,594

Total retained
earnings¥ 18,180(167)
18,013¥439,765(167)
439,598(4,754)
6(12,000)
24,660(4,754)——
24,660(6)
12,000Treasurystock¥(6,508)(6,508)(6)¥2,03512,000¥410,594¥464,686(167)
464,519(4,754)

(638)
1,043

—
¥20,948

Total
stockholders’equity

(292)
119

(292)
119

7,739
¥ 25,752

19,732¥459,330

405¥(6,103)

StockacquisitionrightsTotal net
assets

24,660
(638)
750
—
119
20,137¥484,656

Valuation and translation adjustments(238,635)

3,429
3,429
$12,064

Generalreserve599(1,557)
81,285(1,557)
24,226$ — $5,220,751

For the year ended March 31, 2022

Balance at the beginning of the accounting period
Cumulative effects of changes in accounting polices
Restated balance
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stock
Transfer of loss on disposal of treasury stockReversal of land revaluation excess
Changes in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Net deferred
Valuation
gains (losses)
difference on on derivatives
available-for- under hedge
sale securities accounting

Land
Total valuation
revaluation and translation
excessadjustments¥214,136¥ (374)¥19,178¥232,939¥273

214,136(374)

19,178232,939273¥697,899(167)
697,732(4,754)

Sustainability

Balance at the beginning of the accounting period $1,414,034
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
80,011
Total changes during the accounting period
80,011
Balance at the end of the accounting period$1,494,046

Land
Total valuation
revaluation and translation
excessadjustments

Legalreserve

Retainedearnings
brought
forwardMillions of yen

Valuation and translation adjustments
Net deferred
Valuation
gains (losses)
difference on on derivatives
available-for- under hedge
sale securities accounting

Deferred gains
on realproperty

Business Strategy and Plan for Realizing
the Long-Term Vision

Balance at the beginning of the accounting period
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Land
Total valuation
revaluation and translation
excessadjustments

Other retained earnings

Value Creation Story

For the year ended March 31, 2023

Net deferred
Valuation
gains (losses)
difference on on derivatives
available-for- under hedge
sale securities accounting¥

Message from the Management

Balance at the beginning of the accounting period
Changes during the accounting period
Dividends
Reversal of deferred gains on real property
Provision of general reserve
Net income
Purchase of treasury stock
Disposal of treasury stockCancellation of treasury stockTransfer from retained earnings to capital surplus
Reversal of land revaluation excessChanges in items other than stockholders’ equity, net
Total changes during the accounting period
Balance at the end of the accounting period

Deferred gains
on realpropertyLegal
reserve

Retainedearnings
brought
forwardCommonstock

About the Iyogin Group

Other retained earnings

24,660(638)
750(25,320)(25,320)¥188,816

1,527
1,527
¥1,152(119)(119)¥19,058(23,911)(23,911)¥209,027

(65)
(65)
¥208

119
(23,977)(3,839)¥693,892
Corporate Data

105

Iyogin Holdings Integrated Report 2023

Iyogin Holdings Integrated Report 2023

106

Corporate Data

Corporate Data
Corporate Profile (as of March 31, 2023)

Outline of Group Companies (as of June 29, 2023)
Iyogin Holdings, Inc.

Headquarters

1, Minami-Horibata-cho, Matsuyama, Ehime, Japan

Representative

Kenji Miyoshi, Representative Director and President

CapitalLocation
The Iyo Bank, Ltd.

Prime Market of the Tokyo Stock Exchange (Securities Code: 5830)

Iyogin Leasing
Company Limited

15.01%

Consolidated subsidiaries

17 companies

Consolidated employees(excluding temporary staff)

2,986 persons

Iyogin Computer
Service Company
Limited

2-5-41 Otemachi, Matsuyama,
Ehime, Japan
Junji Kurihara, President andRepresentative Director

Foreign corporations, etc.
Other
corporations

Shareholders
other than
individual
shareholders

Individual
shareholders

Individuals
and others

Total

2

63

29

1,113

193

33

23,247

24,6808,019

1,165,334

45,059916,781378,660

363

616,646

3,130,862

0.25

37.22

1.43

29.28

12.09

0.01

19.72

100%

10.01

8,878

2.86

7,980

2.57

6,000

1.93

5,911
5,415

1.91
1.74

4,982

1.60

4,613

1.49

4,293

1.38

112,870

36.47

Capital¥10 million

Ownership of theCompany

100%

Representative

Capital¥10 million

322,631

Establishment

December 24, 1979

Ownership of theCompany

0% (100% ownership of The Iyo Bank, Ltd.)—

Location

Description ofbusiness

Investment business for stocks and corporate
bonds, etc., management of investment funds

Representative

1, Minami-Horibata-cho, Matsuyama,
Ehime, Japan
Toshiki Hamaguchi, President andRepresentative Director

Capital¥320 million

Establishment

August 1, 1985

Ownership of theCompany

100%

Location

Description ofbusiness

Investigation and research business regarding industry, economics, and finance;
management consultation service; and educational services such as training

Representative

4-4-3 Minatomachi, Matsuyama,
Ehime, Japan
Kazushige Yano, President andRepresentative Director

Capital¥30 million

Establishment

April 1 1988

Ownership of theCompany

100%

Location

Description ofbusiness

Credit card business, guarantee business

Representative

4-12-1 Sanbancho, Matsuyama,
Ehime, Japan
Makoto Kaneko, President andRepresentative Director

Capital¥50 million

Establishment

August 29, 1988

Ownership of theCompany

100%

Location

Description ofbusiness

Securities business

Representative

9-41 Toiyacho, Matsuyama,
Ehime, Japan
Shuhei Kurita, President andRepresentative Director

Capital¥3,000 million

Establishment

February 2, 2012

Ownership of theCompany

100%

Location

Description ofbusiness

Manufacturing business for office supplies, etc.

Representative

2-2-5 Takasagomachi, Matsuyama,
Ehime, Japan
Seiji Komoda, President andRepresentative Director

Capital¥10 million

Establishment

April 2, 2018

Ownership of theCompany

0% (100% ownership of The Iyo Bank, Ltd.)

Location

1, Minami-Horibata-cho, Matsuyama,
Ehime, Japan
Kazuya Ono, President and Representative
Director

Description ofbusiness

Consulting business, development, sales andmaintenance business of applications

Capital¥200 million

Ownership of theCompany100%

The Iyogin
Business Service
Company Limited

Iyogin CapitalCompany Limited

Iyogin Regional
Economy ResearchCenter, Inc.

Iyogin DC Card
Co., Ltd.

Shikoku Alliance
Securities Co., Ltd.

Iyogin Challenge &Smile Co., Ltd.

Iyogin Digital
Solutions Co., Ltd.

Representative
Establishment
Location

Representative
Establishment

April 3, 2023

¥30 million
100%

Iyogin Holdings Integrated Report 2023

Corporate Data

2. The number of shares held by The Master Trust Bank of Japan, Ltd., associated with trust services is 30,984 thousand shares. The breakdown of which is 30,284 thousand shares in thetrust account and 700 thousand shares in the retirement benefit trust account.

Iyogin Holdings Integrated Report 2023

Consigned information processing business,
software development business

Cash organization and inspection business, large collection business,maintenance and management business of automated cash facilities*1. The number of the shares held by Custody Bank of Japan, Ltd., associated with trust services is 33,811 thousand shares are related to the trust business. The breakdown of which is
27,623 thousand shares in the trust account, 5,759 thousand shares in the retirement benefit trust account, 153 thousand shares in the pension trust account, and 274 thousand sharesin the pension tokkin special pension account (a type of corporate investment fund managed by a trust bank).

107

Description ofbusiness

Description ofbusiness

Ratio of acquired shares tototal number of issued shares(excluding treasury shares) (%)

30,984100%

1, Minami-Horibata-cho, Matsuyama,
Ehime, Japan
Shinichi Doi, President and Representative
Director—

10.92¥80 million

Ownership of theCompany

Credit guarantee business for housing loans andconsumer loans

Status of odd
stocks(number ofshares)33,811

Representative

CapitalSustainability

1-8-12 Harumi, Chuo-ku, Tokyo, Japan
2-11-3 Hamamatsu-cho, Minato-ku,
The Master Trust Bank of Japan, Ltd.
Tokyo, Japan
1-6-6 Marunouchi, Chiyoda-ku, Tokyo,
Nippon Life Insurance Company
Japan
2-1-1 Marunouchi, Chiyoda-ku, Tokyo,
Meiji Yasuda Life Insurance Company
Japan
7-35 Mishimakamiya-cho, Shikokuchuo,
Daio Kaiun Co., Ltd.
Ehime, Japan
Sumitomo Forestry Co., Ltd.
1-3-2 Otemachi, Chiyoda-ku, Tokyo, Japan
Sumitomo Life Insurance Company
2-2-1 Yaesu, Chuo-ku, Tokyo, Japan
Minami-Horibata-cho, Matsuyama,
Employee stock ownership of Iyogin Group 1,
Ehime, Japan
4-4-1 Minatomachi, Matsuyama, Ehime,
IYOTETSU Group Co., Ltd.
Japan
1-26-1 Nishi-Shinjuku, Shinjuku-ku,
Sompo Japan Insurance Inc.
Tokyo, Japan
Total—

2-2-5 Takasagomachi, Matsuyama,
Ehime, Japan
Jun Nitta, President and Representative
Director

Lease business, loan businessBusiness Strategy and Plan for Realizing
the Long-Term Vision

Custody Bank of Japan, Ltd.

Shares held
(thousands of shares)

Location

Description ofbusiness

4-12-1 Sanbancho, Matsuyama,
Description of
Ehime, Japanbusiness
Tetsuya Yagi, President and Representative Capital
Director
Ownership of theSeptember 28, 1978
Company

The Iyogin Credit
Guaranty
Company Limited

Major Shareholders (as of March 31, 2023)
Location

September 26, 1974

100%

Location*Of the 3,919,356 shares of treasury shares, 39,193 units are included in “Individuals and others” and 56 shares are included in “Status of odd stocks.”

Name

Establishment¥20,948 million

Ownership of theCompany

Value Creation Story

Financial
institutions

Financial
instruments
business
operators

Representative

CapitalJanuary 20, 1975

Status of shares (one unit represents 100 shares)

Proportion(%)

Location

Banking business

Establishment

Composition of Shareholders (as of March 31, 2023)

Number ofshareholders(persons)
Number ofshares held(in units)

September 1, 1941

Description ofbusiness

Message from the Management

Consolidated equity ratio (BIS standards)

National
or localgovernmentsof Japan

Establishment¥20,000 million

Listed exchange

Classification

Representative

1, Minami-Horibata-cho, Matsuyama,
Ehime, Japan
Kenji Miyoshi, President(Representative Director)

About the Iyogin Group

Trade name108