Annual Report(April 2001~March 2002)

Financial Highlights (Consolidated)

Mizuho Holdings
2002

2001

Thousands of
U.S. dollars
2002¥ 5,315,591
6,740,762(1,425,170)(976,044)
54,985¥ 5,913,742
5,433,665
480,077
211,260
43,407$ 39,891,867
50,587,334(10,695,467)(7,324,915)
412,650

Millions of yen
For the Fiscal Years ended March 31

Total Income
Total Expenses
Income (Loss) before Income Taxes and Minority Interests
Net Income (Loss)
Cash Dividends

Note: Cash Dividends for the fiscal year ended March 31, 2001 (fiscal 2000) includes “Stock Transfer Payment” which was paid instead of Interim Cash Dividends for fiscal 2000.

2002

2001

Thousands of
U.S. dollars
2002¥ 151,312,427
24,108,931
84,593,656
85,606,236
4,731,420¥ 163,455,480
28,062,563
92,286,772
80,176,482
6,254,270$ 1,135,552,930
180,930,066
634,849,206
642,448,297
35,507,843

2002

2001

U.S. dollars
2002¥ (108,003.27)¥ 20,524.13$ (810.53)

3,500

7,000

26.27

22,5008,200
14,00047,600—42,00011,0008,000
17,5005,380

22,5008,200
14,00047,6007,500
42,00011,0008,000
17,5005,380

168.8661.54
105.07357.22—315.2082.55
60.04
131.33
40.38

2002

2001

2002

10.56%

11.39%/

Millions of yen
At March 31

Total Assets
Securities
Loans and Bills Discounted
Deposits
Total Shareholdes' Equityyen
For the Fiscal Years ended March 31

Per Share
Net Income (Loss) (Common Stock)
Cash Dividends per Share:
Common Stock
Preferred StockFirst Series Class I Preferred Stock
Second Series Class II Preferred Stock
Third Series Class III Preferred Stock
Fourth Series Class IV Preferred Stock
Fifth Series Class V Preferred Stock
Sixth Series Class VI Preferred Stock
Seventh Series Class VII Preferred Stock
Eighth Series Class VIII Preferred Stock
Ninth Series Class IX Preferred Stock
Tenth Series Class X Preferred Stock

Note: 1. Cash Dividends for fiscal 2000 includes “Stock Transfer Payment” which was paid instead of Interim Cash Dividends for fiscal 2000.
2. All the outstanding of Fifth Series Class V Preferred Stock was converted into Common Stock on February 1, 2002.

At March 31

Capital Adequacy
Risk-based Capital Ratio (BIS Capital Ratio)

Ratings
At July 31, 2002

Mizuho Holdings
Mizuho Corporate Bank
Mizuho Bank
Mizuho Securities
Mizuho Trust & Banking

Moody'sLong Term Short Term

—
A3
A3
—
A3

—
P—1
P—1
—
P—1

Standard & Poor's
Long Term Short Term

—
BBB
BBB
—
—

—
A—3
A—3
—
—

Fitch
Long Term Short Term

A—
A—
A—
—
A—

F2
F2
F2
—
F2

R&I
Long Term Short Term

A
A
A
—
A

a—1
a—1
a—1
a—1
a—1

2002 Mizuho Holdings  Annual Report

A Message from the President & CEO of Mizuho Holdings

2

Report on Computer Systems Problems in Japan
Financial Highlights of Mizuho

Management and Business Strategy of Mizuho

13Community Activities of Mizuho

52

Environmental Awareness of Mizuho

Management Structure of Mizuho

55Internal Control Systems of Mizuho

61
Financial Analysis of Mizuho

73
Financial Data of Mizuho Holdings

103
149

Non-Conslidated Financial Statements of Mizuho Holdings
and the Former Five Core Subsidiaries

Senior Executive Officers of Mizuho

162

Office Network of Mizuho
Investor Information on Mizuho Holdings
Disclosure Policy of Mizuho

1

A Message from the President & CEO of Mizuho Holdings

On behalf of the Mizuho Financial Group, I would like to take this opportunity to extend my sincere thanks to our shareholders and customers foryour continued support.
At the same time, I would like to express my deepest regret and apologies for your inconvenience and concern on the Mizuho Financial Group as
the result of our not only having recorded a significant net loss for fiscal
2001 but also causing the computer systems problems in our domestic services, such as ATM services problems and delays in automatic debit transactions in connection with the launching of Mizuho Corporate Bank andTerunobu Maeda
President & CEO, Mizuho Holdings

Mizuho Bank in April 2002. Although operations have been restored tonormal, we are making every effort to implement preventative measures
not to repeat similar problems and to bring further stability to our systems
and business operations. In addition to these efforts, everyone in the groupwill work together to restore confidence in the Mizuho Financial Group as
quickly as possible through providing superior services.
This report is designed to deepen your understanding of our group by
informing you of our new corporate structure, policies and performance.

Inauguration of New Management Structurewith on Four Core Subsidiaries
On April 1, 2002 the Mizuho Financial Group, through a corporate split andmerger process, reorganized the operations of Dai-Ichi Kangyo Bank, Fuji
Bank and Industrial Bank of Japan (the three banks) into Mizuho Corporate
Bank and Mizuho Bank. Mizuho Corporate Bank primarily serves large corporations, financial institutions and their group companies, public sector
entities, and overseas corporations including subsidiaries of Japanese companies. Mizuho Bank's main customer base consists of individuals, domestic
small and medium-sized, and middle market enterprises, and local governments. Mizuho Securities and Mizuho Trust & Banking also became direct
subsidiaries of Mizuho Holdings through corporate splits, creating a new
management structure with four core legally separate subsidiaries. This
structure will secure our advantage by allowing us greater efficiency andflexibility to deal with changes in the business environment while enhanc-

2ing group companies’ expertise responding to customer segments and business lines. We aim to become
a comprehensive financial services group that offers more accurate and rapid responses to our customers’ requirements by ensuring that group companies enhance their expertise and provide high valueadded financial services.

Business Developments and Results
In fiscal 2001, we devoted a great deal of energy to dealing with two major issues: drastic reinforcementof financial strength and reform of our earnings base.
As for drastic reinforcement of financial strength, in light of further deteriorating business sentimentand weak stock market, we made substantial efforts to promptly resolve the non-performing loan (NPL)
issue, establish a financial base that is less vulnerable to stock price fluctuations, and raise capital as wellas improve efficiency in use of risk-adjusted assets.
First, to seek an early resolution of NPLs, which is an urgent management matter, we accelerated final
disposals of NPLs and substantially increased reserves by making stricter self-assessments, and posted
Credit-related Costs of around ¥2,190.0 billion for fiscal 2001 (The figures quoted hereafter are basedon the aggregated figures of the three banks unless otherwise identified.): as a result, at the end of
March 2002, the NPL outstanding balance disclosed under the Financial Reconstruction Law fell byapproximately ¥550.0 billion compared with September 30, 2001, resulting in an improvement in NPL
ratio to total claims.
Second, to build a robust structure that would be less vulnerable to stock price fluctuations under the
mark-to-market accounting system, we reduced our stock portfolio by approximately ¥730.0 billion
through sales of stocks during fiscal 2001. We also disposed of unrealized losses of our stock portfolio
by taking advantage of the accounting profits from the corporate split and merger process of the threebanks at the beginning of fiscal 2002. As a result, net unrealized losses turned into net unrealized gains
at that time. These efforts enabled us to reduce the risk of stock price fluctuations.
Third, in February 2002 we issued preferred securities of ¥356.5 billion to enhance our capitalstrength. Moreover, in order to improve asset efficiency, we reviewed our business portfolio andachieved a reduction of approximately ¥11.0 trillion in risk-adjusted assets through reduction of inefficient and less profitable assets, including sales of stocks, and loan securitization. As a result, our consolidated Risk-based Capital Ratio (BIS Capital Ratio) was maintained at the healthy level or 10.56% at
March 31, 2002.
As for reform of our earnings base, we worked to improve our profitability by raising our loan spreads
and increase our high-quality, profitable assets, including housing loans. We also reinforced fee-based3

A Message from the President & CEO of Mizuho Holdings

business activities and increased our earnings in growth segments such as investment banking, asset
management and syndicated loans. As a result, outstanding balance of residential housing loans at theend of March 2002 increased by approximately ¥520.0 billion from the previous fiscal year. In fiscal
2001, non-interest income from commissions, foreign exchange business and sales of derivatives to customers, etc. also increased by approximately ¥34.0 billion.
During fiscal 2001, we put considerable effort into bringing forward the implementation of key rationalization measures for Mizuho Holdings and the subsidiary banks. Intensive efforts to improve the efficiency of business operations enabled us to reduce the number of employees by over 1,800, whilerevisions of pension and retirement programs and cuts in the bonus pool helped us to make further
reduction in personnel expenses. We also closed 10 domestic branches, three overseas branches andeight overseas subsidiaries.
Although the entire group worked on these management challenges, we posted substantial losses forfiscal 2001 on a consolidated basis, primarily as a result of an increase in Credit-related Costs. Total
Income came to ¥5,315.5 billion, Loss before Income Taxes and Minority Interests to ¥1,425.1 billion,
and Net Loss to ¥976.0 billion. Taking such losses and the need to enhance financial strength into consideration, we regret that the annual dividend for fiscal 2001 was reduced to ¥3,500 per common share.
The dividend payments on preferred stocks were made as originally planned.

Group Challenges
Our principal objective of fiscal 2002 is to continue to reinforce our financial strength and earnings base.
Mizuho Corporate Bank and Mizuho Bank will continue to make appropriate write-offs and provisions
based on strict self-assessments. They will also improve their systems for supporting corporate recovery
and restructuring and for accelerating final disposals of problem loans with a view to resolving the NPL
issue as quickly as possible.
Measures to strengthen our earnings base and seek new earnings opportunities will center on efforts
to improve capital efficiency and increase non-interest income, and reform our cost structure throughthorough restructuring.
Specifically, we will continue to make efforts to improve capital efficiency by further increasing ourloan spreads, which reflect the credit risk of our borrowers, and by boosting housing loans and loan
securitization. To increase our non-interest income, we will seek to diversify our earnings sources by reinforcing fee-based business activities such as advisory business, structuring business and cash management services, and strengthening our endeavors in areas including syndicated loans and project
financing. We attach considerable strategic importance to the securities, investment banking, asset man-4

agement and trust businesses. In addition to improving the quality of our financial services and maximizing synergies among group companies, we plan to nurture those areas into pillars of an efficient earnings structure.
Moreover, our ongoing rationalization program aims to pursue maximum managerial efficiency andcost structure reforms through comprehensive restructuring measures while optimizing our services.

Restore Customer Confidence
In conclusion, we reiterate our deepest regret for the domestic computer systems problems, and ourdetermination as a whole group to make every effort to restore customer confidence as soon as possible.
First, under our new structure where the responsibilities of the president and CEOs of Mizuho
Holdings, Mizuho Corporate Bank and Mizuho Bank have been clearly defined, we will actively work on
the reform of the management to realize a “customer-first,” “speedy” and “open” management.
Further, it is of utmost importance that we respond to our customers’ diversifying needs as well as
perform steady business operations in order to restore their confidence.
By embedding the “customer-first” objective in each and every employee, we ensure that group companies enhance their expertise and provide high value-added comprehensive financial services promptly
while reinforcing cooperation among group companies.
With the reorganization of the three banks to form Mizuho Corporate Bank and Mizuho Bank, themanagement determined to take the initiative to create a sense of innovation among senior executive
officers and employees, and aims to create a new Mizuho corporate culture. At the same time, we will
establish an advisory board consisting of outside experts that will offer objective evaluations and advice
from an independent standpoint, aiming for a more open style of management.
Everyone in the group, from senior executive officers to each and every employee, will unite against
future challenges and be committed to restore the confidence in the Mizuho Financial Group. As President & CEO, I sincerely look forward to the continuing support of our shareholders and customers.
July 2002

Terunobu Maeda
President & CEO, Mizuho Holdings

5

Report on Computer Systems Problems in Japan

We would like to express our deepest apologies to the many customers who have been greatly inconvenienced by the domestic
computer systems problems that occurred in April 2002, such as delays in automatic debit and other transactions at Mizuho
Corporate Bank (MHCB) and Mizuho Bank (MHBK) in connection with the recent systems integration of the Mizuho Financial
Group (MHFG).
Although the computer systems problems inconvenienced our domestic customers, they have had no effect on internationaltransaction services such as settlements. We would also like to reiterate that no problem has occurred in our international operational systems.

Explanation of the Cause and Accountability
The cause of the domestic computer systems problems can be attributed to both inadequate tests and rehearsals of the various
systems, and problems in properly managing the systems integration project.
We must admit that the senior executive officers and employees of MHFG had insufficient awareness of and weak controls
over the operational risks resulting from the systems integration. In retrospect, we recognize that our disclosures of the developments were not prompt and accurate enough.
In recognition of the seriousness of this matter, remuneration for senior executive officers of Mizuho Holdings (MHHD),MHCB and MHBK was reduced by up to 50% for six months starting in July.

Preventive Measures
Further Stabilization of Business Operations
With respect to problems in computer programming and operational mishandling, which were the direct causes of the problems, corrective measures have been taken and we continue to take appropriate measures in order to further stabilize our systems and business operations.

Improvements in Project Management and Systems Development of Group Banks
The management will take the initiative in strengthening project and risk management functions through examining and analyzing the inherent risks associated with our business operations and will reinforce internal controls to prevent the reoccurrence ofproblems. Furthermore, we will establish efficient management for systems development through reviewing the methods ofeach project management. Also, we will strengthen the function of our systems audits by redesigning the organizational structure of internal auditing and by making use of external auditing methods.

Improvements in Functions of Project Management through the Holding Company
MHHD, the holding company, will closely monitor the above project management, and at the same time will strengthen functions of its management by approving important matters related to systems development projects of group banks. Also, MHHD
will strictly supervise group banks by evaluating the results of internal audits, while it plans to introduce external audits to groupcompanies.

Management of Systems Development Projects
As we intend to completely integrate MHBK’s operational systems, learning from the above mentioned problems, all related parties in MHFG will work closely to:(1) complete plans for transfers of operations and continuous monitoring by the management,(2) carry out strict examination of the systems functional requirements, and(3) conduct rehearsals of systems transfer and tests of its effectiveness.
6

Also, in order to bring further stability to business operations, MHHD will conduct stringent internal control over additional
systems development at MHCB.

Restoration of Customer Confidence
Reform of the Management
Under our new structure, the responsibilities of the CEOs of the holding company and the two subsidiary banks have beenclearly defined. With this structure, we will actively work on the reform of the management to realize a “customer-first,”“speedy” and “open” management by reducing the number of senior executive officers and establishing an advisory board consisting of outside experts.

“Customer-First” Objective
We have learned a lot from our customers’ evaluation in the aftermath of the computer systems problems and realized that wehave not yet reached our basic objective of placing our “customer first.” To attain this, every effort shall be made to restore theconfidence of our customers.
To ensure that the “customer-first” objective is embedded in each employee:(1) MHFG has established a personnel evaluation system based on how each employee works towards achieving customer
satisfaction,(2) MHFG will streamline the head office and shift human resources to the area of business promotion which has directcontact with our customers,(3) MHFG will drastically increase the amount of communication between top management and employees, and(4) MHFG will promote policies to focus more on the voice of customers, so that customers’ opinions can be directly
relayed to the management.
At the same time, our public relations activities will place more importance on our customers, and basic rules will be emphasized for quickly disseminating information to our customers in emergencies.

Establishing a New Mizuho Corporate CultureWith the reorganization of the three banks to form MHCB and MHBK, the management determined to take the initiative to create a sense of innovation among senior executive officers and employees, and aims to create a new Mizuho corporate culture.
Specifically, a personnel evaluation system will be put in place in which the following will be stressed:(1) Possessing a “customer-first” corporate objective.
(2) Facing the challenges of innovation.
(3) Being rational and fair in making decisions.
(4) Placing more importance on speed of actions.
(5) Being accountable for all actions.
These values shall be shared by all employees and be the basis for a 360-degree employee performance evaluation.
At the same time, to quickly promote a sense of unity within MHFG and to revitalize the resources of our organization, we
will promote such policies as placing the right employee in the right job irrespective of the employee’s bank of origin, as well asactive transfers of human resources among all group companies.
We will make every effort to bring stability to our systems and business operations and not to repeat similar problems that werecently experienced. Everyone from senior executive officers to each and every employee will work together to restore the confidence of our customers in MHFG as quickly as possible through providing them with superior services.

7

Financial Highlights of Mizuho

Highlights for Fiscal 2001
Net Business Profits (aggregated figures of the three banks), which indicates our core profitability,
increased by ¥175.2 billion from fiscal 2000.
Although the group posted Net Loss as a result of drastic disposal of non-performing loans (NPLs), theconsolidated Risk-based Capital Ratio (BIS Capital Ratio) was maintained at the healthy level of 10.56%.
Outstanding NPLs decreased by ¥554.3 billion from the fiscal 2001 interim period due to theacceleration of the final disposals of NPLs as well as stricter self-assessments.
Reductions in shareholdings and disposal of their unrealized losses by taking advantage of accounting
profits from the corporate split and merger process of the three banks lowered the risk of future stock
price fluctuations.

Profits and Losses
Mizuho Holdings (MHHD) (Consolidated)
Billions of yen

For the Fiscal Years ended March 31

Income (Loss) before Income Taxes and Minority Interests
Net Income (Loss)

2002

Change¥ (1,425.1)(976.0)¥ (1,905.2)(1,187.3)

2002

Change

2001

¥

480.0
211.2

Aggregated Figures of the Three Banks
Billions of yen

For the Fiscal Years ended March 31

Gross Profits
General and Administrative Expenses
Net Business Profits (before Provision (Reversal) of
General Reserve for Possible Losses on Loans)
Credit-related Costs
Net Income (Loss)¥

1,829.9
871.7

¥

190.5
15.2

958.2
2,193.9(909.6)175.2
1,500.0(1,112.2)

2002

Change2001¥

1,639.4
856.4
782.9
693.8
202.6

Mizuho Securities (MHSC) (Non-Consolidated)
Billions of yen

For the Fiscal Years ended March 31

Income (Loss) before Income Taxes
Net Income (Loss)

¥

(4.1)
(6.7)

¥

(1.9)
(5.3)

2001

¥

(2.1)
(1.3)

Mizuho Trust & Banking (MHTB) (Non-Consolidated)
Billions of yen

For the Fiscal Years ended March 31

Income (Loss) before Income Taxes
Net Income (Loss)

2002

¥

(7.0)
(4.0)

Change¥3.1
2.0

Consolidated Risk-Based Capital Ratio (BIS Capital Ratio)
At March 31

BIS Capital
Tier I Capital
Risk-adjusted Assets
BIS Capital Ratio

2002¥ 9,959.9¥ 5,029.1¥ 94,288.9
10.56%

2001¥(10.2)(6.1)

Billions of yen

Change¥ (2,045.0)¥ (1,263.4)¥ (11,029.0)(0.83)%

2001¥ 12,004.9¥ 6,292.6¥ 105,317.9
11.39%

Note : The aggregated figures of the three banks are made up of the simple totals of the non-consolidated results of Dai-Ichi Kangyo Bank (DKB), Fuji Bank (Fuji Bank) and Industrial
Bank of Japan (IBJ).

8• An analysis of the aggregated figures of the three banks that account formost of the consolidated results shows that Net Business Profits, whichindicates our core profitability, increased by ¥175.2 billion from fiscal
2000 to ¥958.2 billion. This was primarily due to the increase of Gross(¥ billions)
1,000•

600•

782.9

800•

806.6

securities and treasury profits, etc.

(Aggregated figures of the three banks)

958.2

Profits by ¥190.5 billion as a result of the rise in interest and dividends on

Net Business Profits (before Provision(Reversal) of General Reserve for
Possible Losses on Loans)

3/20003/2001400•• While General and Administrative Expenses increased by ¥15.2 billion

200•

from fiscal 2000, we made progress in restructuring, including the reduction in the number of directors and employees as well as consolidation

0•

3/2002and closing of offices. General Expenses, from which expenses related tothe consolidation and deposit insurance premiums were excluded,
decreased approximately ¥10.0 billion from fiscal 2000.

Number of Employees(Aggregated figures of the three banks)
34,000•33,631• In light of the stagnating economy and the government's “Front-Loaded
32,000•32,068

Reform Program,” we posted Credit-related Costs of ¥2,193.9 billion asa result of the provision of reserves based on our stricter self-assessments

30,000•28,000•30,262and the acceleration of the final disposals of NPLs.

3/20003/20013/2002• Net Loss (aggregated figures of the three banks) thus was ¥909.6 billion,
and consolidated Net Loss was ¥976.0 billion.
Number of Domestic and Overseas Offices(Aggregated figures of the three banks)• As a result of our putting considerable effort into improving efficiency inthe use of risk-adjusted assets and raising capital of ¥356.5 billion

705
700•

670

649

through preferred securities in February 2002, our consolidated BIS
Capital Ratio was maintained at the healthy level of 10.56% as of March

Overseas Subsidiaries
Overseas Branches
Domestic Branches

600•

31, 2002.
500•

3/20003/20013/2002BIS Capital Ratio (Consolidated)(%)
15.00•
11.60

11.39

10.56

10.00•

5.00•

0.00•

3/20003/20013/20029

Financial Highlights of Mizuho

Status of Non-Performing Loans
Outstanding NPLs disclosed under the Financial Reconstruction Law (FRL) and Status of Coverage
Aggregated Figures of the Three Banks
Billions of yen

At March 31, 2002

ChangeAt September 30, 2001

At March 31, 2001

¥ 5,023.7¥ (554.3)¥ 5,578.0¥ 4,195.6

1,060.3
2,030.1
1,933.2

116.1(86.6)(583.7)944.2
2,116.8
2,517.0805.9
1,613.0
1,776.7

At March 31, 2002

ChangeAt September 30, 2001

At March 31, 2001

Outstanding NPLs disclosed under the FRL
Claims against Bankrupt
and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

Aggregated Figures of the Three Banks
Coverage Ratio(after Direct Write-offs of Category IV Loans)
Claims against Bankrupt
and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

70.6%

0.6%

70.0%

73.3%

100.0
81.0
43.5

—
0.4
(6.3)

100.0
80.6
49.8

100.0
85.4
50.3

Results of Removal of Problem Loans
Aggregated Figures of the Three Banks
Billions of yen

Claims against Bankrupt
and Substantially
Bankrupt Obligors andClaims with Collection Risk

Problem Loans in the 1st Half of FY2000
and Before (Accumulated Problem Loans)
Problem Loans Generated Additionallyin the 2nd Half of FY2000
Problem Loans Generated Additionallyin the 1st Half of FY2001
Problem Loans Generated Additionallyin the 2nd Half of FY2001

At March 31, 2002

Accumulated
Removal¥812.6¥ (1,652.7)

673.9

311.6

(362.3)53.8

1,187.3770.3(416.8)35.1¥ 2,465.4

Total

Removal
Ratio

67.0%

1,195.6

1,195.6———

3,090.4(2,431.8)—

Unrealized Gains and Losses of Other Securities
Aggregated Figures of the Three Banks
Billions of yen

At March 31, 2002 (Stated at mark-to-market)
UnrealizedBook Value
Gains and
Unrealized
Unrealized(=Fair Value)
Losses
Gains
LossesOther Securities
Stocks
Bonds
Others¥ 20,475.0
5,827.5
10,382.2
4,265.1¥ (861.2)(722.7)(15.9)(122.5)¥ 411.7
368.5
12.7
30.4

¥ 1,273.0
1,091.2
28.7
153.0

At March 31, 2001
Unrealized
Gains and
Losses¥ (253.9)(276.6)25.2(2.5)

Unrealized
Gains

Unrealized
Losses¥ 785.4 ¥ 1,039.3
703.2
979.9
37.7
12.5
44.3
46.9

Unrealized Gains and Losses at the Beginning of Fiscal 2002
Aggregated Figures of the Three Banks

Aggregated Figures of Mizuho Corporate
Bank (MHCB) and Mizuho Bank (MHBK)
Billions of yen

Other Securities
StocksBonds / Others10

Note: After changing classification.

At March
31, 2002(A)

Disposal of
Unrealized
Losses (B)After Disposal(A)+(B)¥ (887.5)(748.0)(139.4)¥ 902.6
828.8
73.8¥ 15.180.7(65.6)MHCB

MHBK¥ (7.5)41.9(49.5)¥ 22.738.8(16.0)

• In light of the recent economic environment, we posted Credit-related
Costs of ¥2,193.9 billion during fiscal 2001 because of our stricter selfassessments and the acceleration of final disposals of NPLs.

(Aggregated figures of the three banks)(¥ billions)
6,000•

5,000•

reserves in a specific group of borrowers by taking into account their
4,000•

4,195.6

industry, stock price and credit rating, etc. Pertaining to dealing with the

5,023.7

5,578.0• During the second half of fiscal 2001 in particular, we placed additional

Outstanding NPLs disclosed under the
FRL

Claims against Bankrupt and Substantially Bankrupt Obligors and Claims
with Collection Risk, our efforts in direct write-offs, collection and securi-

3,000•

3/20019/20013/2002

tization resulted in removing NPLs of approximately ¥1,166.0 billion fromour balance sheet.
Accumulated Removal of Problem Loans(Aggregated figures of the three banks)• As a result, outstanding NPLs disclosed under the FRL increased by(¥ billions)
3,000•¥828.0 billion from fiscal 2000 but fell by ¥554.3 billion from the fiscal
2,431.8

2001 interim period to ¥5,023.7 billion. Our coverage ratio against those

2,000•

claims (coverage ratio by reserves, collateral and guarantees, etc.) was
1,000•
720.7

0•3/2001

1,265.9

70.6% as of March 31, 2002.

9/20013/2002• In order to establish a financial base, which cannot be easily influenced
by stock prices, we aimed at reduction of the risk of future stock pricefluctuations.

Reduction of Stock Portfolios(Aggregated figures of the three banks)(¥ trillions)9•• We have reduced our stock portfolio through sales of stocks, and in fiscal
7.5

reduction of approximately ¥730.0 billion.

8•

8.3

2001 further accelerated our efforts to sell off stocks and achieved a

7•

6.6

6•

• As of March 31, 2002, our Net Unrealized Losses on stocks were ¥722.7

5•billion, but by taking advantage of the accounting profits* from the cor-

3/20003/20013/2002porate split and merger process of the three banks, we disposed of over¥800 billion in unrealized losses, resulting in Net Unrealized Gains of¥80.7 billion.
*Overview of the accounting entry made through the corporate split and merger process(page 12).

Change in Unrealized Gains and Losses(Aggregated figures of the three banks)(¥ billions)

80.7

0•

(276.6)(500)•(722.7)(1,000)•3/20013/2002(After disposal of
Unrealized Losses)

11

Financial Highlights of Mizuho

Overview of the Accounting Entry made through the Corporate Split and Merger Process

Shareholders' Equity
Billions of yen

At March 31, 2002 (A)AggregatedFigures of theThree Banks

Common Stock and Preferred Stocks
Capital Surplus
Legal Reserve
Revaluation Reserve for Land, net of Taxes
Retained Earnings (Accumulated Deficit)
After Appropriation for Fiscal 2000
Net Loss, etc.
Net Unrealized Gains (Losses) on Other Securities, net of Taxes
Total Shareholders' Equity

Accounting Entry
made through the
Corporate Split andMerger Process (B)After the Split and Merger Process (A)+(B)
AggregatedFigures of the
MHCB
MHBK
Two Banks¥ 2,571.9
2,247.2
343.5
531.2(85.7)
810.3(896.1)(530.3)¥ (1,391.9)(658.0)—(111.6)
896.1
/
/
536.1

¥ 1,180.0
1,589.1
343.5
419.5
810.3
/
/
5.7

¥

710.0 ¥
655.2
207.7
110.3
486.2
/
/
(7.5)

¥ 5,077.7¥ (729.3)¥ 4,348.4¥ 2,161.9

470.0
933.9
135.7
309.2
324.1
/
/
13.3

¥ 2,186.4

Assets and Liabilities (for reference only)
Status of Assets and Liabilities after the split and meger process is as follows:
MHCB

Billions of yen

AssetsCash and Due from Banks¥ 7,436.4
Call Loans
736.5
Receivables under Resale Agreements
117.2
Other Debt Purchased
120.1
Trading Assets
3,724.5
Money Held in Trust
43.4
Securities
13,795.0
Loans and Bills Discounted
39,626.9
Foreign Exchange Assets
1,001.3
Other Assets
5,386.2
Premises and Equipment
316.7
Deferred Tax Assets
1,131.0
Customer's Liabilities for Acceptances and Gurantees
4,638.0
Reserve for Possible Losses on Loans(970.8)Reserve for Possible Losses on Securities
(2.4)

Total

¥ 77,100.6

MHBK

Billions of Yen

AssetsCash and Due from Banks¥ 18,784.4
Call Loans
113.0
Other Debt Purchased
0.3
Trading Assets
1,622.9
Money Held in Trust
1.5
Securities
9,742.5
Loans and Bills Discounted
40,947.4
Foreign Exchange Assets
167.0
Other Assets
3,024.6
Premises and Equipment
1,256.0
Deferred Debenture Charges
4.0
Deferred Tax Assets
837.6
Customer's Liabilities for Acceptances and Gurantees
1,753.7
Reserve for Possible Losses on Loans(718.6)
Reserve for Possible Losses on Securities(97.4)

Total

Liabilities
Deposits¥ 33,538.7
Negotiable Certificates of Deposit
6,733.1
Debentures
9,350.7
Call Money
4,616.4
Payables under Repurchase Agreements
2,064.5
Bills Sold
956.4
Commercial Paper
194.5
Trading Liabilities
2,486.0
Borrowed Money
3,117.4
Foreign Exchange Liabilities
728.6
Bonds and Notes
653.1
Other Liabilities
5,636.7
Reserve for Bonus Payments
3.4
Reserve for Employee Retirement Benefits
9.9
Reserve for Contingencies
134.2
Deferred Tax Liabilities for Revaluation Reserve for Land
68.8
Acceptances and Guarantees
4,638.0
Total¥ 74,931.0
Total Shareholders' Equity¥ 2,169.5¥ 77,439.4

Liabilities
Deposits¥ 52,528.1
Negotiable Certificates of Deposit
4,520.0
Debentures
6,101.7
Call Money2,820.6
Payables under Repurchase Agreements
330.4
Bills Sold
984.3
Commercial Paper
235.0
Trading Liabilities
1,041.7
Borrowed Money
1,635.6
Foreign Exchange Liabilities
8.0
Other Liabilities
2,988.1
Reserve for Bonus Payments
10.6
Reserve for Employee Retirement Benefits
30.9
Reserve for Possible Losses on Loans Sold
48.2
Reserve for Possible Losses on Support of Specific Borrowers
32.4
Deferred Tax Liabilities for Revaluation Reserve for Land
196.5
Acceptances and Guarantees
1,753.7
Total¥ 75,266.3
Total Shareholders' Equity¥ 2,173.1

Note: The balances are provided for information purposes and therefore differ from those for financial reporting purposes in certain aspects such asother securities valued at cost.
1214

Management and Business Strategy of Mizuho
Business Model of Mizuho

14

Mizuho's Brand Identity

15

Business Outline of Mizuho

16

Major Financial Subsidiaries of Mizuho

18Management and Business Strategyof Mizuho Corporate Bank

20

Management and Business Strategyof Mizuho Bank

30

Management and Business Strategyof Mizuho Securities

42

Management and Business Strategyof Mizuho Trust & Banking

46

Business Results Highlights of Mizuho

50

13

Management and Business Strategy of Mizuho

Business Model of Mizuho

Launch of Legally Separate Subsidiaries Based on Customer Segments and Business LinesOn April 1, 2002, through the corporate split and merger process, the Mizuho Financial Group (MHFG) consolidated and reorganized the operations of DKB, Fuji Bank and IBJ into Mizuho Corporate Bank (MHCB) and Mizuho Bank (MHBK) under Mizuho
Holdings (MHHD). MHCB primarily serves large corporations, financial institutions and their group companies, public sector entities, and overseas corporations including subsidiaries of Japanese companies. MHBK's customer base mainly consists of individuals, domestic small and medium-sized, and middle market enterprises, and local governments. Mizuho Securities (MHSC) andMizuho Trust & Banking (MHTB) also became direct subsidiaries of MHHD through corporate splits, whereby a new organization
centered on four core subsidiaries was created.
We have adopted the above structure to become a comprehensive financial services group that offers accurate and rapid
responses to customer requirements by ensuring that group companies enhance their expertise and provide high value-added
financial services on the one hand, and reinforcing synergistic cooperation among group companies on the other. In this way, we
have realized the most desirable business model in light of the scope and scale of our business, allowing ourselves greater flexibility and mobility in dealing with changes in economic, financial and market structures and other elements of the business environment.
The Consolidation and Reorganization on April 1, 2002
Mizuho Holdings, Inc.
Mizuho Holdings, Inc.

Mizuho Corporate Bank, Ltd.
The Dai-Ichi Kangyo
Bank, Limited (DKB)

The Fuji Bank,
Limited (Fuji Bank)The Industrial Bankof Japan, Limited (IBJ)

Mizuho Bank, Ltd.
Mizuho Securities Co., Ltd.

Mizuho Securities Co., Ltd.

Mizuho Trust & Banking
Co., Ltd.

Mizuho Trust & Banking Co., Ltd.

MHFG's Vision and Management Goals
We have established the following management goals as a means of realizing our future concept of becoming an innovative
financial services group that will lead the new era through cutting-edge, comprehensive financial services.
 One of the top five global banks and the leading financial institution in Japan.
 A top financial group in terms of customer satisfaction.
 A front-runner in information technology (IT) and financial technology (FT).
 No. 1 in domestic commercial banking.
 A market leader in the securities business and investment banking.
 A top-class institution in the trust, asset management and settlement businesses.
 A management structure with best practices.

14

Management and Business Strategy of Mizuho

Mizuho's Brand Identity

Since the founding of MHFG, we have been striving to create a group brand, and in Octoberof 2001 we announced our brand logo.
Going forward, we will use this in our various communication activities with the aim of
spreading Mizuho's brand.

Brand Logo
The new brand logo of MHFG is a simple yet sophisticated logotype in blue
underscored by a striking red arc. The arc represents the sun rising over thehorizon.

Brand Colors
The two colors used in our new identity were created specially for MHFG.
Cosmic blue, as used in the logotype, symbolizes reliability, integrity, world
scale and quality. Horizon red, used for the arc, represents the warm relationships between MHFG and its customers, as well as humanity and pas-Mizuho Cosmic Blue

Mizuho Horizon Redsion.
The new logo therefore represents our employees' commitment and passion in everything they do.

15

Management and Business Strategy of Mizuho

Business Outline of Mizuho
MHFG aims to become a comprehensive financial services group that offers accurate and rapid
responses to diverse needs of customers by ensuring that group companies enhance their expertise andprovide high value-added financial services while reinforcing cooperation among group companies.

Corporate Banking
Business Unit

International Banking
Business Unit

Customers
Large corporations (listed on the firstsections of domestic stock exchanges, etc.)

Customers
Overseas corporations including subsidiaries
of Japanese companies.

Main Businesses• Provide a full range of financial services
and products that make the most of thegroup's comprehensive capabilities.
• Provide optimized solutions for customers'
needs in the areas of management andbusiness strategy.

Main Businesses• Provide highly specialized services thattake regional and industrial circumstances
into consideration and make use of thegroup's global network.

Financial Institutions andPublic Sector Banking
Business Unit
Customers
Financial institutions and their groupcompanies, and public sector entities.
Main Businesses• Provide optimized solutions for funding
and asset management needs,
improvements in operational efficiency,
and establishment of risk management
systems.

MizuhoCorporate Bank(MHCB)

Financial Services Unit
Main Businesses• Provide advanced financial services
tailored to the e-business and the IT era,
yen clearing and yen custody services, andcurrency-related services.
• Provide asset management and trustrelated services utilizing group companies
to offer comprehensive solutions
concerning retirement benefits centeredon defined contribution pension plans.

MHCB focuses its efforts on corporate
finance, primarily serving large
corporations (such as those listed on thefirst sections of domestic stock
exchanges), financial institutions andtheir group companies, public sector
entities, and overseas corporations
including subsidiaries ofJapanese companies.

ALM and Trading
Business Unit

Consumer and Private
Banking Group
Customers
Individuals
Main Businesses• Through a highly convenient distribution
channel network, provide a broad range of
products and optimum services to ourcustomers responding to their individual
needs at specific occasions of life byoffering savings, augmenting, borrowing
and insurance services.
• Provide private banking services making
the most of the group's comprehensive
capabilities.

Trade Services Group
Main Businesses• Support for relationship marketing throughplanning, developing and providing foreignexchange, foreign currency deposits, tradefinance and similar products and services.
• Planning and promotion of correspondentbanking-related business, support forforeign exchange settlements and SWIFTbased transactions.

Main Businesses• Develop and provide interest rate, exchange
rate, securities and other market-related
products and their derivatives.
• Asset and liability management for MHCB.

e-Business Services Group
Main Businesses• Support for relationship marketing throughproviding advanced financial services
tailored to the e-business and the IT era.

Financial Products
Business Unit
Main Businesses• Provide value-added financial services suchas securitization, MBOs and syndicatedloans to meet customers’ needs in theirbusiness and financial strategies by making
full use of cutting-edge financial technologies.
• Bond administration of domestic corporate
bonds and ABSs, etc.

16

Bond Trading

M&A

Securitization Services

IPOs

Structured Finance

Debt Financing

A wholesale securities
company whose customers
are institutional investors,
corporations, financial
institutions and public
corporations.

Customers
Local governments and their affiliatedorganizations and national public sector
entities.

Main Businesses• Provide high-quality finance, andsophisticated products and services.
• Provide solutions that match customers'
business strategies in such areas asinvestment banking services, IPOs as well as
starting overseas operations.
• Support new businesses, venturecompanies and other growth companies.

Mizuho Bank(MHBK)

Main Businesses• Propose efficient financing and asset
management methods.
• Provide reliable and high-quality collecting
services of public charges.
• Propose methods, such as PFIs, to improvethe efficiency of public services.

Trading and ALM GroupThe bank for individuals, domestic
companies and local governments.

Main Businesses• Develop and provide interest rate,exchange rate, securities and other marketrelated products and their derivatives.
• Asset and liability management for MHBK.

Trust and
Asset Management Group
Main Businesses• Provide high value-added asset
management products and services andsupport for relationship marketing throughclose cooperation with group asset
management and trust companies.

MizuhoTrust & Banking(MHTB)

Pension Trust andAsset Management Services

MizuhoSecurities (MHSC)

Customers
Domestic small and medium-sized, andmiddle market enterprises.

Public Sector
Banking Group

Securities and Investment
Banking Group
Main Businesses• Provide high value-added solutions for the
securities and investment banking
businesses, including close cooperation withgroup securities companies and venture
capital company.

Custodial Services

Equities Trading

Equity Financing

Corporate Banking GroupSpecialist in corporate trust
banking business, whose
customers are institutional
investors, corporations,financial institutions
and public corporations.

Stock Transfer
Agency Services

17

Management and Business Strategy of Mizuho

Major Financial Subsidiaries of Mizuho

MHFG provides high-value added comprehensive financial services through the cooperationof major group financial subsidiaries.

Asset Management
Dai-Ichi Kangyo Asset Management
Fuji Investment Management

Overseas Subsidiaries

DLIBJ Asset Management (DIAM)

Banking Subsidiaries
Mizuho Corporate Bank Nederland
Mizuho Corporate Bank (Canada)
The Industrial Bank of Japan Trust Company
The Fuji Bank and Trust Company
Chekiang First Bank
PT. Bank Mizuho Indonesia
etc.

Defined Contribution Plan Services
Trust Banking
Mizuho Asset Trust & Banking
Trust & Custody Services Bank

Securities Subsidiaries
Mizuho International
Mizuho Securities USA
Mizuho Bank (Switzerland)etc.

Securities
Mizuho Investors Securities
Shinko Securities

Mizuho Holdings
Mizuho Corporate Bank
Mizuho Bank
Mizuho Securities
Mizuho Trust & Banking

Trust Banking Subsidiaries
Mizuho Trust & Banking (Luxembourg)
Mizuho Trust & Banking (USA)etc.

Derivatives
Mizuho Capital Markets
Corporation
Othersresearch institutions
credit guarantee companies
leasing companies
etc.
FactoringMizuho Factors
Credit Card
UC CARD
Venture CapitalMizuho Capital

18

19

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Corporate BankA Message from the President & CEO of
Mizuho Corporate Bank

Aiming to Become ”The Best Solutions
Provider” that Uses State-of-the-art Financial
and Information Technologies
Hiroshi Saito
President & CEO,
Mizuho Corporate Bank

Introduction
I would like to start by thanking our shareholders and customers for your continued support. Mizuho Corporate Bank was established as a member of the Mizuho Financial Group,
the world's largest financial group, on April 2002 to serve large corporations, financial institutions and their group companies, public sector entities and overseas corporations including subsidiaries of Japanese corporations.
First, I wish to express my heartfelt apologies for the great inconvenience and concern wecaused by allowing the computer systems problems, which delayed automatic debit transactions and other transactions in Japan at the time of the launching of the Bank. We havemade sincere and wholehearted efforts to make amends for causing difficulties for our customers. All our employees from top management down are united in an all-out effort toprevent any recurrence of such problems, moving quickly to adopt appropriate preventative
measures and working to ensure much higher levels of stability in our systems and operations management. We will also continue our endeavors to regain the confidence of ourcustomers by offering them even better services.

Our Objectives and Basic Strategies
As a result of a rise in bankruptcies and the weakness in the stock market, financial institutions face an increasingly severe environment. Progress in consolidating and reorganizing
major Japanese financial institutions is also exacerbating competition. To cope with this situation, we aim to respond quickly and precisely to our customers' increasingly diverse andsophisticated financial and restructuring needs by becoming the best solutions provider thatuses state-of-the-art financial and information technologies.
We have therefore adopted the following two basic strategies.
• We will strengthen our customer base by pursuing a relationship management (RM) strategy centered on the solutions business.
• We will implement strategic portfolio management.
In pursuing our RM strategy centered on the solutions business, we give the highest priority to strengthening our products and global businesses. In the products business, we use
20

our research capabilities to identify the management issues our customers face in the early stages and use our
products to develop flexible solutions based thereon. We offer products that focus on asset sales, securitization, corporate split, M&A and other aspects of business restructuring, and aim to support customers as apartner in corporate recovery and restructuring. We also intend to boost our non-interest income by strengthening our commissions business in areas like advisory services, structuring business and cash management services.
In the area of global business, we have introduced an overseas regional headquarters system and takenbold steps to delegate authority to local entities so that we can offer highly specialized, locally oriented services that better satisfy our customers' global financial requirements. We provide customers with powerfulsupport for their overseas expansion plans by offering project finance, trade finance, local currency transaction
and other services backed by our advanced financial technology and know-how through our global networkof 18 domestic offices and 75 overseas offices.
In the area of strategic portfolio management, we believe it is essential to compress our balance sheet tothe maximum extent possible. We are reducing our assets by way of stock sales and asset securitization. In theprocess, we will strengthen our distribution capabilities for institutional investors, and work on realizing a business model based on asset turnover and non-asset-dependent arrangement services.
Our pursuit of these two basic strategies is designed to transform our business model by switching fromconventional stock-based management to business flow-based management. We firmly believe that transforming our business model will ultimately lead to an upgrade in our credit rating and put us firmly on track to
become the premier professional bank in the Japanese and international corporate finance markets, providing
the best solutions that truly satisfy the needs of our customers.

Conclusion
Taking to heart the lessons we have learned from the above mentioned problems in our domestic services, wewill make every effort to restore customer confidence through working actively on the reform of the management to realize “customer-first,” “speedy,” and “open” management. Based on our keen awareness thatreforming our corporate culture is an important management challenge, we will work to establish a new corporate ethos, adopting a fair and transparent evaluation system that will help create an organizational climatethat offers attractive and rewarding job opportunities.
We stand ready and determined to regain our customers' confidence and improve our performance by not
only reliably fulfilling our duties, but also focusing the overall capabilities of group companies on providing thehighest quality financial services to satisfy our customers' increasingly complex needs. We look forward to thecontinuing support of our shareholders and customers in these endeavors.
July 2002

Hiroshi Saito
President & CEO, Mizuho Corporate Bank21

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Corporate Bank

Corporate Banking Business Unit
Basic Strategy
1) Build an enhanced full-line service menu that makes the most of the capabilities of MHFG.
2) Serve as a partner in building new businesses and management structures bytaking an active role in supporting customers with their strategic management and business needs through optimized solutions.
3) Provide innovative financial services through the application of cutting-edge
IT and FT.
4) Create a strategic portfolio based on a high level of managerial know-how.

Enhance a Full Range of Services based on Close Group
Cooperation
The Corporate Banking Business Unit (BU) serves primarily large Japanese corporations,amounting to around 70% of all listed companies in Japan, and their group companies. We make use of the specialist functions of MHFG companies and the group's network of offices in Japan and overseas to offer optimized solutions for these large
corporations’ advanced and sophisticated needs.
Development of One to One Marketing with the Responsibility for Total
Relationship Management
This BU deploys corporate finance professionals with advanced knowledge of the field
at 43 business promotion divisions in 18 offices that exclusively serve customers
throughout Japan, where they engage in “one to one marketing” activities carefully
tailored to the needs of individual corporate customers. By coordinating the financial
services and capabilities of group companies such as MHBK, MHSC and MHTB, we are
Loans to Large Corporations

able to offer optimum solutions for our customers' increasingly complex and sophisti-(Aggregated figures of the three banks; as of March
31, 2002)

cated requirements.
More specifically, we not only provide loans but also provide a wide range of high(¥ trillions)
40•

MHFG
Mitsubishi Tokyo
Financial Group (MTFG)

30•
24.5

20•

value-added financial services that are carefully coordinated through cooperation of
specialist financial capabilities of the group. Such services include high-value financing

Sumitomo Mitsui
Banking Corp (SMBC)

that uses off-balance sheet schemes such as asset securitization, investment banking

UFJ Group(UFJ)(M&A, MBO finance, project finance, etc.) as well as syndicated loans, derivatives, fund10•

settlements, corporate retail (services for corporate customers’ employees), and stocktransfer agency.

0•

Source: Preliminary financial results for fiscal 2001.
Researched by MHHDAs the liaison between large corporations and MHFG, this BU represents the groupthrough its responsibility for total relationship management (RM).
Provide Advanced Finance that Utilizes Our Customer Base and Sophisticated,
Specialized Financial Functions
In recent years, the corporate finance sector has experienced a rapid expansion in market-oriented and indirect finance tools such as syndicated loans. Financial institutions
are now expected not only to provide companies with loans on a bilateral basis, butalso to fulfill a new financial intermediation function in bringing together investors andcompanies in the market.
We have already secured a place as the market leader in arranging domestic syndi-

22cated loans with a market share of 44% of the total (aggregated percentage of DaiIchi Kangyo Bank, Fuji Bank and Industrial Bank of Japan (the three banks) for fiscal
2001). Further sharp expansion is expected in the syndicated loan business, and weare working on strengthening our transactions in this area through our customer base,which is the largest of any Japanese financial group, and our extensive network of
institutional investors, including financial institutions.
We also have an excellent reputation in areas like asset/liability securitization andstructured finance, where high-level arrangement capabilities are required. Drawing on
the specialist skills of MHSC and other group companies, we offer a wide range ofadvanced financing schemes.
Provide Financial Services through the Application of Cutting-Edge IT
We have launched our new Internet-based Mizuho Advanced Cash Management
Service (CMS) and Global CMS. Through our advanced cash management networks,
we support customers in improving their financial efficiency and assist them with managing their group accounts on a consolidated basis. We are also working actively to
expand our IT-based business infrastructure, using trade finance electronic data interchange (EDI) and the electronic commerce infrastructure.

Development of Financial Services Centered on AdvisoryType Solutions
This BU has a section which surveys trends by industry in Japan and overseas called theIndustry Research Division. Making the most of these specialist functions enables us toprovide customers solutions that fit in with their business strategies and management
priorities by taking industrial trends and the business environment into consideration.
Provide Advice and Solutions for Business Strategies and Financial
Restructuring
To support customers to realize their business strategies such as restructuring existing
businesses and expanding business into new areas, we provide solutions including
M&A advisory services as well as non-recourse loans, project finance and other formsof structured finance.
The need for financial restructuring through balance sheet controls and other measures is also increasing in line with changes in the consolidated accounting standards
and the introduction of accounting standards for financial instruments, as well as
greater emphasis on management issues such as focusing on cash flow and theenhancement of enterprise and shareholder value. To support customers to resolvethese issues, we offer solutions for reduction of assets using asset securitization andother off-balance-sheet schemes, as well as for improving cash management and theefficiency of fund operations at group level.

Enhanced Support for Overseas Subsidiaries of JapaneseCompanies~ Using the Know-How Accumulated through the Group's Powerful Global Network ~We dynamically support the overseas business activities of our customers by providing
an extensive range of locally-oriented services that are integrated seamlessly with theirtransactions in Japan. In particular, we are in a position to provide customers with optimized financial schemes in a timely manner utilizing our accurate information and23

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Corporate Bankknow-how pertaining to expanding business into foreign markets and overseas investments that we have accumulated through the group's overseas office network overmany years.
We are able to provide all-round support functions, from advice on overseas market
entry, merger contracts, business expansion and other matters pertaining to corporate
structure, to investment promotion schemes and surveys on environmental factors
such as legal and taxation systems. As a result, we offer the best possible solutions for
progressive customers in the areas of globalization, cross-border strategies and othercomplex issues.
Support for Customers’ Business Development in China
In recent years we have seen a major upsurge in our customers' need for assistance indeveloping their businesses in China. We are able to provide broad-ranging support
through our branch network which is the largest of any Japanese bank, a strong pastrecord and ample experience in advisory services. These enable us to provide high-level
Global Syndicated Loan Arrangers(Amounts arranged; aggregated figures of the threebanks; January 1~December 31, 2001)
RankingAmount(US$ million)

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

252,196.0
222,360.6
215,275.4
86,059.9
67,171.8
66,140.2
63,562.2
49,810.1
46,618.7
46,142.8
44,304.4
44,204.8
39,921.4
38,074.8
37,303.9
34,850.0
33,663.9
27,639.8
25,797.5
25,233.9

JP Morgan
Citigroup/Salomon Smith Barney
Bank of America
Deutsche BankMHFGBankOneBarclays Capital
ABN AMROBNP Paribas
FleetBoston
Wachovia Bank
Bank of Tokyo-Mitsubishi
CSFB (Credit Suisse First Boston)Bank of Nova Scotia
Commerzbank
RBS (Royal Bank of Scotland)
HSBC (Hongkong Shanghai Banking Corp.)
SMBC
Bank of New York
Westdeutsche Landesbank

responses ranging from initial business development planning to upgrading local operations in China.

International Banking Business Unit
Basic Strategy
Using our powerful overseas network, we deliver best solutions to customers
engaged in business at the global level.
1) Provide advanced financial products that satisfy customers' requirements.
2) Offer solutions that make the most of our strong past record and businessbase in overseas financial markets.
3) Utilize our overseas office network to offer multifaceted assistance for global
businesses.

Strategy for Asian Markets

Source: IFR, January 5, 2002

Asia is our home ground. In addition to dealings with a large number of Japanese
Global Project Finance Arrangers(Amounts arranged; aggregated figures of the threebanks; January 1~December 31, 2001)
Amount No.of
Ranking(US$ million) Deals

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Citigroup
Westdeutsche Landesbank
BNP Paribas
Societe Generale
CSFB (Credit Suisse First Boston)
JP Morgan
Dresdner Kleinwort Wasserstein
ABN AMRO
Deutsche Bank
Barclays BankMHFG
IntesaBci
Bank of America
Credit Lyonnais
Royal Bank of Scotland
Skandinaviska Enskilda Banken
Bank of Tokyo-Mitsubishi
Australia and New Zealand Banking Group
Santander Central Hispano
Credit Agricole Indosuez

Source: PFI, January 23, 2002

24

15,512
8,235
6,429
5,301
4,742
4,333
4,038
4,019
3,623
3,612
3,187
2,621
2,282
2,019
1,911
1,582
1,573
1,532
1,465
1,366

54
27
21
17
8
18
17
19
14
18
20
5
13
12
16
2
11
12
10
10

companies that have expanded their operations in the region, we work with major
local companies and European and U.S. multinationals. We draw on our rich experience and advanced FT to provide high value-added services in specialized areas such as
syndicated loans, project finance, trade finance and cash management. We aim tobecome the leading financial group in Asia by winning our customers' trust, and tocontribute to the region's economic growth.

Strategy for the American and European Markets
Our goal is to secure a top-tier position in the world's leading financial markets. We
have deployed industrial sector-based professionals and specialists in products such as
project finance, structured finance, leasing, securitization and derivatives in New York
covering the Americas and London covering Europe, where they can give full rein to
their expertise.
The U.S. is the world's largest and most advanced financial market, which we continue to see as a vitally important market. We are working hard to develop our busi-

ness activities there on the basis of our strong experience and past record, as well as
our advanced financial technologies.
In Europe, the birth of the euro zone has further encouraged the ongoing trend
towards cross border industrial restructuring and M&As. We support European businesses facing these developments, including companies in Central and Eastern Europe,by providing high value-added financial products such as derivatives, and the arrangement of MBOs.

Support for Japanese Companies entering Foreign Markets
Our international office network serves as a powerful tool for providing Japanese companies with support for their overseas business strategies. Since Japanese companies
continue to expand their business in Asia at a rapid pace, our offices in 25 major Asian
cities, especially those in 10 cities on the Chinese mainland, are ideally placed to provide advisory services on expanding their businesses and highly specialized services.
Among other things, our expert staff can provide advice on various forms of financing,settlement services, risk hedging, trade finance and other advanced financial and information services.
* Please refer to page 163 for details of our overseas network.

Support for Non-Japanese Companies Expanding Their
Business in Japan and Asia
We are strengthening our support for U.S. and European multinationals expanding
their business in Japan and Asia, devoting efforts to projects involving Fortune 500
companies that are opening up operations in Asia or sponsoring local corporations. As
the financial group that knows Asia the best, we aim to become the "best partner" forcompanies in the region.

Products BusinessIn order to be able to provide customers with leading-edge products, we are striving tostrengthen our global products business. In the area of project finance, we haveearned an excellent reputation in the markets for our work as a financial advisor and/or
arranger in numerous projects. We have also served as the lead manager(arranger/agent) in many syndicated loan deals around the world, securing for ourselves a high ranking in the annual league tables of the world's leading banks.

Financial Institutions and Public Sector Banking Business Unit
Financial Institutions
Basic Strategy
Offer optimized solutions for Japanese financial institutions' varied financial
needs and management challenges.

Responding to Financial Needs
In order to respond with precision to the increasingly complex financial needs of financial institutions, we not only provide mainstay products such as bank debentures (sub25

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Corporate Bank

scription bonds) but, in cooperation with group companies, also devise tailor-madeinvestment trusts and devote considerable effort to formulating proposals for securitized products, which require sophisticated arrangement capabilities.
As the "best partner" for managing the assets of financial institutions, we provide awide range of products and services and are involved in referrals in connection witharranging domestic syndicated loan deals, an area in which we boast a substantial
share of the market.

Development of the Solutions BusinessWe are working proactively to provide high value-added solutions in connection with
the increasingly complex and diverse managerial and financial strategies of financial
institutions, in the process drawing on the comprehensive financial service capabilitiesof the group.
More specifically, we provide management advice pertaining to mergers and consolidations of financial institutions and are actively engaged in drawing up proposals that
contribute to the upgrading of credit and market risk management and the reinforcement and streamlining of asset portfolio management and other internal management
systems.
To respond to the need for outsourcing as a way of improving operational efficiency,
we devote considerable effort to providing assistance in managing securities and otherassets, foreign exchange (yen) settlements, and foreign exchange (yen) clearing services for import/export and overseas remittances. In the defined contribution pension
plan business, we also draw up proposals to provide convenient support services forparticipants.

Public Sector Entities
Basic Strategy
1) Promote RM with customers that are special public corporations or authorizedcorporations, and administrative work associated with issues of public bonds.
2) Draw on MHFG's total resources to offer rapid and timely solutions to theincreasingly diverse and sophisticated financial challenges that customers
face as a result of institutional reforms and deregulation.
MHFG’s Participation in FILP
Agency Bond Issues
Number of Issues Entrusted (Fiscal 2001)

Responding to Funding Needs~ Expand the Public Bond Business ~Bond issues are an important source of funding for our customers among public corporations and governmental financial institutions. Since we have established a number
MIZUHO

Mizuho’s share:
Approximately 75%(No.1 in the sector)of advantages and strengths in the area of securities-related services associated withissues of public bonds, our experience and record in connection with activities as commissional bank and underwriting of government-guaranteed bonds and publicly issued

Number of Lead-manager Transactions
Mizuho’s share*:Approximately 42%
MIZUHO (No.1 in the sector)

local government bonds surpasses that of other Japanese financial groups.
As a result of the reforms of the Fiscal Investment and Loan Program (FILP) that took
place during last fiscal year, special public corporations and similar bodies have started*Number of transactions of MHSC

placing greater emphasis on private financing, and a new type of access to market
finance has emerged in the form of FILP agency bond issues. We were the first group26

to complete preparations in readiness for this and achieved excellent results in fiscal

Glossary

2001, the first year of such issues. In fiscal 2002, we expect the number of issues toReform of the FILP and FILP Agency Bonds

increase markedly over the preceding year, and are working to establish ourselves as

Under legislation relating to the reform of the FILP,
the system whereby all postal savings and pension
reserves were deposited with the Trust Fund Bureauof the Ministry of Finance, the program has beenabolished. Since April 2001, a new framework has
been put in place whereby these funds andreserves are to be invested autonomously throughfinancial markets, while special public corporations
and other organizations are to raise necessary
funds in the market.
FILP Agency Bonds are issued without guarantees
of government by individual special public corporations and other governmental institutions in private
sector financial markets.

the market leader by continuing to strengthen our framework for handling these issues
with a view to responding to customer needs faster and in a timelier manner.

Development of the Solutions BusinessAs a result of the ongoing reforms of the FILP, special public corporations and administrative frameworks, the needs of public sector entities are rapidly diversifying. To satisfy
these needs, we are proactively applying the research and advisory capabilities, and thecutting-edge financial technologies and know-how of the group in the areas such as
assigning of ratings by rating agencies, preparations for privatization, and securitization of assets.
Looking ahead, we remain committed to providing the best quality financial services
to meet the constantly changing needs of our customers.

ALM and Trading Business Unit
Basic Strategy
1) Offer optimized solutions for customers' complex risk control requirements.
2) Comprehensive asset and liability management (ALM) through precise risk
management and flexible operations for MHCB.

Market Operations: Sales and Trading
Our sales and trading team ranks among the largest of any Japanese bank and boasts
an excellent past record. As the pillar of our business strategy in the investment banking business, it formulates various kinds of proposals concerning funding and fundmanagement schemes and risk management for a wide range of customers, from corporations to institutional investors.
More specifically, it seeks to satisfy customers' financial and business risk control

Overseas Dealing Roomrequirements by offering risk hedging schemes and other optimized solutions. In addition to foreign exchange and interest rate derivatives, it uses cutting-edge FT to devise
a broad line-up of derivative products whose underlying assets include crude oil andother commodities, credit, weather and equities.
In order to provide these high-quality services, we have established a global systemthrough our network linking the five key markets—Tokyo, New York, London, Singaporeand Hong Kong. Here, we engage in market-making and trading in foreign exchange,
currency options and interest rate swaps, based on a careful and detailed grasp ofinter-market price movements and governed by precise risk management procedures.

Using Advanced FTBanking Operations: ALM
We carefully manage the interest rate risk and liquidity risk associated with our portfolios, which comprise the assets we hold, including loans, yen and foreign currencydenominated securities, as well as liabilities like deposits and bank debentures. These
effective risk controls make flexible use of derivatives and other transactions, andenable us to ensure a stronger, more stable earnings structure.
27

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Corporate Bank

Financial Products Business Unit
Basic Strategy
Centering on financing, develop and provide products and services to support
customers’ business and financial strategies by making use of cutting-edge financial technologies.

Asset-Backed Securities Business for Customers
Our excellent past record in handling ABCP and a wide range of other structured
finance products puts us in the ideal position to support customers in realizing optimal
financial strategies centered on securitization of monetary claims, thus satisfying theirfunding needs while using asset securitization to improve their management indices.

Real Estate Finance Business
We utilize the best technological capabilities in the business to support customers in
optimizing financial strategies in the area of real estate assets, ranging from real estate
Glossary

non-recourse loans, support and advice on real estate development projects to han-Accounting for Impairment of Fixed Assets

dling accounting for impairment of fixed assets.

An accounting method that is being considered for
application starting in fiscal 2005 by which thebook value of a fixed asset is treated as a loss when
it becomes impossible to expect recovery of theamount of initial investment due to the fall in the
profitability of the fixed asset.

DIP Financing (Debtor-in-possession
Financing)
A method of providing companies that have filed
for bankruptcy protection with the working capitalnecessary to continue operations.

Acquisition Finance BusinessCentered on MBOs, we support customers to build the most appropriate businessportfolio for their needs through a "one-stop-service" structure embracing advisory,
finance and investment services provided by our team of MBO professionals.

Corporate Recovery BusinessWe are one of the first Japanese banks to tackle debtor-in-prossession financing (DIP
financing) and aim to offer companies in the process of recovery with the most effec-

Arrangement of Domestic
Syndicated Loans(Amount arranged; aggregated figures of the threebanks; January 1~December 31, 2001)

tive support available in this area.

Syndication

Others 17%
MHFG 44%
US$ 40.7 billion

Citigroup 5%
US$ 4.4 billion

MIZUHO

trillion in fiscal 2001, making it the third largest market in the world behind the U.S.
and the U.K.

SMBC 16%
US$ 14.6 billion
Source: IFR

The syndication market in Japan has grown rapidly and was worth approximately ¥12

MTFG 18%
US$ 17.0 billion

MHFG accounts for approximately 44% of the total for Japan (aggregated percentage of the three banks for 2001), and we have by far the best record in arrangementof domestic syndicated loans.

Administration of Domestic
Public Corporate Bonds(Aggregated figures of the three banks; fiscal 2001)

Others 9%
UFJ 5%¥ 314.0 billion

MHFG 44%¥ 2,979.5 billion

tutional investors at home and abroad to offer the best-priced solutions for customers'
diversifying funding requirements.

Bond Administration
MIZUHOMTFG 12%¥ 776.0 billion

We have built up an overwhelming market position in bond administration services
relating to corporate bonds and ABSs.

SMBC 30%¥ 2,014.0 billion
Source: Researched by MHCB

28

Looking ahead, we will make the most of our strong relationships with leading insti-

We will make full use of the best operational set-up in the business to provide customers with top-class services that satisfy their requirements.

Financial Services Unit
Basic Strategy
1) Secure a position as a front-runner in the field of defined contribution pension plans.
2) Build up the yen clearing and yen custody businesses by centralizing settlement operations and using IT more extensively.
3) Increase efficiency of exchange-related business and expand operations
insourcing business.
4) Expand sales of domestic and global CMS and establish a de facto standard
for next-generation settlement business.

Asset Management
Defined Contribution Pension Business and Asset Investment Solutions
We propose comprehensive solutions pertaining to retirement benefits centered on
defined contribution pensions, providing pension consulting services and investment

Custody and Foreign Exchange
Yen Clearing Business(Aggregated figures of the three banks; as of March
31, 2002)

Yen Custody Assetsof Foreign Investors

products, and support for participants through Defined Contribution Plan Services. We
also arrange and sell privately placed investment trusts to our corporate customers andMIZUHO

Mizuho’s share: 45%

provide asset investment services through group companies.
Trust-Related Business
As an agent for MHTB, we provide trust products associated with pension trusts, asset(No.1 among Japanese banks)

Number of Foreign Exchange (Yen Clearing)
Agency Settlement Transactions
Mizuho’s share: 32%

investment, custodial services, stock transfer agency services and securitization through(No.1 among Japanese banks)
MIZUHO

all our branches throughout Japan. We also provide master trust and other asset management services through the Trust & Custody Services Bank.

Clearing & Settlement

GlossaryThanks to our solid customer base, we were the number one bank for foreign

Securities Settlement System Reform

exchange yen clearing business (aggregated figures of the three banks for fiscal 2001).

The Financial System Council of the Ministry of
Finance and the Japan Securities Dealers
Association (JSDA) studied the issue in 1999. The
results of their deliberations form the basis of thesystem reform program now underway. The key
features of this reform process are the introductionof DVP (Delivery versus Payment) settlements,
whereby the securities and funds involved in atransaction are settled simultaneously, and T+1 settlements (settlement on the first business day after
the transaction date.)

Against this background, we are working to increase our non-interest income by providing cutting-edge products and services associated with yen clearing services.
Moreover, with our overwhelming market share as the top Japanese custodian bankwith strengths in both stocks and bonds, we are leading the way in the reform of securities settlement systems in readiness for globalization, building the group's settlement
system infrastructure that anticipates the shift to a shorter settlement cycle (T+1: settlement on the first business day after the transaction date).

Trade Finance EDI

Foreign Exchange
We provide various solutions to our customers who wish to hedge foreign exchangerisk. We have also established the trade finance EDI firm World Gateway together with

To improve the efficiency of trade operations
through the use of electronic documentation, we
participate enthusiastically in global projects such as
Bolero and TEDI as a means of strengthening ourcross-border settlement capabilities.

trading companies and others with whom we have close business ties, and proactively
support steps to improve the efficiency of customers' trade operations using computerized tools like Bolero and TEDI.

e-BusinessWe provide Internet-based domestic and global CMS as a solution to customers' needs
for more efficient cash management, which have grown rapidly in recent years. We arealso strengthening cooperation and alliances with leading software vendors and otherpartners as part of our active efforts to engage in new sectors such as electronic certification and B2B business.

Global CMS Web pages

29

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho BankA Message from the President & CEO of Mizuho Bank

Aiming to Become the Customer's Bank of
Choice and Best Business Partner
Tadashi Kudo
President & CEO,
Mizuho Bank

Introduction
I would like to start by thanking our shareholders and customers for your continued support. Mizuho Bank was launched on April 1, 2002 to provide banking services to customers
consisting primarily of individuals, domestic small and medium-sized, and middle market
enterprises, and local governments. I would like to take this opportunity to thank our customers, shareholders and other stakeholders sincerely for their support and cooperation at
this time.
First of all, I would like to express my deepest apologies for the computer systems problems in our domestic services including ATM services and delays in automatic debit transactions in connection with the launching of Mizuho Bank and Mizuho Corporate Bank in
April 2002. We will make every effort to establish a preventative structure in order not torepeat similar problems. Further, we will work together to restore confidence in our bankand group through placing our “customer-first” objective in everyone in the group.

Our Strengths and Objectives
Mizuho Bank started operations with three major advantages. First, we possess one of thelargest domestic networks of any Japanese bank, and offer all-round banking services of
the highest caliber in areas ranging from traditional commercial banking operations andsupport for overseas expansion through international banking operations to leading-edge
securities and investment banking services. Second, we have many professionals who offer
an extremely high degree of specialization. Third, we have the closest customer relationships of any bank in Japan. While exploiting these three advantages to the maximum, ouraim is to overcome the challenges we face and realize our objectives: to become the customer's bank of choice and best business partner by providing comprehensive, high valueadded financial services and achieving the highest levels of customer satisfaction.

Achieving Our Objectives
We must address the following challenges in order to achieve our objectives.
The first is “placing the customer first and placing importance on business promotion atbranches.” Taking advantage of our extensive network as the key point of contact with ourcustomers, our entire staff will constantly do their best to satisfy our customers, providing

30

meticulously tailored services as a means of developing closer relationships with them. This, in turn, implies
greater support for business promotion at branches, which constitute our principal interface with customers.
Second, we will establish high value-added management methods by maximizing the strengths of Mizuho
Financial Group and Mizuho Bank. In addition to rigorous efforts to strengthen the business sectors where wecan attain top position, we will increase cooperation among our group companies and work even harder togrow our cutting-edge solutions businesses in areas such as securities and investment banking.
Third, we will pursue greater management efficiency through bold, speedy and aggressive management
restructuring. We will endeavor to increase the management efficiency of our branches as well as administrative divisions at head office while speeding up non-performing loan disposals and providing customers withstronger support for corporate recovery. We will also increase our loan spreads which reflect the credit risk ofour borrowers.
Fourth, we will establish a corporate culture that encourages taking on challenges, and train humanresources with a high degree of specialization. In addition to building a multifaceted framework for fostering
human resources, we will reinforce employees’ knowledge and upgrade their skills in areas such as solutions
businesses.

Satisur Customers
I would now like to touch on our concrete strategies.
For our individual customers, we will offer products and services that are tailored to their diversified financial
needs, expand a more convenient channel network, and take advantage of the group's comprehensive capabilities to provide high-quality private banking services.
For our corporate customers, we will provide cutting-edge solutions that match their specific business andfinancial strategies in areas such as high-quality funding and investment banking business, syndicated loans,derivatives, IPOs and support for overseas expansion. We will also focus on supporting new businesses, venture companies and other growth companies.
As for our local government customers, we will offer and implement proposals for satisfying the increasingly
diverse and sophisticated challenges they face as a result of institutional reforms and deregulation. These proposals will cover efficient financing and asset management methods and measures to increase the efficiencyof public services, such as PFIs, through drawing on our nationwide branch network and our high-level securities-related services and state-of-the-art financial technology.
Everyone from senior executive officers to each and every employee will work together to restore confidence in Mizuho Bank and the Mizuho Financial Group. We look forward to the continuing support of ourshareholders and customers.
July 2002

Tadashi Kudo
President & CEO, Mizuho Bank

31

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Bank

Consumer and Private Banking Group
Basic Strategy
Our goal is to become the customer's bank of choice by fully satisfying themthroughout their lives.
1) Promote and reinforce relationship marketing (RM).
— We will make a thoroughgoing effort to satisfy customers by creating a business promotion structure that can provide the best products and services foreach individual, and identify and respond to their needs quickly and accurately.
2) Focusing on selected strategic markets.
— We will establish our competitive advantage by reinforcing our approach tobusiness areas where we have secured strength, such as housing loans, corporate retail business, Takarakuji lottery tickets and new areas such as insurance.
3) Realize greater efficiency in marketing.
— We will expand our ATM and remote channel networks to increase convenience while simultaneously raising the efficiency of in-house operations by
cutting costs.

Providing High-Value-Added Services through RelationshipMarketingMembership-Style Banking Service— “The Mizuho Value Program”
In April 2002, we started offering a new membership service called the Mizuho Value
Program. The program is designed to support and satisfy customers throughout theirlives by fulfilling the varied needs of their life stages or life styles. Currently we haveapproximately 6.4 million highly satisfied members in this program, which is also themost efficient and effective communication tool with them, and we recognize this as
one of our strengths.
Databases
Number of Customers Utilizing
Membership-Style Banking
Services

We will continue to expand databases that can be accessed and additional data can beaccumulated into through various channels by collecting and accumulating various(Aggregated figures of the three banks)

kinds of customer information. At the same time, we will make use of the information(customers in millions)7•

extrapolated from our databases to ensure that our business structure provides individual customers the best possible responses and services.

6•

Private Banking

5•

We will strengthen our ties of trust with customers in order to become their partners

4•

into the next generation by satisfying their diverse needs.
3•

Our highly experienced and specialized staff will offer global economic and financial

2•

information on a timely basis. We will also provide tailored asset management and1•administration services, including products and services that make the most of the0•

Sept. 2000 Mar. 2001 Sept. 2001 Mar. 2002

group's comprehensive capabilities in areas such as securities, trusts, overseas investments and real estate.

32

In cooperation with lawyers, tax accountants, accountants and other specialists, wewill work together with customers to devise asset preservation and inheritance plans todeal with one of life's most important themes—the smooth succession of assets andbusinesses built up over many years to the next generation in accordance with eachindividual customer's wishes.

Providing Products and Services Tailored to the Customer'sStage in Life
Asset Management Advisory Services~ From yen deposit and bank debentures to foreign currency deposits andinvestment trusts ~To cope with the removal of the deposit guarantee in April 2002, we have been working to create a range of high-quality products to satisfy the increasingly diversified
needs of customers. We have also expanded our force of highly trained specialized
staff to provide asset management advisory services that extend from portfolio proposals to after-care that fit perfectly with individual customers' life plans.
Housing Loans
We offer an extensive range of housing loans to match the house ownership plans ofcustomers, and all of these products feature a high degree of flexibility, allowing customers to specify repayment amounts according to their stage in life as well as choose
from three interest methods. We will establish a framework that will allow us to provide customers with speedier, more appropriate advice by strengthening cooperation

Outstanding Balance ofResidential Housing Loans(Aggregated figures of the three banks)(¥ billions)
9,000•
8,800•

between our nationwide chain of full-service branches and housing loan business promotion centers, and real estate companies.
Retail Business Aimed at Corporate Employees

8,600•
8,400•

One of our strengths is our corporate customer base. Drawing on our years of special-

8,200•

ist know-how and the wide range of loan and asset-formation products we provide

8,000•

and by cooperating with group companies, we will meet corporate management

7,800•

needs associated with in-house administrative rationalization and employee benefits,
and corporate employees’ needs for more convenient services to them.

7,600•

Sept. 2000 Mar. 2001 Sept. 2001 Mar. 2002

Card Business
The three credit card companies of the three banks have integrated their operations
with those of UC CARD. UC CARD now serves as the group's comprehensive credit
card company, serving customers of group companies while working proactively todevelop new markets.

Mizuho UC Cards

Multi-Channel Networks
With our nationwide network of full-service branches, we continue to offer customers
greater convenience by expanding the number of close-to-customer, easy-to-use transaction counters at our in-store branches—branches established within the premises ofsupermarkets and the like. As of April 1, 2002, we had ATMs in approximately 5,700
locations, including joint-use ATMs established through tie-up agreements with convenience stores, and are actively working to expand this network.
Already, approximately three million people use our telephone and Internet banking
services, and we are proactively developing original new services such as sales of33

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Bank

Takarakuji lottery tickets, advanced settlement services and PDA (Personal Digital
Assistants) banking services. We have also led the way in starting a new service called
Pay-easy which allows customers to pay taxes and utility charges using ATMs and theInternet.
Takarakuji Lotteries

PDA Banking Screen

We have been entrusted with operation of Takarakuji lotteries by all prefectures and
12 designated cities in Japan. As the "Takarakuji Bank," we shall respond to customers' needs by making the most of our nationwide network of full-service branches,
further increasing the number of sales outlets of Takarakuji lottery tickets, and developing sales through new sales channels such as ATMs and the Internet.

Corporate Banking Group
Basic Strategy
Promote solutions business.
~ Aiming to become our customers' strategic partner ~1) Provide ample funds to SMEs, which are the backbone of the Japanese economy.
2) Reinforce our capabilities for finding solutions to customers' management
issues and make strategic use of IT.
3) Provide high value-added services by maximizing the strengths of MHFG and
MHBK.
4) Build an efficient, high-quality business promotion structure.

Proactive Response to Healthy Demand for Funds of SMEs
Respond Positively to Financing Needs

Loans to Domestic SMEs
(Aggregated figures of the three banks; as of March
31, 2002)(¥ trillions)
40•
34

30•

As the “best partner” of SMEs that are the backbone of the Japanese economy, we
will serve our customers as a reliable source of smooth and stable funds to meet sound

MHFG
SMBC

financing needs.
Develop New Markets and Customers Base

UFJ
20•

MTFG

10•

0•

Source: Preliminary financial results for fiscal 2001
(comparison of outstanding loans to SMEs after subtracting outstanding consumer loans)

A staff of 500 will work exclusively to attract new customers and expand the customer
base among successful SMEs.

Reinforce Solutions Capabilities and Make Strategic Use of IT
Reinforce Solutions Capabilities
We will further strengthen our head office support framework for branches in concert
with business and industrial research sections. This effort is designed to provide customers with cutting-edge solutions that match their specific business and financial
strategies in areas such as the investment banking business, syndicated loans, derivatives, assistance with IPOs, support for overseas expansion and corporate recovery.

34

Use IT to Provide a Rapid Response to Customers' Requirements
We have inaugurated the Mizuho Business Mall, a service for providing timely
responses in the form of information that matches individual customer requirements
through two-way communications via the Internet.
The service draws on our strengths in IT to provide customers with the desired information directly through a special customizable Web site. The information covers not
only market information such as interest and foreign exchange rates, but also international affairs, personnel and labor issues and other thorough management and business information. Dedicated head office sections and business promotion sections arealso able to respond quickly to inquiries that customers submit via the Internet.

Provide High Value-Added Services by Maximizing theStrengths of MHFG and MHBK
Investment Banking BusinessIn areas such as M&A and MBOs, specialist sections at head office provide support for
branches and, in cooperation with group companies such as MHSC and Mizuho
Corporate Advisory, offer rapid and appropriate responses to customers with businessrestructuring requirements.
In the area of structured finance, including securitization of sales credits, nonrecourse real estate loans and acquisition finance, we have an integrated operational
set-up staffed by specialists who offer various finance schemes and develop products
to satisfy customers' needs in connection with off-balance sheet transactions andfinancial restructuring.
Syndicated Loans
MHFG leads in arranging syndicated loans in the Japanese market with a 44% share(aggregate percentage of the three banks for 2001), and is also the top Japanese bankin the field overseas. We are expanding our personnel resources to strengthen ourbusiness with domestic SMEs as a market leader.
Support for New Businesses and Venture Companies
We are reinforcing our support structure for companies that promise future growth innew businesses such as data communications and multimedia, and new markets suchas the environment, medical treatment and welfare in which they progress originaltechnologies. More specifically, we are strengthening our deployment of specialist staff
who are responsible for such companies. We also respond proactively to the fundingneeds of new businesses and provide financial advice and corporate management support. These initiatives include study groups, seminars, the provision of information to
support management and other services that make use of the group's broad customerbase.
We respond to IPO needs through our IPO support team, which offers listing support
and capital policy advisory services. We also provide further integrated, high valueadded services through multi-faceted collaboration with other companies within MHFG
such as investment in stocks by Mizuho Capital, the leading bank-affiliated venture
capital company and one of the top domestic companies in the field, whose investment balance into venture companies is ¥60.3 billion as of March 31, 2002, MHSC,

35

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Bank

which engages in underwriting and selling stocks, and Mizuho Investors Securities andShinko Securities, both of which sell stocks to individual shareholders.
Transactions with Overseas Subsidiaries of Japanese Corporations
We have established a head office support team that actively specializes in supporting
customers with their global business activities in cooperation with MHCB. We are particularly keen to strengthen our deployment of specialist staff to engage in various
kinds of advisory services in Asia, especially China.
Corporate Recovery
We devise appropriate recovery solutions for companies endeavoring to continue their
Glossarybusinesses through business and financial restructuring. During 2001, we worked withDIP Financing

the Development Bank of Japan in setting up Japan's first DIP financing for a failed

Please refer to page 28.

company that was seeking funds to reorganize itself. We intend to do more along
these lines in the future.

Build an Efficient, High-Quality Operating Structure
We have adopted a strategic, active approach to small businesses. More specifically,
we are developing the Practical Automatic Credit Evaluation System based on a scoringmodel as part of our proactive response to the financing needs of small and mediumsized enterprises. We will further enhance and expand the organization of our Business
Finance Center, which has sophisticated loan officers. The center specializes in direct
marketing via telephone, facsimile, direct mail and other means, centered on loans
guaranteed by the Credit Guarantee Corporation.
In order to strengthen our capabilities in the area of business with small businesses,
we are not only expanding our in-house training and qualification schemes, but also
dispatching personnel to outside companies on a temporary basis. Our aim is todevelop human resources with a high degree of specialization in the corporate banking
market and the ability to formulate proposals for sophisticated solutions.

Public Sector Banking Group
Basic Strategy
Based on the following characteristics and strengths, we will offer timely andappropriate solutions to the increasingly diverse and sophisticated challenges
that customers face as a result of institutional reforms and deregulation.
1) Branch network services covering all of Japan.
2) Offer securities-related services and top-quality financial services using stateof-the-art FT.

Effective Response to the Diversifying Administrative
Needs of Local Governments
The devolution of authority from the national to the local level has increased theimportance of the roles played by local governments and the fiscal measures that they
implement. Efforts now focus on developing and establishing simple, efficient administrative structures capable of dealing with new administrative issues and responding to36

the diverse needs of residents, and on reforms designed to improve the health of local
government finances. Moreover, to ensure that public services are provided efficiently
and effectively, numerous deregulatory measures have been introduced, including thecontracting out of services to the private sector. We will actively provide financial services designed to contribute to efficiency improvements in local government, arranging
PFIs and introducing electronic payment systems for public charges.
We are currently the designated financial institution for 35 local governments, mostof which are based in the Tokyo metropolitan area. We are determined to fulfill the
expectations of these customers by maintaining and enhancing our reliable, high-quality administrative services. Our network comprises a nationwide chain of full-service
branches, more than 5,000 automated outlets including ATMs in convenience stores
and an Internet branch. We use these resources to provide finely tuned financial services to meet the needs of local governments and related organizations throughout
Japan.

Proactive Response to Needs Arising Out of FILP andSpecial Public Corporation Reforms

Glossary
Reform of the FILP
Please refer to page 27.

As progress is made in reforming the FILP, reorganizing national governmental ministries and agencies, and reforming special public corporations, the needs of public sector entities are rapidly diversifying. In addition to devising responses for dealing withthe various new methods now emerging for procuring and investing funds, we closely
follow developments as more public entities are transformed into independent administrative institutions, privatized or closed and consolidated. We stand ready at all times
to offer high-level services that bring together our group research and advisory capabilities, FT and expertise.

Trading and ALM Group
Basic Strategy
1) Offer products and services that respond to increasingly diverse, sophisticated customer needs.
2) Develop an extensive range of new products using our advanced FT andsophisticated systems.
3) Precise, flexible ALM operations for MHBK.

Market Operations: Sales and Trading
Amidst the massive changes taking place in the environment in which companies operate, customers' financial risk control requirements are constantly increasing in sophistication and complexity. Starting with foreign exchange, CP and other financial
products, we are strengthening our range of new products that use state-of-the-art FT,such as weather and commodity derivatives, as well as more conventional interest andexchange rate derivatives. At the same time, we are working to satisfy the precise
needs of our broad customer base by deploying highly specialized area sales teams tocover our nationwide branch network and offer the best possible solutions.

Dealing Room37

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Bank

Banking Operations: ALM
We carefully manage the interest rate risk and liquidity risk associated with our portfolios, which comprise the deposits, loans, securities and other assets and liabilities weUsing Advanced FT

hold. These effective risk controls make flexible use of derivatives and other transactions, and enable us to ensure a stronger, more stable earnings structure.

Securities and Investment Banking Group
Basic Strategy
Offer high value-added solutions for the securities and investment banking business in close cooperation with our various sections, group securities companies
and a venture capital company.

Securities BusinessIn addition to offering solutions that utilize corporate bonds, we employ the underwriting capabilities of MHSC and its overseas securities subsidiaries to provide domestic
SMEs with support through issues of private and public bonds, foreign bonds, equities,
collateralized bond obligations and collateralized loan obligations.
We also draw on our group's comprehensive capabilities to provide integrated, highvalue-added services to growing companies that plan to go public. These capabilities
include advice from MHBK, MHSC and other group companies, investments throughthe group's venture capital company, Mizuho Capital, underwriting and sales of equities by MHSC, and sales of equities to individual shareholders by Mizuho Investors
Securities and Shinko Securities.

Investment Banking BusinessIn the investment banking business, professional staff specializing in SMEs make use ofadvanced financial technologies such as M&A and structured finance including various
forms of securitization and liquidation, and MBO financing to provide suitable
responses to customers' increasingly sophisticated and complex requirements in thearea of business and financial strategies. In doing so, we also work closely with MHSC
and other group companies.

Responding to Asset Management Needs
To meet customers' wide-ranging asset management needs in areas such as equities,
bonds and foreign bonds, we offer high-quality products and services in close and flexible cooperation with MHSC, with its powerful underwriting and product arrangement
capabilities, and Mizuho Investors Securities and Shinko Securities, with their extensive
branch networks. We also offer "one-stop" banking and securities services throughbranches operated jointly with Mizuho Investors Securities.

38

Trust and Asset Management Group
Basic Strategy
1) Provide consulting services to enable customers to construct the best asset
mix of their portfolio; offer attractive investment products such as investment
trusts, with reliable quality control.
2) Meet customers' longer-term requirements through products and services
ranging from feasibility studies on defined contribution pension plans to theirintroduction and administration.

Screen Shot of MHBK's M-PAS Portfolio
Proposal System

3) Offer more far-reaching solutions to customers' investment trust requirements following the start of our operations as a franchise in trust services.

Investment Trusts
The extensive Mizuho Fund Collection is designed to respond to customers' increasing
diverse and sophisticated asset management needs. To help customers with their longterm asset formation plans, we also provide advice on asset allocation according totheir investment targets and risk tolerance, and a carefully devised after-care program
concerning investment performance and the profit and loss situation.

Defined Contribution Pensions
We provide extensive support in connection with pension asset formation. For corporate customers looking at the introduction of defined contribution plans, this extends
from feasibility studies and scheme design through to actual administration following
introduction. For individual customers, we started offering the Mizuho Personal
Pension Plan in April 2002. Since our affiliated asset management companies also offer
a wide range of investment products, we are channeling our total resources and capabilities into becoming a front runner in the Japanese defined contribution pension market.

Trust Services
We started our operations as a franchise in trust services for MHTB in April 2002. Using
the stronger group marketing capabilities that have resulted from the fusion of
MHBK's business promotion functions and MHTB's highly-specialized trust functions,
we are working to deliver more in-depth solutions to satisfy customers' increasingly

Glossary
Franchise System in Trust Services
Business in which a financial institution, whichbecomes a franchise in response to consignment ofa trust bank, introduces a customer to the trustbank after giving the customer an explanation of its
products.

diverse and sophisticated requirements in the area of trust business.

39

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Bank

Glossarye-Business Services Group

Ubiquitous Networks"Ubiquitous" is derived from the Latin for"omnipresence" or "to be everywhere." Today, it isused in digital networking circles in reference to the
new infrastructure created by the linkage between
mobile phones, car navigation systems, TV game
consoles and other portable information devices,
optical fiber and ADSL.

Basic Strategy
1) Expand business based on new technologies such as account applications,broadband, Voice Over Internet Protocol (VOIP) and ubiquitous networks.
2) Provide low cost and high-quality services more promptly, including the possibility of strategic alliances.

VOIP (Voice Over Internet Protocol)
Originally, voice and data transmissions were carried over separate telecommunications circuits.
VOIP is an advanced technology that allows them
to be sent together using protocol-compliant
equipment attached to the Internet.

B2C (Business to Consumer) BusinessWe are working towards the expansion of services that bring about more convenience
to our customers. These services are for example, debit cards, which can be used invarious settlement situations, and Internet banking, the number of users of which has
dramatically increased in the last few years, and we expect further growth.
As for IC cards, we continue our challenge to develop their multi-functionality andmake the provision of new services possible.

B2B (Business to Business) Business
Based on the advantage of having the largest customer base among all Japanese bankswith regard to the domestic firm banking business, we do our utmost to develop andimprove the line-up of our products to meet the needs of our customers.
More specifically, this means responding to various needs for both domestic andglobal cash management services and Web banking services for companies throughthe use of Internet technologies. We are also upgrading products that customers canuse in all aspects of settlement, such as invoicing, payments and reconciliation of
accounts receivable.

Trade Services Group
Basic Strategy
1) Promote improvement and efficiency of foreign exchange-related services,
expand trade finance business.
2) Provide foreign currency deposit-related products and services that respondto customers' increasingly diverse investment needs.
3) Contribute to better convenience for customers by building a network of correspondent banks and strengthening our response to trade finance EDI.

Foreign Exchange
We worked to improve the quality of our various services in the area of foreignexchange transactions, and helped customers adjust smoothly to the switchover to theeuro when the single currency was introduced in January 2002. We also started handling currency exchange transactions involving the Korean won in April 2002.

40

Foreign Currency Deposits
In addition to conventional foreign currency time deposits, we have extended our
product range by offering special foreign currency time deposit contracts for hedging
against exchange risk within certain parameters. We have also started a foreign currency transfer service that allows two-way transfers between yen deposits and foreignsavings deposits through ATMs using a single cash card. Our euro-denominated foreign currency deposits have been well-received by customers.

Trade FinanceAs the need for hedging against export risk increases, we are adding new schemes
such as silent confirmation and forfaiting to the confirmation of L/C transactions. For

Glossary

non-L/C transactions, we have moved to meet an even wider ranger of needs by pro-Silent Confirmation

viding invoice discount in a tie-up with our group factoring company, Mizuho Factors.

Trade Finance EDI
To improve the efficiency of trade operations through the use of electronic documentation, we participate enthusiastically in global projects such as Bolero as a means ofstrengthening our cross-border settlement capabilities.

Refers to the practice of confirming the L/C inquestion (confirmation) without notifying the bankissuing the L/C (silent), at the request of theexporter in export L/C transactions.

Forfaiting
Refers to purchases on the condition of acceptanceof time bills without the right of recourse for
repurchase by the exporter in export L/C transactions.

Invoice DiscountRefers to a scheme whereby Mizuho Bank provides
finance while group factoring company Mizuho
Factors provides a final collection guarantee fordeferred remittance export transactions.

41

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Securities

Basic Strategy
MHSC aims to become the most powerful investment bank in Japan, providing thebest possible solutions for the wide-ranging needs of its customers centered on
domestic and overseas institutional investors, corporations, financial institutions andpublic institutions, in the areas of securities and investment banking. Our core businesses are debt, equities, M&A and structured finance and we compete with the bighouses of Europe and the U.S. as a professional house that draws on advanced financial technologies to offer high value-added products and services at the global level.

Bond Trading
As a leader in the bond market, our operations are distinguished by the fact that wefollow the basic principle of creating a bond house that is trusted by our customers.
This governs our efforts to supply institutional investors in markets at home and overseas with products that suit their investment strategies, our proactive market making,and the high-quality information we offer.
We constantly achieve high rankings in Japanese government bond bids and as amember of the Meeting on the Japanese Government Bond Market, we are not only
proactively involved in the market, but also account for around 10% of customer
trades (fiscal 2001), which gives us a powerful presence in the secondary bond market.
In the structured finance business, we have deployed a specialist business promotion
team to link customers with our product development divisions. By ensuring that customers' requirements are properly reflected in the product development process, thisteam is responsible to a very great extent for our overwhelming strength in this business. In the structured bonds business, where cutting-edge FT plays a major role, we
cooperate with Mizuho International, our securities subsidiary in London, in providing astable supply of products that satisfy customers' demands.
In the area of research, we support customers with macroeconomic, credit and othermarket analyses and offer portfolio diagnostic services in response to customers' individual needs. As a result, our researchers have earned an excellent reputation, and our
research team ranked at the top for fiscal 2001 in Nikkei Bond Information by the leading Japanese financial daily, Nihon Keizai Shimbun.

Equities Trading
We provide a full line-up of equities products for a wide range of customers, fromdomestic and overseas institutional investors to business corporations and financial
institutions. To build on the excellent reputation that our macroeconomic analysis division has enjoyed for some time, we sought to strengthen our research capabilities in
the area of individual corporate analyses by reinforcing our team of sector analysts.
Not content to confine our focus on domestic business promotion, we also achieved
steady expansion in transactions with institutional investors overseas, cooperating withthe sales teams of our securities subsidiaries in London, New York, Zurich and Hong
Kong to create a framework that will allow rapid and accurate dissemination ofresearch reports. Looking ahead, we will strive harder to develop our global businessthrough overseas placements and investor relations briefings for institutional investors.

42

In the area of equity derivatives, we have assembled a highly experienced staff who
work on devising suitable proposals for dealing with customers' investment, funding
and financial strategy requirements within sophisticated risk management frameworks.
With a sales force capable of covering markets at home and abroad, research capabilities backed by well-staffed analyst divisions, trading and execution systems supported by state-of-the-art front office trading systems, and product development
strengths using derivatives and other vehicles, we are well-placed to fulfill our customers' high-level needs.

M&A
Based on our ability to identify customers' strengths and management issues, and distinguish core businesses from non-core businesses, we offer customers advice onenhancing enterprise value by supporting efforts to grow and expand core businesseson the one hand, and to sell and spin off non-core businesses into other companies on
the other. More specifically, we are engaged in providing advice pertaining to the capital structure and optimal business portfolio realignments necessary for realizing business strategies. We also offer comprehensive advice for customers during the M&A
process, including equity trading, transfers of business, mergers, stock-for-stock
exchanges, corporate splits and company spin-offs. This advice covers business valuations, evaluations of acquisition pricing and merger and consolidation ratios, as well as
negotiations over sales and consolidations.
We are also able to offer our services globally in cooperation with our overseas
offices, engaging in cross-border services with foreign affiliated companies and providing financial advice to the overseas subsidiaries of Japanese customers. Proof of our
top-class performance is provided by the fact that we were ranked first in Thomson
Financial's M&A Advisory Banking Transactions Involving Purchase of JapaneseCompanies (announcement basis for 2001) in terms of number of transactions, andsecond in terms of transaction value.
We remain committed to establishing a firm position as a leading company in thisarea through our efforts to respond promptly and accurately to customers' diverse
needs.

Structured Finance
We have continued to play a leading role in the Japanese structured finance market bybuilding on our advanced know-how and solid past record in securitizing real estateand monetary claims (lease receivables, housing loan claims, etc.) and lease finance. In
2001, we received the Thomson Deal Watch "ABS House of the Year" award for thesecond consecutive year. In fiscal 2001, we were also the top lead manager in domestic ABS public offerings (value basis) for the third year in succession.
We will continue our proactive approach to handling the securitization of all types ofassets, including REIT-related business, while responding to customers' needs throughthe development of various kinds of financial technologies.

43

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Securities

Main Structured Finance Businesses Handled by Mizuho Securities• Securitization (moving various financial assets such as leases, credit and otherreceivables off the balance sheet)• Real estate finance (real estate securitization, non-recourse loan arrangement)
Glossary• J-REIT (Japanese-style REIT)

J-REIT (Japanese Real Estate Investment
Trusts)• Develop equity-related products (new types of equity-related products)

Newly introduced Investment Trusts which engage
in real estate. They can be listed on exchanges suchas the Tokyo Stock Exchange (TSE) and may also be
granted special corporate tax considerations if theysatisfy certain requirements. J-REITs were modeled
after the Real Estate Investment Trusts set up in the
U.S. and elsewhere, and the first was listed on the
TSE in September 2001. We have high expectations
that they will help to reinvigorate the real estatemarket.

• Develop tailor-made products (financial products to satisfy customers' individual needs)• Other products

Debt Financing
We have compiled one of the business sectors' best records in the area of debt financing. Contributory factors include our powerful capabilities in selling bonds, setting
prices to reflect customer demand with precision, and responding rapidly to changes in
the market.
According to materials based on I-N Information Systems statistics concerning underwriting performance related to Japanese customers' issues, we maintained our prominent presence in the market in fiscal 2001. We topped the league table for
Underwriting FILP Agency Bonds, took second place for Underwriting Bonds Issued byElectric Power Utilities in the Wholesale Market, and third place in General Industrial
Bonds for the Wholesale Market. In cooperation with our overseas securities subsidiaries, we also respond to our customers' needs for debt financing in overseas markets.
We have earned high marks for our underwriting regarding non-Japanese customers’ issues. In fact, two of the Samurai bond issues that we lead-managed received
awards, one winning the international finance magazine Euro Week's "2001 Yen Dealof the Year," and the other the Nihon Keizai Shimbun's "Best Samurai Bond Deal of
2001."In addition to proposals for finance, we are active in drawing up proposals for dealing with the recent increase in credit risk, matters relating to raising credit ratings andimproving disclosure, and other issues associated with debt financing. We will continue
to use accurate analyses of market trends and cutting-edge financial technologies informulating proposals for optimized funding plans according to customers' needs.

Equity Financing
With the application of sophisticated FT and our excellent equity placing power inJapan and overseas, we are able to satisfy customers' needs for equity financing
through capital increase by public offerings, sales, and convertible bond issues. Our
underwriting record in recent years has been acknowledged in league tables of I-N
Information Systems. We were ranked fourth in the Domestic Convertible Bond
Underwriters' League Table for fiscal 2001, first in the Japanese CB in the Swiss Market
Lead Managers' League Table for 2001; and first in the Japanese CB in the Swiss
Market Underwriters' League Table for 2001. As these results show, we have a great
deal of experience not only in the domestic market but also in the euro market, theSwiss market and other markets overseas.

44

We have been quick to respond to changes in Japanese legislation and taxation systems and pay constant attention to the task of drawing up proposals pertaining tocapital policies that will maximize customer enterprise value, including proposals on
schemes that make use of newly-introduced stock subscription rights and treasury
stocks.
In October 2001, we established Japan Investor Relations and Investor Support (J-Glossary
Stock Subscription Rights
The right to acquire stocks at a price of specification.

Treasury Stocks
Stocks that are purchased by the issuing company
and are held for future use.

IRIS) to engage in research on investor relations for corporations and investor support
for institutional investors. The shareholding structures that traditionally existed inJapan's equity markets are currently undergoing major changes as financial institutions
continue to unwind their cross-shareholdings and foreign shareholders and other institutional investors increase their influence. To respond to the changing times, J-IRIS provides proactive suggestions and advice based on research into corporate governance incooperation with the Investor Responsibility Research Center (IRRC), a U.S. research
institution.

IPOs
The number of Japanese companies wishing to go public through IPOs on the TSE,
OSE, JASDAQ, TSE Mothers and NASDAQ Japan remains as high as ever. We havesought to satisfy their wishes by putting considerable effort into the IPO-related business. As a result, we have acted as lead manager for a total of 11 IPOs, and our strong
performance and reputation for customer satisfaction were acknowledged when we
ranked fifth in the New Stock Issues Underwriters' League Table for fiscal 2001 basedon I-N Information Systems statistics.
One of the features of the IPO services we provide is our ability to offer appropriate
solutions to our customers' varied needs through our team of professionals, who arevastly experienced in advising on public offerings. In addition to providing advice on
the most appropriate capital policies, creating in-house management structures andother aspects of preparing for IPOs, we have established frameworks for providing customers that are about to make their market debuts with comprehensive support inareas such as disclosure, preparing due diligence materials, building in-house structuresin preparation for the IPO, and training human resources.
Once the offering has been completed, we also stand ready to respond quickly tocustomers' needs through teams specializing in post-IPO investor relations, growthstrategies and capital policies.

45

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Trust & Banking

Basic Strategy
MHTB specializes in providing trust banking services to corporate customers. We havea strong financial structure with a minimum of risk exposure in our banking operations
and offer professional expertise in four areas: pension trust and asset management,
custodial services, stock transfer agency business and securitization services. We haveconcentrated our management resources on these asset management businesses tocreate advanced systems and risk management structures. We aim to become our customers' "best partner for trust services" by offering them the best and most appropriate services for their needs.
Glossary
Franchise System in Trust Services
Please refer to page 39.

Introduction of Franchise System in Trust Services
Following the revision of legislation on banks’ participation in the trust business, we
received approval from the Financial Services Agency to make MHCB and MHBK ourfranchises from April 2002. It therefore became possible to enhance our services further by providing customers products in the four areas mentioned above through
MHCB and MHBK.

Pension Trust and Asset Management Services
Pension Business
Following the enforcement of the Defined Contribution Pension Law in October 2001
and the Defined Benefit Corporate Pension Law in April 2002, companies are now able
to select from a wider range of pension schemes than ever before. The Tax Qualified
Pension System has long been a mainstay of corporate pension plans in Japan, but is tobe abolished on March 31, 2012. It will become possible for companies to return to
the government the substituted portion of Employees' Pension Insurance within
Employees' Pension Funds. Two new corporate pensions will also be set up: the agreement-based-type and the legal-based-type pension. Amidst these environmental
changes, companies are reaching the stage where they will have to start drastic
reviews of their own corporate pension schemes and look into the possibility of switching to new ones. Our response to these changes is to work even harder to satisfy customers' needs by enhancing our capabilities as a full range service provider.
Provide Know-How as a Full Range Service Provider
Since the entrustment of the first Tax Qualified Retirement Pension Plan in 1962, andthe inauguration of the Employees' Pension Fund System in 1966, we have endeavored
to promote and expand the corporate pension system. We boast one of the bestrecords in the area of the Employees' Pension Fund—the main corporate pension
scheme. As of March 31, 2002, we had 789 funds in trust, including 222 funds forwhich we act as a sole or main trustee. In everything from actuarial and administrative
services, asset management and custody to pension consulting, we have earned thetrust of the sponsors of Employee's Pension Fund and Tax Qualified Pension Plan aswell as participants and beneficiaries of pension benefits. Moreover, we were ranked
as the number one asset manager in the "Fiscal 2001 Pension Customer Ratings ofAsset Managers" (Rating and Investment Information ("R&I"): Pension Information).

46

Asset Management BusinessWe are endeavoring to satisfy customers' requirements by offering various types ofhigh-quality fund management products for corporate pension funds and public institutions. We also respond to their diversifying needs by providing various solutions,
including proposals and information centered on asset management.
Providing Products
We offer a line-up of products that satisfy customers’ varying needs. They range from
active investments that aim to surpass the performance of benchmarks such as the TSE
Stock Price Index to passive investments that aim for precise linkage with movements
in market indices. In our active investments, our policy for both stocks and bonds indomestic and overseas markets is to concentrate on individual stock selections based

Establishment of the Pension
Business Department (network
business promotion)
In November 2001, we established thePension Business Department (network
business promotion), as a part of the establishment of a new business model designed
to allow the rapid delivery of high-quality
services tailored to the IT era.
Specialist staff with abundant experience inthe pension business are assigned for eachcustomer. Using Web sites, e-mail and othertools, they offer quick responses to inquiries
and requests for advice, disclose information
relating to investments and distribute pensionrelated materials over the Internet, thus providing the latest information in real time.

on fundamental research, and our specialist teams of analysts have earned an excellent
reputation among our customers. In our passive investments, we have established our
position as one of the pioneers among domestic investment institutions.
Developing the Solutions BusinessOn the solutions side, we offer corporate pension customers integrated proposals thatcover everything from plan designing to investment planning. We also offer investment
products in new areas that take into account the reforms of the pension system,
including defined contribution pension plans, cash balance plans, and the return to thegovernment of the substituted portion of Employees' Pension Insurance within
Employees' Pension Funds. We are thus well-equipped to offer appropriate proposals
and advice concerning the issues customers face.
The basic spirit behind these investment operations is to fulfill our responsibilities asa trustee, and we are steadily winning greater trust among customers through ourefforts to establish a framework that ensures compliance with our fiduciary duties in all
aspects of our business.

Custodial Services
We are engaged in complex, high-volume custodial services such as specified money
trusts (tokkin funds), pecuniary trusts other than money trusts, securities investment
trusts and securities trusts. Custodial services are one of our most important core busi-

Glossary
Securities Settlement System Reform
Please refer to page 29.

nesses, and customers value our services because they are manifestly based on a highdegree of expertise.
The planned introduction of shorter settlement cycles and other major reforms currently affecting securities settlement systems will have a considerable impact on custodial operations. In particular, massive investments in systems are needed to comply
with the automation of procedures ranging from securities contracts through to settlements and accounting, which is known as Straight Through Processing (STP).
To respond to these developments, we established the Trust & Custody Services

Dealings in ETFs
In the area of investment trusts, we werequick to respond to the introduction of ETFs
in fiscal 2001, developing original schemesthat are designed to ensure greater
convenience and protection for investors, andmaking them available to customers inAugust 2001.

Bank together with four life insurance companies with which we have close ties—

Glossary

Asahi Mutual Life Insurance, Dai-ichi Mutual Life Insurance, Fukoku Mutual Life

These investment trusts are traded on stock
exchanges after the underlying funds havebeen listed. The decision to introduce them
was taken as part of the emergency economic
package adopted in April 2001. Products
linked to stock indexes such as the TOPIX and
the Nikkei 225 are sold.

Insurance, and Yasuda Mutual Life Insurance—and entrusted it with custodial operations. By integrating the assets of the companies together with their know-how andtaking full advantage of scale profit, we are able to offer high-level services.

ETFs

47

Management and Business Strategy of Mizuho

Management and Business Strategy of Mizuho Trust & Banking

Consolidation of Assets at
Trust & Custody Services Bank

We intend to continue working together with the Trust & Custody Services Bank toincrease our specialist expertise and establish an even stronger presence as a custodial

In December 2001, we consigned the operation of entrusted assets from our customers
by using the re-entrust scheme to the Trust &Custody Services Bank.

institution.

Glossary

Drastic changes are affecting the environment surrounding the stock transfer agency

Re-Entrust Scheme
A scheme by which a trustee entity may conclude a trust agreement with another trustbank to enable the latter to undertake part ofits trust operations. The idea of re-entrustment schemes was proposed as a means ofintegrating custodial operations during studies on setting up Japanese-style master trusts,
and issues pertaining to taxes and legislation
have been sorted out and resolved.

Stock Transfer Agency Services
business. Following the amendments to the Commercial Code in fiscal 2001, proposals
for further amendments in fiscal 2002 are expected to lead to discussions on stock system reforms, including the stock invalidation scheme, the establishment of paperlessstock issues, and the disposal of stocks belonging to shareholders whose whereabouts
are unknown.
During fiscal 2001 we worked hard to expand our business, achieving top performance in the business sector in increasing the number of companies entrusting theirbusiness to us. As of the end of March 2002, the number of companies entrusting uswith stock transfer agency business had reached 834, and the number of shareholders
covered was 4.53 million. From fiscal 2002, we shall conduct business promotion activities using an extensive sales network in which MHCB and MHBK serve as our franchises in trust services.

Glossary
Commercial Code Revisions Expected in
Fiscal 2001
 Revisions affecting securities• Stock invalidation scheme to render stock
certificates invalid after the passage of one
year from the date on which a person losing
the certificates in question registers their loss
with the company concerned.
• System for using auctions to dispose of stocks
belonging to shareholders whose whereabouts
have been unknown for five years or more.

We have thus made considerable efforts to built up powerful consulting capabilities
as a result of a series of Commercial Code amendments covering corporate reorganization, the "tangen-kabu" unit share system (abolishing net asset per share regulations,ending the "tan'i-kabu" unit share system and abolishing the par-value stock system)
and corporate governance. Against this background, we have responded by quickly
entering new sectors, such as commencing services to persuade individual shareholders
in Japan to exercise their voting rights. We have also completed our systems in
response to using IT at the general meeting of shareholders, and have earned highpraise for the establishment of a system that allows us to respond proactively in this Revisions affecting corporate
organization• Special exceptions measures that allow
committees on board nominations, audits,
directors' remuneration, etc., to be installed
instead of corporate auditors.
• Easing of quorum requirements for special
resolutions of the general meeting ofshareholders to allow the quorum to be
reduced from a majority of shareholders to
at least one-third.

Use of IT at General Meetingsof Shareholders
We are working on the development of a
"General Meeting IT System" designed toallow general meetings of shareholders
to be held at low cost while maintaining
high security levels. Shareholders will beable to exercise their votes electronicallyat the June 2002 General Meeting of
Shareholders and we shall start making“e-notifications” and “e-claims” available
from the March 2003 general meeting.

way to the needs of companies who have entrusted us with their business.
As part of our other services to shareholders, we have set up one of the best reception networks in the industry, establishing agency desks at 59 offices of Mizuho
Investors Securities since November 2001. We also continue to increase the number ofshareholder call centers and to improve our Web site. We will constantly review ourservices for shareholders as we maintain our efforts to respond proactively to our customers' demands.

Securitization Services
Securitization services enable us to support customers in arranging their claims into
beneficial interest in trust, ABSs and CPs through trusts or special purpose companies
for sale to investors. In addition to providing new funding methods based on the creditworthiness of customers' claims, this contributes to more efficient use of capital bymoving assets off the balance sheet.
Securitization is one of today's cutting-edge services, and the leading position we
have achieved in terms of performance in this area owes much to the high-level structuring know-how we have accumulated in developing and proposing stable and efficient securitization schemes. In addition to providing reliable yet low-cost services
through our dedicated systems, we develop optimized products on a tailor-made basis.

48

Total Solutions Services
We securitize various kinds of assets and provide high value-added products. In particular, our "Noteless 2" product was the first successful attempt in Japan to create alump-sum accounts payable trust product. This epoch-making product simultaneously
satisfies corporate needs by eliminating promissory notes and rationalizing operations
and administration procedures while assisting suppliers with their funding requirements, and has been extremely well-received. As of March 31, 2002, 71 companies
had introduced the scheme and some 26,000 entrustment registration contracts had
been concluded.

Enhancing Promissory Note
Securitization Capabilities
Having developed a scheme for the lumpsum securitization of the massive volumesof promissory notes held by corporations,
we have recently increased the processing
capacity and performance of our originalpromissory note management scheme inresponse to the huge securitization needsof companies holding such notes in large
quantities. As a result of these efforts, thebalance of promissory note claim trusts
entrusted to us had reached ¥205.9
billion as of March 31, 2002.

Sophisticated Structuring Capabilities
As the trust bank with the leading share of securitization services entrusted, we makemaximum use of our trust capabilities to develop and propose efficient and stablesecuritization schemes. Drawing on the high-level structuring capabilities we havebuilt to date, we provide optimized solutions to customer requirements for reductionsin assets and liabilities, improvements in financial ratios, and diversification of funding
methods.
High-Quality Asset Administration Services
Investors who have purchased beneficial interests and ABSs can use our asset management system with confidence. Not only is it supported by our vast experience as atrustee and the variety of know-how we have acquired in managing trust claim recovery data, but it also offers flexible systems responses to individual schemes.

Overseas Activities
Overseas Subsidiaries
The number of Japanese investors wishing to invest in foreign securities is increasing.
To respond quickly to their growing demands, we have concentrated our administration services for overseas funds (investment trusts registered in foreign countries) andoverseas custody services (including settlement of foreign securities and safekeeping) in
Mizuho Trust & Banking (USA), a wholly owned subsidiary in New York and Mizuho
Trust & Banking (Luxembourg), another wholly owned subsidiary based in Europe. As aresult, we are now able to provide carefully tailored global-standard services throughour tripolar support system, which covers Japan and the rest of Asia from Tokyo, theAmericas and Europe.

"Noteless 2" Lump-sum
Accounts Payable Trusts
As companies come under rising pressure
to rationalize, more of them are moving
to eliminate payment by promissory note.
The "Noteless 2" lump-sum accounts
payable trust scheme is a new settlement
method that we have developed toreplace the traditional method ofsettlements using promissory notes. It is
designed for use by suppliers andcompanies that are due to makepayments to them.
Instead of issuing a promissory note,monthly receivables are placed in trust
for the supplier each time they are
confirmed and the data is sent to us.
Since the supplier is able to transfer trust
beneficial interests to a third party using
us as intermediary, it can obtain cash
before the due date. At the same time,
the company making payment is able touse its creditworthiness to obtain lowinterest funding.
• Advantages for the company making
the payment(1) Rationalize operations and administrative business involved in issuing promissory notes and save stamp duty.
(2) Outsource settlement operations.
(3) Deal effectively with duplicate payment
risk in the case of the supplier's bankruptcy.

• Advantages for the supplier(1) Diversify low-interest funding sources
and methods using the payer's credit
standing.
(2) Rationalize operations and administration business and prevent problems suchas loss of promissory notes.

We have also posted asset management staff at Mizuho Trust & Banking (USA), andthey are working actively through a desk we have set up at Bernstein, a world-classinvestment research and management company with which we have close ties. Basedon Bernstein's research data, we use corporate visits and other methods for our own"Noteless 2" (product name)Lump-sum Accounts Payable
Trust scheme
Supplier

at Bernstein in London, where they are active in research.

Payer


Payment on
due date

MHTB Co., Ltd.

 Payment of accounts receivable

Europe. As in the case of Mizuho Trust & Banking (USA), we have also posted staffers
Trustagreement (Payment for
beneficiary interests)

Our London Representative Office is our base for asset management activities in

Receivables placedin trust

London Representative Office

Delivery and invoice forpayment (receivables
generated)with our Corporate Research Office in Tokyo.

 (Transfer of beneficiaryinterests)
 Purchase of beneficiaryinterests

additional research and build model portfolios consisting of U.S. stocks in consultation

Investors

Payer: Company making payment

49

Management and Business Strategy of Mizuho

Business Results Highlights of Mizuho
MHFG is highly ranked in a wide range of financial services in Japan.

Supporting Global Business with Global Networkof 75 Offices Covering Major Overseas Markets

Supporting the Financial Needs of Households

 4,500 non-Japanese customers as of March 31, 2002

 ¥35 trillion in personal assets under management (No. 1 among Japanese banks) ¥12.5 trillion in consumer loan portfolio (No. 2 among Japanese banks) ¥9 trillion in residential housing loan portfolio (No. 1 among Japanese banks)
 6.4 million customers utilizing membership-style banking services (No. 1 among Japanese banks) ¥9 trillion in loans at overseas branches as of March 31, 2002
 US$67.2 billion (488 transactions) in arrangement of global
syndicated loans (No. 1 among Japanese banks) for 2001
 US$3.2 billion in arrangement of global project finance (No.1
among Japanese banks) for 2001

*All figures are as of March 31, 2002

Global Syndicated Loan Arrangers(Amounts arranged; aggregated figures of the three banks;
January 1~December 31, 2001)

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

 45% share in yen custody services for foreign institutional
investors (No. 1 among Japanese banks) as of March 31, 2002
 32% share in foreign exchange (yen clearing) services (No. 1
among Japanese banks) as of March 31, 2002

 8,909 testamentary trusts entrusted (No. 1 in industry sector) as of March 31, 2002
 ¥110 billion in total debit card sales by affiliated merchants (No.1 among Japanese banks) for fiscal 2001
 910 thousand subscribers of Internet banking services as of March 31, 2002
 2.8 million telephone banking service users as of March 31, 2002
 MHBK’s 664 full-service branches; 5,000 automated outlets (locations of ATM including joint-use ATMs
at convenience stores) in Japan (one of the largest branch networks in Japan) as of April 1, 2002

Amount(US$million)

Ranking

JP Morgan
252,196.0
Citigroup/Salomon Smith Barney
222,360.6
Bank of America
215,275.4
Deutsche Bank
86,059.9
Mizuho Financial Group
67,171.8
BankOne66,140.2
Barclays Capital
63,562.2
ABN AMRO
49,810.1
BNP Paribas
46,618.7
FleetBoston
46,142.8
Wachovia Bank
44,304.4
Bank of Tokyo-Mitsubishi
44,204.8
CSFB(Credit Suisse First Boston)
39,921.4
Bank of Nova Scotia
38,074.8
Commerzbank
37,303.9
RBS(Royal Bank of Scotland)
34,850.0
HSBC(Hongkong Shanghai Banking Corp.) 33,663.9
SMBC
27,639.8
Bank of New York25,797.5
Westdeutsche Landesbank
25,233.9

Source: IFR, January 5, 2002

Global Project Finance Arrangers(Amounts arranged; aggregated figures of the three banks;
January 1~December 31, 2001)
Amount No.of
Ranking(US$million) Deals

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Supporting the Financial Needs of Corporations ¥34 trillion in loans to SMEs (No. 1 among Japanese banks) as of March 31, 2002
 ¥24.5 trillion in loans to large corporations (No. 1 among Japanese banks) as of March 31, 2002
 US$40.7 billion (44% share) in arrangement of domestic syndicated loans (No. 1 among Japanesebanks) for 2001
 ¥3.2 trillion in administration of public bond offerings (No. 1 among Japanese banks) for fiscal 2001

 82 arrangements (No. 1 in industry sector) and US$28.3
billion (No. 2 in industry sector) in M&A advisory banking
transactions involving purchase of Japanese companies(announcement basis for 2001)
 ¥60.3 billion invested by venture capital (No. 1 among ¥534 trillion in interest rate swaps and ¥21 trillion in exchange rate swaps (No. 1 among Japanesebanks) as of March 31, 2002
 ¥854.8 billion in lead management of domestic straight bond issues excluding city bank issues, selffinancing issues, and retail investors targeted issues (No. 3 among industry sector) for fiscal 2001
 ¥174.5 billion in lead management of FILP agency bond issues (No. 1 in industry sector) for fiscal 2001

bank affiliated venture capital) as of March 31, 2002
 ¥8.5 trillion in assets under management (No. 3 inindustry sector) as of December 31, 2001
 ¥5.1 trillion in domestic pension funds undermanagement (No. 2 in industry sector) as of December ¥200.2 billion in lead management of domestic ABS issues (No. 1 in industry sector) for fiscal 2001
 ¥197.5 billion in domestic real estate securitization (No. 1 in industry sector) for fiscal 2001

31, 2001
 ¥2.8 trillion in asset securitization (No. 1 in industry
sector) as of March 31, 2002

Loans to Domestic SMEs

Loans to Large Corporations(Aggregated figures of the three banks; as of March 31, 2002)(Aggregated figures of the three banks; as of March 31, 2002) ¥1.6 trillion in retirement benefit funds entrusted (No. 1
in industry sector) as of March 31, 2002(¥ trillions)40•(¥ trillions)
MHFG

40•

Sumitomo Mitsui
Banking Corp (SMBC)
Mitsubishi Tokyo
Financial Group(MTFG)20•

MHFG(US$ billion)
50•

MTFG

40•

SMBC
UFJ

40.7

UFJ Group (UFJ)

24.5

20•

34

30•

30•

Domestic Syndicated Loans
Arranged for 2001

10•

0•

0•

Source: Preliminary financial results for fiscal 2001 (comparison of outstanding loans to SMEs after subtracting
outstanding consumer loans)

Source: Preliminary financial results for fiscal 2001.
Researched by MHHD

MTFG
SMBC

30•

Domestic ABS League Table
Lead Management Issues
Total issues: ¥549.5 billion

10•0•Source: IFR Securities Data

Ranking

1
2
3
4
5
6
7
8
8
8

Securities company

Mizuho Securities
Daiwa Securities SMBC
UFJ Capital Markets Securities
Nomura Securities
Deutsche Securities
Goldman Sachs
Nikko Salomon Smith Barney
Credit Suisse First Boston
Merrill Lynch
Morgan Stanley Dean Witter

Source: Mizuho Securities research

54
27
21
17
8
18
17
19
14
18
20
5
13
12
16
2
11
12
10
10

Source: PFI, January 23, 2002

Domestic SB League Table(Fiscal 2001)

Citigroup Inc.
20•

10•

MHFG

Citigroup
15,512
Westdeutsche Landesbank
8,235
BNP Paribas
6,429
Societe Generale
5,301
CSFB(Credit Suisse First Boston)
4,742
JP Morgan
4,333
Dresdner Kleinwort Wasserstein
4,038
ABN AMRO
4,019
Deutsche Bank
3,623
Barclays Bank
3,612
Mizuho Financial Group
3,187
IntesaBci
2,621
Bank of America
2,282
Credit Lyonnais
2,019Royal Bank of Scotland
1,911
Skandinaviska Enskilda Banken
1,582Bank of Tokyo-Mitsubishi
1,573
Australia and New Zealand Banking Group 1,532
Santander Central Hispano
1,465
Credit Agricole Indosuez
1,366(Fiscal 2001)

Lead Management Issues (excluding city bank issues,
self-financing issues and retail investors targeted issues)
Total issues: ¥5,474.5 billion

Leadmanagement
issues(billion yen)

Market
share
(%)

200.2
101.1
71.1
56.3
48.9
38.8
14.6
6.3
6.3
6.3

36.42
18.39
11.79
10.24
8.90
7.05
2.66
1.14
1.14
1.14

Ranking

1
2
3
4
5
6
7
8
9
10

Securities company

Leadmanagement
issues(billion yen)

Marketshare(%)

Nomura Securities
Daiwa Securities SMBC
Mizuho Securities
Nikko Salomon Smith BarneyTokyo-Mitsubishi Securities
Goldman Sachs
Morgan Stanley Dean Witter
UFJ Capital Markets Securities
Shinko Securities
Merrill Lynch Japan Securities

1,182.8
1,004.5
854.8
764.8
442.8
335.0
195.0
168.2
126.8
100.0

21.61
18.35
15.61
13.97
8.09
6.12
3.56
3.07
2.32
1.83

Source: Mizuho Securities research* All figures are aggregates of the three banks and rounded off.
50

51

Community Activities of Mizuho
We are conscious of the importance of the responsibility to contribute to society as a "good corporate citizen" and will
actively engage in various local community activities including donations at home and overseas.
We will also support the volunteer activities of our executives and employees.

US$1 Million Contribution to Rescue Operations Following
Terrorist Attacks on U.S.
We contributed US$1 million to the Japan Red Cross Society to support rescue operations following the September 11, 2001 terrorist attacks on New York and Washington, D.C.
Tragically, the victims of these dreadful attacks included 19 group employees working at our
Donation to the Japan Red Cross
Society

offices in the World Trade Center.

Traffic Safety Campaign
Each year, as part of our “Yellow Badge Traffic Safety Campaign,” first-graders throughout
Japan are provided with yellow badges that, when worn, signify they are automatically coveredby traffic accident insurance if they are involved in an accident on their way to or from school.
First-year primary school students
wearing yellow badges during theTraffic Safety Campaign

Fiscal 2000 marked the 38th year of this traffic safety campaign, which started in 1965 and has
now provided insurance coverage for a total of 47.06 million children.

Contributions to Local Communities in Japan
Support for the Economic Viability of Vocational Aid Centers for the Mentally and Physically Challenged
Mizuho Bank's (MHBK) Obihiro Branch in Hokkaido is working together with vocational aid centers for the mentally and physicallychallenged and its customers to make the centers economically viable. It is having considerable success in creating a framework
for taking advantage of regional characteristics by among other things starting a paper bag recycling business at two centers, At
Home Memuro and Nozomi-en. Paper bags left over from the processing of adzuki beans produced in the Tokachi area of
Hokkaido, where Obihiro is located, are reused in packaging potatoes.
Special Lectures to Junior High School Students
The manager of MHBK's Nagano Chuo Branch, who is also an Examining Member of the Security Analysts Association of Japan,
gave a lecture on finance to the students of the local Sakuragaoka Junior High School in Nagano City. At the school's request, hegave a special talk on securities investment to third-year students as one of their elective subjects in social studies.

Contributions to Local Communities Overseas
Activities in U.S.
Mizuho group staff members and their families in the U.S. are active participants in various volunteer activities. Their involvement and dedication are furthered by the philanthropic contributions of the Mizuho group companies, who are significant supporters of local community
revitalization. For example, The IBJ Foundation has since its establishment in 1989 contributed
some US$5.5 million to local educational institutions and community development organizations in keeping with its goals to foster the "Education of Global Citizens," "Strengthening of
Urban Communities" and employee "Community Involvement." In January 2002, Neighborhood
The Neighborhood Housing
Services award presentation
ceremony

Housing Services, a not-for-profit organization in New York, recognized the Foundation's
sponsor, The Industrial Bank of Japan Trust Company, together with the Fuji Bank and Trust
Company, for their many years of contributions to local communities. The DKB Foundation has
donated a total of US$1 million through its activities since its inception in 1993.
Activities in Asia
Our employees both in Japan and at our operations in Thailand, Indonesia, China and Taiwan
contributed to the local communities by donating funds and engaging in support activities for
disadvantaged children.
The Mizuho Financial Group (MHFG) provided assistance with scholarships in Southeast Asia

52

Mizuho Aishin Charity Fundpresentation ceremonyand engaged in philanthropic activities in Taiwan through the Mizuho Asian Fund and theMizuho Aishin Charity Fund.

Activities of Philanthropic Foundations
MHFG supports the following philanthropic foundations in their work in the areas of social welfare, education, scholarships, international exchange and academic research.
Mizuho Education Welfare Foundation (established 1972)
This foundation engages in assisting various activities, supporting education in rural areas andproviding education for physically challenged children and welfare assistance for senior citizens.
It has also donated a cumulative total of 228 welfare vehicles, or "Heart" automobiles, to nursing care homes for senior citizens throughout Japan.

Presentation of a welfare vehicle

Mizuho Welfare Foundation (established 1980)
This foundation tackles social welfare issues centered on the welfare of the disabled, providing
grants for social welfare, funds for translating books into Braille for visually-impaired university
students (cumulative total: 100 students) and electrically-powered wheelchairs (cumulative total
500). Since its founding, it has also donated a total of 183 buses and microbuses equippedwith elevators for the mentally and physically challenged.
Mizuho International Foundation (established 1991)
This foundation was set up primarily to provide scholarships for overseas students studying inJapan. Since its founding, it has assisted a cumulative total of 112 students, 27 of them doctoral candidates. It is also engaged in activities to train younger people to undertake work in
the area of international exchange.

Scholarship alumni

Mizuho Foundation for the Promotion of Sciences (established 1957)
This foundation was established to encourage academic research by young people. It provides
grants for young engineering researchers recommended by universities, holds essay contests inthe areas of law and economics (from among the public) and offers scholarships to overseas
students studying in Japan who are selected by their universities.
Mizuho Scholarship Foundation (established 1954)
This foundation was established to foster human resources by providing scholarships for excellent students recommended by universities who face economic hardships. Since its founding, it
has granted scholarships to 672 people.

Support for Art and Culture
Coming-of-Age Day Concerts
This year's "Coming-of-Age Day Concert" took place at the Suntory Hall in Tokyo on the
Coming-of-Age Day national holiday (January 14, 2002). The program was extremely varied,featuring violinist Eijin Nimura, ballet dancer Hana Sakai, conductor Kazushi Ono and the
Vaganova Academy of Ballet. These concerts have been held since 1990 with a view to supporting young artists and popularizing classical music among the next generation of young people.

Eijin Nimura
Hana Sakai

MIZUHO STREET GALLERY
The MIZUHO STREET GALLERY uses the window display areas of Mizuho Bank's Ginza Chuo
and Sukiyabashi branches to show works by various artists. The aim is to discover and support
young artists and provide space where they can display original works of art and send out messages that blend in well with the main streets of Tokyo's bustling Ginza area.

Ginza Chuo Branch

53

Environmental Awareness of Mizuho

Basic Approach• We are aware that it is our social responsibility to take into account environmental issues as wetry to maintain a balance between economic development and environmental preservation.
• In compliance with laws and ordinances relating to the environment, we will engage inenergy and resource conservation efforts that include separating and collecting garbage by
type, and using recycled materials.
• In addition to supporting environmental protection organizations and our customers’ programs for dealing with environmental issues, we will offer financial products and services
that contribute to environmental preservation.

Developing Environment-Related Financial Products andAdvisory Services
We offer the following services to support the endeavors of customers in the environmental area.
• Surveys and advice relating to the risks faced by customers following the adoption of the
Kyoto Protocol and the passage of the Law for the Prevention of Soil Pollution, and measures
for managing such risks.
Glossary• Advice and financial products associated with greenhouse gas emissions trading and clean
development mechanisms (CDM).

CDM
This mechanism allows the emissions
credits achieved by developing nations
through greenhouse gas emissionreduction projects to be transferred toindustrialized nations as emissions
rights.

• Economic evaluations of investments in projects whose purpose is to acquire greenhouse gas
emission rights, advice on the associated risks, and arrangement of finance.
• Sales of weather derivatives and advice on using them.
• Support for implementing life cycle assessments (LCA), and consulting in connection withacquiring ISO14001 certification.

LCA
LCA (Life Cycle Assessment) is a process
for evaluating the environmental burdens imposed by a product throughout
its life cycle, from procurement of raw
materials, manufacturing and use toeventual disposal as waste.

Environmental Risk Assessment in Financial Operations
There has been an increase in the number of cases where MHFG evaluates the environmental
risk associated with companies and businesses. In the area of M&A, some cases involve factoring in the environmental risks posed by the potential acquisition. In project finance, there arecases where assessments of the project's impact on the environment are reflected in the credit
decision or the terms of the contract. MHFG is developing measures on how to evaluate theseenvironmental risks.

Philanthropic Activities Related to the Environment
We support the “All-Japan Elementary and Junior High School Students’ Environmental Art
Contest.“ The contest is designed to promote environmental education among primary andEnvironmental Art Contest display

junior high school students.

Project Financing for Japan's First Wind Power Generation
Business to Make Use of the Green Power Certification System
Mizuho Corporate Bank (MHCB) has
concluded a project finance contract
with Choshi-Byobugaura Wind
Power Development, which isJapan's first wind-power generation
business to use the Green Power
Certification System.
54

Tokyo Electric Power
Company

Sell electric power

Japan Natural Energy
Company Limited

Sell environmental
added value

Sell environmental
added value

Issue Green Power
Certification

Sony Corporation

Choshi-ByobugauraWind Power
Development
Project
Finance
MHCB

56

Management Structure of Mizuho
Management Structure of Mizuho Holdings

56

Profit Management System of Mizuho

58

Human Resources System of Mizuho

59

55

Management Structure of Mizuho

Management Structure of Mizuho Holdings• Four directors not concurrently serving as Executive

Management Framework of Mizuho
Financial Group

Officers.
(The President & CEO of Mizuho Corporate Bank (MHCB),On April 1, 2002, the Mizuho Financial Group (MHFG)

the President & CEO of Mizuho Bank (MHBK), and two

adopted a management framework where legally separate

outside directors of MHHD.)

subsidiaries according to customer segments and businesslines are managed under Mizuho Holdings (MHHD), theTo strengthen the management and monitoring functions

holding company, whereby a new organization centered onof the Board of Directors, directors not concurrently serving

four core subsidiaries was created.
Under the new structure, MHHD fulfills optimum administrative functions by implementing various measures designed
to enhance the group's overall capabilities such as formulat-

as Executive Officers, including the outside directors, participate in the board meetings from a position that is independent of actual execution of business operations.

ing group strategies and business portfolio strategies,

Executive Officer Systemstrengthening risk management, compliance and internal

MHHD adopts the Executive Officer System in order to sepa-

auditing functions, and realizing synergies among grouprate managerial decision-making and execution, and clarify

companies.

levels of authority and responsibility.
The President & CEO manages the entire group according

Management Structure of Mizuho
Holdings

to the fundamental management policies determined by the
Board of Directors.
The Executive Officers comprise the President & CEO andBoard of Directors
The Board of Directors of MHHD consists of eight members,

Deputy Presidents, who concurrently serve as directors, andwho determine important matters pertaining to manage-other Executive Officers, who are not directors, entrusted

ment policies for the holding company and group compa-

with and responsible for specific business areas.

nies, as well as matters stipulated by laws and regulations.
• Four directors concurrently serving as Executive Officers,
including the President & CEO.

Organizational Structure of Mizuho Holdings
General Meeting of Shareholders

Corporate Auditors
Board of Corporate Auditors

Corporate Auditors Office

Executive Management Committee
Customer Satisfaction Office
Executive Secretariat
Business Policy Committees

Strategic Planning Group
Financial Control and Accounting Group

Board of Directors

President & CEO

Risk Management Group
Human Resources GroupInternal Audit &Compliance Committee

IT, Systems & Operations Group
Audit and Compliance Group56

Executive Management Committee

Organizational Structure

The Executive Management Committee has been established

MHHD has established the Strategic Planning Group, theto serve as an advisory body for the President & CEO. The

Financial Control and Accounting Group, the Risk

Executive Management Committee consists of the PresidentManagement Group, the Human Resources Group, the IT,& CEO, Deputy Presidents and the heads of all groups (theSystems & Operations Group, and the Audit and Compliance

Executive Officers in charge of each group). To ensure thatGroup.

basic group strategies are effectively discussed, the President

Each group is responsible for formulating strategies for& CEO of MHCB, and the President & CEO of MHBK also

the group as a whole including business portfolio strategy,

participate.

management of group subsidiaries through business perfor-

Where necessary, the President of Mizuho Securities

mance evaluation, risk management and compliance moni-(MHSC) and the President and CEO of Mizuho Trust &toring, as well as planning, promotion and coordination of

Banking (MHTB) also participate in the Committee’s meet-group synergy strategies.

ings.
Board of Corporate Auditors
The Board of Corporate Auditors comprises five corporate
auditors, including three outside auditors.
Business Policy Committees
Six Business Policy Committees have been established toserve as forums for the discussion and coordination of company-wide issues of concern to the Executive Officers. The
Committees include the Planning & Financial Control
Committee, the Portfolio Management Committee, the ALM& Market Risk Committee, the IT Strategy Committee, theGlobal Strategy Committee, and the MHFG Synergy
Promotion Committee.
Internal Audit & Compliance Committee
The Internal Audit & Compliance Committee fulfills an internal audit function under the President & CEO, who acts aschairman.
The Committee utilizes its extensive checking and verification functions to ensure that business operations are carriedout in an appropriate manner from the viewpoint of compliance and audit.

57

Management Structure of Mizuho

Profit Management System of Mizuho

Profit Management System Based on
Legally Separate Subsidiaries According
to Customer Segments and BusinessLinesframeworks of the group. Each group and business unit

We have adopted a basic policy that aims to reinforce our

Basically, both banks have adopted a common profit

financial strength through vigorous measures to increase

management system and framework, but in actual opera-

profitability and cut costs. Centered on MHHD, we conduct

tions take a flexible and swift approach that matches theirprofit management for the group, primarily for the fourindividual business models.

core subsidiaries—MHCB, MHBK, MHSC, MHTB—whichhave been consolidated and reorganized according to cus-

capital and RAROC is then used as a performance index toevaluate the return on allocated risk capital.

Consolidated Profit Management
While each core subsidiary enhances its own profitability,

tomer segments and business lines.
More specifically, we have clarified the strategic positions

we manage their profits on a consolidated basis as a meansof the core subsidiaries within the group on the basis of ourof building an optimal business portfolio that is balanced

group business portfolio strategy and, having ensured theirfor the entire group.

autonomy and independence while bringing them closer

Specifically, in addition to the four core subsidiaries, wetogether through the unifying force of MHHD, we are seek-

formulate profit plans and manage performance for theing to maximize group corporate value.

strategically important subsidiaries and include their profits

Regarding the four core subsidiaries, we are making
efforts to optimize our business portfolio, managing profits
through the following:• Formulating plans for net business profits and net
income, and carrying out performance management.
• Allocating management resources such as personnel,

with those of the four core subsidiaries.

Allocation of Risk Capital
In an environment where the financial sector faces progressive deregulation and globalization and financial technology
grows in sophistication, financial institutions muststrengthen their profitability while managing various types

investment and risk assets.
• Risk controls and profitability assessments based onof risk.
Based on MHHD's business portfolio strategy, we haveallocation of risk capital.
Further, each branch and division of the four core subsidiaries establishes its own profit plan according to the
management policy, overall profit plans and resource allocations drawn up by MHHD and manages its performance.
MHCB has built its profit management system based on
the business operations section including the business units,
while MHBK has built a profit management system centeredon two axes—the group and the business promotion planning section. Each section of the two banks has been given
authorities and responsibilities concerning profits, allowing

introduced a management structure under which optimized
business activities are conducted within the limits of allocations of risk capital drawn from equity capital and othersources.
Under this framework, RAROC is used as an index toevaluate performance in terms of return on allocated risk
capital at the level of the holding company and the four
core subsidiaries. Our aim as a group is to improve capitalefficiency by allocating resources more efficiently based on
the results of these evaluations.

rapid decision-making and more efficient allocation of man-Glossary

agement resources.

RAROC (Risk-Adjusted Return on Capital)

Both banks have also introduced the allocation of risk
capital, which is one of the most important management

Risk Capital Allocation

58

engages in business activities within the limits of that risk

RAROC is a measure of the profitability of allocated capital and is used as an index
for assessing capital efficiency. RAROC is calculated by dividing risk-adjusted profits(profits adjusted to reflect statistically expected risk) by capital.

Allocation of risk capital to the four core subsidiaries

Management resources allocation function

Risk-based profitability assessments

Risk control function

Management to preserve allocated risk capitalManagement Structure of Mizuho

Human Resources System of Mizuho

Vision for Human Resources: ROE on
Human Resources Investment

In this vision, “ROE” stands for the following:
Responsibility: Observe the principles of independentjudgement and self-accountability.

MHFG and its employees set a shared vision for humanOpportunity: Provide equal opportunity.

resources as follows:“We promote the ‘ROE’ principle for human resources

Employability: Develop expertise to enhance competi tiveness.

with a view to lasting value creation and create an attractive
and fulfilling working environment for employees.”

Optimize uniqueness of group companies and synergies
Essenceof HumanResources
System

A compensation system linked to job and performance
Provide “Professional Career Path”

Optimize Uniqueness of Group
Companies and Synergies

Provide “Professional Career Path”
We designed multi-featured compensation systems that

Employees are employed by one of the group companies

meet the needs of employees and an increasingly fluid labor(MHHD, MHCB, MHBK, MHSC, MHTB), in order that we canmarket.

create a group of specialists that can deliver maximum innovativeness and speed for actions and decisions. At the same

One example is the “Professional Career Path,” with asalary system that is in line with market standards.

time, we are maximizing synergies between personnel andpromote optimal human resources allocation across groupcompanies, which is facilitated by the common basic compensation system (Common Platform for Human Resources).

A Compensation System Linked to Job
and Performance
We have introduced a compensation system linked to job
and performance.
We pay salaries according to job grade that is determinedby job responsibilities and other factors.
As for retirement benefits, we have introduced a combination of “basic retirement benefits” (based on job grades)and “performance-based retirement benefits.”

59

Management Structure of Mizuho

Human Resources System of Mizuho

Common Platform for Human Resources
MizuhoHoldings

MizuhoCorporate
Bank

MizuhoSecurities

MizuhoBank

Mizuho Trust& Banking

Management-class platform (stock options, etc.)
Reflect the independenceof each group company
through market pricing,risk / return structure
and value-added

Promote cross-company personnel exchanges using a portable retirement benefits system, etc.,
while maintaining the culture and autonomy of each group company.

Proactive personnel exchanges across group companies.

CommonPlatform

Welfare benefits platform(health insurance association, employees’ pension funds, cafeteria plan, etc.)
Human resources framework platform(career paths, job groups, job grades, group internal recruiting system, etc.)

Establishing a New Mizuho Corporate
Culture(5) Being accountable for all actions.

With the reorganization of the former three banks to

These values shall be shared by all employees and beform MHCB and MHBK, the management determined tothe basis for a 360-degree employee performance evalua-take the initiative to create a sense of innovation amongtion.

employees, and aims to create a new Mizuho corporate
culture.
Specifically, a personnel evaluation system will be put
in place in which the following will be stressed:

At the same time, to quickly promote a sense of unity
within the group and to revitalize the resources of ourorganization, we will promote such policies as placing theright employee in the right job irrespective of the(1) Possessing a “customer-first” corporate objective.

employee’s bank of origin, as well as active transfers of(2) Facing the challenges of innovation.

human resources among all group companies.

(3) Being rational and fair in making decisions.

60(4) Placing more importance on speed of actions.

62Internal Control Systems of Mizuho
Risk Management Structure of Mizuho

62

Compliance Structure of Mizuho

71Internal Audit Structure of Mizuho

7261

Internal Control Systems of Mizuho

Risk Management Structure of Mizuho

Commitment to Risk Management

Overview of the Risk Management
Structure

Basic Approach

Each group subsidiary adopts the most appropriate risk man-

Progress in financial deregulation and internationalization has

agement measures for its business and the size and nature of

led to rapid growth in the diversity and complexity of bank-its risk exposures, while MHHD controls risk management foring operations, exposing financial institutions more than ever

the group as a whole.

to various kinds of risk such as credit, market operations, IT,

More specifically, MHHD regularly and as required receives
reports from the four core subsidiaries (MHCB, MHBK, MHSC

legal and settlement risks.
We are well aware that in order to raise our corporate

and MHTB) on their risk management situation and approves

value while ensuring the health and stability of our banking

certain risk limits based on the risk management policies

business, adopting risk management and control measures

adopted by the Board of Directors of MHHD.

that match our operations and their inherent risks is an issue

MHHD also monitors the risk profile of the entire group,of key importance to management. For this reason we are

and gives appropriate instructions on risk management to thetaking steps to strengthen our risk management structure.

four core subsidiaries.

Based on this awareness, MHHD's Board of Directors has

Each of the four core subsidiaries also sets up its own risk

laid down risk management policies that are applicable tomanagement policies for various risks. It also regularly and as

MHFG for managing specific types of risk. These policies

required receives reports and applications from its own groupclearly define the kinds of risks to be managed, establish thecompanies on the risk profile based on its policies. Each oforganizational structure and train the human resources nec-

the four core subsidiaries also monitors the risk profile foressary for appropriate levels of risk management and provide

itself and its own group companies, and gives appropriate

for audits to measure the effectiveness and suitability of the

instructions on the risk management to the group compa-

risk management structure.

nies.

In line with these policies, we have clarified the framework
for managing each type of risk and are working to

In this manner, MHHD and its four core subsidiaries manage overall risk for other group companies.

strengthen risk management by adopting various measuresand striving to enhance the sophistication of our risk management procedures.

Mizuho Financial Group's (MHFG) Risk Management Structure

Set risk management policies
Give instructions concerning
risk management

Four core subsidiaries

Give instructions concerning
risk management

Mizuho Corporate Bank(MHCB)

Mizuho Holdings(MHHD)

Mizuho Bank (MHBK)
Report on therisk management situation

Mizuho Securities(MHSC)

Report on risk profile

The groupcompanies ofthe four coresubsidiaries

Mizuho Trust & Banking(MHTB)

Risk management by four core subsidiaries(Including the group companies ofthe four core subsidiaries)
Manage overall risk for MHFG
* For matters relating to risk management, compliance management and internal audits of other group companies, MHHD manages these companies through the four core subsidiaries.

62

Integrated Risk Management

Risk Capital Allocation
We have introduced an integrated risk management frame-

Basic Approachwork as a means of obtaining the clearest possible grasp of

We define integrated risk management as controlling risk

the group's overall risk exposure. We have also initiated mea-

within managerially tolerable limits through consolidated

sures to keep such risk within the group's financial base.

management of risks belonging to different categories byMore specifically, MHHD allocates risk capital to the four

grasping the existence and scale of risk in a timely and accu-

core subsidiaries, covering their own group companies, inrate manner. We then take appropriate measures to deal

accordance with applications from the four core subsidiaries,

with it as necessary before or after the fact, while establish-

to control risk within the limits set for each company. We

ing management frameworks centered on risk capital alloca-

also control risk within managerially tolerable limits by work-

tions.

ing to ensure that the overall risk borne by the group on a

In the management of risk, there are credit risk management and market risk management, which aim to secure

consolidated basis does not exceed the capital account andother measures of financial strength.

profits by appropriately controlling risks, and operations risk,

To ensure the ongoing financial health of MHFG, MHHD

IT risk and legal risk management, which seek to avoid losses

and the four core subsidiaries, we regularly monitor how thisby averting risk.

risk capital is being used in order to obtain a proper grasp of

We use quantitative methods to control total credit andthe risk profile within this framework. Reports are also sub-market risk in line with basic group-wide policies towards

mitted to the Board of Directors, as well as the Executive

consolidated risk management laid down by MHHD. We also

Management Committee and the Business Policy Committee

take a proactive approach to enhancing the sophistication ofof each company.

our risk management methods by tailoring them to the characteristics of different types of risk.
Allocation of Risk Capital(Example)

MHHD

MHFG'sfinancial strength

MHCB

MHFG'srisk exposure

MHCB

MHBK
Capital account, etc.

Four coresubsidiaries'
risk exposure

MHSC

MHTB

Other risk exposure

Credit risk

Allocatedrisk
capitalMarket risk
Equity risk
MHCB's groupcompanies, etc.

MHBK

MHSC

MHTB

* Including risk exposure of the group companies of the four core subsidiaries.

63

Internal Control Systems of Mizuho

Risk Management Structure of Mizuho

Credit Risk Management

risk by controlling the entire process for each individual transaction, from granting the credit through to recovery, on thebasis of assessments of the credit standing of the counterpar-

Basic Approach
We define credit risk as a financial institution’s exposure to
the risk that it might incur losses because of a decline in, or
total loss of, the value of assets (including off-balance-sheet
assets) as a result of deterioration in a counterparty’s financial position. The group has already established the methods
and structures necessary for grasping and managing credit
risk, which has become increasingly complex because ofties involved. This first approach is primarily the responsibilityof the four core subsidiaries. The second is to manage theentire portfolio using statistical methods to measure thepotential for credit risk in order to grasp the existence andscale of credit risk in a timely and accurate manner. This second approach is the responsibility of the four core subsidiaries
as well as MHHD, which has group-wide accountability.

financial deregulation, internationalization and the growing
sophistication of transactions.
We have adopted two different but mutually complementary approaches toward credit risk management. The first ofthese is to curb losses arising from the emergence of credit

tant matters pertaining to credit risk in accordance with ourcredit risk management policy. Also, as one of the business
policy committees, the Portfolio Management Committee
folio management for MHFG. The Risk Management

MHHD

Department and the Credit Risk Management Department,
both of which are under the responsibility of the Chief Risk

CEO

Executive Management Committee

Officer (CRO), jointly formulate and execute plans in connec-

Portfolio Management Committeetion with basic matters relating to credit risk management.
Of the four core subsidiaries, MHCB and MHBK have

Head of Risk Management Group(CRO)
Risk Management
Department

The Board of Directors of MHHD determines the most impor-

was established to discuss and coordinate overall credit port-

MHFG's Credit Risk Management Structure

Board of Directors

Credit Risk Management Structure

adopted a credit risk management framework in conformance with MHFG's uniform credit risk management policy.

Credit Risk Management
Department

In addition to establishing credit risk management divisions• Set risk management policies• Give instructions concerning
risk management• Report on therisk management situation

with the functions of managing credit exposure and measuring and monitoring credit risk, they have set up independent
credit review divisions to provide checks and balances.
Individual transactions are approved through lines of author-

MHCB

MHBK

MHSC

MHTB

ity that conform to the above-mentioned basic policies.
MHCB and MHBK use the unified credit rating system andcredit risk measurement tools to ascertain and monitor the

Aims and Application of Credit Ratings
 Reflect credit policies in daily
credit management

 Preparation for self-assessments,
write-offs and provisions

 Administer and manage
the credit portfolio

64

Quantify credit risk
Apply credit rating
Appropriate
credit risk
management

Appropriate pricing

status of their portfolios, and manage them within credit lim-

parties or corporate groupings. It also involves monitoring ofits. They are also improving their credit decisions and post-

credit concentration in certain industrial sectors, geographicaltransaction management functions by assessing individual

areas or countries to avoid any deterioration in the credit

transactions from these viewpoints, auditing the results ofstanding of transactions caused by economic fluctuations

self-assessments and providing risk management guidance tothat may lead to an increase in “Unexpected loss,” Credit

individual branches.

limits are set where necessary.

MHTB and MHSC follow credit risk management proce-

Credit portfolio management as mentioned above is thedures that suit the characteristics of their respective business

responsibility of MHCB and MHBK in principle, but MHHD

sectors.

also monitors and manages the group's entire credit portfo-

MHHD manages its four core subsidiaries based on its

lio.

credit risk management policy. After obtaining an overall picture of the group's risk profile from reports submitted by the

Expected Loss and Unexpected Loss Amounts

four core subsidiaries, it adopts whatever measures it may

Frequency

deem necessary.
Average

One of the most important elements of our risk management is to follow objective indications of a customer’s creditworthiness through our credit rating system. We determine aThis amount depends onthe confidence interval. For
example, if the confidence
interval is set at 99%, it is
the 9,900th smallest loss
figure out of 10,000 trials.

customer’s credit rating using quantitative financial assessments as well as qualitative judgments such as the assessment on the customer's strength in its business.

Loss amountOur new unified credit ratings system provides integrated
coverage of companies ranging from large corporations tosmall and medium-sized, and middle market enterprises, andMaximum loss amounts

(a)

(b)

Expectedloss amounts

Unexpected loss amounts

takes ample steps to ensure consistency with the ratings ofexternal rating agencies and borrower classifications.

Portfolio Management Structure
Portfolio-based credit risk management uses statistical methods to calculate the possibility that our credit portfolio may
generate bad debt losses. There are two key figures.
“Expected loss” is the average amount of loss forecast for
the next 12 months. “Unexpected loss” is the maximum
excess amount in the case where losses exceed the expected
loss.
“Expected loss” should be covered out of profits on credit
transactions, and is used as a reference value when setting
transaction guidelines. “Unexpected loss” should be coveredout of total capital, when it actually materializes. The credit
portfolio, therefore, is monitored from various angles toensure that unexpected losses are kept within the level of theallocated risk capital, and limits are applied to the portfolio
where necessary.
In practice, credit portfolio management involves monitoring concentration risk and, where necessary, setting credit
limits to curtail any increase in “Unexpected loss” arisingfrom granting too much credit to certain individual counter-

65

Internal Control Systems of Mizuho

Risk Management Structure of Mizuho

Market and Liquidity Risk Management

Market Risk Management Structure
MHHD's Board of Directors determines key matters pertain-

Basic Approaching to market risk management. The CEO has overall control

We define market risk as the risk that the company couldof market risk management. The ALM & Market Risk

incur losses because of changes in the value of assets and lia-

Committee is responsible for overall discussion and coordina-bilities (including off-balance-sheet assets) caused by fluctua-tion of market risk management.

tions in market risk factors such as interest rates, foreign

Specifically, the committee discusses and coordinates mat-exchange rates and bond and stock prices. In our definition,ters relating to basic ALM policies, risk planning, fund pro-it includes the risk of losses incurred when it becomes impos-

curement and asset management, and market risk

sible to execute transactions in the market because of market

management, and proposes responses to emergencies such

confusion, or loss arising from transactions at prices that are

as sudden market changes.

extremely less favorable than usual (market liquidity risk).
We define liquidity risk as the risk of losses arising when
the group faces funding difficulties because a deterioration inits financial position makes it difficult to raise the necessary
funds, or when it is forced to procure funds at much higher

VAR on Trading Activities in the Fiscal Year ended
March 31, 2002
(VAR, ¥ billions)1412interest rates than usual.
MHHD manages market and liquidity risk for the group as

10

a whole. More specifically, MHHD formulates basic market

8and liquidity risk management policies for the entire group,

6

Maximum: ¥12.0 billion
Minimum: ¥6.2 billion
Average: ¥9.7 billion

and the four core subsidiaries follow these policies in manag4

own groups. This system also allows MHHD to monitor and2

manage the overall market and liquidity risk management0

profile for the group.

MHFG's Market and Liquidity Risk Management
Structure

Quantitative standards used for calculating VAR
Confidence interval: one-tailed 99.0%
Holding period: 1 day
Historical observation period: 1 year

MHHD

Board of Directors

Executive Management Committee

CEO

01.4.201.4.1601.4.30
01.5.1401.5.28
01.6.1101.6.25
01.7.901.7.23
01.8.601.8.2001.9.301.9.1701.10.1
01.10.15
01.10.29
01.11.12
01.11.26
01.12.10
01.12.24
02.1.702.1.2102.2.402.2.18
02.3.402.3.18

ing risk for themselves and companies belonging to their

VAR on Banking Activities in the Fiscal Year ended
March 31, 2002
(VAR, ¥ billions)

ALM & Market Risk Committee
Head of Risk Management Group
(CRO)

400
350
300

Risk Management Department
250• Set risk management policies• Approval of limits• Give instructions concerning
risk management200• Report on therisk management situation• Applications for limits

Maximum: ¥372.9 billion
Minimum: ¥265.7 billion
Average: ¥324.6 billion

150
100

MHCB

MHBK

MHSC

MHTB

0

01.4.201.4.1601.4.30
01.5.1401.5.28
01.6.1101.6.25
01.7.901.7.23
01.8.601.8.2001.9.301.9.1701.10.1
01.10.15
01.10.29
01.11.12
01.11.26
01.12.10
01.12.24
02.1.702.1.2102.2.402.2.18
02.3.402.3.18

50

Quantitative standards used for calculating VAR
Confidence interval: one-tailed 99.0%
Holding period: 1 month
Historical observation period: 1 year

66

The CRO is responsible for matters relating to market risk

We can therefore judge the impact of interest rate movements on net present value more accurately even whenmanagement planning and operations.
The Risk Management Department is responsible for moni-short- and long-term interest rates behave differently.

toring market risk, reports and analyses, proposals, setting

To manage market risk, limits that correspond to risk capi-

limits and guidelines, and for formulating and implementing

tal allocations are set according to the nature of the various

plans relating to market risk management.

businesses in which the four core subsidiaries engage. For

The four core subsidiaries have established risk manage-

trading activities, limits are set for VAR and for losses. For

ment divisions according to the scale and nature of their mar-non-trading activities such as banking operations, where nec-

ket risk exposures to manage them at the individual company

essary, limits are set for VAR and for losses. Position limits

level. In addition to that, specialized risk management sec-

based on interest rate sensitivity are also set where necessary.

tions (middle offices) are set up at each of the offices that

These limits are discussed and coordinated by the ALM &Market Risk Committee, discussed further by the Executive

engage in trading.
MHHD's Risk Management Department receives necessary

Management Committee, then determined by the CEO. At

data and reports on the status of market risk, including com-each stage, various factors are taken into account, such aspliance with risk limits, from the four core subsidiaries. Basedbusiness strategies, historical limit usage ratio, risk bearing

on this information, it obtains a solid grasp of the market risk

capacity (profits, total capital and risk management systems),

management situation and submits reports to the CEO on a

profit targets and the market liquidity of the products

daily basis, and to the Board of Directors and the Executive

involved.

Management Committee, both on a regular basis and as

Market liquidity risk is monitored and managed using themost-suitable methods available for each type of financial

deemed necessary.
We manage market risk using Value at Risk (VAR) as our

instrument.

principal measuring tool, supplementing it with stress testing.
In fiscal 2001, VAR on trading activities averaged ¥9.7 billion(confidence interval: one-tailed 99.0%; holding period: oneday), ranging from a minimum of ¥6.2 billion to a maximumof ¥12.0 billion. VAR on banking activities (excluding crossshareholdings) averaged ¥324.6 billion (confidence interval:

Glossary
VAR (Value at Risk)
VAR is one of several methods used to measure market risk. It is defined as the
maximum possible loss that could be incurred on our portfolio as a result of market movements within a certain period (holding period) and degree of probability(confidence interval). The actual amount of the VAR may vary according to thelength of the holding period and the confidence interval, as well as the models
used for measuring the volatility of market risk factors.

one-tailed 99.0%; holding period: one month), ranging froma minimum of ¥265.7 billion to a maximum of ¥372.9 billion.
With regard to interest rate risk, which constitutes themain form of market risk on banks’ market activities, we conduct interest rate sensitivity analyses as well as VAR measure-

BPV (Basis Point Value)
This index of interest rate sensitivity shows the extent to which the value (netpresent value) of a position increases or decreases when interest rate levels
change by 1 basis point (0.01%). Normally, ceilings are set for each interest raterelated position limit in order to allow finely-tuned management of positions.

ments. The following table depicts the interest rate sensitivityof the yen currency banking operations, by maturity, of theprincipal offices of the three banks (DKB, Fuji Bank and IBJ) asof the end of fiscal 2001. Interest rate sensitivity (10BPV)
shows how much net present value varies when interest rates
rise by 10 basis points (0.1%).

Fiscal 2001 Interest Rate Sensitivity by Maturity(Aggregated figures of the three banks)
At March 31, 2002

Billions of yen
1 year (Over 1 year, up toor less and including 5 years)

Interest rate sensitivity(10BPV)

(1)

(38)

Over
5 years

Total

(26)

(65)

67

Internal Control Systems of Mizuho

Risk Management Structure of Mizuho

Fiscal 2001 Back Testing
DKB

Fuji Bank
profits / losses (absolute value) (¥ billions)
3.5

profits / losses (absolute value) (¥ billions)
3.5

3.0

3.0

3.0

2.5

2.5

2.5

2.0

2.0

2.0

1.5

1.5

1.5

1.0

1.0

1.0

0.5

0.5

0.5

0

0

0.5

1.0

1.5

2.0

2.5
3.0
3.5
VAR (¥ billions)

Notes 1. Including major subsidiaries managed by
the bank.
2. Profits / losses is actual basis.

0

0

0.5

1.0

2.0

2.5
3.0
3.5
VAR (¥ billions)

0
0

0.5

1.0

1.5

2.0

2.5
3.0
3.5
VAR (¥ billions)

Notes 1. Including major subsidiaries managed by
the bank.
2. Profits / losses is assumptive basis.

during the period longer than ten years, and another that

In order to confirm the effectiveness of market risk measurements using VAR, we carry out regular back tests to compare
VAR and profits / losses.
The above graphs depict daily VAR on the trading activitiesof the three banks in fiscal 2001, and the corresponding
paired distribution of profits and losses. The points in thearea above the diagonal line on the graph (the upper left
hand section) indicate where profits / losses exceeded VAR.
The distribution for the excess ratio under the internal VAR
measurement model is centered around 2% (100% - (bothsides of the confidence interval) 98%). There were 1-3 cases
where profits / losses exceeded VAR during the period, yielding an excess ratio of 0.4% - 1.2%. We believe this confirmsthat our internal models are sufficiently accurate in measuring each bank's market risk exposure.

calculates losses on the basis of market fluctuations duringhistorical market events.
The lower left table shows the results of stress testing at
the end of fiscal 2001.

Liquidity Risk Management Structure
Our liquidity risk management structure is fundamentally thesame as the market risk management structure describedabove. However, the head of the Financial Control andAccounting Group is additionally responsible for mattersrelating to planning and running cash flow management
operations, while the ALM and Trading Planning Department
is responsible for monitoring and adjusting the cash flow
management situation and for planning and implementing
cash flow management. Reports on the cash flow situation
are submitted to the ALM & Market Risk Committee, theExecutive Management Committee and the CEO, both regu-

Stress Testing
As a market risk measurement method, VAR is based on statistical assumptions. For this reason, we carry out stress testing to simulate the levels of losses that could be incurred incases where the market moves suddenly to levels that exceed
these assumptions.
The stress testing methods we use include one methodthat calculates losses on the basis of the largest fluctuations

larly and as required.
We measure liquidity risk using indices pertaining to cash
flow such as limits on funds raised in the market. Limits on
liquidity risk are discussed and coordinated by the ALM &Market Risk Committee, discussed further by the Executive
Management Committee, then determined by the CEO.
MHHD’s risk management policies have established classifications for the cash flow conditions affecting MHFG, ranging
from “normal” to “cause for concern” and “critical,” andFiscal 2001 Stress Testing
At March 31, 2002

1.5

Notes 1. Including major subsidiaries managed by
the bank.
2. Profits / losses is actual basis.

Back TestingBillions of yen

Worst scenario (the largest fluctuations during the period
longer than ten years)

has laid down response procedures for dealing with cases
where conditions are deemed “cause for concern” or are

Assumed maximum losses

68

IBJ

profits / losses (absolute value) (¥ billions)
3.5

17“critical.”MHFG Operational Risk Management
Basic Approach

Management of Other Risks
Operations Risk Management

We define operational risk as the risk of loss that our group

Operations risk is the risk of incurring losses because senior

may incur resulting from inadequate or failed internal

executive officers or employees fail to fulfill their tasks prop-

processes, people and systems or from external events.

erly, cause accidents or act improperly.

This definition includes operations risk, IT risk and legal
risk.

The computer systems problems and operational confusionthat occurred in Japan at the time of the launching of MHCBThe need to manage these risks across the entire group

and MHBK have reinforced our awareness that this kind of

through quantification methods becomes increasingly urgent

risk has a direct impact on services to customers. We are alsowith each passing year.

aware that we bear a great responsibility towards society

From the same standpoint, the Basel Committee on Bank-

because each time something like this happens, it can easilying Supervision is currently working on new BIS rules tocause major losses for all concerned. For these reasons, we

include operational risk within capital adequacy guidelines

are working hard to build a management structure that isalong with market and credit risk.

more attuned to the situation.

We are actively pursuing more sophisticated operational

MHHD has drawn up the fundamental policy for opera-

risk management while participating in the internationaltions risk management for use across the entire group, andforum on new BIS rules.

the four core subsidiaries have in turn set out their own fun-We will further strengthen the management of operational

damental policy for managing operations risk in conformancerisk of the entire group, seriously recognizing the majorwith MHHD's policy. The four core subsidiaries report to

impact of operational risk that was illustrated in the recent

MHHD on the status of risk management both regularly andcomputer systems problems at MHCB and MHBK.

as required under these policies. In this way, top manage-

Overview of the Risk Management
Structure

ment is able to obtain a rapid and accurate grasp of operations risk at group level, and thus devise effective measuresfor dealing with it.

We have developed a risk management structure where
MHHD draws up an operational risk management policy for

IT Risk Management

use by the entire group, and the four core subsidiaries have

IT risk is the risk of being exposed to tangible or intangible

in turn set out their own risk management policies based onlosses arising from system defects such as failures, faults, or

MHHD's policy to manage their own risk and that of theirincompleteness in computer operations.

group companies.

We are keenly aware that we bear a great responsibility

At MHHD, the Risk Management Department is responsi-

towards society where IT risk is concerned, because such fail-ble for quantitative management while the Operations

ures may threaten the basic infrastructure of our services toPlanning, the IT Systems & Planning and the Legal Affairs

customers. We are therefore making every effort to ensure

Departments are responsible for qualitative management of

the stability of our IT operations and the protection andeach specific risk. These departments are working closely

safety of informational assets relating to systems.

together to promote various initiatives for the more sophisti-

Following the computer systems problems and operational

cated management of operational risk for the entire group.

confusion that occurred in Japan at the time of the launching

At the four core subsidiaries, these departments are alsoof MHCB and MHBK, we have been doing everything in our

working together in the same structure to manage the oper-

power to minimize IT risk, strengthening our procedures forational risk on a day-to-day basis.

assessing systems development and launches, promoting

We are currently developing a common loss database andseveral quantification models to be used in allocation of risk

standardization of project management, and drawing up
effective contingency plans.

capital for the entire group, under clear understanding that

MHHD's IT & Systems Planning Department monitors IT risk

quantification is a must for the more sophisticated manage-

for the entire group in line with the unified basic policy

ment of operational risk.

drawn up by MHHD as the basis for our IT risk management
69Internal Control Systems of Mizuho

Risk Management Structure of Mizuho

framework. The head of the IT & Systems and Operations

actual settlement amounts, Real-Time Gross Settlements

Group ascertains the sources, scale and nature of IT risk and(RTGS) to minimize the settlement time lag and theafter overall assessment and monitoring, submits reports toContinuous Linked Settlement Bank (CLSB) to cut settlement

MHHD's CEO and other members of top management who

risk.

then address the management issues involved and work to
resolve them.

Reputational Risk Management
Reputational risk is the risk of incurring tangible or intangible

Legal Risk Management

losses as a result of damage caused to the group's credibility

We see legal risk as the risk of incurring tangible or intangibleor the Mizuho brand when market players learn about or thelosses as a result of infringements of laws and regulations,media reports various risk events that actually arise in con-concluding inappropriate contracts, and other legal factors.

nection with the group's operating activities, or false rumors

While deregulation has resulted in considerable progress in

MHHD has drawn up rules for managing information asso-

agements are also required to be fully accountable for theirciated with reputational risk and manages this kind of risk onactions. In this environment, we recognize that legal risk

behalf of the entire group. Each of the four core subsidiaries

management is an issue of key importance for managing thedraws up its own rules for managing information associatedgroup, and the Legal Affairs Department of the Audit andwith reputational risk in line with the holding company's

Compliance Group is responsible for the basic planning andrules, and monitors and manages the sources, scale and sta-administration of legal risk management.

tus of reputational risk.

MHHD has drawn up a basic policy which forms the foun-

When MHHD deems that certain information may have adations for legal risk management throughout the group.

serious impact on group management, it requires the four

Legal risk management takes the form of legal checks in con-core subsidiaries to submit timely reports as appropriate,

nection with management decisions, new products and new

managing the information on an integrated basis and devis-

businesses, as well as centralized management of legal infor-

ing suitable responses to minimize reputational risk.

mation concerning the enactment, revision and abolition oflegislation, as well as identifying and responding to legal risks
such as litigation.
Each of the four core subsidiaries manages legal risk inaccordance with MHHD's basic policy and submits applications and reports concerning prescribed matters to MHHD.
The core subsidiaries also manage legal risk in accordancewith the scale and nature of the legal risk exposures of theirown group companies.

Settlement Risk Management
Settlement risk is the risk of incurring losses because settlements are not executed according to schedule for some reason. It usually encompasses various kinds of risk, including
credit risk, liquidity risk, operations risk and legal risk. In
recent years, moreover, finding international solutions for
Herstatt risk—the risk arising from time zone differences ininternational currency settlements—has attracted a great
deal of attention.
We have adopted various methods for averting different
types of settlement risk. We use netting procedures to reduce70

or vicious slanders.

liberalizing and diversifying the banking business, bank man-

Internal Control Systems of Mizuho

Compliance Structure of Mizuho

Basic Compliance Policy

Compliance Activities

We are acutely conscious of our social responsibilities andFurthermore, to realize the Basic Principles of the

public mission at all times as Japan’s leading comprehensive

Consolidation, we have drawn up the Mizuho Code offinancial services group. We therefore work to ensure that

Conduct, which establishes clear and concrete standards of

we observe all laws and regulations, and pursue corporate

ethical behavior. We have distributed it to all executives andactivities in a fair and honest manner that conforms to theemployees of MHFG, and are doing all we can to ensure that

norms accepted by society.

they are fully acquainted with its contents and act in accor-

Sticking to the three basic principles for compliance listed

dance with them.

below as the basis for our corporate activities throughout theWe have prepared a compliance manual which clarifies thegroup, each group company establishes its own compliancelaws and regulations that each group company must observe

structure in line with the basic policies indicated by MHHD.

in pursuing their business activities and the compliance activi-

1) We shall place thoroughgoing compliance as one of theties they should follow. Each fiscal year, we also draw up afundamental principles of sound business management.

practical compliance program containing concrete measures2) We shall promote a compliance system which will befor ensuring that compliance is thoroughly enforced.

accepted in the global financial and capital markets.
3) We shall gain the favorable regard of our shareholders
and the market, and build on the trust of society through

MHFG's Compliance Structure

rigorous compliance activities.

Compliance Structure

MHHD
Board of Directors
Internal Audit & Compliance Committee

In order to check that our business activities are appropriate(Chairman: President & CEO)in terms of compliance and audits, we have established theHead of Audit and Compliance GroupInternal Audit & Compliance Committee, which is chaired by
the CEO and includes Deputy Presidents and external specialists in legal and accounting matters among its members.

(Compliance Department)

Every organizational unit
Head ofeach unit

Compliance
Administrator

Moreover, we have established the Compliance Department under the head of the Audit and Compliance Group,
who is a deputy president of MHHD. This department is
responsible for compliance planning and implementation,

Four core subsidiaries

and controls compliance management throughout MHFG.
The head of every organizational unit within MHHD is
responsible for guidance and implementation in connection

The group companies ofthe four core subsidiaries

with compliance, while compliance administrators are
deployed to check the status of compliance.
MHHD monitors and manages the status of compliancethroughout the group from reports submitted by the four
core subsidiaries, and adopts appropriate responses whenever necessary. Compliance at group companies of the four
core subsidiaries is monitored and managed through the coresubsidiaries themselves.

71

Internal Control Systems of Mizuho

Internal Audit Structure of Mizuho

Basic Internal Audit Policies
Internal audits are designed to evaluate the appropriateness

MHHD’s Internal Audit Management
Structureand effectiveness of internal control systems from a compre-

Under the management of the head of MHHD's Audit andhensive and objective standpoint, and independently of theCompliance Group, the Internal Audit Department supervises

business divisions. Auditing is an integrated process that

audits for the entire group. More specifically, based on

extends not only to providing remedial advice in connection

reports submitted by the four core subsidiaries, MHHD care-with problems, but also follow-ups to see how the improve-fully examines whether the internal audits they conduct arements are progressing.

appropriate in terms of structure, methodologies and depth,

Through the above integrated process, internal audits ofand whether the internal control systems adopted by the

MHFG are designed to contribute to the achievement andcore subsidiaries for themselves and their own group compa-

maintenance of internal control objectives—appropriate risk

nies are effective. Where necessary, it prepares advice, guid-management, efficient and effective business operations, reli-ance and remedial recommendations for the four coreable financial reporting, and compliance with laws, regula-subsidiaries to act on.

tions and corporate standards—thereby assisting the Boards

The Internal Audit Department also conducts internalof Directors of individual group companies in efficiently andaudits of MHHD, and the results are reported to the Board ofeffectively fulfilling their managerial duties under the self-

Directors after going through the Internal Audit &responsibility principle.

Compliance Committee. This ensures that checks and balances are in place to confirm that the holding company is ful-

MHFG’s Internal Audit Management
Structurefilling its core duties in the area of business management in afair and appropriate manner.

MHHD provides centralized assessment and management of
the execution of internal audits in the four core subsidiaries.

MHFG's Internal Audit Management Structure

The latter have established their own management systems
for internal audits in line with the basic policies laid down by

MHHD

MHHD, as well as management systems for their own group

Board of Directors

companies. They also submit reports to MHHD on the results

President & CEO(of audits and the status of follow-up steps to deal with problems.

Chairman ofInternal Audit& Compliance
Committee)

After the Internal Audit & Compliance Committee discusses the results of internal audits and checks on the internal control systems of the four subsidiaries, as well as

Advice, guidance
and remedialrecommendations

Internal Audit &Compliance Committee

Head of Audit andCompliance Group

important matters pertaining to group internal audits, andreaches decisions thereon, reports are submitted to the Boardof Directors.

(

Department in charge:
Internal Audit Department

Further, in light of the computer systems problems andoperational confusion that occurred in Japan at the time of
the launching of MHCB and MHBK, we are working evenharder to improve the quality of internal audits for the entire
group.

72

Four core subsidiaries)
Report theresults ofinternal audit,
etc.

74

Financial Analysis of Mizuho
Key Indicators of Mizuho Holdings

74

The Financial and Economic Environment

76

Results for the Fiscal Year ended March 31, 2002

78

Disclosure of Asset Quality

88

Overview of the Accounting Entry made throughthe Corporate Split and Merger Process

99

73

Financial Analysis of Mizuho

Key Indicators of Mizuho Holdings

Key Indicators of Consolidated Performance
Billions of yen

For the Fiscal Years ended March 31

2002

2001

¥ 5,315.5(976.0)4,731.4
151,312.4
85,606.2
15,310.8
84,593.6
24,108.9¥ 5,913.7
211.2
6,254.2
163,455.4
80,176.4
17,848.2
92,286.7
28,062.5

295,093.14(108,003.27)—

450,667.56
20,524.13
20,109.99

Risk-based Capital Ratio (BIS Capital Ratio)

10.56%

11.39%Net Return on Equity
PER (Times) (Note 3)(28.8)%—x4.5%
34.34xCash Flows from Operating Activities
Cash Flows from Investing Activities
Cash Flows from Financing Activities

6,776.4
1,530.7(697.4)

2,918.7(3,362.1)(334.7)

Cash and Cash Equivalent at the End of the Year9,847.3

2,219.8

Total Income
Net Income (Loss)
Total Shareholders’ Equity
Total Assets
Deposits
Debentures
Loans and Bills Discounted
Securities
Total Shareholders’ Equity per Share (Yen) (Note 1)
Net Income (Loss) per Share (Yen) (Note 2)
Net Income (Loss) per Share Assuming Dilution (Yen) (Note 3)

Notes: 1. Total Shareholders’ Equity per Share: (Total Shareholders’ Equity – (Shares of Preferred Stock x Issued Value)) / Shares of Common Stock (excluding Treasury Stock).
2. Net Income (Loss) per Share: (Net Income (Loss) – Cash Dividends Declared (Preferred Stock)) / Average Outstanding Shares of Common Stock (excluding Treasury Stock).
3. “Net Income (Loss) per Share Assuming Dilution” and “PER” for the fiscal year ended March 31, 2002 is not required to disclose due to Net Loss.

74

Key Indicators of Non-Consolidated Performance
Billions of yen

For the Fiscal Years ended March 31

2002

2001

¥ 123.0
98.5¥ 114.0
97.7

2,572.0
Common Shares 9,430,250.71 sharesFirst Series Class I Preferred Shares
33,000 shares
Second Series Class II Preferred Shares
100,000 shares
Third Series Class III Preferred Shares
100,000 shares
Fourth Series Class IV Preferred Shares
150,000 shares
Sixth Series Class VI Preferred Shares
150,000 shares
Seventh Series Class VII Preferred Shares
125,000 shares
Eighth Series Class VIII Preferred Shares
125,000 shares
Ninth Series Class IV Preferred Shares
140,000 shares
Tenth Series Class X Preferred Shares
140,000 shares

2,572.0
Common Shares 9,205,856.53 sharesFirst Series Class I Preferred Share
33,000 shares
Second Series Class II Preferred Shares
100,000 shares
Third Series Class III Preferred Shares
100,000 shares
Fourth Series Class IV Preferred Shares
150,000 shares
Fifth Series Class V Preferred Shares
52,411 shares
Sixth Series Class VI Preferred Shares
150,000 shares
Seventh Series Class VII Preferred Shares
125,000 shares
Eighth Series Class VIII Preferred Shares
125,000 shares
Ninth Series Class IV Preferred Shares
140,000 shares
Tenth Series Class X Preferred Shares
140,000 shares
6,561.4
7,412.6

Operating Income
Net Income
Common Stock and Preferred Stock
Number of Shares Issued and Outstanding

Total Shareholders’ Equity
Total Assets
Total Shareholders’ Equity per Share (Yen) (Note 1)
Common Shares
Dividend per Share of Common StockFirst Series Class I Preferred Shares(Interim dividends per share) (Yen) (Note 2)
Second Series Class II Preferred Shares
Third Series Class III Preferred Shares
Fourth Series Class IV Preferred Shares
Fifth Series Class V Preferred Shares
Sixth Series Class VI Preferred Shares
Seventh Series Class VII Preferred Shares
Eighth Series Class VIII Preferred Shares
Ninth Series Class IX Preferred Shares
Tenth Series Class X Preferred Shares
Common SharesFirst Series Class I Preferred Shares
Second Series Class II Preferred Shares
Third Series Class III Preferred Shares
Fourth Series Class IV Preferred Shares
Fifth Series Class V Preferred Shares
Sixth Series Class VI Preferred Shares
Seventh Series Class VII Preferred Shares
Eighth Series Class VIII Preferred Shares
Ninth Series Class IX Preferred Shares
Tenth Series Class X Preferred Shares
Net Income per Share of Common Stock (Yen) (Note 3)
Net Income per Share Assuming Dilution (Yen)PER (Times)
Dividend Propensity (Note 4)

6,616.4
7,467.7
494,962.03
3,500
22,5008,200
14,00047,600—42,00011,0008,000
17,500
5,380
—
—
—
—
—
—
—
—
—
—
—
8,286.55
8,161.61
36.44 x43.09%

Common SharesFirst Series Class I Preferred Shares
Second Series Class II Preferred Shares
Third Series Class III Preferred Shares
Fourth Series Class IV Preferred Shares
Fifth Series Class V Preferred Shares
Sixth Series Class VI Preferred Shares
Seventh Series Class VII Preferred Shares
Eighth Series Class VIII Preferred Shares
Ninth Series Class IX Preferred Shares
Tenth Series Class X Preferred Shares
Common SharesFirst Series Class I Preferred Shares
Second Series Class II Preferred Shares
Third Series Class III Preferred Shares
Fourth Series Class IV Preferred Shares
Fifth Series Class V Preferred Shares
Sixth Series Class VI Preferred Shares
Seventh Series Class VII Preferred Shares
Eighth Series Class VIII Preferred Shares
Ninth Series Class IX Preferred Shares
Tenth Series Class X Preferred Shares

483,949.97
7,000
22,5008,200
14,00047,6007,500
42,00011,0008,000
17,5005,380
3,500
11,2504,100
7,000
23,8003,750
21,000
5,500
4,000
8,750
2,690
9,404.65
9,218.80
74.96x37.21%

Notes: 1. Total Shareholders’ Equity per Share: (Total Shareholders’ Equity – Shares of Preferred Stock x Issued Value) / Shares of Common Stock.
2. With regard to Dividends per Share of Common Stock, “Stock Transfer Payments” were paid to shareholders of common stock of DKB, Fuji Bank and IBJ as of September 27, 2000 instead ofinterim cash dividends for fiscal 2000. The figures mentioned for interim dividends per share comprise said “Stock Transfer Payments.”
3. Net Income per Share: (Net Income – Cash Dividends Declared (Preferred Stock)) / Average Outstanding Shares of Common Stock.
4. Dividend Propensity: Cash Dividends Declared (Common Stock) / (Net Income – Cash Dividends Declared (Preferred Stock)). The Dividend Propensity does not include the abovementioned Stock
Transfer Payments.
5. In computing “Per share infomation,” Share of Common Stock excludes Treasury Stock for the fiscal year ended March 31, 2002.

75

Financial Analysis of Mizuho

The Financial and Economic Environment

The Financial and Economic Environment
The Economic Conditions in Japan and Overseas
Looking at global economic conditions in the fiscal year ended March 31, 2002 ("fiscal 2001"), the U.S. economy was affected by
downward pressures, especially after the simultaneous terrorist attacks on New York and Washington on September 11, 2001.
However, as a result of progress in adjustments centered on the corporate sector, signs of a gradual recovery began to appear. In
Asia, a turnaround in the export environment helped the economy to bottom out, while the economies of Europe also appeared
to be heading towards a gradual recovery. In Japan, however, the economy continued to deteriorate as the impact of a substantial decline in production activity rippled out to employment and incomes. The outlook for the Japanese economy became evenmore uncertain as the decline in capital expenditures was compounded by weak housing investment and sluggish individual consumption.
In light of the economic environment, the Bank of Japan ("BOJ") loosened monetary policy still further in August 2001, andlowered the official discount rate again the following month. Meanwhile, the government demonstrated its determination to pursue structural reforms by announcing its Structural Reform Schedule in September and its Front-Loaded Reform Program in
October. In February 2002, it announced its Countermeasures to Deflation. Although conditions in the Japanese economy
remained severe, these policy responses and the beginnings of a recovery phase in the global economy resulted in signs that the
decline was coming to a halt in certain sectors.

The Financial Markets and the Financial Sector
Looking back at the financial markets in fiscal 2001, yields on long-term Japanese government bonds ("JGBs") remained relatively
stable at around 1.4%. The sluggishness affecting the stock market was extremely severe, but from March 2002, there were signsof a gradual upswing. In the foreign exchange market, the yen weakened against the dollar for a while, falling to around ¥135=
US$1 before experiencing a fairly rapid correction.
Meanwhile, the environment affecting the management of financial institutions remained severe in the face of rising corporatebankruptcies and weakness in the stock market. The government asked the major banks to dispose of their non-performing loans("NPLs") within two to three years, and carried out special inspections. Then, following the passage of legislation restricting stock
holdings by banks, the Banks' Shareholdings Purchase Corporation was established in January 2002. There have been a numberof changes on the financial regulations. The ban on over-the-counter sales of insurance products at banks was lifted in April
2001, defined contribution pension plans were introduced in October 2001, and the ban on bank participation in the trust business was removed in February 2002. Amidst these changes, competition in the financial industry looks set to intensify as newconsolidations and reorganizations take place and the influx of participants from non-financial sectors continues.

76Trends in Interest Rates in Japan
(%)

2.5

Long-Term Prime Rate
2.0

Short-Term Prime Rate
1.5

Newly Issued Government Bond Yield (10-Year)

1.0

0.5

Call Rate (Uncollateralized overnight)
Euroyen TIBOR (3-month)0

Jan. 2001

Apr. 2001

July 2001

Oct. 2001

Jan. 2002

Apr. 2002

Trends in TOPIX and Yen / Dollar Exchange Rate
(Yen / Dollar)(Point)

1,500

140

TOPIX (left scale)

1,400

Yen / Dollar Exchange Rate(right scale)

135

1,300

130

1,200

125

1,100

120

1,000

115

900

Jan. 2000

Apr. 2001

July 2001

Oct. 2001

Jan. 2002

Apr. 2002

110

77

Financial Analysis of Mizuho

Results for the Fiscal Year ended March 31, 2002

Results for the Fiscal Year ended March 31, 2002
Consolidated Accounts
1. Scope of Consolidation and Application of the Equity Method
companies

At March 31

2002

2001

ChangeNumber of consolidated subsidiaries
Number of affiliates accounted for under the equity method

171
30

290
91

(119)
(61)

The number of consolidated subsidiaries of Mizuho Holdings, Inc. ("MHHD") decreased by 119 to 171, and the number of affiliates accounted for under the equity method decreased by 61 to 30 from the end of previous fiscal year. The major consolidated
subsidiaries are The Dai-Ichi Kangyo Bank, Ltd. (“DKB”), The Fuji Bank, Ltd. (“Fuji Bank”), The Industrial Bank of Japan, Ltd.
(“IBJ”) (collectively, “the Three Banks”), Mizuho Securities Co., Ltd. and Mizuho Trust & Banking Co., Ltd. The major affiliates
accounted for by the equity method were The Chiba Kogyo Bank, Ltd. and Shinko Securities Co., Ltd.

2. Consolidated Profits and Losses
Billions of yen

For the Fiscal Years ended March 31

Consolidated Gross Profits
Net Interest Income
Net Fiduciary Income
Net Fee and Commissions Income
Net Trading Income
Net Other Operating Income

2002

¥

2,462.0
1,527.6
54.4
501.0
178.8
199.9

2001

¥

2,149.3
1,353.9
65.1
427.9
156.5
145.8

Change

¥

312.6
173.6
(10.6)
73.1
22.3
54.1

General and Administrative Expenses

1,368.2

1,228.6

139.5

Credit-related Costs

2,487.6851.9

1,635.6

Net Gains related to Stocks and Other Securities

116.7

515.0

(398.3)Equity in Earnings (Losses) from Investment in Affiliates

(6.7)

18.0

(24.8)(141.2)(121.7)(19.4)(1,425.1)

480.0(1,905.2)

OthersIncome (Loss) before Income Taxes and Minority Interests
Income Taxes–Current

110.4

51.6

58.8

Income Taxes–Deferred(545.9)146.3(692.2)

Minority Interests in Net Income (Loss)(13.7)

70.8(84.5)Net Income (Loss)(976.0)211.2(1,187.3)¥ (108,003.27)¥ 20,524.13¥ (128,527.40)

Net Income (Loss) per Share of Common Stock (Yen)

Notes: 1. Consolidated Gross Profits: Net Interest Income + Net Fiduciary Income + Net Fee and Commissions Income + Net Trading Income + Net Other Operating Income.
2. Credit-related Costs = Expenses related to Portfolio Problems + Provision of General Reserve for Possible Losses on Loans.

(1) Consolidated Gross Profits
Consolidated Gross Profits increased by ¥312.6 billion to ¥2,462.0 billion in comparison with the previous fiscal year.
Net Interest Income increased by ¥173.6 billion to ¥1,527.6 billion, as a result of the improvement of money market activities,
and other.
Net Fiduciary Income decreased by ¥10.6 billion to ¥54.4 billion.
Net Fee and Commissions Income rose by ¥73.1 billion to ¥501.0 billion, mainly reflecting the increase in commissions related
to deposits, debentures and lending business.
Because of a rise in profits on derivatives for trading transactions, and other, Net Trading Income increased by ¥22.3 billion to¥178.8 billion.
Net Other Operating Income increased by ¥54.1 billion to ¥199.9 billion.
(2) General and Administrative Expenses
Because of higher expenses associated with the consolidation, General and Administrative Expenses increased by ¥139.5 billion
from the previous fiscal year to ¥1,368.2 billion.

78

(3) Credit-related Costs
In light of the current economic environment and recent trends in corporate performance, final disposals of non-performing loans
were accelerated and the strictest ever self-assessments were carried out. As a result, Credit-related Costs increased by ¥1,635.6
billion to ¥2,487.6 billion.
(4) Net Gains Related to Stocks and Other Securities
Active efforts to unwind cross shareholdings continued, but because of Losses on Devaluation of Stocks and Other Securities
against the background of declining stock prices, Net Gains Related to Stocks and Other Securities decreased by ¥398.3 billion to¥116.7 billion.
(5) Net Income (Loss)
As a result of the above, Loss before Income Taxes and Minority Interests amounted to ¥1,425.1 billion after accounting for
General and Administrative Expenses, Credit-related Costs, and others.
Net Income fell by ¥1,187.3 billion and become Net Loss of ¥976.0 billion after reflecting Income Taxes–Current, Income Taxes–
Deferred and Minority Interests in Net Loss in Loss before Income Taxes and Minority Interests.
Use and Source of Funds
Billions of yen

2002

Yield
2001

Use of Funds
Due from Banks
Call Loans and Bills Purchased
Receivables under Resale Agreements
Securities
Loans and Bills Discounted¥ 130,664.1
3,724.3
1,886.3
3,265.7
30,046.6
88,835.8¥ 129,208.3
3,157.1
3,773.6—
29,571.9
91,543.6¥ 1,455.7
567.2(1,887.3)
3,265.7474.6(2,707.7)

2.31%
2.84
0.88
8.01
1.71
2.31

2.71%
4.36
9.08
—
1.52
2.70

(0.40)%(1.52)(8.20)
8.01
0.19(0.39)

Source of Funds
Deposits
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Commercial Paper
Borrowed Money¥ 126,610.8
81,877.5
16,878.0
8,280.1
7,095.4
1,545.1
3,695.3¥ 121,224.4
76,960.1
19,923.5
12,528.8—
1,424.1
4,216.5¥ 5,386.3
4,917.3(3,045.5)(4,248.6)
7,095.4
121.0(521.1)

1.17%
0.61
1.01
0.39
4.91
1.26
2.54

1.76%
1.06
1.11
3.82
—
2.48
2.77

(0.59)%(0.45)(0.10)(3.43)
4.91(1.22)
0.23

2002

2001

ChangeFee and Commission Income
Deposits, Debentures and Lending Business
Remittance Business
Securities-related BusinessAgency Business
Safe Custody and Safety Deposit Box Business
Guarantee Business
Trust-related Business¥ 544.2
123.7
115.8
85.1
41.1
8.3
39.4
23.8

¥ 513.1
116.3
114.8
78.3
30.6
7.8
29.8
35.9

¥ 31.0
7.3
1.0
6.8
10.4
0.4
9.6
(12.1)

Fee and Commission Expenses
Remittance Business¥ 43.127.5¥ 85.227.7¥ (42.1)(0.1)

For the Fiscal Years ended March 31

Average balance
2002
2001

ChangeChangeNet Fee and Commission Income
Billions of yen

For the Fiscal Years ended March 31

79

Financial Analysis of Mizuho

Results for the Fiscal Year ended March 31, 2002

3. Consolidated Assets and Liabilities
Billions of yen

At March 31

Total Assets
Cash and Due from Banks
Trading Assets
Securities
Loans and Bills Discounted
Other Assets
Customers’ Liabilities for Acceptances and Guarantees

2002

2001

Change¥ 151,312.4
11,720.1
7,951.4
24,108.9
84,593.6
11,067.7
4,923.2¥ 163,455.4
5,011.2
10,877.4
28,062.5
92,286.7
14,940.7
6,129.6¥ (12,143.0)
6,708.9(2,926.0)(3,953.6)(7,693.1)(3,872.9)(1,206.3)

145,629.9
85,606.2
15,310.8
9,453.6
11,278.1

156,449.2
80,176.4
17,848.2
13,208.0
21,186.8(10,819.3)
5,429.7(2,537.3)(3,754.3)(9,908.6)

Total Liabilities
Deposits
Debentures
Call Money and Bills Sold
Other Liabilities
Minority Interests
Shareholders’ Equity

951.0
¥

4,731.4

751.9¥

6,254.2

199.1¥(1,522.8)(1) Assets
Securities decreased by ¥3,953.6 billion from the end of the previous fiscal year to ¥24,108.9 billion. With regard to Other
Unrealized Gains (Losses) on Other Securities (available for sale) at year-end, the downward trend in the stock market resulted inunrealized losses of ¥887.6 billion.
Loans and Bills Discounted at year-end fell by ¥7,693.1 billion to ¥84,593.6 billion. Non-Accrual, Past Due & Restructured Loansamounted to ¥5,467.2 billion, or 6.46% of total Loans and Bills Discounted.
Total Assets came to ¥151,312.4 billion.
(2) Liabilities and Minority Interests
Deposits increased by ¥5,429.7 billion from the end of the previous year to ¥85,606.2 billion.
Minority Interests increased by ¥199.1 billion to ¥951.0 billion.

80

(3) Shareholders’ Equity
Shareholders’ Equity decreased by ¥1,522.8 billion from the end of the previous fiscal year to ¥4,731.4 billion, primarily becauseof the Net Loss posted.
The consolidated Risk-based Capital Ratio (BIS Capital Ratio) stood at 10.56%.
Risk-Based Capital Ratio (BIS Capital Ratio)
Billions of yen

At March 31

2002

2001

ChangeBIS Capital Ratio
Tier I Ratio

10.56%
5.33%

11.39%
5.97%(0.83)%(0.64)%

Tier I
Capital Stock
Capital Surplus
Retained Earnings
Minority Interest in Consolidated Subsidiaries
Preferred Shares issued by overseas SPC
Unrealized Losses on Other Securities
Treasury Stock
Foreign Currency Translation Adjustments
Goodwill Equivalent
Consolidation Differences Equivalent(A)

Tier II
45% of Unrealized Gains on Securities
45% of Revaluation Reserve for Premises
General Reserve for Possible Losses on Loans
Debt Capital
Perpetual Subordinated Debt
Subordinated Debt Redeemable Preferred Shares(B)

Deductions from Capital(C)

Capital(A)+(B)-(C)Risk-adjusted Assets
Assets Exposed to Credit Risk
On-balance-sheet Items
Off-balance-sheet Items
Market Risk Equivalent Divided by 8%(Reference) Market Risk Equivalent¥

5,029.1
2,572.0
2,203.7
46.1
952.6
872.5
(559.6)(1.2)(120.1)(0.0)(64.2)
5,029.1
—
391.3
953.4
3,974.5
1,710.0
2,264.5¥

6,292.6
2,570.1
2,203.7
1,063.8
738.0
468.3
—
/
(175.4)(0.0)(107.7)¥ (1,263.4)
1.8—(1,017.6)
214.5
404.2
(559.6)
(1.2)
55.2
0.0
43.4

5,914.6
—
401.5
780.7
4,732.3
2,026.1
2,706.1(885.5)—(10.2)
172.6(757.8)(316.1)(441.6)

98.3

202.3

(103.9)9,959.9¥ 12,004.9¥ (2,045.0)¥ 94,288.9
93,276.7
85,791.9
7,484.8
1,012.1
80.9¥ 105,317.9
104,190.8
95,630.2
8,560.6
1,127.0
90.1¥ (11,029.0)(10,914.1)(9,838.3)(1,075.7)(114.8)
(9.1)

¥

81

Financial Analysis of Mizuho

Results for the Fiscal Year ended March 31, 2002

Aggregated Figures of the Three Banks
The aggregated figures of the Three Banks are the sum of the non-consolidated results of DKB, Fuji Bank and IBJ.
Since the consolidated financial statements of MHHD are mainly made up of the Three Banks, the following table is prepared
for the reader's information.

1. MHHD Consolidated Figures and Aggregated Figures of the Three Banks
Differences between MHHD Figures and Aggregated Figures of the Three Banks
Billions of yen

For the Fiscal Years ended March 31

Gross Profits
Net Interest Income
Net Fiduciary Income
Net Fee and Commissions Income
Net Trading Income
Net Other Operating Income
Credit-related Costs
Net Income (Loss)
Total Assets
Loans and Bills Discounted
Securities

MHHD(Consolidated)
(A)

2002
AggregatedFigures of theThree Banks (B)(A) – (B)(B) / (A)¥ 2,462.0
1,527.6
54.4
501.0
178.8
199.9

¥ 1,829.9
1,335.2
—
231.6
118.5
144.4

¥ 632.0
192.3
54.4
269.4
60.3
55.5

74.33%
87.41
.—
46.23
66.28
72.21

2,487.6

2,193.9

293.7

88.19

(909.6)(66.4) 93.20(976.0)151,312.4
84,593.6
24,108.9

140,985.9 10,326.4
80,574.3
4,019.3
24,049.0
59.8

93.18
95.25
99.75

2001
MHHD
Aggregated(Consolidated) Figures of the(A) Three Banks (B)(A) – (B)(B) / (A)¥ 2,149.3
1,353.9
65.1
427.9
156.5
145.8

¥ 1,639.4
1,194.8
—
234.7
107.1
102.6

¥ 509.8
159.1
65.1
193.1
49.3
43.1

76.28%
88.25
.—
54.86
68.47
70.41

851.9

693.8

158.1

81.44

202.6

8.6

95.91

148,971.4 14,484.0
85,697.7 6,589.0
27,310.7
751.8

91.14
92.86
97.32

211.2
163,455.4
92,286.7
28,062.5

2. Profits and Losses
Aggregated Net Business Profits for the Three Banks (before General Provision for Possible Losses on Loans) rose by ¥175.2 billion
from the previous year to ¥958.2 billion, primarily because of an increase in Net Interest Income.
While progress was made in unwinding cross shareholdings, Losses on Devaluation of Stocks and Other Securities resulting
from efforts to reflect financial condition of the Three Banks more clearly caused Net losses related to Stocks and Other Securitiesof ¥73.4 billion.
Expenses Related to Portfolio Problems increased by ¥1,284.0 billion to ¥1,979.5 billion in comparison with the previous fiscal
year. The primary reasons for the increase are loan write-offs and increased provisions based on our renewed rigorous self-assessments process as a result of our ongoing efforts to build a robust financial structure and accelerate our disposals of NPLs.
Net Income thus decreased by ¥1,112.2 billion from the previous fiscal year, resulting in Net Loss of ¥909.6 billion.

82

Profits and Losses (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

2002

2001

1,303.7
526.1¥ 1,249.0
390.4

1,829.9
1,335.2
231.6
118.5
144.4
62.7

1,639.4
1,194.8
234.7
107.1
102.6
71.9

190.5
140.4
(3.1)
11.4
41.7
(9.1)

General and Administrative Expenses (Excluding Non-recurring Expenses)

871.7

856.4

15.2

Net Business Profits (before Provision (Reversal) of General Reserve
for Possible Losses on Loans)Excluding Net Gains related to Bonds

958.2
895.4

782.9
711.0

175.2
184.4

214.3

(1.6)

216.0

Domestic Gross Profits
International Gross Profits¥

Gross Profits
Net Interest Income
Net Fee and Commissions Income
Net Trading Income
Net Other Operating Income
Net Gains related to Bonds

Provision (Reversal) of General Reserve for Possible Losses on Loans(A)Net Business Profits
Net Non-recurring Gains (Losses)
Net Gains (Losses) related to Stocks and Other Securities
Expenses related to Portfolio Problems
Others(B)

Income (Loss) before Income Taxes
Income Taxes–Current
Income Taxes–Deferred(Reference) Credit-related Costs(A)+(B)

54.7
135.7

743.8

784.6

(40.7)(2,211.4)(73.4)
1,979.5(158.4)(469.2)
321.5
695.5(95.3)(1,742.1)(395.0)1,284.0(63.0)(1,467.6)

315.3(1,782.9)

3.5

23.0

(19.5)(561.4)Net Income (Loss)

Change¥89.6(651.1)¥(909.6)¥202.6¥ (1,112.2)¥

2,193.9

¥

693.8

¥

1,500.0

 Gross Profits
Gross Profits increased by ¥190.5 billion to ¥1,829.9 billion in comparison with the previous year, primarily due to an increase of¥140.4 billion in Net Interest Income.
Breakdown of Gross Profits (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

2002

2001

Change¥ 1,335.2
1,108.2
226.9¥1,194.8
1,064.5
130.2¥ 140.4
43.7
96.7

Net Fee and Commissions Income
Domestic Operations
International Operations

231.6
156.6
75.0

234.7
156.7
78.0

(3.1)
(0.0)
(3.0)

Net Trading Income
Domestic Operations
International Operations

118.5
34.5
84.0

107.1
7.0
100.1

11.4
27.4
(16.0)Net Other Operating Income
Domestic Operations
International Operations

144.4
4.2
140.1

102.6
20.6
81.9

41.7
(16.3)
58.1¥1,829.9¥1,639.4¥ 190.5

Net Interest Income
Domestic Operations
International Operations

Gross Profits

83

Financial Analysis of Mizuho

Results for the Fiscal Year ended March 31, 2002

(1) Net Interest Income
Because of a decline in market-related funding costs, Net Interest income increased by ¥140.4 billion from the previous fiscal yearto ¥1,335.2 billion. Income from domestic operations rose by ¥43.7 billion to ¥1,108.2 billion, and the contribution from international operations increased by ¥96.7 billion to ¥226.9 billion.
Breakdown of Investment Balance (Aggregated Figures of the Three Banks)
Billions of yen

Change

2002

Yield
2001

¥ 116,061.9
84,440.4
24,685.7¥ 2,429.2(1,688.3)
2,042.4

2.02%
2.08
1.84

2.44%
2.49
1.78

(0.42)%(0.41)
0.06

115,585.4
95,123.3

109,997.2
92,504.3

5,588.1
2,618.9

0.91
0.65

1.49
1.07

(0.58)(0.42)

Interest Margins

/

/

/

1.11

0.95

0.16

Loan and Deposit Rate Margin(including Expenses)

/

/

/

1.43

1.42

0.01

Domestic Operations
Use of Funds
Loans and Bills Discounted
Securities

96,404.9
70,154.7
20,822.1

95,008.9
71,981.3
20,023.0

1,396.0(1,826.5)
799.1

1.47
1.68
0.94

1.67
1.86
0.95

(0.20)(0.18)(0.01)

Source of Funds
Deposits and Debentures

95,315.9
80,773.8

90,041.2
78,349.8

5,274.6
2,424.0

0.32
0.28

0.58
0.44

(0.26)(0.16)

Interest Margins

/

/

/

1.15

1.09

0.06

Loan and Deposit Rate Margin(including Expenses)

For the Fiscal Years ended March 31

2002

Total
Use of Funds
Loans and Bills Discounted
Securities¥ 118,491.2
82,752.1
26,728.1

Source of Funds
Deposits and Debentures

Average balance
2001

Change

/

/

/

1.40

1.42

(0.02)

International Operations
Use of Funds
Loans and Bills Discounted
Securities

24,710.9
12,597.3
5,906.0

22,781.2
12,459.1
4,662.6

1,929.6
138.2
1,243.3

4.10
4.30
5.03

5.90
6.10
5.32

(1.80)(1.80)(0.29)

Source of Funds
Deposits and Debentures

22,894.1
14,349.4

21,684.2
14,154.5

1,209.9
194.8

3.43
2.74

5.60
4.57

(2.17)(1.83)

Interest Margins

/

/

/

0.67

0.30

0.37

Loan and Deposit Rate Margin(including Expenses)

/

/

/

1.56

1.53

0.03

(2) Net Fee and Commissions Income
Net Fee and Commissions Income decreased by ¥3.1 billion to ¥231.6 billion.
Breakdown of Net Fee and Commissions Income (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

Fee and Commissions Income
Deposits, Debentures and Lending Business
Remittance Business
Securities-related BusinessAgency Business
Safe Custody and Safety Deposit Box Business
Guarantee BusinessFee and Commissions Expenses
Remittance Business

84

2002

2001

Change¥ 333.3
95.5
114.5
28.6
27.7
6.5
22.8

¥ 329.8
86.7
113.7
29.2
27.3
6.4
20.7

¥ 3.4
8.7
0.8
(0.6)
0.3
0.1
2.1

101.6
28.7

95.0
29.0

6.5
(0.2)

(3) Net Trading Income
Net Trading Income increased by ¥11.4 billion from the previous year to ¥118.5 billion.
(4) Net Other Operating Income
Net Other Operating Income increased by ¥41.7 billion to ¥144.4 billion due to higher Profits on Foreign Exchange Transactions.
Breakdown of Net Other Operating Income (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

Total
Profits on Foreign Exchange Transactions
Net Gains related to Bonds
Domestic Operations
Net Gains related to Bonds
International Operations
Profits on Foreign Exchange Transactions
Net Gains related to Bonds

2002

2001

Change¥ 144.4
91.1
62.7¥ 102.6
29.7
71.9¥ 41.7
61.4
(9.1)

4.2
4.7

20.6
12.6

(16.3)
(7.8)

140.1
91.1
58.0

81.9
29.7
59.3

58.1
61.4
(1.3)

 General and Administrative Expenses
Despite ongoing efforts to improve general management and increase efficiency, General and Administrative Expenses increasedby ¥15.2 billion from the previous year to ¥871.7 billion as a result of higher Non-personnel Expenses relating to the consolidation.
Personnel Expenses decreased by ¥7.5 billion to ¥345.2 billion, primarily reflecting a reduction in the number of personnel
resulting from the restructuring process.
Non-personnel Expenses increased by ¥20.7 billion to ¥479.6 billion, partly because of cost increases relating to the consolidation and deposit insurance premiums.

Breakdown of General and Administrative Expenses (Excluding Non-Recurring Expenses)(Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

2002

2001

ChangePersonnel Expenses
Salaries and Remuneration¥ 345.2
276.4¥ 352.8
278.2¥ (7.5)(1.7)

Non-personnel Expenses

479.6

458.9

20.7

Miscellaneous Taxes
Total

46.7

44.6

2.1

¥ 871.7¥ 856.4¥ 15.2

 Net Business Profits
Net Business Profits (before General Provision for Possible Losses on Loans) increased by ¥175.2 billion from the previous year to¥958.2 billion.
By business segment, profit from the Wholesale segment increased by ¥49.6 to ¥478.0 billion, while profit from the ALM and
Trading segment increased by ¥145.2 billion.
Net Business Profits by Business Segment (before Provision of General Reserve for Possible Losses on Loans)(Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

Net Business Profits (before Provision (Reversal) of
General Reserve for Possible Losses on Loans)
Retail and Middle Market Business
Wholesale
Securities / Investment Banking / Trust / Asset Management,
e-Business / Global Transaction Services
ALM and Trading

2002

2001

Change¥ 958.2
205.3
478.0

¥ 782.9
216.2
428.4

¥ 175.2(10.9)
49.6

(1.2)
298.3

31.8
153.1

(33.0)
145.2

85

Financial Analysis of Mizuho

Results for the Fiscal Year ended March 31, 2002

 Net Non-Recurring Gains (Losses) and Net Income (Loss)(1) Net Gains (Losses) related to Stocks and Other Securities
The Three Banks continued efforts to sell off stocks in line with the policies of reducing stock holding portfolios in order toimprove the efficiency of asset investments and avert from price fluctuation risk. Therefore ¥335.4 billion in Losses on Devaluationof Stocks and Other Securities resulted from efforts to reflect financial condition of the Three Banks more clearly, caused to record
Net Losses relating to Stocks and Other Securities of ¥73.4 billion.
(2) Expenses related to Portfolio Problems
Judging that it was essential to reflect the quality of assets more clearly on the financial statements as soon as possible andimprove market credibility, management took drastic steps to apply more rigorous self-assessments and accelerated final disposalsof NPLs which boosted Expenses related to Portfolio Problems by ¥1,284.0 billion to a total of ¥1,979.5 billion.
Expenses related to Portfolio Problems primarily consisted of Write-Offs of Claims of ¥1,083.2 billion and Provision of SpecificReserve for Possible Losses on Loans of ¥608.6 billion.
Breakdown of Net Non-Recurring Gains (Losses) (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

2002

2001

ChangeNet Gains (Losses) related to Stocks and Other Securities
Gains on Sales of Stocks and Other Securities
Losses on Sales of Stocks and Other Securities
Losses on Devaluation of Stocks and Other Securities
Provision of Reserves for Possible Losses on Securities
Gains (Losses) on Derivatives other than for Trading¥ (73.4)
299.7(38.8)(335.4)(0.0)
1.0¥ 321.5
578.0(46.6)(130.7)(77.6)(1.4)¥ (395.0)(278.3)7.8(204.7)
77.6
2.4

Expenses related to Portfolio Problems
Write-offs of Claims
Provision of Specific Reserve for Possible Losses on Loans
Losses on Sales of Loans to CCPC
Provision of Reserve for Possible Losses on Loans Sold
Losses on Support of Specific Borrowers
Provision of Reserve for Possible Losses on Support of Specific Borrowers
Provision of Reserve for Possible Losses on Loans to Restructuring Countries
Other Losses on Sales of Loans

1,979.5
1,083.2
608.6
54.9
15.9
144.2
17.2
5.2
49.9

695.5
266.7
241.9
34.0
52.0
23.2
59.7
(2.5)
20.4

1,284.0
816.5
366.7
20.9
(36.0)
120.9(42.4)
7.8
29.5

Others(158.4)(95.3)(63.0)¥ (2,211.4)¥ (469.2)¥ (1,742.1)

Net Non-recurring Losses(3) Income Taxes
Income Taxes - Current amounted to ¥3.5 billion, and Income Taxes – Deferred amounted to ¥(561.4) billion.
(4) Net Income (Loss)Net Income thus decreased by ¥1,112.2 billion from the previous fiscal year, resulting in a Net Loss of ¥909.6 billion.

86

3. Assets and Liabilities
Assets and Liabilities (Aggregated Figures of the Three Banks)
Billions of yen

At March 31

Total Assets
Cash and Due from Banks
Trading Assets
Securities
Loans and Bills Discounted
Other Assets
Customers’ Liabilities for Acceptances and Guarantees
Total Liabilities
Deposits
Debentures
Call Money
Other Liabilities
Acceptances and Guarantees
Shareholders’ Equity

2002

2001

Change¥ 140,985.9
11,385.9
5,347.4
24,049.0
80,574.3
8,852.9
6,391.8¥ 148,971.4
4,847.2
8,314.7
27,310.7
85,697.7
11,239.9
7,941.4¥ (7,985.4)
6,538.6(2,967.2)(3,261.7)(5,123.3)(2,386.9)(1,549.6)

135,908.1
82,484.9
15,805.5
7,437.0
8,907.8
6,391.8

142,356.8
75,923.6
18,395.8
10,208.9
16,420.2
7,941.4(6,448.6)
6,561.2(2,590.2)(2,771.9)(7,512.3)(1,549.6)

5,077.7

6,614.5(1,536.7)(1) Assets
Total Assets decreased by ¥7,985.4 billion from the end of the previous fiscal year to ¥140,985.9 billion.
Securities decreased by ¥3,261.7 billion to ¥24,049.0 billion. This resulted primarily from adopting the mark-to-market methodof accounting for Other Securities, effective in the current year, and from a reduction in stock portfolios. With regard to
Unrealized Gains (Losses) on Other Securities at year-end, the downward trend in the stock market resulted in an increase of
unrealized losses of ¥861.2 billion.
In addition to efforts to reduce interest-bearing debt centered on large enterprises, progress in disposing of NPLs meant that
overall Loans and Bills Discounted fell by ¥5,123.3 billion from the previous year-end to ¥80,574.3 billion. Non-Accrual, Past Due
and Restructured Loans amounted to ¥4,907.8 billion, or 6.09% of total Loans and Bills Discounted.
(2) Liabilities
Total Liabilities decreased by ¥6,448.6 billion from the end of the previous fiscal year to ¥135,908.1 billion.
Because of a rise in ordinary and other short-term deposits in advance of the partial introduction of the deposit insurance cap,
total deposits increased by ¥6,561.2 billion to ¥82,484.9 billion in comparison with the end of the previous fiscal year.
Debentures decreased by ¥2,590.2 billion to ¥15,805.5 billion.
(3) Shareholders’ Equity
Shareholders’ Equity decreased by ¥1,536.7 billion from the end of the previous year to ¥5,077.7 billion, primarily because
Retained Earnings declined as a result of the Net Loss.

87

Financial Analysis of Mizuho

Disclosure of Asset Quality

Disclosure of Asset Quality
The aggregated figures of the Three Banks are made up of the sum of the non-consolidated results of DKB, Fuji Bank and IBJ.

Disposal of Problem Loans
Reflecting the harsh economic environment and recent corporate results during the fiscal year ended March 31, 2002, the Three
Banks increased the stringency of their self-assessments and pushed ahead with final disposals of problem loans. During the second half in particular, they strengthened their responses to specific entities by taking into account the industrial sector, stock priceand rating, while making every effort to accelerate final disposals in line with the government's Emergency Economic Policy
Package. As a result, the Three Banks posted aggregated Credit-related Costs of ¥2,193.9 billion.
Credit-related Costs (Aggregated Figures of the Three Banks)
Billions of yen

For the Fiscal Years ended March 31

Credit-related Costs
Expenses related to Portfolio Problems
Write-offs of Claims
Provision of Specific Reserve for Possible Losses on Loans
Losses on Sales of Loans to CCPC
Provision of Reserve for Possible Losses on Loans Sold
Losses on Support of Specific Borrowers
Provision of Reserve for Possible Losses on Support of Specific Borrowers
Provision (Reversal) of Reserve for Possible Losses on Loans to Restructuring Countries
Other Losses on Sales of Loans
Provision (Reversal) of General Reserve for Possible Losses on Loans

2002

2001

Change¥ 2,193.9
1,979.5
1,083.2
608.6
54.9
15.9
144.2
17.2
5.2
49.9
214.3

¥ 693.8
695.5
266.7
241.9
34.0
52.0
23.2
59.7
(2.5)
20.4
(1.6)

¥ 1,500.0
1,284.0
816.5
366.7
20.9
(36.0)
120.9(42.4)
7.8
29.5
216.0

Overview of Disclosure of Problem Loans (Aggregated Figures of the Three Banks) at March 31, 2002
Billions of yen

1. Self-Assessment
Categorization
ObligorCategory I Category II(Non-Categorization)

Category IV
Category III(Non-Collateralized)

1,060.3
Bankrupt and Substantially
Bankrupt Obligors
1,060.3

Watch Obligors

Intensive Control
Obligors
2,030.1

Claims for Special
Attention
1,933.2

Covered by Reserves,
Good Quality Collateralor Guarantees

Reserve
Ratio
100%

DirectWrite-offs

2. Disclosed Claims
under the FRL

Claims against Bankrupt
and Substantially Bankrupt
Obligors 1,060.3

3. Non-Accrual, Past
Due & Restructured
Loans
Loans to Bankrupt Obligors
583.8

Coverage Ratio 100%

1,644.4

385.6

Covered by Reserves,
Good Quality Collateralor Guarantees

Reserve
Ratio
63.9%

Claims with Collection Risk
2,030.1
Coverage Ratio 81.0%

115.9 (Note 2)

Claims for Special Attention(Note 1) 1,933.2

Reserve Ratio for
Uncoverd Portion
20.4%

Non-Accrual
Delinquent Loans
2,390.6

Coverage Ratio 43.5%

Loans Past Due for 3 Months
or More 67.7
Restructured Loans
1,865.5(Special Attention Obligors)
Other Watch Obligors
Normal Obligors

Total
92,520.9

Reserved based on
estimated credit losses

Aggregate Coverage
Ratio 70.6%

Total
5,023.7

Total
4,907.8

Notes: 1. Claims for Special Attention includes loans only and is equal to the total amount of Loans Past Due for 3 Months or More and Restructured Loans.
Claims for Special Attention includes all claims, not limited to loans, against Special Attention Obligors.
2. The difference between total Non-Accrual, Past Due & Restructuring Loans and total Disclosed Claims under the FRL represents claims other than loans included in Disclosed Claims under the FRL.
3. FRL: Financial Reconstruction Law (described on page 91)

88

Self-Assessment, Write-Offs and Provisions“Self-assessments” relate to the procedures carried out by banks to enable them to prepare financial statements that reflect theactual quality of their assets by ascertaining the status of these assets in preparation for making the appropriate write-offs andprovisions based on generally accepted accounting principles.
Specifically, the borrowers are categorized into five obligor classifications according to creditworthiness, then assets are classified into four categories according to asset recovery risk and risk of impairment (for details, please refer to the Definitions of
Obligor Classifications and Definitions of Categories described on page 90).
As a rule, write-offs and provisions are made according to obligor classifications and asset categories on the basis of self-assessment results. The method of write-offs and provisions for the fiscal year ended March 31, 2002 is described below.

Normal Obligors
Appropriate the expected amount of losses over a year computed based on the expected loss ratio for General Reserve for
Possible Losses on Loans.
Watch Obligors
Appropriate the expected amount of losses over three years computed based on the expected loss ratio for General Reserve
for Possible Losses on Loans. As for any claims against obligors having Loans Past Due for 3 Months or More and/or
Restructured Loans, appropriate the projected balance after deduction of the anticipated proceeds from the sale of collateral pledged against the claims and/or the anticipated amount recoverable from the guarantors of the claims for General
Reserve for Possible Losses on Loans.
Intensive Control Obligors
Appropriate, either of the amounts calculated in (1) or (2) below and after the deduction of the anticipated proceeds fromthe sale of collateral pledged against the claims and/or the anticipated amount recoverable from the guarantors of theclaims.
(1) An amount based on a comprehensive evaluation of the obligor's ability to pay.
(2) An amount determined by multiplying the aforementioned balance by the expected loss ratio for the next three years.
Substantially Bankrupt Obligors
Appropriate the amounts for Specific Reserve for Possible Losses on Loans or write-offs:
the entire balance after deduction of the anticipated amount from the sale of collateral pledged against the claims
and/or the anticipated amount recoverable from the guarantors of the claims.
Bankrupt Obligors
Appropriate the following amount for Specific Reserve for Possible Losses on Loans or write-offs are based on the following:
the entire balance after deduction of the anticipated amount from the sale of collateral pledged against the claims
and/or the anticipated amount recoverable from the guarantors of the claims.
The results of write-offs and reserve provisions of the Three Banks for the fiscal year ended March 31, 2002 are described on
page 88.

89

Financial Analysis of Mizuho

Disclosure of Asset Quality

Definition of Obligor Classifications
The first step in making self-assessments is to categorize borrowers into the following five obligor classifications according totheir financial and business conditions.
Normal Obligors
Obligors whose business conditions are favorable and who are deemed not to have any particular problems in terms of
their financial position
Watch Obligors
Obligors who require close watching going forward because there are problems with their borrowings, such as reduced orsuspended interest payments, problems with fulfillment such as de facto postponements of principal or interest payments,
or problems with their financial positions as a result of their poor or unstable business conditions.
Intensive Control Obligors
Obligors who are not yet bankrupt but are in financial difficulties and are deemed to be very likely to go bankrupt in the
future because they are finding it difficult to make progress in implementing their management improvement plans (including obligors who are receiving ongoing support from financial institutions).
Substantially Bankrupt Obligors
Obligors who have not yet gone legally or formally bankrupt but who are substantially bankrupt because they are in serious
financial difficulties and are not deemed to be capable of restructuring.
Bankrupt Obligors
Obligors who have already gone bankrupt, from both a legal and/or formal perspective.
Definition of Asset Categories
Assets are evaluated according to the likelihood that they will be collectible, based on the collateral and guarantees for eachobligor classification, and graded into the following four categories in ascending order according to asset recovery risk.
Category I (Non-Categorized)
All credit given to Normal Obligors, and credit to borrowers in other classifications which have pledged collateral or are covered by guarantees, considered of high quality, such as deposit collateral.
Category II
Credit given to Watch Obligors other than those included in Category I, and Intensive Control Obligors, Bankrupt andSubstantially Bankrupt Obligors which are covered by general collateral, such as real estate and guarantees.
Category III
Credit given to Intensive Control Obligors other than those included in Category I and Category II, the difference between
the assessed value and market value of collateral on credit to Bankrupt and Substantially Bankrupt Obligors (i.e., the portionof loans for which final collection problems or losses are anticipated), and the portion of credit equivalent to the amount ofdebt forgiveness or other form of support scheduled to be provided to Special Attention Obligors who have drawn up management improvement plans on the assumption that support will be forthcoming from financial institutions, etc., in theform of debt forgiveness, etc. (amounts to be included in the accounts in the next or subsequent fiscal years).
Category IV (Non-Collateralized)
Credit to Bankrupt and Substantially Bankrupt Obligors, other than those in Category I, Category II and Category III (credit
that is judged to be unrecoverable or without value).

90

Non-Accrual, Past Due & Restructured Loans
Non-Accrual, Past Due & Restructured Loans are disclosed under the provisions of the Banking Law of Japan and refer collectively
to Loans to Bankrupt Obligors, Non-Accrual Delinquent Loans, Loans Past Due for 3 Months or More and Restructured Loans.
They are based on the obligor classifications used for self-assessments as follows: loans to Bankrupt Obligors are disclosed as
Loans to Bankrupt Obligors, loans to Substantially Bankrupt Obligors and Intensive Control Obligors are disclosed as Non-Accrual
Delinquent Loans, and loans to Watch Obligors that meet certain conditions are disclosed as Loans Past Due for 3 Months orMore or Restructured Loans.
On a consolidated basis, Non-Accrual, Past Due & Restructured Loans amounted to ¥5,467.2 billion as of March 31, 2002. On
the basis of the aggregated figures for the Three Banks, they increased by ¥813.6 billion to ¥4,907.8 billion, but have declined by¥567.9 billion over the last six months.

Claims Disclosed under the Financial Reconstruction Law
Based on the provisions of the Financial Reconstruction Law (“FRL”), Claims Disclosed under the FRL are classified as Claims
against Bankrupt and Substantially Bankrupt Obligors, Claims with Collection Risk and Claims for Special Attention.
They are based on the obligor classifications used for self-assessments as follows: claims on Bankrupt and Substantially Bankrupt
Obligors are disclosed as Claims against Bankrupt and Substantially Bankrupt Obligors, claims on Intensive Control Obligors arepresented as Claims with Collection Risk, and among those claims on Watch Obligors, amounts equivalent to Loans Past Due for
3 Months or More and Restructured Loans under Non-Accrual, Past Due and Restructured Loans are disclosed as Claims forSpecial Attention.
On the basis of the aggregated figures for the Three Banks, the balance of Claims Disclosed under the FRL as of March 31,
2002 increased by ¥828.0 billion to ¥5,023.7 billion, but has fallen by ¥554.3 billion over the last six months. Of this total, Claims
against Bankrupt and Substantially Bankrupt Obligors came to ¥1,060.3 billion, Claims with Collection Risk to ¥2,030.1 billion,
and Claims for Special Attention to ¥1,933.2 billion.
The difference of ¥115.9 billion between the total Non-Accrual, Past Due and Restructured Loans and the total Claims Disclosed
under the FRL represents claims other than loans included in Claims Disclosed under the FRL.
We believe MHHD has ample coverage against the above claims in the form of reserves, collateral and guarantees. Coverage
ratios at the end of March 2002 stood at 100% for Claims against Bankrupt and Substantially Bankrupt Obligors, 81.0% for
Claims with Collection Risk, 43.5% for Claims for Special Attention, and 70.6% overall.

Results of Removal of Problem Loans
Under the government's Emergency Economic Policy Package, major banks are required to remove existing Claims against
Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk (under the FRL) from their balance sheets within
two years. Half of any such new claims should be removed within one year, 80% within two years, and 100% within three years.
Therefore, various disposal measures were adopted by the Three Banks, including legal procedures such as liquidation andrestructuring, collections associated with support for corporate rehabilitation, and efforts to improve business conditions andsecuritization. As a result, disposals proceeded at a faster pace than that required by the government. On the basis of aggregatedfigures of the Three Banks, results of removal as of March 31,2002 were as follows, existing loans (up to and including the firsthalf of fiscal 2000): cumulative total ¥1,652.7 billion (progress rate 67.0%); second half of fiscal 2000: ¥362.3 billion (53.8%);
and first half of fiscal 2001: ¥416.8 billion (35.1%).

91

Financial Analysis of Mizuho

Disclosure of Asset Quality

Status of Non-Accrual, Past Due & Restructured Loans (Consolidated)
Non-Accrual, Past Due & Restructured Loans (After Direct Write-offs of Category IV Loans)
Billions of yen

At March 31

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans
Total

2002

2001

Change470.0
2,169.6
124.8
1,791.7¥ 169.2
528.8(55.0)
267.8¥ 5,467.2¥ 4,556.2¥ 910.9

2002

2001

Change¥ 2,925.4¥ 2,735.6¥ 189.8¥

639.2
2,698.5
69.7
2,059.6¥

Note:

Billions of yen

At March 31

Amount of Direct Write-offs

Ratio to Total Loans (Balance as of March 31, 2002 and 2001) (After Direct Write-offs of Category IV Loans)
At March 31

2002

2001

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans

0.76%
3.19
0.08
2.43

0.51%
2.35
0.14
1.94

0.25%
0.84
(0.06)
0.49

6.46%

4.94%

1.52%

2002

2001

ChangeReserve for Possible Losses on Loans(After Direct Write-offs of Category IV Loans)
General Reserve for Possible Losses on Loans
Specific Reserve for Possible Losses on Loans
Reserve for Possible Losses on Loans to Restructuring Countries¥ 1,949.8
953.4
962.4
34.0

¥ 1,627.6
780.7
817.9
28.9

¥ 322.1
172.6
144.4
5.0

Reserve for Possible Losses on Support of Specific Borrowers

—

159.6

(159.6)

49.6

199.0

Non-Accrual, Past Due & Restructured Loans / Total Loans(at March 31, 2002 and 2001)

ChangeStatus of Loan Loss Reserves
Billions of yen

At March 31

Reserve for Possible Losses on Loans Sold
Note:(149.4)
Billions of yen

At March 31

Amount of Direct Write-offs (Specific Reserve for Possible Losses on Loans)

2002

2001

Change¥ 3,040.0¥ 2,838.0¥ 202.0

Reserve Ratios for Non-Accrual, Past Due & Restructured Loans
At March 31

2002

2001

ChangeBefore Direct Write-offs of Category IV Loans
After Direct Write-offs of Category IV Loans

59.46%
35.66

63.43%
39.23(3.97)%(3.57)

Note: Reserve ratio: (Reserve for Possible Losses on Loans + Reserve for Possible Losses on Support of Specific Borrowers) / Total Non-Accrual, Past Due & Restructured Loans.

92Status of Non-Accrual, Past Due & Restructured Loans (Aggregated Figures of the Three Banks)
Non-Accrual, Past Due & Restructured Loans (After Direct Write-offs of Category IV Loans)
Billions of yen

At March 31

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans
Total

2002

2001

Change427.6
1,889.7
137.2
1,639.4¥ 156.2
500.9(69.5)
226.0¥ 4,907.8¥ 4,094.1¥ 813.6

2002

2001

¥ 2,414.9¥ 2,125.3¥

583.8
2,390.6
67.7
1,865.5¥

Note:

Billions of yen

At March 31

Amount of Direct Write-offs

Change¥289.6

Ratio to Total Loans (Balance at March 31, 2002 and 2001) (After Direct Write-offs of Category IV Loans)
At March 31

2002

2001

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans

0.72%
2.96
0.08
2.31

0.50%
2.21
0.16
1.91

0.22%
0.75
(0.08)
0.40

6.09%

4.78%

1.31%

2002

2001

ChangeReserve for Possible Losses on Loans(After Direct Write-offs of Category IV Loans)
General Reserve for Possible Losses on Loans
Specific Reserve for Possible Losses on Loans
Reserve for Possible Losses on Loans to Restructuring Countries¥ 1,689.5
788.6
869.3
31.5

¥ 1,339.7
553.8
760.0
25.8

¥ 349.7
234.7
109.3
5.6

Reserve for Possible Losses on Support of Specific Borrowers

32.4

176.7

(144.3)

Reserve for Possible Losses on Loans Sold

48.2

195.3

(147.1)Loans to CCPC

82.3

311.8

(229.4)

2002

2001

Change¥ 2,519.3¥ 2,202.9¥ 316.4

ChangeNon-Accrual, Past Due & Restructured Loans / Total Loans(at March 31, 2002 and 2001)

ChangeStatus of Loan Loss Reserves
Billions of yen

At March 31

Notes: 1.

At March 31

Amount of Direct Write-offs (Specific Reserve for Possible Losses on Loans)

Billions of yen

2. CCPC: Cooperative Credit Purchasing Company, Ltd.

Reserve Ratios for Non-Accrual, Past Due & Restructured Loans
At March 31

2002

2001

Before Direct Write-offs of Category IV Loans
After Direct Write-offs of Category IV Loans

57.92%
35.09

59.80%
37.04(1.88)%(1.95)

Note: Reserve ratio: (Reserve for Possible Losses on Loans + Reserve for Possible Losses on Support of Specific Borrowers) / Total Non-Accrual, Past Due & Restructured Loans.

93Financial Analysis of Mizuho

Disclosure of Asset Quality

Status of Disclosed Claims under the FRL (Aggregated Figures of the Three Banks)
Disclosed Claims under the FRL (After Direct Write-offs of Category IV Loans)
Billions of yen

At March 31

Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

2002¥ 1,060.3
2,030.1
1,933.2

2001

¥

805.9
1,613.0
1,776.7

Change

¥

254.4
417.1
156.5

Subtotal

5,023.7

4,195.6

828.0

Normal Claims

87,497.1

93,709.1(6,211.9)¥ 92,520.9¥ 97,904.8¥ (5,383.8)

2002

2001

¥ 2,519.3¥ 2,202.9

2002

2001

¥ 3,546.4
1,061.2
32.4
2,452.7¥ 3,077.1
879.5
176.4
2,021.1

Total
Note:

Billions of yen

At March 31

Amount of Direct Write-offs

Change¥316.4

Status of Coverage on Disclosed Claims under the FRL
Billions of yen

At March 31

Coverage AmountReserve for Possible Losses on Loans
Reserve for Possible Losses on Support of Specific Borrowers
Collateral and Guarantees

94

Change

¥

469.3
181.7
(144.0)431.5

Coverage Ratio (after Direct Write-offs of Category IV Loans)
Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention
Coverage Ratio (before Direct Write-offs of Category IV Loans)

70.6%
100.0
81.0
43.5
80.4

73.3%
100.0
85.4
50.3
82.5

(2.7)%
—
(4.4)
(6.8)
(2.1)

Reserve Ratio against Non-collateralized Claims
Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention

100.0%
63.9
20.4

100.0%
72.7
27.9

—%
(8.8)
(7.5)

Reserve Ratio against Other Claims
Claims against Watch Obligors excluding Claims for Special Attention
Normal Claims

4.56%
0.16

3.94%
0.10

0.62%
0.06

Status of Loans by Industry
Outstanding Loans by Industry (Aggregated Figures of the Three Banks)
Billions of yen

At March 31

Domestic Offices (excluding loans booked at offshore markets)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Transportation & Communication
Wholesale, Retail & Restaurant
Finance & Insurance
Real Estate
Services
Local Government
OthersOverseas Offices and loans booked at offshore markets
Governments
Financial Institutions
Others
Total

2002

2001

Change¥ 71,102.8
11,173.4
74.3
3.3
59.0
82.0
2,552.3
1,226.1
3,803.1
10,365.4
8,939.5
8,016.8
10,866.5
241.5
13,699.0¥ 75,203.8
11,491.7
106.7
3.9
59.9
82.8
2,912.4
1,729.9
4,461.4
11,057.5
9,469.3
8,122.3
11,752.9
257.0
13,695.5¥ (4,101.0)(318.3)(32.4)
(0.6)
(0.8)
(0.7)
(360.0)(503.7)(658.2)(692.1)(529.8)(105.4)(886.4)(15.5)
3.4

9,471.4435.4
391.0
8,644.9

10,493.8
436.9
549.9
9,506.8(1,022.3)(1.5)(158.9)(861.8)¥ 80,574.3¥ 85,697.7¥ (5,123.3)

Non-Accrual, Past Due & Restructured Loans and Disclosed Claims under the FRL by Industry(Aggregated Figures of the Three Banks)
Billions of yen

2002

2001
Non-Accrual,
Past Due &Disclosed
Restructured
ClaimsLoansunder the FRLAt March 31

Non-Accrual,
Past Due &Restructured
Loans

Disclosed
Claimsunder the FRL

Coverageon Disclosed
Claimunder the FRL

Domestic Offices(excluding loans booked at offshore markets)
Manufacturing
Agriculture
Forestry
Fishery
MiningConstruction
Utilities
Transportation & Communication
Wholesale, Retail & Restaurant
Finance & Insurance
Real Estate
Services
Local Government
Others¥ 4,488.3
429.8
2.8
0.4
0.2
0.5
380.6
10.3
76.1
933.3
408.1
1,159.6
756.3
0.3
329.4

¥ 4,551.0
450.3
2.8
0.4
0.2
0.5
398.2
11.2
76.4
938.2
408.3
1,160.7
771.9
0.3
330.9

71.4 %
69.6
85.2
75.8
79.1
66.1
61.7
88.6
65.1
74.1
70.6
74.5
68.3
44.5
89.0

¥3,745.4
206.8
21.3
0.1
0.4
1.8
492.6
2.1
47.5
556.6
303.4
1,031.8
781.2
—
299.1

¥3,794.4
208.3
21.3
0.1
0.4
1.9
493.1
2.1
47.6
569.5
315.9
1,033.7
797.6
—
302.4

63.6
38.3
71.2
65.0

348.6
17.4
9.0
322.2

401.1
21.5
9.0
370.6

¥ 4,094.1¥ 4,195.6

Overseas Offices and loans booked at offshore markets
Governments
Financial Institutions
Others
Total

419.4
21.3
4.4
393.6

472.6
24.3
6.9
441.2

¥ 4,907.8¥ 5,023.7

70.6 %

95

Financial Analysis of Mizuho

Disclosure of Asset Quality

Status of Loans by Nationality of Borrowers
Loans to Restructuring Countries (Aggregated Figures of the Three Banks)
Billions of yen, Number of countries

At March 31

Loan amount
Number of Restructuring Countries

2002

2001

Change¥ 165.5
8¥ 197.6
9¥ (32.0)(1)

Loans to Asia (Aggregated Figures of the Three Banks)
Billions of yen

At March 31

2002

Outstanding Balance
2001

ChangeNon-Accrual, Past Due & Restructured Loans
2002
2001
ChangeHong Kong
Thailand
China
Republic of Korea
Indonesia
Singapore
Others¥ 511.3
340.5
243.2
213.8
182.0
164.5
392.0

¥ 627.6
327.8
270.2
202.7
259.1
163.6
439.1

¥ (116.2)
12.7(27.0)
11.1(77.0)
0.9(47.1)

¥ 4.9
37.8
7.6
3.8
59.8
4.6
21.2

¥ 15.7
33.4
31.7
4.1
50.2
3.2
9.5

¥ (10.7)
4.3(24.0)
(0.3)
9.5
1.4
11.6

Total

¥ 2,047.6¥ 2,290.4¥ (242.7)¥ 139.8¥ 148.0¥ (8.1)Loans to Central and South America (Aggregated Figures of the Three Banks)
Billions of yen

Outstanding Balance
2001

ChangeNon-Accrual, Past Due & Restructured Loans
2002
2001
ChangeAt March 31

2002

MexicoChile
BrazilColombia
Argentina
Others¥ 92.1
54.0
41.2
39.4
30.4
37.3

¥ 87.7
56.4
36.1
44.1
28.7
36.8

¥ 4.3
(2.4)
5.1
(4.7)
1.6
0.4

¥

Total

¥ 294.7¥ 290.1¥ 4.5¥ 22.1

0.8
—
—
0.4
19.1
1.6

¥

—
—
—
0.4
—
1.2
¥ 1.7

¥

0.8
—
—
0.0
19.1
0.4

¥ 20.4Loans to Russia (Aggregated Figures of the Three Banks)
Billions of yen

At March 31

Russia96

2002¥ 19.6

Outstanding Balance2001¥ 18.0Change¥ 1.5

Non-Accrual, Past Due & Restructured Loans
2002
2001
Change

¥ 3.2

¥ 3.7

¥ (0.5)

Results of Removal of Problem Loans (Aggregated Figures of the Three Banks)
 Problem Loans in the First Half of FY 2000 and Before (Accumulated Problem Loans)
The Outstanding Balance of Claims against Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk
(Under the FRL)
Billions of yen

At the endof the first halfof FY2000

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Total

At the endof FY2000¥ 1,039.9
1,425.5¥

663.8
1,080.9¥ 2,465.4¥ 1,744.8

At the endof the first halfof FY2001 (A)Accumulated
Removal from
9/30/2000

At the endof FY2001 (B)Change(B) – (A)

609.3
782.3

¥ 398.6
414.0¥ (210.6)(368.3)¥(641.3)(1,011.3)

61.7%
70.9%

¥ 1,391.7¥ 812.6¥ (579.0)¥ (1,652.7)

67.0%

¥

Removalratio

Types of Removal of Problem Loans
Billions of yen

The second halfof FY2001

Liquidation
Restructure
Improvement in Business Performance due to Restructuring
Securitization
Write-off
Other
Debt Recovery
Improvement in Business Performance¥ (119.0)(43.0)(4.6)(235.6)76.0(252.5)(235.1)(17.4)Total¥ (579.0)

 Problem Loans in the Second Half of FY 2000 (Problem Loans Generated During the Period)
The Outstanding Balance of Claims against Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk
(Under the FRL)
Billions of yen

At the endof FY2000

Claims Against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Total

At the endof the first halfof FY2001 (A)¥ 141.9
531.9

¥

77.7
404.0

¥ 673.9¥ 481.8

At the endof FY2001 (B)

¥

88.7
222.6

¥ 311.6

Change(B) – (A)¥11.0
(181.4)¥ (170.2)

Accumulated
Removal from
9/30/2000¥

Removalratio(53.0)(309.2)

37.4%
58.1%

¥ (362.3)

53.8%

Types of Removal of Problem Loans
Billions of yen

The second halfof FY2001

Liquidation
Restructure
Improvement in Business Performance due to Restructuring
Securitization
Write-off
Other
Debt Recovery
Improvement in Business Performance
Total

¥

(2.0)
(2.6)
0.0
(21.7)(59.0)(84.5)(76.3)(8.1)¥ (170.2)

97

Financial Analysis of Mizuho

Disclosure of Asset Quality

 Problem Loans in the First Half of FY 2001 (Problem Loans Generated During the Period)
The Outstanding Balance of Claims against Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk
(Under the FRL)
Billions of yen

At the endof the first halfof FY2001 (A)Claims against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Total

¥

At the endof FY2001 (B)Change(B) – (A)

257.1
930.1

¥ 267.4
502.7

¥

10.2
(427.2)¥ 1,187.3¥ 770.3¥ (416.8)

Accumulated
Removal from
9/30/2000¥

Removalratio

10.2(427.2)(4.0)%
45.9%¥ (416.8)

35.1%

Types of Removal of Problem Loans
Billions of yen

The second halfof FY2001

Liquidation
Restructure
Improvement in Business Performance due to Restructuring
Securitization
Write-off
Other
Debt Recovery
Improvement in Business Performance
Total

¥

(3.0)
(1.5)
0.0
(17.5)(152.3)(242.2)(141.6)(100.4)¥ (416.8)

 Problem Loans in the Second Half of FY 2001 (Problem Loans Generated During the Period)
The Outstanding Balance of Claims against Bankrupt and Substantially Bankrupt Obligors and Claims with Collection Risk
(Under the FRL)
Billions of yen

At the endof FY2001

Claims Against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Total

¥

305.1
890.3

¥ 1,195.6(Reference) Category of “Intensive Control Obligors” and below at the end of FY 2001
Billions of yen

At the endof FY2001

Claims Against Bankrupt and Substantially Bankrupt Obligors
Claims with Collection Risk
Total

¥ 1,060.3
2,030.1¥ 3,090.4(Reference) Types of Removal of Problem Loans in the Second Half of FY 2001
Billions of yen

The second halfof FY2001

Total of Types of Removal of Problem Loans in the Second Half of FY 2001
Liquidation
Restructure
Securitization
Debt Recovery
Improvement in Business Performance98(1,166.0)(124.0)(47.1)(274.8)(403.6)(179.9)Financial Analysis of Mizuho

Overview of the Accounting Entry made throughthe Corporate Split and Merger Process
On April 1, 2002, Mizuho Securities Co., Ltd. and Mizuho Trust & Banking Co., Ltd. became MHHD's directly-owned subsidiaries by means of"Simplified Method of a Split" provided by the Commercial Code of Japan. On the same day, DKB, Fuji Bank and IBJ, which had been MHHD's
subsidiaries, were combined and reorganized as Mizuho Corporate Bank, Ltd. and Mizuho Bank, Ltd. by means of split and merger.

Shareholders' Equity
Shareholder's equity after the Split and Merger Process is as follows:
At March 31, 2002
AggregatedFigures of theThree Banks (A)Billions of yen

Common Stock and Preferred Stocks¥ 2,571.9
Capital Surplus
2,247.2
Legal Reserve
343.5
Revaluation Reserve for Land, net of Taxes
531.2
Retained Earnings (Accumulated Deficit)(85.7)
After Appropriation for Fiscal 2000
810.3
Net Loss, etc.
(896.1)Net Unrealized Gains (Losses) on Other Securities, net of Taxes (530.3)
Total Shareholders' Equity

After the Split and Merger Process (A)+(B)
AggregatedMizuhoFigures of the
Corporate
MizuhoTwo Banks
Bank
Bank

Accounting Entry
made through the
Corporate Split andMerger Process (B)¥ 5,077.7¥ (1,391.9)(658.0)—(111.6)
896.1
/
/
536.1

¥ 1,180.0
1,589.1
343.5
419.5
810.3
/
/
5.7

¥

710.0
655.2
207.7
110.3
486.2
/
/
(7.5)

¥ 470.0
933.9
135.7
309.2
324.1
/
/
13.3

¥

¥ 4,348.4¥ 2,161.9¥ 2,186.4(729.3)[Breakdown]

Billions of yenSplit of Subsidiaries
Management
BusinessChange inCommon Stock &Preferred Stocks

Common Stock and Preferred Stocks¥ (200.0)
Capital Surplus—
Revaluation Reserve for Land, net of Taxes—
Retained Earnings—
Net Unrealized Gains(Losses) on Other Securities, net of Taxes—
Total¥ (200.0)Change inClassificationof SecuritiesTransfer from
Revaluation
Reserve for Land
Disposal of
Unrealized
Losses
Successionof Retained
Earnings¥ (1,191.9)
1,191.9
—
—
—

¥

—
—
—
—
(15.5)¥—
111.6(111.6)——¥—(1,065.5)
—
—
551.7

¥

— ¥ (1,391.9)(896.1)(658.0)—(111.6)
896.1
896.1
—
536.1

¥

¥ (15.5)¥—¥ (513.7)¥— ¥ (729.3)

—

Total

 Decrease in Common Stock and Preferred Stocks due to split of subsidiaries' management business (Mizuho Securities Co., Ltd. andMizuho Trust & Banking Co., Ltd. became direct subsidiaries of MHHD).
 Change in Common Stock and Preferred Stocks.
 Decrease in net unrealized gains on Other Securities (net of Taxes) by changing classification from investments in affiliates to Other
Securities.
 Transfer from Revaluation Reserve for Land, net of Taxes to Capital Surplus due to split.
 Decrease due to disposal of unrealized losses of ¥1,065.5 billion*.
Increase in net unrealized gains on Other Securities (net of Taxes) due to disposal of unrealized losses of ¥847.1 billion.
Decrease in net unrealized gains on Other Securities (net of Taxes) due to deferred tax effect ¥295.4 billion.
 Succession of Appropriated Retained Earnings after appropriation for FY2000, in accordance with the Commercial Code of Japan.

Disposal of Unrealized Losses
In order to enhance the financial condition, the following unrealized losses are disposed by offsetting with additional capital surplus resulted fromthe Split and Merger Process.
Billions of yen
At March 31, 2002
AggregatedFigures of theThree Banks (A)Other Securities
Stocks (Note)
Bonds / Others
Investment in Foreign Subsidiaries / Affiliates /Foreign Currency Translation Adjustments
Deferred Hedge Losses
Pension Liabilities / Unrecognized Net Obligationby the Change of Accounting policy¥ (887.5)(748.0)(139.4)

Disposal of
Unrealized
Losses (B)

¥

902.6
828.8
73.8

After Disposal of Unrealized Losses (A)+(B)
AggregatedMizuhoFigures of the
Corporate
MizuhoTwo Banks
Bank
Bank

¥

15.1
80.7
(65.6)

¥

(7.5)
41.9
(49.5)¥ 22.738.8(16.0)(116.9)(412.5)

51.0
159.7

(65.9)(252.7)(65.8)(125.2)(0.0)(127.5)(108.6)24.8(83.8)(26.2)(57.5)¥ 1,138.3 (a)Deferred Tax Assets

72.8 (b)*Decrease in Capital Surplus ¥ 1,065.5 (a)-(b)Note:After changing classification

99

Financial Analysis of Mizuho

Overview of the Accounting Entry made throughthe Corporate Split and Merger Process
Assets and Liabilities (for referense only)
Status of Assets and Liabilities after the split and merger process is as follows:

Mizuho Corporate Bank
Billions of yen

AssetsCash and Due from Banks¥ 7,436.4
Call Loans
736.5
Receivables under Resale Agreements
117.2
Other Debt Purchased
120.1
Trading Assets
3,724.5
Money Held in Trust
43.4
Securities
13,795.0
Loans and Bills Discounted
39,626.9
Foreign Exchange Assets
1,001.3
Other Assets
5,386.2
Premises and Equipment
316.7
Deferred Tax Assets
1,131.0
Customers' Liabilities for Acceptances and Gurantees
4,638.0
Reserve for Possible Losses on Loans(970.8)Reserve for Possible Losses on Securities
(2.4)

Total

¥ 77,100.6

Liabilities
Deposits
Negotiable Certificates of Deposit
Debentures
Call Money
Payables under Repurchase Agreements
Bills Sold
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Bonds and Notes
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Reserve for Contingencies
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees¥ 33,538.7
6,733.1
9,350.7
4,616.4
2,064.5956.4
194.5
2,486.0
3,117.4
728.6
653.1
5,636.7
3.4
9.9
134.2
68.8
4,638.0

Total¥ 74,931.0

Total Shareholders' Equity¥ 2,169.5

Mizuho Bank
Billions of yen

AssetsCash and Due from Banks¥ 18,784.4
Call Loans
113.0
Other Debt Purchased
0.3
Trading Assets
1,622.9
Money Held in Trust
1.5
Securities
9,742.5
Loans and Bills Discounted
40,947.4
Foreign Exchange Assets
167.0
Other Assets
3,024.6
Premises and Equipment
1,256.0
Deferred Debenture Charges
4.0
Deferred Tax Assets
837.6
Customers' Liabilities for Acceptances and Gurantees
1,753.7
Reserve for Possible Losses on Loans(718.6)
Reserve for Possible Losses on Securities(97.4)

Total

100¥ 77,439.4

Liabilities
Deposits¥ 52,528.1
Negotiable Certificates of Deposit
4,520.0
Debentures
6,101.7
Call Money2,820.6
Payables under Repurchase Agreements
330.4
Bills Sold
984.3
Commercial Paper
235.0
Trading Liabilities
1,041.7
Borrowed Money
1,635.6
Foreign Exchange Liabilities
8.0
Other Liabilities
2,988.1
Reserve for Bonus Payments
10.6
Reserve for Employee Retirement Benefits
30.9
Reserve for Possible Losses on Loans Sold
48.2
Reserve for Possible Losses on Support of Specific Borrowers
32.4
Deferred Tax Liabilities for Revaluation Reserve for Land
196.5
Acceptances and Guarantees
1,753.7
Total¥ 75,266.3

Total Shareholders' Equity¥ 2,173.1

Aggregated Figures of the Two Banks
Billions of yen

AssetsCash and Due from Banks¥ 26,220.9
Call Loans
849.5
Receivables under Resale Agreements
117.2
Other Debt Purchased
120.5
Trading Assets
5,347.4
Money Held in Trust
44.9
Securities
23,537.5
Loans and Bills Discounted
80,574.3
Foreign Exchange Assets
1,168.4
Other Assets
8,410.9
Premises and Equipment
1,572.8
Deferred Debenture Charges
4.1
Deferred Tax Assets
1,968.6
Customers' Liabilities for Acceptances and Gurantees
6,391.8
Reserve for Possible Losses on Loans(1,689.5)
Reserve for Possible Losses on Securities(99.8)

Total¥ 154,540.0

Liabilities
Deposits¥ 86,066.8
Negotiable Certificates of Deposit
11,253.1
Debentures
15,452.4
Call Money
7,437.0
Payables under Repurchase Agreements
2,395.0
Bills Sold
1,940.7
Commercial Paper
429.5
Trading Liabilities
3,527.8
Borrowed Money
4,753.0
Foreign Exchange Liabilities
736.6
Bonds and Notes
653.1
Other Liabilities
8,624.8
Reserve for Bonus Payments
14.0
Reserve for Employee Retirement Benefits
40.9
Reserve for Possible Losses on Loans Sold
48.2
Reserve for Possible Losses on Support of Specific Borrowers
32.4
Reserve for Contingencies
134.2
Deferred Tax Liabilities for Revaluation Reserve for Land
265.4
Acceptances and Guarantees
6,391.8
Total¥ 150,197.4

Total Shareholders' Equity¥

4,342.6

Note: The balances are provided for information purposes and therefore differ from those for financial reporting purposes in certain aspects such as other securities valued at cost.

101

Financial Analysis of Mizuho

Overview of the Accounting Entry made throughthe Corporate Split and Merger Process
Status of Loan Loss Reserves
Status of Loan Loss Reserves after the Split and Merger Process is as follows:
Billions of yen

At March 31, 2002
AggregatedFigures of theThree Banks

Reserve for Possible Losses on Loans
General Reserve for Possible Losses on Loans
Specific Reserve for Possible Losses on Loans
Reserve for Possible Losses on
Loans to Restructuring Countries
Reserve for Possible Losses on
Support of Specific Borrowers
Reserve for Possible Losses on Loans Sold
Reserve for Possible Losses on Securities
Reserve for Contingencies

After the Split and Merger Process
AggregatedMizuhoFigures of the
Corporate
Two BanksBank

Mizuho Bank¥ 1,689.5
788.6
869.3

¥ 1,689.5
788.6
869.3

¥ 970.8
470.8
468.4

¥ 718.6
317.7
400.9

31.5

31.5

31.5

—

32.4
48.2
99.8
134.2

32.4
48.2
99.8
134.2

—
—
2.4
134.2

32.4
48.2
97.4
—

Status of Loans to be Disclosed (After Direct Write-offs of Category IV Loans)
Status of Loans to be disclosed after the Split and Merger Process is as follows: Non-Accrual, Past Due & Restructured Loans
Non-Accrual, Past Due & Restructured Loans
Billions of yen

At March 31, 2002
AggregatedFigures of theThree Banks

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans

¥

Total

583.8
2,390.6
67.7
1,865.5¥ 4,907.8

After the Split and Merger Process
AggregatedMizuhoFigures of the
Corporate
Two BanksBank
Mizuho Bank

¥

583.8
2,390.6
67.7
1,865.5¥ 4,907.8

¥

432.5
975.4
6.2
1,119.3¥ 2,533.6¥

151.3
1,415.2
61.4
746.1¥ 2,374.1

Ratio to Total Loans (Balance as of March 31,2002)
At March 31, 2002
AggregatedFigures of theThree Banks

Loans to Bankrupt Obligors
Non-Accrual Delinquent Loans
Loans Past Due for 3 Months or More
Restructured Loans
Total

After the Split and Merger Process
AggregatedMizuhoFigures of the
Corporate
Two BanksBank
Mizuho Bank

0.72%
2.96
0.08
2.31

0.72%
2.96
0.08
2.31

1.09%
2.46
0.01
2.82

0.36%
3.45
0.15
1.82

6.09%

6.09%

6.39%

5.79%

 Status of Disclosed Claims under the FRL

Billions of yen

At March 31, 2002
AggregatedFigures of theThree Banks

Claims against Bankrupt andSubstantially Bankrupt Obligors
Claims with Collection Risk
Claims for Special Attention
Total
102

After the Split and Merger Process
AggregatedMizuhoFigures of the
Corporate
Two BanksBank
Mizuho Bank

¥ 1,060.3
2,030.1
1,933.2¥ 1,060.3
2,030.1
1,933.2

¥

666.5
833.4
1,125.6¥ 5,023.7¥ 5,023.7¥ 2,625.6¥

393.8
1,196.6
807.6¥ 2,398.1

104 Financial Data of Mizuho Holdings
Report of Independent Certified Public Accountants

104

Consolidated Balance Sheets

105

Consolidated Statements of Operations

106

Consolidated Statements of Shareholders' Equity

107

Consolidated Statements of Cash Flows

109

Notes to Consolidated Financial Statements

111

103

Financial Data of Mizuho Holdings

Report of Independent Certified Public Accountants

The Board of Directors
Mizuho Holdings, Inc.
We have audited the accompanying consolidated balance sheets of Mizuho Holdings, Inc. (“MHHD”) and its consolidated subsidiaries as of March 31, 2002 and 2001, and the related consolidated statements of operations, shareholders’ equity and cash
flows for the years then ended, all expressed in Japanese yen. Our audits were made in accordance with auditing standards, procedures and practices generally accepted and applied in Japan and, accordingly, included such tests of the accounting records andother auditing procedures as we considered necessary in the circumstances.
In our opinion, the consolidated financial statements referred to above, expressed in Japanese yen, present fairly the consolidated
financial position of MHHD and its consolidated subsidiaries as of March 31, 2002 and 2001, and the consolidated results of theiroperations and their cash flows for the years then ended, in conformity with accounting principles and practices generally
accepted in Japan, applied on a consistent basis.
As described in Notes 3 (2) to the consolidated financial statements, MHHD and its consolidated subsidiaries have adopted new
accounting standards for financial instruments, which affected the valuation of other securities and money held in trust effective
April 1, 2001.
The amounts expressed in U.S. dollars in the accompanying consolidated financial statements with respect to the year ended
March 31, 2002 are provided solely for the convenience of the reader. We have recomputed the translation of Japanese yen into
U.S. dollar amounts and, in our opinion, such translation has been made on the basis set forth in Note 1 to the consolidated
financial statements.

Shin Nihon & Co.

ChuoAoyama Audit Corporation

Tokyo, Japan
June 25, 2002

See Note 1 to the consolidated financial statements which explains the basis of presentation of the consolidated financial statements of MHHD and its consolidated subsidiaries under Japanese accounting
principles and practices.

104

Financial Data of Mizuho Holdings

Consolidated Balance Sheets

Millions of yen
2002

At March 31

AssetsCash and Due from Banks (Notes 12 and 38)
Call Loans and Bills Purchased (Note 12)
Receivables under Resale Agreements
Other Debt Purchased (Note 38)
Trading Assets (Notes 4, 12 and 38)
Money Held in Trust (Note 38)
Securities (Notes 5, 12 and 38)
Loans and Bills Discounted (Notes 6 and 12)
Foreign Exchange Assets (Notes 7 and 12)
Other Assets (Notes 8 and 12)
Premises and Equipment (Notes 9 and 12)
Deferred Debenture Charges (Note 10)
Deferred Tax Assets (Note 35)
Consolidation Differences
Customers’ Liabilities for Acceptances and Guarantees (Note 24)
Reserve for Possible Losses on Loans (Note 11)
Reserve for Possible Losses on Securities

2001¥ 11,720,134
942,285
1,768,766
604,395
7,951,419
69,762
24,108,931
84,593,656
1,186,977
11,067,767
1,753,497
4,843
2,509,110
64,296
4,923,244(1,949,819)(6,841)¥¥ 151,312,427¥ 163,455,480$ 1,135,552,930¥ 85,606,235
15,310,890
9,453,692
4,855,073
711,382
4,883,842
2,553,382
708,2312,966,847
8,432
1,776,404
11,278,184
21,801
36,61949,647—135,154
15,741
335,108
4,923,244¥ 80,176,482
17,848,257
13,208,076—
2,369,254
4,687,700
3,871,945
273,849
3,998,017
8,088
1,826,412
21,186,842—
126,050
199,093
159,628
24,74011,462
343,728
6,129,641$

Total Liabilities

145,629,916

156,449,275

1,092,907,441

Minority Interests

951,091

751,933

7,137,646

Shareholders’ Equity
Common Stock and Preferred Stock (Note 26)
Capital Surplus
Revaluation Reserve for Land, net of Taxes (Note 25)
Retained Earnings
Net Unrealized Losses on Other Securities, net of Taxes (Note 38)
Foreign Currency Translation Adjustments

2,572,000
2,203,747
534,447
101,133(558,485)(120,167)

2,572,000
2,203,747
548,533
1,107,231—(175,430)

19,302,064
16,538,446
4,010,860
758,977(4,191,262)(901,820)

Subtotal
Treasury Stock

4,732,675(1,255)

6,256,083(1,812)35,517,265(9,422)

Total Assets
Liabilities, Minority Interests and Shareholders’ Equity
Liabilities
Deposits (Note 13)
Debentures (Note 14)
Call Money and Bills Sold (Note 15)
Payables under Repurchase Agreements
Commercial Paper (Note 16)
Trading Liabilities (Note 4)
Borrowed Money (Note 17)
Foreign Exchange Liabilities (Note 7)
Bonds and Notes (Note 18)
Convertible Bonds (Note 19)
Due to Trust Accounts
Other Liabilities (Note 20)
Reserve for Bonus Payments (Note 21)
Reserve for Employee Retirement Benefits (Note 22)
Reserve for Possible Losses on Loans Sold
Reserve for Possible Losses on Support of Specific Borrowers
Other Reserves (Note 23)
Deferred Tax Liabilities (Note 35)
Deferred Tax Liabilities for Revaluation Reserve for Land (Note 25)
Acceptances and Guarantees (Note 24)

Total Shareholders’ Equity
Total Liabilities, Minority Interests and Shareholders’ Equity

5,011,232
2,343,046—
703,619
10,877,475
392,367
28,062,563
92,286,772
845,277
14,940,725
1,713,356
9,531
1,663,971
107,764
6,129,641(1,627,632)(4,233)Thousands of
U.S. dollars (Note 1)
2002$

87,955,983
7,071,562
13,274,044
4,535,803
59,672,941
523,550
180,930,066
634,849,206
8,907,898
83,060,167
13,159,456
36,347
18,830,097
482,526
36,947,424(14,632,794)(51,346)

642,448,297
114,903,495
70,947,032
36,435,826
5,338,702
36,651,728
19,162,343
5,315,062
22,265,268
63,28013,331,369
84,639,285
163,615
274,818
372,587—
1,014,292
118,133
2,514,885
36,947,424

4,731,420

6,254,270

35,507,843¥ 151,312,427¥ 163,455,480$ 1,135,552,930

See accompanying “Notes to Consolidated Financial Statements” which are an integral part of these statements.

105

Financial Data of Mizuho Holdings

Consolidated Statements of Operations

2001

Thousands of
U.S. dollars (Note 1)
2002¥ 3,020,489
54,443544,238
178,884
651,035
866,499¥ 3,512,272
65,111
513,194
156,508
577,125
1,089,530$ 22,667,837
408,584
4,084,339
1,342,474
4,885,820
6,502,813

5,315,591

5,913,742

39,891,867

1,492,876
43,156451,041
1,368,206
3,385,481

2,158,303
85,262
431,320
1,228,618
1,530,161

11,203,574
323,879
3,384,930
10,267,964
25,406,987

Millions of yen
2002

For the Fiscal Years ended March 31

IncomeInterest Income (Note 27)
Fiduciary Income
Fee and Commissions Income
Trading Income (Note 28)
Other Operating Income (Note 29)
Other Income (Note 30)
Total Income
Expenses
Interest Expenses (Note 27)
Fee and Commissions Expenses
Other Operating Expenses (Note 31)
General and Administrative Expenses
Other Expenses (Note 32)
Total Expenses

6,740,762

5,433,665

50,587,334(1,425,170)

480,077(10,695,467)

110,498(545,923)(13,701)

51,621
146,376
70,819829,258(4,096,985)(102,825)

211,260$ (7,324,915)

2002

2001

U.S. dollars (Note 1)
2002¥ (108,003.27)—
3,500¥ 20,524.13
20,109.99
7,000*

Income (Loss) before Income Taxes and Minority Interests
Income Taxes:
Current
Deferred
Minority Interests in Net Income (Loss)Net Income (Loss)¥(976,044)¥

Yen

Per Share of Common StockNet Income (Loss):
Basic
DilutedCash Dividends$*Stock transfer payments of ¥3,500 per share of common stock paid instead of interim cash dividends to shareholders of DKB, Fuji Bank and IBJ as of September 27, 2000, are included.
See accompanying “Notes to Consolidated Financial Statements,” which are an integral part of these statements.

106(810.53)—
26.27

Financial Data of Mizuho Holdings

Consolidated Statements of Shareholders' Equity

Millions of yen

Common Stockand Preferred
Stock

CapitalSurplus

Revaluation
Reservefor LandRetained
Earnings

Foreign
Currency
Translation
Adjustments

Balance at April 1, 2000
Stock Transfer Payments
Effect of the Change in Scopeof Consolidated Subsidiaries
Transfer from Revaluation
Reserve for Land
Transfer from Deferred Tax Liabilities
Related to Land Revaluation
Effect on the Change in Scopeof Consolidated Subsidiaries
Exclusion from Consolidationof Affiliates
Effect of the Change
in Foreign Exchange Rate
Cash Dividends
Bonuses to Directors andStatutory Auditors
Net Income
Treasury Stock Transactions¥2,572,000—¥2,247,155(43,407)¥565,652—¥ 917,065—¥(194,129)—¥(7,597)—¥6,100,145(43,407)

—

—

—

730

—

—

730

—

—

(21,748)

21,748

—

—

—

—

—

4,629

—

—

—

4,629

—

—

—

(147)

—

—

(147)

—

—

—

(17)

—

—

(17)

—
—

—
—

—
—

—
(43,407)

18,699———18,699(43,407)

—
—
—

—
—
—

—
—
—

(0)
211,260
—

—
—
—

—
—
5,785

(0)
211,260
5,785

Balance at March 31, 2001

¥2,572,000¥2,203,747¥548,533¥1,107,231¥(175,430)¥(1,812)¥6,254,270

For the Fiscal Year ended March 31,2001

Treasury
Stock

Total
Shareholders’EquityMillions of yen

For the Fiscal Year ended March 31,2002

Common Stockand Preferred
Stock

CapitalSurplus

Revaluation
Reservefor LandNet Unrealized
Losses on Other
Retained
Securities,
Earnings net of Taxes

Foreign
Currency
Translation
Adjustments

Treasury
Stock

Total
Shareholders’EquityBalance at April 1, 2001
¥2,572,000 ¥2,203,747
Net Unrealized Losses on Other
Securities, net of Taxes, at theInitial Application of New
Accounting Standard——
Effect of the Change
in Foreign Exchange Rate——
Transfer from Revaluation Reserve for Land——
Transfer to Deferred Tax Liabilities
Related to Land Revaluation——
Effect of the Change in Scopeof Consolidated Subsidiaries——
Exclusion from Consolidation of Affiliates——
Cash Dividends——
Bonuses to Directors andStatutory Auditors——
Net Loss——
Treasury Stock Transactions——¥548,533 ¥1,107,231

Balance at March 31, 2002

¥534,447 ¥ 101,133 ¥(558,485) ¥(120,167) ¥(1,255) ¥4,731,420¥2,572,000 ¥2,203,747— ¥(175,430) ¥(1,812) ¥6,254,270——(558,485)——(558,485)—(13,560)—
13,560——55,262———55,262
—

(525)

—

—

—

—

(525)

—
—
—

(30)
(175)
(43,407)

—
—
—

—
—
—

—
—
—

(30)
(175)
(43,407)

—
—
—

(0)
(976,044)
—

—
—
—

—
—
—

—
—
556

(0)
(976,044)
556

107

Financial Data of Mizuho Holdings

Consolidated Statements of Shareholders' Equity

Thousands of U.S. dollars (Note 1)

For the Fiscal Year ended March 31,2002

Common Stockand Preferred
Stock

CapitalSurplus

Revaluation
Reservefor LandNet Unrealized
Losses on Other
Retained
Securities,
Earnings net of Taxes

Foreign
Currency
Translation
Adjustments

Treasury
Stock

Total
Shareholders’EquityBalance at April 1, 2001
$19,302,064 $16,538,446 $4,116,572 $8,309,433— $(1,316,549) $(13,600) $46,936,366
Net Unrealized Losses on Other
Securities, net of Taxes, at theInitial Application of New
Accounting Standard———— (4,191,262)—— (4,191,262)
Effect of the Change
in Foreign Exchange Rate
—
—
—
—
—
414,729—414,729
Transfer from Revaluation Reserve for Land—— (101,770)
101,770————
Transfer from Deferred Tax Liabilities
Related to Land Revaluation——(3,942)————(3,942)
Effect of the Change in Scopeof Consolidated Subsidiaries
—
—
—
(230)
—
—
—
(230)
Exclusion from Consolidation of Affiliates———(1,316)———(1,316)
Cash Dividends——— (325,758)——— (325,758)
Bonuses to Directors andStatutory Auditors
—
—
—
(7)
—
—
—
(7)
Net Loss——— (7,324,915)——— (7,324,915)
Treasury Stock Transactions
—
—
—
—
—
—
4,178
4,178
Balance at March 31, 2002

108

$19,302,064 $16,538,446 $4,010,860$758,977 $(4,191,262)$(901,820)$(9,422) $35,507,843

Financial Data of Mizuho Holdings

Consolidated Statements of Cash Flows2001

Thousands of
U.S. dollars (Note 1)
2002

480,077
75,28323,002(18,036)(421,915)(7,631)(110,663)(64,023)
10,094—(145,991)
125,957(3,512,272)
2,158,303(700,515)
9,000(578,274)
38,337(11,789)(582,053)(79,145)442,2312,203,779(1,531,894)(182,296)
253,674(46,169)
716,387
192,795
2,053,226
981,573
907,528
54,677(77,391)(104,109)
246,308
3,526,703(2,210,161)(1,154,274)$ (10,695,467)
711,068
158,818
50,8202,713,270
20,803(1,121,545)(1,197,961)
826,801
163,530—(265,448)(22,667,837)
11,203,574(1,514,922)
131,350(3,103,420)
248,551(668,193)
23,641,325(346,922)
47,985,370
36,633,175(19,042,153)
3,086,213
7,286,778
632,551
9,904,445(3,966,615)(2,930,082)(8,572,847)(4,166,683)(2,364,939)
3,188,253(772,306)(375,294)
23,233,694(12,037,471)(24,166,901)

6,908,130(131,692)

2,960,333(41,535)

51,843,383(988,312)¥ 6,776,438¥ 2,918,798$ 50,855,071

Millions of yen
For the Fiscal Years ended March 31

I. Cash Flows from Operating Activities
Income (Loss) before Income Taxes and Minority Interests
Depreciation
Amortization of Consolidation Differences
Equity in Losses (Income) from Investments in Affiliates
Increase (Decrease) in Reserve for Possible Losses on Loans
Increase (Decrease) in Reserve for Possible Losses on Securities
Decrease in Reserve for Possible Losses on Loans Sold
Decrease in Reserve for Possible Losses on Support of Specific Borrowers
Increase in Reserve for Contingencies
Increase in Reserve for Bonus Payments
Decrease in Reserve for Retirement Allowance
Increase (Decrease) in Reserve for Employee Retirement Benefits
Interest Income—accrual basis
Interest Expenses—accrual basis
Gains on Securities
Losses from Money Held in Trust
Foreign Exchange Gains—Net
Losses on Disposal of Premises and Equipment
Gains on Establishment of Retirement Benefit Trusts
Net Decrease (Increase) in Trading Assets
Net Decrease in Trading Liabilities
Net Decrease in Loans and Bills Discounted
Net Increase in Deposits
Net Decrease in Debentures (excluding Subordinated Debentures)
Net Increase (Decrease) in Borrowed Money (excluding Subordinated Borrowed Money)
Net Decrease in Due from Banks (excluding Deposits with Central Banks)
Net Decrease (Increase) in Negotiable Certificates of Deposit
Net Decrease in Call Loans
Net Decrease (Increase) in Cash Placed as Collateral on Securities Borrowed
Net Increase (Decrease) in Call Money
Net Increase (Decrease) in Commercial Paper
Net Increase (Decrease) in Cash Received as Collateral for Securities Lent
Net Decrease (Increase) in Foreign Exchange Assets
Net Increase (Decrease) in Foreign Exchange Liabilities
Net Decrease in Issuance, Redemption of Bonds and Notes
Net Increase (Decrease) in Due to Trust Accounts
Interest Income—cash basis
Interest Expenses—cash basis
Others—net
Subtotal
Cash Paid in Income Taxes
Net Cash Provided by Operating Activities

2002¥ (1,425,170)
94,74921,162
6,771
361,543
2,771(149,445)(159,628)
110,171
21,790—(35,370)(3,020,489)
1,492,876(201,863)
17,502(413,530)
33,119(89,036)
3,150,206(46,227)
6,394,050
4,881,370(2,537,366)
411,237
970,963
84,287
1,319,767(528,551)(390,433)(1,142,331)(555,210)(315,128)
424,834(102,909)(50,007)3,095,889(1,603,992)(3,220,239)¥

109

Financial Data of Mizhuo Holdings

Consolidated Statements of Cash Flows

2002

2001

Thousands of
U.S. dollars (Note 1)
2002¥ (58,967,968)
40,450,103
19,571,083(109,999)
429,371(193,154)
35,109¥ (80,782,961)
58,620,081
18,957,642(756,913)
655,289(117,718)
63,299$ (442,536,351)
303,565,502
146,874,922(825,514)
3,222,303(1,449,567)
263,488(1,064)—(7,988)318,553—

2,390,646(1,282)(961)(9,622)—47—

1,530,751(3,362,193)

11,487,819

116,000(644,800)
274,033(719,117)
379,874(16,487)(43,393)—(43,421)(323)
233

166,000(306,778)
316,134(381,781)
800—(43,407)(43,351)(42,259)(2,814)
2,693

870,544(4,839,024)
2,056,533(5,396,754)
2,850,841(123,734)(325,651)—(325,861)(2,429)1,752(697,401)(334,763)(5,233,783)

Millions of yen

II. Cash Flows from Investing Activities
Payments for Purchase of Securities
Proceeds from Sale of Securities
Proceeds from Redemption of Securities
Payments for Increase in Money Held in Trust
Proceeds from Decrease in Money Held in Trust
Payments for Purchase of Premises and Equipment
Proceeds from Sale of Premises and Equipment
Payments for Purchase of Stocks of Subsidiaries(affecting the scope of consolidation)
Proceeds from Sale of Stocks of Subsidiaries(affecting the scope of consolidation)
Payments for Purchase of Stock of Subsidiaries(not affecting the scope of consolidation)
Proceeds from Sale of Stock of Subsidiaries(not affecting the scope of consolidation)
Net Cash Provided by (Used in) Investing Activities
III. Cash Flows from Financing Activities
Proceeds from Issuance of Subordinated Borrowed Money
Repayments for Subordinated Borrowed Money
Proceeds from Issuance of Subordinated Bonds, Notes and Convertible Bonds
Redemption of Subordinated Bonds, Notes and Convertible Bonds
Proceeds from Investments in Minority Interests
Payments for Minority Interests
Dividends Paid
Stock Transfer Payments
Dividends Paid for Minority Interests
Purchase of Treasury Stock
Proceeds from Sales of Treasury Stock
Net Cash Used in Financing Activities
IV. Effects of Exchange Rate Changes on Cash and Cash Equivalents

17,731

15,074133,070

V. Net Increase (Decrease) in Cash and Cash Equivalents

7,627,520(763,083)

57,242,177

VI. Cash and Cash Equivalents at the Beginning of the Year
VII. Net Increase in Cash and Cash Equivalents resulting
from Inclusion of Subsidiaries in the scope of Consolidation

2,219,805

2,982,889

16,658,954

46

—

348

VIII. Net Decrease in Cash and Cash Equivalents Resolved
from Exclusion of Subsidiaries from the Scope of Consolidation
IX. Cash and Cash Equivalents at the End of the Year (Note 33)
See accompanying “Notes to Consolidated Financial Statements”, which are an integral part of these statements.

110

(5)
¥

9,847,366(0)¥2,219,805(42)$

73,901,437

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

1. Basis of Presentation
The accompanying consolidated financial statements have been prepared from the accounts maintained by Mizuho Holdings, Inc.
(“MHHD”) and its consolidated subsidiaries in accordance with the provisions set forth in the Commercial Code of Japan and the
Securities and Exchange Law, and in conformity with accounting principles and practices generally accepted in Japan (“Japanese
GAAP”). Japanese GAAP may differ to some degree from accounting principles and practices generally accepted in countries andjurisdictions other than Japan.
Certain items presented in the consolidated financial statements filed with the Director of the Kanto Finance Bureau are reclassified for the convenience of readers outside Japan. In addition, the Consolidated Statement of Shareholders’ Equity is presented
and included in the consolidated financial statements, though it is not required to be filed with the Director of the Kanto Finance
Bureau. The notes to the consolidated financial statements include information which is not required under Japanese GAAP but ispresented herein as additional information.
On September 29, 2000, The Dai-Ichi Kangyo Bank, Limited (“DKB”), The Fuji Bank, Limited (“Fuji Bank”) and The Industrial
Bank of Japan, Limited (“IBJ”) (collectively, “the Three Banks”) established MHHD by way of stock transfers. As a result of thistransaction, each of the Three Banks has become a wholly-owned subsidiary of MHHD.
The formation of MHHD and the stock-for-stock exchange of the Three Banks ( the “Combination”) were accounted for using
the pooling-of-interests method in accordance with “Accounting for the Consolidation of a Holding Company Established by
Stock Exchange or Stock Transfers” (JICPA Accounting Committee Research Report No. 6) and, as such, the assets and liabilitiesof the Three Banks are combined at book value. In addition, the Consolidated Statement of Income gives effect to the transaction
as if the transaction occurred at the beginning of the fiscal year presented, regardless of when the Combination was in effect.
As there are no accounting requirements for the financial statements to be restated for prior periods under Japanese GAAP,
the opening balances of the fiscal year in the Consolidated Statement of Shareholders’ Equity are presented, assuming MHHD
had existed as of April 1, 2000.
The amounts indicated in millions of yen are rounded down by truncating the figures below one million. Totals may not add up
exactly because of such truncation. Amounts in U.S. dollars are included solely for the convenience of readers outside Japan. The
rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation. The inclusion of suchamounts is not intended to imply that Japanese yen has been or could be readily converted, realized or settled into U.S dollars atthat rate or any other rate.

2. Principles of Consolidation(1) Scope of Consolidation
The consolidated financial statements include the accounts of MHHD and its subsidiaries (collectively, “MHFG”), including DKB,
Fuji Bank, IBJ, Mizuho Securities Co., Ltd., Mizuho Trust & Banking Co., Ltd. and other subsidiaries. The number of consolidated
subsidiaries as of March 31, 2002 and 2001 was 171 and 290, respectively. In the fiscal year ended March 31, 2002, UC Card
Co., Ltd., Mizuho Preferred Capital (Cayman) 1 Limited and 18 other companies were newly consolidated due to the increaseof MHHD’s interests in these companies or the incorporation of the companies, and Heller Financial, Inc., its 107 consolidated
subsidiaries and 31 other companies were excluded from the scope of consolidation as a result of merger, liquidation and otherreasons. The consolidated financial statements for the fiscal years ended March 31, 2002 and 2001 do not include the accounts
of ONKD, Inc., FIMCO SPC (Cayman) Limited and other subsidiaries, as they are considered immaterial in terms of the respective group ownerships of Total Assets and Net Income / Net Loss and Retained Earnings.
The number of affiliates accounted for under the equity method as of March 31, 2002 and 2001 was 30 and 91, respectively.
Investments in affiliates include The Chiba Kogyo Bank, Ltd. and Shinko Securities Co., Ltd and other affiliates. In the fiscal year
ended March 31, 2002, World Gateway, Inc. and 5 other companies were newly accounted for under the equity method, due
to merger or incorporation of the company, and The CIT Group Inc., 55 affiliates of Heller Financial, Inc. and 11 other companies were excluded from the scope of investments accounted for under the equity method as a result of sales and mergers.
Non-consolidated subsidiaries, including ONKD, Inc., FIMCO SPC (Cayman) Limited and certain affiliates, are not accounted forunder the equity method, as they are not significant for the consolidated financial statements of MHHD.
On consolidation, significant intercompany accounts and transactions have been eliminated. In addition, all significant unrealized profit included in assets resulting from transactions within MHFG has also been eliminated.
The accounting standard for consolidated financial statements requires a company to consolidate all subsidiaries of which thecompany controls the operations, irrespective of whether or not the company owns a majority of their shares. Control is considered to exist where the company has (a) the power to appoint or remove the majority of the Board of Directors or an equivalent
governing body, and/or (b) the power to cast the majority of the votes at a meeting of the Board of Directors or an equivalent
governing body.
111

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(2) Year-end Dates of Consolidated Subsidiaries
The accompanying consolidated financial statements include the accounts of subsidiaries whose fiscal year-ends are other thanMarch 31. Fiscal year-ends of such subsidiaries are principally December 31.
Consolidated subsidiaries with fiscal year-ends of the day before the last business day of June that were incorporated on
January 2002, performed tentative closings and prepared financial statements as of and for the period ended March 31, 2002.
Consolidated subsidiaries with fiscal year-ends of June 30 and October 31 performed tentative annual closings and preparedfinancial statements as of and for the year ended December 31. Other consolidated subsidiaries are consolidated based on
respective fiscal year-ends after making necessary adjustments for significant transactions recorded during the period between
these subsidiaries’ fiscal year-ends and the date of the consolidated financial statements.
(3) Application of Pooling-of-Interests Method
The Combination is accounted for by the pooling-of-interests method as risks and benefits are mutually shared by the former
shareholders of the Three Banks and the acquiring entity is unable to be identified. The basis for this conclusion is as follows:
1) Almost all of the common stock with voting rights of the Three Banks are exchanged with those of MHHD with substantially
identical rights, and there are no significant restrictions to voting rights, and similar rights, on those exchanged stocks.
2) Fair values of the Three Banks are not significantly different from one another. Market capitalizations of each of the Three
Banks as of August 18, 1999, the day before the announcement of the Combination, were not significantly different fromone another. Market capitalizations, calculated by the number of voting common stocks issued multiplied by the closing
price at the Tokyo Stock Exchange on August 18, 1999, were as follows:
DKB:
1.094
Fuji Bank:
1.258
IBJ:
1.000
(Market capitalization of IBJ = 1.000)
Furthermore, market capitalizations based on the average closing price for the period from April 1, 1999 through August
18, 1999, which were used to calculate the stock exchange ratio, were not significantly different from one another as follows:
DKB:
1.078
Fuji Bank:
1.192
IBJ:
1.000
(Market capitalization of IBJ = 1.000)
3) None of the Three Banks has dominance in the decision-making processes of MHHD relating to significant financial, operating or business policies.
4) None of the Three Banks has dominance in the Board of Directors or other decision-making bodies of MHHD.
(4) Amortization of Difference between Cost and Underlying Interests
In principle, the difference between the fair value of net assets and the cost of the acquired subsidiary is being amortized over a
period within 20 years from the date of acquisition, and the unamortized balance is recorded as “Consolidation Differences”
on the Consolidated Balance Sheets. If these amounts have no material impact on the consolidated financial statements of
MHHD, they are charged or credited to income in the year of acquisition.
3. Summary of Significant Accounting Policies(1) Trading Assets and Trading Liabilities
Trading transactions intended to take advantage of short-term fluctuations and arbitrage opportunities in interest rates,
currency exchange rates, market prices of securities and related indices are recognized on a trade date basis and recordedin Trading Assets or Trading Liabilities on the Consolidated Balance Sheets.
Securities and other short-term credit instruments held for trading purposes are stated at fair value at the balance sheet date.
Derivative financial products, such as swaps, forward contracts and option transactions, are stated at their fair values, assumingthat such transactions were terminated and settled at the balance sheet date.
Trading Income and Trading Expenses include the interest received and interest paid during the fiscal year, the gains or losses
resulting from any change in the value of securities and monetary claims between the beginning and the end of the fiscal year
and the gains or losses resulting from any change in the value of financial derivatives between the beginning and the end of
the fiscal year, assuming they were settled at the end of the fiscal year.

112

(2) Securities
MHHD adopted the Accounting Standard for Financial Instruments which requires securities to be classified into three categories based upon management’s intent. These securities are to be accounted for as follows:(i) Trading securities are carried at market value and included in Trading Assets.
(ii) Bonds held to maturity are stated at amortized cost as determined by the moving average method although MHFG had nosuch bonds as of March 31, 2001 and 2002.
(iii) Other securities, which are not classified as either of trading securities or bonds held to maturity were stated at cost or
amortized cost as determined by mainly the moving average method until the fiscal year ended March 31, 2001. In accordance with the requirement of the Accounting Standard for Financial Instruments, effective April 1, 2001, Other securities
which have readily determinable fair value are stated at fair value with changes in net unrealized gains or losses, net of theapplicable income taxes, included directly in shareholders’ equity. The effect of this change was to increase “Money Held inTrust” by ¥376 million ($2,827 thousand), and to decrease Securities (including Negotiable Certificate of Deposit andCommercial Paper Owned) by ¥ 887,520 million ($6,660,563 thousand) and to record ¥ 558,485 million ($4,191,262 thousand) in “Net Unrealized Losses on Other Securities, net of Taxes.”
Dividend income was recognized when it was declared until the fiscal year ended March 31, 2001. Effective April 1, 2001,
accrued dividends have been recognized based on the best estimates in accordance with the requirement of the AccountingStandard for Financial Instruments. Also, Other securities were recognized and derecognized on the settlement date until thefiscal year ended March 31, 2001. Effective April 1, 2001, Other securities have been recognized and derecognized on tradedate in accordance with the requirement of the Accounting Standard for Financial Instruments. The effect of these changes
for the year ended March 31, 2002, was to decrease “Securities” by ¥95,767 million ($718,708 thousand), “Loss before
Income Taxes and Minority Interests” by ¥36,081 million ($270,780 thousand) and increase “Other Assets” and “Other
Liabilities” by ¥160,095 million ($1,201,469 thousand) and ¥28,246 million ($211,980 thousand), respectively.
In addition, investments in non-consolidated subsidiaries and affiliates which are not accounted for under the equity
method are valued at cost as determined by the moving average method.
Securities included in Money Held in Trust are valued mainly on a mark-to-market basis.
(3) Securities Transactions with Repurchase and Resale Agreement
Until the fiscal year ended March 31, 2001, securities transactions with repurchase/resale agreements of domestic consolidatedbanking subsidiaries were recorded as a purchase or sale transaction. Effective April 1, 2001, these transactions are recorded as
cash lending/borrowing and recorded in “Receivables Under Resale Agreements” or “Payables Under Repurchase Agreements.” The effect of this change was to increase “Securities in Custody and Other” under “Other Assets” and “Securities
Borrowed” in “Other Liabilities” by ¥17,633 million ($132,337 thousand), respectively. Furthermore, effective April 1, 2001,
net payables or receivables arising from pending trades relating to the transactions with repurchase/resale agreements have nolonger been recognized in “Other Assets” and “Other Liabilities”.
(4) Derivatives
Derivative transactions are valued at fair value with changes in fair value included in current income. Derivatives, which qualified as hedges, are mainly accounted for using the deferral method of hedge accounting (see the following note).
(5) Hedge Accounting
The macro-hedge method is adopted by the domestic banking and certain trust banking consolidated subsidiaries to manage
the overall interest rate risks inherent in various financial assets and liabilities, such as loans and deposits on its derivatives used.
This risk management method is referred to as the “Risk-Adjusted Approach” in “Tentative Accounting and Auditing
Treatment relating to the Adoption of ‘Accounting for Financial Instruments’ for Banks” (JICPA Industry Audit Committee
Report No.15), under which the deferral method of hedge accounting is used. The effectiveness of hedges is assessed by checking (i) whether the total net risk exposure of derivative instruments, used to reduce risk, falls within the risk limit determined in
the risk management policy, and (ii) whether interest risk exposures from hedged items have been reduced.
For certain other assets or liabilities, MHHD applies the deferral method, the fair value method or accrual method specificallyallowed for certain interest rate swaps under the new accounting standard for financial instruments. Under the deferral
method, the recognition of income or expenses arising from a hedging instrument is deferred until the income or expense arising on the hedged items is recognized. Under the fair value method, any changes in the fair value of the hedged item or hedging instrument are recognized as income or expense as incurred.

113

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(6) Translation of Foreign Currencies
Assets and liabilities held by the domestic banking and trust banking subsidiaries that are denominated in foreign currencies aretranslated into yen primarily using the exchange rates prevailing at the balance sheet date, except for investments in non-consolidated subsidiaries and affiliates, which are translated at historical exchange rates. The accounts of overseas branches aretranslated into yen using the exchange rates prevailing at the balance sheet date. Foreign currency assets and liabilities held byother consolidated subsidiaries are translated into yen at the exchange rates prevailing at the end of the fiscal years of therespective subsidiaries.
Until the fiscal year ended March 31, 2001, domestic banking subsidiaries and domestic trust banking subsidiaries had
adopted "New Foreign Accounting Standards," in accordance with the "Tentative Auditing Treatment for the Continuing
Adoption of 'New Foreign Accounting Standards' in Banking Industries"(JICPA April 10, 2000). Effective April 1, 2001, domestic consolidated banking subsidiaries and trust banking subsidiaries adopt the accounting prescribed in "Opinion Concerning
the Amendment of Accounting Standards for Foreign Currency Transactions" (Business Accounting Deliberation Council,
October 22, 1999), excluding the accounting applied based on "Tentative Accounting and Auditing Treatment relating to
Adoption of 'Accounting for Foreign Currency Transaction' for Banks" (JICPA Industry Audit Committee Report No. 20). The
effect of this change was to increase “Other Assets” by ¥3,563 million ($26,746 thousand), “Other Liabilities“ by ¥ 9,086 million ($68,189 thousand), and decrease “Securities” by ¥49 million ($373 thousand), “Foreign Currency Translation
Adjustments” by ¥ 7,671 million ($57,570 thousand) and “Loss before Income Taxes and Minority Interests” by ¥2,099 million($15,754 thousand).
Based on JICPA Industry Audit Committee Report No. 20, either the deferral method or the mark-to-market method forhedge accounting would be used on certain securities denominated in foreign currencies (except for bonds) to hedge theexchange rate risk associated with these securities, if they are (1) designated as the hedged transaction in advance, and (2)there are spot liabilities in the same foreign currency in excess of the securities denominated in a foreign currency.
Fund swap transactions are originated for the purpose of lending and borrowing in different currencies, where (1) thenotional amounts of lending and borrowing are equal to the amounts of foreign exchange purchased or sold as a spot transaction and (2) the amounts of future payment for and proceed from borrowing and lending, respectively, with the contractualinterest payment or receipt denominated in foreign currency, are equal to the amounts of foreign exchange purchased or soldas a forward transaction.
Fund swap transactions are accounted as follows based on JICPA Industry Audit Committee Report No. 20:• Principal amounts of lending/borrowing transactions are translated into yen using the exchange rates in effect at the end of
the fiscal year and the net amount is recorded on the balance sheet.
• Differences arising from different exchange rates applying to the first (spot) and second (forward) legs, are recognized asgains or losses on an accrual basis for the period from the date of the first leg to the second leg.
Currency swap transactions, in which the transactions are (1) originated for the purpose of lending and borrowing in different currencies, (2) amounts payable/receivable at the maturity date are equal to amounts receivable /payable at the contract
date and (3) the swap rates applied to principal and interest are rational, are accounted for as follows based on JICPA Industry
Audit Committee Report No. 20 (These currency swap transactions include transactions that renew one currency’s equivalentamount of principal on every payment day of interest, using the current exchange rate of the day.) :• Principal amounts of lending/borrowing transactions are translated into yen using the exchange rates in effect at the end of
the fiscal year and the net amount is recorded on the balance sheet.
• Interest is recognized as gains or losses on an accrual basis for the period from the date of the first leg to the second leg.
Financial statements of foreign consolidated subsidiaries are translated into yen primarily using the exchange rates in effect at
the end of the fiscal year of these subsidiaries.

114

(7) Premises and Equipment
Depreciation of buildings has been computed mainly by the straight-line method, and that of equipment has been computed
mainly by the declining-balance method with the following range of useful lives:
Buildings
3 years to 65 years
Equipment
2 years to 20 years
Until the fiscal year ended March 31, 2001, a certain domestic banking subsidiary had computed depreciation of installed facilities (e.g. electrical and water facilities), and structures (e.g. signboards and fences), using the declining balance method.
Effective April 1, 2001, the subsidiary has adopted the straight-line method of depreciation, because the usable value of abuilding, etc., remains constant over its useful life and thus depreciating the same amount over its useful life presents periodic
profit and loss more appropriately. The effect of this change was to decrease “Loss before Income Taxes and Minority
Interests” by ¥3,208 million ($24,077 thousand).
MHHD and domestic consolidated subsidiaries changed the estimated useful life for computers from 6 years to 5 years. As aresult of this change, “Loss before Income Taxes and Minority Interests” increased by ¥4,451 million ($33,410 thousand).
(8) Software
Development costs for internally used software are capitalized and amortized under the straight-line method over their estimated useful lives of mainly five years.
(9) Deferred Debenture Charges
Deferred Debenture Charges are amortized as follows:
Debenture discounts are amortized over the term of the debenture.
Debenture issuance costs are amortized over the term of the debentures, up to the maximum of three years, which is thelongest period permitted under the Commercial Code of Japan.
(10) Reserve for Possible Losses on Loans
The Reserve for Possible Losses on Loans of major domestic consolidated subsidiaries is maintained in accordance with internallyestablished standards for write-offs and provisions:• For credits extended to obligors that are legally bankrupt under the Bankruptcy Law, Special Liquidation in the Commercial
Law or other similar laws (“Bankrupt Obligors”), and to obligors that are effectively in similar conditions (“Substantially
Bankrupt Obligors”), reserves are maintained at 100% of amounts of claims net of expected amounts recoverable from thedisposal of collateral and/or the amounts recoverable under guarantees.
• For credits extended to obligors that are not yet legally or formally bankrupt but who are substantially bankrupt, reserves aremaintained at the amount deemed necessary based on overall solvency analyses, on the amount of claims less expectedamounts recoverable from the disposal of collateral and/or the amounts recoverable under guarantees.
• For credits extended to other obligors, reserves are maintained at rates derived from historical credit loss experiences, etc.
• Reserves for Possible Losses on Loans to Restructuring Countries (including Reserves for Losses on Overseas Investments prescribed in Article 55-2 of the Exceptions to the Tax Laws Act) are maintained in order to cover possible losses based on theanalyses of political and economic climates of the countries.
All credits are assessed by each credit origination department, and the results of the assessments are verified and examinedby the independent examination department. Reserves for Possible Losses on Loans are provided for on the basis of such verified assessments.
In the case of loans to bankrupt obligors or substantially bankrupt obligors, who are collateralized or guaranteed by a third
party, the amounts deemed uncollectible are written off against the respective loan balances. The total write-off amounts were
¥3,040,054 million ($22,814,668 thousand) and ¥2,838,028 million at March 31, 2002 and 2001, respectively.
Other consolidated subsidiaries provide the amount necessary to cover the loan losses based upon past experience for generalclaims, and their management’s assessment for other claims.

115

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(11) Reserve for Possible Losses on Securities
The Reserve for Possible Losses on Securities is maintained to provide against possible losses on securities, after taking into consideration the financial conditions and other relevant factors concerning the subject entity.
(12) Reserve for Employee Retirement Benefits
The Reserve for Employee Retirement Benefits, which is provided for future pension payments to employees, is recorded as theamount accrued at the end of the fiscal year, based on the projected benefit obligation and the estimated pension plan asset
amounts at the end of the fiscal year.
Gain on plan amendment is recognized as income in the fiscal year of occurrence.
Unrecognized actuarial gains or losses are recognized as income or expenses from the following fiscal year under the straightline method over a certain term within the average remaining service period of the current employees.
With respect to unrecognized net obligation at the date of initial application of the accounting standard for retirement benefits amounted to ¥351,378 million, ¥144,166 million was expensed due to the establishment of the retirement benefit trust for
the year ended March 31, 2001, and the remainder has been recognized equally as an expense primarily over five years.
The consolidated subsidiaries principally have funded pension plans for their employees.
(13) Reserve for Possible Losses on Loans Sold
The Reserve for Possible Losses on Loans Sold is provided to cover possible losses on loans sold to the Cooperative Credit
Purchasing Company, Limited, taking into account the value of collateral pledged.
(14) Reserve for Possible Losses on Support of Specific Borrowers
The Reserve for Possible Losses on Support of Specific Borrowers is provided to cover losses on write-off of loans to assist or
facilitate the restructuring of certain borrowers.
(15) Lease Transactions
Finance leases of MHHD and domestic consolidated subsidiaries that do not involve the transfer of ownership to the lessee atthe end of the lease term are accounted for as operating leases.
Lease transactions of foreign consolidated subsidiaries are principally accounted for as either capital leases or operatingleases.
(16) Scope of Cash and Cash Equivalents in Consolidated Statement of Cash Flows
In the Consolidated Statements of Cash Flows, Cash and Cash Equivalents consist of cash and due from central banks.
(17) Income Taxes
Deferred income taxes are recorded for the corporate tax, the inhabitants' taxes and the enterprize taxes based on the differences between the tax bases of assets and liabilities and those as reported in the consolidated financial statements, using
enacted tax rates which will be in effect when the differences are expected to reverse. The assets and liabilities method is used
to determine deferred income taxes.
(18) Overseas Repurchase Agreement Transactions
In prior years, overseas repurchase agreement transactions had been classified as “Call Loans and Bills Purchased” and “CallMoney and Bills Sold” or, “Other Assets” and “Other Liabilities.” Effective this fiscal year, these transactions are included in“Receivables under Resale Agreements” or “Payables under Repurchase Agreements” in the amounts of ¥1,757,014 million($13,185,848 thousand) and ¥3,854,805 million ($28,929,124 thousand), respectively.

116

(19) Enterprise Taxes
With the implementation of the “Metropolitan Ordinance regarding the Imposition of Enterprise Taxes through ExternalStandards Taxation on Banks in Tokyo” (Tokyo Metropolitan Ordinance No.145, April 1, 2000) (“the metropolitan ordinance”),
enterprise taxes which were hitherto levied on income are now levied on gyomu ararieki (Gross Profits.)
On October 18, 2000, domestic banking subsidiaries and domestic trust banking subsidiaries filed a lawsuit with the Tokyo
District Court against the Tokyo Metropolitan Government and the Governor of Tokyo seeking to void the metropolitan ordinance. Domestic banking subsidiaries and domestic trust banking subsidiaries won the case eventually entirely on March 26,
2002 with a decision of the Tokyo District Court in domestic banking subsidiaries and domestic trust banking subsidiaries’
favor, on the grounds that the metropolitan ordinance was illegal. The District Court ordered the Metropolitan Government toreturn to domestic banking subsidiaries and domestic trust banking subsidiaries advance tax payments of ¥20,536 million($154,123 thousand) and also awarded to the Bank damages of ¥410 million ($3,077 thousand). On March 29, 2002 theMetropolitan Government lodged an appeal with the Tokyo High Court against the decision.
It is the opinion of domestic banking subsidiaries and domestic trust banking subsidiaries that the metropolitan ordinance isboth unconstitutional and illegal. Domestic banking subsidiaries and domestic trust banking subsidiaries have asserted thisopinion in the courts and the matter is still in litigation. During this term domestic banking subsidiaries and domestic trust
banking subsidiaries have applied the same treatment as in the previous term, accounting for enterprise taxes through external
standards taxation on banks in Tokyo in accordance with the metropolitan ordinance, because domestic banking subsidiaries
and domestic trust banking subsidiaries have deemed it appropriate at this stage to continue with the same accounting treatment as before. This accounting treatment does not constitute in any way an admission on the part of the Bank either of theconstitutionality or of the legality of the metropolitan ordinance.
With the implementation of the municipal ordinance, enterprise taxes relating to banks in Tokyo were recorded in Other
Expenses in the amounts of ¥23,537 million in the previous year, and ¥27,170 million ($203,903 thousand) in the current year.
As a result, there was a respective decrease (increase) in “Income (Loss) before Income Taxes and Minority Interests” as compared with the previous standards under which enterprise taxes were levied on income. Moreover, there was a decrease in“Income Taxes—Current” of ¥3,131 million in the previous year and no effect in the current year as compared with the previous standards under which enterprise taxes were levied on income. Since the enterprise taxes in question are not included in
the calculations for accounting for tax effects, there was a decrease in “Deferred Tax Assets” of ¥154,352 million ($1,158,364
thousand) as compared with the amount that it would have been had the enterprise taxes been levied on income instead ofgross profits. There was also a decrease in “Deferred Tax Liabilities for Revaluation Reserve for Land” of ¥24,522 million($184,035 thousand), an increase in the “Revaluation Reserve for Land, net of Taxes” of ¥24,522 million ($184,035 thousand)and a decrease in “Net Unrealized Losses on Other Securities, net of Taxes” of ¥25,595 million ($192,089 thousand).
With the implementation of the “Revision of Municipal Ordinance regarding the Imposition of the Enterprise Taxes throughExternal Standards Taxation on Banks in Osaka”(Osaka Municipal Ordinance No.77) (“the revised municipal ordinance”) on
May 30, 2002, the special treatment regarding the tax basis is to be applicable from the fiscal year starting on April 1, 2002.
The enterprise taxes which the banks are required to pay to the Osaka municipal government this term are subject to the
supplementary provision 2 of the revised municipal ordinance, which stipulates that the banks shall pay the enterprise taxes
based on the lesser of gyomu ararieki or income. The domestic banking subsidiaries and domestic trust banking subsidiaries,
therefore, filed and paid the enterprise taxes based on income.
The fact that the domestic banking subsidiaries and domestic trust banking subsidiaries filed and paid the enterprise taxes
according to the revised municipal ordinance does not constitute in any way an admission on the part of the domestic banking
subsidiaries and domestic trust banking subsidiaries either of the constitutionality or of the legality of the revised municipal
ordinance as well as the municipal ordinance.
With the implementation of the municipal ordinance, enterprise taxes relating to banks in Osaka were recorded in Other
Expenses in the amounts of ¥4,744 million ($35,603 thousand). As a result, there was an increase in “Loss before Income Taxes
and Minority Interests” of the same amount as compared with the previous standards under which enterprise taxes were leviedon income. Since the enterprise taxes in question are not included in the calculations for accounting for tax effects, there was adecrease in “Deferred Tax Assets” of ¥30,238 million ($226,933 thousand) as compared with the amount that would haveresulted if the enterprise taxes had been levied on income instead of gross profits. There was also a decrease in “Deferred Tax
Liabilities for Revaluation Reserve for Land” of ¥4,521 million ($33,933 thousand), an increase in the “Revaluation Reserve for
Land, net of Taxes” of ¥4,521 million ($33,933 thousand) and a decrease in “Net Unrealized Losses on Other Securities, net of
Taxes” of ¥4,760 million ($35,723 thousand).

117

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(20) Appropriation of Retained Earnings
Cash dividends and bonuses to directors and statutory auditors are recorded in the fiscal year in which the proposed appropriation of Retained Earnings is approved by the Board of Directors and/or by the general meeting of the shareholders.
(21) Net Income (Loss) per ShareNet Income (Loss) per Share is computed based on the weighted-average number of shares of common stock outstanding during
the fiscal year.
Net Income per Share (diluted) is computed based on the average number of shares of common stock outstanding during the
fiscal year, after giving effect to the dilutive potential of the shares of common stock to be issued upon the conversion of preferred stock.
4. Trading Assets and Liabilities
At March 31

Trading Assets:
Trading Securities
Derivatives for Trading Securities
Securities Held to Hedge Trading Transactions
Derivatives for Securities Held to Hedge Trading Transactions
Derivatives for Trading Transactions
Other Trading Assets
Total
Trading Liabilities:
Trading Securities Oversold
Derivatives for Trading Securities
Securities Oversold to Hedge Trading Transactions
Derivatives for Securities Held to Hedge Trading Transactions
Derivatives for Trading Transactions
Total

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 3,437,246
2,638
—
34
2,892,170
1,619,329¥ 6,116,519
2,449
47,602382
2,952,840
1,757,680$ 25,795,471
19,799—262
21,704,844
12,152,565¥ 7,951,419¥ 10,877,475$ 59,672,941¥ 2,138,021
617—
82,745,195¥ 1,425,289
1,402
45,691491
3,214,825$ 16,045,190
4,635
—
63
20,601,840¥ 4,883,842¥ 4,687,700$ 36,651,728

5. Securities
At March 31

Japanese National Government Bonds
Japanese Local Government Bonds
Japanese Corporate Bonds
Japanese Stock and Shares*1
Others*2
Total

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 10,554,751
372,164
1,109,982
6,708,121
5,363,910¥ 11,641,796
476,375
1,126,151
8,391,951
6,426,288$ 79,210,143
2,792,983
8,330,077
50,342,372
40,254,491¥ 24,108,931¥ 28,062,563$ 180,930,066*1 Japanese Stock and Shares included investments in non-consolidated subsidiaries and affiliates which are not accounted for under the equity method of ¥112,468 million ($844,040 thousand) and¥141,211 million at March 31, 2002 and 2001, respectively.
*2 Others included investments in non-consolidated subsidiaries and affiliates which are not accounted for under the equity method of ¥2,640 million ($19,818 thousand) and ¥234,687 million at March
31, 2002 and 2001, respectively.

118

6. Loans and Bills Discounted
Millions of yen
2002

At March 31

Bills Discounted
Loans on Notes
Loans on Deeds
Overdrafts
Financing Receivables, including Factoring, Leasing and Property Financing
Total

¥

1,192,472
10,583,475
55,177,085
17,061,042
579,580¥ 84,593,656

¥

2001

1,278,023
13,167,367
58,106,258
18,593,064
1,142,058¥ 92,286,772

Thousands of U.S. dollars
2002$

8,949,136
79,425,708
414,086,948
128,037,840
4,349,574$ 634,849,206

Loans and Bills Discounted at March 31, 2002 and 2001 include the following:
Millions of yen
2002

At March 31

Loans to Bankrupt Borrowers*1
Non-Accrual Delinquent Loans*2
Loans Past Due for 3 Months or More*3
Restructured Loans*4
Total

¥

639,2692,698,586
69,7552,059,609¥ 5,467,220*5

¥

2001

470,0312,169,692
124,800
1,791,770¥ 4,556,295

Thousands of U.S. dollars
2002$

4,797,522
20,252,054
523,492
15,456,733$ 41,029,801*1 Loans to Bankrupt Borrowers represent non-accrual loans to borrowers who are legally bankrupt as defined in Article 96-1-3 and 4 of the Japanese Tax Law Enforcement Regulation (Article 97 of 1965
Cabinet Order).
*2 Non-Accrual Delinquent Loans represent non-accrual loans other than (i) Bankruptcy Loans and (ii) loans of which payments of interest are deferred in order to assist or facilitate the restructuring ofborrowers in financial difficulties.
*3 Loans to Bankrupt Borrowers or Non-Accrual Delinquent Loans, both of which are classified as non-accrual, are not included in this category.
*4 Restructured Loans represent loans on which contracts were amended in favor of borrowers (e.g., the reduction of or exemption from stated interest, the deferral of interest payments, the extension of
maturity dates, or renunciation of claims) in order to assist or facilitate the restructuring of borrowers in financial difficulties.
*5 ¥2,459 million ($18,459 thousand) of those amounts are placed in administrative trust established by the Resolution and Collection Corporation, which will be finally disposed of.

Commitment Line for Loans

Overdraft protection on current accounts and contracts for the commitment line for loans are contracts by which consolidated
subsidiaries are bound to extend loans up to the prearranged amount, at the request of customers, unless the customer is inbreach of contract conditions. The unutilized balance of these contracts amounts to ¥49,800,033 million ($373,733,836 thousand) as of March 31, 2002. ¥44,154,039 million ($331,362,398 thousand) of these amounts relate to contracts of which originalcontractual terms are of a term of one year or less, or unconditionally cancelable at any time as of March 31, 2002.
Since many of these contracts expire without the rights exercised, the unutilized balance itself does not necessarily affect future
cash flows of MHHD and its consolidated subsidiaries. A provision is included in many of these contracts that entitles the consolidated subsidiaries to refuse the execution of loans, or reduce the maximum amount under contracts when there is a change inthe financial situation, necessity to preserve a claim, or other similar reasons. The consolidated subsidiaries obtain, moreover, realestate or securities as collateral at the time the contracts are entered into, if needed, and subsequently monitor a customer‘s business condition periodically, based on and in accordance with procedures established, and take measures to control credit risks
such as amendments to contracts, if needed.

119Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

7. Foreign Exchange Assets and Liabilities
Millions of yen
2002

2001

Thousands of U.S. dollars
2002

397,398
222,284
25,204542,089¥ 486,300
269,833
7,165
81,978$ 2,982,356
1,668,177
189,148
4,068,217¥ 1,186,977¥ 845,277$ 8,907,898

¥

3,786
24,508131,883
548,053¥$¥

708,231¥ 273,849

At March 31

Foreign Exchange Assets:
Foreign Bills Bought
Foreign Bills Receivable
Advance to Foreign Banks
Due from Banks (Foreign)
Total
Foreign Exchange Liabilities:
Foreign Bills Sold
Foreign Bills Payable
Advance from Foreign Banks
Due to Banks (Foreign)
Total

¥

33,081
27,65475,929137,183

28,417
183,926
989,746
4,112,973$ 5,315,062

8. Other Assets
Millions of yen
2002

At March 31

Accrued Income
Prepaid Expenses
Cash Placed as Collateral on Securities Borrowed
Securities in Custody and Other
Deferred Hedge Losses*1
Derivatives
Others*2
Total¥

358,260
11,706
3,313,727
2,922,552
414,695
1,076,9782,969,846¥ 11,067,767

¥

2001

442,344
97,462
2,785,176
4,787,890
516,356
2,190,966
4,120,529¥ 14,940,725

Thousands of U.S. dollars
2002$

2,688,635
87,852
24,868,500
21,932,852
3,112,158
8,082,389
22,287,781$ 83,060,167*1 Deferred Hedge Losses is net realized or unrealized losses from hedging instruments. The gross amounts of deferred hedge gains and losses before netting are ¥1,357,005 million ($10,183,909
thousand) and ¥1,771,700 million ($13,296,067 thousand), respectively.
*2 Others included provisional tax payments of ¥222,682 million ($1,671,163 thousand) made by IBJ. These payments were made upon receipt of the Correction Notice from the Tokyo Regional Taxation
Bureau (“TRTB”) on August 23, 1996 in connection with the write-off of credits due from Japan Housing Loan, Inc., amounting to ¥376,055 million ($2,822,176 thousand) recorded in the fiscal year
ended March 1996. The subsidiary disputed the rationale for the proposed correction and filed an application seeking to void the proposed correction to the National Tax Tribunal for administrative
review. This was dismissed on October 28, 1997. On October 30, 1997, the subsidiary filed a lawsuit with the Tokyo District Court seeking to void the TRTB’s administrative action against the subsidiaryand won the case entirely on March 2, 2001. However, this was appealed to the Tokyo High Court on March 16, 2001 and the subsidiary lost the case on March 14, 2002. On March 27, 2002, thesubsidiary filed an appeal to the Supreme Court. The subsidiary believes that their claim is appropriate. Nevertheless, the subsidiary accrued Reserve for Contingency amounting to ¥134,203 million($1,007,158 thausand) from the viewpoint of financial soundness and prudent accounting.

9. Premises and Equipment
Millions of yen
2002

At March 31

2001

Thousands of U.S. dollars
2002

Land
Buildings
Equipment
Others¥ 1,072,602
304,707
97,093
279,094¥ 1,093,175
288,300
79,333
252,547$ 8,049,548
2,286,733
728,660
2,094,515

Total¥ 1,753,497¥ 1,713,356$ 13,159,456¥¥$ 6,016,605

Accumulated Depreciation

801,712793,130

10. Deferred Debenture Charges
At March 31

Deferred Discount on Debentures
Deferred Debenture Issuance Costs
Total

120

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 2,555
2,288¥ 7,617
1,913$ 19,175
17,172¥ 4,843¥ 9,531$ 36,347

11. Reserve for Possible Losses on Loans
Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 953,410
962,407
34,001¥ 780,774
817,943
28,914$ 7,155,051
7,222,574
255,169¥ 1,949,819¥1,627,632$14,632,794

At March 31

General Reserve for Possible Losses on Loans
Specific Reserve for Possible Losses on Loans
Reserve for Possible Losses on Loans to Restructuring Countries
Total

12. Assets Pledged as Collateral
The following assets were pledged as collateral:
Millions of yen
2002

At March 31

Cash and Due from Banks
Call Loans and Bills Purchased
Trading Assets
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment

¥

1,932
—
2,344,170
7,881,007
3,684,370
5,189
582,926
92

¥

2001

1,761
50,0001,002,499
7,473,073
3,273,799—
344,964
136

Thousands of U.S. dollars
2002$

14,501—
17,592,276
59,144,520
27,650,058
38,942
4,374,684
698

The following liabilities were collateralized by the above assets:
Millions of yen
2002

At March 31

Deposits
Call Money and Bills Sold
Payables under Repurchase Agreements
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities¥

474,581
4,482,500
2,522,239
194,273
524,963
14,19744,223¥

2001

452,9445,870,347—
235,254
77,274—64,898

Thousands of U.S. dollars
2002$

3,561,591
33,639,775
18,928,626
1,457,966
3,939,688
106,550
331,885

In addition, Borrowed Money amounting to ¥2,642 million ($19,832 thousand) was collateralized by stocks which aredeposited by customers as collateral for loan transactions in relation to sales of securities as of March 31, 2002. In addition, thesettlement accounts of foreign currency transactions or margins for futures transactions are collateralized or substituted by Cashand Due from Banks of ¥64,198 million ($481,786 thousand), Trading Assets of ¥24,921 million ($187,031 thousand), Securitiesof ¥3,014,626 million ($22,623,836 thousand), Loans and Bills Discounted of ¥187,310million ($1,405,706 thousand) and Other
Assets of ¥20,169 million ($151,367 thousand) as of March 31, 2002. None of the assets are pledged as collateral in connection
with borrowings by the unconsolidated subsidiaries and the affiliates.
Guarantee deposits amounting to ¥158,473 million ($1,189,294 thousand) were included in Premises and Equipment. Margins
for futures transactions amounting to ¥51,809 million ($388,815 thousand) and margins on securities borrowed amounting to¥3,313,727 million ($24,868,500 thousand) were included in Other Assets as of March 31, 2002.

13. Deposits
At March 31

Current Deposits
Ordinary Deposits
Deposits at NoticeTime Deposits
Certificates of Deposit
Others
Total

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 5,828,661
29,170,849
2,059,880
31,222,513
11,476,779
5,847,551¥ 4,902,910
17,662,700
1,935,274
37,020,164
12,851,673
5,803,760$ 43,742,299
218,918,193
15,458,766
234,315,296
86,129,676
43,884,067¥ 85,606,235¥ 80,176,482$ 642,448,297

121

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

14. Debentures
IBJ issues debentures twice a month and offers them to institutional and private investors as a main source of funds for its operations. It provides debentures with a variety of different terms in order to attract more investors.
At March 31
Description of Debentures

Millions of yen
2002

2001

One-Year Discount Debentures¥ 3,962,829[3,962,829]¥ 5,388,567[5,388,567]

One-Year Discount Debentures(custody only)

266,959[266,959]

Five-Year Coupon Debentures(Series A)

Thousands of U.S. dollars
2002

2001

29,739,812[29,739,812]

0.08%–0.14% 0.11%–0.34%

400
[400]

2,003,446[2,003,446]

0.06%–0.11%

8,693,170[2,010,420]

9,478,533[2,169,188]

65,239,550[15,087,580]

0.65%–2.20% 1.00%–2.70%

Five-Year Coupon Debentures(Series B)

154,229[37,093]

198,578[52,441]

1,157,447[278,376]

0.16%–1.70% 0.20%–2.30%

Five-Year Coupon Debentures(with compounding interests)

852,093[160,433]

940,695[209,228]

6,394,695[1,204,002]

0.16%–1.70% 0.20%–2.30%

Five-Year Coupon Debentures(savings-type)774,408[100,519]

802,892[109,821]

5,811,699[754,370]

0.16%–1.70% 0.20%–2.30%

Five-Year Coupon Debentures(savings-type with compounding interests)

91,193[15,445]

93,158[16,380]

684,375[115,911]

0.16%–1.70% 0.20%–2.30%

Two-year Coupon Debentures

473,000[319,800]

917,900[598,100]

3,549,719[2,400,000]

0.35%–0.75% 0.30%–0.75%

Three-year Coupon Debentures

15,000[—]—[—]112,570[—]

28,006[—](US$75,000)

27,531[—](US$85,000)

210,182[—](US$75,000)¥15,310,890¥ 17,848,257$ 114,903,495

Debentures Denominatedin Foreign Currencies
Total

$

Interest rates
2002

0.09%

0.06%

—%

2.54%–9.37% 3.60%–9.37%

Notes: 1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amount of foreign currency denominated bonds is shown in original currency in parentheses ( ).
3. Repayments for Debentures are scheduled for the next five years as follows:
Fiscal 2002 ¥6,873,500 million ($51,583,494 thousand)2003 ¥2,294,077 million ($17,216,338 thousand)2004 ¥2,068,350 million ($15,522,331 thousand)2005 ¥2,169,575 million ($16,281,990 thousand)2006 ¥1,899,387 million ($14,254,312 thousand)4. No collateral was provided for the above Debentures.

15. Call Money and Bills Sold
Millions of yen
2002

At March 31

2001

Thousands of U.S. dollars
2002

Call Money
Bills Sold

¥ 7,329,547
2,124,144¥ 11,810,988
1,397,087$ 55,005,986
15,941,046

Total¥ 9,453,692¥ 13,208,076$ 70,947,032

16. Commercial Paper
At March 31

Commercial Paper

Millions of yen
2002¥ 711,382

2001

Thousands of U.S. dollars
2002¥ 2,369,254$ 5,338,702*1 The average interest rates are the weighted-average interest rate of debts calculated from the interest rates and outstanding balances at the end of the year.

122

Average Interest rates*1
2002
2001

0.30%

1.72%

17. Borrowed Money
Millions of yen
2002

At March 31

Bills Rediscounted
Other Borrowings*2,3

¥

Total

2001

Thousands of U.S. dollars
2002

Average Interest rates*1
2002
2001

8,975
2,544,406¥ 10,680
3,861,264$

67,361
19,094,982

4.45%
2.65

5.21%
3.56

¥ 2,553,382¥3,871,945$ 19,162,343

2.66%

3.57%

*1 Average interest rates are weighted-average interest rates of debts calculated from the interest rates and outstanding balances at the end of theyear.
*2 Other Borrowings included subordinated debt of ¥1,728,891 million ($12,974,796 thousand) and ¥2,261,707 million at March 31, 2002 and2001, respectively.
*3 Repayments for Other Borrowings are scheduled for the next five years as follows:
Fiscal 2002 ¥1,226,619 million ($9,205,399 thousand)2003 ¥ 23,223 million ($ 174,288 thousand)2004 ¥ 201,885 million ($1,515,089 thousand)2005 ¥ 274,485 million ($2,059,931 thousand)2006 ¥ 77,522 million ($ 581,782 thousand)

18. Bonds and Notes
Major components of Bonds and Notes at March 31, 2002 were as follows:
IssuerDescription

Issue

Millions of yen

Thousands of U.S. dollars

Interest rates

Due

Mizuho Holdings

Straight Bonds

Nov. 2000¥ 850,000[—]$ 6,378,987[—]

0.64%–1.19%

Mar. 2008–*1

Straight Bonds

Mar. 1998–
Aug. 2001

177,900[—]

1,335,084[—]

1.33%–2.54%

Dec. 2010–*2

Straight Bonds

Sept. 1997

3,100
[—]

23,265[—]

3.00%

Nov. 2012*3

Straight Bonds

Dec. 1991–
Nov. 2001

672,314[1,319](US$208,000)(GBP 7,000)

5,045,508[9,899]0.00%–5.19%

Feb. 2002–*4

Straight Bonds

Nov. 1994–
Sep. 2001

693,011[1,294](US$1,741,500)

5,200,833[9,714]

0.36%–8.62%

Jan. 2002–*5

Straight Bonds

Jun. 1989–
Dec. 2001

570,522[75,775](US$357,591)(EUR 9,130)

4,281,591[568,671]

0.10%–8.80%

Apr. 2002–¥ 2,966,847$ 22,265,268

Total

Notes:1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amount of foreign currency denominated bonds is shown in the original currencies in brackets ( ).
3. Repayments for Bonds and Notes are scheduled for the next five years as follows:
Fiscal 2002
¥77,069 million ($578,385 thousand)
2003¥14,952 million ($112,215 thousand)
2004¥35,295 million ($264,881 thousand)2005¥ 8,312 million ($ 62,379 thousand)2006¥25,392 million ($190,567 thousand)4. Bonds and Notes at March 31, 2002 included subordinated bonds and notes of ¥2,790,850 million ($20,944,472 thousand).
*1 indicates the total amount of straight bonds issued by the domestic consolidated subsidiary, The Yasuda Trust and Banking Company, Ltd.
*2 indicates the amount of straight bonds issued by IBJ.
*3 indicates the total amount of straight bonds issued by overseas consolidated subsidiaries such as DKB Finance (Aruba) A.E.C., Dai-Ichi Kangyo Australia Ltd., DKB Asia Ltd. and others.
*4 indicates the total amount of straight bonds issued by overseas consolidated subsidiaries such as The Fuji Bank and Trust Company, Fuji International Finance (Australia) Ltd.,YTB Finance (Aruba) A.E.C., and Fuji Finance (Cayman) Ltd.
*5 indicates the total amount of straight bonds issued by overseas consolidated subsidiaries such as Mizuho Finance (Curaço) N.V. (former The Industrial Bank of Japan Finance
Company N.V.), Mizuho International plc, Ltd.

123

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

19. Convertible Bonds
Convertible Bonds at March 31, 2002 were as follows:
Issuer*Description of Debentures

Issue

Millions of yen

Convertible Bonds

Sep. 1987–
Jul. 1988¥8,432[4,519](US$63,280)

Thousands of
U.S. dollars$63,280[33,920]

Interest rates

Due

1.75%–2.87%

Sep. 2002–
Sep. 2003

Notes:1. Figures indicated in brackets [ ] represent the amounts to be redeemed within one year.
2. The amount of foreign currency denominated bonds is shown in the original currency in brackets ( ).
3. * indicates the total amount of convertible bonds issued by the domestic consolidated subsidiary The Yasuda Trust and Banking Company, Ltd.
4. Details are as follows:
Conversion
Description
Convertible Period
price
Issuing share
Capitalization
US$ denominated convertible bonds due Sept. 30, 2002
Oct. 1, 1987–Sept. 20, 2002
¥2,163.90
Common stock¥1,082/share
US$ denominated convertible bonds due Sept. 30, 2003
Aug. 15, 1988–Sept. 22, 2003
¥1,814.90
Common stock¥ 908/share
5. Repayments for Convertible Bonds are scheduled for the next five years as follows:
Fiscal 2002
¥ 4,519 million($33,920 thousand)2003¥ 3,912 million($29,360 thousand)2004¥— million($— thousand)2005¥— million($— thousand)2006¥— million($— thousand)

20. Other Liabilities
Millions of yen
2002

At March 31

Accrued Expenses
Unearned Income
Income Taxes Payable
Cash Received as Collateral on Securities Lent
Securities Borrowed
Derivatives
OthersTotal¥

338,930
180,927
76,3494,050,050
2,814,054
1,203,042
2,614,829¥ 11,278,184

¥

2001

477,474
206,898
91,973
4,605,260
4,474,393
2,143,396
9,187,445¥ 21,186,842

Thousands of U.S. dollars
2002$

2,543,569
1,357,805
572,981
30,394,375
21,118,607
9,028,459
19,623,489$ 84,639,285

21. Reserve for Bonus Payments
Reserve for Bonus Payments, which is provided for future bonus payments to employees, is maintained at the amount accrued at
the end of the fiscal year, based on the estimated future payments and service periods.
Until the fiscal year ended March 31, 2001, accrued liabilities for bonus payments to employees had been recorded in accrued
expenses included in “Other Liabilities.” Effective April 1, 2001, they are recorded as “Reserve for Bonus Payments” in accordance with “Concerning Financial Statement Titles to Be Used for Accrued Bonuses for Employees” (JICPA Research Center
Review Information No.15). The effect of this change was to decrease Accrued Expenses included in “Other Liabilities” by¥21,801 million ($163,615 thousands) and increase “Reserve for Bonus Payments” by ¥21,801 million ($163,615 thousands) asof March 31, 2002.

124

22. Reserve for Employee Retirement Benefits(1) Employees of major domestic consolidated subsidiaries are entitled, with some conditions, to receive lump-sum indemnities orannuity payments for life upon their termination of employment. The amount of the benefits is determined by the current rateof pay, length of service and the conditions under which their termination occurs.
The major domestic consolidated subsidiaries have contributory funded defined benefit pension plans under the Japanese
Welfare Pension Insurance Law (the “JWPIL”) and which are qualified by the tax authority and severance indemnity plans. The
pension plans under the JWPIL cover a portion of the governmental welfare pension program, under which the contributions
are made by such subsidiaries and their employees.
Certain domestic consolidated banking subsidiaries established self-insured pension plans .
In addition, domestic banking and certain trust banking consolidated subsidiaries established employee retirement benefit
trusts.
(2) Reserve for Employee Retirement Benefits was reconciled as follows:
Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ (1,370,677)
1,087,697¥ (1,331,938)
989,281$ (10,286,510)
8,162,832

Unfunded Retirement Benefit Obligations
Unrecognized Net Obligation at Date of Initial Application
Unrecognized Actuarial Differences(282,980)
123,516
386,566(342,656)
165,714141,722(2,123,678)
926,951
2,901,060

Net Amounts
Prepaid Pension Cost
Other Liabilities

227,102
263,721—(35,220)
91,027(196)

1,704,333
1,979,151—

At March 31

Projected Benefit Obligations
Plan Assets

Reserve for Employee Retirement Benefits¥(36,619)¥(126,050)$(274,818)

Note: The above Projected Benefit Obligations includes the governmental welfare program, but does not include additional retirement benefits paid
to their employees.
It also includes the amount measured by certain consolidated subsidiaries under the non-actuarial method.

(3) Breakdown of Pension Expenses was as follows:
Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 40,019
46,193(41,188)(104,493)
13,78941,9283,796¥ 37,666
45,411(36,610)—316
185,8162,017$ 300,336
346,669(309,106)(784,191)
103,489
314,661
28,489¥¥ 234,618$

For the Fiscal Years ended March 31

Service Cost*1
Interest Cost
Expected Return on Plan Assets
Gain on Plan Amendment
Amortization of Actuarial Differences
Amortization of Unrecognized Net Obligation at Date of Initial Application*2
Others (such as Extra Retirement Benefit)
Net Pension Expenses

46

347

*1 Retirement expenses of some consolidated subsidiaries which adopt the simplified method for calculating projected benefit obligations are included in Service Cost in full.
*2 Amortized projected benefit obligations at the date of initial application arising from the establishment of the retirement benefit trust amounting to ¥144,166 million is included in the amount for theyear ended March 31, 2001.

(4) Assumptions used in calculation of the above information were as follows:
Discount rate
Expected rate of return on plan assets
Method of attributing the projected benefits to periods of services
Gain on Plan Amendment
Amortization of unrecognized actuarial differences
Amortization of unrecognized net obligation at date of initial application

2002
2.1–3.0%
1.0–7.8%
Straight-line basis
Charged to Incomein the year
1–15 years
Primarily 5 years

2001
2.5–7.7%
1.0–9.0%
Straight-line basis—
1–15 years
Primarily 5 years

125Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

23. Other Reserves
Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 134,203
126824¥ 24,032
104603$ 1,007,158
946
6,188

¥ 135,154¥ 24,740$ 1,014,292

At March 31

Reserve for Contingencies*1
Reserve for Contingent Liabilities from Futures Transactions
Reserve for Contingent Liabilities from Securities Transactions
Total*1 Reserve for Contingencies is maintained to cover losses arising from matters not covered by other specific reserves that are probable to take place and that are determinable in amounts.

24. Acceptances and Guarantees(1) All commitments and contingent liabilities of a material nature resulting from guarantees or otherwise are included in the contra-accounts “Acceptances and Guarantees” and “Customers’ Liabilities for Acceptances and Guarantees.”
The outstanding balance of the accounts were as follows:
Millions of yen
2002

At March 31

Acceptances
Letters of Credit
Guarantees

¥

Total

40,779628,228
4,254,235¥ 4,923,244

¥

2001

33,281
683,543
5,412,816¥ 6,129,641

Thousands of U.S. dollars
2002$

306,040
4,714,661
31,926,723$ 36,947,424(2) The principal amounts indemnified for jointly operated designated money trusts and loan trusts, which are entrusted todomestic consolidated trust banking subsidiaries, were ¥787,064 million ($5,906,675 thousand) and ¥1,692,267 million($12,699,945 thousand) as of March 31, 2002 and ¥665,796 million and ¥2,394,557 million as of March 31, 2001, respectively.

25. Revaluation of Land
In accordance with the Land Revaluation Law, land used for business operations of domestic consolidated banking subsidiaries
was revalued on March 31, 1998. In accordance with Article 119 of the 1998 Cabinet Order Article 2-4 of the Enforcement
Ordinance relating to the Land Revaluation Law, the revaluation was performed by the method of calculating the value alongwith reasonable adjustments, such as for the condition of the land.
The income tax on the entire excess of revaluation is included in Deferred Tax Liabilities for Revaluation Reserve for Land, andthe remainder, net of the tax, is stated as Revaluation Reserve for Land in Shareholders’ Equity.
The difference at the balance sheet date between the total fair value of land for business operation purposes, which has beenrevalued in accordance with Article 10 of the above-mentioned law, and the total book value of the land after such revaluation is¥228,488 million ($1,714,734 thousand). Similar treatment has been adopted for certain consolidated overseas subsidiaries.

26. Common Stock and Preferred Stock
Common Stock and Preferred Stock at March 31, 2002 were as follows:
Number of sharesClass of stock

Common StockFirst Series Class I Preferred Stock
Second Series Class II Preferred Stock
Third Series Class III Preferred Stock
Fourth Series Class IV Preferred Stock
Fifth Series Class V Preferred Stock
Sixth Series Class VI Preferred Stock
Seventh Series Class VII Preferred Stock
Eighth Series Class VIII Preferred Stock
Ninth Series Class IX Preferred Stock
Tenth Series Class X Preferred Stock

Authorized

Issued andoutstanding

25,000,000
33,000100,000
100,000
150,000/
150,000
125,000
125,000
140,000
140,000

9,430,250.71
33,000100,000
100,000
150,000/
150,000
125,000
125,000
140,000
140,000

Per share (Yen)InterimYear-end
cash dividend cash dividend¥

Note : All the outstanding of Fifth Series Class V Preferred Stock was converted into Common Stock on February 1, 2002.

126

—
—
—
—
—
—
—
—
—
—
—

With
Liquidation Convertible redemption
value
or notor not¥ 3,500 ¥—22,500 3,000,000
8,200 2,000,000
14,000 2,000,000
47,600 2,000,000//
42,000 2,000,000
11,000 2,000,000
8,000 2,000,000
17,500 1,250,000
5,380 1,250,000

—
*
*
*
—
/
—
*
*
*
*

—
—
—
—
*
/
*
*
*
—
—

Holders or registered pledgees of Preferred Shares are entitled to receive annual dividends, and distribution of residual assets of
MHHD, as set out above in priority to holders of the Shares but pari passu among themselves.
MHHD may pay up to one-half of the annual dividend payable on each class of Preferred Shares as an interim dividend.
Dividends on the Preferred Shares are not cumulative. Holders of Preferred Shares are not entitled to vote at a general meeting ofshareholders except where the law entitles holders of Preferred Shares to vote.

All Preferred Shares except Class IV Preferred Shares and Class VI Preferred Shares are convertible into Common Shares at theoption of the holder. Material terms and conditions of conversion are as follows:
Conversion period*1

Conversion ratio*2

First Series Class I
Preferred Shares

September 29, 2000 to
July 31, 2005

4,000 to be reset on August 1 every year (each, a “Reset Date”) as¥3,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the Tokyo Stock Exchange (the “TSE”) for the 30 consecutive trading
days (excluding trading days on which no closing price, closing bid or offered priceis reported) commencing on the 45th trading day prior to the Reset Date, provided
that the reset conversion ratio shall be neither less than the conversion ratio
applicable on the date immediately prior to the Reset Date nor more than 4.000.

Second Series Class II
Preferred Shares

August 1, 2004 toJuly 31, 2006

¥2,000,000/(current market price x 1.025), where the current market price is thehigher of (x) the average price of daily closing prices (including closing bid oroffered price) of Shares as reported by the TSE for the 30 consecutive trading days
(excluding trading days on which no closing price, closing bid or offered price isreported) commencing on the 45th trading day prior to August 1, 2004 and (y)¥637,600, to be reset on August 1, 2005 using the same formula mutatis mutandis.

Third Series Class III
Preferred Shares

August 1, 2005 toJuly 31, 2008

¥2,000,000/(current market price x 1.025), where the current market price is thehigher of (x) the average price of daily closing prices (including closing bid oroffered price) of Shares as reported by the TSE for the 30 consecutive trading days
(excluding trading days on which no closing price, closing bid or offered price isreported) commencing on the 45th trading day prior to August 1, 2005 and (y)¥637,600, to be reset on August 1, 2006 and August 1, 2007 using the same formula mutatis mutandis.

Seventh Series Class
VII Preferred Shares

October 1, 2006 to
January 31, 2011

¥2,000,000/(conversion price), where the conversion price is the higher of (x) the
average price of daily closing prices (including closing bid or offered price) of
Shares as reported by the TSE for the 30 consecutive trading days (excluding trading days on which no closing price, closing bid or offered price is reported) commencing on the 45th trading day prior to October 1, 2006 multiplied by 1.025
and (y) ¥420,000; to be reset on October 1 of each year between 2007 and 2010
(each, a “Reset Date”) as ¥2,000,000/(conversion price), where the conversion
price is the lower of (x) the average price of daily closing prices (including closing
bid or offered price) of Shares as reported by the TSE for the 30 consecutive trading days (excluding trading days on which no closing price, closing bid or offeredprice is reported) commencing on the 45th trading day prior to the Reset Date and(y) the conversion price effective as of the Reset Date, provided that the conversion price shall not be less than 80% of the initial conversion price.

127

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

Eighth Series ClassVIII Preferred Shares

October 1, 2004 to
January 31, 2009

¥2,000,000/(conversion price), where the conversion price is the higher of (x) the
average price of daily closing prices (including closing bid or offered price) of
Shares as reported by the TSE for the 30 consecutive trading days (excluding trading days on which no closing price, closing bid or offered price is reported) commencing on the 45th trading day prior to October 1, 2004 multiplied by 1.025 and(y) ¥540,000; to be reset on October 1 of each year between 2005 and 2008
(each, a “Reset Date”) as ¥2,000,000/(conversion price), where the conversion
price is the lower of (x) the average price of daily closing prices (including closing
bid or offered price) of Shares as reported by the TSE for the 30 consecutive trading days (excluding trading days on which no closing price, closing bid or offeredprice is reported) commencing on the 45th trading day prior to the Reset Date and(y) the conversion price effective as of the Reset Date, provided that the conversion
price shall not be less than 70% of the initial conversion price.

Ninth Series Class IX September 1, 2003 to
Preferred Shares
August 31, 2009

¥1,250,000/(conversion price), where the conversion price is the higher of (x) the
average price of daily closing prices (including closing bid or offered price) of
Shares as reported by the TSE for the 30 consecutive trading days (excluding trading days on which no closing price, closing bid or offered price is reported) commencing on the 45th trading day prior to September 1, 2003 multiplied by 1.025
and (y) ¥331,000; to be reset on September 1 of each year between 2004 and2008 using the same formula mutatis mutandis.

Tenth Series Class X
Preferred Shares¥565,000 to be reset on September 1 of each year between 2003 and 2008 (each,a “Reset Date”) as ¥1,250,000/(conversion price), where the conversion price is thehigher of (x) the average price of daily closing prices (including closing bid oroffered price) of Shares as reported by the TSE for the 30 consecutive trading days
(excluding trading days on which no closing price, closing bid or offered price isreported) commencing on the 45th trading day prior to the Reset Date multipliedby 1.025 and (y) ¥331,000.

July 1, 2003 toAugust 31, 2009

Notes: 1. If the date to determine the shareholders entitled to exercise their voting rights at a general meeting of the shareholders of MHHD (the “Record Date”) is prescribed, the period from andincluding the date immediately following such Record Date to and including the date on which such general meeting is concluded shall be excluded.
2. Subject to adjustment, where allotment of new Shares for a subscription price below the “current market price” or “conversion price”, a stock split, allotment of securities convertible into Sharesat a conversion ratio more favorable than the Preferred Shares, merger or amalgamation, or a capital decrease or consolidation occurs and in certain other circumstances.

Each Preferred Share which has not been converted as described above by the end of the relevant conversion period will be
converted into Shares on the day following the end of the conversion period on the following terms:
First Series Class I
Preferred Shares

128

August 1, 2005

¥3,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to August 1, 2005, provided that the conversion ratio shallnot be more than 4.000 (1).

Second Series Class II August 1, 2006
Preferred Shares¥2,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to August 1, 2006, provided that the conversion ratio shallnot be more than 3.137 (1).

Third Series Class III
Preferred Shares

August 1, 2008

¥2,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to August 1, 2008, provided that the conversion ratio shallnot be more than 3.137 (1).

Seventh Series Class VII
Preferred Shares

February 1, 2011

¥2,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to February 1, 2011, provided that the conversion ratio shallnot be more than the figure obtained by dividing ¥2,000,000 by the higher of theamount equal to 60% of the amount obtained by dividing ¥2,000,000 by the initial conversion ratio or the par value of Shares.

Eighth Series Class VIII
Preferred Shares

February 1, 2009

¥2,000,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to February 1, 2009, provided that the conversion ratio shallnot be more than the figure obtained by dividing ¥2,000,000 by the higher of theamount equal to 60% of the amount obtained by dividing ¥2,000,000 by the initial conversion ratio or the par value of Shares.

Ninth Series Class IX
Preferred Shares

September 1, 2009

¥1,250,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to September 1, 2009, provided that the conversion ratio
shall not be more than the number obtained by dividing ¥1,250,000 by the higherof ¥331,000 or the par value of the Shares.

Tenth Series Class X
Preferred Shares

September 1, 2009

¥1,250,000/(current market price), where the current market price is the average
price of daily closing prices (including closing bid or offered price) of Shares asreported by the TSE for the 30 consecutive trading days (excluding trading days on
which no closing price, closing bid or offered price is reported) commencing on the
45th trading day prior to September 1, 2009, provided that the conversion ratio
shall not be more than the number obtained by dividing ¥1,250,000 by the higherof ¥331,000 or the par value of the Shares.

* Subject to adjustment, where a stock split or consolidation of share capital occurs.

129Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

27. Interest Income and Interest Expenses
For the Fiscal Years ended March 31

Interest Income:Loans and Bills Discounted
Securities
Call Loans and Bills Purchased
Due from Banks
Receivables under Resale Agreements
Other Interest Income
Total
Interest Expenses:
Deposits
Debentures
Amortization of Debenture Charges
Call Money and Bills Sold
Payables under Repurchase Agreements
Commercial Paper
Borrowed Money
Bonds and Notes
Convertible Bonds
Other Interest Expenses

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 2,059,125
516,308
16,648105,905
261,61660,884¥2,472,492
451,472
342,679
137,942—
107,685$ 15,453,099
3,874,737
124,944794,788
1,963,348
456,9213,020,489

3,512,272

22,667,837

498,640
160,011
10,38832,535
348,619
19,51994,078
169,702233
159,147

817,917
207,599
14,047
478,666—
35,390116,958
173,959218
313,5443,742,146
1,200,835
77,959244,166
2,616,284
146,486
706,030
1,273,563
1,751
1,194,354

Total

1,492,876

2,158,303

11,203,574

Net¥ 1,527,613¥ 1,353,969$ 11,464,263

28. Trading Income
For the Fiscal Years ended March 31

Trading Income:Net Gains on Trading Securities and Derivatives
Net Gains on Securities Held to Hedge Trading Transactions
Net Gains on Derivatives for Trading Transactions
Other Trading Income
Total

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 28,935
6,868
139,9153,165¥ 22,350
10,029119,467
4,662$

217,155
51,543
1,050,024
23,752¥ 178,884¥ 156,508$ 1,342,474

29. Other Operating Income
For the Fiscal Years ended March 31

Gains on Foreign Exchange Transactions
Gains on Sales of Bonds
Others
Total

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 90,930
192,731367,372¥ 22,754
198,171356,199$ 682,407
1,446,394
2,757,019¥ 651,035¥577,125$ 4,885,820

30. Other Income
For the Fiscal Years ended March 31

Gains on Sales of Stock and Other Securities
Gains on Money Held in Trust
Gains on Sales of Premises and Equipment
Equity in Income from Investment in Affiliates
Recovery on Written-off Claims
Gains on Securities Contributed to Employee Retirement Benefit Trust
Gains on Amendment of Employee Retirement Benefit Plan
Others
Total
130

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 552,834
2,253
3,003
—
25,91090,614
104,493
87,390¥ 706,968
6,175
3,386
18,036
16,471
85,681—
252,809$ 4,148,849
16,913
22,538—
194,453
680,031
784,192
655,837¥ 866,499¥1,089,530$ 6,502,813

31. Other Operating Expenses
Millions of yen
2002

For the Fiscal Years ended March 31

Amortization of Debenture Issuance Costs
Losses on Sales of Bonds
Losses on Redemption of Bonds
Losses on Devaluation of Bonds
Others

¥

Total

4,096
113,028
1,142
7,043
325,731¥¥ 451,041

2001

Thousands of U.S. dollars
2002

4,646
64,48967781
361,335$¥ 431,320

30,742
848,245
8,575
52,8572,444,511$ 3,384,930

32. Other Expenses
Millions of yen
2002

2001

Thousands of U.S. dollars
2002

289,823
376,615
46,724
140,672
15,31940,150—$ 6,860,986
9,660,542
424,428
2,853,945
148,218
265,673
50,82041,928131,216
512,076

185,816—
435,039

314,664
984,738
3,842,973¥ 3,385,481¥ 1,530,161$ 25,406,987

For the Fiscal Years ended March 31

Provision of Reserve for Possible Losses on Loans
Write-offs of Claims
Losses on Sales of Stocks and Other Securities
Losses on Devaluation of Stocks and Other Securities
Losses on Money Held in Trust
Losses on Dispositions of Premises and Equipment
Equity in Losses from Investment in Affiliates
Amortization of Unrecognized Net Obligation at Date of Initial Applicationof the Accounting Standard for Employee Retirement Benefits
Transfer to Reserve for Contingencies
OthersTotal¥

914,226
1,287,267
56,555380,288
19,75035,400
6,771¥

Others included the following losses:
For the Fiscal Years ended March 31

Provision of Reserve for Possible Losses on Loans Sold
Provision of Reserve for Possible Losses on Support of Specific Borrowers

Millions of yen
2002¥ 15,986—

2001

Thousands of U.S. dollars
2002¥ 52,472
43,421$ 119,975—

33. Cash Flows
Cash and Cash Equivalents reconciles to Cash and Due from Banks on the Consolidated Balance Sheets as follows:
At March 31

Cash and Due from Banks
Less: Due from Banks except for due from Central Banks
Cash and Cash Equivalents

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 11,720,134(1,872,768)¥ 5,011,232(2,791,427)$ 87,955,983(14,054,546 )¥ 9,847,366¥ 2,219,805$ 73,901,437

Breakdown of selected assets and liabilities relating to Heller Financial, Inc. excluded as a result of its sale are as follows
Millions of yen

Thousands of U.S. dollars

2,695,729
2,139,457(2,356,750)(951,370)(207,213)
5,100
(599)
225,658

20,230,615
16,055,969(17,686,683)(7,139,738)(1,555,073)
38,280(4,501)
1,693,500

Amount of Stocks Sold
Cash and Cash Equivalents of Heller Financial, Inc.

361,925(44,360)

2,716,138(332,913)

Net Revenue related to the sales

317,564

2,383,225

Assets(of which Loans and Bills Discounted)
Liabilities(of which Borrowed Money)
Minority Interest
Foreign Currency Translation Adjustment
Net Unrealized Losses on Other Securities, net of Taxes
Gains on Sales of Stocks

131Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

34. Lease Transactions
Finance Leases
Lessees:

The Acquisition Cost Equivalents, Accumulated Depreciation Equivalents and Book Value equivalents relating to finance leasetransactions accounted for as operating leases were summarized as follows:
Millions of yen

At March 31

Equipment

2002
Others

Total

Equipment

2001
OthersAcquisition Cost Equivalents
Accumulated Depreciation Equivalents¥ 75,395
39,677¥ 1,964
1,163¥ 77,360
40,840¥ 66,254
36,334¥ 1,905
1,119¥ 68,159
37,454

Book Value Equivalents¥ 35,718¥¥ 36,519¥ 29,919¥¥ 30,705

801

785

Total

Thousands of U.S. dollars

At March 31

Equipment

2002
OthersAcquisition Cost Equivalents
Accumulated Depreciation Equivalents$ 565,823
297,769$ 14,743
8,730$ 580,566
306,499

Book Value Equivalents$ 268,054$ 6,013$ 274,067

Total

Future lease payments subsequent to the end of the fiscal year for finance leases accounted for as operating leases (including
the interest portion thereon) were summarized as follows:
Millions of yen
2002

At March 31

Due in One Year or Less
Due after One Year
Total

2001

Thousands of U.S. dollars
2002¥ 12,866
38,221¥ 9,755
35,755$ 96,561
286,839¥ 51,088¥ 45,511$ 383,400

Lease expense, depreciation equivalents and interest expense equivalents relating to finance leases accounted for as operatingleases for the fiscal year ended March 31, 2002 amounted to ¥11,746 million ($88,153 thousand), ¥14,473 million ($108,620
thousand), and ¥1,139 million ($8,549 thousand), respectively. The corresponding amounts for the fiscal year ended March 31,
2001 were ¥11,606 million, ¥12,928 million and ¥1,347 million, respectively.
Notes: 1. The computing method for the amount of depreciation equivalents is as follows:
Depreciation equivalents are calculated by the declining-balance method, computed by multiplying the amounts by 10/9, which itself iscomputed assuming that the useful life is the lease term and that the residual value at the end of the lease term is 10% of the acquisitioncost.
2. The computing method for the amount of interest expenses equivalents is as follows:
The amounts are defined as the difference between total lease payments and acquisition equivalents, which are allocated over the leaseterm by the interest method.

Lessors:

The Acquisition Cost, Accumulated Depreciation and Book Value relating to finance lease transactions accounted for as operatingleases were summarized as follows:
Millions of yen

At March 31

2001
OthersEquipment

Total

Acquisition Cost
Accumulated Depreciation¥ 1,014,188
511,183¥ 2,008 ¥ 1,016,196
1,289
512,473

Book Value¥¥

503,004718 ¥ 503,723

Note: Since the subsidiaries, which had been leasing property to customers, were excluded from the scope of consolidation during the year ended
March 31, 2002, no disclosure information relevant to lessors existed as of March 31, 2002.

Future lease payments to be received subsequent to March 31, 2001 for finance leases accounted for as operating leases(including the interest portion thereon) were summarized as follows:
Millions of yen

At March 31

Due in One Year or Less
Due after One Year
Total
132

2001

¥ 179,302
348,991¥ 528,293

¥210,034 million of the above future lease payments to be received are pledged as collateral as of March 31, 2001.
Lease income, depreciation and interest income equivalents relating to finance leases accounted for as operating leases for the
fiscal year ended March 31, 2002 were ¥216,786 million ($1,626,914 thousand), ¥200,936 million ($1,507,963 thousand), and¥14,813 million ($111,169 thousand), respectively. The corresponding amounts for the fiscal year ended March 31, 2001 were
¥217,609 million, ¥190,604 million, and ¥15,880 million, respectively.
Note: The computing method for the amount of interest income equivalents is defined as the difference between total lease payments and acquisition cost, which is allocated over the lease term by theinterest method.

Operating Leases
The future lease payments subsequent to the end of fiscal year for operating lease transactions were summarized as follows:
Lessees:Millions of yen
2002

At March 31

Due in One Year or Less
Due after One Year
Total

2001

Thousands of U.S. dollars
2002¥

11,02468,539¥14,28088,793$82,735514,365¥

79,563¥103,074$

597,100

Millions of yen
2002

2001

Thousands of U.S. dollars
2002

Lessors:
At March 31

Due in One Year or Less
Due after One Year

—
—

¥

3,451
3,797

—
—

—

¥

7,248

—

Millions of yen
2002

2001

Thousands of U.S. dollars
2002¥ 1,301,166
804,999345,789
225,999
18,612285,610¥ 1,035,529
372,919—
223,276
75,454326,239$ 9,764,850
6,041,271
2,595,039
1,696,058
139,680
2,143,421

2,982,177(333,720)

2,033,420(311,511)

22,380,319(2,504,472)¥ 2,648,456¥ 1,721,909$ 19,875,847¥(98,013)(57,074)¥(35,434)(33,967)$¥(155,087)¥(69,401)$ (1,163,883)¥ 1,652,508$ 18,711,964

Total

35. Deferred Tax Assets and Liabilities
Deferred Tax Assets and Liabilities consisted of the following:
At March 31

Deferred Tax Assets:
Reserve for Possible Losses on Loans
Tax Losses Carried Forward
Net Unrealized Losses on Other Securities
Securities
Reserve for Possible Losses on Loans Sold
OthersDeferred Tax Assets Subtotal:
Valuation AllowanceNet
Deferred Tax Liabilities:
Prepaid Pension Cost
OthersTotal
Net Deferred Tax Assets¥ 2,493,369(735,559)(428,324)

Balances reported on the Consolidated Balance Sheets:
At March 31

Millions of yen
2002

2001

Thousands of U.S. dollars
2002

Deferred Tax Assets
Deferred Tax Liabilities¥ 2,509,110(15,741)¥ 1,663,971(11,462)$ 18,830,097(118,133)

Net Deferred Tax Assets¥ 2,493,369¥ 1,652,508$ 18,711,964

MHHD and domestic subsidiaries are subject to a number of different income taxes.

133Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

36. Segment Information(a) Segment Information by Type of Business
MHFG is engaged in securities, trust, leasing and other activities as well as banking business. Such segment information,
however, has not been presented, as the percentages of those activities are insignificant.
(b) Segment Information by Geographic Area
Segment information by geographic area at March 31, 2002 and 2001 and for the fiscal year ended March 31, 2002 and2001 was as follows:
Millions of yen

2002
Geographic Area

Japan
Americas
EuropeAsia / Oceania excluding Japan
Total
Elimination and General Corporate Assets
Consolidated Results

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeOrdinary
Income¥ 3,570,407
1,021,454
354,392
235,929¥ 150,725
164,690
43,54059,817¥ 3,721,132
1,186,144
397,932
295,747

5,182,183—

418,773(418,773)

5,600,956(418,773)¥ 5,182,183¥—¥ 5,182,183

Ordinary
Expenses

Ordinary
ProfitTotal Assets¥ 5,156,794 ¥ (1,435,661) ¥ 137,325,053
1,012,734
173,409
13,682,037
381,442
16,4907,404,657
313,293(17,545)
7,711,025
6,864,264 (1,263,307)(332,230)(86,542)

166,122,774(14,810,346)¥ 6,532,033 ¥ (1,349,850) ¥ 151,312,427
Millions of yen

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeOrdinary
IncomeOrdinary
Expenses

Ordinary
ProfitTotal Assets

Japan
Americas
EuropeAsia / Oceania excluding Japan

¥4,014,636
1,136,941
335,629
269,768¥162,040
76,45535,201
69,281¥4,176,676
1,213,396
370,831
339,049¥3,735,873
1,112,686
353,817
286,742¥440,803
100,710
17,01352,307¥145,299,161
16,435,655
7,205,854
7,902,182

Total
Elimination and General Corporate Assets

5,756,975—

342,978(342,978)6,099,954(342,978)5,489,120(307,002)

610,833(35,976)

176,842,853(13,387,373)¥5,756,975¥¥5,756,975¥5,182,118¥574,857¥163,455,480

2001
Geographic Area

Consolidated Results—

Thousands of U.S. dollars

2002
Geographic Area

Japan
Americas
EuropeAsia / Oceania excluding Japan
Total
Elimination and General Corporate Assets
Consolidated Results

Ordinary Income
from Outside
Customers

Inter-segment
Ordinary
IncomeOrdinary
Income$ 26,794,803
7,665,697
2,659,604
1,770,580$ 1,131,146
1,235,949
326,756448,913$ 27,925,949
8,901,645
2,986,361
2,219,493

38,890,684—

3,142,764(3,142,764)

42,033,448(3,142,764)$ 38,890,684$—$ 38,890,684

Ordinary
Expenses

Ordinary
ProfitTotal Assets$ 38,700,147 $(10,774,197) $1,030,582,014
7,600,259
1,301,386
102,679,457
2,862,608
123,752
55,569,666
2,351,167(131,674)
57,868,858
51,514,181(2,493,289)(9,480,733) 1,246,699,995(649,475)(111,147,065)$ 49,020,892 $(10,130,208) $1,135,552,930

Notes: 1. Geographic analyses are presented based on geographic contiguity, similarities in economic activities, and relation of business
operations.
2. Ordinary Income represents Total Income less certain special income and Ordinary Expenses represent Total Expenses less certain
special expenses.
3. Ordinary Profit represents Ordinary Income less Ordinary Expenses.
4. Americas includes the United States of America and Canada. Europe includes the United Kingdom. Asia / Oceania includes Hong Kongand the Republic of Singapore.
5. In prior years, dividend from stocks that have market prices was recognized when it was declared Effective current fiscal year,
accrued dividend is recognized based on projected dividend rates amounted by issuers. Criteria for recognition / derecognition of
securities other than trading purpose also changed to a contract day basis. As a result, Ordinary Income for “Japan” increased by¥36,081 million ($270,780 thousand) and Ordinary Loss decreased by the same amount.

134

(c) Ordinary Income of Overseas Entities
Ordinary Income from Overseas Entities for the fiscal years ended March 31, 2002 and 2001 consisted of the following:
Millions of yen
For the Fiscal Years ended March 31

Ordinary Income from Overseas Entities
Total Ordinary Income

2002

2001

¥ 1,611,776
5,182,183¥1,742,339
5,756,975

Ordinary Income from Overseas Entities’ Ratio

31.10%

Thousands of U.S. dollars
2002$ 12,095,881
38,890,684

30.26%

31.10%

Notes: 1. Ordinary Income from Overseas Entities represents Ordinary Income recorded by overseas branches of DKB, Fuji Bank, IBJ and otheroverseas subsidiaries excluding Inter-segment Ordinary Income. Ordinary Income from international operations is presented in lieu of Sales
as is the case for non-financial companies.
2. Segment information on Ordinary Income from Overseas Entities is not presented as no such information is compiled.

37. Subsequent Events
Combination and Reorganization
MHHD succeeded “business of managing a securities company subsidiary and a trust bank subsidiary” from the Three Banks bymeans of a “Simplified method of a split” provided by the Commercial Code of Japan. As a result, Mizuho Securities Co., Ltd.
and Mizuho Trust & Banking Co., Ltd. became MHHD’s directly-owned subsidiaries on April 1, 2002. MHHD assumed assets of¥420,000 million and liabilities of ¥220,000 million from the Three Banks and its capital investments in the Three Banks decreasedby ¥200,000 million as a result of the splits. Since MHHD did not issue any new stock as part of the splits, its capital stock andcapital surplus have remained unchanged.
The Three Banks, which are MHHD’s subsidiaries, were combined and reorganized (the “Combination and Reorganization”) as
Mizuho Corporate Bank and Mizuho Bank on April 1, 2002 by means of split and merger.
Additionally, Fuji Bank changed its name to Mizuho Corporate Bank and DKB to Mizuho Bank.
In the Combination and Reorganization, the businesses and assets and liabilities are transferred among the Three Banks as follows:(1) DKB succeeded “operations of customer and consumer banking businesses” from Fuji Bank by means of “Split andAbsorption.” As a result, DKB assumed the following assets and liabilities:
Millions of yen

AssetsCash and Due from Banks
Commercial Paper and Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment
Deferred Tax Assets
Customers’ Liabilities for Acceptances and Guarantees
Reserve for Possible Losses on Loans
Reserve for Possible Losses on Securities

2,482,514
372
42,249690
5,039,513
18,504,006
58,823739,857
455,609309,842482,387(286,434)(97,300)

Liabilities
Deposits
Negotiable Certificates of Deposit
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities
Reserve for Bonus Payment
Reserve for Employee Retirement Benefits
Reserve for Possible Losses on Loans Sold
Reserve for Possible Losses on Support of Specific Borrowers
Acceptances and Guarantees

Total Liabilities
Total Assets

27,732,133

Net Assets

24,360,681
1,049,850
25,6411,470
1,253
1,209,586
4,776
31,23020,53732,400482,387

27,219,815
512,317135

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(2) DKB, as a surviving bank, succeeded “operations of customer and consumer banking businesses” of IBJ by means of “Split
and Absorption.” As a result, DKB assumed the following assets and liabilities:
Millions of yen

AssetsCash and Due from Banks
4,770,095
Trading Assets
89,449
Money Held in Trust
851
Securities
377,905
Loans and Bills Discounted
2,855,164
Foreign Exchange Assets
7,926
Other Assets
52,181
Premises and Equipment
18,691
Deferred Debenture Charges
4,095
Deferred Tax Assets
65,737
Customers' Liabilities for Acceptances and Guarantees
36,109Reserve for Possible Losses on Loans(70,075)
Reserve for Possible Losses on Securities(92)

Liabilities
Deposits
Negotiable Certificates of Deposit
Debentures
Trading Liabilities
Borrowed Money
Other Liabilities
Reserve for Bonus Payments
Reserve for Possible Losses on Loans Sold
Acceptances and Guarantees

Total Liabilities
Total Assets

8,208,039

Net Assets

808,698
566,600
6,101,713
89,915846
398,856568
1,802
36,1098,005,112
202,926(3) Fuji Bank succeeded “operations of corporate banking businesses” from DKB by means of “Split and Absorption.” As a result,
Fuji Bank assumed the following assets and liabilities:
Millions of yen

AssetsCash and Due from Banks
607,542
Call Loans
206,573
Commercial Paper and Other Debt Purchased
40,529Trading Assets
340,418
Money Held in Trust
43,442
Securities
3,165,489
Loans and Bills Discounted
11,330,954
Foreign Exchange Assets
631,786
Other Assets
238,880
Premises and Equipment
8,769
Deferred Tax Assets
346,042
Customers' Liabilities for Acceptances and Guarantees 1,229,018
Reserve for Possible Losses on Loans(491,170)
Reserve for Possible Losses on Securities(373)

Liabilities
Deposits
Negotiable Certificates of Deposit
Call Money
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Acceptances and Guarantees

Total Liabilities
Total Assets

136

17,697,905

Net Assets

10,684,813
1,573,086
140,361
83,3452,567
590,2313,255,109
1,248
2,546
1,229,018

17,562,329
135,576

(4) Fuji Bank, as another surviving bank, succeeded “operations of corporate banking businesses” of IBJ by Merger. As a result,
Fuji Bank assumed the following assets and liabilities:
Millions of yen

AssetsCash and Due from Banks
Call Loans
Receivables under Resale Agreements
Commercial Paper and Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment
Deferred Debenture Charges
Deferred Tax Assets
Customers' Liabilities for Acceptances and Guarantees
Reserve for Possible Losses on Loans
Reserve for Possible Losses on Securities

2,868,974
215,604
117,222
16,492
1,862,091
6
7,243,221
16,342,313
162,892
8,172,966
236,233
39
466,067
1,428,491(288,992)(87)

Liabilities
Deposits
Negotiable Certificates of Deposit
Debentures
Call Money
Payables under Repurchase Agreements
Bills Sold
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Reserve for Contingencies
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities

Total Assets

38,843,537

13,932,364
2,715,221
9,703,856
1,515,354
1,730,554
943,700
60,0001,332,322
1,481,067
37,582
3,327,330
1,370
5,767
134,203
54,141
1,428,491
38,403,327

Net Assets

440,209

As a result of the Combination and Reorganization, MHHD's capital surplus decreased by ¥1,849,982 million. The offsetting
accounts are summarized as follows:
Decrease in Securities¥ 847,166 million
Decrease in Other Assets¥ 167,298 million
Decrease in Revaluation Reserve for Land, net of Taxes¥ 111,660 million
Increase in Retained Earnings¥ 896,131 million
Increase in Foreign Currency Translation Adjustments¥ 51,045 million

Appropriation of Retained Earnings
The following Appropriation of Retained Earnings was approved at the shareholders’ meeting held on June 25, 2002.
Millions of yen

Cash Dividends:
First Series Class I Preferred Shares
Second Series Class II Preferred Shares
Third Series Class III Preferred Shares
Fourth Series Class IV Preferred Shares
Sixth Series Class VI Preferred Shares
Seventh Series Class VII Preferred Shares
Eighth Series Class VIII Preferred Shares
Ninth Series Class IX Preferred Shares
Tenth Series Class X Preferred Shares
Common Shares¥ 22,500 per Share¥ 8,200 per Share¥ 14,000 per Share¥ 47,600 per Share¥ 42,000 per Share¥ 11,000 per Share¥ 8,000 per Share¥ 17,500 per Share¥ 5,380 per Share¥ 3,500 per Share

¥

742
820
1,400
7,140
6,300
1,375
1,000
2,450
753
33,004

Thousands of U.S. dollars

$

5,572
6,154
10,50753,58347,280
10,3197,505
18,386
5,653
247,692

137

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

38. Market Value of Securities and Money Held in Trust
The following tables contain information relating to Securities, Cash and Due from Banks (negotiable certificates of deposit) and
Other Debt Purchased (commercial paper, etc.) at March 31, 2002 and 2001.
Millions of yen

At March 31, 2002

Other Securities*2, 3
Stocks*4
Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
OthersMoney Held in Trust*3
Other Money Held in Trust

Gross unrealized
Gains

LossesMarket value¥ 23,231,117
7,092,274
11,104,080
10,570,896
258,259
274,924
5,034,762

Cost¥ 459,892
409,547
15,484
7,762
5,194
2,527
34,860¥ 1,347,502
1,156,139
29,00923,907
1,099
4,003
162,353¥ 22,343,508
6,345,683
11,090,554
10,554,751
262,354
273,448
4,907,269

10,275376—

10,652Millions of yen

At March 31, 2001

Other Securities*2, 3
Stocks*4
Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
OthersMoney Held in Trust*3
Other Money Held in Trust

Gross unrealized
Gains

LossesMarket value¥ 25,932,871
7,912,749
12,363,591
11,641,796
261,816
459,979
5,656,530

Cost¥ 864,467
765,889
45,01225,457
8,107
11,44653,565¥ 1,140,119
1,073,119
12,688
11,843
119725
54,310¥ 25,657,219
7,605,519
12,395,915
11,655,409
269,804
470,700
5,655,785

5,449

196

—

5,645
Thousands of U.S. dollars

At March 31, 2002

Other Securities*2, 3
Stocks*4
Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
OthersMoney Held in Trust*3
Other Money Held in Trust

Gross unrealized
Gains

LossesMarket value$ 174,342,348
53,225,328
83,332,684
79,331,305
1,938,159
2,063,220
37,784,336

Cost$ 3,451,351
3,073,529
116,205
58,25638,982
18,967
261,617$ 10,112,587
8,676,466
217,710
179,4198,249
30,042
1,218,411$ 167,681,112
47,622,391
83,231,179
79,210,142
1,968,892
2,052,145
36,827,542

77,113

2,827—

79,940*1 A summary of Trading Securities and Money Held in Trust for Investment Purposes and related unrealized gains and losses are as follows :At March 31

Millions of yen
2002
2001
MarketUnrealized
MarketUnrealizedvalue
gains (losses)
value
gains (losses)

Trading Securities¥ 5,056,575
Money Held in Trust for Investment Purpose
59,110¥ (2,276)(1,261)¥ 7,921,803
386,918

Thousands of U.S. dollars
2002
MarketUnrealizedvalue
gains (losses)¥ 6,489 $ 37,948,036(13,645)443,609$ (17,084)(9,465)*2 In addition to the balances shown in the above table, Other Securities included securities without market values such as unlisted stock (excluding OTC stock) of ¥249,969 million ($1,875,942 thousand)and ¥337,990 million and non-publicly offered bonds of ¥946,344 million ($7,102,023 thousand) and ¥880,731 million as of March 31, 2002 and 2001, respectively.
*3 As described in Note 3 (2), unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.
*4 Market value of Stocks is determined based on the average market prices during one-month periods before the balance sheet date as at March 31, 2002, and on the market prices prevailing on thebalance sheet date as at March 31, 2001.

138

Projected redemption amounts for securities classified as Other Securities
Millions of yen

At March 31, 2002

Within 1 year

1–5 years

5–10 years

Over 10 years

Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
Others¥ 3,948,107
3,854,025
8,000
86,081
1,054,129¥ 5,252,103
4,435,047
83,539733,516
2,092,251¥ 2,794,599
2,265,678
269,984
258,936969,283¥ 22,088—
10,64011,447
1,003,310¥ 5,002,237¥ 7,344,354¥ 3,763,882¥ 1,025,398

At March 31, 2001

Within 1 year

1–5 years

5–10 years

Over 10 years

Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
Others¥ 7,213,291
7,085,545
24,539103,206
756,858¥ 3,371,463
2,581,204
97,345692,913
3,167,870¥ 2,623,373
1,975,045
343,394
304,934
1,208,409¥ 15,698—
11,096
4,602
781,854¥ 7,970,150¥ 6,539,334¥ 3,831,782¥ 797,552

Within 1 year

1–5 years

5–10 years

Over 10 years$ 29,629,327
28,923,268
60,045646,0147,910,915$ 39,415,414
33,283,658
626,940
5,504,816
15,701,697$ 20,972,603
17,003,217
2,026,147
1,943,239
7,274,170$ 165,765—
79,852
85,9137,529,533$ 37,540,242$ 55,117,111$ 28,246,773$ 7,695,298

Total

Millions of yen

Total

Thousands of U.S. dollars

At March 31, 2002

Bonds:
Japanese National Government Bonds
Japanese Local Government Bonds
Corporate Bonds
Others
Total

Other Securities sold during the fiscal year
Millions of yen

For the Fiscal Years ended March 31

Other Securities

Proceeds
from sales

2002
Total amountof gains
on salesTotal amountof losses
on sales¥ 40,132,379¥ 415,387¥ 120,291

Proceeds
from sales

2002
Total amountof gains
on salesTotal amountof losses
on sales$ 301,181,087$ 3,117,353$ 902,754

Proceeds
from sales

2001
Total amountof gains
on salesTotal amountof losses
on sales¥ 58,047,079¥ 955,377¥ 62,658

Thousands of U.S. dollars

For the Fiscal Year ended March 31

Other Securities

Net Unrealized Gains (Losses) on Other Securities
Net Unrealized Losses on Other Securities as of March 31, 2002 and 2001 are as follows:
At March 31, 2002

Millions of yen

Thousands of U.S. dollars

Difference between cost and market value
Other Securities
Other Money Held in Trust¥ (888,132)(888,509)376$ (6,665,162)(6,667,989)
2,827

331,2814,209(561,061)

2,486,164
31,593(4,210,591)

1,586

11,903989¥ (558,485)

7,426$ (4,191,262)

Deferred Tax Assets
Deferred Tax Liabilities
Difference between cost and market value, net of Taxes
Amount corresponding to Minority Interests
Amount corresponding to Net Unrealized Losses on Other Securities owned by affiliatedcompanies, which corresponds to the holding shares by their investor companies
Net Unrealized Losses on Other Securities, net of Taxes

139

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

At March 31, 2001

Millions of yen

Difference between book value and market value
Other Securities
Other Money Held in Trust¥ (275,455)(275,651)
196

Amount corresponding to Deferred Tax Assets
Difference between book value and market value, net of Taxes

105,613(169,842)

Amount corresponding to Minority Interests
3,675
Amount corresponding to Net Unrealized Losses on Other Securities owned
3,811
by affiliated companies,which corresponds to the holding shares by their investor companies
Amount corresponding to Net Unrealized Losses on Other Securities, net of Taxes ¥ (162,354)
Note: As described in Note 3 (2), unrealized losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

39. Derivatives Information(A) Risk Control for Derivatives(1) Details of Derivative Financial Products
MHFG transacts primarily in the following derivative financial products:(i) Interest rate-related products
Swaps, interest rate guarantees (FRA options), futures, futures options, and options(ii) Currency-related products
Futures, futures options, options, swaps, and forward trading(iii) Bond-related products
Futures, futures options, and over-the-counter options(iv) Stock-related products
Index futures, index futures options, and over-the-counter options(v) Others products
Credit derivatives, futures (Commodity-related), options (Commodity-related), weather derivatives, etc.
(2) Purposes for Using Derivative Financial Products
MHFG uses derivative financial products in response to the diverse needs of customers, for risk controls related to the assets andliabilities of MHFG as a part of asset and liability management (“ALM”), and for trading purposes.
As risk controls related to assets and liabilities, MHFG primarily utilizes macro-hedges for the total management of interest raterisk related to numerous financial assets and liabilities, such as loans and deposits, by using interest rate swaps, etc., as hedging
methods. MHFG applies hedge accounting to the majority of these products, treating them as deferred hedges. The effectivenessof the hedges are assessed by periodically checking whether the total net risk amount of derivative financial products falls
within the risk limit as set out in the risk management policy, and whether interest rate risk exposures from hedged items havebeen reduced.
(3) Trading Guidelines
In accordance with the purposes of using derivative financial products, MHFG deals in derivative financial products based on thefollowing guidelines:(i) Responding to Customer Needs
After obtaining an adequate understanding of customer requirements, we follow the group's common policy toward selling
financial products by recommending the most appropriate financial vehicle according to each customer's knowledge, experience and asset position. When actually making a sale, we endeavor to give full explanations to our customers to ensure thatthey clearly understand the nature of each product, the risks involved and other important matters.
(ii) Risk control of assets and liabilities of MHFG (ALM)
MHFG's ALM & Market Risk Committee meets periodically to confirm or revise the trading guidelines for the purposes of
securing stable income while appropriately controlling risk.
(iii) Trading activities
MHFG engages in trading activities to maximize income under reasonable risk limits and strict management.

140

(4) Details of Trading-related Risk
The following are the main risks, inherent in derivatives trading.
(i) Credit risk:
The risk of incurring a loss because the counter-parties are unable to fulfill their obligations due to bankruptcy or otherreasons.
(ii) Market risk:
The risk of incurring a loss because the value of the derivative products decrease caused by fluctuations in market risk factors
such as interest rates, foreign exchange rates and bond and stock prices.
(iii) Market liquidity risk:
The risk of incurring a loss from the inability to execute transactions in the market on unfavorable prices due to illiquidity ofthe products.
(5) Derivative Trading Risk Control Structure(i) Credit risk management structure
The Board of Directors determines important items concerning credit risk in accordance with the Credit Risk Management
Policy. MHHD has established the Portfolio Management Committee as one of its business policy committees. This committee
conducts overall deliberation on and adjustment of MHFG’s credit portfolio management procedures. Under the jurisdiction of
the Chief Risk Officer, the Risk Management Department and the Credit Risk Management Department jointly formulate andimplement plans for basic matters related to credit risk management.
The amount of credit risk on derivatives trading (credit risk equivalent) calculated into the BIS capital adequacy ratio (international capital adequacy standards) is ¥4,171,851 million.
(ii) Market risk management structure
The Market Risk Management Policy is determined by the Board of Directors, and MHHD has established the Risk Management Department. This department is responsible for monitoring market risk, reports and analyses, proposals, setting limits,and for formulating and implementing plans relating to market risk management as a specialized risk management section.
MHHD and its consolidated subsidiaries have established a solid management structure for market risk including comprehensive management (ALM) of interest rate risk and other types of risk. Through this structure, they comprehensively ascertain
and manage risk, while managing assets to secure stable income and appropriately controlling risk.
MHHD has established the ALM & Market Risk Committee as one of the business policy committees charged with conducting overall deliberation on and adjustment of market risk management procedures. The committee decides the entire group’smonthly funding and investment policies, discusses and coordinates matters relating to ALM policies, risk planning and market
risk management, and responds to emergencies such as sudden market changes.
In regards to reporting, the Risk Management Department receives the relevant data from the five core subsidiaries, as well
as reports on risk profile and compliance with risk limits, both on a regular basis and as considered necessary. Based on thesereports, MHHD obtains a solid grasp of the market risk management situation. Reports on the status of market risk and compliance with risk limits are submitted to the CEO on a daily basis, and to the Board of Directors and the Executive
Management Committee, on a regular basis and as considered necessary.
Value at Risk

Value at Risk (VAR) related to MHFG’s trading activities is as follows:(a) The standards used for calculating VAR• Confidence interval: one-tailed 99.0% (two-tailed 98%)
• Holding period: 1 day• Historical observation period: 1 year (265 business days, 264 return)(b) VAR results during the period covered• Maximum: ¥12.0 billion and ¥13.4 billion for the fiscal years ended March 31, 2002 and 2001, respectively• Average: ¥ 9.7 billion and ¥ 9.8 billion for the fiscal years ended March 31, 2002 and 2001, respectively
The period covered is from April 1, 2001 to March 31, 2002, and October 2, 2000 to March 30, 2001, respectively.
Note: Value at Risk (VAR) is a method of measuring market risk. It is defined as the maximum possible loss that could be incurred on our portfolio as a result of market movements within a certain
period (holding period) and degree of probability (confidence interval). The actual amount of the VAR may vary according to the length of the holding periods and the confidence interval, as
well as the models used for measuring the volatility of market risk factors.

141

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements

Credit risk equivalent amounts

Credit risk equivalent amounts at March 31, 2002 and 2001 consisted of the following:
Millions of yen
At March 31

Interest rate Swaps
Currency Swaps
Foreign Exchange Forward Transactions
Interest rate Options (Buy)Currency Options (Buy)
Other Financial Derivative Products
Effect of Reduction in the Credit Risk Equivalent Amount due toLump-sum Settlement Netting Contracts
Total

Thousands of U.S. dollars

2002

2001

2002

¥ 8,590,445
1,283,201
1,233,627
100,999
291,251
139,306¥ 7,358,096
1,137,870
2,227,921
71,456
221,859
119,521$ 64,468,630
9,630,027
9,257,995
757,971
2,185,750
1,045,450(7,466,979)(6,798,896)(56,037,370)¥ 4,171,851¥ 4,337,831$ 31,308,453

Note: The above is the credit risk equivalent amount based on the consolidated capital adequacy ratio (a uniform international standard).

(B) Market Value of Derivatives
The market value of derivatives at March 31, 2002 and 2001 was as follows:
In the following tables:(i) Contract value represents notional amounts for swap transactions and contract amounts for other transactions.
(ii) Market values of listed contracts are based on the closing prices of the Tokyo Stock Exchange and the Tokyo International
Financial Futures Exchange and others. Market values of over-the-counter contracts are based on the discounted value of
future cash flows or option pricing models.
(1) Interest Rate-Related Transactions
Millions of yen

At March 31, 2002

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtTotal

142

Contract value
Total
Over one year

¥ 7,021,558
3,746,983¥

2,385,852
2,313,561

Market value

Unrealized
gains (losses)

¥

¥

3,762
1,522

3,762
1,522

2,069,407
1,929,895

171,114229,219

7,415
5,784

(2,803)
1,633

30,280,783
29,398,902

7,624,841
7,682,984

31,856(29,168)

31,856(29,168)

259,228,559
256,258,811
15,335,921
3,070,125

161,909,892
156,719,785
10,765,936
2,764,976

7,685,119(7,261,247)
(884)
1,274

7,685,119(7,261,247)
(884)
1,274

11,340,608
10,252,957

7,866,548
7,524,157(43,415)
84,616(67,579)
72,765///¥ 436,250

Millions of yen

At March 31, 2001

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtTotal

Contract value
Total
Over one year

Market value

Unrealized
gains (losses)¥ 31,653,308
35,499,788¥ 10,386,242
12,938,286¥ (385,162)
387,515¥ (385,162)
387,5158,224,799
6,486,581

421,994578,949

7,307
10,165(3,255)
5,682

27,079,298
22,619,539

6,220,724
5,657,425

29,800(28,396)

29,800(28,396)259,626,266
262,599,202
10,375,720
2,626,411

145,525,033
145,215,353
5,251,600
1,995,516

6,021,782(6,164,663)
1,633
3,125

6,021,782(6,164,663)
1,633
3,125

8,824,099
7,087,622

5,742,276
4,739,979

11,40363,914(9,753)45,046///¥(96,645)

Thousands of U.S. dollars

At March 31, 2002

Listed:Futures:
Sold
BoughtOptions:
Sold
BoughtOver-the-Counter:
FRAs:
Sold
BoughtSwaps:
Receive Fixed / Pay Float
Receive Float / Pay Fixed
Receive Float / Pay Float
Receive Fixed / Pay Fixed
Options:
Sold
BoughtTotal

Contract value
Total
Over one year

$ 52,694,621
28,119,951$

17,905,082
17,362,565

Unrealized
gains (losses)

Market value$

28,236
11,425$28,236
11,425

15,530,266
14,483,270

1,284,161
1,720,222

55,64943,408(21,042)
12,258227,247,908
220,629,659

57,222,075
57,658,421

239,072(218,899)

239,072(218,899)

1,945,430,093
1,923,143,051
115,091,346
23,040,344

1,215,083,624
1,176,133,472
80,795,022
20,750,293

57,674,442(54,493,417)(6,639)9,568

57,674,442(54,493,417)(6,639)9,568

85,107,758
76,945,273

59,036,009
56,466,470(325,822)
635,020(507,165)
546,085///$ 3,273,924

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.

143

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(2) Currency-Related Transactions
Millions of yen

At March 31, 2002

Over-the-Counter:
Currency Swaps
Others:Sold
BoughtContract value
Total
Over one year

Market value

Unrealized
gains (losses)¥ 21,213,205¥ 13,650,730¥ 162,296¥ 49,786

13,956
4,331

13,956
659

(42)
522

(42)
522

/

/

/

¥ 50,266

Market value

Unrealized
gains (losses)

Total

Millions of yen

At March 31, 2001

Over-the-Counter:
Currency Swaps
Others:Sold
BoughtContract value
Total
Over one year

¥ 17,372,314¥ 12,285,917¥ 225,082¥ 101,465

—
—

—
—

—
—

—
—

/

/

/

¥ 101,465

Total

Thousands of U.S. dollars

At March 31, 2002

Over-the-Counter:
Currency Swaps
Others:Sold
BoughtContract value
Total
Over one year

Market value

Unrealized
gains (losses)$ 159,198,544$ 102,444,508$ 1,217,985$ 373,632

104,736
32,504

104,736
4,949

(316)
3,923

(317)
3,923

/

/

/

$ 377,238

Total

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting and the following transactions described in note 4 are excluded from the abovetable.
3. “Others” denotes swaption transactions.
4. Currency swap transactions which are accrued in accordance with “Tentative Auditing Treatment for the Continuing Adoption of ’New
Foreign Exchange Accouting Standards’ in banking industries” issued by JICPA dated April 10, 2000, at March 31, 2001, and “Tentative
Accounting and Auditing Treatment Relating to Adoption of ‘Accounting for Foreign Currency Transaction’ for Banks” (JICPA Industry
Audit Committee Report No.20), at March 31, 2002, are excluded from the above tables.
Currency swap transactions accounted for under the accrual method are as follows:
Millions of yen

Contract
value

2002
Marketvalue

Unrealized
gains (losses)¥ 825,902¥ 14,901¥ (9,790)

At March 31, 2002

Contract
value

2002
Marketvalue

Unrealized
gains (losses)

Currency Swaps$ 6,198,146$ 111,834$ (73,472)

At March 31

Currency Swaps

Contract
value

2001
Marketvalue

Unrealized
gains (losses)¥ 1,576,084¥ 10,348¥ (5,114)

Thousands of U.S. dollars

5. The following currency forwards, currency options and other transactions are excluded from the above table:* Transactions which are marked to market and of which charge in unrealized gains (losses) are included in the Consolidated Statementsof Operations.
* Transactions which are for financial assets and liabilities denominated in foreign currencies and recognized on the Consolidated Balance
Sheets.
* Transactions denominated in foreign currencies which are eliminated in the consolidation process.

144

Currency-related derivatives which are marked to market are as follows:
Millions of yen
2002
Contract value

At March 31

Listed:Futures:
Sold
BoughtOver-the-Counter:
Forwards:
Sold
BoughtOptions:
Sold
Bought¥——Thousands of U.S. dollars
2002
Contract value

2001
Contract value

¥

1,469
209

$

—
—

14,927,469
19,822,319

24,321,306
28,970,975

112,026,039
148,760,368

4,987,169
4,830,134

4,608,183
4,571,896

37,427,160
36,248,666(3) Stock-Related Transactions
Millions of yen

2002

2001

Contract value
At March 31

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Contract valueOver
one yearMarketUnrealized
value gains (losses)

¥

—
—

¥ 651
(0)

19,534
10,225——

12,50518,031/

Total¥ 40,892
44

¥

Total

651
(0)

¥ 69,338
15,981

46
195

98
72

1,924
5,311

375
1,394

/

/

Over
one year¥MarketUnrealized
value gains (losses)——¥ 1,002(224)¥ 1,002(224)

35,494
12,046

—
—

128
293

(12)
35

(54)
576

6,182
15,555

1,300
4,673

372
986

(102)
717

¥ 1,343///¥ 1,415

Thousands of U.S. dollars

Contract value
At March 31, 2002

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Over
one yearTotal$ 306,883
336$

MarketUnrealized
value gains (losses)——$ 4,889(3)$ 4,889(3)

146,600
76,735

—
—

350
1,467

736
540

93,846135,320

14,44639,862

2,819
10,468

(410)
4,329

/

/

/

$ 10,081

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.

145

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(4) Bond-Related Transactions
Millions of yen

2002

2001

Contract value
At March 31

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
Bought
Total

Total

¥ 513,612
363,057

Contract valueOver
one year¥MarketUnrealized
value gains (losses)

Total

Over
one yearMarketUnrealized
value gains (losses)¥——¥ (876)944¥ (876)
944

—
7,851

¥ 1,993(763)¥ 1,993(763)¥621,019
441,976

989,844931,01252,760105,520

967
1,435

(855)
1,012

503,069
440,881

—
—

204
898

402
415

246,429
246,715

502
—

25
100

(98)
22

86,07989,530

—
3,315

217
702

(18)
590

/

/

/

¥ 1,312///¥1,457

Thousands of U.S. dollars

Contract value
At March 31, 2002

Listed:Index Futures:
Sold
BoughtIndex Futures Options:
Sold
BoughtOver-the-Counter:
Options:
Sold
BoughtTotal

Over
one yearTotal$ 3,854,500
2,724,631$

MarketUnrealized
value gains (losses)—
58,924$ 14,962(5,727)$ 14,962(5,727)

7,428,473
6,986,959

395,947
791,895

7,261
10,772(6,417)
7,601

1,849,377
1,851,527

3,774
—

189
751

(737)
167

/

/

/

$ 9,849

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.

146

(5) Commodity-Related Transactions
Millions of yen

2002

2001

Contract value
At March 31

Over-the-Counter:
Options:
Sold
BoughtTotal

Contract value

Total

Over
one yearMarketUnrealized
value gains (losses)¥ 39,159
39,159¥ 22,088
22,088¥ 3,754
3,764

/

/

/

¥ (930)
1,259
¥

329

Total

Over
one yearMarketUnrealized
value gains (losses)¥ 5,031
5,031

¥ 496
496

¥ 330
330

/

/

/

¥ 101
(82)
¥

18

Thousands of U.S. dollars

Contract value
At March 31, 2002

Total

Over
one year

Over-the-Counter:
Options:
Sold
Bought$ 293,883 $ 165,765
293,883
165,765

Total/

MarketUnrealized
value gains (losses)$ 28,179
28,251$ (6,985)
9,455/$ 2,470/

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.
3. Commodities are oil, copper and aluminium at March 31, 2002, and oil and copper at March 31,2001.

(6) Credit Derivatives Transactions
Millions of yen

2002

2001

Contract value
At March 31

Total

Contract valueOver
one year

Over-the-Counter:
Credit Derivatives:
Sold
Bought¥ 68,987 ¥ 43,999
429,140
412,493

Total

/

/

MarketUnrealized
value gains (losses)

¥

(577)
25,230
/

Total

Over
one year(577)
25,230¥ 64,101
124,363¥ 60,021
113,189¥ (504)
1,016¥ (528)1,019¥ 24,652

/

/

/

¥ 490

¥

MarketUnrealized
value gains (losses)

Thousands of U.S. dollars

Contract valueOver
one yearMarketUnrealized
value gains (losses)

Over-the-Counter:
Credit Derivatives:
Sold
Bought$ 517,727 $ 330,203
3,220,569 3,095,637$ (4,333) $ (4,333)
189,345
189,345

Total/

At March 31, 2002

Total

/

/ $ 185,012

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Derivative transactions qualifying for hedge accounting are excluded from the above table.
3. “Sold” and “Bought” indicate assumption and cession of credit risk, respectively.

147

Financial Data of Mizuho Holdings

Notes to Consolidated Financial Statements(7) Weather Derivatives Transactions
Millions of yen

2002

2001

Contract value
At March 31

Over-the-Counter:
Weather Derivatives:
Sold
BoughtTotal

Contract value

Total

Over
one yearMarketUnrealized
value gains (losses)

¥ 230
230

¥—
—

¥0
0

/

/

/

Total

Over
one yearMarketUnrealized
value gains (losses)

¥ (0)
0

¥ 595
595

¥—
—

¥ 38
31

¥ 33
(7)

¥—

/

/

/

¥ 26

Thousands of U.S. dollars

Contract value
At March 31, 2002

Over-the-Counter:
Weather Derivatives:
Sold
Bought
Total

Total

Over
one yearMarketUnrealized
value gains (losses)$ 1,732
1,732

$—
—

$2
2

$ (2)
2

/

/

/

$—

Notes: 1. The above transactions are marked to market and charge in unrealized gains (losses) are included in the Consolidated Statements ofOperations.
2. Transactions are related to temperature and precipitation.

148

150 Non-Consolidated Financial Statementsof Mizuho Holdings and the Former Five Core
Subsidiaries
Mizuho Holdings
Non-Consolidated Balance Sheets

150

Non-Consolidated Statements of Operations

151

Dai-Ichi Kangyo Bank
Non-Consolidated Balance Sheets

152

Non-Consolidated Statements of Operations

153

Fuji Bank
Non-Consolidated Balance Sheets154

Non-Consolidated Statements of Operations

155

Industrial Bank of Japan
Non-Consolidated Balance Sheets

156

Non-Consolidated Statements of Operations

157

Mizuho Securities
Non-Consolidated Balance Sheets

158

Non-Consolidated Statements of Operations

159

Mizuho Trust & Banking
Non-Consolidated Balance Sheets

160

Non-Consolidated Statements of Operations

161

149

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Mizuho Holdings

Non-Consolidated Balance Sheets
Millions of yen
2002

At March 31

AssetsCurrent Assets
Cash and Due from Banks
Other Current Assets
Non-current Assets
Tangible Fixed Assets
Intangible Assets
Investments in Subsidiaries (Stocks)
Investments in Subsidiaries (Bonds)
Long-term Loans to Subsidiary
Other Investments
Deferred Charges
Total Assets
Liabilities and Shareholders’ Equity
Liabilities
Current Liabilities
Accrued Expenses
Accrued Taxes
Other Current Liabilities
Non-current Liabilities
Bonds
Total Liabilities
Shareholders’ Equity
Common Stock and Preferred Stock
Capital Surplus
Retained Earnings
Appropriated Reserve
Unappropriated Retained Earnings
Subtotal
Treasury Stock
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity
Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

150¥

66,64546,736
19,908
7,398,775
2,630
3,302
6,541,059
650,000
200,000
1,782
2,314

¥

Thousands of
U.S. dollars
2002

2001

47,27828,244
19,0337,362,267
2,344
876
6,507,049
650,000
200,000
1,996
3,086

$

500,153
350,746
149,407
55,525,517
19,742
24,78749,088,627
4,878,049
1,500,938
13,374
17,372¥ 7,467,735¥ 7,412,632$ 56,043,042

¥

¥

$

1,255
649
465
141
850,000
850,000

1,225
279
766
178
850,000
850,000

9,426
4,876
3,490
1,060
6,378,987
6,378,987

851,255

851,225

6,388,413

2,572,000
3,891,642
152,923
4,350
148,573

2,572,000
3,891,642
97,764—
97,764

19,302,064
29,205,570
1,147,640
32,645
1,114,995

6,616,565(85)

6,561,407—

49,655,274(645)

6,616,479

6,561,407

49,654,629¥ 7,467,735¥ 7,412,632$ 56,043,042

Non-Consolidated Statements of Operations
2001

Thousands of
U.S. dollars
2002¥ 123,082
96,79718,366
6,176
1,741¥ 114,020
95,957
12,3384,439
1,283$ 923,697
726,438
137,839
46,352
13,068Operating Expenses
Interest Expenses on Bonds
General and Administrative Expenses

22,301
7,913
14,388

13,961
5,723
8,237

167,369
59,385
107,984

Operating Profits
Non-operating Income
Non-operating Expenses

100,78038913

100,05954
820

756,328288
6,855

Income before Income Taxes
Income Taxes:
Current
Deferred

99,90599,293

749,761

1,319
20

1,678
(149)

9,906
151

¥ 98,565¥ 97,764$ 739,704

For the Fiscal Year / Period ended March 31

Operating Income
Dividends on Investments in Subsidiaries (Stocks)
Fees and Commissions Received from Subsidiaries
Interest Income on Investments in Subsidiaries (Bonds)
Interest Income on Loans to Subsidiary

Net Income

Millions of yen
2002

Notes: 1. The fiscal period ended March 31, 2001 represents a period from September 29, 2000.
2. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
3. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

151

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Dai-Ichi Kangyo Bank

Non-Consolidated Balance Sheets

2001

Thousands of
U.S. dollars
2002¥ 4,548,383
319,573
40,531
1,831,694
43,4427,806,381
30,919,214
731,491
2,471,700
790,567
901,1212,464,268(853,355)(389)¥ 1,820,781
197,108
1,538
3,947,367
328,785
7,151,958
31,550,945
315,527
3,009,652
765,632
522,539
2,811,452(603,214)(1,787)$ 34,134,212
2,398,303
304,178
13,746,297
326,025
58,584,478
232,039,134
5,489,620
18,549,348
5,932,963
6,762,636
18,493,573(6,404,171)(2,926)¥ 52,014,626¥ 51,818,289$ 390,353,670¥ 36,776,213
3,945,261
330,473
316,000
1,009,544
1,635,881
595,5452,788,642
6,526
25,926
6
196,5722,464,268¥ 33,883,192
4,087,584—
573,000
1,125,595
1,836,786
166,538
4,519,755—
113,4856
202,950
2,811,452$ 275,994,101
29,607,963
2,480,103
2,371,482
7,576,318
12,276,784
4,469,381
20,927,897
48,981
194,57348
1,475,212
18,493,573

50,090,862

49,320,347

375,916,416

858,784
747,181309,274
154,935
492,693(337,757)(146,412)

858,784
747,181319,176572,799
465,597
107,201—

6,444,914
5,607,364
2,321,011
1,162,746
3,697,514(2,534,768)(1,098,781)

Millions of yen
2002

At March 31

AssetsCash and Due from Banks
Call Loans
Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment
Deferred Tax Assets
Customers’ Liabilities for Acceptances and Guarantees
Reserve for Possible Losses on Loans
Reserve for Possible Losses on Securities
Total Assets
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Call Money and Bills Sold
Payables under Repurchase Agreement
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities
Reserve for Bonus Payments
Reserve for Possible Losses on Loans Sold
Other Reserves
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities
Shareholders’ Equity
Common Stock and Preferred Stock
Capital Surplus
Revaluation Reserve for Land, net of Taxes
Retained Earnings:
Appropriated Reserve
Unappropriated Retained Earnings
Net Unrealized Losses on Other Securities, net of Taxes
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity

1,923,764

2,497,941

14,437,254¥52,014,626¥51,818,289$390,353,670

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.
3. Unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

152

Non-Consolidated Statements of Operations
2002

2001

Thousands of
U.S. dollars
2002Interest Income
Loans and Bills Discounted
Securities
Fee and Commissions Income
Trading Income
Other Operating Income
Other Income¥ 799,626
629,218
127,897
126,363
35,98793,350256,922¥ 949,887
759,361
123,412120,865
42,893
93,233285,954$ 6,000,947
4,722,087
959,831
948,317
270,075
700,563
1,928,124Total Income

1,312,249

1,492,835

9,848,026

258,495
113,541
34,042
27,284384,393
1,292,236

422,349
231,037
32,89049,498374,311503,504

1,939,932
852,090
255,482
204,764
2,884,753
9,697,831

1,996,453

1,382,553

14,982,762(684,203)

110,281(5,134,736)

312(291,850)

21,717
16,021

2,346(2,190,245)

72,541$(2,946,837)

Millions of yen
For the Fiscal Years ended March 31

IncomeExpenses
Interest Expenses
Deposits
Fee and Commissions Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Income (Loss) before Income Taxes
Income Taxes:
Current
Deferred
Net Income (Loss)¥(392,666)¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

153

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Fuji Bank

Non-Consolidated Balance Sheets
2002

2001

Thousands of
U.S. dollars
2002¥ 3,968,495
314,385
63,5371,564,263
690
8,346,690
30,457,654
265,487
1,752,924
527,312763,161
2,462,953(477,107)(99,279)¥ 1,985,789
316,494
53,8352,003,435
26,364
10,526,340
31,666,743
305,079
2,692,520
522,999565,485
3,343,835(473,026)(98,425)$ 29,782,330
2,359,365
476,829
11,739,312
5,181
62,639,328
228,575,267
1,992,398
13,155,157
3,957,314
5,727,288
18,483,706(3,580,546)(745,062)¥ 49,911,168¥ 53,437,473$ 374,567,867¥ 36,185,885
2,973,437
334,021210,500
1,096,029
1,635,243
102,085
300,000
2,393,047
5,620
15,29920,53732,40078
81,1502,462,953¥ 33,731,546
3,457,195—
579,000
1,171,579
1,998,304
88,389300,000
6,108,022—
57,022
62,48835,712
78
83,122
3,343,835$ 271,563,865
22,314,728
2,506,725
1,579,737
8,225,360
12,271,998
766,1232,251,407
17,959,082
42,179114,816
154,127
243,152588
609,00918,483,706

47,848,289

51,016,298

359,086,602

1,039,544
929,907
131,340
153,000
231,471(78,470)(190,914)

1,039,544
929,907
134,475
317,247
223,873
93,373—7,801,456
6,978,671
985,673
1,148,223
1,737,123(588,900)(1,432,758)

Millions of yen
At March 31

AssetsCash and Due from Banks
Call Loans and Bills Purchased
Other Debt Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment
Deferred Tax Assets
Customers’ Liabilities for Acceptances and Guarantees
Reserve for Possible Losses on Loans
Reserve for Possible Losses on Securities
Total Assets
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Call Money and Bills Sold
Payables under Repurchase Agreements
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Bonds and Notes
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Reserve for Possible Losses on Loans Sold
Reserve for Possible Losses on Support of Specific Borrowers
Other Reserves
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities
Shareholders’ Equity
Common Stock and Preferred Stock
Capital Surplus
Revaluation Reserve for Land, net of Taxes
Retained Earnings:
Appropriated Reserve
Unappropriated Retained Earnings
Net Unrealized Losses on Other Securities , net of Taxes
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity

2,062,878

2,421,174

15,481,265¥ 49,911,168¥ 53,437,473$ 374,567,867

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.
3. Unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

154

Non-Consolidated Statements of Operations
2002

2001

Thousands of
U.S. dollars
2002Interest Income
Loans and Bills Discounted
Securities
Fee and Commissions Income
Trading Income
Other Operating Income
Other Income¥ 892,138
661,628
163,556
133,227
45,47994,410172,615¥ 1,010,628
784,299
113,214
127,418
38,541
32,460400,565¥ 6,695,224
4,965,318
1,227,440
999,832
341,313708,518
1,295,425

Total Income

1,337,871

1,609,614

10,040,312

342,359
216,668
54,427515
33,563362,687755,317

519,475
358,632
48,07915,573
15,902
346,140
556,846

2,569,304
1,626,033
408,461
3,869
251,885
2,721,858
5,668,427

1,548,871

1,502,017

11,623,804(211,000)

107,596(1,583,492)

267(81,667)274
39,1762,006(612,886)

Millions of yen
For the Fiscal Years ended March 31

IncomeExpenses
Interest Expenses
Deposits
Fee and Commissions Expenses
Trading Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Income (Loss) before Income Taxes
Income Taxes:
Current
Deferred
Net Income (Loss)¥ (129,600)¥

68,145¥(972,612)

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

155

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Industrial Bank of Japan

Non-Consolidated Balance Sheets
2002

2001

Thousands of
U.S. dollars
2002¥ 2,869,063
215,604
117,222
16,492
1,951,540
857
7,895,986
19,197,477
170,818
4,628,316
254,924
4,134
632,366
1,464,601(359,067)(179)¥ 1,040,678
354,657—
32,141
2,363,954
6,274
9,632,464
22,480,014
176,692
5,537,755
235,0399,540
323,827
1,786,157(263,538)—$ 21,531,435
1,618,043
879,716
123,773
14,645,709
6,437
59,256,934
144,071,127
1,281,943
34,734,082
1,913,127
31,0284,745,712
10,991,377(2,694,694)(1,345)¥ 39,060,159¥ 43,715,659$ 293,134,404¥ 9,522,884
15,805,570
2,459,054
1,730,554
123,000
1,422,237
1,481,914
37,582
3,726,187
1,939
797
1,802
—
134,20356,712
1,464,601¥ 8,308,958
18,395,801
4,015,726—
611,000
1,303,747
1,483,347
31,5405,792,429—
50,107
19,425141,025
24,03256,933
1,786,157$ 71,466,297
118,615,912
18,454,441
12,987,274
923,077
10,673,454
11,121,307
282,042
27,963,882
14,552
5,984
13,530—1,007,158
425,613
10,991,377

37,969,041

42,020,231

284,945,900

673,605
570,132
90,631(50,188)
307,916(358,105)(193,062)

673,605
570,132
91,061
360,630
275,154
85,475—

5,055,199
4,278,665
680,163(376,651)
2,310,819(2,687,470)(1,448,872)

Millions of yen
At March 31

AssetsCash and Due from Banks
Call Loans and Bills Purchased
Receivables under Resale Agreements
Other Debts Purchased
Trading Assets
Money Held in Trust
Securities
Loans and Bills Discounted
Foreign Exchange Assets
Other Assets
Premises and Equipment
Deferred Debenture Charges
Deferred Tax Assets
Customers’ Liabilities for Acceptances and Guarantees
Reserves for Possible Losses on Loans
Reserve for Possible Losses on Securities
Total Assets
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Debentures
Call Money and Bills Sold
Payables under Repurchase Agreements
Commercial Paper
Trading Liabilities
Borrowed Money
Foreign Exchange Liabilities
Other Liabilities
Reserves for Bonus Payments
Reserves for Employee Retirement Benefits
Reserves for Possible Losses on Loans Sold
Reserves for Possible Losses on Support of Specific Borrowers
Other Reserves
Deferred Tax Liabilities for Revaluation Reserve for Land
Acceptances and Guarantees
Total Liabilities
Shareholders’ Equity
Common Stock and Preferred Stock
Capital Surplus
Revaluation Reserves for Land, net of Taxes
Retained Earnings (Deficits):
Appropriated Reserves
Unappropriated Retained Earnings
Net unrealized Losses on Other Securities, net of Taxes
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity

1,091,118

1,695,428

8,188,504¥ 39,060,159¥ 43,715,659$ 293,134,404

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.
3. Unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

156

Non-Consolidated Statements of Operations
2001

Thousands of
U.S. dollars
2002

873,448555,845
201,994
81,564
41,293
105,378
168,329¥ 5,255,658
3,221,251
1,512,847
553,474
282,995
642,758
890,064

1,016,024

1,270,015

7,624,949

457,404
163,922
10,380117,081
14,01885
65,339149,221902,357

702,009
212,123
14,041
174,980
14,947—
61,899140,508
253,172

3,432,677
1,230,191
77,902878,657
105,206642
490,351
1,119,858
6,771,916

1,588,426

1,172,537

11,920,650(572,402)

97,478(4,295,701)

2,952(187,980)

1,105
34,43922,154(1,410,733)

61,933¥ (2,907,122)

Millions of yen
For the Fiscal Years ended March 31

IncomeInterest Income
Loans and Bills Discounted
Securities
Fee and Commissions Income
Trading Income
Other Operating Income
Other Income
Total Income
Expenses
Interest Expenses
Debentures
Amortization of Debenture Discounts
Deposits
Fee and Commissions Expenses
Trading Expenses
Other Operating Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Income (Loss) Before Income Taxes
Income Taxes:
Current
Deferred
Net Income (Loss)

2002

¥

700,316
429,231
201,586
73,75037,70985,647
118,601¥ (387,373)¥¥

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

157

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Mizuho Securities

Non-consolidated Balance Sheets
Thousands of
U.S. dollars
2002

Millions of yen
At March 31

AssetsCash and Cash Equivalents
Cash and Cash Equivalents Segregated as Deposits
Receivables:
Call Loans and Short-term Loans
Accrued Income
OthersTrading Assets
Securities Purchased under Resale Agreements
Securities Borrowed
Securities in Custody
Property, Equipment and Leasehold Improvements, at Cost
Less: Accumulated Depreciation

2002

¥

Liabilities and Shareholders’ Equity
Liabilities
Short-term Borrowings
Payables:Unsettled-trades
Other Payables to Customers
OthersTrading Liabilities
Securities Sold under Repurchase Agreements
Securities Loaned
Accrued Liabilities and Others:
Income Taxes Payable
OthersObligation to Return CollateralLong-term Borrowings
Statutory Reserves
Total Liabilities
Shareholders’ Equity
Common Stock
Additional Paid-in Capital
Retained Earnings (Deficits)
Net Unrealized Losses on Other Securities, net of Taxes
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity

5,500
1,243

$

819,825
67,10320,0005,865
2,043
2,074,360
1,253,402
1,282,966
1,665,736
6,733(1,602)
5,130
46,957
1,275
9,943

36
43,914
17,516
11,128,711
88,1979,001,235—
57,530(19,679)
37,851
245,834
34,322
68,932¥ 2,872,000¥ 6,374,426$ 21,553,476¥¥

10,055$ 3,746,025

81,412
2,682
1,014
1,068,049
53,399920,846

113,980
1,738
879
667,372
1,185,621
2,474,141

610,974
20,134
7,616
8,015,378
400,747
6,910,664

2,055
6,407
—
55
252

6
6,849
1,665,736
113
139

15,42848,083—415
1,895

2,635,333

6,126,633

19,777,359

150,200
95,324(4,463)(4,393)150,200
95,324
2,268—

1,127,205
715,380(33,494)(32,974)

499,157

236,667

247,792

1,776,117¥ 2,872,000¥ 6,374,426$ 21,553,476

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.
3. Unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

158

¥

4
5,851
2,334
1,482,900
11,752
1,199,414—
7,665(2,622)
5,043
32,7574,573
9,185

Investments in Securities
Deferred Tax Assets
Other Assets
Total Assets

109,241
8,941

2001

Non-consolidated Statements of Operations
For the Fiscal Years ended March 31

2002

2001

Thousands of
U.S. dollars
2002

IncomeCommissions Income
Trading Income
Interest and Dividend Income
Other Income¥ 28,281
5,353
10,886329¥ 13,121
3,642
9,933
78

$ 212,247
40,176
81,6992,475

Subtotal
Less: Interest Expenses

44,851(2,869)26,777(6,207)

336,597(21,538)

Total Income

41,981

20,570315,059

27,59518,507

19,1873,578

207,099
138,891

46,10322,765345,990

4,121

2,195

30,931

2,718
(109)

126
(946)

20,404
(819)

2,609

(819)

19,585¥ 6,731¥ 1,375$ 50,516

Millions of yen

Expenses
Selling, General, and Administrative Expenses
Other Expenses
Total Expenses
Loss before Income Taxes
Income Taxes:
Current
Deferred
Net Loss
Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

159

Non-Consolidated Financial Statements of Mizuho Holdings and the Former Five Core Subsidiaries

Mizuho Trust & Banking

Non-Consolidated Balance Sheets
Millions of yen
At March 31

AssetsCash and Due from Banks
Call Loans
Money Held in Trust
Securities
Foreign Exchanges
Other Assets
Premises and Equipment
Deferred Tax Assets
Reserve for Possible Losses on Loans
Total Assets
Liabilities and Shareholders’ Equity
Liabilities
Deposits
Call Money
Borrowed Money
Due to Trust Accounts
Other Liabilities
Reserve for Bonus Payments
Reserve for Employee Retirement Benefits
Total Liabilities
Shareholders’ Equity
Common Stock
Capital Surplus
Retained Earnings (Deficits)
Net Unrealized Gains on Other Securities, net of Taxes
Total Shareholders’ Equity
Total Liabilities and Shareholders’ Equity

2002

2001

¥ 62,617——
100,433—
81,2733,209
14,754(22)¥ 107,576
11,85811,000196,904
1,102
96,181
4,589
11,688(33)$¥ 262,266¥ 440,867$ 1,968,227¥ 23,251
45,00031,500
8,145
2,762
553
3,557

¥ 41,243——
230,124
14,900—3,059$

114,770289,328

861,317

115,000
55,000(22,505)
1

115,000
55,000(18,461)—

863,040
412,758(168,897)9

469,923——
753,726—
609,936
24,085
110,728(171)

174,497
337,711236,398
61,127
20,735
4,154
26,695

147,495

151,538

1,106,910¥ 262,266¥ 440,867$ 1,968,227

Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.
3. Unrealized gains and losses on Other Securities have not been reflected in the financial statements as of March 31, 2001.

160

Thousands of
U.S. dollars
2002Non-Consolidated Statements of Operations
For the Fiscal Years ended March 31

2002

2001

Thousands of
U.S. dollars
2002

IncomeFiduciary Income
Interest Income
Securities
Call Loans
Fee and Commissions Income
Other Operating Income
Other Income¥39,235468
371
33
15,136227
6,093¥40,202
1,051
464
475
13,633576
164$294,454
3,518
2,786
254
113,597
1,707
45,733

61,162

55,628459,009

202
6
4,398
32,467
31,172651
15797
33,87730,5281,517
48
33,009243,658
233,938

68,24065,854512,122

7,077

10,225

53,11333(3,066)35(4,152)

251(23,014)¥ 4,044¥ 6,107$ 30,350

Millions of yen

Total Income
Expenses
Interest Expenses
Deposits
Fee and Commissions Expenses
General and Administrative Expenses
Other Expenses
Total Expenses
Loss before Income Taxes
Income Taxes:
Current
Deferred
Net Loss
Notes: 1. The amounts indicated in millions of yen are rounded down by truncating the figures below one million.
2. The rate of ¥133.25=US$1.00, the foreign exchange rate on March 31, 2002, has been used for translation.

161

Senior Executive Officers of Mizuho

Mizuho Holdings
Board of Directors
Terunobu Maeda*
President & CEO

Yuji Watanabe*
Deputy President

Tadashi Hashimoto

Takashi Okamoto*Executive Officer

Deputy President

General Manager, Credit Risk Management
Department

Akira Miyagawa*Yoshiaki Sugita
Executive Officer

Tsutomu Abe*

Assistant to Head of IT, Systems & Operations
Group

Senior Managing Director

Head of Audit and Compliance Group /Chief Compliance Officer

Tadao Noda*

Yukio Obara*
Deputy President
Head of IT, Systems & Operations Group /Chief Information Officer

Hiroshi Saito
Director

Tadashi Kudo
Director

Yoshiharu Fukuhara

Mizuho Corporate Bank
Board of Directors
Hiroshi Saito*
President & CEO

Nobuhiro Mori*
Deputy President, Chief Compliance Officer /Kazumi Yanagihara*
Senior Managing Director

Corporate Auditors
Hajime Sakuma
Corporate Auditor

Masahiro Sakaguchi

Head of Audit & Compliance Group

Corporate Auditor

Toshiaki Ohuchi*

Minoru Nakai

Deputy President

Corporate Auditor

Teruhiko Ikeda*

Toshiaki Hasegawa

Deputy President

Director

Michio Shishido*

Glen S. Fukushima

Senior Managing Director,
Chief Credit Officer /Director

Yoshiro Aoki*
Senior Managing Director

Deputy President
Head of Risk Management Group /Chief Risk Officer

Deputy President

Corporate Auditor

Mizuho Securities

Head of Credit

Board of Directors

Corporate Auditors

Ikuo Kaminishi*
Senior Managing Director /Takasuke Kaneko

Yoriaki Sakata

Head of Corporate Banking Business Unit

Chairman

Corporate Auditor

Michio Ueno*

Tomohiro Kamio

Minoru Nakai

Senior Managing Director /Vice Chairman

Corporate Auditor

Head of International Banking Business Unit

Setsuo Umezawa

Corporate Auditors

Corporate Auditor

Yukio Nozaki
Corporate Auditor

Toshiaki Hasegawa
Corporate Auditor

Koji Toda
Corporate Auditor

Hidemi Ueda
Corporate Auditor

Yoshio Osawa
President

Takayasu Tanaka
Deputy President

Shinji Ichishima
Deputy President

Yukio Nozaki

Executive Officers

Corporate Auditor

Takao Suzuki

Yoriaki Sakata

Senior Managing Executive Officer

Corporate Auditor

Head of Strategic Planning Group /Chief Strategy Officer

Takashi Goto

Mitsuru Machida

Board of Directors
Yasuo Noda

Mizuho BankManaging Executive Officer
Head of Human Resources Group, and concurrently Head of Post-retirement Counseling
Office / Chief Human Resources Officer

Mizuho Trust & Banking

Board of Directors
Tadashi Kudo*
President & CEO

Managing Executive Officer

Masaaki Sato*

Head of Financial Control and Accounting
Group / Chief Financial Officer

Deputy President

Chairman & CEO

Hiromichi Tsuda
President & CEO

Takeo Sekihara
Deputy President

Notes: 1. The Directors concurrently serving as the Executive Officers.
*
2. The Executive Officers, excluding the Directors concurrently serving as the Executive Officers of Mizuho Corporate Bank and Mizuho Bank, have not been listed.
3. Members of the Board of Directors other than the Chairman, the Vice Chairman, the President, and the Deputy Presidents, as well as the Corporate Auditors and the Executive Officers ofMizuho Securities, have not been listed.
4. Members of the Board of Directors other than the Chairman & CEO, the President & CEO, and the Deputy President, as well as the Corporate Auditors and the Executive Officers of Mizuho Trust& Banking, have not been listed.

(As of July 31, 2002)
162

Office Network of Mizuho

Domestic Network of Mizuho(as of April 1, 2002)

Mizuho Holdings

Mizuho Bank

Mizuho Trust & Banking

Head Office

Head Office and Branches: 580
Sub-branches: 91
Agencies: 7

Head Office and Branches: 8
Sub-branches: 6

Mizuho Corporate Bank
Domestic Network: 33 (Includes head
office and 15 offices specializing incollection of accounts receivable)

Mizuho Securities
Head OfficeInternational Network of Mizuho
Branches, Agencies andRepresentative Offices
The Americas
New York Branch
1251 Avenue of the Americas,
New York, NY 10020, U.S.A.
TEL 1-212-282-3000

New York Broadway Branch
1633 Broadway, 40th Floor, New York,NY 10019, U.S.A.
TEL 1-212-649-0300

New York Park Avenue Branch
55 E. 52nd Street, New York, NY 10055, U.S.A.
TEL 1-212-898-2000

Chicago Branch
AT&T Corporate Center,Suite 2600, 227 WestMonroe Street, Chicago, IL 60606, U.S.A.
TEL 1-312-855-1111

Atlanta Representative Office
One Ninety One Peachtree Tower, Suite 3825,
191 Peachtree Street, N.E., Atlanta, GA 30303,
U.S.A.
TEL 1-404-524-8770(as of July 31, 2002)

Colombia Representative Office

Shanghai Branch

Carrera 7 No.71-52, Torre B. Piso 9, Santafe de
Bogota, D.C. Colombia

25th Floor, HSBC TOWER., 101 Yin Cheng
East Road, Pudong New Area, Shanghai
200120, The People's Republic of China
TEL 86-21-6841-0001

Caracas Representative Office
Avenida Principal con 1 ra,Transversal de laCastellana, Torre Banco de Lara, Piso 11, Oficina
B, La Castellana, Municipio Autònomo Chacao,
Apartado Del Este 60128, Caracas 1060,
Venezuela

Buenos Aires Representative Office
Av. Dávila 270, Piso 2°, Puerto Viamonte 2, 1107
Buenos Aires, Argentina

Europe and the Middle East
London Branch

Dalian Branch
6th Floor, Senmao Building, Zhongshan
Road 147, Xigang District, Dalian 116011, The
People's Republic of China
TEL 86-411-3602543

Beijing Branch
8th Floor, Chang-Fu-Gong Office Building, Jia 26,
Jianguomenwai Street, Chaoyang District,
Beijing 100022, The People's Republic of China
TEL 86-10-6513-9026

Shenzhen BranchRiver Plate House, 7-11 Finsbury Circus,
London EC2M 7DH, UK
TEL 44-20-7012-4000

21st Floor, Shenzhen International Financial
Building, Jian She Lu, Shenzhen, Guangdong
Province, The People's Republic of China
TEL 86-755-82221918

Paris Branch

Tianjin Representative Office

Washington Plaza 40, rue Washington, 75408
Paris Cedex 08, France
TEL 33-1-5383-4100

Room 2202, Tianjin International Building 75,
Nanjing Road, Tianjin,
The People's Republic of China
TEL 86-22-23305448

Düsseldorf Branch
Königsallee 60 D, 40212 Düsseldorf,
F.R. Germany
TEL 49-211-13020

Nanjing Representative Office

One Houston Center, Suite 4100,
1221 McKinney Street, Houston,
Texas 77010, U.S.A.
TEL 1-713-759-1800

Milan Branch

Room 801, Nanjing Grand Hotel, 208 Guangzhou
Road. Nanjing, Jiangsu Province, The People's
Republic of China
TEL 86-25-3329379

Via Senato 14/16, 20121 Milan, Italy
TEL 39-02-760-861

Wuhan Representative Office

Los Angeles Agency

Madrid Branch

350 South Grand Avenue, Suite 1500,
Los Angeles, CA 90071, U.S.A.
TEL 1-213-243-4500

Torre Picasso Planta 9,
Plaza Pablo Ruiz Picasso, 1 AZCA,
28020 Madrid, SpainTEL 34-91-597-2612

Houston Agency

San Francisco Representative Office
One Market, Spear Tower, Suite 1610,
San Francisco, CA 94105, U.S.A.
TEL 1-415-981-3131

Panama Branch
Plaza Internacional, Vía España,
P.O.Box 2637, Panama 9A,
Republic of Panama
TEL 507-269-6111

Mexico Representative Office
Edificio Omega, Campos Eliseos No.345-11,
Col. Chapultepec Polanco, Deleg. Miguel Hidalgo,
11560 Mexico, D.F., Mexico
TEL 52-55-5281-5037

São Paulo Representative Office
Avenida Paulista,1274-11˚ andar, CEP.01310-926,
São Paulo, SP, Brazil
TEL 55-11-251-4199

Bahrain Representative Office
Suite 201-202, Entrance 4,
2nd Floor Manama Center,
Manama, Bahrain(P.O. BOX 5759, Manama, Bahrain)
TEL 973-224522

Tehran Representative Office
3rd Floor, No.1, 14th Street,
Khaled Eslamboli Avenue, Tehran 15117, IranTEL 98-21-872-6593

Room 305, Holiday Inn Tian-an Wuhan,
868 Jiefang Dadao, Wuhan 430022,
The People's Republic of China
TEL 86-27-8582-1155

Xiamen Representative Office
Room 915, East Ocean Building Hotel, No.1
Building, Zhongshan Road, Xiamen, Fujian
361001, The People's Republic of China
TEL 86-592-202-1111

Guangzhou Representative Office
12th Floor, Garden Tower, 368 Huanshi
Dong Lu, Guangzhou 510064,
The People's Republic of China
TEL 86-20-8385-8000

Hong Kong Branch

Asia and Oceania

17th Floor, Two Pacific Place, 88 Queensway,
Hong Kong, S.A.R.,
The People's Republic of China
TEL 852-2103-3000

Seoul BranchTaipei Branch

Nae Wei Building, 6, 2-ka, Eulji-ro,
Chung-ku, Seoul, Republic of Korea
TEL 822-3782-8500

2nd Floor, Hung Kuo Building, 167 Tun Hua
North Road, Taipei 105, Taiwan
TEL 886-2-2715-3911

Note : All overseas offices are those of Mizuho Corporate Bank except for offices as indicated as follows:* Subsidiary of Mizuho Securities** Subsidiary of Mizuho Trust & Banking

163

Office Network of Mizuho

Kaohsiung Branch

Subsidiaries

12th Floor, No.2, Chung Cheng 3rd Road,
Kaohsiung 800, Taiwan
TEL 886-7-236-8768

DKB Investment Management
International Limited

Mizuho Corporate Bank (Canada)

Edinburgh One, Morrison Street, Edinburgh, EH3
8BE, UK
TEL 44-131-655-3200

Manila Branch
26th Floor, Citibank Tower, Valero Street corner
Villar Street, Salcedo Village, Makati City,
Metro Manila, Philippines
TEL 63-2-848-0001

Hanoi Branch
Suite 403~407, 63 LTT Building,
63 Ly Thai To Street, Hanoi,
Socialist Republic of Vietnam
TEL 84-4-826-6553

Ho Chi Minh City Representative
Office7th Floor, The Landmark, 5B Ton Duc Thang
Street, District 1, Ho Chi Minh City,
Socialist Republic of Vietnam
TEL 84-8-8228-638

Suite1102, 100 Yonge Street, Toronto, Ontario,
Canada M5C 2W1
TEL 1-416-874-0222

Mizuho Corporate Bank of California
555 West Fifth Street, Los Angeles,
CA 90013, U.S.A.
TEL 1-213-612-2700

The Fuji Bank and Trust Company
Park Avenue Plaza 55 East 52nd Street,
New York, NY 10055, U.S.A.
TEL 1-212-898-2000

The Industrial Bank of Japan Trust
Company
1251 Avenue of the Americas, New York,NY 10020, U.S.A.
TEL 1-212-282-3030

Bangkok Branch

Mizuho Capital Markets Corporation

18th Floor, TISCO Tower,
48 North Sathorn Road, Silom,
Bangrak, Bangkok 10500, Thailand
TEL 66-2-638-0200

1440 Broadway, 25th Floor, New York, NY 10018,
U.S.A.
TEL 1-212-547-1500

Labuan Branch
Level 9 (B) & (C), Main Office Tower, Financial
Park Labuan, Jalan Merdeka, 87000 Federal
Territory of Labuan, Malaysia
TEL 60-87-417766

Mizuho Securities USA Inc.*
Waterfront Corporate Center, 111 River Street
11th Floor, Hoboken, NJ 07030, U.S.A.
TEL 1-201-626-1000

The Bridgeford Group, Inc.*

Labuan Branch,Kuala Lumpur
Marketing Office

445 Park Avenue, 20th Floor, New York, NY
10022, U.S.A.
TEL 1-212-705-0880

Level 34, Menara Maxis, Kuala Lumpur City
Centre, 50088 Kuala Lumpur, Malaysia
TEL 60-3-2070-6880

Mizuho Trust & Banking Co.(USA) **Kuala Lumpur Representative Office
Level 34, Menara Maxis, Kuala Lumpur City
Centre, 50088 Kuala Lumpur, Malaysia
TEL 60-3-2070-6595

666 Fifth Avenue, Suite 802, New York,NY 10103 , U.S.A.
TEL 1-212-373-5900

DLIBJ Asset Management U.S.A. Inc.

Singapore Branch1133 Avenue of the Americas, 28th Floor,
New York, NY 10036, U.S.A.
TEL 1-212-350-7650

168 Robinson Road, #13-00 Capital Tower,
Singapore 068912, Republic of Singapore
TEL 65-6423-0330

Mizuho Corporate Bank Nederland
N.V.

Mumbai Branch

Apollolaan 171, 1077 AS Amsterdam,
The Netherlands
TEL 31-20-5734343

Maker Chamber III, 1st Floor, Jamnalal Bajaj Road,
Nariman Point, Mumbai, 400021 India
TEL 91-22-288-6638

New Delhi Representative Office
DBS Business Centre, 1st Floor, World Trade
Tower, Barakhamba Lane, New Delhi 110 001
India
TEL 91-11-341-2190

Sydney Branch
Level 33, 60 Margaret Street, Sydney, N.S.W. 2000,
Australia
TEL 61-2-8273-3888

Yangon Representative Office
7th Floor, FMI Centre, No.380, Bogyoke Aung San
Street, Yangon, Myanmar
TEL 95-1-243-009

Jakarta Representative Office
Plaza BII Menara 2, 24th Floor, JI. M.H. Thamrin
No. 51, Jakarta 10350, Indonesia
TEL 62-21-392-9535

Mizuho Corporate Bank (Germany)
Aktiengesellschaft
Taunustor 2,60311 Frankfurt am Main,
F.R. Germany
TEL 49-69-27282-0

Mizuho Capital Markets (UK) Limited

Bracken House, One Friday Street, London, EC4M
9JA, UK
TEL 44-207-776-6400

DLIBJ Asset Management
International Ltd.
Bracken House, One Friday Street, London, EC4M
9JA, UK
TEL 44-20-7329-3777

PT. Bank Mizuho Indonesia
Plaza Bll Menara 2, 24th Floor, Jl. M.H. Thamrin
No. 51, Jakarta 10350, Indonesia
TEL 62-21-392-5222

Mizuho Corporate Asia (HK) Limited
17th Floor, Two Pacific Place, 88 Queensway,
Hong Kong, S.A.R., The People's Republic of China
TEL 852-2103-3040

Chekiang First Bank Ltd.
Chekiang First Bank Bldg., 60 Gloucester Road,
Hong Kong, S.A.R., The People's Republic of China
TEL 852-2922-1222

Mizuho Corporate Leasing (Thailand)Co., Ltd.
19th Floor, TISCO Tower 48/44 North Sathorn
Road, Silom, Bangrak, Bangkok 10500, Thailand
TEL 662-638-0900

P.T. Dai-Ichi Kangyo Panin Leasing
6th Floor, Panin Bank Centre, Jalan Jenderal
Sudirman (Senayan), Jakarta 10270, Indonesia
TEL 62-21-725-0285

P.T. Jaya Fuji Leasing Pratama
9th Floor, Jaya Bldg., Jalan, M.H. Thamrin 12,
Jakarta 10340, Indonesia
TEL 62-21-331-750

P.T. Bumi Daya-IBJ Leasing
Plaza Bumi Daya, 16th Floor, Jl. Iman Bonjol
No.61, Jakarta 10310, Indonesia
TEL 62-21-315-5711

Mizuho Corporate Asia (Singapore)
Limited168 Robinson Rd, #11-02 Capital Tower,
Singapore 068912, Republic of Singapore
TEL 65-6416-0290

Mizuho Capital Markets (HK) LimitedRiver Plate House, 7-11 Finsbury Circus, London
EC2M 7DH, UK
TEL 44-20-7972-9900

2502, Gloucester Tower, The Landmark 11 Pedder
Street, Central, Hong Kong, S.A.R.,
The People's Republic of China
TEL 852-2537-3815

Mizuho Corporate Bank-BA
Investment Consulting GmbH

Mizuho Securities Asia Limited*

Landhausgasse 4/7, 1010 Vienna, Austria
TEL 43-1-5355868

Mizuho International plc*
Bracken House, One Friday Street,
London EC4M 9JA, UK
TEL 44-20-7236-1090

Mizuho Bank (Switzerland) Ltd.*
Loewenstrasse 32, 8023 Zurich, Switzerland
TEL 41-1-216-9111

Mizuho Trust & Banking(Luxembourg) S.A.**
1B, Parc d'Activité Syrdall, L-5365 Munsbach,Luxembourg
TEL 352-4216171

164

Fuji Investment Management
Company (Europe) Limited

Suites 901-907, CITIC Tower,
1 Tim Mei Avenue, Central, Hong Kong, S.A.R.,
The People's Republic of China
TEL 852-2685-2000

Mizuho Futures (Singapore) Pte.
Limited*Six Battery Road, #18-05 Singapore 049909,
Republic of Singapore
TEL 65-221-3633

Investor Information on Mizuho Holdings

Date of Establishment

Accounting Auditors

September 29, 2000

Shin Nihon & Co.

Paid-in Capital

Transfer Agent¥2,572,000 million

Mizuho Trust & Banking Co., Ltd.

Outstanding SharesFiscal Year

10,493,250.71 shares
Common Shares : 9,430,250.71 shares
Preferred Shares :1,063,000 shares

April 1 to March 31

Convocation of General Meetings of Shareholders
A regular general meeting of shareholders of the Company
shall be convened no later than three months from the last
day of each business year, and an extraordinary general
meeting of shareholders shall be convened whenevernecessary.

Number of Shareholders
Common Shares : 199,590
Preferred Shares :9

Principal Shareholders (Common Stock)
Percentageof shares
outstanding
Shares held(%)

The Dai-ichi Mutual Life Insurance
Company

379,158.00

4.02

Japan Trustee Services Bank, Ltd.
(Trust account)

324,913.00

3.44

The Mitsubishi Trust and Banking
Corporation (Trust account)245,488.00

2.60

NIPPON LIFE INSURANCECOMPANY

227,143.76

2.40

THE YASUDA MUTUAL LIFE
INSURANCE COMPANY

188,230.00

1.99

UFJ Trust Bank Limited(Trust account A)

176,030.00

1.86

Asahi Mutual Life Insurance
Company

175,608.00

1.86

The Yasuda Fire and Marine
Insurance Co., Ltd.

104,694.00

1.11

Nippon Steel Corporation

80,523.00

0.85

Hitachi, Ltd.

78,870.00

0.83(as of March 31, 2002)

Stock Listings
Tokyo Stock Exchange
Osaka Securities Exchange
London Stock Exchange

Record Date
The Company shall deem shareholders having voting rights
appearing in writing or digitally on the last register of shareholders (including the register of beneficial shareholders; thesame shall apply hereinafter) as of March 31 of each year as
the shareholders who shall be entitled to exercise their rights
at the regular general meeting of shareholders for the relevant fiscal term.
In addition to the preceding paragraph, the Company may
temporarily set the record date whenever necessary, pursuant
to a resolution of the Board of Directors and upon giving aprior public notice thereof.

Dividends
Dividends on shares shall be paid to the shareholders or
registered pledgees appearing in writing or digitally on thelast register of shareholders as of March 31 of each year or tothe holders of fractional shares appearing in writing or digitally on the last register of holders of fractional shares as ofMarch 31 of each year.

Interim Dividends
The Company may, by a resolution of the Board of Directors,
make cash distributions pursuant to the provisions of Article
293-5 of the Commercial Code (referred to as “Interim
Dividends” in these Articles of Incorporation) to the shareholders or registered pledgees appearing in writing or digitally on the last register of shareholders as of September 30
of each year or to the holders of fractional shares appearing
in writing or digitally on the last register of holders of fractional shares as of September 30 of each year.

165

Disclosure Policy of Mizuho

Mizuho Holdings aims to provide customers and shareholders
with various information on the Mizuho Financial Group’s“value.” Voluntary, Proactive Disclosure
One of our basic principles is to maximize shareholders' value and earn the trust of society at large as the leader of Japan’s
financial services industry. For this reason, we attach the highest management priority to disclosing to our customers, shareholders and investors in Japan and overseas the information they need to form accurate judgments and appraisals of MHFG’s
status at any given time.
Since we aim to become an innovative financial services group that will lead the new era through cutting-edge comprehensive financial services, we are committed to fair, timely and ongoing disclosure as a means of achieving levels of managementtransparency that surpass global standards.
Specifically, we intend to use the following tools to promote further understanding of group activities:• IR meetings and other briefings by members of top management, and disclosure of the meetings on our Web site.
• More detailed annual reports and publications on group performance.
• Diversification and effective use of disclosure channels such as our Web site, conference calls and Internet conferencing.

Mizuho's IR Home Page

 Disclosure in Connection with ComplianceIn accordance with the provisions of the Japanese Banking Law, the Securities and Exchange Law and the regulations laid down
by stock exchanges in Japan and around the world, we will endeavor to disclose pertinent information in a timely and appropriate manner.

166

Contact Information

Mizuho Holdings, Inc.
Marunouchi Center Building,
1-6-1, Marunouchi,
Chiyoda-ku, Tokyo 100-8208,
Japan
Tel. +81-(0)3-5224-1111
URL: http://www.mizuho-fg.co.jp/

Mizuho Corporate Bank, Ltd.
1-3-3, Marunouchi,
Chiyoda-ku, Tokyo 100-8210,
Japan
Tel. +81-(0)3-3214-1111
URL: http://www.mizuhocbk.co.jp/

Mizuho Bank, Ltd.
1-1-5, Uchisaiwaicho,
Chiyoda-ku, Tokyo 100-0011,
Japan
Tel. +81-(0)3-3596-1111
URL: http://www.mizuhobank.co.jp/

Mizuho Securities Co., Ltd.
Otemachi First Square,
1-5-1, Otemachi,
Chiyoda-ku, Tokyo 100-0004,
Japan
Tel. +81-(0)3-5208-3210
URL: http://www.mizuho-sc.com/

Mizuho Trust & Banking Co., Ltd.
Shinmarunouchi Building,
1-5-1, Marunouchi,
Chiyoda-ku, Tokyo 100-8240,
Japan
Tel. +81-(0)3-3240-7000
URL: http://www.mizuho-tb.co.jp/

P rinte d in Ja pa n