February 14, 2017

Financial Results for the Nine Months Ended December 31, 2016
Asahi Mutual Life Insurance Company (the “Company”; President: Yoshiki Sato) announces
financial results for the nine months ended December 31, 2016

［Contents］

１．Business Highlights

･････

Ｐ１

２．Investment Results of General Account Assets

･････

Ｐ３

３．Non-consolidated Balance Sheets

･････

Ｐ６

４．Non-consolidated Statements of Income

･････

Ｐ７

５．Breakdown of Ordinary Profit (Fundamental Profit)･････ Ｐ１０

６．Solvency Margin Ratio･････ Ｐ１１

７．Status of Separate Account･････ Ｐ１２

８．Status of the Company, Subsidiaries and Affiliates･････ Ｐ１３

Asahi Mutual Life Insurance Company

1．Business Highlights(1) Policies in Force and New Policies(i) Policies in Force
As of March 31, 2016

As of December 31, 2016
Number of policies

Number of policies

Amount(Thousands)(100 millions of Yen)

Amount (100 millions of Yen)

Changes(%, Pre-FYE)(Thousands)

Changes(%, Pre-FYE)

Individual insurance

7,140

199,116

7,135

99.9

185,254

93.0

Individual annuities

630

28,171

623

98.9

27,29496.9

Group insurance-

13,310--13,201

99.2

Group annuities

-

197

-

-

189

95.7

Notes:
1. Policy amounts for individual annuities are equal to (a) the funds to be held at the time annuity payments are to commence for an annuity
for which annuity payments have not yet commenced and (b) the amount of policy reserves for an annuity for which payments havecommenced.
2. Policy amount in force for group annuities is equal to the amount of outstanding policy reserves.
3. Number of policies includes number of each unit with regard to "Hoken-ou" , "Hoken-ou Plus", etc.

(ii) New Policies
Nine months ended December 31, 2015
Amount (100 millions of Yen)

Number of policies

New
policies(Thousands)

Net increase by
conversion

Individual insurance

546

2,050

3,626

△ 1,576

Individual annuities

12

413

455

△ 41

Group insurance

-

101

101

-

Group annuities

-

-

-

-

Nine months ended December 31, 2016
Number ofpolicies(Thousands)

Amount (100 millions of Yen)
Changes(%, YoY)

Changes(%, YoY)

New
policies

Net increase by
conversion

Individual insurance

549

100.6

1,149

56.1

2,929

△ 1,780

Individual annuities

15

121.6

437

105.7

575

△ 138

Group insurance

-

-

36

36.0

36

-

Group annuities

-

-

-

-

-

-

Notes:
1. Number of new policies is the sum of new policies and policies after conversion.
2. Amount of new policies for individual annuities, both new policies and net increase by conversion, is equal to
the funds to be held at the time annuity payments are to commence.
3. Number of policies includes number of each unit with regard to "Hoken-ou" , "Hoken-ou Plus", etc.

1Asahi Mutual Life Insurance Company

(2) Annualized Premiums(i) Policies in Force(100 millions of Yen）

As of December 31, 2016
As of March 31, 2016

Changes(%, Pre-FYE)

Individual insurance

3,721

3,731

100.2

Individual annuities

1,667

1,624

97.4

Total

5,389

5,356

99.4

1,836

1,923

104.7

Third-sector products(ii) New Policies(100 millions of Yen）

Nine months ended
December 31, 2015

Nine months ended
December 31, 2016

Changes(%, YoY)

Individual insurance

200

230

114.8

Individual annuities

16

16

100.1

Total

216

246

113.7

152

183

120.7

Third-sector products

Notes:
1. Annualized premiums are calculated by using coefficients based on the premium payment method. (For single
premium contracts, the amount is calculated by dividing the premium by the coverage period.)
2. Figures for third-sector products represent portion of annualized premiums corresponding to the medical
benefits (hospitalization benefits, surgery benefits, etc.), living benefits (specific illness benefits, nursing
care benefits, etc.) and waiver benefits (excluding disabilty benefits, but including specific illness benefits,nursing care benefits).

2

Asahi Mutual Life Insurance Company

２．Investment Results of General Account Assets(Millions of Yen)

As of March 31, 2016
AmountAs of December 31, 2016

Percentage

AmountPercentage

Cash, deposits, call loans

212,806

3.9

204,195

3.6

Monetary claims bought

41,9060.8

34,504

0.6

-

-

-

-

4,110,943

74.8

4,276,977

76.4

Domestic bonds

2,896,543

52.7

2,934,990

52.5

Domestic stocks

238,780

4.3

278,1105.0

Foreign securities

904,201

16.5

987,312

17.6

Foreign bonds

690,48112.6

782,81514.0

Foreign stocks and other foreign securities

213,7203.9

204,497

3.7

71,417

1.3

76,5641.4

620,98811.3

571,978

10.2

Policy loans

68,813

1.3

59,377

1.1

Industrial and consumer loans

552,175

10.0

512,601

9.2

Real estate

412,702

7.5

402,676

7.2

Deferred tax assets

22,7440.4

27,301

0.5

Others73,9991.3

77,659

1.4

Allowance for possible loan losses

△578

△0.0

△508

△0.0

5,495,513

100.0

5,594,785

100.0

826,169

15.0

1,027,371

18.4

Monetary trusts
Securities

Other securities
Loans

Total
Foreign currency-denominated assets

Notes:
Real estate is the sum of land, buildings and construction in progress.

3

Asahi Mutual Life Insurance Company

(2) Fair Value Information on Securities (with fair value, other than trading securities)(Millions of Yen)

As of March 31, 2016
Book value

Fair value

As of December 31, 2016

Gains/losses
Gains

Held-to-maturity debt securities
Policy-reserve-matching bonds
Stock of subsidiaries
Available-for-sale securities

410,888

Book value

Fair value

Gains/losses

LossesGains

469,869

58,981

58,981△0431,159

47,85947,937△78

2,236,439 2,675,317

438,878

438,878△0 2,199,609 2,570,945

371,336

382,613△11,277

-

-

-

-

-

-

-

1,300,882 1,381,849

80,966

115,534△34,567 1,530,118 1,608,457

78,338126,185△47,846--

383,299

Losses-Domestic bonds

442,035

452,393

10,357

11,217△859

541,680

542,335

654

8,317

△7,662

Domestic stocks

156,708

221,663

64,95481,052△16,097

152,595

260,045

107,450

113,093△5,643Foreign securities

626,439

636,374

9,935

22,842△12,907758,654729,511△29,1422,759△31,902

Foreign bonds

514,167

529,210

15,043

21,341△6,298651,588627,065△24,522

1,707△26,230

Foreign stocks andother foreign securities

112,271

107,164△5,107

1,501△6,609107,066

102,446△4,6191,052△5,67275,69971,417△4,281421△4,702

77,18776,564

△623

2,014

△2,638

Monetary claims bought

-

-

-

-

-

-

-

-

-

-

Negotiable certificate of deposits

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

3,948,210 4,527,036

578,826

613,394△34,567 4,113,027 4,610,562

497,534

556,736△59,2022,886,185 3,353,081

466,896467,756△860 2,934,335 3,319,831

385,495

404,488△18,992

Other securities

Total
Domestic bonds
Domestic stocks

156,708

221,663

64,95481,052△16,097

152,595

260,045

107,450

113,093△5,643Foreign securities

787,710

833,766

46,05558,963△12,907914,404

915,678

1,274

33,176△31,902

Foreign bonds

675,438

726,601

51,163

57,461△6,298807,338

813,232

5,894

32,124△26,230

Foreign stocks andother foreign securities

112,271

107,164△5,107

1,501△6,609107,066

102,446△4,6191,052△5,672Other securities

75,69971,417△4,281421△4,702

77,18776,564

△623

2,014

△2,638

Monetary claims bought

41,906

47,107

5,200

5,200

△0

34,50438,442

3,937

3,963

△25

Negotiable certificate of deposits

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

Note: The table above includes assets which are considered appropriate to deem as securities under the Financial Instruments and Exchange Act.

* Book value of securities without fair value is as follows:(Millions of Yen)

As of March 31, 2016

As of December 31,
2016

-

-

Unlisted foreign bonds--

Others

-

-

-

-

5,093

5,093

118,581

115,022

Held-to-maturity debt securities

Policy-reserve-matching bonds
Stock of subsidiaries
Available-for-sale securities
Unlisted domestic stocks (except over-the-counter stocks)

12,024

12,971

Unlisted foreign stocks (except over-the-counter stocks)

106,557

102,051

Unlisted foreign bonds--

Others--123,674

120,116

Total

4

Asahi Mutual Life Insurance Company

*The table below shows the sum of securities with fair value and without fair value (in case that securities without faie value areforeign currency-denominated, the fair value is calculated as the sum of book value and net gains (losses) on foreign exchange
valuation).
(Millions of Yen)

As of March 31, 2016
Book value

Fair value

As of December 31, 2016

Gains/losses
Gains

Held-to-maturity debt securities
Policy-reserve-matching bonds
Stock of subsidiaries
Available-for-sale securities

410,888

Book value

Fair value

Gains/losses

LossesGains

469,869

58,981

58,981△0431,159

47,85947,9372,236,439 2,675,317

438,878

438,878△0 2,199,609 2,570,945

371,336

382,613 △11,277

5,093

-

-

1,419,463 1,500,429

5,093

-

383,299

Losses

5,093

5,093

-

80,965

115,534 △34,568 1,645,141 1,723,480

78,338-△78-

126,185 △47,847

Domestic bonds

442,035

452,393

10,357

11,217△859

541,680

542,335

654

8,317

△7,662

Domestic stocks

168,732

233,687

64,95481,052 △16,097

165,566

273,017

107,450

113,093△5,643Foreign securities

732,996

742,931

9,934

22,842 △12,908

860,706

831,562△29,143

2,759 △31,903

Foreign bonds

514,167

529,210

15,043

21,341△6,298651,588627,065△24,522

1,707 △26,230

Foreign stocks andother foreign securities

218,828

213,720△5,1081,501△6,610209,117

204,497△4,620

1,052△5,67275,69971,417△4,281421△4,702

77,18776,564

△623

2,014

△2,638

Monetary claims bought

-

-

-

-

-

-

-

-

-

-

Negotiable certificate of deposits

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

4,071,884 4,650,709

578,825

613,394 △34,568 4,233,144 4,730,678

497,533

556,736 △59,202

2,886,185 3,353,081

466,896467,756

385,495

404,488 △18,992
113,093

Other securities

Total
Domestic bonds△860 2,934,335 3,319,831

Domestic stocks

173,825

238,780

64,95481,052 △16,097

278,110

107,450

Foreign securities

894,267

940,32246,05558,963 △12,908 1,016,455 1,017,729

1,273

33,176 △31,903

Foreign bonds

675,438

726,601

51,163

57,461△6,298807,338

813,232

5,894

32,124 △26,230

Foreign stocks andother foreign securities

218,828

213,720△5,1081,501△6,610209,117

204,497△4,620

1,052△5,672Other securities

75,69971,417△4,281421△4,702

77,18776,564

△623

2,014

△2,638

Monetary claims bought

41,906

47,107

5,200

5,200

△0

34,50438,442

3,937

3,963

△25

Negotiable certificate of deposits

-

-

-

-

-

-

-

-

-

-

Others

-

-

-

-

-

-

-

-

-

-

170,659△5,643

Notes: The table above includes assets which are considered appropriate to deem as securities under the Financial Instruments and Exchange Act.

(3) Fair Value Information on Monetary Trusts
The Company doesn't hold monetary trusts.

5

Asahi Mutual Life Insurance Company

３．Non-consolidated Balance Sheets(Millions of Yen)
As of March 31, 2016

Assets:Cash and deposits
Call loans
Monetary claims bought
Securities:（National government bonds）（Local government bonds）（Corporate bonds）（Domestic stocks）（Foreign securities）
Loans:
Policy loans
Industrial and consumer loans
Tangible fixed assets
Intangible fixed assets
Reinsurance receivables
Other assets
Deferred tax assets
Customers' liabilities under acceptances and guarantees
Allowance for possible loan losses
Total assets

（
（
（
（
（

32,670
181,000
41,906
4,138,558
2,067,291 ）
47,714 ）788,290 ）249,233 ）914,609 ）620,988
68,813552,175
417,790
30,74432
38,29922,74417△578
5,524,175
As of March 31, 2016

Liabilities:
Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders
Reinsurance payables
Other liabilities:
Income taxes payable
Lease obligations
Asset retirement obligations
OthersReserve for employees' retirement benefits
Reserve for price fluctuation
Deferred tax liabilities for land revaluation
Acceptances and guarantees
Total liabilities
Net assets:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Surplus:Reserve for future losses
Other surplus:
Reserve for fund redemption
Equalized reserve for dividends to policyholders
Unappropriated surplus (loss)
Total foundation funds and others
Net unrealized gains (losses) on available-for-sale securities, net of tax
Land revaluation differences
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets

6

As of December 31, 2016

（
（
（
（
（

27,916
178,000
34,504
4,304,527
1,970,322 ）
54,852 ）916,373 ）
288,971 ）997,443 ）
571,978
59,377
512,601
407,125
32,2183
41,24727,30115△508
5,624,331

As of December 31, 2016

4,887,317
27,9504,814,646
44,72095
215,470
53
2,472
237
212,706
39,09634,53018,56917
5,195,098

4,800,790
25,822
4,732,500
42,46669
386,286
3,698
1,888
240
380,459
38,29236,15018,271
15
5,279,876

126,000
120,000
281
64,368219
64,14935,500
10,485
18,163
310,650
62,953△44,527
18,426
329,077
5,524,175

126,000
131,000
281
67,584242
67,34236,0008,718
22,624
324,866
64,884△45,296
19,587344,4545,624,331

Asahi Mutual Life Insurance Company

４．Non-consolidated Statements of Income(Millions of Yen)

Ordinary income:Premium and other income:（Insurance premiums）（

Investment income:Nine months ended
December 31, 2015

Nine months ended
December 31, 2016

487,478504,717298,379

288,501

298,322 ）（95,690288,444 ）
116,894（Interest, dividends and other income）（

83,460 ）（79,574 ）（Gains on sales of securities）（

4,508 ）（

28,146 ）（Investment gains on separate accounts）

（

197 ）

（

2,119 ）

Other ordinary income
Ordinary expenses:
Claims and other payments:

93,40999,321

469,281475,429

349,463

348,053（Claims）（

103,584 ）（

102,928 ）（Annuities）（

92,668 ）（97,157 ）（Benefits）（

67,575 ）（69,855 ）（Surrender benefits）（

82,016 ）（71,867 ）（Other payments）（

3,496 ）（

6,055 ）

Provision for policy reserves and other reserves:
Provision for interest on policyholders' dividend reserves

Investment expenses:

35

32

35

32

19,831

26,219（Interest expenses）（

2,479 ）（

2,802 ）

（Losses on sales of securities）（

2,409 ）（

3,764 ）

（Losses on valuation of securities）

（

35 ）

（

16 ）

（Losses on derivative financial instruments）（

2,470 ）（

8,128 ）

Operating expenses

72,93075,570

Other ordinary expenses

27,02025,55318,19729,288

532

950

532

950

Ordinary profit
Extraordinary gains:
Gains on disposal of fixed assets
Extraordinary losses:

2,181

3,930

Losses on disposal of fixed assets

217

893

Impairment losses

423

1,157

1,540

1,620

-

259

Surplus before income taxes

16,54826,308

Income taxes including deferred taxes

3,271

5,306

Provision for reserve for price fluctuation
Other extraordinary losses

Total income taxes

3,271

5,306

Net surplus

13,27721,001

7

Asahi Mutual Life Insurance Company

Notes to the Non-consolidated Financial Statements
I. Notes to Non-consolidated Balance Sheet
１．Implementation Guidance on Recoverability of Deferred Tax Ａｓｓｅｔｓ
ASBJ Guidance No. 26 “Implementation Guidance on Recoverability of Deferred Tax Assets” has been applied
since the nine months period ended December 31, 2016.

２．Securities Lent under Lending Agreements
The amount of securities lent under lending agreements was \158,079 million as of December 31, 2016.

３．Reserve for Dividends to Policyholders
The changes in reserve for dividends to policyholders for the nine months ended December 31, 2016 were as
follows:(Millions of Yen)
Nine months ended December 31, 2016

¥44,720
1,767
4,053
32
¥42,466

Balance at the beginning of the reporting period・・・・・・・・・・・・・・・・
Transfer to reserve from surplus in the previous fiscal year・・・・・・・・・
Dividends to policyholders paid out・・・・・・・・・・・・・・・・・・・・・・・・・・
Increase in interest・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
Balance at the end of the reporting period・・・・・・・・・・・・・・・・・・・・・

４．Redemption of Foundation Funds
Accompanying the redemption of foundation funds totaling \11,000 million as of December 31, 2016 inaccordance with Article 56 of the Insurance Business Act, the Company transferred the same amount fromreserve for fund redemption to reserve for redemption of foundation funds.

５．Additional Foundation Funds
In accordance with Article 60 of the Insurance Business Act, the Company raised additional foundation funds
totaling \11,000 million as of December 31, 2016.

６．Issuance of U.S. Dollar-Denominated Perpetual Subordinated Bonds
The Company issued U.S. dollar-denominated step-up callable perpetual subordinated bonds (the “Bonds”)
on January 24, 2017.
Summary terms of the Bonds are as follows:(1) Type: U.S. dollar-denominated step-up callable perpetual subordinated notes with interest deferral options(2) Issue price: 100% of principal amount(3) Principal amount: USD 350 million(4) Interest rate: Fixed rate of interest of 7.25% per annum until January, 2022 and a fixed rate reset withstep-up thereafter (reset every 5 years).
(5) Maturity: None (perpetual). The Bonds are callable on each interest payment date on or after January,
2022 at the discretion of the Company, subject to prior approval by the regulatory authority, etc.
(6) Collateral and guarantee: The Bonds have no collateral and guarantee and there are no assets especiallyretained for the reimbursement of the Bonds.
(7) Use of proceeds: The Company intends to use the net proceeds from the Bonds for general corporate
purposes, and also (subject to regulatory and other approvals) apply such proceeds towards the partial
repayment of existing subordinated loans.
The Company applies designated hedge accounting (“Furiate-shori”) for currency swap for the Bonds.

8

Asahi Mutual Life Insurance Company

Ⅱ. Notes to Non-consolidated Statement of Income
１. Impairment Losses of Fixed Assets
For the nine months ended December 31, 2016, impairment losses of fixed assets by the Company were as
follows:(1) Method of grouping
Real estate and other assets used for insurance business operations are classified as one asset group as awhole. Other assets such as real estate for rent and unused real estate are classified as one groupindividually.

(2) Background information on recognizing impairment losses
As the profitability of certain real estate for rent dropped down significantly due to a decrease in the level ofrental income and a declining trend in the market prices of land, the Company reduced the book values ofsuch real estate for rent and unused real estate to their recoverable amounts. The write-downs wererecognized as impairment losses and included in extraordinary losses.

(3) Breakdown of impairment losses(Millions of Yen)

Purpose of use
Real estate for rent・・・・・・・・・・・・・・・・・・・・・・
Unused real estate・・・・・・・・・・・・・・・・・・・・・・
Total・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Land
¥332
325
¥658

Building
¥376
121
¥498

Total
\ 709
447
¥1,157(4) Calculation method of recoverable amountThe recoverable amounts of real estate for rent are determined at net realizable value or value in use. The
recoverable amounts for unused assets are net realizable value. Value in use is determined as the estimatednet future cash flows, reflecting the volatility risk, discounted at 3.6%. Net realizable value is calculated
based on the appraisal value after deduction of expected costs with reference to “Real Estate Appraisal
Standards” or the publicly announced appraisal value.

9

Asahi Mutual Life Insurance Company

５．Breakdown of Ordinary Profit (Fundamental Profit)(Millions of Yen)

Nine months ended Nine months ended
December 31, 2015 December 31, 2016
Fundamental profitＡ

18,163

12,075

4,508

29,652

Gains on monetary trusts--

Gains on trading securities--

Gains on sales of securities

4,508

28,146

Gains on derivative financial instruments--

Foreign exchange gains

-

1,505

Other capital gains

-

-

5,433

11,909Losses on monetary trusts--

Losses on trading securities--

Losses on sales of securities

2,409

3,764

35

16

2,470

8,128

517

-

-

-

Ｂ

△ 924

17,743

Ａ＋Ｂ

17,23929,819Other one-time gains

1,559

69

Reinsurance revenue--

Reversal of contingency reserve

-

-

1,559

69

-

-

601

600

-

-

600

600

Provision for specific allowance for possible loan losses--

Provision for allowance for specified overseas loans--

Write-offs of loans

10

Others

-

-

Ｃ

958

△ 531

Ａ＋Ｂ＋Ｃ

18,19729,288

Capital gains

Capital losses

Losses on valuation of securities
Losses on derivative financial instruments
Foreign exchange losses
Other capital losses
Net capital gains (losses)
Fundamental profit plus net capital gains (losses)

Reversal of specific allowance for possible loan losses
OthersOther one-time losses
Reinsurance premiums
Provision for contingency reserve

Other one-time gains (losses)
Ordinary profit

10

Asahi Mutual Life Insurance Company

６．Solvency Margin Ratio(Millions of Yen)

As of March 31, 2016

Total solvency margin（Ａ）

As of December 31, 2016

630,198

661,318

Foundation funds and surplus

303,096

319,416

Reserve for price fluctuation

34,53036,150Contingency reserve

29,182

29,78218

16

72,86970,504(in case of losses： × 100%)△ 37,103△ 37,614

Excess amount of policy reserve based on full-time Zillmer method

98,784

107,833

Qualifying subordinated debt

125,000

125,000

Excess amount of policy reserve based on full-time Zillmer method and qualifying subordinateddebt excluded from the calculation of solvency margin--

Deduction

-

-

3,821

10,229182,245

195,346

General allowance for possible loan losses(Net unrealized gains on available-for-sale securities (before tax effect) anddeferred hedge gains (before tax effect)) × 90% (in case of losses： × 100%)
Net unrealized gains on land × 85%

OthersTotal amount of risk

( R1  R8 ) 2  ( R2  R3  R7 ) 2  R4

（Ｂ）

Insurance risk

R1

16,045

15,341

Third sector insurance risk

R8

8,679

8,991

Risk of assumed yield

R2

85,74382,804

Minimum guarantee risk

R7

1,103

1,101

Investment risk

R389,651

105,608

Operational risk

R4

4,024

4,276

691.5%

677.0%

Solvency margin ratio(Ａ) / {(1/2)×(Ｂ)} × 100

Notes:
1. The figures above are calculated based on Articles 86 and 87 of the Ordinance for Enforcement of the Insurance Business Act and Notification of
the Ministry of Finance No. 50, 1996.
2. "Excess amount of policy reserve based on full-time Zillmer method", "Qualifying subordinated debt" and "Excess amount of policy reserve basedon full-time Zillmer method and qualifying subordinated debt excluded from the calculation of solvency margin" are calculated based on
Notification of the Financial Service Agency, No.25-1-1-1 of 2011, No.25-1-1-2 and No.25-1-1-3, respectively.
3. "Minimum guarantee risk" is calculated by standard method.

11

Asahi Mutual Life Insurance Company

７．Status of Separate Account(1) Separate Account Assets by Products(Millions of Yen)

As of March 31, 2016

As of December 31, 2016

Individual variable insurance

28,91029,727

Individual variable annuities--

Group annuity products--

28,91029,727Total(2) Policies in Force(i) Individual Variable Insurance
As of March 31,2016

AmountNumber of policies(Thousands)

Individual variable insurance(fixed-term)
Individual variable insurance(whole life)
Total

As of December 31, 2016

AmountNumber of policies(Thousands)(Millions of Yen)

(Millions of Yen)

0

32

0

9

15

104,87015

102,92215

104,903

15

102,931(ii) Individual Variable Annuities
As of March 31,2016

As of December 31, 2016

AmountNumber of policies(Thousands)

AmountNumber of policies(Thousands)(Millions of Yen)

(Millions of Yen)

Individual variable annuities

-

-

-

-

Total

-

-

-

-

12

Asahi Mutual Life Insurance Company

８．Status of the Company, Subsidiaries and Affiliates(1) Selected Financial Data
(Millions of Yen)

Nine months ended
December 31, 2015

Nine months ended
December 31, 2016

Ordinary income

490,446507,205

Ordinary profit

18,32829,285Net surplus attributable to the Parent Company

13,34020,942△ 10,757

23,578Comprehensive income(Millions of Yen)

As of March 31, 2016
Total assets
Solvency margin ratio

As of December 31, 2016

5,525,539

5,626,021

693.4%

679.5%(2) Scope of Consolidation and Application of Equity Method
Number of consolidated subsidiaries： 3

Unconsolidated subsidiaries and affiliates are immaterial in terms of their impact on consolidated net
income and surplus, and also immaterial as a whole, therefore, the equity method is not applied.

13

Asahi Mutual Life Insurance Company

(3) Consolidated Balance Sheets(Millions of Yen)

As of March 31, 2016

As of December 31, 2016

36,133
181,000
41,906
10
4,134,926
620,988417,845
30,38032
38,98623,88917△578
5,525,539

30,857
178,000
34,50404,300,867
571,978
407,185
31,992
3
42,6696
28,44815△508
5,626,021

Assets:Cash and deposits
Call loans
Monetary claims bought
Monetary trusts
Securities
Loans
Tangible fixed assets
Intangible fixed assets
Reinsurance receivables
Other assets
Net defined benefit assets
Deferred tax assets
Customers' liabilities under acceptances and guarantees
Allowance for possible loan losses

Total assets(Millions of Yen)

As of March 31, 2016

As of December 31, 2016

4,887,317
27,9504,814,646
44,72095
216,138
42,39934,53018,56917
5,199,069

4,800,790
25,822
4,732,500
42,46669
387,352
40,91536,15018,27115
5,283,564

126,000
120,000
281
64,102
310,384
62,954△44,527△2,42016,00679
326,470
5,525,539

126,000
131,000
281
67,259324,541
64,884△45,296△1,736
17,851
64
342,456
5,626,021

Liabilities:
Policy reserves and other reserves:
Reserve for outstanding claims
Policy reserves
Reserve for dividends to policyholders
Reinsurance payables
Other liabilities
Net defined benefit liabilities
Reserve for price fluctuation
Deferred tax liabilities for land revaluation
Acceptances and guarantees

Total liabilities
Net assets:
Foundation funds
Reserve for redemption of foundation funds
Reserve for revaluation
Consolidated surplus
Total foundation funds and others
Net unrealized gains (losses) on available-for-sale securities, net of tax
Land revaluation differences
Accumulated remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests

Total net assets
Total liabilities and net assets

14

Asahi Mutual Life Insurance Company

(4) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income【Consolidated Statements of Income】(Millions of Yen)

Nine months ended
December 31, 2015
Ordinary income:Nine months ended
December 31, 2016

490,446507,205

Premium and other income

298,379

288,501

Investment income:

95,435

116,639（Interest, dividends and other income）（

83,224 ）（79,335 ）（Gains on sales of securities）（

4,509 ）（

28,148 ）（Investment gains on separate accounts）

（

197 ）

（

2,119 ）

Other ordinaｒｙ income
Ordinary expenses:
Claims and other payments:

96,631102,065

472,118

477,919

349,463

348,053（Claims）（

103,584 ）（

102,928 ）（Annuities）（

92,668 ）（97,157 ）（Benefits）（

67,575 ）（69,855 ）（Surrender benefits）（

82,016 ）（71,867 ）（Other payments）（

3,496 ）（

6,055 ）

Provision for policy reserves and other reserves:
Provision for interest on policyholders' dividend reserves
Investment expenses:

35

32

35

32

19,832

26,220（Interest expenses）（

2,479 ）（

2,802 ）

（Losses on sales of securities）（

2,409 ）（

3,764 ）

（Losses on valuation of securities）

（

35 ）

（

16 ）

（Losses on derivative financial instruments）（

2,470 ）（

8,128 ）

Operating expenses

75,88578,208Other ordinary expenses

26,901

25,404

18,32829,285

532

950

532

950

2,181

3,931

Losses on disposal of fixed assets

218

894

Impairment losses

423

1,157

1,540

1,620

Other extraordinary losses-

259

Surplus before income taxes

16,67926,304

Income taxes including deferred taxes

3,310

5,339

Total income taxes

3,310

5,339

Net surplus

13,36920,96529

22

13,34020,942

Ordinary profit
Extraordinary gains:
Gains on disposal of fixed assets
Extraordinary losses:

Provision for reserve for price fluctuation

Net surplus attributable to non-controlling interests
Net surplus attributable to the Parent Company

15

Asahi Mutual Life Insurance Company

【Consolidated Statements of Comprehensive Income】
Nine months ended
December 31, 2015
Net surplus
Other comprehensive income:Net unrealized gains (losses) on available-for-sale securities,
net of tax
Remeasurements of defined benefit plans
Comprehensive income:Comprehensive income attributable to the Parent Company
Comprehensive income attributable to non-controllinginterests

16(Millions of Yen)
Nine months ended
December 31, 2016

13,36920,965△ 24,127

2,613△ 25,359

1,929

1,232

683

△ 10,757

23,578△ 10,787

23,55529

22

Asahi Mutual Life Insurance Company

Notes to the Consolidated Financial Statements
I. Notes to Consolidated Balance Sheet
１．Implementation Guidance on Recoverability of Deferred Tax Ａｓｓｅｔｓ
ASBJ Guidance No. 26 “Implementation Guidance on Recoverability of Deferred Tax Assets” has been applied
since the nine months period ended December 31, 2016.

２．Securities Lent under Lending Agreements
The amount of securities lent under lending agreements was \158,079 million as of December 31, 2016.

３．Reserve for Dividends to Policyholders
The changes in reserve for dividends to policyholders for the nine months ended December 31, 2016 were as
follows:(Millions of Yen)
Nine months ended December 31, 2016

¥44,720
1,767
4,053
32
¥42,466

Balance at the beginning of the reporting period・・・・・・・・・・・・・・・・
Transfer to reserve from surplus in the previous fiscal year・・・・・・・・・
Dividends to policyholders paid out・・・・・・・・・・・・・・・・・・・・・・・・・・
Increase in interest・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・
Balance at the end of the reporting period・・・・・・・・・・・・・・・・・・・・・

４．Redemption of Foundation Funds
Accompanying the redemption of foundation funds totaling \11,000 million as of December 31, 2016 inaccordance with Article 56 of the Insurance Business Act, the Company transferred the same amount fromreserve for fund redemption to reserve for redemption of foundation funds.

５．Additional Foundation Funds
In accordance with Article 60 of the Insurance Business Act, the Company raised additional foundation funds
totaling \11,000 million as of December 31, 2016.

６．Issuance of U.S. Dollar-Denominated Perpetual Subordinated Bonds
The Company issued U.S. dollar-denominated step-up callable perpetual subordinated bonds (the “Bonds”)
on January 24, 2017.
Summary terms of the Bonds are as follows:(1) Type: U.S. dollar-denominated step-up callable perpetual subordinated notes with interest deferral options(2) Issue price: 100% of principal amount(3) Principal amount: USD 350 million(4) Interest rate: Fixed rate of interest of 7.25% per annum until January, 2022 and a fixed rate reset withstep-up thereafter (reset every 5 years).
(5) Maturity: None (perpetual). The Bonds are callable on each interest payment date on or after January,
2022 at the discretion of the Company, subject to prior approval by the regulatory authority, etc.
(6) Collateral and guarantee: The Bonds have no collateral and guarantee and there are no assets especiallyretained for the reimbursement of the Bonds.
(7) Use of proceeds: The Company intends to use the net proceeds from the Bonds for general corporate
purposes, and also (subject to regulatory and other approvals) apply such proceeds towards the partial
repayment of existing subordinated loans.
The Company applies designated hedge accounting (“Furiate-shori”) for currency swap for the Bonds.

17

Asahi Mutual Life Insurance Company

II. Notes to Consolidated Statement of Income
１. Impairment Losses of Fixed Assets
For the nine months ended December 31, 2016, impairment losses of fixed assets by the Company were as
follows:(1) Method of grouping
Real estate and other assets used for insurance business operations are classified as one asset group as awhole. Other assets such as real estate for rent and unused real estate are classified as one groupindividually.

(2) Background information on recognizing impairment losses
As the profitability of certain real estate for rent dropped down significantly due to a decrease in the level ofrental income and a declining trend in the market prices of land, the Company reduced the book values ofsuch real estate for rent and unused real estate to their recoverable amounts. The write-downs wererecognized as impairment losses and included in extraordinary losses.

(3) Breakdown of impairment losses(Millions of Yen)

Purpose of use
Real estate for rent・・・・・・・・・・・・・・・・・・・・・・
Unused real estate・・・・・・・・・・・・・・・・・・・・・・
Total・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・

Land
¥332
325
¥658

Building
¥376
121
¥498

Total
\ 709
447
¥1,157(4) Calculation method of recoverable amountThe recoverable amounts of real estate for rent are determined at net realizable value or value in use. The
recoverable amounts for unused assets are net realizable value. Value in use is determined as the estimatednet future cash flows, reflecting the volatility risk, discounted at 3.6%. Net realizable value is calculated
based on the appraisal value after deduction of expected costs with reference to “Real Estate Appraisal
Standards” or the publicly announced appraisal value.

2. Depreciation
For the nine months ended December 31, 2016, the total amount of depreciation and depreciation of rental
real estate and other assets was ¥11,571 million.

18

Asahi Mutual Life Insurance Company

(5) Consolidated Solvency Margin Ratio(Millions of yen)

As of March 31, 2016

Total solvency margin（Ａ）

As of December 31, 2016

626,994

658,886

Foundation funds and surplus

303,302319,711

Reserve for price fluctuation

34,53036,150Contingency reserve

29,182

29,782

Catastrophe loss reserve--

General allowance for possible loan losses

20

18

72,87070,504△37,103△ 37,614△ 3,362△ 2,678

Excess amount of policy reserve based on full-time Zillmer method

98,784

107,833

Qualifying subordinated debt

125,000

125,000

-

-

△ 50

△ 50

3,821

10,229180,833

193,930(Net unrealized gains on available-for-sale securities (before tax effect) and deferredhedge gains (before tax effect)) × 90% (in case of losses： × 100%)
Net unrealized gains on land × 85%(in case of losses： × 100%)

Sum of unrealized actuarial differences and unrealized past service cost

Excess amount of policy reserve based on full-time Zillmer method and qualifying
subordinated debt excluded from the calculation of solvency margin
Deduction
OthersTotal amount of risk

(

2

2

1

5

R R R R ) ( R R R ) R R
2

8

9

2

2

3

7

4

6

（Ｂ）

Insurance risk

R1

16,045

15,341

Ordinary insurance risk

R5

-

-

Disaster insurance risk

R6

-

-

Third sector insurance risk

R8

8,679

8,991

Small amount short-term insurance provider insurance risk

R9

-

-

Risk of assumed yield

R2

85,74382,804

Minimum guarantee risk

R7

1,103

1,101

Investment risk

R388,253

104,209

Operational risk

R4

3,996

4,248

693.4%

679.5%

Solvency margin ratio(Ａ) / {(1/2)×(Ｂ)} × 100

Notes:
1. The figures above are calculated based on Articles 86-2 and 88 of the Ordinance for Enforcement of the Insurance Business Act and Notification of the
Financial Service Agency, No.23, 2011.
2. "Excess amount of policy reserve based on full-time Zillmer method", "Qualifying subordinated debt" and "Excess amount of policy reserve based on full-time
Zillmer method and qualifying subordinated debt excluded from the calculation of solvency margin" are calculated base on Notification of the Financial
Service Agency, No.25-4-1-1 of 2011, No.25-4-1-2 and No.25-4-1-3, respectively.
3. "Minimum guarantee risk" is calculated by standard method.

(6) Segment information
The Company and its consolidated subsidiaries operate investment advisory business etc, in addition to life insurance business in Japan.
However, information on these segments are omitted because they represent such a minor proportion of total segments.

19

Asahi Mutual Life Insurance Company