2022
ANNUAL REPORTThe Aichi Bank, Ltd.

PROFILE
Aichi Bank is a regional bank whose business base is Aichi Prefecture, the central prefecture of theTokai region, one of the country’s three main industrial areas. Since its establishment in 1910, theBank has worked to meet the diverse needs of customers in the region, based on its corporate missionof contributing to the prosperity of the community via a thorough commitment to sound management
and business growth.
Aichi Bank has a domestic service network comprising 106 branches, and also engages ininternational operations. The Bank’s head office is located in Nagoya, Aichi Prefecture, Japan’s fourthlargest prefecture by population, and an area that combines a beautiful natural environment with a richhistorical and cultural heritage.
As of March 31, 2022, the Bank had total assets of ¥4,320,749 million (US$35,303 million) on aconsolidated basis, and deposits amounting to ¥3,389,658 million (US$27,695 million). Its capital ratio,
calculated according to standards for banks operating only in Japan, stood at 9.95%.

FINANCIAL HIGHLIGHTS

Years ended March 31, 2022 and 2021
Millions of Yen

Consolidated

Thousands of U.S. Dollars

2022

2021

2022

2021

¥56,200¥53,296$459,187$435,460

Total expenses

40,82547,329333,564

386,706

Profit before income taxes

15,374

5,966

125,614

48,745

Profit attributable to owners of parent

10,945

4,266

89,42734,855¥3,389,658¥3,221,635$27,695,547$26,322,697

2,759,402

2,528,640

22,545,975

20,660,511

Securities

993,000

953,370

8,113,407

7,789,606

Total assets

4,320,749

3,788,132

35,303,121

30,951,319

239,512

246,391

1,956,957

2,013,162

For the year:

Total income

At year-end:
Deposits
Loans and bills discounted

Total net assets

Note: The U.S. dollar amounts represent translation of Japanese yen at the rate of ¥122.39 to U.S. $1.00 on March 31, 2022.

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MESSAGE FROM THE MANAGEMENTBusiness and Financial Conditions

Looking back at Japan’s economy during the year ended March 31, 2022, although economic
activity, such as face-to-face services, continued to stagnate amid challenging conditions inwhich the COVID-19 pandemic has been prolonged in addition to the impact of supply restrictions
remaining, the economy has continued to recover as exports and manufacturing have continued toincrease, which has led to improvements in corporate earnings.
On the other hand, as for the local economy of our business base, which is centered in Aichi
Prefecture, exports and manufacturing have come to a standstill as manufacturing in the automobile
industry, one of the major local industries, has not yet recovered due to disruptions in the component
supply chain because of the long-lasting semiconductor shortage and the spread of COVID-19.
Furthermore, with regard to personal consumption, the recovery of the economy is in a lull, which
differs from Japan overall, as there is strong downward pressure on restaurants, accommodation
services, etc.
Yukinori Ito, President
Looking forward, in regard to the economic outlook, we are expecting recovery due to the effectsof the economic measures, improvement in overseas economies, etc. amid the normalization ofsocioeconomic activity, despite increasing uncertainties, such as the spread of COVID-19 and the steady rise of energy prices, etc.
caused by the situation in Ukraine.
In the financial sector, the Bank of Japan works to support the cash flows of corporations, etc. and stably maintain financial
markets through special programs that support monetary easing in response to COVID-19 under “quantitative and qualitative
monetary easing with yield curve control,” and will not hesitate to take additional monetary easing measures if necessary.
Looking at the business environment surrounding the Bank, challenges have further increased due to factors such as competition
between banks, including financial institutions in other prefectures, steadily intensifying because of the advancement of thedevelopment of fintech and parties entering into the banking industry from other industries as well as both long- and short-term
interest continuing to remain low in the continuation of monetary easing measures amid a situation in which the end of COVID-19 isstill unable to be foreseen.
The Bank set four basic policies of “reinforce sales capabilities & profitability,” “increase productivity,” “reinforce human resources”
and “reinforce governance,” in the “Eleventh Medium-Term Management Plan,” which spanned from April 2019 until March 2022, andcarried out various initiatives with the aim of being a “bank that contributes to the local community as our customers’ partner.”

Earnings

Our business results on a consolidated basis for the year ended March 31, 2022 are as follows.
Total income increased ¥2,904 million year on year to ¥56,200 million (US$459 million) mainly due to increases in interest on loans
and bills discounted and purchased, interest on and dividends from securities and fees and commissions. Total expenses decreased¥6,504 million year on year to ¥40,825 million (US$333 million) mainly due to a decrease in provision of allowance for possible loan
losses. As a result, profit attributable to owners of parent increased ¥6,679 million year on year to ¥10,945 million (US$89 million).
By segment, ordinary income of the banking segment increased ¥2,939 million year on year to ¥47,463 million (US$387 million)
and its segment profit increased ¥9,635 million to ¥15,212 million (US$124 million). Ordinary income of the leasing segment
decreased ¥83 million year on year to ¥8,082 million (US$66 million), and its segment profit decreased ¥191 million to ¥144 million(US$1 million).

Cash FlowsNet cash provided by operating activities increased ¥279,864 million year on year to ¥314,587 million (US$2,570 million). This was
mainly attributable to increases in borrowings and call money and bills sold. Net cash used in investing activities decreased ¥110,378
million to ¥54,626 million (US$446 million). This was mainly attributable to purchases of securities. Net cash used in financing
activities amounted to ¥1,746 million (US$14 million), an increase in cash used of ¥646 million. This was mainly due to dividends paid.
As a result, cash and cash equivalents at the end of the year amounted to ¥482,440 million (US$3,941 million), an increase of¥258,215 million from the previous year-end.

Medium-term Strategy

In the “Twelfth Medium-Term Management Plan,” we have set the three basic strategies of “strengthen ability and channels forsolving issues (business strategy),” “increase efficiency of and optimize management (foundational strategy)” and “reform corporate
culture and develop human resources (human resources strategy),” aiming to “provide trustworthy and ideal financial services tocommunities, and become the leading bank in generating value that continues to grow together with the community.”
The specific details of each basic strategy are as follows:
1) “Strengthen ability and channels for solving issues (business strategy)”
We will support the transition to a carbon-free society and establish a business model that grows together with the community bydemonstrating our consulting function and strengthening channels that utilize digital technologies.
a. Strengthen consulting function by enhancing solutions menub. Enhance services for individualsc. Strengthen non-face-to-face channels
d. Establish sales structure appropriate for the market environment2) “Increase efficiency of and optimize management (foundational strategy)”
We will establish sustainability for management by increasing productivity and optimizing management resources, and aim forsustainable growth together with the community.
a. Strategic relocation of personnelb. Promotion of IT and the shift to digital, and increase operational efficiency (BPR)c. Display the Group’s comprehensive strengths
d. Enhance managerial control
3) “Reform corporate culture and develop human resources (human resources strategy)”
We will establish a corporate culture that places importance on speed and taking on challenges, and establish a rewarding,vibrant organization where all employees play an active role.
a. Establish a corporate culture that places importance on speed and taking on challenges
b. Develop professional human resourcesc. Strengthen initiatives for diversity & inclusiond. Strengthen initiatives for ES management and health and productivity management-2-

Yukinori Ito
President

BOARD OF DIRECTORS AND CORPORATE AUDITORS
President
Yukinori Ito

Directors
Audit and Supervisory Committee Members
Masahiro Kato*1
Yasutoshi Emoto*2
Yasuo Hasegawa*2
Yoshihiko Nakao*2
Tsunehiro Matsuno*2
Chieko Murata*2

Senior Managing Director
Nobuhiko Kuratomi
Managing Directors
Hiroyasu Matsuno
Hiroaki Yoshikawa
Directors
Kenichi Taguchi
Norimasa Suzuki
Kenji Ito

*1‌Standing Audit and Supervisory Committee Member*2‌Outside Audit and Supervisory Committee Member

CORPORATE DIRECTORY
Service Network
Head Office(Securities & Foreign Business Department)
14-12, Sakae 3-chome, Naka-ku, Nagoya 460-8678
Telephone: 81-52-251-3211
SWIFT: AICHJPJN
Facsimile: 81-52-262-5793

Domestic Branches

Gifu (3)Tokyo (1)Head Office
Shizuoka (1)Aichi (98)
Mie (2)
Osaka (1)Total 106 Domestic Branches
Consolidated Companies
Aigin Business Service Co., Ltd.
Aigin DC Card Co., Ltd.
Aigin Lease Co., Ltd.
Aigin Computer Service Co., Ltd.
Aichi Capital Co., Ltd.

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The Aichi Bank, Ltd.
Consolidated Financial Statements
March 31, 2022 and 2021

-4-

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Balance Sheets
March 31, 2022 and 2021
Millions of yen
2022
2021
Assets:Cash and due from banks¥ 484,775
Call loans and bills purchased
2,888
Monetary claims bought
7,238
Trading securities
49
Securities
993,000
Reserve for possible losses oninvestments(0)Loans and bills discounted
2,759,402
Foreign exchange
1,528
Other assets
37,397
Tangible fixed assets
34,191Intangible fixed assets
760
Employee retirement benefit asset
7,453
Deferred tax assets
195
Customers’ liabilities for acceptancesand guarantees
5,928
Allowance for possible loan losses(14,059)
Total assets¥ 4,320,749-5-¥

226,415590
3,090
953,370

Thousands of U.S. dollars
2022
2021

$

3,960,903
23,596
59,138400
8,113,407$

1,849,946
4,820
25,247
7,789,606(0)2,528,640
1,975
38,04435,050
1,002
7,461
185

(0)
22,545,975
12,484
305,556
279,361
6,209
60,8951,593(0)20,660,511
16,136
310,842286,379
8,186
60,9601,511

6,014(13,708)

48,435(114,870)

49,138(112,002)¥ 3,788,132$ 35,303,121$ 30,951,319

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Balance Sheets (Continued)
March 31, 2022 and 2021
Millions of yen
2022
2021
Liabilities:
Deposits¥ 3,389,658
Negotiable certificates of deposit
4,100
Call money and bills sold131,119
Security deposits received related tosecurities lending transactions
49,241
Borrowings
455,615
Foreign exchange
1,433
Other liabilities
23,149Reserve for employee bonuses
582
Reserve for bonuses to directors
35
Employee retirement benefit
535
liability
Reserve for executive retirement
benefits
44
Reserve for reimbursement ofdeposits
155
Reserve for contingencies
1,564
Deferred tax liabilities
13,475
Deferred tax liabilities forrevaluation
4,598
5,928
Acceptances and guarantees
Total liabilities
4,081,237
Net assets:
Common stock
Capital surplus
Retained earnings
Less treasury stock, at cost
Total shareholders’ equity
Accumulated other comprehensive
incomeStock acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets

Thousands of U.S. dollars
2022
2021

27,695,547
33,499
1,071,321$ 26,322,697
33,499-91,318
166,852
1,460
22,227587
35402,328
3,722,648
11,708189,1414,755
285

746,123
1,363,281
11,929181,607
4,796
285

683

4,371

5,580

35

359

285

188
1,449
20,484

1,266
12,778110,098

1,536
11,839167,366

4,668
6,014
3,541,740

37,56848,43533,346,163

38,14049,13828,938,148

18,00013,883
151,391(979)
182,295

18,00013,883142,074(1,055)
172,903

147,070
113,432
1,236,955(7,999)1,489,459

147,070
113,432
1,160,830(8,619)1,412,721

52,552
259
4,405
239,512¥ 4,320,749

68,850302
4,335
246,391¥ 3,788,132

429,3812,116
35,991
1,956,957$ 35,303,121

562,5452,467
35,4192,013,162$ 30,951,319-6-¥ 3,221,635
4,100
-

$

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Statements of Income
For the Years Ended March 31, 2022 and 2021
Millions of yen
2022
2021

Thousands of U.S. dollars
2022
2021

Income:Interest and dividend income:Interest on loans and bills discounted
and purchased¥
Interest on and dividends from securities
Other interest and dividend income
Total interest and dividend income
Fees and commissions
Other operating income
Other income
Total income

21,12810,655504
32,28817,575547
5,788
56,20019,1809,928
90
29,20017,106481
6,507
53,296$ 172,628
87,057
4,117
263,812
143,598
4,469
47,291
459,187

Expenses:
Interest expense:
Interest on deposits
Interest on call money and bills soldInterest on borrowings
Other interest expense
Total interest expense
Fees and commissions
Other operating expenses
General and administrative expenses
Impairment loss on fixed assets
Other expenses
Total expenses
Profit before income taxes

220
(11)
30
115
356
10,422
1,068
25,527186
3,264
40,825
15,374

250
21
60
16
351
10,4282,040
26,40950
8,049
47,329
5,966

1,797
(89)
245
939
2,908
85,154
8,726
208,570
1,519
26,668333,564
125,614

2,042
171
490
130
2,867
85,203
16,668215,777
408
65,765
386,706
48,745

4,342
11,031

1,560
4,405

35,476
90,12912,74635,991

86

139

702

1,135

Income taxes
ProfitProfit attributable to noncontrolling interests
Profit attributable to owners ofparent¥10,945

¥

¥

4,266

$

Yen
Per share:
Basic earnings
Diluted earnings
Cash dividends¥ 1,017.22
1,011.45
310.00-7-¥

89,427$

156,712
81,117735
238,581
139,766
3,930
53,166435,460$

34,855

U.S. dollars
396.82394.46120.00

$

8.31
8.26
2.53

$

3.24
3.22
0.98

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Statements of Comprehensive Income
For the Years Ended March 31, 2022 and 2021
Millions of yen
2022
2021
Profit¥Other comprehensive income:Unrealized (losses) gains on availablefor-sale securities
Deferred gains on hedges
Retirement benefit adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to:
Owners of parent
Non-controlling interests
Total comprehensive income

¥

4,405

$

(16,621)535(65)(16,151)¥ (5,119)¥

29,777100
3,815
33,692
38,098(135,803)
4,371
(531)
(131,963)$ (41,825)

243,296817
31,170275,283$ 311,283¥¥

37,937160
38,098$ (42,585)
751$ (41,825)$ 309,968
1,307$ 311,283¥

11,031Thousands of U.S. dollars
2022
2021

(5,212)
92(5,119)-8-¥

90,129$35,991

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Statements of Changes in Net Assets
For the Years Ended March 31, 2022 and 2021
Millions of yen
Accumulated other comprehensive income

Shareholders’ equity
Number ofshares ofcommon stock
issuedBalance at April 1, 2020
Profit attributable to owners of parent
Cash dividends
Reversal of land revaluation increment
Treasury stock acquired, net
Transfer to capital surplus from retained
earnings
Net changes in items other thanshareholders’ equity
Balance at March 31, 2021
Cumulative effects of changes inaccounting polices
Restated balance at March 31, 2021
Profit attributable to owners of parent
Cash dividends
Reversal of land revaluation increment
Treasury stock acquired, net
Transfer to capital surplus from retained
earnings
Net changes in items other thanshareholders’ equity

10,943,240-

Balance at March 31, 2022

10,943,240

Commonstock¥

18,000-Capitalsurplus¥Retainedearnings

13,883 ¥(3)

Total
shareholders’equityTreasurystock

138,933
4,266(1,075)(46)-¥(1,071)
16¥

169,746
4,266(1,075)(46)
13

Net unrealized
gains onavailable-for-salesecurities¥

29,589-Deferred
gains onhedges¥Land
revaluation
increment
-

¥

8,366
-

Retirement
benefitadjustment¥(2,823)-

Total
accumulated
othercomprehensive
income¥35,131-Stockacquisitionrights¥295-

Noncontrollinginterests
¥

4,177
-

Total
net assets¥

209,350
4,266(1,075)
(46)
13

-

-

3

(3)

-

-

-

-

-

-

-

-

-

-

10,943,240

18,00013,883142,074(1,055)

172,90329,75559,345

100
100

46
8,413

3,815
991

33,71868,850

7
302

158
4,335

33,883
246,391-

18,000-13,883(9)(38)
142,036
10,945(1,721)140-(1,055)75(38)
172,865
10,945(1,721)
140
66

59,345
-

100
-

8,413
-

991
-

68,850
-

302
-

(20)
4,315
-

(58)
246,333
10,945(1,721)
140
66

-

-

9

(9)

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

(16,627)

535

(140)

(65)

(16,297)(43)

90(16,250)¥

18,000¥13,883¥

151,391

¥

(979)

¥

182,295¥

42,718

¥

635

¥

8,272

¥

925

¥

52,552

¥

259

¥

4,405

¥

239,512

68,355-$(23,065)-$

287,041
-

$

2,410
-

$

34,128-$ 1,710,515
34,855(8,783)(375)
106

Thousands of U.S. dollars
Balance at April 1, 2020
Profit attributable to owners of parent
Cash dividends
Reversal of land revaluation increment
Treasury stock acquired, net
Transfer to capital surplus from retained
earnings
Net changes in items other thanshareholders’ equity
Balance at March 31, 2021
Cumulative effects of changes inaccounting polices
Restated balance at March 31, 2021
Profit attributable to owners of parent
Cash dividends
Reversal of land revaluation increment
Treasury stock acquired, net
Transfer to capital surplus from retained
earnings
Net changes in items other thanshareholders’ equity$ 147,070-

Balance at March 31, 2022

$ 147,070$

113,432 $(24)

1,135,166
34,855(8,783)(375)-$(8,750)130$

1,386,927
34,855(8,783)
(375)
106

$

241,759
-

$

-

$

-

24

(24)

-

-

-

-

-

-

-

-

-

-

147,070

113,432

1,160,830(8,619)1,412,721

243,116
484,884

817

375
68,73931,1708,097

275,496562,545

57
2,467

1,290
35,419276,8442,013,162

147,070-

113,432(73)(310)
1,160,519
89,427(14,061)
1,143-(8,619)612(310)
1,412,411
89,427(14,061)
1,143
539

484,884-817-

68,739-8,097-

562,545
-

2,467
-

(163)
35,256-(473)
2,012,688
89,427(14,061)
1,143
539

-

73

(73)

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

(135,852)

4,371(1,143)(531)(133,156)

(351)

735

(132,772)

35,991$ 1,956,957$

113,432$

1,236,955$(7,999)$1,489,459-9-$349,031

$

5,188

$

67,587

$

7,557

$

429,381

$

2,116

$

The Aichi Bank, Ltd. and Subsidiaries
Consolidated Statements of Cash Flows
For the Years Ended March 31, 2022 and 2021
Millions of yen
2021
2022
Cash flows from operating activities:
Profit before income taxes¥
Adjustments for:
Depreciation
Impairment loss on fixed assets
Increase in allowance for possible loan losses
Interest and dividend income
Interest expense(Increase) decrease in trading securities
Increase in loans and bills discounted
Increase in call loans and bills purchased
Increase (decrease) in call money and bills soldIncrease in deposits(Decrease) increase in security deposits received
related to securities lending transactions
Increase in borrowings(excluding subordinated borrowings)
Gain on securities transactions
Gain on foreign currency transactions
Increase in reserve for contingencies
Interest and dividend income received
Interest expense paid
Other, net
Subtotal
Income taxes paid
Net cash provided by operating activities

15,374¥

5,966

Thousands of U.S. dollars
2022
2021
$

125,614$

48,745

1,738
186
351
(32,288)356(49)(230,762)(6,553)
131,119
168,023

1,589
50
4,983
(29,200)351
1(464,940)(2,537)(5,441)
412,866

14,2001,519
2,867(263,812)
2,908
(400)
(1,885,464)(53,541)
1,071,321
1,372,849

12,983408
40,714(238,581)
2,867
8(3,798,839)(20,728)(44,456)
3,373,363(42,077)

11,209(343,794)

91,584

288,762(4,226)(5,176)115
32,690(368)
1,500
318,713(4,126)
314,587

71,256(3,804)(950)
134
29,919(436)
5,325
36,341(1,618)34,7232,359,359(34,528)(42,291)939
267,096(3,006)
12,2552,604,077(33,711)2,570,365

582,204(31,080)(7,762)
1,094
244,456(3,562)43,508296,927(13,220)
283,707(218,477)
164,407
(832)
465
(147)
(41)

(263,673)
321,489(1,810)74(328)-(1,785,088)
1,343,304(6,797)
3,799(1,201)(334)(2,154,367)
2,626,758(14,788)604(2,679)-(54,626)

55,752(446,327)

455,527

Cash flows from financing activities:
Dividends paid
Other, net
Net cash used in financing activities(1,721)(25)(1,746)(1,075)(25)(1,100)(14,061)(204)(14,265)(8,783)(204)(8,987)

Net increase in cash and cash equivalents

258,21489,3752,109,763

730,247

Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year

224,225
482,440

134,849
224,225

1,832,053$ 3,941,825

1,101,797$ 1,832,053

Cash flows from investing activities:
Purchases of securities
Proceeds from sales and maturities of securities
Purchases of tangible fixed assets
Proceeds from sales of tangible fixed assets
Purchases of intangible fixed assets
Payment for asset retirement obligations
Net cash (used in) provided by investing
activities¥- 10 -¥

Basis of Presenting Consolidated Financial Statements
The consolidated financial statements of The Aichi Bank, Ltd. (the “Bank”) and its subsidiaries(collectively the “Group”) have been prepared in accordance with the provisions set forth in the Japanese
Financial Instruments and Exchange Act of Japan and its related accounting regulations and in conformity
with accounting principles generally accepted in Japan (“Japanese GAAP”), which are different in certain
respects as to the application and disclosure requirements from International Financial ReportingStandards. The accompanying consolidated financial statements have been reformatted and translated
into English with some expanded descriptions from the consolidated financial statements of the Bank
prepared in accordance with Japanese GAAP and filed with the appropriate Local Finance Bureau of the
Ministry of Finance as required by the Financial Instruments and Exchange Act. Certain supplementary
information included in the statutory Japanese language consolidated financial statements is not presented
in the accompanying consolidated financial statements.
The translation of the Japanese yen amounts into U.S. dollar amounts is included solely for theconvenience of readers outside Japan, using the prevailing exchange rate at March 31, 2022, which was¥122.39 to U.S. $1.00. This translation should not be construed as a representation that the Japanese
yen amounts have been, could have been or could in the future be converted into U.S. dollars at this or
any other rate of exchange.
The Japanese yen amounts in the accompanying consolidated financial statements are expressed inmillions of Japanese yen and have been rounded down. U.S. dollar amounts in the accompanying
consolidated financial statements are expressed in thousands of U.S. dollars and also have been rounded
down. As a result, total amounts expressed in both Japanese yen and U.S. dollars appearing in the
consolidated financial statements thereto may not be equal to the sum of the individual amounts.
Certain comparative figures have been reclassified to conform to the current year’s presentation.

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