JUROKU BANK

Financial Review[for the fiscal year ending in March 2021]

June 3, 2021
Listed in the First Section of the Tokyo Stock Exchange and Nagoya Stock Exchange (8356)

Table of Contents
Section 1: Financial Results for the fiscal term
ending in March 2021
Overview of results for FY2021/3

Section III: Our main initiatives
4-8

Projection for FY2022/3

9

Dividend status

10

Progress of the 15th Medium-Term Management Plan

11

Organizational restructuring

23

Commitment to local communities

24

COVID-19 response

25

Implementing engagement
Digital transformation strategy
ＳＤＧｓ・ＥＳＧ

26-27
28
29-31

Section II: Transition into the holding
company system
Background and purpose of transition into the holding

13

company system
Business performance of Juroku TT Securities

14

Establishment of NOBUNAGA Capital Village

15

Trade name and logo of the holding company

16Group management philosophy

17Group structure

18

Management structure of the holding company

19(governance structure)
Management plan of the holding company (overview)

20

Numerical targets of the holding company

21

Any reference to future performance, e.g. business projection, in this material is based on some premises
we considered to be consistent and rational based on currently available information. Actual results could
significantly vary due to a variety of factors.

2Section I: Financial Results for the fiscal
term ending in March 2021

3

Overview of results for FY2021/3（単位:億円）(Unit: 100 millionyen)

Non-consolidated
単体

2019/32020/32021/3

A

B

Year-on前期比
Year
B－A

Increase in non-consolidated andconsolidated profit

Core gross operating profit
コア業務粗利益

590

626

622

△4

Net interest income
資金利益

498

519

508

△ 11

Fees and commissions
役務取引等利益

96

106

98

△8

△4

1

15

14

443

421

407

△ 14

Personnel expenses
うち人件費

242

223

209

△ 14

うち物件費
Non-personnel expenses

174

170

170

0

Core net operating profit
コア業務純益

147

205

215

10

Net business income
実質業務純益

146

214

215

1

Profit related to securities investment
有価証券関係損益

20

9

45

36

△0

8

0

△8

21

1

45

44

与信関係費用Credit costs

21

35

41

6

Ordinary profit
経常利益

146

185

225

40

Net income
当期純利益

99

127

141

14

Other operating profit (Excluding profit on JBGs and other debt
その他業務利益（除く国債等債券損益）
securities

Expenses
経費

Profits on JGB and other debt securities
国債等債券損益

Profits on equities
株式等関係損益（単位:億円）(Unit: 100 million
yen)Consolidated
連結2019/32020/32021/3

Ａ

Ｂ

Year-on前期比
Year
Ｂ－Ａ

Non-consolidated: 4 consecutive years
Consolidated: 3 consecutive years

Overview of nonconsolidated results○Core gross operating profit△400 million yen (YoY)
・Net interest income has declined by
1.1 billion yen due primarily to adrop in securities interest anddividends.
・Fees and commissions have dropped
by 800 million yen due to soft
lockdown following the spread of
COVID-19 at the start of the fiscal
year.

○Expenses△1.4 billion yen (YoY)
・Personal expenses have declined thanks
to the spread of HQ-concentration andteam system, enabling branchadministration with a smaller number ofstaff.

○Core net operating profit＋1 billion yen (YoY)○ Profit（YoY）
Ordinary profit ＋4 billion yen
Net income＋1.4 billion yen

Core gross operating profit
コア業務粗利益

656

705

712

7

Expenses
経費

494

484

474

△ 10

Core net operating profit
コア業務純益

162

220

238

18

Ordinary profit
経常利益

162

194

246

52

Net income attributable to owners of the parent company
親会社株主に帰属する当期純利益

106

128

147

19

Overview of consolidated results○Profit（YoY）
Ordinary profit＋5.2 billion yen
Net income attributable to ownersof the parent company ＋1.9
billion yen

4Overview of Results for FY2021/3（単位:億円）(Unit: 100
million yen)【Half-yearly transition of results】
Non-consolidated
単体

2020/3H1
上期

H2
Significant increase
in income and profit

2021/3
下期
H2

H1
上期

H2
下期

H2ーH1
下期－上期

Ａ

B

Ｂ－Ａ

Core gross operating profit
コア業務粗利益

321

305

304

318

14

Net interest income
資金利益
Fees and commissions
役務取引等利益

267

251

255

252

△3

53

53

45

53

8

0

0

4

11

7

214

206

207

199

△8

うち人件費
Personnel expenses

114

109

105

103

△2

うち物件費
Non-personnel expenses

85

84

85

84

△1

Core net operating profit
コア業務純益

106

99

97

118

21

実質業務純益Net business income

105

109

111

104

△7

有価証券関係損益
Profit related to securities investment

△1

10

39

6

△ 33

△1

10

14

△ 13

△ 27

0

0

25

20

△5

Credit costs
与信関係費用

17

18

27

14

△ 13

Ordinary profit
経常利益

91

93

112

112

0

Net income
当期純利益

65

62

75

65

△ 10

Other operating profit (Excluding profit on JBGs and other debt

その他業務利益（除く国債等債券損益）
securities

Expenses
経費

Profits on JGB and other debt securities
国債等債券損益

Profits on equities
株式等関係損益○Core gross operating profit（+1.4 billion yen from H1）
・ Fees and commissions
rose 800 million yen
after recovering fromthe dip in H1 caused bysoft lockdown following
the spread of COVID-19.
○ Core net operating profit（＋2.1 billion yen from H1）
・The core net operating
profit surged due to theincrease in core grossoperating profit and theon-going effect of cost
reduction.

（Unit: 100 million yen）
2020/3

Consolidated
Consolidated

H1

2021/3
H2

H1

H2

H2ーH1

Ａ

Ｂ

Ｂ－Ａ

Profit increase also
in the consolidatedbasisCore gross operating profit

356

348

345

367

22

Expenses

243

240

240

233

△7

Core net operating profit

113

107

104

134

30

Ordinary profit

96

98

118

127

9

Net
incomeattributableto owners of thecompany
Interimnet
income attributable
toparent
ownersof the parent

65

63

75

71

△4

○ Core gross operating profit（+2.2 billion yen from H1）○Core net operating profit（＋3 billion yen from H1）

5

Overview of Results for FY2021/3
Core net operating profit / Net business income（100 million yen)Core net
operating profit
コア業務純益250

Breakdown of net interest income（100 million yen)

Net business income
実質業務純益JPY loans and円貨預貸金利息収支
deposits

550
200

JPY securities
円貨有価証券利息配当金
investment

519

508

498

500

Foreign currencies
外貨資金利益

43

42

40

150

450

205 214100

215 215

96

82

377

376

379

19/3

20/3

21/3

76

400

147 146
50

350

0

300
19/3

20/3

21/3

Average balance and yield of JPY loans

Factors of fluctuation in core net operating profit（100 million yen)
V: Balance factor

230

Loan interest
△4

V:＋9
R:△１4

210

Depositinterest+2（100 million yen)

R: Yield factor
Securities
interest△10

Fees and
Personnel
commissions
expenses△8+14

OthersNon-personnel ＋13
expenses+0

Tax △1Other operating
profits＋14

Average
円貨貸出金平残balance

48,000

0.912

V:△０
R:+３

Average yield
円貨貸出金平均利回り

1.400

0.889

0.867

46,00044,111

205

1.000
0.600
0.400

42,92342,266

215

1.200
0.800

44,000
190

（%)

0.200
0.000

42,000-0.200170-0.40040,000-0.600-0.800150

38,00020/3

21/3-1.000

19/3

20/3

21/3

6

Overview of Results for FY2021/3
Fees and commissions（100 million yen)

Individuals–

預り資産関連related

150
140
130
120
110
100
90
80
70
60
50
40
30
20

Corporate-related
法人ソリューション関連

M&A手数料
M&A
fees
ビジネスマッチング手数料
Business
matching fees

2,000

98

1,960
1,749
367

1,418

1,500

439

272

140

446

35

1,000

252

330
364

17

52

Privateplacement bond fees
私募債手数料29

38

14

Syndicated loans and commitment fees
シ・ローン手数料+コミットメントフィー等

2,500

106

30

（Million yen)

Othersその他

1296

Corporate solution-related revenues＜Revenues related to assets
handled by Juroku IT
Securities>

19

50

500

252

44

1,068

839

355

0
19/3

20/3

21/3

19/3

JPY securities
円貨有価証券平残

16,000Foreign currency
外貨有価証券平残

securities
Foreign currency
外貨有価証券利回り
securities average yield

JPY securities average
円貨有価証券利回り
yield

2.572

（%)

3.000
2.500

2.045

12,000

21/3

Valuation gains and losses of securities

Average balance and yield of securities investment（100 million yen)

20/3

国内債

JPY bonds（100 million yen)

900

700

Stocks
株式その他

Other securities

837

757
9

565

2.000
1.554
8,000

11,402

9,979

4,000

0

1.000

10,513
0.968
0.729
2,282
19/3

500
1.500

2,750

0.721

0.500

2,502

869

689
300

100

552
59

17

△3

△3

△ 27

20/3

21/3

0.000
20/3

21/3

△ 100
19/3

7

Overview of Results for 2021/3
Profit from customer services（100 million yen)

Capital adequacy ratio

Profit from customer services＝Average loan balance × Difference in interest rates fordepositors and borrowers + Net income from fees and commissions – Operating costs

Capital adequacy ratio

自己資本比率(単体)(non-consolidated)(%)

Capital adequacy ratio

自己資本比率(連結)(consolidated)

11.00
80

9.93
10.00

9.27

60

9.08

40

20

72

82

9.00

9.35
8.71

36

8.00

0

8.49

7.00
19/3

20/3

21/3

19/3

Core OHR

21/3

ROE（consolidated）
Core OHR (non-consolidated)
修正OHR(単体)

(%)

20/3

Core OHR (consolidated)
修正OHR(連結)

80.00

（%）
4.00

Net
income attributable to owners of the parent company
親会社株主に帰属する当期純利益

3.98

ROE
(consolidated)
ROE（連結）

160

3.65

75.19

150

75.00

3.50

75.04

140

3.05

68.69

70.00

66.51
67.18

65.00

130

3.00

147

100

106
2.00

60.00
20/3

21/3

120
110

128

2.50

65.38
19/3

（100 million
yen）

90
19/3

20/3

21/3

8

Projection for FY2022/3
a(Unit: 100 million
yen)（単位:億円）
2021/32022/3(Actual)（実績）(Projection)（予想）

コア業務粗利益Core gross operating profit

622

626

4

資金利益
Net interest income

508

514

6

(100

役務取引等利益
Fees and commissions

98

100

2

240

Other operating profit (Excluding profit on JBGs andその他業務利益(除く国債等債券損益)
other debt securities

15

12

△3

407

403

△4

Personnel expenses
うち人件費

209

204

△5

Non-personnel expenses
うち物件費

170

170

0

215

223

8

Credit costs
与信関係費用41

59

18

Profit related to securities investment
有価証券関係損益

45

18

△ 27

0

0

0

45

18

△ 27

Ordinary profit
経常利益

225

204

△ 21

Net income
当期純利益

141

135

△6

Non-consolidated
単体

Expenses
経費

Core net operating profit
コア業務純益Profits on JGB and other debt securities
国債等債券損益
Profits on equities
株式等関係損益

Year-on-

前期比Year
Factors of fluctuation in core net operating profit
Loaninterest△2

Depositinterest
+1

V:+11
R:△13

V:△0
R:＋1

Securities
interest+6

Fees and Personnel
expensescommission+5s+2

Non-personnel
expenses△0

Others
△4

220

200

223

215
V: Balance factor

R: Yield factor

180
21/3

22/3

(Unit: 100 million
yen)（単位:億円）
2021/32022/3(Actual)（実績）(Projection)（予想）Ordinary profit
経常利益

246

219

△ 27

Net income attributable to owners of the parent company
親会社株主に帰属する当期純利益

147

140

△7

Consolidated
連結aYear-on前期比Year

9Dividend status
Dividend status (Annual dividend per share)（Transition over the last decade）
Commemorative

Ordinary dividend
普通配当金

記念配当金
dividend

Special dividend
特別配当金

(yen)

（円）

Annualdividend

100

Interimdividend

Term-end
dividend

Management
amalgamation
completed90
Increase

Mid-termmanagement goal
achieved

140th anniversary ofbank foundation

Commemorative
dividend80

Ordinary dividend

7060

2019/370 yen35 yen35 yen

－

50
40
30

2020/380 yen35 yen45 yen＋Special dividend 10 yen＋Ordinary dividend 10 yen＋Commemorative dividend
10 yen20
102021/3（Scheduled）

2022/3（Planned）

90 yen35 yen55 yen80 yen40 yen40 yen

0
12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

(Scheduled)（Annual dividend after reverse stock split (10.2017) for comparison） (予定)Transition of total dividends paid
(Million yen)

配当金総額

連結当期純利益
Consolidated net income

Total dividends paid

（100 million yen）

3,200

○ Shareholder return policy
The basic policy is to further improve the bank’s
fiscal health to ensure stable and continuous payoutof dividends. The details of dividends to be paid out
shall be determined in view of management
conditions and the level of profits in general.

200

147.2

3,000

128.6
2,800

100.3

99.0

150

106.5
3,363

2,600

2,989

100

2,989

2,400

2,616

2,615

50

2,200
2,000

0
2017/3

2018/3

2019/32020/32021/3（Scheduled）

10

Progress of the 15 th Medium-Term Management Plan■

Numerical targets

Targets for
FY2022

Figures at thestart of the plan
（FY2019 actual）

Actual figures for
FY2020

Profitability

Net income(consolidated)

12 billion yen

12.8 billion yen

14.7 billion yen

Efficiency

Core OHR(non-consolidated)

67% range

67.18%

65.38%■

Long-term goals

Targets for
FY2022

Figures at thestart of the plan
（FY2019 actual）

Actual figures for
FY2020

Profitability

ＲＯＥ （consolidated）

5% and above

3.65%

3.98%

FiscalhealthCapital adequacy ratio（consolidated）

10% and above

9.27%

9.93%

11

Section II: Transition into the holding
company system

12Background and purpose of transition into the holding company system

As a financial institution with its operation base in Gifu and Aichi Prefectures, Juroku Bank has strived to contribute to the revitalization of thelocal economy by maintaining dialog with local residents to create shared values with the goal of establishing a general financial group thatmakes sustainable growth with local communities.
The business environment surrounding regional financial institutions have changed dramatically amidst the government’s protracted lowinterest policy and intensified competition transcending business types and formats. In order to contribute to building a sustainable society,regional financial institutions must change their business model to cater to deregulation.
To this end, the Juroku Bank Group has decided to shift to the holding company system with the aims of expanding its scope of business byentering into new fields, transforming the mentality and behaviors of directors and employees to reinforce group-wide collaboration andPurposes to shift into the holding company system
Expanding the scope of business
Optimizing the distribution of the Group’s management
resources
Reinforcing the auditing / supervisory functions and improving
the pace of work execution

optimize the distribution of management resources, strengthening the auditing / supervisory function and improving the pace of work execution.
Under the holding company system, the Group will establish a management structure that can flexibly adapt to any changes in businessconditions to boost our corporate value, in a mission to amass our management resources to assist clients’ business and bring a sustainable

Changes inmarket scale

Socialchanges

Transformation inbusiness model

growth to the local economy.

Flexibly adapting to changes inbusiness conditions

Juroku Group’s history

Connecting people, local communities and future

Shift to the holding company system

NOBUNAGA Capital Village
established

Juroku TT Securities
commenced business operation

Juroku Research Institute established

Juroku Diamond Credit established(today’s Juroku Card)

Juroku Lease established

Amalgamation with Gifu Bank

Juroku Financial Group

Creating shared values
Solving customers’ / local
communities’ issues

Improving corporate
value

Bringing sustainable growth
to local economy
13

Business performance of Juroku TT Securities
Actual value of assets in custody held by the Group (excluding personal deposits)(Million yen)（億円）
12,000

Juroku Bank
十六銀行

20,00020,000十六ＴＴ証券
Juroku TT Securities

17,000十六ＴＴ証券口座数（概数）
Juroku TT Securities/ Number of accounts

11,000(approximate)

10,000
9,000

8,000

11,00015,000
2,000

9,454

8,964

8,972

1,019

1,028

8,727
937

10,035

10,000

1,700
1,344

9,000
7,945

7,944

8,110

19/6
19/9
（At the time of establishment）

20/3

20/9

7,789

Performance far exceeding
the initial and annual plans

11,00014,50013,00010,000

Numberof（口座数）
accounts

5,000

8,335

7,000

Assets in custody（Juroku TT Securities）＋76.3 billion yen since
establishment（＋81%）increase
Number of accounts opened＋7,000 accounts since
establishment（+70%）increase0

Becoming profitable in fullyear financial results in thesecond year of
establishment

21/3

Major contribution to
consolidated results

目標
TargetEliminating accumulated
loss one year ahead ofschedule

Further strengthening collaboration with the Bank to reach 200 billion yen in assets in custody at an early stage
14

Establishment of NOBUNAGA Capital Village
On April 1, 2021, NOBUNAGA Capital Village Co., Ltd. was established as Juroku Bank’s wholly-owned subsidiary specializing
in investments.
It supports next-generation leaders and companies through managing funds worth about 4.5 billion yen in total, including
corporate venture capitals investing in startups in synergy with “local economy” and “finances” as well as local venture
capitals that invest in “future leaders of local economy.”

Juroku Bank Group

Local
economyFinancial support
Offering financial support in
the forms of loans andfunding

Economic revitalization
Sustainable growth

HR support
Sending Bank staff andemployees as temp worker
or worker on loan (second
career)Management support
Offering management
consultation, i.e.
management advice andsolutions (hands-on)

Network support
Offering the use of Juroku
Bank Group’s network

Creation of work andjobs
Investmentcompany
Co-creation with local
businesses and the Juroku
Bank Group

Juroku Bank
Group
Transformation of thebusiness model
Employeeempowerment support

Creating new business in local communities to contribute to the establishment of a sustainable society
15

Trade name and logo of the holding company【Trade name of the holding company】

Juroku Financial Group, Inc.
【Logo of the holding company】

Concept of the logo
The logo combines three rings, symbolizing new circle (harmony) generated from the
combination of human connection, community connection and Group connection.
The “crosses” where the rings intersect and the six peaks the three rings form

symbolize our desire to bring the three elements together to form a strong bond that
resonates in building a future together for sustainable growth.
The red color represents “history” and “tradition” the Group has accumulated, while
the orange color represents the ”spirit of challenge” and “vibrance” to make a leap
into the future.

【Group policy】

Connecting people, local communities and the future
Valuing connection and bond with our customers and local communities…
The Juroku Financial Group will connect people, local communities and future.
16

Group management philosophy
The Group Management Philosophy, based on Juroku Bank’s basic philosophy, outlines the fundamental management spirit of the Juroku
Financial Group as the basis of activities for all of our directors and employees. It consists of “our mission,” “our vision” and “our value.”
The “code of conduct” is also defined, setting out specific conducts expected of our director and employees to put the philosophy into
practice.

Group management philosophy
Code ofconduct

Bringing growthand enrichment toour customers
and local
communities
In order to contribute to building asustainable society…

We strive to become a general
financial group that works withlocal communities to co-create
local future and co-achievesustainable growth.

Trust & Integrity

Creation & Innovation

We act with a high level ofintegrity to win the trust of ourcustomers and local
communities and continue to bea financial group of their choice.

We constantly take on
innovation and challenges toadapt to any changes,
thereby creating new values
ahead of the times.

Diversity & Inclusion
We recognize one
another’s individuality
and embrace diverse
abilities to maximize thegroup’s capacity.

Engagement Cycle
A set of conducts aimed at facing the issues of our customers and local communities and working
with them to bring solutions

Juroku Financial Group, connecting people, local communities and future

17Group structure
Stage 1

Juroku Bank shall establish a holding company through a sole transfer of shares and become a wholly-owned subsidiary of theholding company, effective on October 1, 2021.

Stage 2

From the perspective of strengthening collaboration within the group, Juroku Bank’s six consolidated subsidiaries, namely
Juroku Research Institute, Juroku TT Securities, Juroku Card, Juroku Lease, Juroku Computer Service and NOBUNAGA Capital
Village, are due to be restructured into the holding’s company’s direct-investment companies.

Before theestablishment of theholding company (now)Stage 1

Stage 2

Sole transfer of shares (uponestablishment of the holding
company)

Transfer of shares held by the bank(after the establishment of theholding company)

Juroku Financial Group

Juroku Financial Group
Juroku Bank

Juroku Bank

Juroku Bank

Juroku Business Service

Juroku Business Service

Juroku Research InstituteJuroku Research InstituteJuroku Credit Guarantee

Juroku TT Securities

Juroku TT Securities

Juroku Card

Juroku Card

Juroku Lease

Juroku Lease

Juroku Computer Service

Juroku Computer Service

Juroku Credit Guarantee

Juroku Credit Guarantee

NOBUNAGA Capital Village

NOBUNAGA Capital Village

Reinforcing collaboration
within the group

Juroku Business Service

Juroku Research InstituteJuroku TT Securities
Juroku Card
Juroku Lease
Juroku Computer Service
NOBUNAGA Capital Village

18

Management structure of the holding company (governance structure) The holding company is to be established as a ”Company with Audit and Supervisory Committee,” with its Board of Directors exercising adecision-making function as well as a reinforced auditing / supervisory function. Group companies’ work execution, risk management andcompliance stance will be monitored to build a group-wide management structure, thereby further advancing our corporate governance.
 Each of the Group companies will draw up its business plan in line with the group-wide management policy, defined by the holding company,
and increase the pace of management decision-making and work execution to streamline business administration.

Corporate governance structure under the holding company system
Annual General Meeting of Shareholders
Juroku Financial GroupManagement Advisory
CouncilConsultation

HR Advisory Committee

AdviceRemunerations Advisory
Committee

Coordination

Board of Directors

Board of Auditors

Office ofthe Boardof Auditors

Group Management
CouncilGroup Risk
Control
DivisionGroup Business
Planning
DivisionGroup companies

Instructions andmanagement

Juroku Bank
Instructions andmanagement

Report andconsultation

Juroku Bank subsidiaries
Juroku Business Service andJuroku Credit GuaranteeGroup Sales
Control
Division

Supervision

Report andconsultation

Audit

Accounting Auditor

Command
Instructions
ReportGroup Risk Compliance Council

Group
Business
Management
Division

Appointment /dismissal

Appointment / dismissal

Coordination

Coordination

Group
Management
Review Office

Audit

Other subsidiaries
Juroku Research Institute, Juroku TT Securities, Juroku
Card, Juroku Lease, Juroku Computer Service,
NOBUNAGA Capital Village

Audit

19

Management plan of the holding company (overview)
The Juroku Financial Group plans to draw up its first management plan that covers a period from October 2021 to March 2023.
We will adopt a set of three group-based strategies, driven by the need to “expand the business scope” and “address diversified needs,” to maximize groupsynergy and build a “general financial group that works with local communities to create new future and achieve sustainable growth together.”

Overview of the group-based strategies
Further exerting
solution-building
ability

Improving comfort
and productivity
Approaching customers
in a way that uses digitaltechnology and data
Accelerating
digitalconversion ofwork duties tocreate time foractivities andimprove theirvalueMarket-in
approachstrategy

Amassing the group’s
management
resources for the
consultation function
Offering diverse
solutions for various
issuesBased on the “market-in” concept, we amass thegroup’s management resources for the consultation
function while offering diverse solutions for various
issues to create shared values with customers andlocal communities.

DX strategy
Improving comfort and productivity

Expanding thebusiness scope
Addressing
diversified needsDX
strategyMarket-in approach strategy
Further exerting solution-building ability

We approach customers in a way that uses digitaltechnology and data, while accelerating digitalconversion of work duties to create time for activities
and improve their value.

Local
commitment
strategy

Offering comprehensive design for
local communities
Expanding the business scope to play a central role in community
revitalization
Making group-wide efforts to implement initiatives for achieving
SDGs and revitalizing local communities

Local commitment strategy
Offering comprehensive design for local
communities
We make group-wide efforts to implement initiatives
for achieving SDGs and revitalizing local
communities, while expanding the business scope toplay a central role in community revitalization for
Gifu and Aichi Prefectures, where our operating
foundation lies.

20

Numerical targets of the holding company
We will make the most of group synergy that arise from our transition into the holding company system to achieve the following numerical targets in
FY2022. Efforts will be made to improve our fiscal health and efficiency, while expanding our business scope beyond the current banking / lending
services to boost profitability.

■

(%)
10.5

Numerical targets in the holding company’s first management plan
Consolidated capital
adequacy ratio

Consolidated core OHR

(%)
70.0

68.69%

10.0
9.93%

and
10.00% above

65.0

(%)
31.0

Consolidated non-interest
profit ratio

29.0

30.0%
29.1%

66.51%
and65.00% below

9.5

27.0
26.5%

9.27%
25.0

60.0

9.0
FY2019result2019年度実績

and above

FY2020result 2022年度
FY2022 target
2020年度実績

FY2019result2019年度実績

目標

Consolidated net income
FY2022 target: 12.3 billion yen

Numerical targets are conservatively set in view of the
COVID-19 pandemic.

■

FY2020 result 2022年度
FY2022 target
2020年度

実績

目標

Long-term index
Consolidated ROE

FY2019result2019年度実績

FY2020result2020年度実績

FY2022target2022年度目標※ The consolidated non-interest profit ratio
refers to the ratio of “fees and commissions”
and “other operating profit excluding profit on
JGBs and other debt securities” in the
consolidated core gross operating profit.

5.0％ and above

21

Section III: Our main initiatives

22

Organizational restructuring
We underwent organizational restructuring in April 2021 to put the market-in approach into
practice and to reinforce the initiatives toward “digital transformation,” “community revitalization”
and “SDGs” more than ever before.
Business Planning &Management departments

Engagement departments

Secretarial OfficeBusiness Management Department

Management Planning Department

Digital Reform Department

Risk Control Department

Aichi Sales HQ

Retail Sales Department

Solution Sales Department

Community Revitalization Department

Market Administration Department

Corporate Support Department

Administration Department

Sales Support HQ

１. Putting the market-in approach into
practice
The “Personal Accounts Sales Department” has become
the “Retail Sales Department,” consisting of the “Retail
Planning Group,” “Retail Sales Group” and “Personal
Loan Group.”
The “Corporate Accounts Sales Department” hasbecome the ”Solutions Sales Department,” consisting of
the “Finance Group” and “Solutions Group.”
The ”Corporate Consulting Group” has been establishedin the “Corporate Support Department.”

２. Reinforcing the initiative for “digitaltransformation”
Tokyo Office
Nagoya Office

HR Development Group

Human Resource Group

Administration Group

Planning Group
Financial Group
PR & IR Office

DX Promotion GroupWork Reform Group
Channel Development Group

Risk Control Group
Compliance Office
Money Laundering Prevention Office

Sales Management Group
Direct Marketing Center
Customer Service Office

Aichi Sales Group

Retail Planning Group
Retail Sales Group
Personal Loan Group

Finance Group
Solution GroupManagement Succession Support Office

Overseas Support Office (including overseas
expatriates offices)

SDGs Promotion OfficeCommunity Revitalization Group

Market Finance Group
Foreign Exchange Group
Investment Management Group

Loan Group
Corporate Consulting Group

Loan Management Group

Administration Planning Group
Sales Office Support Group
System Administration Group
System Development GroupThe “Operation Reform Department” has been changed to the“Digital Reform Department,” in which the “DX Promotion
Group” has also been set up.

３. Reinforcing the initiative for “community
revitalization”
The “Public Sector Sales Department” has been changed to the“Community Revitalization Department,” in which the “Community
Revitalization Group” has also been set up.

４. Reinforcing the initiative for “SDGs”
The “SDGs Promotion Office” has been set up in the“Community Revitalization Department.”

23

Commitment to local communities
The Community Revitalization Department was set up in April 2021. It collaborates with various
local stakeholders to offer comprehensive local design and promote initiatives for solving local
issues driven by SDGs.
Active actions to solve local issues

Measures for solving the issues

Initiative toward
promotingcommunity
revitalization〇

Reinforcing regional collaboration to actively
become involved in community revitalization
projects〇

Promoting community revitalization driven
by SDGｓ

Establishing the SDGs
Promotion Office

SDGs promotion

Main issues held by local communities
Population decline/ aging
Stagnation of
inbound tourism
demandChanges in theindustrial structure

Successor
shortages

Digitaltransformation
Women’s
empowerment

Reinforcing relations
with local governments
and associatedorganizations〇

Streamlining administration associated withlocal governments〇

Addressing the need for cashlesstransactions〇

Enhancing commissions and eliminatingexcessive services〇

Activating the female-only project team
(Jewelia) to offer new value

Revitalization of central
business districts

Use of local
resources
Creation of local
brandsSupporting
community
revitalization〇 Developing appealing communities with local
assets〇Establishing local industries as a brandContraction of
local economy

Working closely with local businesses, residents and government bodies to contribute to the growth andadvancement of a sustainable local economy
24

COVID-19 response
Offering swift support, mainly financing, to customers affected by COVID-19

Status of financing support

Swift initiative with emphasis on quick
implementation

COVID-19-related loans extended

11,491

Value of COVID-19-related loans

300.6 billion
yen（Zero-interest loans out of the above）

181.7 billion
yenHome loans whose terms have been changed due
to COVID-19
Value of home loans whose terms have beenchanged due to COVID-19

316 cases
4.4 billion yen

With regard to interest-free unsecured loans introduced in May
2020, we have adopted a mechanism for handling batch
applications to municipal authorities to establish a one-stop-shop
structure including attaining permit.

Support catered to individual customers
We set up a corporate consulting group in April 2021.
Review staff collaborate with sales departments and offices
to visit clients, building close communication with theirsenior managers.
Through building consensus with clients, we offer partnerstyle support with an emphasis on speed as well as support
that combines assistance for their main line of business tocater to individual customers.

（As of March 31, 2021）

Support through loan products and capital funds
Cashflow Finance

A product that uses business feasibility assessment to examine future cashflow, which serves as the repayment source, and offers financial assistance toclients to be spent of their management strategy or business improvement.
175 loans worth 31.5 billion yen were extended in FY2020.

Relative commitment line

A product that addresses the need for diversifying fundraising limit andmeans. 21 loans worth 24.2 billion yen were extended in FY2020 (latest
product).

Capital loan Juroku-Tomoni-Mirai Fund

Since May 2020, we have offered subordinated loans and capital funding withclass shares via capital loans and Juroku Tomoni Mirai Fund to strengthen
customer companies’ capital position to boost their fiscal foundation and toassist in swift fundraising.

25

Implementing engagement
Offering a variety 地域やお客さまとの絆や関係を深め
of support including funding in empathy with customers
た顕著な事例の表彰制度を新設。

Organizing “business negotiation workshops”

Coordinating workforce handover between
clients

We hold “business negotiation workshops,” in which a branchmanager acts as a client’s “sales manager” to conduct a
presentation about goods and services to other branchmanagers within the block.
Compiling presentation materials
provides opportunities to learn more
about clients. In workshops,
participants present clients that meetthe needs for a quick contract incollaboration. This program has created
new business-matching opportunities
and engagements.
Customers

Sales support for clients
Amidst a decline in retail sales,
we organized a special sales
event to contribute to clients’sales and help them research
top-selling items and popular
price ranges through research.
At the event, over 120 people
made a purchase, giving muchneeded encouragement to theclients.

Directors
and staff

We identified HR needs of a client that had stable sales orders,and considered bridging the client with other clients who
suffered from excess staffing due to COVID-induced production
decline.
Our referral service resulted in the arrangement of about 20
workers. The engagement also allowed both parties to accessgovernment grants.

JurokuBank

Localcommunities

Shareholders andinvestors

Supporting client’s sales

A client began producing pesticide-freebananas in a project for promoting
disabled employment and assist their
independent living. When the client
planned to market banana liquor madeof the produced bananas, we suggested
crowd-funding based on businessmatching. The project, related to SDGs
promotion, led to sales that exceeded
expectations.

26

Implementing engagement
Sponsoring the Citrus Ribbon project
We sponsor the Citrus Ribbon
project, aimed at eliminating COVIDrelated discrimination and prejudicein communities, households andworkplaces, in order to build aconsiderate society.

We offered support to two clients operating taxi service, etc. in
the popular tourism destination, Hida Takayama, to help themovercome COVID-related difficulties including visitor decline.
These two clients’ business needs matched, resulting inbusiness partnership.
Taxi is an essential infrastructure not only for tourists but also
for local residents, making it a significant initiative for the
future of this community.

Customers“Engagement Allowance” to all
employees
We provided all employees who
work at the forefront of COVID19 pandemic with a special“Juroku Bank GroupEngagement Allowance”
totaling 360 million yen.
(100,000 yen for bank
employees and 50,000 yen forpart-time workers, etc.)

Maintaining local businesses throughclient assistanceDirectors
and staff

Hand-written message from the
President

Local
communities

JurokuBank Shareholders andinvestors

Conducting PR activities

The opening of the Gifu Sekigahara
Battlefield Memorial Museum, delayed
due to the COVID-19–pandemic, hasbeen scheduled for the anniversary dateof the Battle of Sekigahara (October 21).
In order to boost the economy of Seino,
three branches displayed a banner and alarge poster, while the local Sekigahara
branch put on a traditional suit of armor
in conducting business to publicize theopening.

About 790 cases of good practice initiatives (engagement news) were shared within the company in FY2020.

27

Digital transformation strategy
Using digital technology for seamless work operations and information sharing

Introducing the Juroku business loan “AIBiz”

We have adopted “Sansan” to build a company-wide databasefor business cards, visualizing human networks within thecompany. This not only streamlined our business operations but
also helped boost sales capacity. Local customers were also
shown how they can also adopt Sansan to reinforce sales.

We have built a new credit model that uses
AI to analyze transactions on deposit accounts
and financial information.

Advanced and faster screening (sameday approval at the quickest)

Participating in the Multi-Bank Identity Confirmation
Platform

110,000 downloads for Wallet+
The Wallet+ service, launched in December
2019, has achieved 110,000 downloads(April 2021) at a pace that far exceeded
initial expectations. Over 70% of users
are in their 40s or younger, indicatingthat the tool connects the bank with theyounger generation.
Continuous delivery of information
and approach to customers
through the app fosters coreclientele of the future.

Adopting the business card management service“Sansan” and signing a partnership agreement with
SansanUser breakdown by age group(as of March 2021)

We have participated in NEC’s Multi-Bank Identify Confirmation
Platform as a data provider. With customers’ consent,
confirmed ID information held by us is provided to data users
via this platform.

Introducing the Customer Property
Management System using tablet
devices
When receiving customer properties to be held in our care,bank employees enter their description in a tablet device, andhave the customer check the description and provide electronic
signature for verification.

28

SDGｓ・ESG
Social～Community revitalization～

Contribution to local economy

Launch of “Juroku Cross-Border View”

SocialContribution to local economy

Assisting new and venture businesses through NOBUNAGA21

Offering latest local information concerning overseas business

Discovering and fostering entrepreneurs and venture businesses

Many clients are finding it difficult to gather overseas business information due totravel restrictions imposed amidst the spread of COVID-19. The overseas
information delivery service “Juroku Cross-Border View” has been launched in
response.

Through “NOBUNAGA21,” a private-sector venture-support network establishedin collaboration with Nomura Securities and Deloitte Touche Tohmatsu, weorganized the NOBUNAGA21 2nd Pitch and NOBUNAGA21 3rd Pitch to giveentrepreneurs and venture businesses anopportunity to present their business plans.

This program streams video featuring overseas
business information, compiled by our expatriate
staff stationed at four sites (Shanghai, Singapore,
Bangkok and Hanoi) and offers online consultation
sessions with our overseas staff to help clients
deploy their business overseas.

The 20th local economy revitalization seminar
was also held online, aimed at discovering andfostering entrepreneurs and venture businesses.

Grant presentation at the local
economy revitalization seminar

Report from Hanoi
SocialContribution to local economy

Verification test for 5G-based visitor guide at Shirakawa-go

SocialContribution to local economy#OuchideHidagyu
First prize in the CAMPFIRE Cloud Funding Awards

Initiative for solving issues at a tourism destination

Coordinating the “#OuchideHidagyu” project

Juroku Research Institute, which is the Group’s think tank, has been
contracted by the Ministry of Internal Affairs and Communications to “develop
and verify solution-type local 5G services.

Amidst a rapid decline in demand for Hida Beef due to the spread of COVID-19,
we ran a campaign to expand the consumption of Hida Beef, using the ALL
Hida crowd funding. The project took out the highest first prize in the
CAMPFIRE Cloud Funding Awards, organized by Japan’s largest cloud-fundingsite “CAMPFIRE.”

For Shirakawa Village, Gifu Prefecture, aWorld Heritage site famous for
Gassho-style houses, we partnered withNTT DoCoMo, Shirakawa Village andShirakawa-go Gakuen to conduct a
verification test for developing andintroducing a 5G-based tourism service,“Next-Generation Tourism Guide System.”〇 Entry period 4/29～5/10〇 Number of supporters 10,002〇 Raised amount 114 million yen（Second-highest number of supporters and thirdhighest amount raised at the time)29

SDGｓ・ESG ～ Community revitalization ～SocialContribution to local economy

Organizing the SDGs Festival in Nagoya Marunouchi

SocialContribution to local economy

Holding the Kururu Seminar online

Building a local momentum for SDGs

Offering an adult-learning opportunity to seniors

In November 2020, we organized the “SDGs Festival in Nagoya
Marunouchi” with Tokio Marine & Nichido Fire Insurance, Aichi
Prefecture and the City of Nagoya. It involved providing panel display
depicting clients’ SDGs initiatives,

The Kururu Seminar is a part of the Gifu University – Juroku Bank collaboration
project, aimed at offering adult education to seniors (60+ years old) andrevitalizing local communities. It has attracted a total of over 20,000 people
since its launch in October 2001.

building a momentum for SDGs.

This year’s seminar was held online forthe first time due to the COVID-19
pandemic. It started out with just over
10 participants but the number has grown
to around 80 nowadays.

The Juroku Bank Nagoya Building was
decorated with the SDGs Wheel and the
Juroku Bank Group SDGs Declaration.

Online seminar

Promoting women’s empowerment
ちいきしゃかいThe project team
“Jewelia,” consisting of female bank
employees for developing products and services

Partnership
Signing a partnership agreement with Nagoya Bunri
University and the College of Nagoya Bunri University

First activity “Skill matching by the Glass Slipper project”

Partnership for solving local issues”Jewelia” is a project team established in February 2020 consisting of femalebank employees. Aimed at developing products and services, the team launched
the Skill Matching by
Glass Slipper” project to match local
women with special skills and qualifications
With local businesses in a bid to create
opportunities to empower local womenfor community revitalization. So far, there
have been six successful cases of businessmatching, catering to corporate needs forleaflet production and website design.

We have signed an agreement with Nagoya
Bunri University and the College of Nagoya
Bunri University for industrial – academic
partnership, with the aim of addressing issues
held by local communities and companies.

SocialSocialThe parties collaborate to solve issues of local
communities and local companies, thereby
promoting the generation of fresh local vitality.

Partnership agreement signing ceremony

30

SDGｓ・ESG ～Environment and Governance～
Environmental conservation
Running a design competition for “eco-activity
promotion posters” and commending entries
Environment

Environmental conservation activity in partnership with Gifu University
We work with Gifu University to conduct environmental
conservation activities in line with the memorandum ofagreement concerning environmental and conservation
collaboration, signed in April 2012. In FY2020, we ran adesign competition for eco activity promotion posters,
seeking entries from students of elementary and juniorhigh schools affiliated with the Faculty of Education at Gifu
University.

Excellence Award winner

We will continue collaborating with Gifu University inconducting environmental activities, in order to further
spread the concept of environmental conservation.

Environment

Environmental conservation

Investing in ESG bonds
Investing in ESG bonds to support initiatives for building asustainable society

We actively invest in corporate bonds 【Recent investment in ESG bonds】
associated with projects that are
Year of
NumberTotal
expected to contribute to building a
investmentof cases
amountsustainable society, e.g. renewableenergy project or social infrastructure
900 million
FY20182
development project.
yen
We
will
continue
implementing
initiatives for building a sustainable
society.

FY20193

1.9 billion yen

FY202019

21.3 billion
yen

Governance
GovernanceReinforcing corporate governance
Establishing management advisory councils (2committees) to the Board of Directors

Ensuring diversity in the Board of Directors
Initiative to have women in at least 1/3 of external
directors

Ensuring transparency and fairness in Board decision-making

release待ちEnsuring
diversity in the Board of Directors External directors

Governance

Each of the committees is chaired by an external director. Majority of the five members are
external parties. The committees provide advice on the following matters:

HR Advisory Committee
Chair External director
Members
1 x External director
2 x Internal directors
1 x External expert
Advisory contents• Matters concerning the selection of director
candidates• Matters concerning the selection of auditor
candidates• Matters concerning the appointment anddismissal of executive directors, etc.

Remuneration Advisory Committee
Chair External director
Members
1 x External director
2 x Internal directors
1 x External expert
Advisory contents• Matters concerning directors’ remunerations• Matters concerning the effectiveness of theBoard of Directors• Other important matters associated withcompany management

After the Annual General Meeting of Shareholders in June 2020, we
appointed our first female director, invited externally, to bring thenumber of external directors to 3 out of 9 Board members, further
reinforcing governance and ensuring diversity envisaging women’s
empowerment.

Before（9members）
7 internal : 2
external
Now（9 members）
6 internal : 3
external

31