Interim Results for FY2016 November 2016
Important Notice Forward-looking Statements This presentation contains statements that constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, including estimates, forecasts, targets and plans. Such forward-looking statements do not represent any guarantee by management of future performance. In many cases, but not all, we use such words as “aim,” “anticipate,” “believe,” “endeavor,” “estimate,” “expect,” “intend,” “may,” “plan,” “probability,” “project,” “risk,” “seek,” “should,” “strive,” “target” and similar expressions in relation to us or our management to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions. These statements reflect our current views with respect to future events and are subject to risks, uncertainties and assumptions. We may not be successful in implementing our business strategies, and management may fail to achieve its targets, for a wide range of possible reasons, including, without limitation: incurrence of significant credit-related costs; declines in the value of our securities portfolio; changes in interest rates; foreign currency fluctuations; decrease in the market liquidity of our assets; revised assumptions or other changes related to our pension plans; a decline in our deferred tax assets; the effect of financial transactions entered into for hedging and other similar purposes; failure to maintain required capital adequacy ratio levels; downgrades in our credit ratings; our ability to avoid reputational harm; our ability to implement our Medium-term Business Plan, realize the synergy effects of “One MIZUHO”, and implement other strategic initiatives and measures effectively; the effectiveness of our operational, legal and other risk management policies; the effect of changes in general economic conditions in Japan and elsewhere; and changes to applicable laws and regulations. Further information regarding factors that could affect our financial condition and results of operations is included in “Item 3.D. Key Information—Risk Factors” and “Item 5. Operating and Financial Review and Prospects” in our most recent Form 20-F filed with the U.S. Securities and Exchange Commission (“SEC”), which is available in the Financial Information section of our web page at www.mizuho-fg.com/index.html and also at the SEC’s web site at www.sec.gov. We do not intend to update our forward-looking statements. We are under no obligation, and disclaim any obligation, to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by the rules of the Tokyo Stock Exchange. Mizuho Financial Group, Inc. is a specified business company under "Cabinet Office Ordinance on Disclosure of Corporate Information, etc." Article 17-15 clause 2 and prepares the interim consolidated and interim non-consolidated financial statements in the second quarter. Unless otherwise specified, the financial figures used in this presentation are based on Japanese GAAP This presentation does not constitute a solicitation of an offer for acquisition or an offer for sale of any securities Definitions FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd. SC: Mizuho Securities Co., Ltd. RBC: Retail & Business Banking Company CIC: Corporate & Institutional Company GCC: Global Corporate Company GMC: Global Markets Company AMC: Asset Management Company Net Income Attributable to FG: Profit Attributable to Owners of Parent 2 Banks: Aggregate figures for BK and TB on a non-consolidated basis (Figures of BK up to 1Q FY2013 are simple aggregate figures of former Mizuho Bank and former Mizuho Corporate Bank before the merger in Jul. 2013) Group aggregated: Aggregate figures for BK, TB, SC, Asset Management One and other major subsidiaries on a non-consolidated basis Company managerial basis: Managerial figure of the respective in-house company (managerial figures based on results of former business units up to FY2015) 1
Mizuho Group Holding Company Mizuho Financial Group Asset Research & Other Major Subsidiaries Banking Trust Securities Management Consulting *1 Trust & Custody Mizuho Research Mizuho Asset Institute Services Bank Mizuho Mizuho Trust & Management Bank Securities Mizuho Information Mizuho Private Wealth Banking One & Research Management Institute (Rounded Figures) One of the Broadest Forbes Global 200 *2 Individual Comprehensive SME Coverage of Listed Customer Bases among (Non-Japanese Securities Accounts Customers Borrowers, etc. Companies in Japan Corporate Customers) Japanese Financial 24M 1.65M 100K 70% 80% Institutions Credit Ratings (As of Nov. 14, 2016) S&P Moody’s Fitch R&I JCR FG A- A1 A- A+ AA- BK / TB A A1 A- AA- AA *1: Also comprised of other departments such as BK Industry Research Dept. and TB Consulting Dept. *2: Top 200 corporations from Forbes Global 2000 (excl. financial institutions) 2
Contents 1. Interim Results for FY2016 – Executive Summary Enhancement of Balance Sheet Control - Highlights P. 5 - Balance Sheet Control Strategies P. 35 - Overview of 1H FY2016 P. 6 - Foreign Currency ALM (Liquidity Management) P. 37 - Key Points of the Financial Results P. 7 - Cross-shareholdings Disposal P. 38 Pursue Operational Excellence - Impact of the Negative Interest Rate Policy P. 8 - Measures Against Effects of Negative Interest Rate Policy P. 9 - Pursue Operational Excellence P. 40 - Non-interest Income from Customer Groups P. 10 - Initiatives to Reduce Expenses P. 41 - Securities Portfolio (Bond) P. 11 - Transition to Next-Generation IT Systems P. 42 - Securities Portfolio (Stock) P. 12 - Responding to FinTech Developments P. 43 - Credit Portfolio P. 13 - Creation of New Business P. 44 - Revised Earnings Plan of FY2016 P. 14 - Embedding a Corporate Culture that Encourages P. 45 - Net Business Profits by In-house Company P. 15 Active Participation of Our Workforce Capital Management 2. Progressive Development of “One MIZUHO” - Capital Management P. 47 - Summary of the New Medium-term Business Plan P. 17 Future Direction for Financial Institutions Towards “Society 5.0” - Progress Against Financial Targets of P. 18 - Financial Institutions in the Near Future P. 49 the Medium-term Business Plan - KPI (Key Performance Indicators) P. 19 3. Interim Financial Results for FY2016 - League Tables P. 20 - Overview of Financial Results P. 51 - Effects of Introduction of the In-house Company System P. 21 - Net Interest Income from Customer Groups P. 52 Initiatives of Each In-house Company - G&A Expenses P. 55 - Retail & Business Banking Company P. 23 - Overseas Loan Portfolio P. 56 - Corporate & Institutional Company P. 25 - Exposure to Resource Sectors P. 57 - Global Corporate Company P. 27 - Asset Management Company P. 29 4. Initiatives related to ESG - Global Markets Company P. 31 - Initiatives Related to ESG: Environment P. 59 - Global Products Unit P. 32 - Initiatives Related to ESG: Society P. 60 - Research & Consulting Unit P. 33 - Initiatives Related to ESG: Corporate Governance P. 61 - Initiatives for Governance System Enhancement P. 62 3
1. Interim Results for FY2016 – Executive Summary 2. Progressive Development of “One MIZUHO” 3. Interim Financial Results for FY2016 4. Initiatives related to ESG 4
Highlights 1 Net Income Attributable to FG: 59% progress against FY2016 plan – Net Income Attributable to FG was JPY 358.1Bn marking a 59% progress against the FY2016 plan of JPY 600.0Bn – Consolidated Net Business Profits showed a steady trend marking a 53% progress against the original FY2016 plan (JPY 750.0Bn) supported by market operations appropriately capturing market volatility and an increase in domestic Non-interest Income – Profits associated with the restructuring of SC overseas corporate structure contributed to Net Income Attributable to FG Steady start-up of the Medium-term Business Plan accompanied by 2 results in various areas – Penetration of the integrated group strategy based on customer segments under the in-house company system – Development in efforts to improve risk-return and cost-return under in-house company ROE management. Progress shown in balance sheet control through credit risk management and cross-shareholdings disposal, etc. – Promotion of operational excellence with an aim to increase added value in customer services 5 The above information includes forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. See “Forward-looking Statements” on P.1 of this presentation
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