FINANCIAL SUPPLEMENT Q1/3M FY03/2019

Transcription

1 FINANCIAL SUPPLEMENT Q1/3M FY03/2019 August 10, 2018 J Trust Co., Ltd. 1

2 IMPORTANT INFORMATION This document is for information purposes only and does not constitute an offer to sell or solicit an offer to buy J Trusts securities to any person in any jurisdiction. J Trust shall not be held liable for any damages such as direct, indirect, incidental, special, or consequential damages including loss of profits, arising out of the use of information contained herein, including through errors whether caused by negligence or otherwise. J Trust Group has adopted the International Financial Reporting Standards () since Q1 of the fiscal year ended March 31, The information contained in this document is based on company data available at the time of creation of this document. J Trust does not undertake an obligation to, and disclaim any duty to, update any of the information provided. The future performance is subject to risks and uncertainties. This English-translated document was prepared solely for the convenience of English speaking investors. If any discrepancies exist, the original Japanese version always prevails. J Trust shall not be liable for any loss or damages arising from this translation. For any inquiries, Please contact PR & IR Division, Corporate Planning Department, J Trust Co., Ltd. Tel: URL: 2

3 Table of Contents 1. Changes in Key Management Indices 2. Consolidated Financial Results for Full-Year FY03/2019 YOY Comparison By Segment 3. Progress in FY03/ Data Book Summary: Consolidated Statement of Financial Position, Consolidated Income Statement Financial in Japan (Statement of Financial Position, Income Statement) Nihon Hoshou Partir Servicer J TRUST Card Financial in South Korea and Mongolia (Statement of Financial Position, Income Statement) JT Chinae Savings Bank JT Savings Bank JT Capital TA Asset Management Financial in Southeast Asia (Statement of Financial Position, Income Statement) Bank J Trust Indonesia J TRUST INVESTMENTS INDONESIA Investment (Statement of Financial Position, Income Statement ) J TRUST ASIA Other Non-Financial es (Income Statement ) Keynote P4 P5 P6 P7 P8 P10 P12 P14 P16 P18 P20 P22 P24 P26 P28 P30 [Reference] Overseas subsidiaries (in local currency) P31 (Statement of Financial Position, Income Statement) 3

4 1. Changes in Key Management Indices Market cap (million yen) June 30, ,033 Shares outstanding 112,605,110 Share price (yen) 915 revenue breakdown (Q1 FY03/2019) FY03/2016 Full-Year J-GAAP FY03/2017 Full-Year * 1 FY03/2018 Full-Year * 2 Q1 FY03/2019 * 2 revenue 75,478 66,453 76,266 17,834 expenses 38,957 38,116 50,224 10,793 Gross operating profit 36,521 28,336 26,042 7,041 Selling, general and administrative expenses 40,635 26,431 25,493 6,634 Other income - 1,254 2, Other expenses - 2, profit/loss -4, , Non-operating income Non-operating expenses 1, Financial income ,149 Financial expenses - 1,320 1, Income (Loss) from Equity Method Investments Ordinary income (loss) -4, Extraordinary income 1, Extraordinary losses 2, Profit/loss before tax *3-5, ,705 Profit/loss attributable to owners of parent -5,712-1, ,492 profit ratio -5.45% 0.91% 3.09% 3.33% ROA* % -0.23% -0.11% 0.90% ROE* % -0.83% -0.50% 4.22% Key Initiatives of J Trust Group ( JTG ) in Q1 FY03/2019 (some of them are ongoing) I. Developments in Japan (Nihon Hoshou, NH ) April 2018 NH signed a loan guarantee agreement with Shinhan Bank Japan (SBJ) Launched a loan guarantee for real estate-backed loans by SBJ Bank. Expanding the guarantee regions of Overseas Real Estate Secured Loans provided by Saikyo Bank Ltd. July 2018 NH signed an alliance agreement with The Shonan Shinkin Bank. (KeyHolder, KH ) Started providing a loan guarantee for real estate-backed loans (Reverse Mortgage "Security life" Keikyu Collaboration Plan) by Shonan Shinkin since July 2, 2018 based on the agreement concluded on March 2018 to revitalize the local economy along the Keikyu railway line. Live Entertainment (KeyStudio): June 2018 July 2018 KH signed a collaboration agreement with ALLFUZ INC., and a basic agreement with SHOWROOM, Inc. KH established a joint venture named FA Project, Inc. with Mr. Yasushi Akimoto, Mr. Nobuyuki Akimoto, Mr. Yoshihiro Akatsuka, Y&N brothers, Inc., and A.M. Entertainment, Inc. TV Program Production (KeyProduction): II. Non-Financial 13% Financial in Southeast Asia 18% May 2018 Financial in Japan 13% Financial in South Korea and Mongolia 56% KH signed an absorption-type split agreement by way of company split (absorption split) to succeed BIGFACE's television program production business and succeeded on July 1, Developments Overseas April 2018 Resolved to acquire 60% of outstanding shares of PT OLYMPINDO Multi Finance ( OMF ), a multi finance company in Indonesia, and signed a share transfer agreement. OMF will expand the size and scope of financial service by handling new products such as finance in agricultural equipment and microfinance (group loan). May 2018 Acquired 100% ownership of Capital Continent Investment NBFI, a finance firm in Mongolia * 1 FY03/2017 results are reclassified and based on. * 2 Figures other than profit/loss attributable to owners of parent do not include those of discontinued operations. * 3 Account title under J-GAAP: Profit (loss) before income taxes * 4 ROA (Annualized) = Profit attributable to owners of parent / Total assets Note: Total assets = (Beginning assets + Ending assets) / 2 * 5 ROE (Annualized) = Profit attributable to owners of parent / Equity attributable to owners of parent (%) Note: Equity attributable to owners of parent = (Beginning assets + Ending assets) / 2 The Mongolian finance market offers industry players great benefits such as no regulations on the maximum cap on the interest rate and lower corporate tax rates than the level of Japan. May 2018 Resolved to acquire 55% of outstanding shares of ANZ Royal Bank (Cambodia) Ltd., a commercial bank in Cambodia and signed a share transfer agreement. ANZ ROYAL aims for further growth by continuing to target blue chip companies and the wealthy while focuses on expanding the retail finance business and its target markets to the more substantial and higher growth SME segments. JTG will help grow the business of ANZ ROYAL by leveraging its distinctive debt collection expertise, developing new products such as leasing, and utilizing strong network and relationship with Japanese corporates. 4

5 2. Consolidated Financial Results for Full-Year FY03/2019 YOY Comparison Q1 FY03/2018 (Apr. - June 2017) Q1 FY03/2019 (Apr. - June 2018) Result (%) Result (%) YOY Change YOY (%) Major factors behind the changes + In South Korea, interest income increased because of the increases in loans mainly for corporates; and securities in the banking business. Interest income increased by changing the presentation of revenue on purchased receivables in TA Asset Management (TAA). revenue 17, , Although loans in the banking business are gradually increasing, interest income decreased because the average lending interest rate was lowered in Bank J Trust Indonesia (BJI). Sales revenue in Keynote decreased because some detached housing deliveries were postponed to after July. Interest income in JTA decreased. expenses 9, , , expenses increased in the banking business in South Korea and Indonesia because provision for doubtful accounts increased upon the introduction of 9 from FY03/2019. SG&A expenses 6, , Commission fee increased because of the increases in M&A and litigation costs in J Trust and BJI. Commission fee increased in J Trust Asia (JTA) because of the increase in litigation costs on GL. Other income and expenses profit (loss) Financial income and expenses Income (loss) from Equity Method Investments Profit (loss) before tax , , , , , , Foreign exchange gain of 1,132 million yen was recorded mainly in JTA due to the appreciation of the USD against SGD compared to the previous year in which related losses were recorded due to the depreciation. Income tax expense Profit (loss) attributable to owners of parent , , Note: Figures other than profit/loss attributable to owners of parent do not include those of discontinued operations. 5

6 2. Consolidated Financial Results for Full-Year FY03/2019 By Segment Financial in Japan Financial in South Korea and Mongolia Financial in Southeast Asia Q1 Q1 FY03/2018 FY03/2019 Difference Difference (Apr. - June (Apr. - June (%) 2017) 2018) Major factors behind the changes revenue 2,314 2, Remained almost the same level as Q1 FY03/2018. profit 1, revenue 8,820 10,172 1, profit 1,647 1, revenue 3,592 3, profit expenses increased as a result of an increase in provision for doubtful accounts by reviewing the future cash flows of purchased receivables. Interest income increased because of the increases in loans mainly for corporates, and securities in the banking business in South Korea. Interest income increased by changing the presentation of revenue on purchased receivables in TAA. expenses increased due to the increase in provision for doubtful accounts upon introduction of 9 from FY03/2019. (Please refer to p.17 and 19.). Interest income fell because the average lending rate was lowered although the loans in the banking business are gradually increasing in BJI. revenue decreased. expenses increased in BJI because provision for doubtful accounts increased due to the deterioration in credit ratings of receivables upon the introduction of 9 from FY03/2019. (Please refer to p. 25.) General Entertainment Real Estate revenue Although Highlights Entertainment (HE) recorded inventory valuation losses, operating revenue increased and operating profit expenses decreased through the effects of sales campaign excluding the contract work for 117 million yen in HE in the previous term. revenue 1,526 1, Both operating revenue and profit were down. This is because some profit detached housing deliveries were postponed to after July, although the number of transactions increased. Investment revenue Interest income decreased in JTA. (Please refer to p.29.) profit SG&A expenses increased along with an increase in litigation cost on GL. Other business Consolidated revenue revenue and profit decreased compared to the previous profit revenue 17,655 17, profit 2, , year in which Keynote recorded revenue from a long-term contract that spanned FY2017- FY2018 in its commercial facility construction business. Note: Figures other than profit/loss attributable to owners of parent do not include those of discontinued operations. 6

7 3. Progress in FY03/2019 FY03/2019 (Forecast) Q1 FY03/2019 (Actual) Achievement rate (%) revenue 83,378 17, Milestones Financial in Japan 9,923 2, Focus on both credit guarantee and receivables collection business. Financial in South Korea and Mongolia Financial in Southeast Asia General Entertainment 37,995 10, ,230 3, As a measure against a decline in interest income caused by sluggish growth of the loan balance after South Korean authorities strengthen regulations on loan disbursements, we will secure revenue by: (1) Changing loan portfolio mix Increase customers with good credit score by reviewing the screening process. (2) Strengthening corporate loan portfolio. (3) Diversifying revenue sources other than interest income by starting credit guarantee on assigned accounts receivables and developing other guarantee schemes, etc. (1) Ensure profitability and achieve higher interest income. Focus on acquiring good quality receivables through tighter credit screening. (2) Aim for increasing lower risk, stable income other than interest on loans by increasing the ratio of high rated bonds while reinforcing liquidity management through means such as obtaining deposits (interest rate: 6.5% %) from BPR (people s credit bank). (3) Enhance branding and marketing, and improve customer service with a new core banking system. 6, Expect revenue contribution from new business in KeyHolder Group. Real Estate 6,679 1, Increase the number of deliveries of ready-built houses. Investment 1, Pursue investments with high returns. Expand business by investing proactively in projects that create synergies with JTG s business. Other business 2, Focus on the commercial facility construction business in Keynote. profit 7, Financial in Japan 4, Secure stable operating revenue. Select properties with a good location and high occupancy in condominium loans in the credit guarantee business to maintain the quality of guaranteed loans. Financial in South Korea and Mongolia 2,427 1, Change loan portfolio and aim for stable revenue base. Expect the increase in provision for doubtful accounts due to the introduction of 9 from FY03/2019. Anticipate lower profit through the effects of tighter regulations in South Korea. Financial in Southeast Asia 2, (1) Secure stable operating revenue. (2) Reduce COF (Cost of Funds) by further lowering deposit interest rates. Curtail high-interest term deposits, gain low-interest deposits through enhanced promotion and increase CASA ratio (liquidity ratio). (3) Strengthen post-disbursement monitoring to collect NPLs and keep them low. Exclusive teams or loan collection specialists (advisor) are assigned the task. Reduce bad debt expenses through controlling related risks. (4) Pursue cost-cutting efforts through management of G&A expenses. General Entertainment Expect profit contribution from new business in KeyHolder Group. Real Estate Improve profit margin through enhanced sales performance and higher inhouse construction ratios. Investment Focus on M&A activities to maximize ROI. Other business

8 The data in excel version is on our website: 1) Summary: Consolidated Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 82,683 84,723-2, % (a) Loan balance 435, ,786 11, % Accounts receivable - operating loans 63,406 63, % Loans by banking business 368, ,779 11, % Advances paid - installment 2,437 2, % Finance lease receivables % Purchased receivables 16,571 16, % Other accounts receivables 16,372 15,188 1, % Operational investment securities 2,132 3,242-1, % Securities 37,915 37, % Other financial assets 56,737 52,331 4, % Provision for doubtful accounts -30,741-25,214-5,527 - Assets held for sale 2,282 1, % Tangible assets 3,019 3, % Investment property % Goodwill 29,474 29, % Intangible assets 2,888 3, % Other assets 12,304 11,089 1, % Total assets 667, ,961 10, % Liabilities Deposit 416, ,509 12, % Total interest-bearing liabilities 80,860 78,727 2, % Loans 48,747 45,906 2, % Corporate bond 32,113 32, % Other liabilities 25,914 23,947 1, % Total liabilities 523, ,184 17, % Equity Attributable to owners of parent 138, ,366-6, % Non-controlling interest 6,111 6, % Total equity 144, ,776-6, % Total liabilities and equity 667, ,961 10, % (Size of guarantees)* 1 163, ,718 17, % * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 23,951 22,821 1, % (c) Provision for doubtful accounts 30,741 25,214 5, % [1] Provision for doubtful accounts 23,534 18,688 4, % NPL ratio (gross) (b) / (a) 5.5% 5.4% 0.1% - NPL ratio (net) ((b) - [1]) / (a) 0.1% 1.0% -0.9% - [2] Provision for doubtful accounts (for others) 7,207 6, % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 8

9 1) Summary: Consolidated Income Statement (unaudited) 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 17,834 17,834 17, % Total Interest income 14,112 14,112 12,238 1, % Interest income (loan, credit card, etc.) 12,896 12,896 11,080 1, % Book value adjustment gain/loss % Interest on securities % Total operating revenue other than interest income 3,722 3,722 5,417-1, % Guarantee commission received % Gain on sale of securities % Gain on bad debts recovered % Commission income % Sales in Real Estate 1,199 1,199 1, % Sales in General Entertainment % Other operating revenue 1,043 1,043 1, % expenses 10,793 10,793 9,444 1, % Total interest expenses 4,477 4,477 4, % Interest on deposits 3,707 3,707 3, % Interest on loans % Interest on bonds % Other interest expenses: % Total operating expenses other than interest expenses 6,316 6,316 5, % Loss on sale of securities % Expenses related to bad debts 3,929 3,929 2,498 1, % Other cost of sales 1,602 1,602 2, % Other operating expenses % Selling, general and administrative expenses 6,634 6,634 6, % Personnel expenses 3,300 3,300 3, % Depreciation % Other selling, general and administrative expenses 2,992 2,992 2, % Other income % Other expenses % profit ,457-1, % Financial income 1,149 1, ,130 - Financial expenses % Income from Equity Method Investments % Loss from Equity Method Investments Profit/loss before tax 1,705 1,705 2, % Income tax expense % Profit/loss (continuing operations) 1,347 1,347 1, % Profit/loss (discontinued operations) % Profit/loss 1,347 1,347 1, % Profit/loss attributable to owners of parent 1,492 1,492 1, % Non-controlling interest ROA (Annualized)* 1 (%) 0.90% 0.90% 1.15% -0.25% - * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 9

10 2) Financial in Japan: Nihon Hoshou Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 5,738 7,106-1, % (a) Loan balance 2,378 2, % Accounts receivable - operating loans 2,378 2, % Loans by banking business Advances paid - installment Finance lease receivables Purchased receivables 11,688 11, % Other accounts receivables 11,707 10, % Operational investment securities Securities Other financial assets 1,623 1, % Provision for doubtful accounts Assets held for sale Tangible assets % Investment property % Goodwill Intangible assets % Other assets % Total assets 33,564 34, % Liabilities Deposit Total interest-bearing liabilities 5,813 6, % Loans 5,543 5, % Corporate bond Other liabilities 10,998 10, % Total liabilities 16,812 16, % Equity Attributable to owners of parent 16,752 17,869-1, % Non-controlling interest Total equity 16,752 17,869-1, % Total liabilities and equity 33,564 34, % (Size of guarantees)* 1 159, ,881 17, % * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL % (c) Provision for doubtful accounts % [1] Provision for doubtful accounts % NPL ratio (gross) (b) / (a) 15.4% 14.6% 0.8% - NPL ratio (net) ((b) - [1]) / (a) 11.3% 10.3% 1.0% - [2] Provision for doubtful accounts (for others)* % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 10

11 2) Financial in Japan: Nihon Hoshou 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 2,066 2,066 2, % Total Interest income 1,439 1, % Interest income (loan, credit card, etc.) 1,223 1, % Book value adjustment gain/loss % Interest on securities Total operating revenue other than interest income , % Guarantee commission received % Gain on sale of securities Gain on bad debts recovered % Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses % Total interest expenses % Interest on deposits Interest on loans % Interest on bonds Other interest expenses: % Total operating expenses other than interest expenses % Loss on sale of securities Expenses related to bad debts % Other cost of sales % Other operating expenses % Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses % profit 1,034 1,034 1, % Financial income % Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax 1,064 1,064 1, % Income taxes % Profit/loss , % ROA (Annualized)* 1 (%) 10.21% 10.21% 12.80% -2.59% - Income Statement (unaudited) * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 11

12 2) Financial in Japan: Partir Servicer Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents % (a) Loan balance Accounts receivable - operating loans Loans by banking business Advances paid - installment Finance lease receivables Purchased receivables 1,347 1, % Other accounts receivables Operational investment securities Securities Other financial assets % Provision for doubtful accounts Assets held for sale Tangible assets % Investment property Goodwill Intangible assets % Other assets % Total assets 2,315 2, % Liabilities Deposit Total interest-bearing liabilities % Loans % Corporate bond Other liabilities % Total liabilities 1,236 1, % Equity Attributable to owners of parent 1,078 1, % Non-controlling interest Total equity 1,078 1, % Total liabilities and equity 2,315 2, % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL (c) Provision for doubtful accounts [1] Provision for doubtful accounts NPL ratio (gross) (b) / (a) NPL ratio (net) ((b) - [1]) / (a) [2] Provision for doubtful accounts (for others)* * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 12

13 2) Financial in Japan: Partir Servicer 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue % Total Interest income % Interest income (loan, credit card, etc.) % Book value adjustment gain/loss % Interest on securities Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered % Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses Total interest expenses % Interest on deposits Interest on loans % Interest on bonds Other interest expenses: % Total operating expenses other than interest expenses Loss on sale of securities Expenses related to bad debts Other cost of sales Other operating expenses Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses profit Financial income Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax Income taxes Profit/loss ROA (Annualized)* 1 (%) -5.60% -5.60% -8.82% 3.22% - Income Statement (unaudited) * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 13

14 2) Financial in Japan: J TRUST Card Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents % (a) Loan balance 2,444 2, % Accounts receivable - operating loans % Loans by banking business Advances paid - installment 2,437 2, % Finance lease receivables Purchased receivables Other accounts receivables Operational investment securities Securities Other financial assets % Provision for doubtful accounts Assets held for sale Tangible assets % Investment property Goodwill Intangible assets % Other assets 15,000 15, % Total assets 17,916 17, % Liabilities Deposit Total interest-bearing liabilities 1,363 1, % Loans 1,363 1, % Corporate bond Other liabilities % Total liabilities 1,806 1, % Equity Attributable to owners of parent 16,110 16, % Non-controlling interest Total equity 16,110 16, % Total liabilities and equity 17,916 17, % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL % (c) Provision for doubtful accounts % [1] Provision for doubtful accounts % NPL ratio (gross) (b) / (a) 0.0% 0.0% -0.0% - NPL ratio (net) ((b) - [1]) / (a) 0.0% 0.0% 0.0% - [2] Provision for doubtful accounts (for others)* % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 14

15 2) Financial in Japan: J TRUST Card 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue % Total Interest income % Interest income (loan, credit card, etc.) % Book value adjustment gain/loss Interest on securities Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses % Total interest expenses % Interest on deposits Interest on loans % Interest on bonds Other interest expenses: Total operating expenses other than interest expenses % Loss on sale of securities Expenses related to bad debts % Other cost of sales Other operating expenses % Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses profit % Financial income % Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax % Income taxes % Profit/loss % ROA (Annualized)* 1 (%) 0.22% 0.22% 0.18% 0.04% - Income Statement (unaudited) * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 15

16 3) Financial in South Korea and Mongolia: JT Chinae Savings Bank Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 29,270 20,246 9, % (a) Loan balance 183, ,445 8, % Accounts receivable - operating loans Loans by banking business 183, ,445 8, % Advances paid - installment Finance lease receivables Purchased receivables Other accounts receivables 1,417 1, % Operational investment securities Securities 10,443 7,570 2, % Other financial assets 10,876 10, % Provision for doubtful accounts -10,435-8,568-1,867 - Assets held for sale Tangible assets % Investment property Goodwill % Intangible assets % Other assets % Total assets 227, ,988 18, % Liabilities Deposit 205, ,511 19, % Total interest-bearing liabilities 1,976 1, % Loans Corporate bond 1,976 1, % Other liabilities 4,386 5, % Total liabilities 211, ,654 19, % Equity Attributable to owners of parent 15,363 16, % Non-controlling interest Total equity 15,363 16, % Total liabilities and equity 227, ,988 18, % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 11,046 10, % (c) Provision for doubtful accounts 10,435 8,568 1, % [1] Provision for doubtful accounts 10,394 8,545 1, % NPL ratio (gross) (b) / (a) 6.0% 6.2% -0.2% - NPL ratio (net) ((b) - [1]) / (a) 0.4% 1.4% -1.0% - [2] Provision for doubtful accounts (for others)* % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 16

17 3) Financial in South Korea and Mongolia: JT Chinae Savings Bank Income Statement (unaudited) 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 5,782 5,782 5, % Total Interest income 5,220 5,220 5, % Interest income (loan, credit card, etc.) 5,098 5,098 5, % Book value adjustment gain/loss Interest on securities % Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses 3,408 3,408 2, % Total interest expenses 1,236 1,236 1, % Interest on deposits 1,183 1,183 1, % Interest on loans % Interest on bonds Other interest expenses: % Total operating expenses other than interest expenses 2,171 2,171 1, % Loss on sale of securities Expenses related to bad debts 1,799 1,799 1, % Other cost of sales Other operating expenses % Selling, general and administrative expenses 1,532 1,532 1, % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income Other expenses profit % Financial income Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax % Income taxes Profit/loss % ROA (Annualized)* 1 (%) 1.62% 1.62% 1.84% -0.22% - * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 17

18 3) Financial in South Korea and Mongolia: JT Savings Bank Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 7,422 12,366-4, % (a) Loan balance 92,106 91, % Accounts receivable - operating loans Loans by banking business 92,106 91, % Advances paid - installment Finance lease receivables Purchased receivables Other accounts receivables % Operational investment securities Securities 6,046 2,648 3, % Other financial assets 6,525 5, % Provision for doubtful accounts -2,679-2, Assets held for sale Tangible assets % Investment property Goodwill Intangible assets % Other assets % Total assets 110, , % Liabilities Deposit 97,223 98,640-1, % Total interest-bearing liabilities Loans Corporate bond Other liabilities 3,631 2,629 1, % Total liabilities 100, , % Equity Attributable to owners of parent 9,625 9, % Non-controlling interest Total equity 9,625 9, % Total liabilities and equity 110, , % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 2,682 2, % (c) Provision for doubtful accounts 2,679 2, % [1] Provision for doubtful accounts 2,660 2, % NPL ratio (gross) (b) / (a) 2.9% 3.2% -0.3% - NPL ratio (net) ((b) - [1]) / (a) 0.0% 0.9% -0.9% - [2] Provision for doubtful accounts (for others)* % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 18

19 3) Financial in South Korea and Mongolia: JT Savings Bank Income Statement (unaudited) 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 2,417 2,417 1, % Total Interest income 2,227 2,227 1, % Interest income (loan, credit card, etc.) 2,135 2,135 1, % Book value adjustment gain/loss Interest on securities % Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses 1,366 1, % Total interest expenses % Interest on deposits % Interest on loans Interest on bonds Other interest expenses: % Total operating expenses other than interest expenses % Loss on sale of securities Expenses related to bad debts % Other cost of sales Other operating expenses % Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses % profit % Financial income Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax % Income taxes % Profit/loss % ROA (Annualized)* 1 (%) 1.14% 1.14% 1.31% -0.17% - * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 19

20 3) Financial in South Korea and Mongolia: JT Capital Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 7,012 6, % (a) Loan balance 55,182 55, % Accounts receivable - operating loans 54,647 55, % Loans by banking business Advances paid - installment Finance lease receivables Purchased receivables Other accounts receivables % Operational investment securities Securities Other financial assets 2,081 2, % Provision for doubtful accounts -2,481-2, Assets held for sale Tangible assets % Investment property Goodwill Intangible assets % Other assets % Total assets 62,897 63, % Liabilities Deposit Total interest-bearing liabilities 48,285 48, % Loans 18,780 18, % Corporate bond 29,504 30, % Other liabilities % Total liabilities 48,949 48, % Equity Attributable to owners of parent 13,948 14, % Non-controlling interest Total equity 13,948 14, % Total liabilities and equity 62,897 63, % (Size of guarantees)* % * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 4,145 3, % (c) Provision for doubtful accounts 2,481 2, % [1] Provision for doubtful accounts 2,472 2, % NPL ratio (gross) (b) / (a) 7.5% 7.0% 0.5% - NPL ratio (net) ((b) - [1]) / (a) 3.0% 3.2% -0.2% - [2] Provision for doubtful accounts (for others)* % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 20

21 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 1,423 1,423 1, % Total Interest income 1,345 1,345 1, % Interest income (loan, credit card, etc.) 1,345 1,345 1, % Book value adjustment gain/loss Interest on securities Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered % Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue expenses % Total interest expenses % Interest on deposits Interest on loans % Interest on bonds % Other interest expenses: Total operating expenses other than interest expenses % Loss on sale of securities Expenses related to bad debts % Other cost of sales Other operating expenses % Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses profit % Financial income Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax % Income taxes % Profit/loss % ROA (Annualized)* 1 (%) 0.44% 0.44% 1.60% -1.16% - 3) Financial in South Korea and Mongolia: JT Capital Income Statement (unaudited) * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 21

22 3) Financial in South Korea and Mongolia: TA Asset Management Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents 2,647 4,415-1, % (a) Loan balance 5,140 5, % Accounts receivable - operating loans 5,140 5, % Loans by banking business Advances paid - installment Finance lease receivables Purchased receivables 2,468 2, % Other accounts receivables % Operational investment securities Securities Other financial assets 2, ,778 - Provision for doubtful accounts -2,352-2, Assets held for sale Tangible assets % Investment property Goodwill Intangible assets % Other assets % Total assets 11,565 11, % Liabilities Deposit Total interest-bearing liabilities Loans Corporate bond Other liabilities % Total liabilities % Equity Attributable to owners of parent 11,425 11, % Non-controlling interest Total equity 11,425 11, % Total liabilities and equity 11,565 11, % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 2,409 2, % (c) Provision for doubtful accounts 2,352 2, % [1] Provision for doubtful accounts 2,207 2, % NPL ratio (gross) (b) / (a) 46.9% 40.8% 6.0% - NPL ratio (net) ((b) - [1]) / (a) 3.9% 4.8% -0.8% - [2] Provision for doubtful accounts (for others)* * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 22

23 3) Financial in South Korea and Mongolia: TA Asset Management Income Statement (unaudited) 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue % Total Interest income % Interest income (loan, credit card, etc.) % Book value adjustment gain/loss % Interest on securities % Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities Gain on bad debts recovered % Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses Total interest expenses Interest on deposits Interest on loans Interest on bonds Other interest expenses: Total operating expenses other than interest expenses Loss on sale of securities Expenses related to bad debts Other cost of sales Other operating expenses Selling, general and administrative expenses % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses % profit % Financial income % Financial expenses Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax % Income taxes % Profit/loss % ROA (Annualized)* 1 (%) 7.72% 7.72% 7.08% 0.64% - * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 23

24 4) Financial in Southeast Asia: Bank J Trust Indonesia Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / /03 Difference 2018/03 Difference Assets Cash and cash equivalents 4,914 5, % (a) Loan balance 93,244 90,791 2, % Accounts receivable - operating loans Loans by banking business 93,244 90,791 2, % Advances paid - installment Finance lease receivables Purchased receivables Other accounts receivables % Operational investment securities Securities 21,263 26,939-5, % Other financial assets 15,154 12,675 2, % Provision for doubtful accounts -10,066-8,022-2,043 - Assets held for sale 2,279 1, % Tangible assets 1,253 1, % Investment property Goodwill Intangible assets % Other assets 2,467 2, % Total assets 132, ,994-2, % Liabilities Deposit 119, , % Total interest-bearing liabilities 4,418 4, % Loans 2,763 2, % Corporate bond 1,655 1, % Other liabilities 3,337 2, % Total liabilities 127, , % Equity Attributable to owners of parent 5,119 8,157-3, % Non-controlling interest Total equity 5,119 8,157-3, % Total liabilities and equity 132, ,994-2, % (Size of guarantees)* 1 3,911 3, * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL 3,249 2, % (c) Provision for doubtful accounts 10,066 8,022 2, % [1] Provision for doubtful accounts 5,735 3,807 1, % NPL ratio (gross) (b) / (a) 3.5% 2.6% 0.9% - NPL ratio (net) ((b) - [1]) / (a) 0.0% 0.0% 0.0% - [2] Provision for doubtful accounts (for others)* 2 4,330 4, % * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 24

25 2019/03 Q1 FY03/2018 Q1 2018/03 Q1 Q2 Q3 Q4 Difference Difference revenue 3,010 3,010 3, % Total Interest income 2,765 2,765 2, % Interest income (loan, credit card, etc.) 2,378 2,378 2, % Book value adjustment gain/loss Interest on securities % Total operating revenue other than interest income % Guarantee commission received Gain on sale of securities % Gain on bad debts recovered % Commission income % Sales in Real Estate Sales in General Entertainment Other operating revenue % expenses 2,860 2,860 2, % Total interest expenses 2,029 2,029 2, % Interest on deposits 1,940 1,940 2, % Interest on loans % Interest on bonds Other interest expenses: % Total operating expenses other than interest expenses % Loss on sale of securities % Expenses related to bad debts % Other cost of sales Other operating expenses % Selling, general and administrative expenses 1,069 1,069 1, % Personnel expenses % Depreciation % Other selling, general and administrative expenses % Other income % Other expenses % profit Financial income Financial expenses % Income from Equity Method Investments Loss from Equity Method Investments Profit/loss before tax Income taxes Profit/loss ROA (Annualized)* 1 (%) -2.36% -2.36% 0.34% -2.70% - 4) Financial in Southeast Asia: Bank J Trust Indonesia Income Statement (unaudited) * 1 ROA = Profit attributable to owners of parent / total assets (%) Note: Total assets=(beginning assets + ending assets) / 2 25

26 4) Financial in Southeast Asia: J TRUST INVESTMENTS INDONESIA Statement of Financial Position (unaudited) FY03/2019 Ended 2018/ / / / / /03 Difference Difference Assets Cash and cash equivalents % (a) Loan balance Accounts receivable - operating loans Loans by banking business Advances paid - installment Finance lease receivables Purchased receivables % Other accounts receivables Operational investment securities Securities Other financial assets % Provision for doubtful accounts Assets held for sale % Tangible assets % Investment property Goodwill Intangible assets % Other assets % Total assets 2,252 2, % Liabilities Deposit Total interest-bearing liabilities 2,042 2, % Loans 2,042 2, % Corporate bond Other liabilities % Total liabilities 2,123 2, % Equity Attributable to owners of parent % Non-controlling interest Total equity % Total liabilities and equity 2,252 2, % (Size of guarantees)* * 1 Includes size of guarantees in banking business. Provision for doubtful accounts and others (b) Balance of NPL (c) Provision for doubtful accounts [1] Provision for doubtful accounts NPL ratio (gross) (b) / (a) NPL ratio (net) ((b) - [1]) / (a) [2] Provision for doubtful accounts (for others)* * 2 Provision for doubtful accounts (for others) is the provision for purchased receivables, subrogation receivables, some membership, investments and other assets. 26