Summary of Financial Results for Fiscal 2017 <Under Japanese GAAP> May 15, 2018

Transcription

1 Summary of Financial Results for Fiscal 07 <Under Japanese GAAP> May 5, 08

2 Contents Overview of Income Statement Overview of Balance Sheet Overview of Loans Non-interest Income P. P.3 P.4 P.5 Financial Soundness () Financial Soundness () P.6 P.7 BIS Capital Ratio Earnings Plan for FY08 Reference: Mizuho Securities Reference: Progress of the Medium-term Business Plan P.8 P.9 P.0 P. Definitions FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd. SC: Mizuho Securities Co., Ltd. Banks: Aggregate figures for BK and TB on a non-consolidated basis Group aggregate: Aggregate figures for BK, TB, SC and other major subsidiaries on a non-consolidated basis

3 Overview of Income Statement Summary of Financial Results Net Income Attributable to FG for FY07 was JPY 576.5bn, achieved 04% against the earnings plan of JPY 550.0bn for FY07 Regarding Consolidated Net Business Profits, while Gross Profits in Customer Groups ( Banks) maintained the same level as last FY supported by the improvement in Non-interest Income, Gross Profits in Trading & Others ( Banks) decreased mainly due to the business environment inside and outside Japan Meanwhile, Reversal in Credit-related Costs and Net Gains related to Stocks due to disposal of ETFs and cross-shareholdings contributed to Net Income Attributable to FG Consolidated Consolidated Gross Profits, Consolidated Net Business Profits Consolidated Net Business Profits + FY07 Changes from FY06 3 Net Gains related to ETFs and others Credit-related Costs Net Gains (Losses) related to Stocks Net Gains (Losses) related to Stocks - Net Gains related to ETFs and others Ordinary Profits Net Income Attributable to FG Profit Attributable to Owners of Parent. Consolidated Gross Profits - G&A Expenses (excluding Non- Recurring Losses) + Equity in Income from Investments in Affiliates and certain other consolidation adjustments 3. Net Gains related to ETFs of Banks and Net gain (loss) on operating investment securities of SC Consolidated 4. New management accounting rules were applied at the beginning of FY7. Figures for FY6 are recalculated based on the new rules Reference: <Exchange rate (TTM)> Mar-8: USD = JPY 06.7 (Mar-7: USD = JPY.0) Banks FY07 Changes from FY06 Gross Profits, Customer Groups, Trading & Others G&A Expenses (excluding Non-Recurring Losses) Net Business Profits Credit-related Costs Net Gains (Losses) related to Stocks Ordinary Profits Net Income SC Net Operating Revenues SG&A Expenses Ordinary Income Net Income Attributable to SC Difference in Net Income b/w Consolidated and Banks+SC Asset Management One Major Ov erseas Subsidiaries (BK) 36.. Mizuho Credit Guarantee.9-8. Other Subsidiaries & Consolidation Adj Including Net Gains related to ETFs of JPY 70.bn (+JPY 37.5bn YoY) 6. Mizuho Securities USA and Shinko Asset Management became unconsolidated from SC Consolidated since Q FY6 and 3Q FY6, respectively. 7. Simple aggregate of Ordinary Profits of SC Consolidated (FY7) and Mizuho Securities USA (FY7) was JPY 60.bn Reference: Simple aggregate of Ordinary Income of SC consolidated (FY6) - Shinko Asset Management (H FY6) + Mizuho Securities USA (Q-4Q FY6) was JPY 9.5bn 8. Including Net Income of Mizuho Securities USA of JPY 9.3bn 4 4

4 Overview of Balance Sheet Balance Sheet (as of Mar-8) Total Assets: JPY 05tn (+JPY 4.5tn) Loans: JPY 79tn (+JPY.0tn) Deposits and Negotiable Certificates of Deposit (NCD): Consolidated Figures in ( ) represent changes from Mar-7 Loan Balance Period-end Balance (JPY tn) Outside Japan Japanese Gov., etc. Individuals 70. -JPY 0.5tn from Mar-7 Banks +JPY 0.5tn from Sep Securities: JPY 34tn (+JPY.8tn) JGBs: JPY 5tn (+JPY.9tn) Foreign Bonds: JPY 8tn (-JPY 0.8tn) Stocks: JPY 3.9tn (-JPY 0.0tn) Other Assets: JPY 9tn (+JPY.6tn) JPY 36tn (+JPY 5.7tn) Other Liabilities: JPY 58tn (-JPY.8tn) Net Assets: JPY 9tn (+JPY 0.5tn) In Japan Sep-4 Mar-5 Sep-5 Mar-6 Sep-6 Mar-7 Sep-7 Mar-8 Reference: Non-JPY denominated Loans and Deposits structure 4 Period-end Balance (USD bn) 3 SMEs Large Corp., etc % 9. Non-JPY denominated Loans Non-JPY denominated Customer Deposits Proportion of Deposit to Loan 70% 5, 6 75% BK, management account 73% Mar-5 Mar-6 Mar-7 Mar-8 5, 6. Excluding loans to FG. Banking account. Housing and Consumer Loans 3. Calculated by deducting Housing and Consumer Loans from Loans to SMEs and Individual Customers 4. BK (including the subsidiaries in China, the US, the Netherlands, Indonesia, etc.) 5. Including Non-JPY loans and deposits in Japan 6. Changed in management account rules in FY7. Figures from Mar-5 to Mar-7 are recalculated based on the new rules 3

5 Overview of Loans Loan Balance in Japan Loan and Deposit Rate Margin in Japan Banks Average Balance (%) (JPY tn) +JPY 0.4tn YoY Returns on Loans and Bills Discounted a Loan and Deposit Rate Margin a - b Costs of Deposits and Debentures b Banks +JPY 0.tn from H FY H FY4 H FY4 H FY5 H FY5 H FY6 H FY6 H FY7 H FY7 Loan Balance outside Japan Average Balance +USD 3.9bn YoY (USD bn) EMEA Americas Asia , 4 BK, management account H FY4 H FY4 H FY5 H FY5 H FY6 H FY6 H FY7 H FY7 Loan Spread (%) , 4 Outside Japan Loans to Middle Market Firms & SMEs in Japan Loans to Large Corporate Banking Customers in Japan BK, management account H FY4 H FY4 H FY5 H FY5 H FY6 H FY6 H FY7 H FY7 +USD 6.7bn from H FY7 H FY4 H FY4 H FY5 H FY5 H FY6 H FY6 H FY7 H FY7. Excluding loans to FG and the Japanese Government, etc. Banking account. Domestic operations, excluding loans to financial institutions (including FG) and the Japanese Government, etc. 3. BK (including the subsidiaries in China, the US, the Netherlands, Indonesia, Malaysia, Russia, Brazil and Mexico) 4. Changes in management account rules in Q FY7. Figures from H FY4 to H FY6 are recalculated based on the new rules 4

6 Non-interest Income Non-interest Income from Customer Groups BK (in Japan) BK (outside Japan) Trust & Asset Management Securities Others Group aggregate, management account (rounded figures) +JPY bn YoY (excl. impact of changes in exchange rate approx. +JPY 7bn) FY5 FY6 FY7 Reference: Breakdown of BK (Japan) Non-interest Income Solution Business Related Investment Trusts & Individual Annuities Settlement & Foreign Exchange Others FY5 FY6 FY7 Reference: Investment Products Banks (left) SC Retail & Business Banking Division (right) (JPY tn) (JPY tn) Amount of Equity Investment Trusts Sold Amount of Individual Annuities Sold Amount of Japanese Bonds Sold Amount of Investment Trusts Sold (excl. MMF) Amount of Foreign Bonds Sold Balance of Investment Products Assets Under Management FY5 FY6 FY7 Group aggregate, management account (rounded figures) FY5 FY6 FY7. Changes in management account rules in Q FY7. The original figures before the recalculation were FY5: JPY 888bn and FY6: JPY 865bn. Total of Individual Annuities, Investment Trusts (excl. MMF) and non-jpy deposits 5

7 Financial Soundness () Disclosed Claims under the FRA Credit-related Costs, Banks Banks (JPY tn) Disclosed Claims under the FRA NPL Ratio Credit-related Costs Credit-related Costs Ratio 3 8bps % %.00% bps % -3bps -5bps Mar-5 Mar-6 Mar-7 Mar-8. Financial Reconstruction Act. Banking account + Trust account FY4 FY5 FY6 FY7 3. Ratio of Credit-related Costs against total claims 6

8 Financial Soundness () Unrealized Gains/Losses on Other Securities JGB Portfolio, 4 Banks, acquisition cost basis Others Japanese Bonds Japanese Stocks, Consolidated (JPY tn) Treasury Discount Bills Floating-rate Notes Medium & Long-term Bonds ,855., , Mar-5 Mar-6 Mar-7 Mar Ave. Remaining Period 3.6y rs.5y rs.4y rs.5y rs,3.,603.9,838.7,984. Japanese Stock Portfolio -JPY 398.0bn from Mar-5 Consolidated, acquisition cost basis,96.9,847.,687.5, Mar-5 Mar-6 Mar-7 Mar-8 Mar-5 Mar-6 Mar-7 Mar-8. Other Securities which have readily determinable fair values. Including bonds with remaining period of one year or less 3. Excluding floating-rate notes 4. The base amount to be recorded directly to Net Assets after tax and other necessary adjustments 7

9 BIS Capital Ratio Overview of BIS Capital Ratio Consolidated Mar-7 Mar-8 CET Capital Ratio () Common Equity Tier (CET) Capital 7,00.6 7,437.0 Capital, Stock Surplus and Retained Earnings 7, ,387.8 () Additional Tier Capital,09.8,755. Additional Tier capital instruments 760.0,0.0 Eligible Tier capital instruments subject to phase-out arangements (3) Tier Capital,839.4,668. Tier capital instruments Eligible Tier capital instruments subject to phase-out arangements (4) Total Capital ()+()+(3) 0, ,860.4 (5) Risk weighted Assets 6,77. 59,58.9 Credit Risk Assets 56, ,647.3 Market Risk Equivalent Assets,8.8,470.3 Operational Risk Equivalent Assets 3,374. 3,4. (6) Total Capital Ratio 6.8% 8.4% Tier Capital Ratio 3.30% 5.44% CET Capital Ratio.34%.49% CET Capital Ratio (fully-effective basis) CET Capital Ratio (fully-effective basis, excl. Net Unrealized Gains on Other Securities).37%.49% 9.7% 0.5% (7) Capital Buffer Ratio 6.84% 7.99% (8) Leverage Ratio 3.95% 4.8% Steadily strengthened the CET Capital - CET Capital Ratio as of Mar-8:.49% - CET Capital Ratio (excluding Net Unrealized Gains on Other Securities) : 0.5% Adequate level of Additional Tier and Tier Capital - Tier Capital Ratio as of Mar-8: 5.44% - Total Capital Ratio: 8.4% - Capital Buffer Ratio : 7.99% Leverage Ratio Leverage Ratio as of Mar-8 : 4.8%. Calculated by Mizuho based on fully-effective Basel III Rule as of March 09, deducting total amount of regulatory adjustments. CET available after meeting the bank's minimum capital requirements Mar-7 Mar-8 Total of bank CET specific buffer requirements.75%.635% o/w Capital Conservation Buffer.5%.875% Countercyclical Capital Buffer 0% 0.0% G-SIBs Capital Buffer 0.5% 0.75% 8

10 Earnings Plan for FY08 Earnings Plan for FY08 and Cash Dividends Consolidated Consolidated Net Business Profits +Net Gains related to ETFs and others FY08 (Plan) Changes from FY FY08 Net Income Attributable to FG is estimated to be JPY 570.0bn, approximately the same level as that of FY07 Credit-related Costs Net Gains (Losses) related to Stocks -Net Gains related to ETFs and others Ordinary Profits Net Income Attributable to FG Consolidated Gross Profits - G&A Expenses (excluding Non-Recurring Losses) + Equity in Income from Investments in Affiliates and certain other consolidation adjustments. Profit Attributable to Owners of Parent Banks Annual Cash Dividend per Share of Common Stock for FY08 is estimated to be JPY 7.5 (unchanged from FY07) Continue the steady dividend payout policy with a dividend payout ratio on a consolidated basis of approx. 30% as a guide for our consideration Cash Dividend per Share of Common Stock Net Business Profits +Net Gains related to ETFs Credit-related Costs Net Gains (Losses) related to Stocks +Net Gains related to ETFs Ordinary Profits Net Income FY08 (Plan) Changes from FY FY 08 FY05 FY06 FY07 Changes from FY07 Annual Cash Dividends (Estimate) JPY 7.5 unchanged Transition of Cash Dividends FY08 (Estimate) Annual Cash Dividends JPY 7.5 JPY 7.5 JPY 7.5 JPY 7.5 (Dividend payout ratio) (7.8%) (3.4%) (33.0%) (33.3%) 9

11 Reference: Mizuho Securities Net Income Attributable to SC SC Consolidated Retail Related Results Net Inflow of Client Assets Sales of Equity Investment Trusts (rounded figures) (rounded figures) Q FY6 Q FY7 Q FY7 3Q FY7 4Q FY7. Quarterly Profit Attributable to Owners of Parent Overview of Net Operating Revenues FY6 Reference FY6 (Incl. MSUSA excl. Shinko) FY7 Changes Commissions Net gain on trading from FY6 SC Consolidated Reference FY7 (Incl. MSUSA excl. Shinko) 4Q FY6 Q FY7 Q FY7 3Q FY7 4Q FY7 League Tables 4Q FY6 Q FY7 Q FY7 3Q FY7 4Q FY7. Domestic sales (including privately placed investment trusts, but excluding reinvested dividends) M&A Adv isory f or Announced Deals nd 8 Deals Apr., 07 Mar. 3, 08 6 Deals Total Equity Underwriting Worldwide 4 th.7% Market Share Total Japan Publicly Of f ered Bonds 7 nd 8.9% Market Share ABS Lead Manager 8 st 33.0% Market Share 9 Americas DCM 0 th 3.6% Market Share Net gain (loss) on operating investment securities Net financial Income Net Operating Revenues Simple deduction of Shinko Asset Management (Shinko) (H FY6) from SC Consolidated (FY6) and a simple aggregate of Mizuho SC USA (MSUSA) (Q-4Q FY6) 4. Simple aggregate of SC Consolidated (FY7) and Mizuho SC USA (MSUSA) (FY7) 5. Number of deals basis. Any Japanese involvement, excluding real estate deals. Source: Thomson Reuters 6. Underwriting amount basis, pricing date basis. Deals including initial public offering, public offering and convertible bonds, including REITs. Source: Thomson Reuters 7. Underwriting amount basis, pricing date basis. Deals including straight bonds, investment corporation bonds, Zaito agency bonds, municipal bonds (lead manager method only), Samurai bonds and preferred securities, and excluding self-led bonds. Source: I-N Information Systems 8. Transaction amount basis, settlement date basis. Source: Thomson Reuters 9. Bonds with issuance amount of USD 50mm and above issued by investment grade corporations in the Americas. Source: Dealogic 0

12 Reference: Progress of the Medium-term Business Plan Financial Targets for FY08 Progress Against the Major Financial Targets FY7 Results CET Capital Ratio Approx.0% 0.5% CET Capital Ratio (excluding Net Unrealized Gains on Other Securities) 9.7% 0.5% Approx. 0%,96.9 Cross-shareholding Disposal -JPY 398.0bn,687.5,564.8 Reduction Amount: JPY 550bn Consolidated ROE Approx. 8% 7.7% RORA (Net Income Attributable to Owners of FG) Approx. 0.9% 0.9% Mar-7 Mar-8 Mar-9 Proportion of Non-interest Income 5 Mar-5 Mar-7 Mar-8 Mar-9 Expense Ratio 5 Group Expense Ratio 3 Cross-shareholdings Disposal Original Plan: Approx. 60% FY08 Plan: Higher 60% range JPY 550bn 4 Noninterest Income 54% 46% FY5 Net- Interest Income Noninterest Income 58% FY7 Net- Interest Income 4% FY8 Approx. 60% 75% 70% 65% 60% 55% 60.0% 7.% FY8 Plan Higher 60% range Original Plan Approx. 60% level FY5 FY7 FY8. Basel III fully-effective basis (based on current regulations), excluding Net Unrealized Gains on Other Securities. Excluding Net Unrealized Gains on Other Securities 3. Group aggregated 4. Shares listed on Japanese stock market, acquisition cost basis, cumulative amount from FY5 to FY8 5. The range of management account companies has been changed since Q FY7

13 This immediate release contains statements that constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 995, 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 forwardlooking 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 0-F filed with the U.S. Securities and Exchange Commission ( SEC ) and our report on Form 6-K furnished to the SEC on December 8, 07, both of which are available in the Financial Information section of our web page at and also at the SEC s web site at 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. MHFG is a specified business company under "Cabinet Office Ordinance on Disclosure of Corporate Information, etc." Article 7-5 clause and prepares the interim consolidated financial statements in the second quarter.