Aozora fy2011 3q_01

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Aozora fy2011 3q_01

  1. 1. Summary of the 3rd Quarter Financial Statementsfor the First Nine Months of FY2011 [JGAAP] (Consolidated) January 30, 2012 Listed Exchange TSECompany Name Aozora Bank, Ltd. URL http://www.aozorabank.co.jp/TSE Code 8304Representative Brian F. Prince, Representative Director and PresidentContact Person Ichiro Mizuno, Joint General Manager of Financial Control DivisionScheduled Filing Date of Securities Report February 10, 2012 Dividend payable date -Reference Material Yes Trading Accounts YesInvestor Meeting Yes TEL (03)3263-1111 (Unit: JPY millions, rounded down)1. Business highlights for the first nine months of FY2011(1) Consolidated business results (Note: Percentages show year-on-year rates of change) Ordinary income Ordinary profit Net incomeNine months ended Million Yen % Million Yen % Million Yen % Dec. 31, 2011 92,363 (7.3) 29,517 50.3 31,682 60.8 Dec. 31, 2010 99,591 (4.9) 19,633 160.4 19,700 169.6(Note)Comprehensive income JPY 33,543 million (+74.8%) (Nine months ended Dec. 31, 2011) JPY 19,194 million (Nine months ended Dec. 31, 2010) Net income per Net income per common share (basic) common share (diluted)Nine months ended Yen Yen Dec.31, 2011 21.20 16.16 Dec.31, 2010 13.18 10.05(2) Consolidated financial condition Net assets to Net assets Total net Total assets total assets per common assets ratio share Million Yen Million Yen % Yen Dec. 31, 2011 5,032,836 593,996 11.8 276.60 Mar. 31, 2011 4,918,370 565,184 11.5 256.27(Ref.) Total net assets less Minority interests JPY 593,266 million (Dec. 31, 2011) JPY 564,457 million (Mar. 31, 2011)(Note) Net assets to total assets ratio = Total net assets less (Subscription rights to shares and Minority interests) / Total assets2. Dividend Annual dividend 1Q end 2Q end 3Q end Year-end Annual Yen Yen Yen Yen YenFY2010(common stock) - - - 2.00 2.00FY2011(common stock) - - -FY2011(common stock) 9.00 9.00 (Forecast)(Note) Revision of dividends forecast to the latest announcement None(Note) Please refer to “(Ref.1) Dividends of preferred stocks” on page 2 for preferred stocks.3. Consolidated earnings forecast for the year ending March 31, 2012 (FY 2011) (Note: Percentages show year-on-year rates of change) Net income Ordinary income Ordinary profit Net income per share Million Yen % Million Yen % Million Yen % Yen FY2011(Full Year) 125,000 (1.3) 40,000 39.4 45,000 37.2 28.62 (Note) Revision of consolidated earnings forecast to the latest announcement None 1
  2. 2. Aozora Bank, Ltd.4. Other(1) Changes in material subsidiaries during the first nine months (changes in specified subsidiaries which affect the scope of consolidation) None(2) Accounting treatments particularly used for the quarterly financial statements None(3) Changes in accounting policy, accounting estimates, or retrospective restatements (a) Changes with amendment of accounting principles None (b) Changes other than (a) above None (c) Changes in accounting estimates None (d) Retrospective restatements None(4) The number of common stock issued (Unit:shares) (a) The number of common stock Dec. 31, 2011 1,650,147,352 Mar. 31, 2011 1,650,147,352 issued ( including treasury stock ) (b) The number of treasury stock Dec. 31, 2011 153,728,171 Mar. 31, 2011 155,892,729 (c) The average number of common Dec. 31, 2011 1,494,340,862 Dec. 31 2010 1,494,254,819 stock outstanding ( 9 months )※Implementation process of quarterly review This quarterly summary is out of scope of quarterly review stipulated by Financial Instruments and Exchange Act. The quarterly review on the quarterly financial statements is in process at the timing of the disclosure of this quarterly summary.※Notes and remarks for the proper use of earnings projection The above earnings forecast contains risks and uncertainties since the calculations are based on management’s assumptions and beliefs in light of information currently available. Please be aware that actual results may be materially different from the forecast presented herein due to various factors.(Ref.1) Dividends of preferred stocks Annual dividend 1Q end 2Q end 3Q end Year-end Annual Yen Yen Yen Yen Yen FY2010 4th Preferred - - - 10 00 10 00 5th Preferred - - - 7 44 7 44 FY2011 4th Preferred - - - 5th Preferred - - - FY2011 4th Preferred 10 00 10 00 (Forecast) 5th Preferred 7 44 7 44(Ref.2) Non-consolidated earnings forecast for the year ending March 31, 2012 (FY 2011) (Note: Percentages show year-on-year rates of change) Net income Ordinary income Ordinary profit Net income per share Million Yen % Million Yen % Million Yen % Yen FY2011(Full Year) 120,000 (3.4) 39,500 41.0 45,000 41.4 28.62(Note) Revision of non-consolidated earnings forecast to the latest announcement None 2
  3. 3. Aozora Bank, Ltd. [ Attachment ]1. Qualitative information (1) Consolidated results of operations ・・・・・・・・・・・・・・・ 2 (2) Consolidated financial condition ・・・・・・・・・・・・・・・ 3 (3) Consolidated earnings forecast ・・・・・・・・・・・・・・・ 32. Information about items stated on ‘4. Other’ on page 2 (1) Changes in material subsidiaries during the first nine months ・・・・・・・・ 3 (2) Accounting treatments particularly used for the quarterly financial statements ・・・・・・・・・・・・・・・ 3 (3) Changes in accounting policy, accounting estimates, or retrospective restatements ・・・・・・・・・・・・・・・ 3 (Reference) Summary of consolidated revenue and expenses ・・・・・・・・・・・ 43. Quarterly consolidated financial statements (1) Quarterly consolidated balance sheets ・・・・・・・・・・・・・・・ 5 (2) Quarterly consolidated statements of income and Quarterly consolidated statements of comprehensive income ・・・・・・・・・・・・・・・ 7 (3) Information on going concern assumption ・・・・・・・・・・・・・・・ 9 (4) Changes in shareholders equity ・・・・・・・・・・・・・・・ 94.(Reference)Quarterly non-consolidated financial statements (1) Quarterly non-consolidated balance sheets ・・・・・・・・・・・・・・・10 (2) Quarterly non-consolidated statements of income・・・・・・・・・・・・・・12 1
  4. 4. Aozora Bank, Ltd.1. Qualitative information(1) Consolidated results of operations Aozora reported consolidated net revenue of 59.5 billion yen and net income of 31.7 billion yen for the first nine months. These results represented progress of 73.4% and 70.4%, respectively, towards the full-year forecasts, revised upward last October, of 81.0 billion yen and 45.0 billion yen. Net interest income was 34.2 billion yen, representing a slight increase year on year. The net interest margin continued to improve while the average balance of interest earning assets declined year on year as the Bank continued its disciplined balance sheet management. Funding costs were reduced 19 bps to 0.60 %, from 0.79 %, in the first nine months of FY2011, reflecting our ongoing efforts to reduce funding costs while maintaining a stable base of retail deposits. As a result of the reduction in funding costs, the net interest margin expanded 10 bps to 1.05% year on year. Net fees and commissions were 6.3 billion yen, a decrease of 1.1 billion yen or 15.3%, year on year. The sale of investment products to our mass affluent retail customers showed steady progress. Net trading revenues were 5.3 billion yen, a decrease of 2.1 billion yen or 27.8% year on year. Earnings from sales of derivative-embedded products decreased, mainly due to changes in the market environment. Gains/losses on bond transactions decreased 1.1 billion yen, or 10.3%, to 9.9 billion yen. Net other ordinary income, excluding gains/losses on bond transactions, improved 3.2 billion yen to 3.8 billion yen, mainly due to profit from limited partnerships and gains from overseas investments. As a result of the above factors, consolidated net revenue was 59.5 billion yen, a decrease of 1.1 billion yen year on year. General and administrative expenses were reduced 1.4 billion yen, or 4.6%, year on year, to 28.8 billion yen, as a result of our continued strict control on costs, including the implementation of a Bank-wide cost review, which led to broad savings in personnel cost, technology cost and other operating expense categories. The overhead ratio, or OHR, (general and administrative expenses as a percentage of net revenue) was 48.4%, well within the Banks mid-term target of 50% or below. Credit-related expenses were a net profit of 2.0 billion yen, compared with a net expense of 9.4 billion yen in the first nine months of FY2010. While the Bank conservatively strengthened its specific reserves mainly for existing overseas credit, a reversal of the loan loss reserve, reflecting both the absence of significant credit events and preventative measures taken by the Bank to date including the conservative allocation of reserves, resulted in a net profit. The ratio of loan loss reserves to total loans outstanding was 3.42% as of December 31, 2011 and remained one of the highest among major Japanese banks. Ordinary profit increased by 9.9 billion yen to 29.5 billion yen. Extraordinary profit was 0.1 billion yen, a decrease of 0.3 billion yen year on year. As a result, income before income taxes and minority interests increased by 9.6 billion yen year on year to 29.6 billion yen. Total income taxes (a sum of corporation tax, resident tax, business tax and deferred income taxes) were a gain of 2.1 billion yen as a result the calculation of deferred tax assets, in consideration of the earnings projection and the negative effect on deferred tax assets of approximately 2.5 billion yen resulting from the recent revision of the corporate tax rate for the next fiscal year. As a result of the above factors, consolidated net income for the first nine months increased by 12.0 billion yen to 31.7 billion yen. Net income per common share (basic) was 21.20 yen. Comprehensive income for the first nine months of FY2011 resulted in a gain of 33.5 billion yen, a year on year increase of 14.3 billion yen. 2
  5. 5. Aozora Bank, Ltd.(2) Consolidated financial condition Total assets were 5,032.8 billion yen as of December 31, 2011, an increase of 114.5 billion yen, or 2.3%, compared to March 31, 2011. Loans decreased slightly from March 31, 2011 by 62.9 billion yen, or 2.3%, to 2,666.7 billion yen, reflecting a decrease of 87.3 billion yen, or 20.6%, in overseas loans, while domestic lending increased 24.4 billion yen, or 1.1%. Securities decreased by 131.0 billion yen, or 9.8%, to 1,204.7 billion yen. On the funding side, total deposits and negotiable certificates of deposit increased 15.7 billion yen, or 0.5 %, as compared to March 31, 2011, and bonds payable decreased 91.2 billion yen due to redemptions. We continued our effort to reduce funding costs while maintaining a stable base of retail deposits. As a result, funding from retail customers was 2,174.4 billion yen, while the percentage of retail funding to total core funding remained high at 68.1%. Total liabilities increased 85.7 billion yen, or 2.0%, to 4,438.8 billion yen as compared to March 31, 2011. Net assets were 594.0 billion yen, representing an increase of 28.8 billion yen, or 5.1%, in comparison with March 31, 2011. Net assets per common share were 276.60 yen, as compared to 256.27 yen per common share as of March 31, 2011.(3) Consolidated earnings forecast No change has been made to the full-year consolidated earnings forecast of FY2011 announced on October 31, 2011 (net revenue of 81.0 billion yen, business profit of 41.5 billion, yen ordinary profit of 40.0 billion yen and net income of 45.0 billion yen). (Note) Figures stated in 0.1 billion yen units are rounded to the nearest 0.1 billion yen.2. Information about items stated on ‘4. Other’ on page 2(1) Changes in material subsidiaries during the first nine months None(2) Accounting treatments particularly used for the quarterly financial statements None(3) Changes in accounting policy, accounting estimates, or retrospective restatements None 3
  6. 6. Aozora Bank, Ltd. (Reference) Summary of consolidated revenue and expenses (JPY 100 million) FY2010 FY2011 Change 9 months 9 months Apr.-Dec. Apr.-Dec. Net revenue ※1 606 595 -11 Net interest income 342 342 0 Net fees and commissions 74 63 -11 Net trading revenues 74 53 -21 Gains/losses on bond transactions 110 99 -11 Net other ordinary income excluding 6 38 32 gains/losses on bond transactions General and administrative expenses -302 -288 14 Business profit ※2 304 307 2 Credit-related expenses ① -108 20 128 Gains/losses on stock transactions -3 2 5 Other 3 -33 -37 Ordinary profit 196 295 99 Extraordinary profit 4 1 -3 Credit-related expenses (recoveries of 14 - -14 written-off claims, etc.) ② Other extraordinary profit -10 1 11 Income before income taxes and minority 200 296 96 interests Total income taxes -2 21 23 Minority interest in net income -1 -0 0 Net income 197 317 120 Credit-related expenses (including recoveries of written-off claims) -94 20 114 (①+②) Comprehensive income 192 335 143※1 Net revenue = ( Interest income - Interest expenses ) + ( Fees and commissions income - Fees and commissions expenses)+(Trading income-Trading expenses)+(Other ordinary income-Other ordinary expenses)※2 Business profit = Net revenue-General and administrative expenses※3 Regardless of nature of accounts, income is shown as positive and expenses or losses are shown as negative amount. 4
  7. 7. Aozora Bank, Ltd.3. 【Quarterly consolidated financial statements】(1) 【Quarterly consolidated balance sheets】 (millions of yen) As of Mar. 31, 2011 As of Dec. 31, 2011 Assets Cash and due from banks 271,963 244,129 Call loans and bills bought 20,000 80,000 Receivables under securities borrowing transactions 33,071 96,998 Monetary claims bought 61,586 49,385 Trading assets 348,614 583,137 Money held in trust 6,994 6,201 Securities 1,335,677 1,204,710 Loans and bills discounted 2,729,569 2,666,710 Foreign exchanges 46,293 29,232 Other assets 81,512 67,933 Tangible fixed assets 23,296 22,281 Intangible fixed assets 5,757 4,469 Deferred debenture discounts 58 36 Deferred tax assets 45,559 45,861 Customers liabilities for acceptances and guarantees 14,777 28,249 Allowance for loan losses (100,228) (91,119) Allowance for investment loss (6,134) (5,381) Total assets 4,918,370 5,032,836 Liabilities Deposits 2,777,397 2,739,403 Negotiable certificates of deposit 154,940 208,644 Debentures 264,741 244,306 Call money and bills sold 131,787 92,719 Payables under securities lending transactions 221,571 387,087 Trading liabilities 249,597 306,477 Borrowed money 265,600 172,429 Foreign exchanges 1 1 Bonds payable 91,199 - Other liabilities 165,261 245,508 Provision for bonuses 2,274 1,477 Provision for retirement benefits 12,979 11,317 Provision for directors retirement benefits 273 371 Reserve for credit losses on off-balance-sheet instruments 775 845 Reserves under the special laws - 2 Deferred tax liabilities 6 - Acceptances and guarantees 14,777 28,249Total liabilities 4,353,185 4,438,840 5
  8. 8. Aozora Bank, Ltd. (millions of yen) As of Mar. 31, 2011 As of Dec. 31, 2011 Net assets Capital stock 419,781 419,781 Capital surplus 33,333 33,575 Retained earnings 132,420 158,949 Treasury stock (15,650) (15,433) Total shareholders equity 569,884 596,872 Valuation difference on available-for-sale securities 1,795 4,621 Deferred gains or losses on hedges 2,112 1,611 Foreign currency translation adjustment (9,334) (9,838) Total accumulated other comprehensive income (5,426) (3,605) Minority interests 727 729 Total net assets 565,184 593,996 Total liabilities and net assets 4,918,370 5,032,836(Note) All figures are rounded down to the nearest million yen. The totals do not necessarily equal the sum of the individual amounts. 6
  9. 9. Aozora Bank, Ltd.(2) 【Quarterly consolidated statements of income and Quarterly consolidated statements of comprehensive income】【Quarterly consolidated statements of income 】【For the nine months ended Dec. 31】 (millions of yen) For the nine months For the nine months ended Dec. 31, 2010 ended Dec. 31, 2011 Ordinary income 99,591 92,363 Interest income 57,923 51,665 Interest on loans and discounts 43,576 38,719 Interest and dividends on securities 10,125 9,684 Fees and commissions 8,079 6,833 Trading income 7,389 5,332 Other ordinary income 23,727 22,172 Other income 2,471 6,358 Ordinary expenses 79,957 62,846 Interest expenses 23,772 17,477 Interest on deposits 17,224 13,384 Interest on debentures 3,449 2,036 Fees and commissions payments 632 527 Other ordinary expenses 12,096 8,525 General and administrative expenses 30,196 29,757 Other expenses 13,259 6,558 Ordinary profit 19,633 29,517 Extraordinary income 1,381 134 Gain on disposal of noncurrent assets 0 - Gain on negative goodwill - 134 Recoveries of written-off claims 523 Reversal of reserve for credit losses on off-balance-sheet instruments 858 Extraordinary loss 1,007 40 Loss on disposal of noncurrent assets 78 40 Impairment loss 1 - Loss on adjustment for changes of accounting standard for asset retirement 718 obligations Environmental expenses 208 - Income before income taxes and minority interests 20,008 29,612 Income taxes-current 307 258 Income taxes-deferred (73) (2,368) Total income taxes 233 (2,109) Income before minority interests 19,774 31,721 Minority interests in income 74 38 Net income 19,700 31,682(Note) All figures are rounded down to the nearest million yen. The totals do not necessarily equal the sum of the individual amounts. 7
  10. 10. Aozora Bank, Ltd.【Quarterly consolidated statements of comprehensive income】【For the nine months ended Dec. 31】 (millions of yen) For the nine months For the nine months ended Dec. 31, 2010 ended Dec. 31, 2011 Income before minority interests 19,774 31,721 Other comprehensive income (580) 1,821 Valuation difference on available-for-sale securities 1,207 2,826 Deferred gains or losses on hedges (508) (500) Foreign currency translation adjustment (1,279) (504) Comprehensive income 19,194 33,543 Comprehensive income attributable to owners of the parent 19,119 33,504 Comprehensive income attributable to minority interests 74 38(Note) All figures are rounded down to the nearest million yen. The totals do not necessarily equal the sum of the individual amounts. 8
  11. 11. Aozora Bank, Ltd.(3) Information on going concern assumption None(4) Changes in shareholders equity None 9
  12. 12. Aozora Bank, Ltd.4. (Reference) Quarterly non-consolidated financial statements (1) Quarterly non-consolidated balance sheets (millions of yen) As of Mar. 31, 2011 As of Dec. 31, 2011Assets Cash and due from banks 263,354 235,993 Call loans 20,000 80,000 Receivables under securities borrowing transactions 33,071 96,998 Monetary claims bought 34,341 24,107 Trading assets 347,108 581,925 Money held in trust 5,579 2,774 Securities 1,378,138 1,243,100 Loans and bills discounted 2,738,610 2,675,152 Foreign exchanges 46,293 29,232 Other assets 81,065 66,592 Tangible fixed assets 23,236 22,171 Intangible fixed assets 6,056 4,621 Deferred debenture discounts 58 36 Deferred tax assets 44,701 45,161 Customers liabilities for acceptances and guarantees 14,553 28,198 Allowance for loan losses (98,772) (90,536) Allowance for investment loss (8,762) (7,548) Total assets 4,928,632 5,037,981Liabilities Deposits 2,787,919 2,746,971 Negotiable certificates of deposit 154,940 208,644 Debentures 264,741 244,306 Call money 131,787 92,719 Payables under securities lending transactions 221,571 387,087 Trading liabilities 249,597 306,477 Borrowed money 265,600 171,500 Foreign exchanges 1 1 Bonds payable 91,199 - Other liabilities 164,871 244,187 Income taxes payable 356 205 Lease obligations 956 634 Asset retirement obligations 1,492 1,514 Other 162,066 241,833 Provision for bonuses 2,226 1,428 Provision for retirement benefits 12,948 11,231 Provision for directors retirement benefits 253 358 Reserve for credit losses on off-balance-sheet 1,131 1,199 instruments Acceptances and guarantees 14,553 28,198 Total liabilities 4,363,343 4,444,311 10
  13. 13. Aozora Bank, Ltd. (millions of yen) As of Mar. 31, 2011 As of Dec. 31, 2011Net assets Capital stock 419,781 419,781 Capital surplus 33,333 33,575 Legal capital surplus 33,333 33,333 Other capital surplus - 241 Retained earnings 123,899 149,447 Legal retained earnings 8,529 9,560 Other retained earnings 115,370 139,887 Retained earnings brought forward 115,370 139,887 Treasury stock (15,650) (15,433) Total shareholders equity 561,363 587,370 Valuation difference on available-for-sale securities 1,813 4,688 Deferred gains or losses on hedges 2,112 1,611 Total valuation and translation adjustments 3,925 6,299 Total net assets 565,289 593,670Total liabilities and net assets 4,928,632 5,037,981(Note) 1 Quarterly non-consolidated balance sheets are prepared pursuant to “Accounting Standards for Quarterly Financial Statements”. They are not subject to review under legal disclosure. 2 All figures are rounded down to the nearest million yen. The totals do not necessarily equal the sum of the individual amounts. 11
  14. 14. Aozora Bank, Ltd.(2) Quarterly non-consolidatedstatements of income 【For the nine months ended Dec.31】 (millions of yen) For the nine months For the nine months ended Dec.31,2010 ended Dec.31,201 1Ordinary income 96,691 87,501 Interest income 57,187 51,149 Interest on loans and discounts 42,987 38,293 Interest and dividends on securities 9,996 9,611 Fees and commissions 7,819 6,680 Trading income 7,050 4,734 Other ordinary income 22,528 19,310 Other income 2,105 5,626Ordinary expenses 76,416 59,236 Interest expenses 23,773 17,477 Interest on deposits 17,225 13,384 Interest on debentures 3,449 2,036 Fees and commissions payments 692 581 Other ordinary expenses 13,226 8,615 General and administrative expenses 28,445 28,139 Other expenses 10,279 4,422Ordinary profit 20,274 28,265Extraordinary income 1,331 - Recoveries of written-off claims 538 Reversal of reserve for credit losses on off-balance-sheet instruments 792Extraordinary loss 990 40 Loss on disposal of noncurrent assets 78 40 Loss on adjustment for changes of accounting standard for asset 702 retirement obligations Environmental expenses 208 -Income before income taxes 20,616 28,224Income taxes-current 36 (0)Income taxes-deferred 105 (2,477)Total income taxes 141 (2,477)Net income 20,474 30,702(Note) 1 Quarterly non-consolidated statements of income are prepared pursuant to “Accounting Standards for Quarterly Financial Statements”. They are not subject to review under legal disclosure. 2 All figures are rounded down to the nearest million yen. The totals do not necessarily equal the sum of the individual amounts. 12

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