0001335730 us-gaap:SecuritiesSoldNotYetPurchasedMember 2019-04-01 2020-03-31
☐ | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☒ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
2020
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
☐ | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Masahiro Kosugi,
Title of each class | Trading Symbols | Name of each exchange on which registered | ||
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American depositary shares, each of which represents two shares of common stock | MFG | The New York Stock Exchange | ||
Common Stock, without par value* |
Large accelerated filer ☒ | Accelerated filer ☐ | Non-accelerated filer ☐ | Emerging growth company ☐ |
† | The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. |
U.S. GAAP ☒ | International Financial Reporting Standards as issued by the International Accounting Standards Board ☐ | Other ☐ |
☐
* | Not for trading, but only in connection with the registration and listing of the ADSs. |
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ITEM 1. | 5 | ||||||||||
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ITEM 3. | 6 | ||||||||||
3.A. | 6 | ||||||||||
3.B. | 10 | ||||||||||
3.C. | 10 | ||||||||||
3.D. | 10 | ||||||||||
ITEM 4. | 24 | ||||||||||
4.A. | 24 | ||||||||||
4.B. | 26 | ||||||||||
4.C. | 55 | ||||||||||
4.D. | 57 | ||||||||||
ITEM 4A. | 57 | ||||||||||
ITEM 5. | 58 | ||||||||||
ITEM 6. | 105 | ||||||||||
6.A. | 105 | ||||||||||
6.B. | 109 | ||||||||||
6.C. | 114 | ||||||||||
6.D. | 119 | ||||||||||
6.E. | 121 | ||||||||||
ITEM 7. | 123 | ||||||||||
7.A. | 123 | ||||||||||
7.B. | 123 | ||||||||||
7.C. | 123 | ||||||||||
ITEM 8. | 124 | ||||||||||
8.A. | 124 | ||||||||||
8.B. | 124 | ||||||||||
ITEM 9. | 125 | ||||||||||
9.A. | 125 | ||||||||||
9.B. | 125 | ||||||||||
9.C. | 125 | ||||||||||
9.D. | 125 | ||||||||||
9.E. | 125 | ||||||||||
9.F. | 125 | ||||||||||
ITEM 10. | 125 | ||||||||||
10.A. | 125 | ||||||||||
10.B. | 125 | ||||||||||
10.C. | 138 | ||||||||||
10.D. | 138 | ||||||||||
10.E. | 142 | ||||||||||
10.F. | 148 | ||||||||||
10.G. | 148 | ||||||||||
10.H. | 148 | ||||||||||
10.I. | 149 |
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ITEM 11. | 150 | |||||||||||||
ITEM 12. | 169 | |||||||||||||
12.A. | 169 | |||||||||||||
12.B. | 169 | |||||||||||||
12.C. | 169 | |||||||||||||
12.D. | 169 | |||||||||||||
ITEM 13. | 170 | |||||||||||||
ITEM 14. | 170 | |||||||||||||
ITEM 15. | 170 | |||||||||||||
ITEM 16A. | 171 | |||||||||||||
ITEM 16B. | 171 | |||||||||||||
ITEM 16C. | 171 | |||||||||||||
ITEM 16D. | 172 | |||||||||||||
ITEM 16E. | 173 | |||||||||||||
ITEM 16F. | 173 | |||||||||||||
ITEM 16G. | 173 | |||||||||||||
ITEM 16H. | 175 | |||||||||||||
ITEM 17. | 176 | |||||||||||||
ITEM 18. | 176 | |||||||||||||
ITEM 19. | 176 | |||||||||||||
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F- 1 |
statements by discussions of strategy, plans or intentions. These statements reflect our current views with respect
ITEM 1. | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE |
ITEM 3. | KEY INFORMATION |
2014, 2015, 2016, 2017, 2018, 2019 and 20182020 derived from the audited consolidated financial statements of Mizuho Financial Group prepared in accordance with U.S. GAAP.2014, 2015, 2016, 2017, 2018, 2019 and 20182020 derived from Mizuho Financial Group’s consolidated financial statements prepared in accordance with accounting principles generally accepted in Japan, or Japanese GAAP.20182020 prepared in accordance with U.S. GAAP have been audited in accordance with the standards of the Public Company Accounting Oversight Board (United States) by Ernst & Young ShinNihon LLC, an independent registered public accounting firm.
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in millions of yen, except per share data, share number information and percentages) | ||||||||||||||||||||
Statement of income data: | ||||||||||||||||||||
Interest and dividend income | ¥ | 1,422,799 | ¥ | 1,457,659 | ¥ | 1,500,171 | ¥ | 1,509,030 | ¥ | 1,761,886 | ||||||||||
Interest expense | 401,565 | 411,982 | 495,407 | 601,712 | 889,936 | |||||||||||||||
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Net interest income | 1,021,234 | 1,045,677 | 1,004,764 | 907,318 | 871,950 | |||||||||||||||
Provision (credit) for loan losses | (126,230 | ) | (60,223 | ) | 34,560 | 37,668 | (126,362 | ) | ||||||||||||
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Net interest income after provision (credit) for loan losses | 1,147,464 | 1,105,900 | 970,204 | 869,650 | 998,312 | |||||||||||||||
Noninterest income | 1,082,834 | 1,801,215 | 1,883,894 | 1,368,032 | 1,604,663 | |||||||||||||||
Noninterest expenses | 1,503,955 | 1,639,462 | 1,657,493 | 1,757,307 | 1,763,677 | |||||||||||||||
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Income before income tax expense | 726,343 | 1,267,653 | 1,196,605 | 480,375 | 839,298 | |||||||||||||||
Income tax expense | 226,108 | 437,420 | 346,542 | 91,244 | 237,604 | |||||||||||||||
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Net income | 500,235 | 830,233 | 850,063 | 389,131 | 601,694 | |||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | 1,751 | 27,185 | (429 | ) | 26,691 | 24,086 | ||||||||||||||
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Net income attributable to MHFG shareholders | ¥ | 498,484 | ¥ | 803,048 | ¥ | 850,492 | ¥ | 362,440 | ¥ | 577,608 | ||||||||||
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Net income attributable to common shareholders | ¥ | 491,739 | ¥ | 798,138 | ¥ | 848,062 | ¥ | 362,440 | ¥ | 577,608 | ||||||||||
Amounts per share: | ||||||||||||||||||||
Basic earnings per common share—net income attributable to common shareholders | ¥ | 20.33 | ¥ | 32.75 | ¥ | 34.19 | ¥ | 14.33 | ¥ | 22.77 | ||||||||||
Diluted earnings per common share—net income attributable to common shareholders | ¥ | 19.64 | ¥ | 31.64 | ¥ | 33.50 | ¥ | 14.28 | ¥ | 22.76 | ||||||||||
Number of shares used to calculate basic earnings per common share (in thousands) | 24,189,670 | 24,368,116 | 24,806,161 | 25,285,899 | 25,366,345 | |||||||||||||||
Number of shares used to calculate diluted earnings per common share (in thousands) | 25,371,252 | 25,381,047 | 25,387,033 | 25,380,302 | 25,373,931 | |||||||||||||||
Cash dividends per share (1)(2): | ||||||||||||||||||||
Common stock | ¥ | 6.50 | ¥ | 7.50 | ¥ | 7.50 | ¥ | 7.50 | ¥ | 7.50 | ||||||||||
$ | 0.06 | $ | 0.06 | $ | 0.07 | $ | 0.07 | $ | 0.07 | |||||||||||
Eleventh series class XI preferred stock(3) | ¥ | 20.00 | ¥ | 20.00 | ¥ | 20.00 | ¥ | — | ¥ | — | ||||||||||
$ | 0.19 | $ | 0.17 | $ | 0.18 | $ | — | $ | — |
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in millions of yen, except per share data, share number information and percentages) | ||||||||||||||||||||
Statement of income data: | ||||||||||||||||||||
Interest and dividend income | ¥ | 1,500,171 | ¥ | 1,509,030 | ¥ | 1,761,886 | ¥ | 2,207,443 | ¥ | 2,151,172 | ||||||||||
Interest expense | 495,407 | 601,712 | 889,936 | 1,313,476 | 1,271,381 | |||||||||||||||
Net interest income | 1,004,764 | 907,318 | 871,950 | 893,967 | 879,791 | |||||||||||||||
Provision (credit) for loan losses | 34,560 | 37,668 | (126,362 | ) | 32,459 | 156,200 | ||||||||||||||
Net interest income after provision (credit) for loan losses | 970,204 | 869,650 | 998,312 | 861,508 | 723,591 | |||||||||||||||
Noninterest income | 1,883,894 | 1,368,032 | 1,604,663 | 1,222,371 | 1,307,740 | |||||||||||||||
Noninterest expenses | 1,657,493 | 1,757,307 | 1,763,677 | 1,998,819 | 1,877,841 | |||||||||||||||
Income before income tax expense | 1,196,605 | 480,375 | 839,298 | 85,060 | 153,490 | |||||||||||||||
Income tax expense | 346,542 | 91,244 | 237,604 | 9,335 | 47,175 | |||||||||||||||
Net income | 850,063 | 389,131 | 601,694 | 75,725 | 106,315 | |||||||||||||||
Less: Net income (loss) attributable to noncontrolling interests | (429 | ) | 26,691 | 24,086 | (8,746 | ) | (43,880 | ) | ||||||||||||
Net income attributable to MHFG shareholders | ¥ | 850,492 | ¥ | 362,440 | ¥ | 577,608 | ¥ | 84,471 | ¥ | 150,195 | ||||||||||
Net income attributable to common shareholders | ¥ | 848,062 | ¥ | 362,440 | ¥ | 577,608 | ¥ | 84,471 | ¥ | 150,195 | ||||||||||
Amounts per share: | ||||||||||||||||||||
Basic earnings per common share—net income attributable to common shareholders | ¥ | 34.19 | ¥ | 14.33 | ¥ | 22.77 | ¥ | 3.33 | ¥ | 5.92 | ||||||||||
Diluted earnings per common share—net income attributable to common shareholders | ¥ | 33.50 | ¥ | 14.28 | ¥ | 22.76 | ¥ | 3.33 | ¥ | 5.92 | ||||||||||
Number of shares used to calculate basic earnings per common share (in thousands) | 24,806,161 | 25,285,899 | 25,366,345 | 25,362,376 | 25,373,681 | |||||||||||||||
Number of shares used to calculate diluted earnings per common share (in thousands) | 25,387,033 | 25,380,302 | 25,373,931 | 25,366,898 | 25,375,264 | |||||||||||||||
Cash dividends per share (1)(2) : | ||||||||||||||||||||
Common stock | ¥ | 7.50 | ¥ | 7.50 | ¥ | 7.50 | ¥ | 7.50 | ¥ | 7.50 | ||||||||||
$ | 0.07 | $ | 0.07 | $ | 0.07 | $ | 0.07 | $ | 0.07 | |||||||||||
Eleventh series class XI preferred stock (3) | ¥ | 20.00 | ¥ | — | ¥ | — | ¥ | — | ¥ | — | ||||||||||
$ | 0.18 | $ | — | $ | — | $ | — | $ | — |
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in millions of yen, except per share data, share number information and percentages) | ||||||||||||||||||||
Balance sheet data: | ||||||||||||||||||||
Total assets | ¥ | 175,697,452 | (4) | ¥ | 190,114,354 | (4) | ¥ | 193,810,151 | (4) | ¥ | 200,456,304 | ¥ | 204,255,642 | |||||||
Loans, net of allowance | 72,858,777 | 77,528,017 | 77,104,122 | 81,804,233 | 83,204,742 | |||||||||||||||
Total liabilities | 169,076,081 | (4) | 181,924,510 | (4) | 185,626,960 | (4) | 191,684,247 | 194,751,942 | ||||||||||||
Deposits | 102,610,154 | 114,206,441 | 117,937,722 | 131,184,953 | 136,884,006 | |||||||||||||||
Long-term debt | 9,852,048 | (4) | 14,576,861 | (4) | 14,765,527 | (4) | 14,529,414 | 12,955,230 | ||||||||||||
Common stock | 5,489,295 | 5,590,396 | 5,703,144 | 5,826,149 | 5,826,383 | |||||||||||||||
Total MHFG shareholders’ equity | 6,378,470 | 7,930,338 | 8,014,551 | 8,261,357 | 8,868,421 | |||||||||||||||
Other financial data: | ||||||||||||||||||||
Return on equity and assets: | ||||||||||||||||||||
Net income attributable to common shareholders as a percentage of total average assets | 0.27 | % | 0.42 | % | 0.43 | % | 0.18 | % | 0.28 | % | ||||||||||
Net income attributable to common shareholders as a percentage of average MHFG shareholders’ equity | 9.64 | % | 13.86 | % | 13.33 | % | 5.25 | % | 8.26 | % | ||||||||||
Dividends per common share as a percentage of basic earnings per common share | 31.97 | % | 22.90 | % | 21.94 | % | 52.34 | % | 32.94 | % | ||||||||||
Average MHFG shareholders’ equity as a percentage of total average assets | 2.84 | % | 3.04 | % | 3.23 | % | 3.38 | % | 3.35 | % | ||||||||||
Net interest income as a percentage of total average interest-earning assets | 0.64 | % | 0.63 | % | 0.58 | % | 0.51 | % | 0.47 | % |
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in millions of yen, except per share data, share number information and percentages) | ||||||||||||||||||||
Balance sheet data: | ||||||||||||||||||||
Total assets | ¥ | 193,810,151 | (4) | ¥ | 200,456,304 | ¥ | 204,255,642 | ¥ | 197,611,195 | ¥ | 211,218,760 | |||||||||
Loans, net of allowance | 77,104,122 | 81,804,233 | 83,204,742 | 82,492,742 | 87,087,233 | |||||||||||||||
Total liabilities | 185,626,960 | (4) | 191,684,247 | 194,751,942 | 188,109,702 | 202,043,136 | ||||||||||||||
Deposits | 117,937,722 | 131,184,953 | 136,884,006 | 138,296,916 | 144,948,667 | |||||||||||||||
Long-term debt | 14,765,527 | (4) | 14,529,414 | 12,955,230 | 11,529,400 | 10,346,152 | ||||||||||||||
Common stock | 5,703,144 | 5,826,149 | 5,826,383 | 5,829,657 | 5,827,500 | |||||||||||||||
Total MHFG shareholders’ equity | 8,014,551 | 8,261,357 | 8,868,421 | 8,726,519 | 8,512,365 | |||||||||||||||
Other financial data: | ||||||||||||||||||||
Return on equity and assets: | ||||||||||||||||||||
Net income attributable to common shareholders as a percentage of total average assets | 0.43 | % | 0.18 | % | 0.28 | % | 0.04 | % | 0.07 | % | ||||||||||
Net income attributable to common shareholders as a percentage of average MHFG shareholders’ equity | 13.33 | % | 5.25 | % | 8.26 | % | 1.11 | % | 1.90 | % | ||||||||||
Dividends per common share as a percentage of basic earnings per common share | 21.94 | % | 52.34 | % | 32.94 | % | 225.23 | % | 126.69 | % | ||||||||||
Average MHFG shareholders’ equity as a percentage of total average assets | 3.23 | % | 3.38 | % | 3.35 | % | 3.71 | % | 3.91 | % | ||||||||||
Net interest income as a percentage of total average interest-earning assets | 0.58 | % | 0.51 | % | 0.47 | % | 0.48 | % | 0.48 | % |
(1) | Yen amounts are expressed in U.S. dollars at the rate of year-end dates in New York City for cable transfers in yen as certified for customs purposes by the Federal Reserve Bank of New York. |
(2) | Figures represent cash dividends per share with respect to the applicable fiscal year. Dividends with respect to a fiscal year include year-end dividends and interim dividends. Declaration and payment of dividends are conducted during the immediately following fiscal year, in the case ofyear-end dividends, or immediately following interim period, in the case of interim dividends. |
(3) | On July 1, 2016, we acquired ¥75.1 billion of eleventh series class XI preferred stock, in respect of which a request for acquisition was not made by June 30, 2016, and delivered shares of our common stock, pursuant to Article 20, Paragraph 1 of our articles of incorporation and a provision in the terms and conditions of the preferred stock concerning mandatory acquisition in exchange for common stock. On July 13, 2016, we cancelled all of our treasury shares of eleventh series class XI preferred stock. |
(4) | Total assets, total liabilities and long-term debt have been recalculated to reflect the retrospective adoption of ASU No.2015-03. |
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in millions of yen, except per share data and percentages) | ||||||||||||||||||||
Statement of income data: | ||||||||||||||||||||
Interest income | ¥ | 1,417,569 | ¥ | 1,468,976 | ¥ | 1,426,256 | ¥ | 1,445,555 | ¥ | 1,622,354 | ||||||||||
Interest expense | 309,266 | 339,543 | 422,574 | 577,737 | 814,988 | |||||||||||||||
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Net interest income | 1,108,303 | 1,129,433 | 1,003,682 | 867,818 | 807,366 | |||||||||||||||
Fiduciary income | 52,014 | 52,641 | 53,458 | 50,627 | 55,400 | |||||||||||||||
Net fee and commission | 560,768 | 593,360 | 607,551 | 603,542 | 614,349 | |||||||||||||||
Net trading income | 187,421 | 262,963 | 310,507 | 325,332 | 275,786 | |||||||||||||||
Net other operating income | 126,774 | 209,340 | 246,415 | 245,419 | 162,454 | |||||||||||||||
General and administrative expenses | 1,258,227 | 1,351,611 | 1,349,593 | 1,467,221 | 1,488,973 | |||||||||||||||
Other income | 344,275 | 301,652 | 365,036 | 438,042 | 565,683 | |||||||||||||||
Other expenses | 135,962 | 207,147 | 228,807 | 279,368 | 192,113 | |||||||||||||||
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Income before income taxes(1) | 985,366 | 990,632 | 1,008,252 | 784,193 | 799,953 | |||||||||||||||
Income taxes: | ||||||||||||||||||||
Current(2) | 137,010 | 260,268 | 213,289 | 196,535 | 190,158 | |||||||||||||||
Deferred | 77,960 | 44,723 | 69,260 | (58,800 | ) | 1,469 | ||||||||||||||
Profit(1) | 770,396 | 685,640 | 725,702 | 646,457 | 608,326 | |||||||||||||||
Profit attributable tonon-controlling interests(1) | 81,980 | 73,705 | 54,759 | 42,913 | 31,778 | |||||||||||||||
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Profit attributable to owners of parent(1) | ¥ | 688,415 | ¥ | 611,935 | ¥ | 670,943 | ¥ | 603,544 | ¥ | 576,547 | ||||||||||
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Net income per share: | ||||||||||||||||||||
Basic | ¥ | 28.18 | ¥ | 24.91 | ¥ | 26.94 | ¥ | 23.86 | ¥ | 22.72 | ||||||||||
Diluted | 27.12 | 24.10 | 26.42 | 23.78 | 22.72 | |||||||||||||||
Balance sheet data: | ||||||||||||||||||||
Total assets | ¥ | 175,822,885 | ¥ | 189,684,749 | ¥ | 193,458,580 | ¥ | 200,508,610 | ¥ | 205,028,300 | ||||||||||
Loans and bills discounted(3) | 69,301,405 | 73,415,170 | 73,708,884 | 78,337,793 | 79,421,473 | |||||||||||||||
Securities | 43,997,517 | 43,278,733 | 39,505,971 | 32,353,158 | 34,183,033 | |||||||||||||||
Deposits(4) | 101,811,282 | 113,452,451 | 117,456,604 | 130,676,494 | 136,463,824 | |||||||||||||||
Net assets | 8,304,549 | 9,800,538 | 9,353,244 | 9,273,361 | 9,821,246 | |||||||||||||||
Risk-adjusted capital data (Basel III)(5): | ||||||||||||||||||||
Common Equity Tier 1 capital | ¥ | 5,304,412 | ¥ | 6,153,141 | ¥ | 6,566,488 | ¥ | 7,001,664 | ¥ | 7,437,048 | ||||||||||
Tier 1 capital | 6,844,746 | 7,500,349 | 7,905,093 | 8,211,522 | 9,192,244 | |||||||||||||||
Total capital | 8,655,990 | 9,508,471 | 9,638,641 | 10,050,953 | 10,860,440 | |||||||||||||||
Risk-weighted assets | 60,274,087 | 65,191,951 | 62,531,174 | 61,717,158 | 59,528,983 | |||||||||||||||
Common Equity Tier 1 capital ratio | 8.80 | % | 9.43 | % | 10.50 | % | 11.34 | % | 12.49 | % | ||||||||||
Tier 1 capital ratio | 11.35 | 11.50 | 12.64 | 13.30 | 15.44 | |||||||||||||||
Total capital ratio | 14.36 | 14.58 | 15.41 | 16.28 | 18.24 |
As of and for the fiscal years ended March 31, | ||||||||||||||||||||
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in millions of yen, except per share data and percentages) | ||||||||||||||||||||
Statement of income data: | ||||||||||||||||||||
Interest income | ¥ | 1,426,256 | ¥ | 1,445,555 | ¥ | 1,622,354 | ¥ | 2,056,327 | ¥ | 2,014,440 | ||||||||||
Interest expense | 422,574 | 577,737 | 814,988 | 1,293,846 | 1,280,897 | |||||||||||||||
Net interest income | 1,003,682 | 867,818 | 807,366 | 762,480 | 733,542 | |||||||||||||||
Fiduciary income | 53,458 | 50,627 | 55,400 | 55,153 | 58,565 | |||||||||||||||
Net fee and commission income | 607,551 | 603,542 | 614,349 | 610,427 | 619,243 | |||||||||||||||
Net trading income | 310,507 | 325,332 | 275,786 | 297,367 | 391,299 | |||||||||||||||
Net other operating income | 246,415 | 245,419 | 162,454 | 87,306 | 259,567 | |||||||||||||||
General and administrative expenses | 1,349,593 | 1,467,221 | 1,488,973 | 1,430,850 | 1,378,398 | |||||||||||||||
Other income | 365,036 | 438,042 | 565,683 | 447,300 | 318,438 | |||||||||||||||
Other expenses | 228,807 | 279,368 | 192,113 | 712,927 | 383,542 | |||||||||||||||
Income before income taxes | 1,008,252 | 784,193 | 799,953 | 116,259 | 618,717 | |||||||||||||||
Income taxes: | ||||||||||||||||||||
Current (1) | 213,289 | 196,535 | 190,158 | 161,376 | 150,088 | |||||||||||||||
Deferred | 69,260 | (58,800 | ) | 1,469 | (163,879 | ) | 11,408 | |||||||||||||
Profit | 725,702 | 646,457 | 608,326 | 118,762 | 457,221 | |||||||||||||||
Profit attributable to non- controlling interests | 54,759 | 42,913 | 31,778 | 22,196 | 8,652 | |||||||||||||||
Profit attributable to owners of parent | ¥ | 670,943 | ¥ | 603,544 | ¥ | 576,547 | ¥ | 96,566 | ¥ | 448,568 | ||||||||||
Net income per share: | ||||||||||||||||||||
Basic | ¥ | 26.94 | ¥ | 23.86 | ¥ | 22.72 | ¥ | 3.80 | ¥ | 17.68 | ||||||||||
Diluted | 26.42 | 23.78 | 22.72 | 3.80 | 17.68 | |||||||||||||||
Balance sheet data: | ||||||||||||||||||||
Total assets | ¥ | 193,458,580 | ¥ | 200,508,610 | ¥ | 205,028,300 | ¥ | 200,792,226 | ¥ | 214,659,077 | ||||||||||
Loans and bills discounted (2) | 73,708,884 | 78,337,793 | 79,421,473 | 78,456,935 | 83,468,185 | |||||||||||||||
Securities | 39,505,971 | 32,353,158 | 34,183,033 | 29,774,489 | 34,907,234 | |||||||||||||||
Deposits (3) | 117,456,604 | 130,676,494 | 136,463,824 | 137,649,596 | 144,472,235 | |||||||||||||||
Net assets | 9,353,244 | 9,273,361 | 9,821,246 | 9,194,038 | 8,663,847 | |||||||||||||||
Risk-adjusted capital data (Basel III) (4) : | ||||||||||||||||||||
Common Equity Tier 1 capital | ¥ | 6,566,488 | ¥ | 7,001,664 | ¥ | 7,437,048 | ¥ | 7,390,058 | ¥ | 7,244,776 | ||||||||||
Tier 1 capital | 7,905,093 | 8,211,522 | 9,192,244 | 9,232,160 | 9,024,404 | |||||||||||||||
Total capital | 9,638,641 | 10,050,953 | 10,860,440 | 10,917,507 | 10,722,278 | |||||||||||||||
Risk-weighted assets | 62,531,174 | 61,717,158 | 59,528,983 | 57,899,567 | 62,141,217 | |||||||||||||||
Common Equity Tier 1 capital ratio | 10.50 | % | 11.34 | % | 12.49 | % | 12.76 | % | 11.65 | % | ||||||||||
Tier 1 capital ratio | 12.64 | 13.30 | 15.44 | 15.94 | 14.52 | |||||||||||||||
Total capital ratio | 15.41 | 16.28 | 18.24 | 18.85 | 17.25 |
(1) |
Includes refund of income taxes. |
Bills discounted refer to a form of financing in Japan under which promissory notes obtained by corporations through their regular business activities are purchased by banks prior to their payment dates at a discount based on prevailing interest rates. |
Includes negotiable certificates of deposit. |
Risk-adjusted capital data are calculated on a Basel III basis. We |
Exchange Rate Information
The following table sets forth, for each period indicated, the noon buying rate in New York City for cable transfers in yen as certified for customs purposes by the Federal Reserve Bank of New York, expressed in yen per $1.00. The exchange rates are reference rates and are not necessarily the rates used to calculate ratios or the rates used to convert yen to U.S. dollars in the financial statements contained in this annual report.
Fiscal years ended (ending) March 31, | High | Low | Average(1) | Period end | ||||||||||||
(yen per dollar) | ||||||||||||||||
2014 | ¥ | 105.25 | ¥ | 92.96 | ¥ | 100.46 | ¥ | 102.98 | ||||||||
2015 | 121.50 | 101.26 | 110.78 | 119.96 | ||||||||||||
2016 | 125.58 | 111.30 | 120.13 | 112.42 | ||||||||||||
2017 | 118.32 | 100.07 | 108.31 | 111.41 | ||||||||||||
2018 | 114.25 | 104.83 | 110.70 | 106.20 | ||||||||||||
2019 (through May 31) | 111.08 | 105.99 | 109.01 | 108.73 | ||||||||||||
Calendar year 2017 | ||||||||||||||||
December | ¥ | 113.62 | ¥ | 111.88 | — | — | ||||||||||
Calendar year 2018 | ||||||||||||||||
January | ¥ | 113.18 | ¥ | 108.38 | — | — | ||||||||||
February | 110.40 | 106.10 | — | — | ||||||||||||
March | 106.91 | 104.83 | — | — | ||||||||||||
April | 109.33 | 105.99 | — | — | ||||||||||||
May | 111.08 | 108.62 | — | — |
Note:
Failure to maintain capital adequacy ratios above minimum required levels, as a result
We endeavor to maintain sufficient levelsfinancial condition and results of capital adequacy ratios, which are calculated pursuant to standards set forth by Japan’s Financial Services Agency and based on Japanese GAAP, taking into account our plans for investments in risk-weighted assets, the efficiency of our capital structure and other factors. However, our capital adequacy ratios could decline in the future, including as a result of the materialization of any of the risks enumerated in these “Risk Factors” and changes to the methods we use to calculate capital adequacy ratios. Also, there are regulatory adjustments such as goodwill and other intangibles, deferred tax assets, investments in the capital of banking, financial and insurance entities etc., that are deducted from our regulatory capital under certain conditions. Our or our banking subsidiaries’ regulatory capital and capital adequacy ratios could decline due to such regulations.
In addition, if the framework set by the Basel Committee on Banking Supervision, upon which the Financial Services Agency’s rules concerning banks’ capital adequacy ratios are based, is changed or if the Financial Services Agency otherwise changes its banking regulations, we might not be able to meet the minimum regulatory requirements for capital adequacy ratios.operations. For example, in December 2010, the Basel Committee on Banking Supervision issued its Basel III rules text, which presents the details of global regulatory standards on bank capital adequacy and liquidity. In March 2012, the Financial Services Agency published revisions to its capital adequacy guidelines which generally reflect rules in the BaselIII- text and began phasing them in fromfiscal year ended March 31, 2013.2019, we recorded ¥500.7 billion of impairment losses under Japanese GAAP, which unlike U.S. GAAP allows for the option of allocating entity-wide long-lived assets among individual divisions within an entity. The Basel Committee on Banking Supervision reviewedabove losses involved entity-wide long-lived assets, consisting primarily of internally developed software allocated to the risk measurement method and other rules and publisheddomestic retail business division for the finalized Basel III reforms in December 2017. Regulations based on the review are expected to be phased in from 2022.
Furthermore, we have been named onepurpose of the global systemically important banks(“G-SIBs”) and have become subject to additional capital requirements since March 2016. The group ofG-SIBsimpairment test under Japanese GAAP.
If the capital adequacy ratios of us and our banking subsidiaries fall below specified levels, the Financial Services Agency could require us to take corrective actions, including, depending on the level of deficiency, the submission of an improvement plan that would strengthen our capital base, a restriction on the outflow of capital, a reduction of our total assets or a suspension of a portion of our business operations. In addition, some of our banking subsidiaries are subject to capital adequacy regulations in foreign jurisdictions such as the United States, and our business could be adversely affected if theirwe encounter difficulties in raising funds.
markets compared to our
Our business will be adversely affected if we encounter difficulties in raising funds.
We rely principally on deposits and bonds as our funding sources. In addition, we also raise funds in the financial markets. Our efforts
Our Medium-term Business Plan and other strategic initiatives and measures may not result in the anticipated outcome.
We have been implementing strategic initiatives and measures in various areas. In May 2016, we announced our Medium-term Business Plan for the three fiscal years ending March 31, 2019. Also, in November 2017, with the aimstatus of achieving sustainable growth and maintaining and strengthening our competitive advantages over the long term, we developed a basic principle of structural reforms.
However, we may not be successful in implementing such initiatives and measures, or even if we are successful in implementing them, the implementation of such initiatives and measures may not have their anticipated effects. In addition, we may not be able to meet the key targets announced due to these or other factors, including, but not limited to, differences in the actual economic environment compared to our assumptions, as well as the risks enumerated in these “Risk Factors.”
For further information However, our and our principal banking subsidiaries’ capital adequacy ratios could decline in the future, including as a result of the materialization of any of the risks enumerated in these “Risk Factors” and changes to the methods of calculating capital adequacy ratios and other factors. Also, there are regulatory adjustments, such as those related to goodwill and other intangibles, deferred tax assets and investments in the capital of banking, financial and insurance entities, that are deducted from regulatory capital under certain conditions. Our or our principal banking subsidiaries’ regulatory capital and capital adequacy ratios could decline due to such regulations.
We will be exposedbanking subsidiaries are subject to new or increased risks as we expand the range of our products and services.
We offer a broad range of financial services, including banking, trust, securities and other services. As the needs of our customers become more sophisticated and broadercapital adequacy regulations in scope, andforeign jurisdictions such as the Japanese financial industry continuesUnited States, and in the event of a breach of these regulations, they could be subject to be deregulated, we have been entering into various new areas of business, including through various businessrestrictions and equity alliances, which expose us to new risks. While we have developed and intend to maintain risk management policies that we believe are appropriate to address such risks, if a risk materializes in a manner or to a degree outside of our expectations,orders from local authorities. Such events could adversely affect our business, financial condition and results of operations could be materiallyoperations.
We are subject
Our business and employees in Japan are subject to various laws and regulations, including those applicable to financial institutions, as well as general laws applicablethe Financial Services Agency published amendments to our business activities, and we are under the regulatory oversightleverage ratio regulations which will exclude amounts of deposits to the Bank of Japan from the total exposure, which is the denominator, in calculating leverage ratio when a ratio, which is separately determined by the Commissioner of the Financial Services Agency. Our businesses outsideAgency taking into account an exceptional macroeconomic condition, applies as minimum regulatory requirements for leverage ratio. The regulation requires bank holding companies and banks to maintain their leverage ratio, which is a supplementary indicator of the capital adequacy ratio, at a certain level or above. See “Item 5. Operating and Financial Review and Prospects—Capital Adequacy” and “Item 4.B. Business Overview—Supervision and Regulation—Capital Adequacy.” If the leverage ratio falls below a certain ratio, the Financial Services Agency could require us to take corrective actions, including the submission of an improvement plan that would strengthen the capital base, a reduction (or slowing of increase) of total assets, a reduction in the size of some business operations, a disposition of subsidiary shares and a suspension of all or a portion of business operations. Such events could adversely affect our business, financial condition and results of operations.
Our compliance and legal risk management structures are designedraise capital at commercially reasonable costs, or at all. This could negatively affect our ability to prevent violations of such laws and regulations, but they may not be effectivemaintain or improve our capital adequacy ratios in preventing all violations.
Violations of laws and regulations could result in regulatory action and harmaccordance with our reputation,plans, and our business, financial condition and results of operations could be materially and adversely affected.
Employee errors and misconduct could subject us to losses and reputational harm.
Because we process a large number of transactions in a broad range of businesses, we are subject to the risk of various operational errors and misconduct, including those caused by employees. Our measures to reduce employee errors, including establishment of operational procedures, regular reviews regarding compliance with these procedures, employee training and automation of our operations, may not be effective in preventing all employee errors and misconduct. Significant operational errors and misconduct could result in losses, regulatory actions or harm to our reputation. As a result, our business, financial condition and results of operations could be materially and adversely affected.
Sarbanes-Oxley Act of 2002 and rules and regulations of the SEC promulgated pursuant thereto. Our management reports on, and our independent registered public accounting firm attests to, the effectiveness of our internal controls over financial reporting, as required, in our annual report on Form
Transactions with counterparties in Iran and other countries designated by the U.S. Department of State as state sponsors of terrorism may lead some potential customers and investors to avoid doing business with us or investing in our securities or have other adverse effects.
U.S. law generally prohibits U.S. persons from doing business with countries designated by the U.S. Department of State as state sponsors of terrorism (the “Designated Countries”), which currently includes Iran, Sudan, Syria and North Korea and we maintain policies and procedures to comply with applicable U.S. laws. Ournon-U.S. offices engage in transactions relating to the Designated Countries on a limited basis and in compliance with applicable laws and regulations, including trade financing with respect to our customers’ export or import transactions and maintenance of correspondent banking accounts. In addition, we maintain a representative office in Iran. We do not believe our operations relating to the Designated Countries are material to our business, financial condition or results of operations. We maintain policies and procedures to ensure compliance with applicable Japanese and U.S. laws and regulations.
The laws and regulations applicable to dealings involving the Designated Countries are subject to further strengthening or changes. If the U.S. government considers that our compliance measures are inadequate, we may be subject to regulatory action which could materially and adversely affect our business. In addition, we may become unable to retain or acquire customers or investors in our securities, or our reputation may suffer, potentially having adverse effects on our business or the price of our securities.
or otherwise, our banking and other subsidiaries may decide not to pay dividends to us. In addition, we may experience difficulty in making, or become unable to make, dividend payments to our shareholders and dividend or interest payments on capital securities issued by our group due to the deterioration of our results of operations and financial condition and/or the restrictions under the Companies Act or due to the strengthening of bank capital regulations. For more information on restrictions to dividend payments under the Companies Act and bank capital regulations, see “Item 10.B. Additional Information—Memorandum and Articles of Association” and “Item 4.B. Business Overview—Supervision and Regulation—Japan.”
operations could be materially and adversely affected.
that we have developed such as establishing
custodian, is the record holder of the shares underlying the ADSs, a holder of ADSs may not be entitled to the
ITEM 4. | INFORMATION |
We launched our three-year medium-term business plan the “Progressive Development of “One MIZUHO”—The Path tospanning a Financial Services Consulting Group,” formulated for the three years beginningfive-year period starting from the fiscal year ended March 31, 2017. This2019. The plan aims for (i) further reinforcementis titled
We are positioning our asset management function and our research and consulting functions as new pillars that supplement the banking, trust and securities functions, and by strivingfinance in order to provide the best possible and optimal services to customers for their improved satisfaction, we aim to become an indispensable partner for achieving sustainable growth of corporate customers and securing a promising future of retail customers.
With the aim of establishing this new business model,solutions. For more information on initiatives that we have set forth five basic policiestaken in the medium-term business plan. The five basic policies are supported by ten basic strategies, which are classified into business strategies, financial strategies and management foundations.
Our Objectives Under the Medium-Term Business Plan
By establishing a customer-focused business platform, we will form deeper relationships with our customers via our financial intermediary functions and our ability to take highly measured risks and build a future in economies and communities as a trusted financial partner in providing solutions for our customers. In the interest of building this new business model, we have established the following objectives in the medium-term business plan.
A Financial Services Consulting Group—The most trusted partner in solving problems and supporting the sustainable growth of customers and communities
Five Basic Policies
Ten Basic Strategies
Business strategies
Financial strategies
Management foundations
In the fiscal year ended March 31, 2018,2020, see “—Group Operations—Group Management Structure.”
First,line with an approach that prioritizes employees’ professional growth and career preferences and promote a new human resources management strategy focused on maximizing our workforce value in a manner that is universally recognizable.
In addition, with respect to the fulfillment of fiduciary duties, in addition to our policies and action plans for each group company regarding the asset management-related business, we set and published quantitative key performance indicators to confirm the extent to which our fiduciary duties are being fulfilled and implemented various kinds of customer-focused measures.
Secondly, we have promoted “operational excellence” in order to improve productivity. With the aim of “improving operational efficiency” and “enhancing service value for customers by raising the sophistication of our operations,” we have streamlined head office operations and advanced our business process reform through the utilization of digital technologies such as robotic process automation (i.e., software that is capable of inputting, processing, collecting and checking data that requires simple judgment, which can be utilized for the automation of routine manual tasks) and employeemind-set reforms, etc.
Thirdly, we have actively worked on improving innovation. Under a new structure for promoting innovation, which the CDIO (Chief Digital Innovation Officer) is exclusively in charge of, we have advanced ourdrive initiatives by establishing Blue Lab Co., Ltd. for the purposes of creating next-generation business models and actual commercialization related businesses, and commenced“AI-based Score Lending,” (i.e., an individual consumer financing service that provides reference values for lending terms, such as interest rates and borrowing limits, based onAI-based score levels), one of the first FinTech services in Japan, provided by J.Score CO., LTD.
Fourthly, in order to contribute to the sustainable development of society and to create new corporate value, we have pursued a CSR initiative regarding environmental, societal and governance (ESG) issues. With respect to environment and society, we issued green bonds and developed a human rights policy in line with international standards, among other initiatives. With respect to governance, we became the first Japanese bank holding company for which the Chairman of the Board of Directors and the chairmen of the three legally-required committees are all outside directors, and each of Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co., Ltd. (the “Three Core Companies”) changed its corporate governance system from the “Company with Board of Company Auditors” structure to the “Company with Audit and Supervisory Committee” structure.
Finally, with respect to legal compliance, we continued our various efforts, including severing transactions with anti-social elements and our countermeasures against money laundering and terrorist financing.
The business environment surrounding financial institutions continues to be challenging, and we anticipate it will undergo major structural changes over time. Under these circumstances, we will undertake fundamental structural reforms in our business structure, and, based on aten-year time horizon, we will strive to secure our sustainable growth and continued competitive advantage.
We will utilize advanced technologies in accordance with the expectations of society, our concept of open innovation to further developstrategy and the Principles for Responsible Banking. With our “One MIZUHO strategy” by, for example, (i) endeavoring to increase profit through actively pursuing collaborative engagement with other companies, not limited to financial activities, in order to create new business opportunities and (ii) endeavoring to strengthen cost competitiveness and enhance productivity while striving to optimize organization and staffing, restructure branch strategies and accomplish other related tasks.
In the fiscal year ending March 31, 2019, in order to address three material issues, “launching and implementing fundamental structural reforms,” “achieving the medium-term business plan” and “completing implementation of our next generation IT systems,” we are focusing our attention on progressively developing our “One MIZUHO strategy” by implementing changes to the structure and foundations of our business, further integrating our “customer first” principle into everything we do and fundamentally increasing productivity, andsustainability initiatives, we will work to advance such strategy by placing emphasisfurther emphasize the perspective of environmental conservation and promote initiatives on key sustainability areas based on the points described below.
Increasing Our Earning Capacity through Fully Implementing Our Customer First Principle
Through strengthening customer contacts, ensuring awareness of customer needsfollowing approaches set out in the policy:
Selecting and Focusing on Certain Areas of Business
By improving the reasonable allocation of management resources in relation to the focus and streamline areas by which targets and markets are narrowed, we will work to make efficient use of our limited management resources and increase our earnings capacity. In the focus areas, we will work to expand the area and breadth of risk taking and will commence strengthening new and growing businesses.
Establishment of a Resilient Financial Base
By capturing signs of changes in the business environment and exercising flexible and effective control over our balance sheets, we will seek to optimize risk and return. With respect to the disposal of cross-shareholdings, we will work to achieve targets set forth in the medium-term business plan. In addition, by thoroughly reviewing our business processes through the pursuit of “operational excellence” and other similar efforts and by reviewing our working style, we will reform our cost structure.
Utilization of Technology and Data
We will strengthen our ability to develop and promote group-wide digital innovation strategies and will promote efforts towards the utilization of technology and data, and theco-creation of value through collaboration with other companies in each area of productivity enhancement through upgraded business processes, the reform of business foundation and the creation of new businesses.
Transforming Our Corporate Culture into One that Encourages the Active Participation of Our Workforce to Support a Stronger Mizuho
We will seek to establish and spread the “fundamental reform of HR management” by promoting, among other matters, HR management that respects employees’ individuality, active participation of a diverse workforce, a work-life balance initiative to provide flexible and varied work arrangements and the “health and productivity management” initiative. We will also proceed withmultifaceted support for initiatives toward the transformation of our corporate culture, such asmind-set reforms that encourage employees to take on challenges and eliminate inward-facing energy.
Completion of Implementation of our Next Generation IT Systems
As our most important and largest systems project, we will take all possible measures to complete the implementation of our next-generation IT systems in a safe and steady manner.
In addition to the foregoing efforts, we will also continue to endeavor to upgrade our risk appetite framework and strengthen our attitude toward governance and compliance with laws and regulations, including severance of business relations with anti-social elements.
As already announced, Trust & Custody Services Bank, Ltd., which is our consolidated subsidiary, has executed a management integration agreement with Japan Trustee Services Bank, Ltd. to the effect that both parties will carry out management integration. The integrated company will aim to be the top trust bank in Japan specializing in asset administration services that meet a wide variety of customer needs regarding asset administration services.
We will also continue to consider the possibility of consolidation between Mizuho Bank and Mizuho Trust & Banking.
We will contribute to the sustainable development of society by pursuing a CSR initiative toward addressing social challenges, such as the Sustainable Development Goals (i.e.,(SDGs) and environmental, social and governance (ESG) concerns.
In addition,implementation, we will continue to implement measures to further improvemake a comprehensive decision by taking into account the value of our brand through means suchcircumstances and situations as positive communicationwell as international frameworks, agreements or consensus, with various stakeholdersa long-term perspective towards harmony with the economy, industry, society and extending support to the Olympic and Paralympic Games Tokyo 2020 (Mizuho is a Tokyo 2020 Gold Banking Partner).
environment.
corporations, engages in consulting services that integrate banking, trust banking, securities and other functions within the Mizuho group, as well as providing convenient financial services by leveraging advanced technologies and forming alliances with other companies.
While fulfilling our fiduciary duties, to promote the change “from savings to investments”As a reliable partner in an era of lengthening lifespans, we support customers who have concerns about their long term plans, and in addition to the consulting services that combine banking, trust banking and securities functions, we offer our customers asset formation support that utilizes advanced technologies, such as
a web based app that can be used to manage inheritance.
business model that utilizes advanced technology.
2020.
services, in light of changing customer needs due to ongoing digitalization.
Starting from consulting services,
Moreover, we leverage our existing customer base to support the growth of innovative companies that show future promise by means of finance and other solutions.
Japan, provides custom-designed solutions for each client on a group-wide basis to meet their capital raising, asset management and business/financial strategy related needs.
We are also strengthening business structures across the group by increasing personnel and reframing the business structure
Through these endeavors,
clients as a strategic partner for our clients’ business development, and build new relationships with clients and realize value
Japan and
We
Strategy, which involves focusing on a group of approximately 300 blue-chip companies around the world. Taking the characteristics of each industry sector into consideration, we take a focused approach based on ourknow-how and insight on the business and financial aspects. Through a close relationship with top management, weWe will aim to develop long-term relationships withprovide enhanced financial services by utilizing our customers. Our markethigh presence within the United States continues to grow, including in the area of investment-grade corporate debt underwriting, based on the enhanced sophisticationU.S. capital markets and network in the collaboration between our banking and securities functions.
Asian economic regions that have been growing rapidly.
We are forming business alliances with government-affiliatedlocal financial institutions and financialgovernment-affiliated institutions to providecustomers, including post-entry support.
As we see major changes in the global economy and the regulatory framework, wecustomers. We will aim to achieve sustainable growthbuild long-term relationships with customers by improvingutilizing business and financial consulting and our close relationships with the top management of corporate customers based on our
concentration.
organizational structure based on arising customer needs.
presence in the financial market.
We will engage in investment decision incorporating portfolio management, focusing on the balance between realized gains and valuation gains and losses and axes of ESG and SDGs.
The Global Markets Company is aimingmarket mechanisms that has insight into markets, we will aim to becomeenhance our asset allocation and product lineup and aim to establish atop-class Asian player in stable profit base. At the global market by utilizing its capacitysame time, we will strive to offer a wide rangeprovide appropriate investment opportunities to investors with different risk appetite.
formation in order to meet their various needs.
United States.
The Asset Management Company aims
in Japan and realize medium- to long-term growth of our asset management business.
stock transfer agency.
as follows:
domestically, including loans for renewable energy-related projects and arrangement of PFI/PPP deals. In addition, we offer investment opportunities to institutional investors through our managed infrastructure debt funds. |
the character of their business:
The Global Products Unit aims
larger pool of specialists in each area to further increase our expertise.
that cover many fields, including business strategy.
business origination function.
With increased globalcare by utilizing financial engineering and digital knowledge.
Through such efforts, our “One Think Tank” teamsstarting point of experts are tackling a variety of new areas and further strengthening intra-group collaboration in order to contribute to the further developmentvalue chains of our customers and society as the “source of value creation.”
In April 2019, the maximum deposit amount that Japan Post Bank Co., Ltd. may accept increased from 13 million yen in aggregate for ordinary deposits and time deposits to a total of 26 million yen, 13 million yen each for ordinary deposits and time deposits.
Furthermore, under the Japanese TLAC regulations introduced in March 2019, the Financial Services Agency, acting on behalf of the Prime Minister, may order the bank holding company of a
Guidelines.
limited circumstances, the Financial Services Agency may order such principal shareholder to take such measures as the Financial Services Agency deems necessary.
or subscribe for shares of the bank holding company of the bank, in order to enhance capital adequacy of the bank (item 1 measures (dai ichigo sochi)); (ii) if the bank is likely to suspend or has suspended repayment of deposits or is unable to fully perform its obligations with its assets, financial aid exceeding the
If the Deposit Insurance Corporation has provided such financial assistance, the Prime Minister may designate the movable assets and claims of the failed financial institution as not subject to attachment under Article
exceptions for disaster-affected financial institutions. In 2016, the law was further amended to extend the period for application to March 31, 2022. Furthermore, in order to strengthen business bases of financial institutions by addressing the effects resulting from
The prompt corrective action system requires financial
Based on
taking into account the lending policy of each bank and actual financial status of each obligor, using the aforementioned reserves practice as a starting point.
In addition, in light of the Basel Committee on Banking Supervision’s final standard regarding the larger exposure framework published in April 2014, further amendments to the cabinet order and related regulations under the Banking Act became
adjustments such as goodwill and other intangibles, deferred tax assets, investments in the capital of banking, financial and insurance entities etc. shall be deducted under certain conditions for the purpose of calculating capital adequacy ratios, and the requirements of regulatory adjustments were enhanced under the revised capital adequacy guidelines. For example, under the capital adequacy guidelines prior to the revision thereto under the Basel III rules, the maximum amount of net deferred tax assets under Japanese GAAP that major Japanese banks, including bank holding companies, could record without diminishing the amount of Tier 1 capital for purposes of calculating capital adequacy ratio was 20% of Tier 1 capital. Under the revised capital adequacy guidelines based on the Basel III rules, deferred tax assets that arise from temporary differences will be recognized as part of Common Equity Tier 1 capital, with recognition capped at 10% of Common Equity Tier 1 capital under certain conditions, while other deferred tax assets, such as those relating to net loss carryforwards, will be deducted in full from Common Equity Tier 1 capital net of deferred tax liabilities. These regulatory adjustments based on the Basel III rules began at 20% of the required deductions in the calculation of Common Equity Tier 1 capital in March 2014 and were increased by 20% increments per year, and became fully effective in March 2018.
a downturn by reducing incentives for banks to deleverage abruptly and excessively.
The revised framework
2028. Following such announcement, the Financial Services Agency announced on March 30, 2020 that the Basel III finalisation framework is scheduled to be implemented in Japan from March 2023.
The Financial Services Agency applied the requirement from March 31, 2019 to meet the minimum leverage ratio for bank holding companies and banks with international operations.
2023.
guidelines. In accordance with the LCR standard under the LCR guidelines, the stock of unencumbered HQLA is to constitute “level 1” assets, which include cash, central bank reserves and certain marketable securities backed by sovereigns and central banks, and “Level 2” assets, which include certain government securities covered bonds, corporate debt securities and, to a limited extent, lower-rated corporate bonds, residential mortgage-backed securities and equities that meet certain conditions. “Level 2” assets are subject to certain haircuts based on types of securities and credit ratings. The minimum LCR under the LCR guidelines is 100% on both a consolidated andLCR is subject tophase-in arrangements pursuant to which the LCR rises in equal annual steps of 10 percentage points to reach 100% on January 1, 2019, with a minimum requirement of 90% during the period from January 1 to December 31, 2018. The BCBS issued final requirements for
However, it has decided not to introduce the NSFR until March 2021 after two postponements of the introduction in March 2019 and March 2020.
The guidelines were partially revised on April 10, 2019, intending to further enhance financial institutions’ risk management for anti-money laundering and combating the financing of terrorism.
As FHC status also permits banking groups in the United States to engage in merchant banking activities, as described above.
and representative office of Mizuho Bank is also subject to regulation and examination by the state banking authority of the state in which such branch or representative office is located. The deposits of Mizuho Bank’s U.S. branches are not insured by the Federal Deposit Insurance Corporation (“FDIC”)
.
Federal Reserve Board extended the conformance period to July 21, 2017 for investments in and relationships with certain funds that were in place prior to December 31, 2013. In addition, prior to the expiration of the general conformance period, banking entities with investments in or relationships with certain “illiquid” funds” were permitted to seek an additional
In July 2019, U.S. federal regulatory agencies adopted amendments to the Volcker Rule regulations to implement the Volcker Rule amendments included in the EGRRCPA, and also in 2019 such U.S. federal regulatory agencies adopted certain targeted amendments to the Volcker Rule regulations to simplify and tailor certain compliance requirements relating to the Volcker Rule. In January 2020, U.S. federal regulatory agencies proposed additional revisions to the Volcker Rule’s current restrictions on banking entities sponsoring and investing in certain covered hedge funds and private equity funds, including by proposing new exemptions allowing banking entities to sponsor and invest without limit in credit funds, venture capital funds, customer facilitation funds and family wealth management vehicles. The proposal would also loosen certain other restrictions on extraterritorial fund activities and direct parallel or
Legacy guarantees
Duringactivities in the period covered by this disclosure, Mizuho Bank was a party to a legacy counter guarantee that was opened in connection with activity of its customer for the benefit of an Iranian bank. When the guarantee was entered into, the bank in question, which is related to the Government of Iran, had not been designated under U.S. Executive Orders (“E.O.”) 13224 or 13382, although it was subsequently so designated. Mizuho Bank maintained this guarantee post-designation only after confirming that such a transaction did not involve prohibited or sanctionable activity under U.S. or other economic sanctions. As contractual obligations, this guarantee cannot be exited by Mizuho Bank unilaterally. fiscal year ended March 31, 2020.
Activities through correspondent bankingmaintain accounts
In the fiscal year ended March 31, 2018, Mizuho Bank conducted a limited number of fund transfers through accounts it maintains for or at a limited number of Iranian banks related to the Government of Iran and a bank designated under E.O. 13224, but conducted no funds transfers through these accounts or through other correspondent banking accounts on behalf of such Iranian banks. These transfers were mainly associated with requests by our customers after the relaxation of applicable sanctions pursuant to the Joint Comprehensive Plan of Action. Mizuho Bank has policies and procedures to process transfers through these accounts only after confirming that such
2020:
(1) | JTC Holdings, in which we have a 27.0% equity interest, is an equity-method affiliate of ours. JTC Holdings, Japan Trustee Services Bank, Ltd. and Trust & Custody Services Bank, Ltd., which are equity-method affiliates of ours, plan to merge as of July 27, 2020 and to change the trade name of the merged entity to “Custody Bank of Japan, Ltd.” |
(2) | Mizuho Information & Research Institute, Inc., Mizuho Research Institute Ltd. and Mizuho Trust Systems Company, Limited are scheduled to merge in April 2021. |
(3) | Mizuho Financial Group has a 35.0% equity interest in Mizuho Operation Service, Ltd. and has added it to the core group companies as an equity-method affiliate as of June 30, 2020. |
Name | Country of | Main business | Proportion of ownership interest (%) | Proportion of voting interest (%) | ||||||||
Domestic | ||||||||||||
Mizuho Bank, Ltd. | Japan | Banking | 100.0 | % | 100.0 | % | ||||||
Mizuho Trust & Banking Co., Ltd. | Japan | Trust and banking | 100.0 | % | 100.0 | % | ||||||
Mizuho Securities Co., Ltd. | Japan | Securities | 95.8 | % | 95.8 | % | ||||||
Mizuho Research Institute Ltd. | Japan | Research and consulting | 98.6 | % | 98.6 | % | ||||||
Mizuho Information & Research Institute, Inc. | Japan | Information technology | 91.5 | % | 91.5 | % | ||||||
Asset Management One Co., Ltd. | Japan | Investment management | 70.0 | % | 51.0 | % | ||||||
Trust & Custody Services Bank, Ltd. | Japan | Trust and banking | 54.0 | % | 54.0 | % | ||||||
Mizuho Private Wealth Management Co., Ltd. | Japan | Consulting | 100.0 | % | 100.0 | % | ||||||
Mizuho Credit Guarantee Co., Ltd. | Japan | Credit guarantee | 100.0 | % | 100.0 | % | ||||||
Mizuho Realty Co., Ltd. | Japan | Real estate agency | 100.0 | % | 100.0 | % | ||||||
Mizuho Factors, Limited | Japan | Factoring | 100.0 | % | 100.0 | % | ||||||
Mizuho Realty One Co., Ltd. | Japan | Holding company | 100.0 | % | 100.0 | % | ||||||
Defined Contribution Plan Services Co., Ltd. | Japan | Pension plan-related business |
| 60.0 | % |
| 60.0 | % | ||||
Mizuho-DL Financial Technology Co., Ltd. | Japan | Application and Sophistication of Financial Technology |
| 60.0 | % |
| 60.0 | % | ||||
UC Card Co., Ltd. | Japan | Credit card | 51.0 | % | 51.0 | % | ||||||
J.Score CO., LTD | Japan | Lending | 50.0 | % | 50.0 | % |
Name | Country of organization | Main business | Proportion of ownership interest (%) | Proportion of voting interest (%) | ||||
Domestic | ||||||||
Mizuho Bank, Ltd | Japan | Banking | 100.0% | 100.0% | ||||
Mizuho Trust & Banking Co., Ltd. | Japan | Trust and banking | 100.0% | 100.0% | ||||
Mizuho Securities Co., Ltd. | Japan | Securities | 95.8% | 95.8% | ||||
Mizuho Research Institute Ltd | Japan | Research and consulting | 100.0% | 100.0% | ||||
Mizuho Information & Research Institute, Inc | Japan | Information technology | 100.0% | 100.0% | ||||
Asset Management One Co., Ltd. | Japan | Investment management | 70.0% | 51.0% | ||||
Mizuho Private Wealth Management Co., Ltd | Japan | Consulting | 100.0% | 100.0% | ||||
Mizuho Credit Guarantee Co., Ltd. | Japan | Credit guarantee | 100.0% | 100.0% | ||||
Mizuho Realty Co., Ltd. | Japan | Real estate agency | 100.0% | 100.0% | ||||
Mizuho Factors, Limited | Japan | Factoring | 100.0% | 100.0% | ||||
UC Card Co., Ltd. | Japan | Credit card | 100.0% | 100.0% | ||||
Mizuho Realty One Co., Ltd. | Japan | Holding company | 100.0% | 100.0% | ||||
Mizuho Business Service Co., Ltd. | Japan | Subcontracted operations | 100.0% | 100.0% | ||||
Defined Contribution Plan Services Co., Ltd | Japan | Pension plan-related business | 60.0% | 60.0% | ||||
Mizuho-DL Financial Technology Co., Ltd | Japan | Application and Sophistication of Financial Technology | 60.0% | 60.0% | ||||
J.Score Co., Ltd. | Japan | Lending | 50.0% | 50.0% | ||||
Mizuho Trust Systems Company, Limited | Japan | Subcontracted calculation services, software development | 50.0% | 50.0% | ||||
Mizuho Capital Co., Ltd. | Japan | Venture capital | 50.0% | 50.0% | ||||
Overseas | ||||||||
Mizuho Americas LLC | USA | Holding company | 100.0% | 100.0% | ||||
Mizuho Bank (China), Ltd | China | Banking | 100.0% | 100.0% | ||||
Mizuho International plc | UK | Securities and banking | 100.0% | 100.0% | ||||
Mizuho Securities Asia Limited | China | Securities | 100.0% | 100.0% | ||||
Mizuho Securities USA LLC | USA | Securities | 100.0% | 100.0% | ||||
Mizuho Capital Markets LLC | USA | Derivatives | 100.0% | 100.0% | ||||
Mizuho Bank Europe N.V. | Netherlands | Banking and securities | 100.0% | 100.0% | ||||
Banco Mizuho do Brasil S.A. | Brazil | Banking | 100.0% | 100.0% | ||||
Mizuho Trust & Banking (Luxembourg) S.A. | Luxembourg | Trust and banking | 100.0% | 100.0% | ||||
Mizuho Bank (USA) | USA | Banking and trust | 100.0% | 100.0% | ||||
Mizuho Securities Europe GmbH | Germany | Securities | 100.0% | 100.0% | ||||
PT. Bank Mizuho Indonesia | Indonesia | Banking | 99.0% | 99.0% |
Name | Country of | Main business | Proportion of ownership interest (%) | Proportion of voting interest (%) | ||||||||
Mizuho Trust Systems Company, Limited | Japan | Subcontracted calculation services, software development |
| 50.0 | % |
| 50.0 | % | ||||
Mizuho Capital Co., Ltd. | Japan | Venture capital | 50.0 | % | 50.0 | % | ||||||
Overseas | ||||||||||||
Mizuho Americas LLC | U.S.A. | Holding company | 100.0 | % | 100.0 | % | ||||||
Mizuho Bank (China), Ltd. | China | Banking | 100.0 | % | 100.0 | % | ||||||
Mizuho International plc | U.K. | Securities and banking | 100.0 | % | 100.0 | % | ||||||
Mizuho Securities Asia Limited | China | Securities | 100.0 | % | 100.0 | % | ||||||
Mizuho Securities USA LLC | U.S.A. | Securities | 100.0 | % | 100.0 | % | ||||||
Mizuho Bank Europe N.V. | Netherlands | Banking and securities | 100.0 | % | 100.0 | % | ||||||
Banco Mizuho do Brasil S.A. | Brazil | Banking | 100.0 | % | 100.0 | % | ||||||
Mizuho Trust & Banking (Luxembourg) S.A. | Luxembourg | Trust and banking | 100.0 | % | 100.0 | % | ||||||
Mizuho Bank (USA) | U.S.A. | Banking and trust | 100.0 | % | 100.0 | % | ||||||
Mizuho Bank (Switzerland) Ltd | Switzerland | Banking and trust | 100.0 | % | 100.0 | % | ||||||
Mizuho Capital Markets LLC | U.S.A. | Derivatives | 100.0 | % | 100.0 | % | ||||||
PT. Bank Mizuho Indonesia | Indonesia | Banking | 99.0 | % | 99.0 | % |
As of March 31, | ||||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Land | ¥ | 575,054 | ¥ | 566,040 | ||||
Buildings | 807,312 | 811,911 | ||||||
Equipment and furniture | 485,407 | 484,102 | ||||||
Leasehold improvements | 93,967 | 97,066 | ||||||
Construction in progress | 23,093 | 25,849 | ||||||
Software | 1,308,292 | 1,463,786 | ||||||
|
|
|
| |||||
Total | 3,293,125 | 3,448,754 | ||||||
Less: Accumulated depreciation and amortization | 1,251,852 | 1,332,570 | ||||||
|
|
|
| |||||
Premises and equipment—net | ¥ | 2,041,273 | ¥ | 2,116,184 | ||||
|
|
|
|
2020:
As of March 31, | ||||||||
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Land | ¥ | 563,032 | ¥ | 557,943 | ||||
Buildings | 826,781 | 657,774 | ||||||
Equipment and furniture | 472,186 | 442,302 | ||||||
Leasehold improvements | 97,508 | 228,383 | ||||||
Construction in progress | 37,174 | 73,164 | ||||||
Software | 1,366,481 | 1,359,120 | ||||||
Total | 3,363,162 | 3,318,686 | ||||||
Less: Accumulated depreciation and amortization | 1,462,210 | 1,462,438 | ||||||
Premises and equipment—net | ¥ | 1,900,952 | ¥ | 1,856,248 | ||||
ITEM 4A. | UNRESOLVED STAFF COMMENTS |
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101 |
TheOur principal activities and subsidiaries are the following:SME”s)SMEs”), large corporations, financial institutions, public sector entities and foreign corporations, including foreign subsidiaries of Japanese corporations;
denominatedavailable-for-salecurrency-denominated debt securities that are elected for fair value treatment under ASC 825. For further information on the fair value option, see note 28 to our consolidated financial statements included elsewhere in this annual report.
reported as Trading securities.
production activities. In response to the spread of
consumer spending and expansionthe impact of exports, which were backed by income growth and governmental policies to supporttrade friction with the economy adopted in preparation for the National Congress of the Communist Party of China in Fall 2017. The economies inUnited States.
In Japan, the economy continued to recover due to such factors as overseas economic expansion and strong domestic demand. Regarding domestic demand, the improvement of the inventory cycle, the rise of capital investment related to the 2020 Tokyo Olympic Games and productivity improvements, as well as the implementation of public investment in connection with Japan’s economic stimulus measures, served to bolster growth. Consumer spending continued to pick upoutflows have been observed, partly due to the replacement of durable goods and the effect of wage increases especially in SMEs. Under such circumstances, stock prices trended upward and the exchange rate continued to trend sideways; however, since February 2018, stock prices have entered a correction phase with a stronger yen due to the rise in long-term interest ratesfall in the United Statesprices of crude oil and concerns regarding the protectionist policies of the United States administration. On the other hand, long-term interest rates in Japan continued to remain low at around zero percent under the Bank of Japan’s “quantitative and qualitative monetary easing with yield curve control.”
resources.
investments.
Japan’s real gross domestic product on a1.4%, 1.2% and 1.6%0.3% in the fiscal yearsyear ended March 31, 2016, 20172019 and 2018, respectively. Japan’s real gross domestic product on a quarterly basis, compared to the corresponding period of the previous year, increased consecutively from the first quarter of calendar year 2015 through the first quarter of calendar year 2018. Japan’s core nationwide consumer price index wasalmost unchanged in the fiscal year ended March 31, 2016, decreased by 0.2% in2020. During the fiscal year ended March 31, 20172020, theyearyears ended March 31, 2018.
The following chart shows movements in
|
In July 2019, December 2019 and June 2020, we redeemed ¥20.0 billion, ¥15.0 billion and ¥10.0 billion of dated subordinated bonds with a write-down feature that are BaselIn the fiscal year ended2018, we strengthened our capital base2020 decreased slightly compared to March 31, 2019 due mainly to a decrease in net unrealized gains (losses) on other securities as a result of earning ¥576.5 billion ofthe declines in the stock market, partly offset by profit attributable to owners of parent (under Japanese GAAP). since April 2017, we have redeemed various securities that are eligible regulatory capital instruments subject to2018,2019, we redeemed ¥274.5¥303.0 billion ofJanuaryJuly 2008. With respect to Tier 2 capital, in April 2017, January 2018June 2019, September 2019 and March 2018,October 2019, we redeemed ¥50.0¥54.0 billion, ¥70.0¥33.0 billion and ¥50.0¥80.0 billion of dated subordinated bonds issued by our subsidiary bank in April 2007, January 2008June 2009, September 2009 and March 2008,October 2012, respectively.new issuances, in July 2017,2019, we issued ¥460.0¥235.0 billion of perpetual subordinated bonds with optional-redemptionan optional redemption clause and a write-down clause that are Baselnew issuances, in June 2017,2019 and October 2019, we issued ¥114.0¥90.0 billion and ¥158.0 billion, respectively, of dated subordinated bonds with a write-down feature that are Basel Tier 2 capital instruments through public offerings to retail investors in Japan. In June 2018, we issued ¥40.0 billion and ¥70.0 billion of dated subordinated bonds with a write-down feature that are BaselIII-eligiblerespectively, in Japan.11.34%12.76% and 12.49%11.65% as of March 31, 20172019 and 2018,2020, respectively.20182020 were ¥7.5 per share of common stock (including interim dividend payments of ¥3.75 per share), which was the same amount as the annual cash dividend per share for the previous fiscal year.
Creation
In July 2017, Mizuho Bankmanagement’s expectation that the global economy will experience the greatest pressure from the pandemic in the first half of the fiscal year and WiL, LLC establishedthen move into a joint venture named Blue Lab, Co., Ltd.recovery stage towards the end of the fiscal year. The extent to drivewhich COVID-19 impacts our business, generation through innovative technological advances. Blue Labclient and borrowers will depend on future developments, which are highly uncertain and cannot be predicted. Among many potential factors from the COVID-19 pandemic that may impact negatively our future results of operations, there is focuseda high likelihood that credit-related costs for the fiscal year ending March 31, 2021 (based on Japanese GAAP) will be even larger than those in the creation and commercialization of next-generation business models through open innovation. In September 2017, J. Score CO., Ltd, which was establishedfiscal year ended March 31, 2020.
Merger ofInformation & Research Institute, Inc., Mizuho Bank (USA)Research Institute Ltd. and Mizuho Trust Systems Company, Limited in April 2021 with Mizuho Information & Banking Co. (USA)
In December 2017, two subsidiaries of Mizuho Americas LLC, namelyResearch Institute, Inc. as the former Mizuho Bank (USA) and the Mizuho Trust & Banking Co. (USA), merged. The merged entity, Mizuho Bank (USA), provides both banking services and trust services. This merger streamlines Mizuho’s corporate operations in the United States, reinforcing its governance structure, while providing enhanced support to clients investing and expanding businesses in the United States.
Execution of Agreement Concerning the Integration of Trust Banks Specializing in Asset Administration Services (Joint Share Transfer)
In March 2018, Trust & Custody Services Bank, Ltd., a subsidiary of ours, executed a management integration agreement with Japan Trustee Services Bank, Ltd. to carry out the management integration through incorporation of a holding company by joint share transfer.surviving entity. The purpose of the integration is to contributesignificantly improve the ability of Mizuho Information & Research Institute, Inc. as the
Fundamental Structural Reforms
The business environment surrounding financial institutions continues to be difficult, and we anticipate it will undergo major structural changes over time. Under these circumstances, we will undertake fundamental structural reforms in our business structure, and, based on aten-year time horizon, we will strive to secure our sustainable growth and continued competitive advantage. We will utilize advanced technologies in accordance with our concept of open innovation to further develop our “One MIZUHO strategy” by, for example, (i) endeavoring to increase profit through actively pursuing collaborative engagement with other companies, not limited to financial activities, in order to create new business opportunities and (ii) endeavoring to strengthen cost competitiveness and enhance productivity while striving to optimize organization and staffing, restructure branch strategies and accomplish other related tasks.
capabilities.
condition and results of operations. Certain of these accounting policies require management to make critical accounting estimates that involve complex and subjective judgments and the use of assumptions, some of which may be for matters that are inherently uncertain and susceptible to change. Such critical accounting estimates are based on information available to us as of the date of the financial statements and could change from period to period. Critical accounting estimates could also involve estimates for which management could have reasonably used another estimate for the relevant accounting period. The use of different estimates could have a material impact on our financial condition and results of operations. The following is a discussion of significant accounting policies for which critical accounting estimates are used.
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Level 1 | Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market. | |
| ||
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments. If no quoted market prices are available, the fair values of debt securities and over-the-counter derivative contracts in this category are determined using pricing models with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. | |
| ||
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques. |
Fiscal years ended March 31, | ||||||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Interest and dividend income | ¥ | 1,500 | ¥ | 1,509 | ¥ | 1,762 | ||||||
Interest expense | 495 | 602 | 890 | |||||||||
|
|
|
|
|
| |||||||
Net interest income | 1,005 | 907 | 872 | |||||||||
Provision (credit) for loan losses | 35 | 38 | (126 | ) | ||||||||
|
|
|
|
|
| |||||||
Net interest income after provision (credit) for loan losses | 970 | 869 | 998 | |||||||||
Noninterest income | 1,884 | 1,368 | 1,605 | |||||||||
Noninterest expenses | 1,657 | 1,757 | 1,764 | |||||||||
|
|
|
|
|
| |||||||
Income before income tax expense | 1,197 | 480 | 839 | |||||||||
Income tax expense | 347 | 91 | 237 | |||||||||
|
|
|
|
|
| |||||||
Net income | 850 | 389 | 602 | |||||||||
Less: Net income (loss) attributable to noncontrolling interests | — | 27 | 24 | |||||||||
|
|
|
|
|
| |||||||
Net income attributable to MHFG shareholders | ¥ | 850 | ¥ | 362 | ¥ | 578 | ||||||
|
|
|
|
|
|
Fiscal years ended March 31, | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Interest and dividend income | ¥ | 2,207 | ¥ | 2,150 | ||||
Interest expense | 1,313 | 1,271 | ||||||
Net interest income | 894 | 879 | ||||||
Provision (credit) for loan losses | 32 | 156 | ||||||
Net interest income after provision (credit) for loan losses | 862 | 723 | ||||||
Noninterest income | 1,222 | 1,308 | ||||||
Noninterest expenses | 1,999 | 1,878 | ||||||
Income before income tax expense | 85 | 153 | ||||||
Income tax expense | 9 | 47 | ||||||
Net income | 76 | 106 | ||||||
Less: Net income (loss) attributable to noncontrolling interests | (9 | ) | (44 | ) | ||||
Net income attributable to MHFG shareholders | ¥ | 85 | ¥ | 150 | ||||
2020.
Fiscal years ended March 31, | ||||||||||||||||||||||||||||||||||||
2016 | 2017 | 2018 | ||||||||||||||||||||||||||||||||||
Average balance | Interest amount | Interest rate | Average balance | Interest amount | Interest rate | Average balance | Interest amount | Interest rate | ||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks | ¥ | 29,485 | ¥ | 30 | 0.10 | % | ¥ | 37,389 | ¥ | 27 | 0.07 | % | ¥ | 39,812 | ¥ | 27 | 0.07 | % | ||||||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 4,309 | 10 | 0.22 | 5,079 | 18 | 0.35 | 5,283 | 23 | 0.43 | |||||||||||||||||||||||||||
Trading account assets | 5,262 | 16 | 0.31 | 4,408 | 27 | 0.62 | 4,654 | 50 | 1.07 | |||||||||||||||||||||||||||
Investments | 25,625 | 88 | 0.34 | 20,357 | 78 | 0.38 | 21,267 | 97 | 0.46 | |||||||||||||||||||||||||||
Loans | 52,866 | 565 | 1.07 | 53,930 | 510 | 0.95 | 58,049 | 511 | 0.88 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-earning assets | 117,547 | 709 | 0.60 | 121,163 | 660 | 0.54 | 129,065 | 708 | 0.55 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Deposits | 81,090 | 60 | 0.07 | 83,293 | 51 | 0.06 | 90,078 | 60 | 0.07 | |||||||||||||||||||||||||||
Short-term borrowings(1) | 15,139 | 22 | 0.15 | 14,177 | 27 | 0.19 | 13,678 | 43 | 0.31 | |||||||||||||||||||||||||||
Trading account liabilities | 2,092 | 13 | 0.61 | 1,697 | 14 | 0.82 | 1,454 | 27 | 1.87 | |||||||||||||||||||||||||||
Long-term debt | 14,236 | 176 | 1.23 | 14,523 | 178 | 1.22 | 13,032 | 197 | 1.51 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-bearing liabilities | 112,557 | 271 | 0.24 | 113,690 | 270 | 0.24 | 118,242 | 327 | 0.28 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Net | 4,990 | 438 | 0.36 | 7,473 | 390 | 0.30 | 10,823 | 381 | 0.27 | |||||||||||||||||||||||||||
|
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|
|
|
|
|
|
| |||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks | 6,639 | 38 | 0.57 | 7,671 | 48 | 0.63 | 8,363 | 94 | 1.13 | |||||||||||||||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 10,465 | 50 | 0.48 | 9,213 | 79 | 0.85 | 9,251 | 132 | 1.43 | |||||||||||||||||||||||||||
Trading account assets | 11,602 | 135 | 1.16 | 10,335 | 136 | 1.31 | 10,821 | 152 | 1.41 | |||||||||||||||||||||||||||
Investments | 3,058 | 102 | 3.34 | 3,915 | 87 | 2.24 | 3,544 | 77 | 2.18 | |||||||||||||||||||||||||||
Loans | 24,279 | 466 | 1.92 | 25,412 | 499 | 1.96 | 24,822 | 599 | 2.41 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-earning assets | 56,043 | 791 | 1.41 | 56,546 | 849 | 1.50 | 56,801 | 1,054 | 1.86 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Deposits | 20,958 | 154 | 0.73 | 23,173 | 214 | 0.92 | 24,567 | 323 | 1.32 | |||||||||||||||||||||||||||
Short-term borrowings(1) | 18,982 | 58 | 0.31 | 17,112 | 109 | 0.63 | 16,385 | 222 | 1.35 | |||||||||||||||||||||||||||
Trading account liabilities | 1,195 | 8 | 0.69 | 1,049 | 7 | 0.71 | 1,235 | 14 | 1.16 | |||||||||||||||||||||||||||
Long-term debt | 1,441 | 4 | 0.26 | 655 | 2 | 0.32 | 732 | 4 | 0.49 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-bearing liabilities | 42,576 | 224 | 0.53 | 41,989 | 332 | 0.79 | 42,919 | 563 | 1.31 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Net | 13,467 | 567 | 0.88 | 14,557 | 517 | 0.71 | 13,882 | 491 | 0.55 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total: | ||||||||||||||||||||||||||||||||||||
Total interest-earning assets | 173,590 | 1,500 | 0.86 | 177,709 | 1,509 | 0.85 | 185,866 | 1,762 | 0.95 | |||||||||||||||||||||||||||
Total interest-bearing liabilities | 155,133 | 495 | 0.32 | 155,679 | 602 | 0.39 | 161,161 | 890 | 0.55 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Net | ¥ | 18,457 | ¥ | 1,005 | 0.54 | ¥ | 22,030 | ¥ | 907 | 0.46 | ¥ | 24,705 | ¥ | 872 | 0.40 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
2020:
Fiscal years ended March 31, | ||||||||||||||||||||||||
2019 | 2020 | |||||||||||||||||||||||
Average balance | Interest amount | Interest rate | Average balance | Interest amount | Interest rate | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Interest-bearing deposits in other banks | ¥ | 38,914 | ¥ | 26 | 0.07 | % | ¥ | 34,333 | ¥ | 26 | 0.08 | % | ||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 6,201 | 32 | 0.51 | 9,322 | 27 | 0.30 | ||||||||||||||||||
Trading account assets | 5,930 | 71 | 1.19 | 7,753 | 72 | 0.93 | ||||||||||||||||||
Investments | 20,109 | 137 | 0.68 | 16,532 | 85 | 0.51 | ||||||||||||||||||
Loans | 55,897 | 531 | 0.95 | 54,777 | 535 | 0.98 | ||||||||||||||||||
Total interest-earning assets | 127,051 | 797 | 0.63 | 122,717 | 745 | 0.61 | ||||||||||||||||||
Deposits | 87,168 | 94 | 0.11 | 87,143 | 90 | 0.10 | ||||||||||||||||||
Short-term borrowings (1) | 14,011 | 69 | 0.49 | 10,918 | 63 | 0.58 | ||||||||||||||||||
Trading account liabilities | 1,735 | 34 | 1.93 | 1,591 | 41 | 2.59 | ||||||||||||||||||
Long-term debt | 12,285 | 217 | 1.77 | 9,631 | 198 | 2.05 | ||||||||||||||||||
Total interest-bearing liabilities | 115,199 | 414 | 0.36 | 109,283 | 392 | 0.36 | ||||||||||||||||||
Net | 11,852 | 383 | 0.27 | 13,434 | 353 | 0.25 | ||||||||||||||||||
Foreign: | ||||||||||||||||||||||||
Interest-bearing deposits in other banks | 5,951 | 95 | 1.59 | 5,716 | 79 | 1.39 | ||||||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 9,924 | 228 | 2.30 | 11,301 | 249 | 2.21 | ||||||||||||||||||
Trading account assets | 9,197 | 141 | 1.53 | 8,859 | 150 | 1.69 | ||||||||||||||||||
Investments | 4,471 | 95 | 2.13 | 4,096 | 81 | 1.98 | ||||||||||||||||||
Loans | 28,037 | 851 | 3.03 | 28,827 | 846 | 2.94 | ||||||||||||||||||
Total interest-earning assets | 57,580 | 1,410 | 2.45 | 58,799 | 1,405 | 2.39 | ||||||||||||||||||
Deposits | 26,693 | 519 | 1.95 | 27,507 | 526 | 1.91 | ||||||||||||||||||
Short-term borrowings (1) | 15,094 | 357 | 2.37 | 15,112 | 334 | 2.21 | ||||||||||||||||||
Trading account liabilities | 1,249 | 16 | 1.29 | 1,009 | 12 | 1.16 | ||||||||||||||||||
Long-term debt | 701 | 7 | 0.95 | 678 | 7 | 1.13 | ||||||||||||||||||
Total interest-bearing liabilities | 43,737 | 899 | 2.06 | 44,306 | 879 | 1.98 | ||||||||||||||||||
Net | 13,843 | 511 | 0.39 | 14,493 | 526 | 0.41 | ||||||||||||||||||
Total: | ||||||||||||||||||||||||
Total interest-earning assets | 184,631 | 2,207 | 1.20 | 181,516 | 2,150 | 1.19 | ||||||||||||||||||
Total interest-bearing liabilities | 158,936 | 1,313 | 0.83 | 153,589 | 1,271 | 0.83 | ||||||||||||||||||
Net | ¥ | 25,695 | ¥ | 894 | 0.37 | ¥ | 27,927 | ¥ | 879 | 0.36 | ||||||||||||||
(1) | Short-term borrowings consist of due to trust accounts, call money and funds purchased, payables under repurchase agreements and securities lending transactions and other short-term borrowings. |
2019
2020.
Interest and dividend income increased by ¥9 billion, or 0.6%, from the previous fiscal year to ¥1,509 billion in the fiscal year ended March 31, 2017. Domestic interest and dividend income accounted for ¥660 billion of the total amount, a decrease of ¥49 billion from the previous fiscal year, and foreign interest and dividend income accounted for ¥849 billion, an increase of ¥58 billion from the previous fiscal year.
Due to the monetary policies of the Bank of Japan, such as continuous monetary easing and the negative interest rate policy that began in February 2016, our domestic loan and deposit rate margin has become narrower. Reflecting a decline in short-term interest rate levels of the yen, the average yield on domestic loans decreased by 0.12 percentage points from the previous fiscal year to 0.95% in the fiscal year ended March 31, 2017, and the average rate on domestic interest-bearing deposits decreased by 0.01 percentage points from the previous fiscal year to 0.06% in the fiscal year ended March 31, 2017. Our domestic funding structure is stable, primarily consisting of individual customer deposits. The average yield on foreign loans increased by 0.04 percentage points from the previous fiscal year to 1.96% in the fiscal year ended March 31, 2017, and the average rate on foreign interest-bearing deposits increased by 0.19 percentage points from the previous fiscal year to 0.92% in the fiscal year ended March 31, 2017. We place further emphasis on the importance of profitability in the lending business and look to counter the effects of negative impact of negative interest rates and others.
The decrease in domestic interest and dividend income was due mainly to a decrease in interest income from domestic loans. The decrease in interest income from domestic loans was due mainly to a decrease in the average yield, reflecting a decline in yen interest rate levels. Changes in the average yields on domestic interest-earning assets contributed to an overall decrease in interest and dividend income of ¥46 billion, and changes in the average balances of domestic interest-earning assets contributed to an overall decrease in interest and dividend income of ¥3 billion, resulting in the ¥49 billion decrease in domestic interest and dividend income.
The increase in foreign interest and dividend income was due mainly to increases in interest income from foreign loans and in interest income from foreign call loans and funds sold, and receivable under resale agreements and securities borrowing transactions. The increase in interest income from foreign loans was due mainly to an increase in the average balance as well as an increase in the average yields. The increase in interest income from foreign call loans and funds sold, and receivable under resale agreements and securities borrowing transactions was due mainly to an increase in the average yield. Changes in the average yields on foreign interest-earning assets contributed to an overall increase in interest and dividend income of ¥31 billion, and changes in the average balance of foreign interest-earning assets contributed to an overall increase of ¥27 billion, resulting in the ¥58 billion increase in foreign interest and dividend income.
Interest expense increased by ¥107 billion, or 21.6%, from the previous fiscal year to ¥602 billion in the fiscal year ended March 31, 2017. Domestic interest expense accounted for ¥270 billion of the total amount, a decrease of ¥1 billion from the previous fiscal year, and foreign interest expense accounted for ¥332 billion of the total amount, an increase of ¥108 billion from the previous fiscal year.
The changes in the average interest rates on domestic interest-bearing liabilities contributed to an overall decrease in interest expense of ¥3 billion, and the changes in the average balance of domestic interest-bearing liabilities contributed to an overall increase in interest expense of ¥2 billion, resulting in the ¥1 billion decrease in domestic interest expense.
The increase in foreign interest expense was due mainly to increases in interest expense on foreign deposits and foreign short-term borrowings. The increase in foreign interest expense on foreign deposits was due mainly to an increase in the average rates, reflecting a rise in short-term interest rate levels of the U.S. dollar as well as an increase in the average balance of foreign deposits. The increase in foreign interest expense on foreign short-term borrowings was due mainly to an increase in the average rates, reflecting a rise in short-term interest rate levels of the U.S. dollar. The changes in the average interest rates on foreign interest-bearing liabilities
contributed to an overall increase in interest expense of ¥99 billion, and the changes in the average balance of foreign interest-bearing liabilities contributed to an overall increase in interest expense of ¥9 billion, resulting in the ¥108 billion increase in foreign interest expense.
As a result of the foregoing, net interest income decreased by ¥98 billion, or 9.8%, from the previous fiscal year to ¥907 billion. The average interest rate spread declined by 0.08 percentage points from the previous fiscal year to 0.46% in the fiscal year ended March 31, 2017. The decline of the average interest rate spread was not significant because both the average yields on total interest-earning assets and the average interest rates on total interest-bearing liabilities generally leveled out between these periods.
Provision (Credit) for Loan Losses
Fiscal Year Ended March 31, 2018 Compared to Fiscal Year Ended March 31, 2017
We recorded a credit for loan losses of ¥126 billion in the fiscal year ended March 31, 2018 compared to a provision for loan losses of ¥38 billion in the fiscal year ended March 31, 2017. The change was due mainly to improvements in the credit condition of some borrowers in the domestic manufacturing industry as well as the gradual recovery in the economic environment.
Fiscal Year Ended March 31, 2017 Compared to Fiscal Year Ended March 31, 2016
Provision for loan losses increased by ¥3¥124 billion from March 31, 20162019 to ¥38¥156 billion at March 31, 2017. Although obligor categories improved as a whole, reflecting the gradual recovery in the economic environment, provision for loan losses increased2020. The increase was due mainly to reflection of the impact of
Fiscal years ended March 31, | ||||||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Fee and commission | ¥ | 805 | ¥ | 826 | ¥ | 866 | ||||||
Fee and commission from securities-related business | 176 | 166 | 180 | |||||||||
Fee and commission from deposits and lending business | 144 | 165 | 156 | |||||||||
Fee and commission from remittance business | 110 | 108 | 110 | |||||||||
Fee and commission from asset management business | 62 | 79 | 101 | |||||||||
Trust fees | 50 | 47 | 52 | |||||||||
Fees for other customer services | 263 | 261 | 267 | |||||||||
Foreign exchange gains (losses)—net | 114 | 69 | 92 | |||||||||
Trading account gains (losses)—net | 559 | (42 | ) | 237 | ||||||||
Investment gains (losses)—net | 264 | 333 | 297 | |||||||||
Investment gains (losses) related to bonds | 66 | 61 | 7 | |||||||||
Investment gains (losses) related to equity securities | 192 | 272 | 283 | |||||||||
Others | 6 | — | 7 | |||||||||
Equity in earnings (losses) of equity method investees—net | 29 | 27 | 24 | |||||||||
Gains on disposal of premises and equipment | 10 | 6 | 8 | |||||||||
Other noninterest income | 103 | 149 | 81 | |||||||||
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Total noninterest income | ¥ | 1,884 | ¥ | 1,368 | ¥ | 1,605 | ||||||
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2020:
Fiscal years ended March 31, | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Fee and commission | ¥ | 853 | ¥ | 868 | ||||
Fee and commission from deposits and lending business | 152 | 158 | ||||||
Fee and commission from securities-related business | 145 | 139 | ||||||
Fee and commission from trust related business | 125 | 129 | ||||||
Fee and commission from remittance business | 110 | 112 | ||||||
Fee and commission from asset management business | 98 | 99 | ||||||
Fee and commission from agency business | 36 | 32 | ||||||
Fee and commission from guarantee related business | 29 | 29 | ||||||
Fees for other customer services | 158 | 170 | ||||||
Foreign exchange gains (losses)—net | 94 | 44 | ||||||
Trading account gains (losses)—net | 329 | 746 | ||||||
Investment gains (losses)—net | (160 | ) | (526 | ) | ||||
Debt securities | (4 | ) | 31 | |||||
Equity securities | (156 | ) | (557 | ) | ||||
Equity in earnings (losses) of equity method investees—net | 29 | 34 | ||||||
Gains on disposal of premises and equipment | 5 | 3 | ||||||
Other noninterest income | 72 | 139 | ||||||
Total noninterest income | ¥ | 1,222 | ¥ | 1,308 | ||||
2019
compared to trading account losses—net of ¥42 billion in the previous fiscal year, offset in part by a decrease in other noninterest income of ¥68 billion and a decrease in investment gains—net of ¥36 billion.
Fee and commission
Fee and commission increased by ¥40 billion, or 4.8%, from the previous fiscal year to ¥866 billion in the fiscal year ended March 31, 2018.2020. The increase was due mainly to an increase in fee and commission from asset management businesstrading account gains—net of ¥22¥417 billion, or 27.8%, and fee and commission from securities-related business of ¥14 billion, or 8.4%. The increaseoffset in fee and commission from asset management business was due mainly topart by an increase in fees related to investment trust management and investment advisory management businesses. The increase in feelosses—net of ¥366 billion.
Foreign exchange gains (losses)—net
Foreign exchange gains—net
Trading account gains (losses)—net
Trading account gains (losses)—net was a gain of ¥237 billion in the fiscal year ended March 31, 2018 compared to a loss of ¥42 billion in the previous fiscal year. The increase in trading account gains (losses)—net was due mainly to an increase in gains related to changes in the fair value of foreign currency-denominated securities for which the fair value option was elected. Long-term interest rates rose and unrealized losses of fair value increased during the previous fiscal year. The fluctuation range of long-term interest rates narrowed, unrealized losses decreased, and unrealized profit increased.
For further information on the fair value option, see note 28 to our consolidated financial statements included elsewhere in this annual report.
Investment gains (losses)—net
Investment gains—net decreased by ¥36 billion, or 10.8 %, from the previous fiscal year to ¥297 billion in the fiscal year ended March 31, 2018. The decrease was due mainly to a decrease in investment gains related to bonds of ¥54 billion, or 88.5%, from the fiscal year to ¥7 billion in the fiscal year ended March 31, 2018. The decrease in investment gains related to bonds was due mainly to a decrease in gains on sales of investment account bonds and an increase in losses on sales of investment account bonds in the fiscal year ended March 31, 2018.
Fiscal Year Ended March 31, 2017 Compared to Fiscal Year Ended March 31, 2016
Noninterest income decreased by ¥516 billion, or 27.4%, from the previous fiscal year to ¥1,368 billion in the fiscal year ended March 31, 2017. The decrease was due mainly to trading account losses—net of ¥42 billion compared to trading account gains—net of ¥559 billion in the previous fiscal year, offset in part by an increase in investment gains—net of ¥69 billion.
Fee and commission
Fee and commission increased by ¥21 billion, or 2.6%, from the previous fiscal year to ¥826 billion in the fiscal year ended March 31, 2017.2020. The increase was due mainly to an increase in fee and commission from deposits and lending business of ¥21¥6 billion, or 3.9%, offset in part by a decrease in fee and commission from securities-related business of ¥10 billion.
2020.
Investment gains (losses)—net
Investment gains—net increased by ¥69 billion, or 26.1 %, from the previous fiscal year to ¥333 billion in the fiscal year ended March 31, 2017. The increase was due mainly to an increase in investment gains related to equity securities of ¥80 billion, or 41.7%, from the fiscal year to ¥272 billion in the fiscal year ended March 31, 2017. The increase in investment gains related to equity securities was due mainly to an increase in gains on sales of investment account equity securities in the fiscal year ended March 31, 2017, reflecting our continued efforts to decrease our cross-shareholdings. We continue our reallocation of management resources to key strategies while mitigating the risk of stock price fluctuation.
Fiscal years ended March 31, | ||||||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Salaries and employee benefits | ¥ | 634 | ¥ | 663 | ¥ | 688 | ||||||
General and administrative expenses | 548 | 571 | 586 | |||||||||
Impairment of goodwill | 6 | — | — | |||||||||
Occupancy expenses | 196 | 195 | 192 | |||||||||
Fee and commission expenses | 164 | 177 | 189 | |||||||||
Provision (credit) for losses onoff-balance-sheet instruments | (16 | ) | 19 | (30 | ) | |||||||
Other noninterest expenses | 125 | 132 | 139 | |||||||||
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Total noninterest expenses | ¥ | 1,657 | ¥ | 1,757 | ¥ | 1,764 | ||||||
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2020:
Fiscal years ended March 31, | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Salaries and employee benefits | ¥ | 683 | ¥ | 677 | ||||
General and administrative expenses | 762 | 649 | ||||||
Occupancy expenses | 208 | 215 | ||||||
Fee and commission expenses | 190 | 194 | ||||||
Provision (credit) for losses on off-balance-sheet instruments | (9 | ) | 19 | |||||
Other noninterest expenses | 165 | 124 | ||||||
Total noninterest expenses | ¥ | 1,999 | ¥ | 1,878 | ||||
2019
We will continue to aim to achieve sustainable growth of the group looking ahead ten years and to secure future competitive superiority. These efforts include organization and personnel optimization, system structural reform, channel reconstruction and strengthening of earnings.
Salaries and employee benefits
Salaries and employee benefits increased by ¥25 billion, or 3.8%, from the previous fiscal year to ¥688 billion in the fiscal year ended March 31, 2018 due mainly to an increase in personnel expenses reflecting an increase in domestic personnel and an increase in bonuses at overseas branches. Additional information regarding pension and other employee benefit plans is included in note 21 to our consolidated financial statements included elsewhere in this annual report.
Provision (credit) for losses onoff-balance-sheet instruments
Provision (credit) for losses onoff-balance-sheet instruments was a credit of ¥30 billion in the fiscal year ended March 31, 2018 compared to a provision of ¥19 billion in the previous fiscal year. The change was due mainly to an increase in reversal of allowance for losses on guarantees.
Fiscal Year Ended March 31, 2017 Compared to Fiscal Year Ended March 31, 2016
Noninterest expenses increased by ¥100 billion, or 6.0%, from the previous fiscal year to ¥1,757 billion in the fiscal year ended March 31, 2017. The increase was due mainly to provision for losses onoff-balance-sheetinstruments of ¥19 billion compared to credit for losses on¥16¥9 billion in the previous fiscal year, an increase in salaries and employee benefits of ¥29 billion and an increase in generalyear.
As the result of an increase in
Salaries and employee benefits
Salaries and employee benefits increased by ¥29¥113 billion, or 4.6%14.8%, from the previous fiscal year to ¥663¥649 billion in the fiscal year ended March 31, 2017 due mainly2020. Depreciation of the next-generation IT systems started from the previous fiscal year. In the previous fiscal year, the software related to an increase in personnel expenses and an increase in employee retirement benefit expenses. The increase in personnel expensesthe system migration, which is related to the next-generation IT systems, was due mainly to an increase in domestic personnel expenses. The increase in employee retirement benefit expensesimmediately depreciated. There was due mainly to an increaseno such charge in the amortization of net actuarial losses. Additional information regarding pension and other employee benefit plans is included in note 21 to our consolidated financial statements included elsewhere in this annual report.
fiscal year ended March 31, 2020.
Fiscal years ended March 31, | ||||||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Current: | ||||||||||||
Domestic | ¥ | 163 | ¥ | 130 | ¥ | 130 | ||||||
Foreign | 61 | 68 | 47 | |||||||||
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Total current tax expense | 224 | 198 | 177 | |||||||||
Deferred: | ||||||||||||
Domestic | 127 | (100 | ) | 58 | ||||||||
Foreign | (4 | ) | (7 | ) | 2 | |||||||
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Total deferred tax expense (benefit) | 123 | (107 | ) | 60 | ||||||||
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Total income tax expense | ¥ | 347 | ¥ | 91 | ¥ | 237 | ||||||
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2020:
Fiscal years ended March 31, | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Current: | ||||||||
Domestic | ¥ | 116 | ¥ | 96 | ||||
Foreign | 50 | 53 | ||||||
Total current tax expense | 166 | 149 | ||||||
Deferred: | ||||||||
Domestic | (162 | ) | (111 | ) | ||||
Foreign | 5 | 9 | ||||||
Total deferred tax expense (benefit) | (157 | ) | (102 | ) | ||||
Total income tax expense | ¥ | 9 | ¥ | 47 | ||||
2019
As of March 31, | ||||||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Deferred tax assets: | ||||||||||||
Investments | ¥ | 522 | ¥ | 498 | ¥ | 454 | ||||||
Allowance for loan losses | 179 | 184 | 127 | |||||||||
Derivative financial instruments | — | 14 | 53 | |||||||||
Premises and equipment | — | 4 | 5 | |||||||||
Trading securities | — | 31 | 2 | |||||||||
Net operating loss carryforwards | 342 | 452 | 178 | |||||||||
Other | 170 | 190 | 204 | |||||||||
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Gross deferred tax assets | 1,213 | 1,373 | 1,023 | |||||||||
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Valuation allowance | (340 | ) | (438 | ) | (163 | ) | ||||||
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Deferred tax assets, net of valuation allowance | 873 | 935 | 860 | |||||||||
Deferred tax liabilities: | ||||||||||||
Available-for-sale securities | 711 | 724 | 764 | |||||||||
Prepaid pension cost and accrued pension liabilities | 175 | 195 | 255 | |||||||||
Undistributed earnings of subsidiaries | 12 | 17 | 15 | |||||||||
Derivative financial instruments | 57 | — | — | |||||||||
Trading securities | 23 | — | — | |||||||||
Premises and equipment | 1 | — | — | |||||||||
Other | 39 | 75 | 75 | |||||||||
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Gross deferred tax liabilities | 1,018 | 1,011 | 1,109 | |||||||||
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Net deferred tax assets (liabilities) | ¥ | (145 | ) | ¥ | (76 | ) | ¥ | (249 | ) | |||
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2020:
As of March 31, | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Deferred tax assets: | ||||||||
Lease liabilities | ¥ | — | ¥ | 192 | ||||
Allowance for loan losses | 123 | 166 | ||||||
Premises and equipment | 74 | 78 | ||||||
Available-for-sale securities | — | 6 | ||||||
Derivative financial instruments | 48 | 5 | ||||||
Investments | — | 4 | ||||||
Net operating loss carryforwards | 168 | 163 | ||||||
Other | 216 | 201 | ||||||
Gross deferred tax assets | 629 | 815 | ||||||
Valuation allowance | (158 | ) | (165 | ) | ||||
Deferred tax assets, net of valuation allowance | 471 | 650 | ||||||
Deferred tax liabilities: | ||||||||
Prepaid pension cost and accrued pension liabilities | 248 | 203 | ||||||
ROU assets | — | 189 | ||||||
Trading securities | 9 | 58 | ||||||
Investments | 198 | — | ||||||
Available-for-sale securities | 12 | — | ||||||
Other | 62 | 89 | ||||||
Gross deferred tax liabilities | 529 | 539 | ||||||
Net deferred tax assets (liabilities) | ¥ | (58 | ) | ¥ | 111 | |||
2019
2020.
Net income (loss) attributable to noncontrolling interests increased by ¥27 billion from the previous fiscal year to ¥27 billion in the fiscal year ended March 31, 2017.
Net Income Attributable to MHFG Shareholders
Fiscal Year Ended March 31, 2018 Compared to Fiscal Year Ended March 31, 2017
2019
Fiscal Year Ended2020.
As a result of2019 and 2020. For the foregoing, net income attributable to MHFG shareholders decreased by ¥488 billion, or 57.4%, from the previous fiscal year to ¥362 billion indiscussion on our business segment analysis for the fiscal year ended March 31, 2017.
2019, including certain comparative discussion on our operating results for the fiscal years ended March 31, 2018 and 2019, please refer to “Item 5. Operating and Financial Review and Prospects—Business Segments Analysis
Segment Analysis” in our annual report on Form
In line with the aforementioned system, we changed the reportable segments from those based on the relevant principal consolidated subsidiaries to the fivein-house companies.
Mizuho Financial Group (Consolidated) | ||||||||||||||||||||||||||||
Fiscal year ended March 31, 2016(3): | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others(2)(4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | ¥ | 754.8 | ¥ | 425.0 | ¥ | 400.6 | ¥ | 577.7 | ¥ | 51.0 | ¥ | 12.5 | ¥ | 2,221.6 | ||||||||||||||
General and administrative expenses | 702.4 | 187.0 | 236.2 | 170.4 | 28.1 | 20.9 | 1,345.0 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 20.9 | 1.2 | 0.2 | — | 1.1 | 0.8 | 24.2 | |||||||||||||||||||||
Others | — | — | — | — | — | (48.0 | ) | (48.0 | ) | |||||||||||||||||||
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Net business profits (losses)(1) | ¥ | 73.3 | ¥ | 239.2 | ¥ | 164.6 | ¥ | 407.3 | ¥ | 24.0 | ¥ | (55.6 | ) | ¥ | 852.8 | |||||||||||||
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Mizuho Financial Group (Consolidated) | ||||||||||||||||||||||||||||
Fiscal year ended March 31, 2017: | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others(2)(4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | ¥ | 717.2 | ¥ | 434.1 | ¥ | 358.3 | ¥ | 539.9 | ¥ | 48.9 | ¥ | (5.7 | ) | ¥ | 2,092.7 | |||||||||||||
General and administrative expenses | 719.7 | 194.0 | 244.3 | 193.8 | 29.3 | 39.4 | 1,420.5 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 14.9 | 1.0 | 1.0 | — | 0.4 | 1.6 | 18.9 | |||||||||||||||||||||
Others | — | — | — | — | — | (27.7 | ) | (27.7 | ) | |||||||||||||||||||
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Net business profits (losses)(1) | ¥ | 12.4 | ¥ | 241.1 | ¥ | 115.0 | ¥ | 346.1 | ¥ | 20.0 | ¥ | (71.2 | ) | ¥ | 663.4 | |||||||||||||
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Mizuho Financial Group (Consolidated) | ||||||||||||||||||||||||||||
Fiscal year ended March 31, 2019 (5) : | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits + Net gains (losses) related to ETFs and others (1) | ¥ | 705.9 | ¥ | 473.4 | ¥ | 400.3 | ¥ | 192.4 | ¥ | 49.6 | ¥ | 6.1 | ¥ | 1,827.7 | ||||||||||||||
General and administrative expenses (2) | 713.5 | 205.7 | 237.9 | 207.5 | 27.3 | 48.7 | 1,440.6 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 18.1 | 0.9 | 7.2 | — | 1.3 | 23.7 | 51.2 | |||||||||||||||||||||
Amortization of goodwill and others | 0.4 | 0.4 | 0.4 | 2.3 | 8.0 | 2.1 | 13.6 | |||||||||||||||||||||
Others | — | — | — | — | — | (16.3 | ) | (16.3 | ) | |||||||||||||||||||
Net business profits (losses) (3) + Net gains (losses) related to ETFs and others | ¥ | 10.1 | ¥ | 268.2 | ¥ | 169.2 | ¥ | (17.4 | ) | ¥ | 15.6 | ¥ | (37.3 | ) | ¥ | 408.4 | ||||||||||||
Fixed assets (6) | ¥ | 499.3 | ¥ | 225.8 | ¥ | 176.9 | ¥ | 92.6 | ¥ | 0.1 | ¥ | 662.5 | ¥ | 1,657.2 | ||||||||||||||
Mizuho Financial Group (Consolidated) | ||||||||||||||||||||||||||||
Fiscal year ended March 31, 2018: | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others(2) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | ¥ | 726.2 | ¥ | 433.0 | ¥ | 352.6 | ¥ | 381.7 | ¥ | 50.2 | ¥ | (28.3 | ) | ¥ | 1,915.4 | |||||||||||||
General and administrative expenses | 723.3 | 197.7 | 254.8 | 200.9 | 27.6 | 53.8 | 1,458.1 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 12.7 | 1.0 | 2.4 | — | 3.1 | 2.3 | 21.5 | |||||||||||||||||||||
Others | — | — | — | — | — | (21.0 | ) | (21.0 | ) | |||||||||||||||||||
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Net business profits (losses)(1) | ¥ | 15.6 | ¥ | 236.3 | ¥ | 100.2 | ¥ | 180.8 | ¥ | 25.7 | ¥ | (100.8 | ) | ¥ | 457.8 | |||||||||||||
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Mizuho Financial Group (Consolidated) | ||||||||||||||||||||||||||||
Fiscal year ended March 31, 2020: | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits + Net gains (losses) related to ETFs and others (1) | ¥ | 673.6 | ¥ | 462.4 | ¥ | 417.8 | ¥ | 410.1 | ¥ | 48.4 | ¥ | 60.5 | ¥ | 2,072.8 | ||||||||||||||
General and administrative expenses (2) | 668.5 | 215.1 | 249.0 | 208.9 | 29.0 | 41.0 | 1,411.5 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 11.8 | 2.0 | 10.3 | — | 1.3 | 5.0 | 30.4 | |||||||||||||||||||||
Amortization of goodwill and others | 0.4 | 0.4 | 0.4 | 2.3 | 7.8 | 1.9 | 13.2 | |||||||||||||||||||||
Others | — | — | — | — | — | (5.9 | ) | (5.9 | ) | |||||||||||||||||||
Net business profits (losses) (3) + Net gains (losses) related to ETFs and others | ¥ | 16.5 | ¥ | 248.9 | ¥ | 178.7 | ¥ | 198.9 | ¥ | 12.9 | ¥ | 16.7 | ¥ | 672.6 | ||||||||||||||
Fixed assets (6) | ¥ | 503.7 | ¥ | 204.1 | ¥ | 173.0 | ¥ | 91.5 | ¥ | 0.1 | ¥ | 767.4 | ¥ | 1,739.8 | ||||||||||||||
(1) | “Gross profits + Net gains (losses) related to ETFs and others” is reported instead of sales reported by general corporations. Gross profits is defined as the sum of net interest income, fiduciary income, net fee and commission income, net trading income and net other operating income. Net gains (losses) related to ETFs and others consist of net gains (losses) on ETFs held by Mizuho Bank and Mizuho Trust & Banking on their non-consolidated basis and net gains (losses) on operating investment securities of Mizuho Securities on its consolidated basis. For the fiscal years ended March 31, 2019 and 2020, net gains (losses) related to ETFs and others amounted to ¥15.0 billion and ¥10.6 billion, respectively, of which ¥7.3 billion and ¥7.3 billion are included in “Global Markets Company,” respectively. |
(2) | “General and administrative expenses” excludes non-allocated gains (losses), net. |
(3) | Net business profits (losses) is used in Japan as a measure of the profitability of core banking operations, and is defined as gross profits |
“Others” includes |
(5) | Income and expenses of foreign branches of Mizuho Bank and foreign subsidiaries with functional currencies other than Japanese Yen have been translated for purposes of segment reporting using the budgeted foreign currency rates. Prior period comparative amounts for such foreign currency income and expenses have been translated using current period budgeted foreign currency rates. |
(6) | “Fixed assets” is presented based on Japanese GAAP and corresponds to the total amount of the following U.S. GAAP accounts: Premises and equipment-net; Goodwill; Intangible assets; andright-of-use assets related to operating leases included in Other assets. The above table does not include other asset amounts because “Fixed assets” is the only balance sheet metric that management uses when evaluating and making decisions pertaining to the operating segments. “Fixed assets” has been allocated to each segment |
and |
2019 revenue. loan interest income and debt capital markets-related revenue.20182020 Compared to Fiscal Year Ended March 31, 201720182020 were ¥726.2¥673.6 billion, an increasea decrease of ¥9.0¥32.3 billion, or 1.3%4.6%, compared to the fiscal year ended March 31, 2017.2019. The increasedecrease was attributable mainly to an increase ofnon-interestdecreases in net interest income such as solution-related revenue and asset management-related revenue which more than offset a decrease of interest income.2018 increased2020 decreased by ¥3.6¥45.0 billion, or 0.5%6.3%, compared to the fiscal year ended March 31, 20172019 to ¥723.3¥668.5 billion.As The decrease was attributable mainly to the implementation in the previous fiscal year of our structural reform initiatives which led to a result, netwrite-down of certain fixed assets in such fiscal year, including software attributable to the domestic retail business profitsdivision and closing of branches.2018 increased2020 decreased by ¥3.2¥6.3 billion, or 25.8%34.8%, compared to the fiscal year ended March 31, 20172019 to ¥15.6¥11.8 billion.Corporate & Institutional CompanyGross2018 were ¥433.0 billion, a decrease of ¥1.12020 increased by ¥6.4 billion, or 0.3%63.4%, compared to the fiscal year ended March 31, 2017.2019 to ¥16.5 billion.M&Adividend income which was offset in part by increases in loan interest income and equity capital markets-relatedsolution-related revenue.20182020 increased by ¥3.7¥9.4 billion, or 1.9%4.6%, compared to the fiscal year ended March 31, 20172019 to ¥197.7¥215.1 billion.As a result, business profits for the fiscal year ended March 31, 2018 decreased2020 increased by ¥4.8¥1.1 billion, or 2.0%122.2%, compared to the fiscal year ended March 31, 20172019 to ¥236.3¥2.0 billion.Global Corporate CompanyGross2018 were ¥352.6 billion, a decrease of ¥5.72020 decreased by ¥19.3 billion, or 1.6%7.2%, compared to the fiscal year ended March 31, 2017.2019 to ¥248.9 billion.decreaseincrease was attributable mainly to the stagnation of our solution related-business such as M&Aincreases in the Americas.20182020 increased by ¥10.5¥11.1 billion, or 4.3%4.7%, compared to the fiscal year ended March 31, 20172019 to ¥254.8¥249.0 billion.As a result, business profits for the fiscal year ended March 31, 2018 decreased2020 increased by ¥14.8¥3.1 billion, or 12.9%43.1%, compared to the fiscal year ended March 31, 20172019 to ¥100.2¥10.3 billion.Global Markets CompanyGross2018 were ¥381.7 billion, a decrease of ¥158.22020 increased by ¥9.5 billion, or 29.3%5.6%, compared to the fiscal year ended March 31, 2017.2019 to ¥178.7 billion.
the effects of the restructuring of our securities portfolio in respect of past investments in foreign bonds that we conducted in the previous fiscal year.
Asset Management Company
Gross profits for the fiscal year ended March 31, 2018 were ¥50.2 billion, an increase of ¥1.3 billion, or 2.7%, compared to the fiscal year ended March 31, 2017. The increasedecrease was attributable mainly to the increasea decrease in the balance of asset formation products.
dividend income.
As a result,
Fiscal Year Ended
Retail & Business Banking Company
Gross profits2019 and 2020. For the discussion on our geographical segment analysis for the fiscal year ended March 31, 2017 were ¥717.2 billion, a decrease of ¥37.6 billion, or 5.0%, compared to2019, including certain comparative discussion on our operating results for the fiscal yearyears ended March 31, 2016. The decrease was attributable mainly2018 and 2019, please refer to a decrease of net interest income as a result of the effects of the negative interest rate policy“Item 5. Operating and Financial Review and Prospects—Geographical Segment Analysis” in Japan and a decrease in income related to investment products.
General and administrative expenses our annual report on Form
As a result, net business profits for the fiscal year ended March 31, 2017 decreased by ¥60.9 billion, or 83.1%, compared to the fiscal year ended March 31, 2016 to ¥12.4 billion.
Corporate & Institutional Company
Gross profits for the fiscal year ended March 31, 2017 were ¥434.1 billion, an increase
Americas | Asia/Oceania excluding Japan, and others | |||||||||||||||||||||||
Japan | United | Others | Europe | Total | ||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Fiscal year ended March 31, 2016: | ||||||||||||||||||||||||
Total revenue(1) | ¥ | 2,288 | ¥ | 434 | ¥ | 46 | ¥ | 188 | ¥ | 428 | ¥ | 3,384 | ||||||||||||
Total expenses(2) | 1,534 | 282 | 29 | 126 | 216 | 2,187 | ||||||||||||||||||
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Income before income tax expense | 754 | 152 | 17 | 62 | 212 | 1,197 | ||||||||||||||||||
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Net income | ¥ | 465 | ¥ | 137 | ¥ | 15 | ¥ | 51 | ¥ | 182 | ¥ | 850 | ||||||||||||
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Total assets at end of fiscal year | ¥ | 133,156 | ¥ | 28,985 | ¥ | 4,228 | ¥ | 11,617 | ¥ | 15,824 | ¥ | 193,810 | ||||||||||||
Fiscal year ended March 31, 2017: | ||||||||||||||||||||||||
Total revenue(1) | ¥ | 1,748 | ¥ | 500 | ¥ | 70 | ¥ | 191 | ¥ | 368 | ¥ | 2,877 | ||||||||||||
Total expenses(2) | 1,712 | 303 | 29 | 136 | 216 | 2,396 | ||||||||||||||||||
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Income before income tax expense | 36 | 197 | 41 | 55 | 152 | 481 | ||||||||||||||||||
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Net income | ¥ | 6 | ¥ | 168 | ¥ | 39 | ¥ | 39 | ¥ | 137 | ¥ | 389 | ||||||||||||
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Total assets at end of fiscal year | ¥ | 138,832 | ¥ | 30,262 | ¥ | 4,203 | ¥ | 10,629 | ¥ | 16,530 | ¥ | 200,456 | ||||||||||||
Fiscal year ended March 31, 2018: | ||||||||||||||||||||||||
Total revenue(1) | ¥ | 2,003 | ¥ | 655 | ¥ | 64 | ¥ | 197 | ¥ | 448 | ¥ | 3,367 | ||||||||||||
Total expenses(2) | 1,583 | 479 | 38 | 173 | 255 | 2,528 | ||||||||||||||||||
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Income before income tax expense | 420 | 176 | 26 | 24 | 193 | 839 | ||||||||||||||||||
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Net income | ¥ | 231 | ¥ | 153 | ¥ | 24 | ¥ | 21 | ¥ | 173 | ¥ | 602 | ||||||||||||
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Total assets at end of fiscal year | ¥ | 142,588 | ¥ | 28,136 | ¥ | 4,380 | ¥ | 11,678 | ¥ | 17,474 | ¥ | 204,256 |
Americas | Asia/Oceania excluding Japan, and others | |||||||||||||||||||||||
Japan | United States | Others | Europe | Total | ||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Fiscal year ended March 31, 2019: | ||||||||||||||||||||||||
Total revenue (1) | ¥ | 1,705 | ¥ | 792 | ¥ | 66 | ¥ | 250 | ¥ | 616 | ¥ | 3,429 | ||||||||||||
Total expenses (2) | 2,082 | 697 | 46 | 203 | 316 | 3,344 | ||||||||||||||||||
Income (loss) before income tax expense | (377 | ) | 95 | 20 | 47 | 300 | 85 | |||||||||||||||||
Net income (loss) | ¥ | (331 | ) | ¥ | 85 | ¥ | 17 | ¥ | 35 | ¥ | 270 | ¥ | 76 | |||||||||||
Total assets at end of fiscal year | ¥ | 133,443 | ¥ | 25,913 | ¥ | 4,825 | ¥ | 15,323 | ¥ | 18,107 | ¥ | 197,611 | ||||||||||||
Fiscal year ended March 31, 2020: | ||||||||||||||||||||||||
Total revenue (1) | ¥ | 1,681 | ¥ | 801 | ¥ | 95 | ¥ | 270 | ¥ | 611 | ¥ | 3,458 | ||||||||||||
Total expenses (2) | 2,009 | 679 | 41 | 239 | 337 | 3,305 | ||||||||||||||||||
Income (loss) before income tax expense | (328 | ) | 122 | 54 | 31 | 274 | 153 | |||||||||||||||||
Net income (loss) | ¥ | (313 | ) | ¥ | 100 | ¥ | 51 | ¥ | 24 | ¥ | 244 | ¥ | 106 | |||||||||||
Total assets at end of fiscal year | ¥ | 137,471 | ¥ | 34,650 | ¥ | 4,137 | ¥ | 15,487 | ¥ | 19,474 | ¥ | 211,219 |
(1) | Total revenue includes interest and dividend income and noninterest income. |
(2) | Total expenses include interest expense, provision (credit) for loan losses and noninterest expenses. |
201920182020 Compared to Fiscal Year Ended March 31, 20172018, 38.5%2020, we recorded a net loss in Japan. Among the geographical regions in which we recorded net income, 24.0% of ourthe net income was derived from Japan, 25.4% from the United States, 3.9%12.3% from the Americas excluding the United States, 3.5%5.6% from Europe and 28.7%58.1% from Asia/Oceania excluding Japan, and others. At March 31, 2018, 69.8%2020, 65.1% of total assets were allocated to Japan, 13.8%16.4% to the United States, 2.1%2.0% to the Americas excluding the United States, 5.7%7.3% to Europe and 8.6%9.2% to Asia/Oceania excluding Japan, and others.increaseddecreased by ¥255¥24 billion from the previous fiscal year due primarily to an increase in investment losses related to equity securities, offset in part by an increase in trading account gains—net. The increase in trading account gains—netinvestment losses related to equity securities was due mainly to an increase in gains
losses related to changes in the fair value of foreign currency-denominatedJapanese equity securities forin the fiscal year ended March 31, 2020, which mostly reflected the relative weakness in market conditions. The increase in trading account gains —net was due mainly to an increase in gains related to changes in the fair value option was elected.of receive-fixed,
receivables under resale agreements and loans, offset in part by a decrease in interest-bearing deposits.
and loans.
In Asia/Oceania excluding Japan, and others, total revenue increased by ¥80¥164 billion due primarily to an increase in interest income from loans. Total expenses increased by ¥39 billion due mainly to an increase in expenses on deposits. As a result, net income in Asia/Oceania excluding Japan, and others increased by ¥36 billion. Total assets in Asia/Oceania excluding Japan, and others increased by ¥944 billion due primarily to an increase in loans.
Fiscal Year Ended March 31, 2017 Compared to Fiscal Year Ended March 31, 2016
In the fiscal year ended March 31, 2017, 1.6% of our net income was derived from Japan, 43.2% from the United States, 10.0% from the Americas excluding the United States, 10.0% from Europe and 35.2% from Asia/Oceania excluding Japan, and others. At March 31, 2017, 69.3% of total assets were allocated to Japan, 15.1% to the United States, 2.1% to the Americas excluding the United States, 5.3% to Europe and 8.2% to Asia/Oceania excluding Japan, and others.
In Japan, total revenue decreased by ¥540 billion from the previous fiscal year due primarily to a decrease in trading account gains—net. The decrease in trading account gains—net was due mainly to a decrease in gains related to changes in the fair value of derivative financial instruments with interest rate swap received/fixed and paid/floating, which resulted from increases in market interest rates. Total expenses increased by ¥178 billion from the previous fiscal year due mainly to an increase in provision for loan losses. In addition, income tax expense decreased by ¥259 billion from the previous fiscal year to ¥30 billion in the fiscal year ended March 31, 2017, reflecting the decline in taxable income. As a result, net income in Japan decreased by ¥459 billion. Total assets in Japan increased by ¥5,676 billion due primarily to increases in interest-bearing deposits in other banks and domestic loans, offset in part by a decrease in investment securities.
In the United States, total revenue increased by ¥66 billion due primarily to increases in interest income from loans, resale agreements and securities lending transactions. The increase in interest income from loans and resale agreements was due mainly to an increase in market interest rates. Total expenses increased by ¥21 billion due mainly to increases in expenses on payables under resale agreements and securities lending transactions and deposits, offset in part by a decrease in provision for loan losses. As a result, net income in the United States increased by ¥31 billion. Total assets in the United States increased by ¥1,277 billion due primarily to an increase in interest-bearing deposits.
In the Americas excluding the United States, total revenue increased by ¥24 billion due primarily to an increase in other noninterest income, including foreign exchange gains (losses)—net while total expenses were flat. As a result, net income in the Americas excluding the United States increased by ¥24 billion. Total assets in the Americas excluding the United States decreased by ¥25 billion due primarily to a decrease in loans.
In Europe, total revenue increased by ¥3 billion due primarily to increases in interest from loans and trading account assets, offset in part by a decrease in other noninterest income including foreign exchange gains (losses)—net. Total expenses increased by ¥10 billion due mainly to an increase in expenses on deposits. As a result, net income in Europe decreased by ¥12 billion. Total assets in Europe decreased by ¥988 billion due primarily to a decrease in trading account assets, offset in part by an increase in interest-bearing deposits in other banks.
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Cash and due from banks | ¥ | 1,404 | ¥ | 2,325 | ¥ | 921 | ||||||
Interest-bearing deposits in other banks | 44,269 | 39,626 | (4,643 | ) | ||||||||
Call loans and funds sold | 763 | 1,007 | 244 | |||||||||
Receivables under resale agreements | 12,997 | 18,581 | 5,584 | |||||||||
Receivables under securities borrowing transactions | 2,578 | 2,216 | (362 | ) | ||||||||
Trading account assets | 21,018 | 28,093 | 7,075 | |||||||||
Investments | 24,163 | 23,676 | (487 | ) | ||||||||
Loans | 82,800 | 87,528 | 4,728 | |||||||||
Allowance for loan losses | (307 | ) | (441 | ) | (134 | ) | ||||||
Loans, net of allowance | 82,493 | 87,087 | 4,594 | |||||||||
Premises and equipment—net | 1,901 | 1,856 | (45 | ) | ||||||||
Due from customers on acceptances | 187 | 168 | (19 | ) | ||||||||
Accrued income | 343 | 324 | (19 | ) | ||||||||
Goodwill | 95 | 93 | (2 | ) | ||||||||
Intangible assets | 74 | 65 | (9 | ) | ||||||||
Deferred tax assets | 50 | 137 | 87 | |||||||||
Other assets | 5,276 | 5,965 | 689 | |||||||||
Total assets | ¥ | 197,611 | ¥ | 211,219 | ¥ | 13,608 | ||||||
Assets
Our assets as of March 31, 2017 and 2018 were as follows:
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Cash and due from banks | ¥ | 1,592 | ¥ | 1,686 | ¥ | 94 | ||||||
Interest-bearing deposits in other banks | 45,995 | 46,485 | 490 | |||||||||
Call loans and funds sold | 1,038 | 720 | (318 | ) | ||||||||
Receivables under resale agreements | 8,968 | 8,081 | (887 | ) | ||||||||
Receivables under securities borrowing transactions | 3,350 | 4,409 | 1,059 | |||||||||
Trading account assets | 24,998 | 24,303 | (695 | ) | ||||||||
Investments | 24,969 | 26,770 | 1,801 | |||||||||
Loans | 82,284 | 83,515 | 1,231 | |||||||||
Allowance for loan losses | (480 | ) | (310 | ) | 170 | |||||||
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Loans, net of allowance | 81,804 | 83,205 | 1,401 | |||||||||
Premises and equipment—net | 2,041 | 2,116 | 75 | |||||||||
Due from customers on acceptances | 184 | 213 | 29 | |||||||||
Accrued income | 271 | 301 | 30 | |||||||||
Goodwill | 95 | 95 | — | |||||||||
Intangible assets | 94 | 84 | (10 | ) | ||||||||
Deferred tax assets | 64 | 57 | (7 | ) | ||||||||
Other assets | 4,993 | 5,731 | 738 | |||||||||
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Total assets | ¥ | 200,456 | ¥ | 204,256 | ¥ | 3,800 | ||||||
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Total assets increased by ¥3,800 billion from March 31, 2017 to ¥204,256 billion as of March 31, 2018. This increase was due mainly to an increase of ¥1,801 billion in investments and an increase of ¥1,401 billion in loans, net of allowance.
Loans
As of March 31, | Increase (decrease) | |||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic(1): | ||||||||||||||||||||||||
Manufacturing | ¥ | 8,740 | 10.6 | % | ¥ | 8,156 | 9.7 | % | ¥ | (584 | ) | (0.9 | )% | |||||||||||
Construction and real estate | 7,772 | 9.4 | 8,102 | 9.7 | 330 | 0.3 | ||||||||||||||||||
Services | 4,749 | 5.8 | 5,024 | 6.0 | 275 | 0.2 | ||||||||||||||||||
Wholesale and retail | 5,140 | 6.2 | 5,113 | 6.1 | (27 | ) | (0.1 | ) | ||||||||||||||||
Transportation and communications | 3,491 | 4.2 | 3,565 | 4.3 | 74 | 0.1 | ||||||||||||||||||
Banks and other financial institutions | 4,006 | 4.9 | 4,471 | 5.3 | 465 | 0.4 | ||||||||||||||||||
Government and public institutions | 8,532 | 10.3 | 8,882 | 10.6 | 350 | 0.3 | ||||||||||||||||||
Other industries(2) | 4,427 | 5.4 | 5,018 | 6.0 | 591 | 0.6 | ||||||||||||||||||
Individuals | 10,800 | 13.1 | 10,329 | 12.4 | (471 | ) | (0.7 | ) | ||||||||||||||||
Mortgage loans | 9,960 | 12.1 | 9,445 | 11.3 | (515 | ) | (0.8 | ) | ||||||||||||||||
Other | 840 | 1.0 | 884 | 1.1 | 44 | 0.1 | ||||||||||||||||||
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Total domestic | 57,657 | 69.9 | 58,660 | 70.1 | 1,003 | 0.2 | ||||||||||||||||||
Foreign: | ||||||||||||||||||||||||
Commercial and industrial | 16,872 | 20.5 | 17,095 | 20.4 | 223 | (0.1 | ) | |||||||||||||||||
Banks and other financial institutions | 6,760 | 8.2 | 6,740 | 8.1 | (20 | ) | (0.1 | ) | ||||||||||||||||
Government and public institutions | 960 | 1.2 | 1,128 | 1.3 | 168 | 0.1 | ||||||||||||||||||
Other | 191 | 0.2 | 38 | 0.1 | (153 | ) | (0.1 | ) | ||||||||||||||||
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Total foreign | 24,783 | 30.1 | 25,001 | 29.9 | 218 | (0.2 | ) | |||||||||||||||||
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Subtotal | 82,440 | 100.0 | % | 83,661 | 100.0 | % | 1,221 | — | ||||||||||||||||
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Less: Unearned income and deferred loan fees—net | (156 | ) | (146 | ) | 10 | |||||||||||||||||||
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Total loans before allowance for loan losses | ¥ | 82,284 | ¥ | 83,515 | ¥ | 1,231 | ||||||||||||||||||
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As of March 31, | Increase (decrease) | |||||||||||||||||||||||
2019 | 2020 | |||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | ¥ | 9,554 | 11.5 | % | ¥ | 9,731 | 11.1 | % | ¥ | 177 | (0.4 | )% | ||||||||||||
Construction and real estate | 8,950 | 10.8 | 9,603 | 11.0 | 653 | 0.2 | ||||||||||||||||||
Services | 5,017 | 6.0 | 5,993 | 6.8 | 976 | 0.8 | ||||||||||||||||||
Wholesale and retail | 5,159 | 6.2 | 5,220 | 6.0 | 61 | (0.2 | ) | |||||||||||||||||
Transportation and communications | 3,693 | 4.5 | 3,833 | 4.4 | 140 | (0.1 | ) | |||||||||||||||||
Banks and other financial institutions | 4,346 | 5.2 | 4,635 | 5.3 | 289 | 0.1 | ||||||||||||||||||
Government and public institutions | 2,359 | 2.8 | 2,199 | 2.5 | (160 | ) | (0.3 | ) | ||||||||||||||||
Other industries (1) | 5,473 | 6.7 | 5,389 | 6.0 | (84 | ) | (0.7 | ) | ||||||||||||||||
Individuals | 9,858 | 11.9 | 9,428 | 10.8 | (430 | ) | (1.1 | ) | ||||||||||||||||
Mortgage loans | 8,950 | 10.8 | 8,567 | 9.8 | (383 | ) | (1.0 | ) | ||||||||||||||||
Other | 908 | 1.1 | 861 | 1.0 | (47 | ) | (0.1 | ) | ||||||||||||||||
Total domestic | 54,409 | 65.6 | 56,031 | 63.9 | 1,622 | (1.7 | ) | |||||||||||||||||
Foreign: | ||||||||||||||||||||||||
Commercial and industrial | 19,126 | 23.1 | 20,819 | 23.7 | 1,693 | 0.6 | ||||||||||||||||||
Banks and other financial institutions | 9,087 | 11.0 | 10,475 | 11.9 | 1,388 | 0.9 | ||||||||||||||||||
Government and public institutions | 297 | 0.3 | 317 | 0.4 | 20 | 0.1 | ||||||||||||||||||
Other | 33 | 0.0 | 35 | 0.1 | 2 | 0.1 | ||||||||||||||||||
Total foreign | 28,543 | 34.4 | 31,646 | 36.1 | 3,103 | 1.7 | ||||||||||||||||||
Subtotal | 82,952 | 100.0 | % | 87,677 | 100.0 | % | 4,725 | — | ||||||||||||||||
Less: Unearned income and deferred loan fees—net | (152 | ) | (149 | ) | 3 | |||||||||||||||||||
Total loans before allowance for loan losses | ¥ | 82,800 | ¥ | 87,528 | ¥ | 4,728 | ||||||||||||||||||
(1) |
Other industries |
(2) | Certain loans of domestic and foreign were reclassified in order to conform to the current year’s presentation. |
financial institutions.
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Obligor category (1)(2) | Obligor rating (3) | Definition | ||
Normal | A | Obligors whose certainty of debt fulfillment is very high, hence their level of credit risk is very low. | ||
B | Obligors whose certainty of debt fulfillment poses no problems for the foreseeable future, and their level of credit risk is low. | |||
C | Obligors whose certainty of debt fulfillment and their level of credit risk pose no problems for the foreseeable future. | |||
D | Obligors whose current certainty of debt fulfillment poses no problems, however, their resistance to future economic environmental changes is low. | |||
Watch | E1 | Obligors that require observation going forward because of either minor concerns regarding their financial position, or their somewhat weak or unstable business conditions. | ||
E2 | Obligors that require special observation going forward because of problems with their borrowings such as reduced or suspended interest payments, problems with debt fulfillment such as failure to make principal or interest payments, or problems with their financial position as a result of their weak or unstable business conditions. | |||
Intensive control | F | Obligors that are not yet bankrupt but are in financial difficulties and are deemed likely to become bankrupt in the future because of insufficient progress in implementing their management improvement plans or other measures (including obligors that are receiving ongoing support from financial institutions). | ||
Substantially bankrupt | G | Obligors that have not yet become legally or formally bankrupt but are substantially insolvent because they are in serious financial difficulties and are deemed to be incapable of being restructured. | ||
Bankrupt | H | Obligors that have become legally or formally bankrupt. |
(1) | Special attention obligors are watch obligors with debt in troubled debt restructuring or 90 days or more delinquent debt. Loans to such obligors are considered impaired. |
(2) | We classify loans to special attention, intensive control, substantially bankrupt and bankrupt obligors as impaired loans. |
(3) | Equivalent obligor ratings are determined for the other portfolio segment. |
terms for the periods presented other than those already designated as impaired loans. See “Item 11. Quantitative and Qualitative Disclosures about Credit, Market and Other Risk—Credit Risk Management” for descriptions of our self-assessment procedures and our internal credit rating system.
2020 was ¥9 billion.
As of March 31, | Increase (decrease) | |||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||
Impaired loans | Ratio to gross total loans by industry(1) | Impaired loans | Ratio to gross total loans by industry | Impaired loans | Ratio to gross total loans by industry | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | ¥ | 379 | 4.3 | % | ¥ | 142 | 1.7 | % | ¥ | (237 | ) | (2.6 | )% | |||||||||||
Construction and real estate | 57 | 0.7 | 41 | 0.5 | (16 | ) | (0.2 | ) | ||||||||||||||||
Services | 66 | 1.4 | 58 | 1.2 | (8 | ) | (0.2 | ) | ||||||||||||||||
Wholesale and retail | 147 | 2.9 | 131 | 2.6 | (16 | ) | (0.3 | ) | ||||||||||||||||
Transportation and communications | 23 | 0.6 | 28 | 0.8 | 5 | 0.2 | ||||||||||||||||||
Banks and other financial institutions | 6 | 0.2 | 12 | 0.3 | 6 | 0.1 | ||||||||||||||||||
Other industries | 7 | 0.1 | 4 | 0.0 | (3 | ) | (0.1 | ) | ||||||||||||||||
Individuals | 105 | 1.0 | 90 | 0.9 | (15 | ) | (0.1 | ) | ||||||||||||||||
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Total domestic | 790 | 1.4 | 506 | 0.9 | (284 | ) | (0.5 | ) | ||||||||||||||||
Foreign | 191 | 0.8 | 109 | 0.4 | (82 | ) | (0.4 | ) | ||||||||||||||||
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Total impaired loans | ¥ | 981 | 1.2 | ¥ | 615 | 0.7 | ¥ | (366 | ) | (0.5 | ) | |||||||||||||
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Note:
As of March 31, | Increase (decrease) | |||||||||||||||||||||||
2019 | 2020 | |||||||||||||||||||||||
Impaired loans | Ratio to gross total loans by industry | Impaired loans | Ratio to gross total loans by industry | Impaired loans | Ratio to gross total loans by industry | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | ¥ | 109 | 1.1 | % | ¥ | 159 | 1.6 | % | ¥ | 50 | 0.5 | % | ||||||||||||
Construction and real estate | 46 | 0.5 | 55 | 0.6 | 9 | 0.1 | ||||||||||||||||||
Services | 74 | 1.5 | 81 | 1.4 | 7 | (0.1 | ) | |||||||||||||||||
Wholesale and retail | 135 | 2.6 | 148 | 2.8 | 13 | 0.2 | ||||||||||||||||||
Transportation and communications | 31 | 0.8 | 23 | 0.6 | (8 | ) | (0.2 | ) | ||||||||||||||||
Banks and other financial institutions | 10 | 0.2 | 12 | 0.3 | 2 | 0.1 | ||||||||||||||||||
Other industries | 9 | 0.1 | 19 | 0.3 | 10 | 0.2 | ||||||||||||||||||
Individuals | 81 | 0.8 | 84 | 0.9 | 3 | 0.1 | ||||||||||||||||||
Total domestic | 495 | 0.9 | 581 | 1.0 | 86 | 0.1 | ||||||||||||||||||
Foreign | 151 | 0.5 | 135 | 0.4 | (16 | ) | (0.1 | ) | ||||||||||||||||
Total impaired loans | ¥ | 646 | 0.8 | ¥ | 716 | 0.8 | ¥ | 70 | 0.0 | |||||||||||||||
losses.
Normal and watch obligors | A formula allowance is calculated separately for obligors with small balance, homogeneous loans and for each credit rating category of corporate obligors by multiplying the loan balance with the applicable |
|
Special attention obligors | The allowance for special attention obligors is generally calculated individually based on the present value of expected future cash flows discounted at the loan’s initial effective interest rate. A formula allowance for certain special attention obligors is calculated by grouping the loans to such obligors and applying the formula described above for normal and watch obligors but using the default ratio and average impairment ratio specific to this category. |
Intensive control obligors | The allowance for intensive control obligors is generally calculated individually based on the present value of expected future cash flows discounted at the loan’s initial effective interest rate, based on the loan’s observable market price, or based on the fair value of the collateral if the loan is collateral dependent. The allowance for certain intensive control obligors is calculated by grouping the loans to such obligors and multiplying the amount of loans less estimated collateral value by the default ratio and average impairment ratio specific to this category. |
Substantially bankrupt and bankrupt obligors | The allowance is calculated individually and is equal to loan balance, less estimated collateral value. |
(in billions of yen, except percentages) Allowance for loan losses on impaired loans(1) (A) Allowance for loan losses onnon-impaired loans (B) Total allowance for loan losses (C) Impaired loans requiring an allowance for loan losses (D) Impaired loans not requiring an allowance for loan losses (E) Non-impaired loans(2) (F) Gross total loans (G) Percentage of allowance for loan losses on impaired loans against the balance of impaired loans requiring an allowance (A)/(D) x100 Percentage of allowance for loan losses onnon-impaired loans against the balance ofnon-impaired loans (B)/(F) x100 Percentage of total allowance for loan losses against gross total loans20172019 and 2018:2020: As of March 31, Increase
(decrease) 2017 2018 ¥ 303 ¥ 153 ¥ (150 ) 177 157 (20 ) ¥ 480 ¥ 310 ¥ (170 ) ¥ 851 ¥ 478 ¥ (373 ) 130 137 7 81,459 83,046 1,587 ¥ 82,440 ¥ 83,661 ¥ 1,221 35.55 % 31.87 % (3.68 )% 0.22 0.19 (0.03 )
(C)/(G) x100 0.58 0.37 (0.21 ) ¥ ¥ ¥ ¥ ¥ ¥ ¥ ¥ ¥ ¥ ¥ ¥ % % %
(1) | The allowance for loan losses on impaired loans includes the allowance for groups of loans totaling |
(2) | Non-impaired loans refer to loans categorized as “normal obligors” and “watch obligors (excluding special attention obligors)” under our internal rating system. |
Fiscal years ended March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Allowance for loan losses at beginning of fiscal year | ¥ | 451 | ¥ | 480 | ¥ | 29 | ||||||
Provision (credit) for loan losses | 38 | (126 | ) | (164 | ) | |||||||
Charge-offs: | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | (2 | ) | (9 | ) | (7 | ) | ||||||
Construction and real estate | (1 | ) | — | 1 | ||||||||
Services | (3 | ) | (5 | ) | (2 | ) | ||||||
Wholesale and retail | (6 | ) | (13 | ) | (7 | ) | ||||||
Transportation and communications | (1 | ) | (1 | ) | — | |||||||
Individuals | (7 | ) | (5 | ) | 2 | |||||||
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Total domestic charge-offs | (20 | ) | (33 | ) | (13 | ) | ||||||
Foreign | (11 | ) | (23 | ) | (12 | ) | ||||||
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Total charge-offs | (31 | ) | (56 | ) | (25 | ) | ||||||
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Recoveries: | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | 1 | 1 | — | |||||||||
Construction and real estate | 2 | 1 | (1 | ) | ||||||||
Services | 1 | 2 | 1 | |||||||||
Wholesale and retail | 5 | 1 | (4 | ) | ||||||||
Transportation and communications | 4 | — | (4 | ) | ||||||||
Banks and other financial institutions | — | 1 | 1 | |||||||||
Individuals | 3 | 2 | (1 | ) | ||||||||
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Total domestic recoveries | 16 | 8 | (8 | ) | ||||||||
Foreign | 10 | 7 | (3 | ) | ||||||||
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Total recoveries | 26 | 15 | (11 | ) | ||||||||
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Net charge-offs | (5 | ) | (41 | ) | (36 | ) | ||||||
Others(1) | (4 | ) | (3 | ) | 1 | |||||||
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Balance at end of fiscal year | ¥ | 480 | ¥ | 310 | ¥ | (170 | ) | |||||
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2020:
Fiscal years ended March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Allowance for loan losses at beginning of fiscal year | ¥ | 310 | ¥ | 307 | ¥ | (3 | ) | |||||
Provision (credit) for loan losses | 32 | 156 | 124 | |||||||||
Charge-offs: | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | (4 | ) | (6 | ) | (2 | ) | ||||||
Construction and real estate | (1 | ) | (1 | ) | — | |||||||
Services | (2 | ) | (2 | ) | — | |||||||
Wholesale and retail | (10 | ) | (16 | ) | (6 | ) | ||||||
Transportation and communications | — | (1 | ) | (1 | ) | |||||||
Other industries | (2 | ) | — | 2 | ||||||||
Individuals | (5 | ) | (5 | ) | — | |||||||
Total domestic charge-offs | (24 | ) | (31 | ) | (7 | ) | ||||||
Foreign | (24 | ) | (13 | ) | 11 | |||||||
Total charge-offs | (48 | ) | (44 | ) | 4 | |||||||
Recoveries: | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | 1 | 1 | — | |||||||||
Construction and real estate | 1 | 20 | 19 | |||||||||
Services | 1 | 1 | — | |||||||||
Wholesale and retail | 3 | 4 | 1 | |||||||||
Individuals | 1 | 1 | — | |||||||||
Total domestic recoveries | 7 | 27 | 20 | |||||||||
Foreign | 7 | 1 | (6 | ) | ||||||||
Total recoveries | 14 | 28 | 14 | |||||||||
Net charge-offs | (34 | ) | (16 | ) | 18 | |||||||
Others (1) | (1 | ) | (6 | ) | (5 | ) | ||||||
Balance at end of fiscal year | ¥ | 307 | ¥ | 441 | ¥ | 134 | ||||||
(1) | “Others” includes primarily foreign exchange translation. |
We recorded a credit
deterioration of credit status of certain domestic borrowers.
As of March 31, | Increase (decrease) | |||||||||||||||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||||||||||||||
Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||
Debt securities | ¥ | 16,684 | ¥ | 16,756 | ¥ | 72 | ¥ | 19,587 | ¥ | 19,633 | ¥ | 46 | ¥ | 2,903 | ¥ | 2,877 | ¥ | (26 | ) | |||||||||||||||||
Japanese government bonds | 10,257 | 10,263 | 6 | 13,334 | 13,332 | (2 | ) | 3,077 | 3,069 | (8 | ) | |||||||||||||||||||||||||
Other than Japanese government bonds | 6,427 | 6,493 | 66 | 6,253 | 6,301 | 48 | (174 | ) | (192 | ) | (18 | ) | ||||||||||||||||||||||||
Equity securities (marketable) | 1,530 | 3,801 | 2,271 | 1,595 | 4,033 | 2,438 | 65 | 232 | 167 | |||||||||||||||||||||||||||
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Total | ¥ | 18,214 | ¥ | 20,557 | ¥ | 2,343 | ¥ | 21,182 | ¥ | 23,666 | ¥ | 2,484 | ¥ | 2,968 | ¥ | 3,109 | ¥ | 141 | ||||||||||||||||||
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Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | ¥ | 3,060 | ¥ | 3,097 | ¥ | 37 | ¥ | 1,960 | ¥ | 1,984 | ¥ | 24 | ¥ | (1,100 | ) | ¥ | (1,113 | ) | ¥ | (13 | ) | |||||||||||||||
Agency mortgage-backed securities | 757 | 750 | (7 | ) | 558 | 538 | (20 | ) | (199 | ) | (212 | ) | (13 | ) | ||||||||||||||||||||||
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Total | ¥ | 3,817 | ¥ | 3,847 | ¥ | 30 | ¥ | 2,518 | ¥ | 2,522 | ¥ | 4 | ¥ | (1,299 | ) | ¥ | (1,325 | ) | ¥ | (26 | ) | |||||||||||||||
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As of March 31, | Increase (decrease) | |||||||||||||||||||||||||||||||||||
2019 | 2020 | |||||||||||||||||||||||||||||||||||
Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | ¥ | 11,889 | ¥ | 11,897 | ¥ | 8 | ¥ | 12,652 | ¥ | 12,603 | ¥ | (49 | ) | ¥ | 763 | ¥ | 706 | ¥ | (57 | ) | ||||||||||||||||
Other than Japanese government bonds | 6,205 | 6,236 | 31 | 6,481 | 6,510 | 29 | 276 | 274 | (2 | ) | ||||||||||||||||||||||||||
Total | ¥ | 18,094 | ¥ | 18,133 | ¥ | 39 | ¥ | 19,133 | ¥ | 19,113 | ¥ | (20 | ) | ¥ | 1,039 | ¥ | 980 | ¥ | (59 | ) | ||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | ¥ | 1,120 | ¥ | 1,140 | ¥ | 20 | ¥ | 480 | ¥ | 493 | ¥ | 13 | ¥ | (640 | ) | ¥ | (647 | ) | ¥ | (7 | ) | |||||||||||||||
Agency mortgage-backed securities | 484 | 470 | (14 | ) | 382 | 382 | — | (102 | ) | (88 | ) | 14 | ||||||||||||||||||||||||
Total | ¥ | 1,604 | ¥ | 1,610 | ¥ | 6 | ¥ | 862 | ¥ | 875 | ¥ | 13 | ¥ | (742 | ) | ¥ | (735 | ) | ¥ | 7 | ||||||||||||||||
2.4 years compared to 2.1 years as of March 31, 2019.
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Deposits | ¥ | 131,185 | ¥ | 136,884 | ¥ | 5,699 | ||||||
Due to trust accounts | 4,123 | 3,993 | (130 | ) | ||||||||
Call money and funds purchased | 1,255 | 2,105 | 850 | |||||||||
Payables under repurchase agreements | 17,970 | 16,657 | (1,313 | ) | ||||||||
Payables under securities lending transactions | 1,919 | 1,833 | (86 | ) | ||||||||
Other short-term borrowings | 1,477 | 1,688 | 211 | |||||||||
Trading account liabilities | 13,592 | 13,115 | (477 | ) | ||||||||
Bank acceptances outstanding | 184 | 213 | 29 | |||||||||
Income taxes payable | 74 | 65 | (9 | ) | ||||||||
Deferred tax liabilities | 140 | 306 | 166 | |||||||||
Accrued expenses | 209 | 233 | 24 | |||||||||
Long-term debt | 14,529 | 12,955 | (1,574 | ) | ||||||||
Other liabilities | 5,027 | 4,705 | (322 | ) | ||||||||
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Total liabilities | ¥ | 191,684 | ¥ | 194,752 | ¥ | 3,068 | ||||||
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2020:
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Deposits | ¥ | 138,297 | ¥ | 144,948 | ¥ | 6,651 | ||||||
Due to trust accounts | 312 | 250 | (62 | ) | ||||||||
Call money and funds purchased | 2,842 | 2,263 | (579 | ) | ||||||||
Payables under repurchase agreements | 14,640 | 17,971 | 3,331 | |||||||||
Payables under securities lending transactions | 1,798 | 1,424 | (374 | ) | ||||||||
Other short-term borrowings | 1,995 | 4,914 | 2,919 | |||||||||
Trading account liabilities | 10,121 | 12,417 | 2,296 | |||||||||
Bank acceptances outstanding | 187 | 168 | (19 | ) | ||||||||
Income taxes payable | 59 | 69 | 10 | |||||||||
Deferred tax liabilities | 108 | 26 | (82 | ) | ||||||||
Accrued expenses | 289 | 249 | (40 | ) | ||||||||
Long-term debt | 11,529 | 10,346 | (1,183 | ) | ||||||||
Other liabilities | 5,933 | 6,998 | 1,065 | |||||||||
Total liabilities | ¥ | 188,110 | ¥ | 202,043 | ¥ | 13,933 | ||||||
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Domestic: | ||||||||||||
Noninterest-bearing deposits | ¥ | 19,064 | ¥ | 21,069 | ¥ | 2,005 | ||||||
Interest-bearing deposits | 87,359 | 91,207 | 3,848 | |||||||||
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Total domestic deposits | 106,423 | 112,276 | 5,853 | |||||||||
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Foreign: | ||||||||||||
Noninterest-bearing deposits | 1,996 | 2,257 | 261 | |||||||||
Interest-bearing deposits | 22,766 | 22,351 | (415 | ) | ||||||||
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Total foreign deposits | 24,762 | 24,608 | (154 | ) | ||||||||
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Total deposits | ¥ | 131,185 | ¥ | 136,884 | ¥ | 5,699 | ||||||
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2020:
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Domestic: | ||||||||||||
Noninterest-bearing deposits | ¥ | 23,845 | 28,110 | ¥ | 4,265 | |||||||
Interest-bearing deposits | 84,019 | 86,651 | 2,632 | |||||||||
Total domestic deposits | 107,864 | 114,761 | 6,897 | |||||||||
Foreign: | ||||||||||||
Noninterest-bearing deposits | 1,794 | 2,186 | 392 | |||||||||
Interest-bearing deposits | 28,639 | 28,001 | (638 | ) | ||||||||
Total foreign deposits | 30,433 | 30,187 | (246 | ) | ||||||||
Total deposits | ¥ | 138,297 | ¥ | 144,948 | ¥ | 6,651 | ||||||
increases in ordinary deposits and current accounts. Foreign deposits decreased by ¥154¥246 billion from March 31, 20172019 to ¥24,608¥30,187 billion at March 31, 2018 due mainly to a decrease in time deposits, offset in part by an increase in certificates of deposit.
2020.
As of March 31, | Increase (decrease) | |||||||||||||||||||||||||||||||||||
2017 | 2018 | |||||||||||||||||||||||||||||||||||
Domestic | Foreign | Total | Domestic | Foreign | Total | Domestic | Foreign | Total | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Due to trust accounts | ¥ | 4,123 | ¥ | — | ¥ | 4,123 | ¥ | 3,993 | ¥ | — | ¥ | 3,993 | ¥ | (130 | ) | ¥ | — | ¥ | (130 | ) | ||||||||||||||||
Call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 5,727 | 15,417 | 21,144 | 6,724 | 13,871 | 20,595 | 997 | (1,546 | ) | (549 | ) | |||||||||||||||||||||||||
Other short-term borrowings | 587 | 890 | 1,477 | 827 | 861 | 1,688 | 240 | (29 | ) | 211 | ||||||||||||||||||||||||||
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Total short-term borrowings | ¥ | 10,437 | ¥ | 16,307 | ¥ | 26,744 | ¥ | 11,544 | ¥ | 14,732 | ¥ | 26,276 | ¥ | 1,107 | ¥ | (1,575 | ) | ¥ | (468 | ) | ||||||||||||||||
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2020:
As of March 31, | Increase (decrease) | |||||||||||||||||||||||||||||||||||
2019 | 2020 | |||||||||||||||||||||||||||||||||||
Domestic | Foreign | Total | Domestic | Foreign | Total | Domestic | Foreign | Total | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Due to trust accounts | ¥ | 312 | ¥ | — | ¥ | 312 | ¥ | 250 | ¥ | — | ¥ | 250 | ¥ | (62 | ) | ¥ | — | ¥ | (62 | ) | ||||||||||||||||
Call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 7,294 | 11,986 | 19,280 | 6,616 | 15,042 | 21,658 | (678 | ) | 3,056 | 2,378 | ||||||||||||||||||||||||||
Other short-term borrowings | 926 | 1,069 | 1,995 | 4,442 | 472 | 4,914 | 3,516 | (597 | ) | 2,919 | ||||||||||||||||||||||||||
Total short-term borrowings | ¥ | 8,532 | ¥ | 13,055 | ¥ | 21,587 | ¥ | 11,308 | ¥ | 15,514 | ¥ | 26,822 | ¥ | 2,776 | ¥ | 2,459 | ¥ | 5,235 | ||||||||||||||||||
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
MHFG shareholders’ equity: | ||||||||||||
Common stock | ¥ | 5,826 | ¥ | 5,826 | ¥ | — | ||||||
Retained earnings | 919 | 1,306 | 387 | |||||||||
Accumulated other comprehensive income, net of tax | 1,521 | 1,742 | 221 | |||||||||
Treasury stock, at cost | (5 | ) | (6 | ) | (1 | ) | ||||||
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Total MHFG shareholders’ equity | 8,261 | 8,868 | 607 | |||||||||
Noncontrolling interests | 511 | 636 | 125 | |||||||||
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Total equity | ¥ | 8,772 | ¥ | 9,504 | ¥ | 732 | ||||||
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2020:
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
MHFG shareholders’ equity: | ||||||||||||
Common stock | ¥ | 5,830 | ¥ | 5,827 | ¥ | (3 | ) | |||||
Retained earnings | 2,741 | 2,700 | (41 | ) | ||||||||
Accumulated other comprehensive income (loss), net of tax | 164 | (9 | ) | (173 | ) | |||||||
Treasury stock, at cost | (8 | ) | (6 | ) | 2 | |||||||
Total MHFG shareholders’ equity | 8,727 | 8,512 | (215 | ) | ||||||||
Noncontrolling interests | 774 | 664 | (110 | ) | ||||||||
Total equity | ¥ | 9,501 | ¥ | 9,176 | ¥ | (325 | ) | |||||
tax to accumulated other comprehensive loss, net of tax and a decrease in noncontrolling interests.
AccumulatedMarch 31, 2020 compared to accumulated other comprehensive income, net of tax increased by ¥221of ¥164 billion fromas of March 31, 20172019. The change was due primarily to ¥1,742 billion at March 31, 2018 due to an increase in pension liability adjustments of ¥155¥127 billion an increase in net unrealized gains onavailable-for-sale securities of ¥95 billion and a decrease in foreign currency translation adjustments of ¥30¥50 billion.
As of May 31, | ||||||||||||||||||||||||
S&P | Moody’s | |||||||||||||||||||||||
Long-term | ||||||||||||||||||||||||
Short-term | ||||||||||||||||||||||||
| | Stand-alone credit profile | Long-term | Short-term | Baseline credit assessment | |||||||||||||||||||
Mizuho | A- | — | — | A1 | P-1 | — | ||||||||||||||||||
Mizuho Bank | A | A-1 | a | A1 | P-1 | baa1 | ||||||||||||||||||
Mizuho Trust & Banking | A | A-1 | a | A1 | P-1 | baa1 |
actions based on such conditions. As of March 31, 2018,2020, the balance of Japanese government bonds included within our investments and measured at fair value was ¥13.3¥12.6 trillion (excluding
Related to regulatory liquidity requirements, the liquidity coverage ratio (“LCR”) standard has been introduced in Japan. The minimum LCR under the LCR guidelines is 100% on both a consolidated andnon-consolidated basis for banks with international operations or on a consolidated basis for bank holding companies with international operations, while it is subject tophase-in arrangements pursuant to which the LCR rises in equal annual steps of 10 percentage points to reach 100% on January 1, 2019, with a minimum requirement of 90% applicable for the period between January 1 and December 31, 2018. The LCR disclosure guidelines of the Financial Service Agency require banks and bank holding companies with international operations to disclose the three-month averages of daily LCR.
Fourth quarter of fiscal year ended March 31, 2020 | ||||
(in billions of yen, except percentages) | ||||
Mizuho Financial Group (Consolidated) | ||||
Total high-quality liquid assets (“HQLA”) allowed to be included in the calculation (weighted) | ¥ | 60,112 | ||
Net cash outflows (weighted) | 43,816 | |||
LCR | 137.3 | % | ||
Mizuho Bank (Consolidated) | ||||
Total HQLA allowed to be included in the calculation (weighted) | ¥ | 56,118 | ||
Net cash outflows (weighted) | 41,302 | |||
LCR | 136.0 | % | ||
| ||||
Total HQLA allowed to be included in the calculation (weighted) | ¥ | 55,298 | ||
Net cash outflows (weighted) | 40,214 | |||
LCR | 137.7 | % | ||
Mizuho Trust and Banking (Consolidated) | ||||
Total HQLA allowed to be included in the calculation (weighted) | ¥ | 2,546 | ||
Net cash outflows (weighted) | 1,691 | |||
LCR | 151.2 | % | ||
| ||||
Total HQLA allowed to be included in the calculation (weighted) | ¥ | 2,489 | ||
Net cash outflows (weighted) | 1,599 | |||
LCR | 156.2 | % |
regulations. Failure to meet minimum capital requirements may initiate certain mandatory actions by regulators that, if undertaken, could have a direct material effect on our financial condition and results of operations.
Regulatory adjustments such as goodwill and other intangibles, and defined benefit pension fund assets and liabilities, are to be applied mainly to the calculation of Common Equity Tier 1 capital in the form of deductions.
requirements for7.0%minimum Common Equity Tier 1 capital requirement (includingratio of 4.5%, the capital conservation buffer). The requirements began phasing in from January 2016buffer of 2.5% and will be fully implemented by January 2019.the countercyclical capital buffer. We were included in the list of20172019 and were allocated to the category that would require 1.0% of additional loss absorbency.
Regulatory adjustments
Theon the global banking system, it endorsed a set of measures, including the deferral of the implementation date of the finalized Basel III reforms by one year to January 1, 2023, and the extension of the accompanying transitional arrangements for the output floor by one year to January 1, 2028, as well as the implementation date of the finalized market risk capital requirements and regulatory adjustments are beingframework by one year to January 1, 2023. As a result, under the finalized Basel III reforms, the revisions to the capital floor will be phased in over a transitional period as follows (italicized percentages indicate those stillfrom January 1, 2023, with the initial capital floor of 50%, and will be fully implemented at 72.5% from January 1, 2028, and the leverage ratio requirements under the finalized definition of the leverage ratio exposure measure and the leverage ratio buffer requirement for
March 2017 | March 2018 | March 2019 | March 2020 | March 2021 | March 2022 | |||||||||||||||||||
Minimum Common Equity Tier 1 capital | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | ||||||||||||
Minimum Tier 1 capital | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | ||||||||||||
Minimum total capital | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | ||||||||||||
Phase-in of deductions from capital | 80.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||
Phase out of recognition of capital instruments that no longer qualify as capital | 50.0 | % | 40.0 | % | 30.0 | % | 20.0 | % | 10.0 | % | 0.0 | % | ||||||||||||
Capital conservation buffer | 1.25 | % | 1.875 | % | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | ||||||||||||
Countercyclical capital buffer(1) | 0.00 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | ||||||||||||
Additional loss absorbency requirements forG-SIBs andD-SIBs(2) | 0.50 | % | 0.75 | % | 1.0 | % | 1.0 | % | 1.0 | % | 1.0 | % |
Notes:
Japan from March 2023. In June 2020, in coordination with the monetary policy of the Bank of Japan in response to the impact of the
If the capital conservation buffer, the countercyclical capital buffer and the additional loss absorption capacity requirement for
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen, except percentages) | ||||||||||||
Common Equity Tier 1 capital | ¥ | 7,001.6 | ¥ | 7,437.0 | ¥ | 435.3 | ||||||
Additional Tier 1 capital | 1,209.8 | 1,755.1 | 545.3 | |||||||||
|
|
|
|
|
| |||||||
Tier 1 capital | 8,211.5 | 9,192.2 | 980.7 | |||||||||
Tier 2 capital | 1,839.4 | 1,668.1 | (171.2 | ) | ||||||||
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| |||||||
Total capital | ¥ | 10,050.9 | ¥ | 10,860.4 | ¥ | 809.4 | ||||||
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| |||||||
Risk-weighted assets | ¥ | 61,717.1 | ¥ | 59,528.9 | ¥ | (2,188.1 | ) | |||||
Common Equity Tier 1 capital ratio | 11.34 | % | 12.49 | % | 1.15 | % | ||||||
Required Common Equity Tier 1 capital ratio(1) | 6.25 | 7.135 | 0.885 | |||||||||
Tier 1 capital ratio | 13.30 | 15.44 | 2.14 | |||||||||
Required Tier 1 capital ratio(1) | 7.75 | 8.635 | 0.885 | |||||||||
Total capital ratio | 16.28 | 18.24 | 1.96 | |||||||||
Required total capital ratio(1) | 9.75 | 10.635 | 0.885 | |||||||||
CET1 available after meeting the bank’s minimum capital requirements | 6.84 | 7.99 | 1.15 | |||||||||
Leverage ratio | 3.95 | 4.28 | 0.33 |
As of | ||||||||||||
March 31, 2019 | March 31, 2020 | Increase (decrease) | ||||||||||
(in billions of yen, except percentages) | ||||||||||||
Common Equity Tier 1 capital | ¥ | 7,390.0 | ¥ | 7,244.7 | ¥ | (145.2 | ) | |||||
Additional Tier 1 capital | 1,842.1 | 1,779.6 | (62.4 | ) | ||||||||
Tier 1 capital | 9,232.1 | 9,024.4 | (207.7 | ) | ||||||||
Tier 2 capital | 1,685.3 | 1,697.8 | 12.5 | |||||||||
Total capital | ¥ | 10,917.5 | ¥ | 10,722.2 | ¥ | (195.2 | ) | |||||
Risk-weighted assets | ¥ | 57,899.5 | ¥ | 62,141.2 | ¥ | 4,241.6 | ||||||
Common Equity Tier 1 capital ratio | 12.76 | % | 11.65 | % | (1.11 | )% | ||||||
Required Common Equity Tier 1 capital ratio (1) | 8.05 | % | 8.01 | % | — | |||||||
Tier 1 capital ratio | 15.94 | % | 14.52 | % | (1.42 | )% | ||||||
Required Tier 1 capital ratio (1) | 9.55 | % | 9.51 | % | — | |||||||
Total capital ratio | 18.85 | % | 17.25 | % | (1.60 | )% | ||||||
Required total capital ratio (1) | 11.55 | % | 11.51 | % | — | |||||||
CET1 available after meeting the bank’s minimum capital requirements | 8.26 | % | 7.15 | % | (1.11 | )% | ||||||
Leverage ratio | 4.42 | % | 4.08 | % | (0.34 | )% |
(1) | The required ratios |
loss absorbency requirements for G-SIBs andD-SIBs of |
2020.
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
Mizuho Bank | ||||||||||||
Common Equity Tier 1 capital ratio | 11.16 | % | 12.34 | % | 1.18 | % | ||||||
Tier 1 capital ratio | 13.34 | 15.61 | 2.27 | |||||||||
Total capital ratio | 16.20 | 18.52 | 2.32 | |||||||||
Leverage ratio | 4.16 | 4.53 | 0.37 | |||||||||
Mizuho Trust & Banking | ||||||||||||
Common Equity Tier 1 capital ratio | 18.73 | 19.99 | 1.26 | |||||||||
Tier 1 capital ratio | 18.73 | 20.05 | 1.32 | |||||||||
Total capital ratio | 19.47 | 20.28 | 0.81 | |||||||||
Leverage ratio | 6.74 | 7.03 | 0.29 |
As of | Increase (decrease) | |||||||||||
March 31, 2019 | March 31, 2020 | |||||||||||
Mizuho Bank | ||||||||||||
Common Equity Tier 1 capital ratio | 12.60 | % | 11.39 | % | (1.21 | )% | ||||||
Tier 1 capital ratio | 16.06 | % | 14.50 | % | (1.56 | )% | ||||||
Total capital ratio | 19.02 | % | 17.29 | % | (1.73 | )% | ||||||
Leverage ratio | 4.44 | % | 4.02 | % | (0.42 | )% | ||||||
Mizuho Trust & Banking | ||||||||||||
Common Equity Tier 1 capital ratio | 23.67 | % | 23.64 | % | (0.03 | )% | ||||||
Tier 1 capital ratio | 23.70 | % | 23.66 | % | (0.04 | )% | ||||||
Total capital ratio | 23.87 | % | 23.74 | % | (0.13 | )% | ||||||
Leverage ratio | 6.55 | % | 6.79 | % | 0.24 | % |
2020.
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Guarantees: | ||||||||||||
Performance guarantees | ¥ | 2,243 | ¥ | 2,165 | ¥ | (78 | ) | |||||
Guarantees on loans | 278 | 241 | (37 | ) | ||||||||
Guarantees on securities | 175 | 164 | (11 | ) | ||||||||
Other guarantees | 1,823 | 2,210 | 387 | |||||||||
Guarantees for the repayment of trust principal | 730 | 709 | (21 | ) | ||||||||
Liabilities of trust accounts | 15,177 | 13,861 | (1,316 | ) | ||||||||
Derivative financial instruments | 14,415 | 11,654 | (2,761 | ) |
As of March 31, | Increase (decrease) | |||||||||||
2017 | 2018 | |||||||||||
(in billions of yen) | ||||||||||||
Commitments: | ||||||||||||
Commitments to extend credit | ¥ | 76,678 | ¥ | 78,448 | ¥ | 1,770 | ||||||
Commercial letters of credit | 522 | 690 | 168 | |||||||||
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| |||||||
Total commitments | ¥ | 77,200 | ¥ | 79,138 | ¥ | 1,938 | ||||||
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|
|
|
2020:
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Guarantees: | ||||||||||||
Performance guarantees | ¥ | 2,307 | ¥ | 2,456 | ¥ | 149 | ||||||
Guarantees on loans | 289 | 301 | 12 | |||||||||
Guarantees on securities | 145 | 110 | (35 | ) | ||||||||
Other guarantees | 2,324 | 2,314 | (10 | ) | ||||||||
Guarantees for the repayment of trust principal | 65 | 59 | (6 | ) | ||||||||
Liabilities of trust accounts | 362 | 446 | 84 | |||||||||
Derivative financial instruments | 14,170 | 21,756 | 7,586 |
As of March 31, | Increase (decrease) | |||||||||||
2019 | 2020 | |||||||||||
(in billions of yen) | ||||||||||||
Commitments: | ||||||||||||
Commitments to extend credit | ¥ | 76,857 | ¥ | 76,633 | (224 | ¥) | ||||||
Commercial letters of credit | 778 | 690 | (88 | ) | ||||||||
Total commitments | ¥ | 77,635 | ¥ | 77,323 | (312 | ¥) | ||||||
Due in one year or less | Due from one year to two years | Due from two years to three years | Due from three years to four years | Due from four years to five years | Due after five years | Total | ||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Time deposits | ¥ | 35,724 | ¥ | 1,689 | ¥ | 1,285 | ¥ | 329 | ¥ | 362 | ¥ | 137 | ¥ | 39,526 | ||||||||||||||
Certificates of deposit | 11,021 | 297 | 61 | 4 | — | — | 11,383 | |||||||||||||||||||||
Long-term debt | 2,492 | 1,607 | 1,314 | 1,205 | 1,068 | 5,269 | 12,955 | |||||||||||||||||||||
Capitalized leases | 12 | 10 | 7 | 4 | 2 | 1 | 36 | |||||||||||||||||||||
Operating leases | 52 | 44 | 38 | 32 | 23 | 57 | 246 | |||||||||||||||||||||
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| |||||||||||||||
Total(1)(2) | ¥ | 49,289 | ¥ | 3,637 | ¥ | 2,698 | ¥ | 1,570 | ¥ | 1,453 | ¥ | 5,463 | ¥ | 64,110 | ||||||||||||||
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|
2020:
Due in one year or less | Due from one year to two years | Due from two years to three years | Due from three years to four years | Due from four years to five years | Due after five years | Total | ||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Time deposits | ¥ | 37,596 | ¥ | 1,736 | ¥ | 1,169 | ¥ | 342 | ¥ | 400 | ¥ | 216 | ¥ | 41,459 | ||||||||||||||
Certificates of deposit | 12,984 | 221 | 11 | — | 67 | — | 13,283 | |||||||||||||||||||||
Long-term debt | 560 | 1,430 | 1,235 | 697 | 1,023 | 5,401 | 10,346 | |||||||||||||||||||||
Capitalized leases | 7 | 5 | 3 | 1 | — | — | 16 | |||||||||||||||||||||
Operating leases | 94 | 68 | 54 | 48 | 42 | 347 | 653 | |||||||||||||||||||||
Total (1)(2) | ¥ | 51,234 | ¥ | 3,455 | ¥ | 2,469 | ¥ | 1,087 | ¥ | 1,532 | ¥ | 5,964 | ¥ | 65,741 | ||||||||||||||
(1) | A contribution paid to our pension plans, which is not included in the above table, is expected to be approximately |
(2) | The amount of unrecognized tax benefits, which is not included in the above table, was |
As of and for the fiscal year ended March 31, 2018 | ||||||||
Total MHFG shareholders’ equity | Net income attributable to MHFG shareholders | |||||||
(in billions of yen) | ||||||||
U.S. GAAP | ¥ | 8,868.4 | ¥ | 577.6 | ||||
Differences arising from different accounting for: | ||||||||
1. Derivative financial instruments and hedging activities | 64.0 | 107.8 | ||||||
2. Investments | (97.7 | ) | (101.7 | ) | ||||
3. Loans | 158.2 | 2.4 | ||||||
4. Allowances for loan losses andoff-balance-sheet instruments | 79.6 | (6.8 | ) | |||||
5. Premises and equipment | (119.6 | ) | (35.4 | ) | ||||
6. Land revaluation | 178.4 | (2.9 | ) | |||||
7. Business combinations | (86.9 | ) | (15.4 | ) | ||||
8. Pension liabilities | 117.1 | 4.4 | ||||||
9. Consolidation of variable interest entities | 54.9 | 13.2 | ||||||
10. Deferred taxes | (160.3 | ) | 47.2 | |||||
11. Foreign currency translation | — | (10.8 | ) | |||||
12. Other | 10.9 | (3.1 | ) | |||||
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| |||||
Japanese GAAP | ¥ | 9,067.0 | (1) | ¥ | 576.5 | |||
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|
As of and for the fiscal year ended March 31, 2020 | ||||||||
Total MHFG shareholders’ equity | Net income attributable to MHFG shareholders | |||||||
(in billions of yen) | ||||||||
U.S. GAAP | ¥ | 8,512.4 | ¥ | 150.2 | ||||
Differences arising from different accounting for: | ||||||||
1. Derivative financial instruments and hedging activities | 74.7 | (113.1 | ) | |||||
2. Investments | (134.4 | ) | 484.4 | |||||
3. Loans | 173.7 | 3.0 | ||||||
4. Allowances for loan losses and off-balance-sheet instruments | 84.7 | (0.7 | ) | |||||
5. Premises and equipment | (327.0 | ) | 96.7 | |||||
6. Land revaluation | 169.5 | (1.5 | ) | |||||
7. Business combinations | (79.0 | ) | (6.0 | ) | ||||
8. Pension liabilities | 136.0 | 57.0 | ||||||
9. Consolidation of variable interest entities | 66.4 | (89.2 | ) | |||||
10. Deferred taxes | (138.1 | ) | (115.3 | ) | ||||
11. Foreign currency translation | — | (16.4 | ) | |||||
12. Other | 15.3 | (0.5 | ) | |||||
Japanese GAAP | ¥ | 8,554.2 | (1) | ¥ | 448.6 | |||
(1) | Includes total accumulated other comprehensive income and stock acquisition rights |
Certain sales and subsequent repurchases
in earnings.
Under U.S. GAAP, the election of the fair value option for financial assets and liabilities is permitted according to ASC 825, while it is not permitted under Japanese GAAP. As we elected the fair value option for foreign currency denominatedavailable-for-sale securities under U.S. GAAP, these securities were reclassified as trading securities, and the entire amount of changes in their fair values are recognized in earnings, while under Japanese GAAP, only the changes attributable to movements in foreign currency exchange rates are recognized in earnings.
effective interest rate or, as a practical expedient, the loan’s observable market price or the fair value of the collateral if the loan is collateral dependent. For certain impaired loans that are aggregated for the purpose of
ITEM 6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
areis information regarding the directors of Mizuho Financial Group as of June 30, 2018:2020:NameAgeDirector TypeChair /Deputy Chairof the BoardCommittee Membership NominatingCompensationAuditRisk(4)Tatsufumi Sakai 58 Executive(1)— — — — — Takanori Nishiyama 56 Executive(1)— — — — — Makoto Umemiya 53 Executive(1)— — — — — Yasuyuki Shibata 55 Executive(1) — — — — — Hisashi Kikuchi 52 Executive(1)— — — — — Yasuhiro Sato 66 Non-executive(2)— — — — — Ryusuke Aya 58 Non-executive(2) Deputy Chair— — MemberChairNobukatsu Funaki 59 Non-executive(2)— — — Member— Tetsuo Seki 79 Independent(3)MemberMemberChair— Takashi Kawamura 78 Independent(3)ChairMember— — Tatsuo Kainaka 78 Independent(3)— MemberChairMember— Hirotake Abe 73 Independent(3)— MemberMember— Hiroko Ota 64 Independent(3)ChairMember— — Izumi Kobayashi 59 Independent(3) — Member — —
(1) | Directors concurrently serving as executive officers. |
(2) | Directors not concurrently serving as executive |
(3) | Directors satisfying the requirements for outside directors, as defined in the Companies Act of Japan, and those for independent directors, as defined both by the Tokyo Stock Exchange and by Mizuho Financial Group. |
(4) | Risk Committee consists of the two directors and |
Yasuyuki Shibata Hiroaki EharaRisk ManagementHuman Resources Group (Group CRO)CHRO) since June 2017.2019. Previously, he had been Executive Managing Director / Head of Human Resources Group and Head of Internal Audit Group of Mizuho Trust & Banking from April 2016 to April 2019; and Executive Officer, General Manager of Risk ManagementTrust Business Department from July 2016 to June 2017; and General ManagerVI of Americas Treasury DivisionMizuho Trust & Banking from April 20142015 to JulyApril 2016. He concurrently serves as Executive Managing Director of Mizuho Bank.
Mr. Hisashi Kikuchi has been Member of the Board of Directors and Managing Executive Officer / Head of Strategic Planning Group (Group CSO) since June 2018. Previously, he had been General Manager of Corporate Secretariat from April 2015 to June 2018; and General Manager of Tokyo Corporate Banking Division from July 2013 to April 2015. He concurrently serves as Executive Managing Director of Mizuho Bank.
Bank and Mizuho Trust & Banking.
Izumi Kobayashi.
Mr. Nobukatsu Funaki has been Member of the Board of Directors since June 2014. Previously, he had been Audit & Supervisory Board Member at eachNagoya Corporate Branch of Mizuho Financial Group (from June 2013Bank from April 2015 to June 2014),April 2017; and Executive Officer, General Manager of Marunouchi-Chuo Branch Division No.1 of Mizuho Securities (April 2013Bank from April 2014 to June 2014) and the former Mizuho Corporate Bank (from March 2010 to June 2013)
April 2015.
Mr. Tatsuo Kainaka
Ms. Hiroko OtaMember of the Board, Chairperson of Mitsubishi Chemical Holdings Corporation; Outside Director of Toshiba Corporation; and Member of the Board, Chairman of The KAITEKI Institute, Inc.
JFE Holdings, Inc.
President of the Multilateral Investment Guarantee Agency of the World Bank Group. She concurrently serves as Outside Director of ANA HOLDINGS INC.; Outside Director of MitsuiMITSUI & Co.CO., Ltd.LTD.; and MemberOutside Director of the BoardOMRON Corporation.
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Name | Age | Title | Area of Oversight | |||||
Tatsufumi Sakai (1) | 60 | President & (2) | Chief Executive Officer of (Group CEO) | |||||
Seiji Imai | 58 | Senior Managing Executive Officer (2) | Head of Corporate & Institutional Company / Head of Global Products Unit | |||||
Satoshi Ishii (1) | 56 | Senior Managing Executive Officer (2) | Chief Digital Innovation Officer (CDIO), Head of IT & Systems Group (Group CIO) and Head of Operations Group (Group COO) | |||||
Masahiro Otsuka | 58 | Senior Managing Executive Officer | Head of | |||||
Naofumi Fuke | 62 | Senior Managing Executive Officer | Co-Head of | |||||
Hiroshi Nagamine | 56 | Senior Managing Executive Officer | ||||||
| Head of Global Corporate Company | |||||||
| ||||||||
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| ||||||||
| / Deputy Head of Global Products Unit | |||||||
Motonori Wakabayashi (1) | 55 | Senior Managing Executive Officer | Head of | |||||
Makoto Umemiya (1) | 55 | Senior Managing Executive Officer | Head of Financial Control & Accounting Group (Group CFO) | |||||
Hisashi Kikuchi | 54 | Managing Executive Officer | Head of | |||||
| 55 | Managing Executive Officer | Head of Human Resources Group (Group CHRO) | |||||
Masatoshi Yoshihara | 57 | Managing Executive Officer | Co-Head of Global Markets Company | |||||
Yasuhiro Shibata | 56 | Managing Executive Officer | Co-Head of Global Markets Company | |||||
Masamichi Ishikawa | 56 | Managing Executive Officer | Head of Asset Management Company / In charge of Specific Business of Strategic Planning Group | |||||
Yasuhiko Ushikubo | 53 | Managing Executive Officer | Head of Research & Consulting Unit | |||||
Naoshi Inomata | 53 | Managing Executive Officer | Head of Strategic Planning Group (Group CSO) / In charge of Specially Assigned Matters | |||||
Masaomi Takada | 53 | Managing Executive Officer | Head of Compliance Group (Group CCO) |
(1) | Executive officers concurrently serving as directors. |
(2) | Representative Executive Officer. |
2017; and General Manager of Retail Banking Coordination Division from April 2012 to April 2015.
Junichi Kato has been Senior Managing Executive Officer / Head of Global Markets Company since April 2016. Previously, he had been in charge of similar responsibilities from April 2009 to April 2016; and President & CEO of Mizuho Bank (Switzerland), Ltd.Mr. Katsunobu Motohashi has been Senior Managing Executive Officer / Head of Asset Management Company since April 2016. Previously, he had been in charge of similar responsibilities from April 2010 to April 2016; and General Manager of Treasury Department of Mizuho Trust & Banking from April 2007 to April 2010. He concurrently serves as Senior Managing Executive Officer of Mizuho Bank.Mr. Akira Nakamura has been Senior Managing Executive Officer / Head of Corporate & Institutional Company since April 2018. Previously, he had been in charge of similar responsibilities from April 2016 to April 2018; and Head of Telecom Media Technology Group and in charge of Investment Banking Business of Mizuho Securities from April 2015 to April 2016. He concurrently serves as Senior Managing Executive Officer of Mizuho Bank.Mr. Seiji Imai Hiroshi NagamineApril 2018.May 2020. Previously, he had been Head of Asia & OceaniaEurope, Middle East and Africa or in charge of similar responsibilities from April 2016 to April 2018;May 2020; and General Manager of Seoul BranchCorporate Banking Division No.13 of Mizuho Bank from April 2014 to April 2016. He concurrently serves as Senior Managing Executive Officer of Mizuho Bank.
October 2016. He concurrently serves as Managing Executive Officer of Mizuho Bank.
Bank and President & CEO of Mizuho Research Institute Ltd.
Bank and Mizuho Trust & Banking.
Bank and Mizuho Trust & Banking.
of incorporation did not specify otherwise. The shareholders’ approval specified the upper limit of the aggregate amount of compensation and included the description of benefits in kind. Compensation for a director or audit & supervisory board member was fixed by the Board of Directors or by consultation among audit & supervisory board members in accordance with Mizuho Financial Group’s internal regulations and practice and, in the case of retirement allowances, generally reflected the position of the director or audit & supervisory board member at the time of retirement, the length of his service as a director or audit & supervisory board member and his contribution to the company’s performance.
Classification | Number of Persons (Note 2) | Aggregate Amount of Compensation (in millions of yen) (Note 3) | Aggregate Amounts of Compensation by Type (in millions of yen) | |||||||||||||||||||||||||||||||||||||
For the fiscal year ended March 31, 2018 | For the fiscal year ended March 31, 2017 | |||||||||||||||||||||||||||||||||||||||
Basic Salaries | Other | Performance Payments | Stock Compensation | |||||||||||||||||||||||||||||||||||||
Number of Persons | Amount | Number of Persons | Amount | Number of Persons | Amount | Number of Persons | Amount | |||||||||||||||||||||||||||||||||
Directors | 10 | 289 | 10 | 270 | 8 | 0 | 1 | 9 | 1 | 9 | ||||||||||||||||||||||||||||||
Executive officers as defined in the Companies Act | 19 | 1,299 | 19 | 827 | 19 | 1 | 19 | 236 | 19 | 234 |
Classification | Number of Persons (Note 2) | Aggregate Amount of Compensation (in millions of yen) (Note 3) | Aggregate Amounts of Compensation by Type (in millions of yen) | |||||||||||||||||||||||||||||||||||||||||||||
For the fiscal year ended March 31, 2020 | For the fiscal year ended March 31, 2019 | |||||||||||||||||||||||||||||||||||||||||||||||
Basic Salaries | Stock Compensation I (paid or expected to be paid at the time of retirement) | Other | Performance Payments | Stock Compensation II (paid during the term in office) | ||||||||||||||||||||||||||||||||||||||||||||
Number of Persons | Amount | Number of Persons | Amount | Number of Persons | Amount | Number of Persons | Amount | Number of Persons | Amount | |||||||||||||||||||||||||||||||||||||||
Directors | 12 | 302 | 12 | 263 | 9 | 38 | 12 | 0 | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Executive officers as defined in the Companies Act | 16 | 588 | 12 | 410 | 12 | 106 | 12 | 0 | 11 | 34 | 11 | 36 |
(1) | Fractions are rounded down. |
(2) | With respect to the number of persons, the directors and executive officers as defined in the Companies Act who were actually paid or expected to be paid for the fiscal years ended March 31, |
(3) | With respect to the amounts, the aggregate amounts paid or expected to be paid for the fiscal years ended March 31, |
(4) | The aggregate compensation paid to directors who concurrently serve as executive officers as defined in the Companies Act is included in the above table as those of “Executive officers as defined in the Companies Act.” |
(5) |
(6) | With respect to the |
|
Group) by the book value of Mizuho Financial Group stock |
(7) | The |
(8) | Because the amount of the performance payments and stock compensation II to be paid with respect to the fiscal year ended March 31, |
The |
(9) | With respect to the performance payments for executive officers as defined in the |
(10) | With respect to the Stock Compensation II for the executive officers as defined in the Companies Act, the amounts given are obtained by multiplying the stock ownership points granted by the Compensation Committee of Mizuho Financial Group in July 2019 based on each position and performance, as the stock ownership points granted for the fiscal year ended March 31, 2019 by the book value of Mizuho Financial Group stock (¥158.2734 per share). Stock Compensation for the fiscal year 2018 is expected to be paid as deferred payments over three years from the fiscal year 2020. |
Aggregate Amounts of Compensation by Type (in millions of yen) | ||||||||||||
Aggregate Amount of Compensation (in millions of yen) | For the fiscal year ended March 31, 2018 | For the fiscal year ended March 31, 2017 | ||||||||||
Name (Classification) | Company | Basic Salary | Other | Performance Payments | Stock Compensation | |||||||
Yasuhiro Sato (Executive officer as defined in the Companies Act) | 126 |
Mizuho Financial Group | 69 | 0 | 22 | 22 | ||||||
Mizuho Bank | 3 | — | 1 | 1 | ||||||||
Mizuho Trust & Banking | 1 | — | 0 | 0 | ||||||||
Mizuho Securities | 2 | — | 0 | 0 |
Note:
equaled or exceeded the foregoing amount in the fiscal year ended March 31, 2020.
2020.
2020.
2020.
2020.
2020.
1) | The executive compensation shall be determined based on appropriate governance and control, and function as an appropriate incentive in order to realize management that contributes to value creation for various stakeholders and improve corporate value through continuous and stable corporate growth based on our basic management policies under our Corporate Philosophy. |
2) | The executive compensation shall be based on the function and responsibility assigned to and the performance of each Officer, etc. |
3) | The executive compensation shall contribute to suppressing excessive risk-taking, improving corporate value and creating value for various stakeholders not only in the short-term, but also over the medium- to long-term. |
4) | The executive compensation shall reflect the management environment and business performance of our group. |
5) | The executive compensation shall enable compensation for securing expert personnel such as professionals with a competitive edge in the market. |
6) | The compensation system and standards shall be timely and appropriately reevaluated and set at a competitive and appropriate standard based on such factors as the economic and social conditions and survey data with respect to management compensation provided by external specialized organizations. |
7) | Regulations and guidelines, etc., concerning executive compensation, both in Japan and overseas, shall be complied with. |
1) | “Basic Salaries” shall factor in the function and responsibility of each Officer, etc., in addition to the standard amount for each position and payment will be made monthly in cash. |
2) | “Performance Payments” shall be made as a monetary incentive for Officers, etc., to achieve the annual budget and as compensation for their achievement. The payment thereof shall reflect in-house companies and units, etc.) that each Officer, etc., is in charge of and the performance |
3) | “Stock Compensation” shall be paid in the form of shares of common stock of Mizuho Financial Group consisting of “Stock Compensation I” and “Stock Compensation II,” (together “Stock Compensation I and II”) acquired from the stock market through a trust with an aim to align the interests of Officers, etc., with those of the shareholders and increase the incentive to enhance corporate value. |
(a) | “Stock Compensation I” shall be paid at the time of retirement of each Officer, etc., in the form of shares of common stock of Mizuho Financial Group calculated based on each position. A system shall be adopted which enables a decrease or forfeiture of the amount by resolution of the Compensation Committee, etc., depending on performance of the company or the individual. |
(b) | “Stock Compensation II” shall be paid in accordance with the status of achieving our |
1) | The basic compensation system for Officers Responsible for Business Execution shall be a “Basic Salary,” “Performance Payment” and “Stock Compensation I and II.” |
(a) | The composition of the compensation shall, in principle, be 50%, 17.5% and 32.5% for “Basic Salary,” “Performance Payment” and “Stock Compensation I and II” respectively. |
(b) |
*The amount of funds for “Performance Payment” and “Stock Compensation II” is decided for each fiscal year by multiplying the standard amount for each position in a respective year with the total number of officers in that year and a coefficient based on the result from the fiscal year’s
results of operations. The evaluation metric for this coefficient is decided by setting metrics based on our Consolidated Net Business Profits, and using such evaluation metrics for the reference year and the current fiscal year (provided that, for Mizuho Securities Co., Ltd., the system is linked to Ordinary Income, which is a metric that is equivalent to Consolidated Net Business Profits based on the traits of business activities and financial structure of securities companies).
(c) | “Stock Compensation II” shall be paid, in principle, within the range of 0% to 130% of the standard amount for each position. |
2) | The compensation for Non-Executive Officers Responsible for Management Supervision, in principle, shall be in the form of fixed compensation from the perspective of ensuring the effectiveness of the |
supervisory function. The compensation system shall consist of “Basic Salaries” and “Stock Compensation” and the composition shall, in principle, be 85% and 15% for “Basic Salaries” and “Stock Compensation,” respectively. |
systems (regarding matters such as risk management, compliance and internal auditing) and risk governance systems of our group. The Board of Directors shall, in principle, delegate to the President & CEO, who is also the Group CEO, decisions on business execution (excluding matters that are legally required to be determined solely by the Board of Directors), for the purpose of realizing swift and flexible decision-making and expeditious corporate management and strengthening the supervision of directors and executive officers by the Board of Directors.
Tatsuo Kainaka.
Auditor, and appointment of the General Manager of the Internal Audit Group.
AllHisaaki Hirama.
laws.
appointment and removal of or commission to Mizuho Financial Group’s executive officers (as defined in the Companies Act or our internal regulations) with special titles, such plans to be decided upon by the Board of Directors. Additionally, the Human Resources Review Meeting shall deliberate over plans for the appointment and removal of or commission to the Three Core Companies’ executive officers as defined in our internal regulations with special titles, such plans to be approved by the Board of Directors.
2020.
Business segment | Number of full-time employees | Average number of temporary employees | ||||||
Retail & Business Banking Company | 24,526 | 12,417 | ||||||
Corporate &Institutional Company | 2,145 | 354 | ||||||
Global Corporate Company | 8,645 | 67 | ||||||
Global Markets Company | 1,591 | 115 | ||||||
Asset Management Company | 1,669 | 147 | ||||||
Others | 21,475 | 6,976 | ||||||
|
|
|
| |||||
Total | 60,051 | 20,076 | ||||||
|
|
|
| |||||
Location | Percentage of full-time employees | Average percentage of temporary employees | ||||||
Japan | 91.5 | % | 99.8 | % | ||||
Americas | 2.3 | 0.0 | ||||||
Europe | 1.4 | 0.1 | ||||||
Asia/Oceania (excluding Japan) and others | 4.8 | 0.1 | ||||||
|
|
|
| |||||
Total | 100.0 | % | 100.0 | % | ||||
|
|
|
|
Business segment | Number of full-time employees | Average number of temporary employees | ||||||
Retail & Business Banking Company | 24,067 | 10,614 | ||||||
Corporate & Institutional Company | 2,206 | 313 | ||||||
Global Corporate Company | 8,873 | 43 | ||||||
Global Markets Company | 1,545 | 77 | ||||||
Asset Management Company | 1,592 | 127 | ||||||
Others | 18,981 | 5,836 | ||||||
Total | 57,264 | 17,010 | ||||||
Location | Percentage of full-time employees | Average percentage of temporary employees | ||||||
Japan | 90.4 | % | 99.9 | % | ||||
Americas | 2.8 | 0.0 | ||||||
Europe | 1.5 | 0.1 | ||||||
Asia/Oceania (excluding Japan) and others | 5.3 | 0.0 | ||||||
Total | 100.0 | % | 100.0 | % | ||||
Directors | Actual number of shares held | Potential number of additional shares to be held | ||||||
Tatsufumi Sakai | 308,538 | 120,388 | ||||||
Takanori Nishiyama | 130,925 | 73,857 | ||||||
Makoto Umemiya | 34,755 | 74,124 | ||||||
Yasuyuki Shibata | 49,500 | 69,070 | ||||||
Hisashi Kikuchi | 48,200 | 37,868 | ||||||
Yasuhiro Sato | 890,412 | 677,640 | ||||||
Ryusuke Aya | 218,192 | 123,454 | ||||||
Nobukatsu Funaki | 77,115 | 198,422 | ||||||
Tetsuo Seki | 33,400 | — | ||||||
Takashi Kawamura | 130,000 | — | ||||||
Tatsuo Kainaka | 22,400 | — | ||||||
Hirotake Abe | 33,400 | — | ||||||
Hiroko Ota | 5,000 | — | ||||||
Izumi Kobayashi | 4,500 | — | ||||||
Executive Officers | Actual number of shares held | Potential number of additional shares to be held | ||||||
Tatsufumi Sakai | See above | See above | ||||||
Toshitsugu Okabe | 688,495 | 262,923 | ||||||
Daisaku Abe | 308,457 | 458,450 | ||||||
Junichi Kato | 611,011 | 127,745 | ||||||
Katsunobu Motohashi | 249,365 | 199,015 | ||||||
Akira Nakamura | 191,062 | 99,651 | ||||||
Seiji Imai | 52,600 | 134,497 | ||||||
Tsutomu Nomura | 305,794 | 91,940 | ||||||
Takanori Nishiyama | See above | See above | ||||||
Motonori Wakabayashi | 14,040 | 81,381 | ||||||
Goji Fujishiro | 31,692 | 79,879 | ||||||
Shuji Kojima | 65,796 | 81,544 | ||||||
Makoto Umemiya | See above | See above | ||||||
Yasuyuki Shibata | See above | See above | ||||||
Hisashi Kikuchi | See above | See above |
Directors | Actual number of shares held | Potential number of additional shares to be held | ||||||
Tatsufumi Sakai | 374,216 | 226,016 | ||||||
Satoshi Ishii | 288,511 | 166,997 | ||||||
Motonori Wakabayashi | 61,965 | 150,211 | ||||||
Makoto Umemiya | 77,804 | 124,674 | ||||||
Hiroaki Ehara | 94,213 | 132,338 | ||||||
Yasuhiro Sato | 1,020,160 | 578,794 | ||||||
Hisaaki Hirama | 171,834 | 82,646 | ||||||
Tetsuo Seki | 61,959 | 23,700 | ||||||
Tatsuo Kainaka | 31,200 | 23,700 | ||||||
Yoshimitsu Kobayashi | — | — | ||||||
Ryoji Sato | 5,000 | — | ||||||
Masami Yamamoto | 28,555 | 12,500 | ||||||
Izumi Kobayashi | 18,735 | 23,700 |
Executive Officers | Actual number of shares held | Potential number of additional shares to be held | ||||||
Tatsufumi Sakai | See above | See above | ||||||
Seiji Imai | 180,627 | 161,943 | ||||||
Satoshi Ishii | See above | See above | ||||||
Masahiro Otsuka | 155,769 | 62,400 | ||||||
Naofumi Fuke | 70,124 | 226,845 | ||||||
Hiroshi Nagamine | 40,007 | 85,074 | ||||||
Motonori Wakabayashi | See above | See above | ||||||
Makoto Umemiya | See above | See above | ||||||
Hisashi Kikuchi | 77,150 | 130,076 | ||||||
Hiroaki Ehara | See above | See above | ||||||
Masatoshi Yoshihara | 148,198 | 119,364 | ||||||
Yasuhiro Shibata | — | 107,581 | ||||||
Masamichi Ishikawa | 79,845 | — | ||||||
Yasuhiko Ushikubo | 6,216 | 99,775 | ||||||
Naoshi Inomata | — | 34,700 | ||||||
Masaomi Takada | 5,920 | 79,812 |
As of March 31, 2020 | ||||||
Plan | Employer companies | Number of shares owned | ||||
Mizuho Employee Stock Ownership Plan | Mizuho Financial Group | |||||
Mizuho Bank | ||||||
Mizuho Trust & Banking | ||||||
Mizuho Research Institute | ||||||
Mizuho Information & Research Institute | ||||||
| ||||||
|
| |||||
|
| |||||
Total | 116,088,567 | |||||
ITEM 7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS |
Name The Master Trust Bank of Japan, Ltd. (trustee account) Japan Trustee Services Bank, Ltd. (trustee account) Japan Trustee Services Bank, Ltd. (trustee account 5) Japan Trustee Services Bank, Ltd. (trustee account 9) State Street Bank West Client – Treaty 505234 Japan Trustee Services Bank, Ltd. (trustee account 1) Japan Trustee Services Bank, Ltd. (trustee account 2) JP Morgan Chase Bank 385151 Japan Trustee Services Bank, Ltd. (trustee account 7) Japan Trustee Services Bank, Ltd. (trustee account 4) Total 2020: 2020.2018: As of March 31, 2018 Number of
shares owned Percentage of
outstanding shares 1,070,043,700 4.22 % 1,054,777,400 4.16 512,108,700 2.02 479,711,500 1.89 453,273,840 1.79 381,129,200 1.50 374,905,000 1.48 341,932,527 1.35 325,656,600 1.28 308,675,100 1.22 5,302,213,567 20.89 % % % 2018,2020, there were 220206 record holders of our common stock with addresses in the United States, whose shareholdings represented approximately 10%9% of our outstanding common stock on that date. Because some of these shares were held by brokers or other nominees, the number of record holders with addresses in the United States might not fully reflect the number of beneficial owners in the United States.2018,2020, such transactions included, but were not limited to, call money, loans, deposits, guarantees and foreign exchange transactions, those transactions were immaterial and were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and did not involve more than the normal risk of collectability or present other unfavorable features.2018,2020, none of the directors or executive officers, and none of the close members of their respective families, had any transactions that are material or any transactions that are unusual in their nature or conditions, involving goods, services or tangible or intangible assets, to which we were, are or will be a party, and there were no such transactions proposed as of March 31, 2018.2018,2020, no loans were made to the directors or executive officers other than loans in the ordinary course of business, on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons, and involving no more than the normal risk of collectability or presenting other unfavorable features.
ITEM 8. | FINANCIAL INFORMATION |
that an adverse decision in one or more of these lawsuits will not have a material adverse effect. year. Annual cash dividends for the fiscal year ended March 31, 2020 were decided by a resolution of our Board of Directors. However, with the approval by our shareholders at the 18th Ordinary general meeting of shareholders held in June 2020, our articles of incorporation was amended such that, unless otherwise stipulated by laws and regulations, the Board of Directors remains as the organization to make decisions on issuing dividends, but the general meeting of shareholders may also make decisions on such matters in the event a shareholder’s proposal is presented. For more information on such amendment to our articles of incorporation, see “Item 10.B. Memorandum and Articles of Association—Common Stock—Distribution of Surplus”.business. In addition, we are involved in the following legal proceeding.An Indonesian subsidiarybusiness, none of ours acts as collateral agent for the trustee of bond issuances made by subsidiaries of Asia Pulp & Paper Company Ltd. (“APP”). In that role, the subsidiarywhich is involved in a dispute between the bondholders and such APP subsidiaries in their capacities as the issuers, guarantors and/or pledgors of security for the bonds relatingcurrently expected to foreclosure proceedings on the collateral and has been named as a defendant in a lawsuit brought by the obligors under the bonds in Indonesia. Our consolidated financial statements do not include a reserve in relation to this dispute because we do not believe the resolution of this matter will have a significant impactmaterial adverse effect on our consolidated financial condition or results of operations, althoughoperations.as to the foregoing.20182020 were ¥7.5 per share of common stock (interim (each of interim andof ¥3.75 per share of common stock andyear-end cash dividends ofwas ¥3.75 per share of common stock), which was the same amount as the annual cash dividends per share of common stock of theprevious fiscal year ended March 31, 2017.distributeissue dividends twice per year to shareholders of recordrecorded in the shareholder register as of March 31 and September 30 in each year asdetermine dividend payments of surplusdecide to issue dividends not by a resolution at a general meeting of shareholders but by a resolution of our Board of Directors, unless otherwise provided for instipulated by laws or regulations.regulationregulatory trends, such asincluding the Basel framework, and determine cash dividend payments for each term.
ITEM 9. | THE OFFER AND LISTING |
Fiscal years ended March 31, (shares) 2014 2015 2016 2017 2018 2017: First quarter Second quarter Third quarter Fourth quarter 2018: First quarter Second quarter Third quarter Fourth quarter Most recent six months: December January February March April May Fiscal years ended March 31, (shares) 2014 2015 2016 2017 2018 2017: First quarter Second quarter Third quarter Fourth quarter 2018: First quarter Second quarter Third quarter Fourth quarter Most recent six months: December January February March April MayMarket Price Information for Our American Depositary SharesOur ADSs are listed on the New York Stock Exchange.The following table sets forth, for the periods indicated, the high and low trading prices and average daily trading volume on the New York Stock Exchange for our ADSs: Price per ADS Average daily
trading volume High Low 4.55 3.62 556,105 4.17 3.22 352,911 4.51 2.72 608,446 3.87 2.69 426,812 4.00 3.37 285,536 3.30 2.69 814,598 3.71 2.76 293,004 3.87 3.17 334,969 3.85 3.56 257,964 3.76 3.47 349,014 3.72 3.37 251,729 3.76 3.46 181,256 4.00 3.54 362,590 3.76 3.57 200,194 4.00 3.62 433,467 3.87 3.54 383,575 3.77 3.59 272,728 3.69 3.53 333,099 3.70 3.46 253,515 Market Prices Information for Our SharesSee “Item 9.C. The Offer and Listing—Markets” for information on the stock exchanges on which our common stock is listed.The following table sets forth, for the periods indicated, the high and low trading prices and average daily trading volume on the First Section of the Tokyo Stock Exchange for our common stock: Price per share(1) Average daily
trading volume High Low 240 180 186,546,095 226.6 178.1 132,018,080 280.4 149.3 200,523,432 225.3 142.0 162,921,802 220.7 185.4 127,920,473 185.7 142.6 160,817,541 186.4 142.0 160,435,263 225.3 163.5 201,903,957 217.3 204.0 128,571,211 210.7 186.7 115,420,966 208.9 185.4 108,518,360 210.0 194.7 141,275,285 220.7 189.1 147,410,341 208.6 199.8 129,917,095 220.7 205.2 147,543,079 211.5 193.8 157,500,153 198.3 189.1 138,161,367 200.6 188.0 102,114,325 203.3 189.1 97,854,567 Note:(1)Since July 22, 2014, Tokyo Stock Exchange has introduced sub-yen tick sizes for the shares of TOPIX 100 constituents, which contain decimals. Our shares are included in the TOPIX 100 constituents.Not applicable.ITEM 10.
Set
We adopted this process based on the idea that our Board of Directors, with its high level of supervisory function and extensive expertise, would maximize
“C” = (if we have reduced our stated capital after the end of the last fiscal year) the amount of such reduction less the portion thereof that has been transferred to additional
2020.
resolution of a general meeting of shareholders and, if so decided by the same resolution, may account for the whole or any part of the amount of such reduction as additional
representative director at least eight weeks prior to the date of such meeting. Any of the minimum percentages, time periods and number of voting rights necessary for exercising the minority shareholder rights described above may be decreased or shortened if our articles of incorporation so provide.
1. | any amendment to our articles of incorporation (except for such amendments that may be authorized by executive officers under the authority delegated by the board of directors under the Companies Act such as (i) an increase of the number of authorized shares in the same ratio as that of a stock split, (ii) a reduction of the number of shares per unit of shares and (iii) abolishing the unit share system); |
2. | our dissolution, merger or consolidation requiring shareholders’ approval; |
3. | establishment of a parent and wholly-owned subsidiary relationship by way of a share transfer ( kabushiki-iten kabushiki-kokan |
4. | transfer of the whole or a substantial part of our business; |
5. | transfer of the whole or a part of our shares in any of our subsidiaries requiring shareholders’ approval; |
6. | taking over of the whole of the business of another company requiring shareholders’ approval; |
7. | our corporate split requiring shareholders’ approval; |
8. | consolidation of shares of common stock; |
9. | acquisition of shares of common stock by us from a specific shareholder other than our subsidiary; |
10. | distribution of Surplus in kind (except when shareholders are granted the right to require to make such distribution in cash instead of in kind); |
11. | issuance or transfer of new shares or existing shares held by us as treasury stock to persons other than the shareholders at a “specially favorable” price; and |
12. | issuance of stock acquisition rights (including those incorporated in bonds with stock acquisition rights) to persons other than the shareholders at a “specially favorable” price or under “specially favorable” conditions. |
week’sweeks’ prior public notice, we may at any time set a record date in order to determine the shareholders who are entitled to certain rights pertaining to our stock.
1. | by way of purchase on any Japanese stock exchange on which the shares of our common stock are listed or by way of tender offer (in either case pursuant to a resolution of the Board of Directors as long |
as our |
2. | from a specific shareholder other than any of our subsidiaries (pursuant to a special resolution of a general meeting of shareholders); or |
3. | from any of our subsidiaries (pursuant to a determination by executive officers under the authority delegated by the Board of Directors). |
The
(i) | an amendment to the articles of incorporation to add new classes of shares to be issued, alter the terms of the shares or increase the number of authorized number of shares or authorized number of any class of shares, with certain exceptions; |
(ii) | consolidation or split of shares; |
(iii) | pro rated allocation of shares or stock acquisition rights to shareholders without any consideration; |
(iv) | granting pre-emptive rights for new shares or stock acquisition rights to shareholders; |
(v) | amalgamations or mergers; |
(vi) | certain corporate splits; |
(vii) | share exchanges; |
(viii) | share transfers; and |
(ix) | other matters set forth in the articles of incorporation. |
the holders of the common stock or the preferred stock, as the case may be, is the same date as the record date for the ordinary general meeting of shareholders, when is March 31 of each year.
The
withholding tax rate of 15% and 20%, as applicable, has been effectively increased, respectively, to 15.315% and 20.42%, during the period beginning on January 1, 2013 and ending on December 31, 2037.
treated as a qualified foreign corporation with respect to dividends paid by that corporation on shares (or ADSs backed by such shares) that are readily tradable on an established securities market in the United States. United States Treasury Department guidance indicates that our ADSs (which are listed on the New York Stock Exchange), but not the shares, are readily tradable on an established securities market in the United States. There can be no assurance that our ADSs will be considered readily tradable on an established securities market in later years.
If we are a PFIC for any taxable year during which a U.S. holder holds shares or ADSs, the U.S. holder will be subject to special tax rules with respect to any “excess distribution” that the U.S. holder receives and any gain the U.S. holder realizes from the sale or other disposition (including a pledge) of shares or ADSs. Additionally,
information by attaching a complete IRS Form 8938, Statement of Specified Foreign Financial Assets, on their tax return for each year in which they hold shares or ADSs could become subject to substantial penalties. Potential investors are urged to consult with their own tax advisors regarding the possible implications of these rules on their investment in shares or ADSs.
ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT CREDIT, MARKET AND OTHER RISK |
As for the situation of market risk, the
risk, the middle offices manage risk using additional risk indices, carry out stress testing and set stop loss limits as needed. We monitor market liquidity risk for individual financial products in the market while taking turnover and other factors into consideration.
Fiscal year ended March 31, 2016 | As of March 31, 2016 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 1.8 | ¥ | 3.7 | ¥ | 0.6 | ¥ | 1.1 | ||||||||
Foreign exchange | 0.9 | 2.3 | 0.2 | 0.3 | ||||||||||||
Equities | 0.6 | 2.5 | 0.1 | 0.3 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | ¥ | 2.9 | ¥ | 4.5 | ¥ | 1.8 | ¥ | 2.0 | ||||||||
|
|
|
|
|
|
|
|
Fiscal year ended March 31, 2017 | As of March 31, 2017 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 2.0 | ¥ | 3.6 | ¥ | 1.0 | ¥ | 1.0 | ||||||||
Foreign exchange | 0.5 | 1.6 | 0.1 | 0.1 | ||||||||||||
Equities | 0.4 | 3.2 | 0.1 | 0.9 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | ¥ | 3.3 | ¥ | 5.8 | ¥ | 2.3 | ¥ | 2.6 | ||||||||
|
|
|
|
|
|
|
|
Fiscal year ended March 31, 2018 | As of March 31, 2018 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 1.7 | ¥ | 2.5 | ¥ | 1.0 | ¥ | 2.2 | ||||||||
Foreign exchange | 0.4 | 1.2 | 0.1 | 0.1 | ||||||||||||
Equities | 0.6 | 2.4 | 0.3 | 0.5 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | ¥ | 3.0 | ¥ | 6.2 | ¥ | 2.2 | ¥ | 3.0 | ||||||||
|
|
|
|
|
|
|
|
Fiscal year ended March 31, 2018 | As of March 31, 2018 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 1.7 | ¥ | 2.5 | ¥ | 1.0 | ¥ | 2.2 | ||||||||
Foreign exchange | 0.4 | 1.2 | 0.1 | 0.1 | ||||||||||||
Equities | 0.6 | 2.4 | 0.3 | 0.5 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Total | ¥ | 3.0 | ¥ | 6.2 | ¥ | 2.2 | ¥ | 3.0 | ||||||||
Fiscal year ended March 31, 2019 | As of March 31, 2019 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 2.0 | ¥ | 2.9 | ¥ | 1.3 | ¥ | 2.0 | ||||||||
Foreign exchange | 0.8 | 2.8 | 0.1 | 0.3 | ||||||||||||
Equities | 0.6 | 7.7 | 0.2 | 0.5 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Total | ¥ | 3.4 | ¥ | 9.2 | ¥ | 2.4 | ¥ | 2.6 | ||||||||
Fiscal year ended March 31, 2020 | As of March 31, 2020 | |||||||||||||||
Risk category | Daily average | Maximum | Minimum | |||||||||||||
(in billions of yen) | ||||||||||||||||
Interest rate | ¥ | 2.7 | ¥ | 7.2 | ¥ | 1.3 | ¥ | 6.7 | ||||||||
Foreign exchange | 0.4 | 1.1 | 0.1 | 0.8 | ||||||||||||
Equities | 0.6 | 4.5 | 0.2 | 1.7 | ||||||||||||
Commodities | 0.0 | 0.0 | 0.0 | 0.0 | ||||||||||||
Total | ¥ | 3.8 | ¥ | 11.8 | ¥ | 2.3 | ¥ | 8.3 | ||||||||
2020:
Fiscal years ended March 31, | ||||||||||||||||
2016 | 2017 | 2018 | Change | |||||||||||||
(in billions of yen) | ||||||||||||||||
As of fiscal year end | ¥ | 2.0 | ¥ | 2.6 | ¥ | 3.0 | ¥ | 0.4 | ||||||||
Maximum | 4.5 | 5.8 | 6.2 | 0.3 | ||||||||||||
Minimum | 1.8 | 2.3 | 2.2 | (0.1 | ) | |||||||||||
Average | 2.9 | 3.3 | 3.0 | (0.3 | ) |
Fiscal years ended March 31, | ||||||||||||||||
2018 | 2019 | 2020 | Change | |||||||||||||
(in billions of yen) | ||||||||||||||||
As of fiscal year end | ¥ | 3.0 | ¥ | 2.6 | ¥ | 8.3 | ¥ | 5.6 | ||||||||
Maximum | 6.2 | 9.2 | 11.8 | 2.5 | ||||||||||||
Minimum | 2.2 | 2.4 | 2.3 | (0.1 | ) | |||||||||||
Average | 3.0 | 3.4 | 3.8 | 0.4 |
2020:
Fiscal years ended March 31, | ||||||||||||||||
2016 | 2017 | 2018 | Change | |||||||||||||
(in billions of yen) | ||||||||||||||||
As of fiscal year end | ¥ | 321.5 | ¥ | 292.7 | ¥ | 268.4 | ¥ | (24.3 | ) | |||||||
Maximum | 360.6 | 397.5 | 307.2 | (90.2 | ) | |||||||||||
Minimum | 190.0 | 247.4 | 210.8 | (36.6 | ) | |||||||||||
Average | 284.9 | 331.0 | 267.8 | (63.2 | ) |
Fiscal years ended March 31, | ||||||||||||||||
2018 | 2019 | 2020 | Change | |||||||||||||
(in billions of yen) | ||||||||||||||||
As of fiscal year end | ¥ | 268.4 | ¥ | 194.4 | ¥ | 361.4 | ¥ | 166.9 | ||||||||
Maximum | 307.2 | 298.5 | 361.4 | 62.8 | ||||||||||||
Minimum | 210.8 | 194.4 | 167.9 | (26.4 | ) | |||||||||||
Average | 267.8 | 255.5 | 215.7 | (39.8 | ) |
Note: | We conduct our back testing and assess the number of cases where losses exceed VAR based on a 250 business day year. The expected average number of instances where one-day trading losses exceeded VAR at the 99% confidence level is 2.5. |
| ||||
Definition | Principal Risk Management Methods | |||
Information Technology Risk | Information technology risk (“IT risk”) shall refer to the risk that problems (e.g. malfunctions, disruptions, etc.) with the computer systems or improper use of the computers in these systems, which cause disruptions of the services provided to customers, or have significant impact on settlement systems, etc., will result in losses for customers, and the incurrence of losses (tangible or intangible) by our group companies. | • Identify and evaluate the risk by setting specific standards that need to be complied with and implementing measures tailored based on evaluation results to reduce the risk.• Ensure ongoing project management in systems development and quality control.• Strengthen security to prevent information leaks.• Strengthen capabilities for rapidly and effectively dealing with cyberattacks. |
Definition | Principal Risk Management Methods | |||
• Improve effectiveness of emergency responses by improving backup systems and holding drills. |
|
| |||
Operations Risk | The risk of customers | • Establish clearly defined procedures for handling operations.• Periodically check the status of operational processes.• Conduct training and development programs by headquarters.• Introduce information technology, office automation and centralization for operations.• Improve the effectiveness of emergency responses by holding drills. | ||
Legal Risk | Risk that the group may incur losses due to violation of laws and regulations, breach of contract, entering into improper contracts or other legal factors. | • Review and confirm legal issues, including the legality of material decisions, agreements and external documents, etc.• Collect and distribute legal information and conduct internal training programs.• Analyze and manage issues related to lawsuits. | ||
Human Resources Risk | Risk that the group may incur losses due to drain or loss of personnel, deterioration of morale, inadequate development of human resources, inappropriate working schedule, inappropriate working and safety environment, inequality or inequity in human resource management or discriminatory conduct. | • Conduct employee satisfaction surveys.• Understand the status of working hours.• Understand the status of vacation days taken by personnel.• Understand the status of voluntary resignations.• Understand the status of the stress check system. | ||
Tangible Asset Risk | Risk that the group may incur losses from damage to tangible assets or a decline in the quality of working environment as a result of disasters, criminal actions or defects in asset maintenance. | • Manage the planning and implementation of construction projects related to the repair and replacement of facilities.• Identify and evaluate the status of damage to tangible assets caused by natural disasters, etc., and respond appropriately to such damage. | ||
Regulatory Change Risk | Risk that the group may incur losses due to changes in various regulations or systems, such as those related to law, taxation and accounting. | • Understand important changes in regulations or systems that have significant influence on our business operations or financial condition in a timely and accurate manner. |
Definition | Principal Risk Management Methods | |||
• Analyze degree of influence of regulatory changes and establish countermeasures.• Continuously monitor our regulatory change risk management mentioned above. |
Reputational Risk |
|
| ||
Risk that the group may incur losses due to damage to our credibility or the value of the “Mizuho” brand when market participants or others learn about, or the media reports on, various adverse events, including actual materialization of risks or false rumors. | • Establish framework to identify and manage, on an integrated basis, information that may have a serious impact on group management and respond to such risk in a manner appropriate to its scale and nature.• Swiftly identify rumors and devise appropriate responses depending on the urgency and possible impact of the situation to minimize possible losses. |
result of combining, through a statistical approach (Extreme Value Theory), of the actual distribution for the low severity distribution portion created by internal loss data and another loss distribution
| ||||
Approach | Loss event type(s) to be applied | |||
A | Internal fraud / External fraud / Clients, products and business practices / Execution, delivery and process management | |||
B | Employment practices and workplace safety | |||
C | Damage to physical assets | |||
D | Business disruption and system failure |
compliance within such unit.
The Head of the Internal Audit Group reports the progress of individual audits and plans to the Audit Committee, responds to requests for inspections, and receives specific instructions from the committee. Our internal audit committeeInternal Audit Committee monitors and manages internal audits at our principal banking subsidiaries and other core group companies through internal audit reports submitted by such subsidiaries. Our internal audit committeeInternal Audit Committee discusses and makes decisions regarding internal audits at our principal banking subsidiaries and other core group companies and submits the results, together with the results of their examination of the internal audit reports, to the Audit Committee and our Board of Directors.
operations and a framework under which their internal audit committees coordinate with their respective audit & supervisory committees.
ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
depositary:depositary as of the date of this annual report: (1) (2)
Notes:
ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
ITEM 15. | CONTROLS AND PROCEDURES |
(i) | pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; |
(ii) | provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of management and directors; and |
(iii) | provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements. |
2020.
reporting other than noted below.
ITEM 16A. | AUDIT COMMITTEE FINANCIAL EXPERT |
ITEM 16B. | CODE OF ETHICS |
ITEM 16C. | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
Fiscal years ended March 31, | ||||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Audit fees(1) | ¥ | 4,800 | ¥ | 4,951 | ||||
Audit-related fees(2) | 406 | 306 | ||||||
Tax fees(3) | 117 | 213 | ||||||
All other fees(4) | 42 | 13 | ||||||
|
|
|
| |||||
Total | ¥ | 5,365 | ¥ | 5,483 | ||||
|
|
|
|
Fiscal years ended March 31, | ||||||||
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Audit fees (1) | ¥ | 5,253 | ¥ | 4,962 | ||||
Audit-related fees (2) | 273 | 248 | ||||||
Tax fees (3) | 102 | 80 | ||||||
All other fees (4) | 4 | 3 | ||||||
Total | ¥ | 5,632 | ¥ | 5,293 | ||||
(1) | Audit fees include primarily fees related to the audit of U.S. GAAP financial statements as well as Japanese GAAP financial statements used for home-country reporting purposes. |
(2) | Audit-related fees include fees for services relating to agreed-upon procedures on internal controls and due diligence services related to our securitization |
(3) | Tax fees include fees for services relating to the preparation of tax returns and tax advice. |
(4) | All other fees include fees for services relating to education to improve the financial business knowledge of our employees. |
| ||
General pre-approval | General pre-approval is required for services which are expected to be performed during a given fiscal year. Our audit committee reviews the specific maximum fee amount for new services and the maximum amount of increase/decrease from previous fee amounts for the same type of services as those performed in the past and authorizespre-approval at the beginning of each fiscal year. | |
| ||
Specific pre-approval | For those services which have not been approved pursuant to the general pre-approval procedure, specificpre-approval by our audit committee members is required prior to each engagement. With respect to such services, two full-time audit committee members must providepre-approval and report suchpre-approval at the monthly meeting of the audit committee. |
ITEM 16D. | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
ITEM 16E. | PURCHASE OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS |
Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Maximum number of shares that may yet be purchased under the plans or programs | |||||||||||||
April 1 to April 30, 2017 | 2,478 | ¥ | 195.5 | — | — | |||||||||||
May 1 to May 31, 2017 | 3,681 | 204.8 | — | — | ||||||||||||
June 1 to June 30, 2017 | 3,265 | 198.3 | — | — | ||||||||||||
July 1 to July 31, 2017 | 4,639 | 202.4 | — | — | ||||||||||||
August 1 to August 31, 2017 | 2,468 | 192.0 | — | — | ||||||||||||
September 1 to September 30, 2017 | 2,122 | 189.8 | — | — | ||||||||||||
October 1 to October 31, 2017 | 2,573 | 198.8 | — | — | ||||||||||||
November 1 to November 30, 2017 | 3,189 | 203.0 | — | — | ||||||||||||
December 1 to December 31, 2017 | 10,012 | 204.7 | — | — | ||||||||||||
January 1 to January 31, 2018 | 7,645 | 212.6 | — | — | ||||||||||||
February 1 to February 28, 2018 | 4,207 | 203.9 | — | — | ||||||||||||
March 1 to March 31, 2018 | 2,783 | 196.0 | — | — | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 49,062 | ¥ | 202.5 | — | — | |||||||||||
|
|
|
|
|
|
|
|
2020:
Total number of shares purchased | Average price paid per share | Total number of shares purchased as part of publicly announced plans or programs | Maximum number of shares that may yet be purchased under the plans or programs | |||||||||||||
April 1 to April 30, 2019 | 19,244 | ¥ | 173.9 | — | — | |||||||||||
May 1 to May 31, 2019 | 10,057 | 169.9 | — | — | ||||||||||||
June 1 to June 30, 2019 | 3,115 | 153.3 | — | — | ||||||||||||
July 1 to July 31, 2019 | 3,291 | 157.3 | — | — | ||||||||||||
August 1 to August 31, 2019 | 1,805 | 155.3 | — | — | ||||||||||||
September 1 to September 30, 2019 | 2,092 | 163.1 | — | — | ||||||||||||
October 1 to October 31, 2019 | 932 | 164.8 | — | — | ||||||||||||
November 1 to November 30, 2019 | 2,740 | 170.4 | — | — | ||||||||||||
December 1 to December 31, 2019 | 3,204 | 169.8 | — | — | ||||||||||||
January 1 to January 31, 2020 | 4,286 | 165.4 | — | — | ||||||||||||
February 1 to February 29, 2020 | 15,325 | 162.2 | — | — | ||||||||||||
March 1 to March 31, 2020 | 7,056 | 134.3 | — | — | ||||||||||||
Total | 73,147 | ¥ | 163.8 | — | — | |||||||||||
(1) | A total of |
ITEM 16F. | CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT |
ITEM 16G. | CORPORATE GOVERNANCE |
not require Mizuho Financial Group to have a majority of “independent” directors on the board; rather, it requires the company to have a majority of “outside” directors on each of the Nominating Committee, the Compensation Committee and the Audit Committee, each established as a committee, pursuant to the requirements that apply to a Company with Three Committees. An outside director is defined under the Companies Act as a director who meets all of the following requirements: (a) a person who is not currently, and has not been in the ten years prior to his or her assumption of office as outside director, an executive director, an executive officer, a manager, or any other type of employee (“Executive Director, etc.”) of the company or its subsidiaries; (b) if a person has been a non-executive director, an audit & supervisory board member, or an accounting adviser of the company or its subsidiaries within the ten years prior to his or her assumption of office as outside director, a person who was not an Executive Director, etc., of the company or its subsidiaries in the ten years prior to his or her assumption of office as such; (c) a person who is not (i) a person who controls the company (including the company’s parent company) (“Parent Company, etc.”) and who is a natural person or (ii) a director, an executive officer, a manager or any other type of employee of a Parent Company, etc.; (d) a person who is not an Executive Director, etc., of another subsidiary of a Parent Company, etc.; and (e) a person who is not a spouse or a family member within the second degree of kinship of (i) a director, an executive officer, a manager, or any other type of important employee of the company or (ii) a Parent Company, etc., who is a natural person. In addition to the requirements under the Companies Act, Mizuho Financial Group’s independence standards for outside directors set forth additional independence requirements on a voluntary basis. Such additional requirements include, but are not limited to, restrictions against persons that are related to a principal business counterparty of Mizuho Financial Group and its Three Core Companies, entities to which Mizuho Financial Group and its Three Core Companies are a principal business counterparty, entities that receive more than a specified amount of donations from Mizuho Financial Group or its Three Core Companies, entities to which directors have been transferred from us, our accounting auditor, law firms and consulting firms that receive more than a specified amount of fees from Mizuho Financial Group or its Three Core Companies, as well as persons who otherwise are likely to give rise to consistent substantive conflicts of interest in relation to general shareholders. Mizuho Financial Group may, however, appoint a person as an outside director who does not satisfy the additional independence requirements but who it believes to be suitable for the position with sufficient independence in consideration of such person’s character and insight, provided that it externally provides an explanation as to the reason it believes such person qualifies as an outside director with sufficient independence. |
ITEM 16H. | MINE SAFETY DISCLOSURE |
ITEM 17. | FINANCIAL STATEMENTS |
ITEM 18. | FINANCIAL STATEMENTS |
ITEM 19. | EXHIBITS |
| ||||
Exhibit Number | Description of Exhibits | |||
1.1 | Articles of Incorporation of Mizuho Financial Group, Inc., dated June | |||
| ||||
1.2 | Regulations of the Board of Directors of Mizuho Financial Group, Inc., as amended on April 1, | |||
| ||||
1.3 | Share Handling Regulations of Mizuho Financial Group, Inc., dated April 1, 2018 (English Translation) | |||
* | ||||
| ||||
2.1 | Form of American Depositary | |||
Receipt* | ||||
| ||||
2.2 | Form of Deposit Agreement, amended and restated as of April 2, 2018, among the registrant, The Bank of New York Mellon as Depositary and all owners and holders from time to time of American Depositary Receipts issued | |||
2.3 | Description of Our Shares of Common Stock and Preferred Stock—see “Item 10.B. Memorandum and Articles of Association.” | |||
2.4 | Description of Our American Depositary Shares | |||
8 | List of significant subsidiaries of Mizuho Financial Group, Inc.—see “Item 4.C. Information on the Company—Organizational Structure.” | |||
11 | Code of Ethics for Financial Professionals of Mizuho Financial Group, Inc. (English Translation)** | |||
| ||||
12.1 | CEO Certification required by Rule 13a-14(a) (17 CFR240.13a-14(a)). | |||
| ||||
12.2 | CFO Certification required by Rule 13a-14(a) (17 CFR240.13a-14(a)). | |||
| ||||
13.1 | Certification required by Rule 13a-14(b) (17 CFR240.13a-14(b)) and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350). | |||
15 | Consent of Independent Registered Public Accounting Firm | |||
101.INS | Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||
101.SCH | Inline XBRL Taxonomy Extension Schema | |||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |||
104 | The cover page for the Company’s Annual Report on From 20-F for the year ended March 31, 2020, has been formatted in Inline XBRL |
* | Incorporated by reference to our annual report on Form 20-F (No.001-33098) filed on July |
** | Incorporated by reference to our annual report on Form 20-F (No.001-33098) filed on July 21, 2016. |
2016 | 2017 | 2018 | ||||||||||||||||||||||||||||||||||
Average balance | Interest and dividend income | Average yield | Average balance | Interest and dividend income | Average yield | Average balance | Interest and dividend income | Average yield | ||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks: | ||||||||||||||||||||||||||||||||||||
Domestic | 29,485 | 30 | 0.10 | % | 37,389 | 27 | 0.07 | % | 39,812 | 27 | 0.07 | % | ||||||||||||||||||||||||
Foreign | 6,639 | 38 | 0.57 | % | 7,671 | 48 | 0.63 | % | 8,363 | 94 | 1.13 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 36,124 | 68 | 0.19 | % | 45,060 | 75 | 0.17 | % | 48,175 | 121 | 0.25 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions: | ||||||||||||||||||||||||||||||||||||
Domestic | 4,309 | 10 | 0.22 | % | 5,079 | 18 | 0.35 | % | 5,283 | 23 | 0.43 | % | ||||||||||||||||||||||||
Foreign | 10,465 | 50 | 0.48 | % | 9,213 | 79 | 0.85 | % | 9,251 | 132 | 1.43 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 14,774 | 60 | 0.41 | % | 14,292 | 97 | 0.68 | % | 14,534 | 155 | 1.07 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
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| |||||||||||||||||||||||||
Trading account assets: | ||||||||||||||||||||||||||||||||||||
Domestic | 5,262 | 16 | 0.31 | % | 4,408 | 27 | 0.62 | % | 4,654 | 50 | 1.07 | % | ||||||||||||||||||||||||
Foreign | 11,602 | 135 | 1.16 | % | 10,335 | 136 | 1.31 | % | 10,821 | 152 | 1.41 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 16,864 | 151 | 0.90 | % | 14,743 | 163 | 1.11 | % | 15,475 | 202 | 1.31 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
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| |||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||
Domestic | 25,625 | 88 | 0.34 | % | 20,357 | 78 | 0.38 | % | 21,267 | 97 | 0.46 | % | ||||||||||||||||||||||||
Foreign | 3,058 | 102 | 3.34 | % | 3,915 | 87 | 2.24 | % | 3,544 | 77 | 2.18 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 28,683 | 190 | 0.66 | % | 24,272 | 165 | 0.68 | % | 24,811 | 174 | 0.70 | % | ||||||||||||||||||||||||
|
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|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Loans (1): | ||||||||||||||||||||||||||||||||||||
Domestic | 52,866 | 565 | 1.07 | % | 53,930 | 510 | 0.95 | % | 58,049 | 511 | 0.88 | % | ||||||||||||||||||||||||
Foreign | 24,279 | 466 | 1.92 | % | 25,412 | 499 | 1.96 | % | 24,822 | 599 | 2.41 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 77,145 | 1,031 | 1.34 | % | 79,342 | 1,009 | 1.27 | % | 82,871 | 1,110 | 1.34 | % | ||||||||||||||||||||||||
|
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|
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|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-earning assets: | ||||||||||||||||||||||||||||||||||||
Domestic | 117,547 | 709 | 0.60 | % | 121,163 | 660 | 0.54 | % | 129,065 | 708 | 0.55 | % | ||||||||||||||||||||||||
Foreign | 56,043 | 791 | 1.41 | % | 56,546 | 849 | 1.50 | % | 56,801 | 1,054 | 1.86 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 173,590 | 1,500 | 0.86 | % | 177,709 | 1,509 | 0.85 | % | 185,866 | 1,762 | 0.95 | % | ||||||||||||||||||||||||
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| |||||||||||||||||||||||||
Noninterest-earning assets: | ||||||||||||||||||||||||||||||||||||
Cash and due from banks | 2,285 | 3,312 | 3,076 | |||||||||||||||||||||||||||||||||
Other noninterest-earning assets (2) | 21,443 | 23,320 | 19,896 | |||||||||||||||||||||||||||||||||
Allowance for loan losses | (478 | ) | (456 | ) | (380 | ) | ||||||||||||||||||||||||||||||
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|
|
|
| |||||||||||||||||||||||||||||||
Total noninterest-earning assets | 23,250 | 26,176 | 22,592 | |||||||||||||||||||||||||||||||||
|
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|
|
|
| |||||||||||||||||||||||||||||||
Total average assets | 196,840 | 203,885 | 208,458 | |||||||||||||||||||||||||||||||||
|
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|
2018 | 2019 | 2020 | ||||||||||||||||||||||||||||||||||
Average balance | Interest and dividend income | Average yield | Average balance | Interest and dividend income | Average yield | Average balance | Interest and dividend income | Average yield | ||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||
Interest-earning assets: | ||||||||||||||||||||||||||||||||||||
Interest-bearing deposits in other banks: | ||||||||||||||||||||||||||||||||||||
Domestic | 39,812 | 27 | 0.07 | % | 38,914 | 26 | 0.07 | % | 34,333 | 26 | 0.08 | % | ||||||||||||||||||||||||
Foreign | 8,363 | 94 | 1.13 | % | 5,951 | 95 | 1.59 | % | 5,716 | 79 | 1.39 | % | ||||||||||||||||||||||||
Total | 48,175 | 121 | 0.25 | % | 44,865 | 121 | 0.27 | % | 40,049 | 105 | 0.26 | % | ||||||||||||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions: | ||||||||||||||||||||||||||||||||||||
Domestic | 5,283 | 23 | 0.43 | % | 6,201 | 32 | 0.51 | % | 9,322 | 27 | 0.30 | % | ||||||||||||||||||||||||
Foreign | 9,251 | 132 | 1.43 | % | 9,924 | 228 | 2.30 | % | 11,301 | 249 | 2.21 | % | ||||||||||||||||||||||||
Total | 14,534 | 155 | 1.07 | % | 16,125 | 260 | 1.62 | % | 20,623 | 276 | 1.34 | % | ||||||||||||||||||||||||
Trading account assets: | ||||||||||||||||||||||||||||||||||||
Domestic | 4,654 | 50 | 1.07 | % | 5,930 | 71 | 1.19 | % | 7,753 | 72 | 0.93 | % | ||||||||||||||||||||||||
Foreign | 10,821 | 152 | 1.41 | % | 9,197 | 141 | 1.53 | % | 8,859 | 150 | 1.69 | % | ||||||||||||||||||||||||
Total | 15,475 | 202 | 1.31 | % | 15,127 | 212 | 1.40 | % | 16,612 | 222 | 1.34 | % | ||||||||||||||||||||||||
Investments: | ||||||||||||||||||||||||||||||||||||
Domestic | 21,267 | 97 | 0.46 | % | 20,109 | 137 | 0.68 | % | 16,532 | 85 | 0.51 | % | ||||||||||||||||||||||||
Foreign | 3,544 | 77 | 2.18 | % | 4,471 | 95 | 2.13 | % | 4,096 | 81 | 1.98 | % | ||||||||||||||||||||||||
Total | 24,811 | 174 | 0.70 | % | 24,580 | 232 | 0.95 | % | 20,628 | 166 | 0.80 | % | ||||||||||||||||||||||||
Loans (1) : | ||||||||||||||||||||||||||||||||||||
Domestic | 58,049 | 511 | 0.88 | % | 55,897 | 531 | 0.95 | % | 54,777 | 535 | 0.98 | % | ||||||||||||||||||||||||
Foreign | 24,822 | 599 | 2.41 | % | 28,037 | 851 | 3.03 | % | 28,827 | 846 | 2.94 | % | ||||||||||||||||||||||||
Total | 82,871 | 1,110 | 1.34 | % | 83,934 | 1,382 | 1.65 | % | 83,604 | 1,381 | 1.65 | % | ||||||||||||||||||||||||
Total interest-earning assets: | ||||||||||||||||||||||||||||||||||||
Domestic | 129,065 | 708 | 0.55 | % | 127,051 | 797 | 0.63 | % | 122,717 | 745 | 0.61 | % | ||||||||||||||||||||||||
Foreign | 56,801 | 1,054 | 1.86 | % | 57,580 | 1,410 | 2.45 | % | 58,799 | 1,405 | 2.39 | % | ||||||||||||||||||||||||
Total | 185,866 | 1,762 | 0.95 | % | 184,631 | 2,207 | 1.20 | % | 181,516 | 2,150 | 1.19 | % | ||||||||||||||||||||||||
Noninterest-earning assets: | ||||||||||||||||||||||||||||||||||||
Cash and due from banks | 3,076 | 3,832 | 3,465 | |||||||||||||||||||||||||||||||||
Other noninterest-earning assets (2) | 19,896 | 17,646 | 18,146 | |||||||||||||||||||||||||||||||||
Allowance for loan losses | (380 | ) | (297 | ) | (346 | ) | ||||||||||||||||||||||||||||||
Tota noninterest-earning assets | 22,592 | 21,181 | 21,265 | |||||||||||||||||||||||||||||||||
Total average assets | 208,458 | 205,812 | 202,781 | |||||||||||||||||||||||||||||||||
(1) | Average balances of loans include all nonaccrual loans. The amortized portion of net loan origination fees (costs) is included in interest income on loans. |
(2) | The fair value carrying amounts of derivative contracts are reported in Other noninterest-earning assets. |
2016 | 2017 | 2018 | ||||||||||||||||||||||||||||||||||
Average balance | Interest expense | Average rate | Average balance | Interest expense | Average rate | Average balance | Interest expense | Average rate | ||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||
Liabilities and equity: | ||||||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||||||||||||
Domestic | 81,090 | 60 | 0.07 | % | 83,293 | 51 | 0.06 | % | 90,078 | 60 | 0.07 | % | ||||||||||||||||||||||||
Foreign | 20,958 | 154 | 0.73 | % | 23,173 | 214 | 0.92 | % | 24,567 | 323 | 1.32 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 102,048 | 214 | 0.21 | % | 106,466 | 265 | 0.25 | % | 114,645 | 383 | 0.33 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Short-term borrowings (1): | ||||||||||||||||||||||||||||||||||||
Domestic | 15,139 | 22 | 0.15 | % | 14,177 | 27 | 0.19 | % | 13,678 | 43 | 0.31 | % | ||||||||||||||||||||||||
Foreign | 18,982 | 58 | 0.31 | % | 17,112 | 109 | 0.63 | % | 16,385 | 222 | 1.35 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 34,121 | 80 | 0.24 | % | 31,289 | 136 | 0.43 | % | 30,063 | 265 | 0.88 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Trading account liabilities: | ||||||||||||||||||||||||||||||||||||
Domestic | 2,092 | 13 | 0.61 | % | 1,697 | 14 | 0.82 | % | 1,454 | 27 | 1.87 | % | ||||||||||||||||||||||||
Foreign | 1,195 | 8 | 0.69 | % | 1,049 | 7 | 0.71 | % | 1,235 | 14 | 1.16 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 3,287 | 21 | 0.64 | % | 2,746 | 21 | 0.78 | % | 2,689 | 41 | 1.54 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Long-term debt: | ||||||||||||||||||||||||||||||||||||
Domestic | 14,236 | 176 | 1.23 | % | 14,523 | 178 | 1.22 | % | 13,032 | 197 | 1.51 | % | ||||||||||||||||||||||||
Foreign | 1,441 | 4 | 0.26 | % | 655 | 2 | 0.32 | % | 732 | 4 | 0.49 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 15,677 | 180 | 1.15 | % | 15,178 | 180 | 1.18 | % | 13,764 | 201 | 1.46 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total interest-bearing | ||||||||||||||||||||||||||||||||||||
Domestic | 112,557 | 271 | 0.24 | % | 113,690 | 270 | 0.24 | % | 118,242 | 327 | 0.28 | % | ||||||||||||||||||||||||
Foreign | 42,576 | 224 | 0.53 | % | 41,989 | 332 | 0.79 | % | 42,919 | 563 | 1.31 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Total | 155,133 | 495 | 0.32 | % | 155,679 | 602 | 0.39 | % | 161,161 | 890 | 0.55 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||
Noninterest-bearing liabilities (2) | 35,176 | 40,992 | 39,758 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Equity | 6,531 | 7,214 | 7,539 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Total average liabilities and equity | 196,840 | 203,885 | 208,458 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Net interest income and average interest rate spread | 1,005 | 0.54 | % | 907 | 0.46 | % | 872 | 0.40 | % | |||||||||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Net interest income as a percentage of average total interest-earning assets | 0.58 | % | 0.51 | % | 0.47 | % |
2020.
2018 | 2019 | 2020 | ||||||||||||||||||||||||||||||||||
Average balance | Interest expense | Average rate | Average balance | Interest expense | Average rate | Average balance | Interest expense | Average rate | ||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||
Liabilities and equity: | ||||||||||||||||||||||||||||||||||||
Interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||||||||||||||
Domestic | 90,078 | 60 | 0.07 | % | 87,168 | 94 | 0.11 | % | 87,143 | 90 | 0.10 | % | ||||||||||||||||||||||||
Foreign | 24,567 | 323 | 1.32 | % | 26,693 | 519 | 1.95 | % | 27,507 | 526 | 1.91 | % | ||||||||||||||||||||||||
Total | 114,645 | 383 | 0.33 | % | 113,861 | 613 | 0.54 | % | 114,650 | 616 | 0.54 | % | ||||||||||||||||||||||||
Short-term borrowings (1) : | ||||||||||||||||||||||||||||||||||||
Domestic | 13,678 | 43 | 0.31 | % | 14,011 | 69 | 0.49 | % | 10,918 | 63 | 0.58 | % | ||||||||||||||||||||||||
Foreign | 16,385 | 222 | 1.35 | % | 15,094 | 357 | 2.37 | % | 15,112 | 334 | 2.21 | % | ||||||||||||||||||||||||
Total | 30,063 | 265 | 0.88 | % | 29,105 | 426 | 1.47 | % | 26,030 | 397 | 1.53 | % | ||||||||||||||||||||||||
Trading account liabilities: | ||||||||||||||||||||||||||||||||||||
Domestic | 1,454 | 27 | 1.87 | % | 1,735 | 34 | 1.93 | % | 1,591 | 41 | 2.59 | % | ||||||||||||||||||||||||
Foreign | 1,235 | 14 | 1.16 | % | 1,249 | 16 | 1.29 | % | 1,009 | 12 | 1.16 | % | ||||||||||||||||||||||||
Total | 2,689 | 41 | 1.54 | % | 2,984 | 50 | 1.66 | % | 2,600 | 53 | 2.04 | % | ||||||||||||||||||||||||
Long-term debt: | ||||||||||||||||||||||||||||||||||||
Domestic | 13,032 | 197 | 1.51 | % | 12,285 | 217 | 1.77 | % | 9,631 | 198 | 2.05 | % | ||||||||||||||||||||||||
Foreign | 732 | 4 | 0.49 | % | 701 | 7 | 0.95 | % | 678 | 7 | 1.13 | % | ||||||||||||||||||||||||
Total | 13,764 | 201 | 1.46 | % | 12,986 | 224 | 1.72 | % | 10,309 | 205 | 1.99 | % | ||||||||||||||||||||||||
Total interest-bearing liabilities: | ||||||||||||||||||||||||||||||||||||
Domestic | 118,242 | 327 | 0.28 | % | 115,199 | 414 | 0.36 | % | 109,283 | 392 | 0.36 | % | ||||||||||||||||||||||||
Foreign | 42,919 | 563 | 1.31 | % | 43,737 | 899 | 2.06 | % | 44,306 | 879 | 1.98 | % | ||||||||||||||||||||||||
Total | 161,161 | 890 | 0.55 | % | 158,936 | 1,313 | 0.83 | % | 153,589 | 1,271 | 0.83 | % | ||||||||||||||||||||||||
Noninterest-bearing liabilities (2) | 39,758 | 38,548 | 40,803 | |||||||||||||||||||||||||||||||||
Equity | 7,539 | 8,328 | 8,389 | |||||||||||||||||||||||||||||||||
Total average liabilities and equity | 208,458 | 205,812 | 202,781 | |||||||||||||||||||||||||||||||||
Net interest income and average interest rate spread | 872 | 0.40 | % | 894 | 0.37 | % | 879 | 0.36 | % | |||||||||||||||||||||||||||
Net interest income as a percentage of average total interest-earning assets | 0.47 | % | 0.48 | % | 0.48 | % |
(1) | Short-term borrowings consist of Due to trust accounts, Call money and funds purchased, Payables under repurchase agreements and securities lending transactions, and Other short-term borrowings. |
(2) | The fair value carrying amounts of derivative contracts are reported in Noninterest-bearing liabilities. |
Fiscal year ended March 31, 2017 versus fiscal year ended March 31, 2016 | Fiscal year ended March 31, 2018 versus fiscal year ended March 31, 2017 | |||||||||||||||||||||||
Increase (decrease) due to changes in | Net change | Increase (decrease) due to changes in | Net change | |||||||||||||||||||||
Volume | Yield | Volume | Yield | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Interest and dividend income: | ||||||||||||||||||||||||
Interest-bearing deposits in other banks: | ||||||||||||||||||||||||
Domestic | 6 | (9 | ) | (3 | ) | 1 | (1 | ) | — | |||||||||||||||
Foreign | 6 | 4 | 10 | 5 | 41 | 46 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 12 | (5 | ) | 7 | 6 | 40 | 46 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions: | ||||||||||||||||||||||||
Domestic | 2 | 6 | 8 | 1 | 4 | 5 | ||||||||||||||||||
Foreign | (6 | ) | 35 | 29 | — | 53 | 53 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | (4 | ) | 41 | 37 | 1 | 57 | 58 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Trading account assets: | ||||||||||||||||||||||||
Domestic | (3 | ) | 14 | 11 | 2 | 21 | 23 | |||||||||||||||||
Foreign | (14 | ) | 15 | 1 | 6 | 10 | 16 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | (17 | ) | 29 | 12 | 8 | 31 | 39 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Investments: | ||||||||||||||||||||||||
Domestic | (18 | ) | 8 | (10 | ) | 4 | 15 | 19 | ||||||||||||||||
Foreign | 19 | (34 | ) | (15 | ) | (8 | ) | (2 | ) | (10 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 1 | (26 | ) | (25 | ) | (4 | ) | 13 | 9 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Loans: | ||||||||||||||||||||||||
Domestic | 10 | (65 | ) | (55 | ) | 36 | (35 | ) | 1 | |||||||||||||||
Foreign | 22 | 11 | 33 | (11 | ) | 111 | 100 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 32 | (54 | ) | (22 | ) | 25 | 76 | 101 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total interest and dividend income: | ||||||||||||||||||||||||
Domestic | (3 | ) | (46 | ) | (49 | ) | 44 | 4 | 48 | |||||||||||||||
Foreign | 27 | 31 | 58 | (8 | ) | 213 | 205 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 24 | (15 | ) | 9 | 36 | 217 | 253 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal year ended March 31, 2019 versus fiscal year ended March 31, 2018 | Fiscal year ended March 31, 2020 versus fiscal year ended March 31, 2019 | |||||||||||||||||||||||
Increase (decrease) due to changes in | Net change | Increase (decrease) due to changes in | Net change | |||||||||||||||||||||
Volume | Yield | Volume | Yield | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Interest and dividend income: | ||||||||||||||||||||||||
Interest-bearing deposits in other banks: | ||||||||||||||||||||||||
Domestic | (1 | ) | — | (1 | ) | (3 | ) | 3 | — | |||||||||||||||
Foreign | (27 | ) | 28 | 1 | (4 | ) | (12 | ) | (16 | ) | ||||||||||||||
Total | (28 | ) | 28 | — | (7 | ) | (9 | ) | (16 | ) | ||||||||||||||
Call loans and funds sold, and receivables under resale agreements and securities borrowing transactions: | ||||||||||||||||||||||||
Domestic | 4 | 5 | 9 | 9 | (14 | ) | (5 | ) | ||||||||||||||||
Foreign | 10 | 86 | 96 | 30 | (9 | ) | 21 | |||||||||||||||||
Total | 14 | 91 | 105 | 39 | (23 | ) | 16 | |||||||||||||||||
Trading account assets: | ||||||||||||||||||||||||
Domestic | 15 | 6 | 21 | 17 | (16 | ) | 1 | |||||||||||||||||
Foreign | (23 | ) | 12 | (11 | ) | (5 | ) | 14 | 9 | |||||||||||||||
Total | (8 | ) | 18 | 10 | 12 | (2 | ) | 10 | ||||||||||||||||
Investments: | ||||||||||||||||||||||||
Domestic | (5 | ) | 45 | 40 | (22 | ) | (30 | ) | (52 | ) | ||||||||||||||
Foreign | 20 | (2 | ) | 18 | (8 | ) | (6 | ) | (14 | ) | ||||||||||||||
Total | 15 | 43 | 58 | (30 | ) | (36 | ) | (66 | ) | |||||||||||||||
Loans: | ||||||||||||||||||||||||
Domestic | (19 | ) | 39 | 20 | (10 | ) | 14 | 4 | ||||||||||||||||
Foreign | 84 | 168 | 252 | 23 | (28 | ) | (5 | ) | ||||||||||||||||
Total | 65 | 207 | 272 | 13 | (14 | ) | (1 | ) | ||||||||||||||||
Total interest and dividend income: | ||||||||||||||||||||||||
Domestic | (6 | ) | 95 | 89 | (9 | ) | (43 | ) | (52 | ) | ||||||||||||||
Foreign | 64 | 292 | 356 | 36 | (41 | ) | (5 | ) | ||||||||||||||||
Total | 58 | 387 | 445 | 27 | (84 | ) | (57 | ) | ||||||||||||||||
Fiscal year ended March 31, 2017 versus fiscal year ended March 31, 2016 | Fiscal year ended March 31, 2018 versus fiscal year ended March 31, 2017 | |||||||||||||||||||||||
Increase (decrease) due to changes in | Net change | Increase (decrease) due to changes in | Net change | |||||||||||||||||||||
Volume | Rate | Volume | Rate | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||
Domestic | 1 | (10 | ) | (9 | ) | 4 | 5 | 9 | ||||||||||||||||
Foreign | 18 | 42 | 60 | 14 | 95 | 109 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 19 | 32 | 51 | 18 | 100 | 118 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Short-term borrowings: | ||||||||||||||||||||||||
Domestic | (1 | ) | 6 | 5 | (1 | ) | 17 | 16 | ||||||||||||||||
Foreign | (6 | ) | 57 | 51 | (5 | ) | 118 | 113 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | (7 | ) | 63 | 56 | (6 | ) | 135 | 129 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Trading account liabilities: | ||||||||||||||||||||||||
Domestic | (2 | ) | 3 | 1 | (2 | ) | 15 | 13 | ||||||||||||||||
Foreign | (1 | ) | — | (1 | ) | 1 | 6 | 7 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | (3 | ) | 3 | — | (1 | ) | 21 | 20 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Long-term debt: | ||||||||||||||||||||||||
Domestic | 4 | (2 | ) | 2 | (18 | ) | 37 | 19 | ||||||||||||||||
Foreign | (2 | ) | — | (2 | ) | — | 2 | 2 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 2 | (2 | ) | — | (18 | ) | 39 | 21 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total interest expense: | ||||||||||||||||||||||||
Domestic | 2 | (3 | ) | (1 | ) | (17 | ) | 74 | 57 | |||||||||||||||
Foreign | 9 | 99 | 108 | 10 | 221 | 231 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 11 | 96 | 107 | (7 | ) | 295 | 288 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net interest income: | ||||||||||||||||||||||||
Domestic | (5 | ) | (43 | ) | (48 | ) | 61 | (70 | ) | (9 | ) | |||||||||||||
Foreign | 18 | (68 | ) | (50 | ) | (18 | ) | (8 | ) | (26 | ) | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 13 | (111 | ) | (98 | ) | 43 | (78 | ) | (35 | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Fiscal year ended March 31, 2019 versus fiscal year ended March 31, 2018 | Fiscal year ended March 31, 2020 versus fiscal year ended March 31, 2019 | |||||||||||||||||||||||
Increase (decrease) due to changes in | Net change | Increase (decrease) due to changes in | Net change | |||||||||||||||||||||
Volume | Rate | Volume | Rate | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Interest expense: | ||||||||||||||||||||||||
Deposits: | ||||||||||||||||||||||||
Domestic | (2 | ) | 36 | 34 | — | (4 | ) | (4 | ) | |||||||||||||||
Foreign | 30 | 166 | 196 | 16 | (9 | ) | 7 | |||||||||||||||||
Total | 28 | 202 | 230 | 16 | (13 | ) | 3 | |||||||||||||||||
Short-term borrowings: | ||||||||||||||||||||||||
Domestic | 1 | 25 | 26 | (15 | ) | 9 | (6 | ) | ||||||||||||||||
Foreign | (18 | ) | 153 | 135 | — | (23 | ) | (23 | ) | |||||||||||||||
Total | (17 | ) | 178 | 161 | (15 | ) | (14 | ) | (29 | ) | ||||||||||||||
Trading account liabilities: | ||||||||||||||||||||||||
Domestic | 6 | 1 | 7 | (3 | ) | 10 | 7 | |||||||||||||||||
Foreign | — | 2 | 2 | (3 | ) | (1 | ) | (4 | ) | |||||||||||||||
Total | 6 | 3 | 9 | (6 | ) | 9 | 3 | |||||||||||||||||
Long-term debt: | ||||||||||||||||||||||||
Domestic | (11 | ) | 31 | 20 | (47 | ) | 28 | (19 | ) | |||||||||||||||
Foreign | — | 3 | 3 | — | — | — | ||||||||||||||||||
Total | (11 | ) | 34 | 23 | (47 | ) | 28 | (19 | ) | |||||||||||||||
Total interest expense: | ||||||||||||||||||||||||
Domestic | (6 | ) | 93 | 87 | (65 | ) | 43 | (22 | ) | |||||||||||||||
Foreign | 12 | 324 | 336 | 13 | (33 | ) | (20 | ) | ||||||||||||||||
Total | 6 | 417 | 423 | (52 | ) | 10 | (42 | ) | ||||||||||||||||
Net interest income: | ||||||||||||||||||||||||
Domestic | — | 2 | 2 | 56 | (86 | ) | (30 | ) | ||||||||||||||||
Foreign | 52 | (32 | ) | 20 | 23 | (8 | ) | 15 | ||||||||||||||||
Total | 52 | (30 | ) | 22 | 79 | (94 | ) | (15 | ) | |||||||||||||||
2016 | 2017 | 2018 | ||||||||||||||||||||||||||||||||||
Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | 15,672 | 15,763 | 91 | 10,257 | 10,263 | 6 | 13,334 | 13,332 | (2 | ) | ||||||||||||||||||||||||||
Agency mortgage-backed securities (1) | 751 | 780 | 29 | 694 | 709 | 15 | 730 | 743 | 13 | |||||||||||||||||||||||||||
Corporate bonds and other debt securities | 2,696 | 2,721 | 25 | 2,597 | 2,654 | 57 | 2,743 | 2,789 | 46 | |||||||||||||||||||||||||||
Equity securities (marketable) | 1,610 | 3,726 | 2,116 | 1,452 | 3,722 | 2,270 | 1,478 | 3,915 | 2,437 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Total domestic | 20,729 | 22,990 | 2,261 | 15,000 | 17,348 | 2,348 | 18,285 | 20,779 | 2,494 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 436 | 438 | 2 | 1,148 | 1,144 | (4 | ) | 689 | 686 | (3 | ) | |||||||||||||||||||||||||
Other foreign government bonds | 940 | 942 | 2 | 934 | 935 | 1 | 1,058 | 1,058 | — | |||||||||||||||||||||||||||
Agency mortgage-backed securities (2) | 169 | 169 | — | 139 | 134 | (5 | ) | 153 | 146 | (7 | ) | |||||||||||||||||||||||||
Corporate bonds and other debt securities | 852 | 859 | 7 | 915 | 917 | 2 | 880 | 879 | (1 | ) | ||||||||||||||||||||||||||
Equity securities (marketable) | 54 | 55 | 1 | 78 | 79 | 1 | 117 | 118 | 1 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Total foreign | 2,451 | 2,463 | 12 | 3,214 | 3,209 | (5 | ) | 2,897 | 2,887 | (10 | ) | |||||||||||||||||||||||||
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| |||||||||||||||||||
Total | 23,180 | 25,453 | 2,273 | 18,214 | 20,557 | 2,343 | 21,182 | 23,666 | 2,484 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | 3,760 | 3,817 | 57 | 3,060 | 3,097 | 37 | 1,960 | 1,984 | 24 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Total domestic | 3,760 | 3,817 | 57 | 3,060 | 3,097 | 37 | 1,960 | 1,984 | 24 | |||||||||||||||||||||||||||
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| |||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||
Agency mortgage-backed securities (3) | 1,059 | 1,056 | (3 | ) | 757 | 750 | (7 | ) | 558 | 538 | (20 | ) | ||||||||||||||||||||||||
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| |||||||||||||||||||
Total foreign | 1,059 | 1,056 | (3 | ) | 757 | 750 | (7 | ) | 558 | 538 | (20 | ) | ||||||||||||||||||||||||
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| |||||||||||||||||||
Total | 4,819 | 4,873 | 54 | 3,817 | 3,847 | 30 | 2,518 | 2,522 | 4 | |||||||||||||||||||||||||||
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2020:
2018 | 2019 | 2020 | ||||||||||||||||||||||||||||||||||
Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | Amortized cost | Fair value | Net unrealized gains (losses) | ||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | 13,334 | 13,332 | (2 | ) | 11,889 | 11,897 | 8 | 12,652 | 12,603 | (49 | ) | |||||||||||||||||||||||||
Agency mortgage-backed securities (1) | 730 | 743 | 13 | 503 | 517 | 14 | 495 | 505 | 10 | |||||||||||||||||||||||||||
Corporate bonds and other debt securities | 2,743 | 2,789 | 46 | 2,546 | 2,560 | 14 | 2,801 | 2,807 | 6 | |||||||||||||||||||||||||||
Equity securities (marketable) (2) | 1,478 | 3,915 | 2,437 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Total domestic | 18,285 | 20,779 | 2,494 | 14,938 | 14,974 | 36 | 15,948 | 15,915 | (33 | ) | ||||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 689 | 686 | (3 | ) | 1,009 | 1,009 | — | 927 | 935 | 8 | ||||||||||||||||||||||||||
Other foreign government bonds | 1,058 | 1,058 | — | 1,342 | 1,342 | — | 1,408 | 1,411 | 3 | |||||||||||||||||||||||||||
Agency mortgage-backed securities (3) | 153 | 146 | (7 | ) | 27 | 27 | — | — | — | — | ||||||||||||||||||||||||||
Corporate bonds and other debt securities | 880 | 879 | (1 | ) | 778 | 781 | 3 | 850 | 852 | 2 | ||||||||||||||||||||||||||
Equity securities (marketable) (2) | 117 | 118 | 1 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Total foreign | 2,897 | 2,887 | (10 | ) | 3,156 | 3,159 | 3 | 3,185 | 3,198 | 13 | ||||||||||||||||||||||||||
Total | 21,182 | 23,666 | 2,484 | 18,094 | 18,133 | 39 | 19,133 | 19,113 | (20 | ) | ||||||||||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||
Japanese government bonds | 1,960 | 1,984 | 24 | 1,120 | 1,140 | 20 | 480 | 493 | 13 | |||||||||||||||||||||||||||
Total domestic | 1,960 | 1,984 | 24 | 1,120 | 1,140 | 20 | 480 | 493 | 13 | |||||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||
Agency mortgage-backed securities (4) | 558 | 538 | (20 | ) | 484 | 470 | (14 | ) | 382 | 382 | — | |||||||||||||||||||||||||
Total foreign | 558 | 538 | (20 | ) | 484 | 470 | (14 | ) | 382 | 382 | — | |||||||||||||||||||||||||
Total | 2,518 | 2,522 | 4 | 1,604 | 1,610 | 6 | 862 | 875 | 13 | |||||||||||||||||||||||||||
(1) | All domestic agency mortgage-backed securities are issued by Japan Housing Finance Agency, a Japanese government-sponsored enterprise. |
(2) | The MHFG Group adopted ASU No.2016-01 on April 1, 2018, resulting in a cumulative-effect adjustment from AOCI to Retained earnings for net unrealized gains on equity securities (marketable). Theavailable-for-sale category was eliminated for equity securities effective April 1, 2018. See Note 2 “Issued accounting pronouncements” for further details. |
(3) | Foreign agency mortgage-backed securities primarily consist of Government National Mortgage Association (“Ginnie Mae”) securities, which are guaranteed by the United States government. |
All foreign agency mortgage-backed securities presented in this line are Ginnie Mae securities. |
Maturity | ||||||||||||||||||||||||||||||||||||||||
One year or less | After one year through five years | After five years through ten years | After ten years | Total | ||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | |||||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Japanese government bonds | 6,286 | (0.22 | )% | 5,026 | (0.11 | )% | 1,921 | (0.02 | )% | 99 | 0.52 | % | 13,332 | (0.15 | )% | |||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | 743 | 0.93 | % | 743 | 0.93 | % | ||||||||||||||||||||||||||||
Corporate bonds and other debt securities | 345 | 0.21 | % | 1,359 | 2.82 | % | 722 | 0.39 | % | 363 | 0.52 | % | 2,789 | 1.56 | % | |||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total domestic | 6,631 | (0.20 | )% | 6,385 | 0.50 | % | 2,643 | 0.10 | % | 1,205 | 0.77 | % | 16,864 | 0.18 | % | |||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 611 | 1.61 | % | — | — | 75 | 2.16 | % | — | — | 686 | 1.67 | % | |||||||||||||||||||||||||||
Other foreign government bonds | 842 | 1.83 | % | 208 | 2.14 | % | 8 | 0.35 | % | — | — | 1,058 | 1.88 | % | ||||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | 146 | 2.89 | % | 146 | 2.89 | % | ||||||||||||||||||||||||||||
Corporate bonds and other debt securities | 503 | 1.29 | % | 312 | 1.33 | % | 61 | 1.22 | % | 3 | 0.15 | % | 879 | 1.29 | % | |||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total foreign | 1,956 | 1.62 | % | 520 | 1.66 | % | 144 | 1.67 | % | 149 | 2.84 | % | 2,769 | 1.70 | % | |||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total | 8,587 | 0.21 | % | 6,905 | 0.59 | % | 2,787 | 0.18 | % | 1,354 | 1.01 | % | 19,633 | 0.39 | % | |||||||||||||||||||||||||
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Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Japanese government bonds | 840 | 0.22 | % | 740 | 0.21 | % | 380 | 0.69 | % | — | — | 1,960 | 0.31 | % | ||||||||||||||||||||||||||
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Total domestic | 840 | 0.22 | % | 740 | 0.21 | % | 380 | 0.69 | % | — | — | 1,960 | 0.31 | % | ||||||||||||||||||||||||||
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Foreign: | ||||||||||||||||||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | 558 | 3.72 | % | 558 | 3.72 | % | ||||||||||||||||||||||||||||
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Total foreign | — | — | — | — | — | — | 558 | 3.72 | % | 558 | 3.72 | % | ||||||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total | 840 | 0.22 | % | 740 | 0.21 | % | 380 | 0.69 | % | 558 | 3.72 | % | 2,518 | 1.06 | % | |||||||||||||||||||||||||
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Maturity | ||||||||||||||||||||||||||||||||||||||||
One year or less | After one year through five years | After five years through ten years | After ten years | Total | ||||||||||||||||||||||||||||||||||||
Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | Amount | Yield | |||||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Japanese government bonds | 5,873 | (0.18 | )% | 4,963 | (0.30 | )% | 1,722 | (0.27 | )% | 45 | 0.21 | % | 12,603 | (0.24 | )% | |||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | 505 | 0.99 | % | 505 | 0.99 | % | ||||||||||||||||||||||||||||
Corporate bonds and other debt securities | 127 | 0.34 | % | 1,244 | 0.25 | % | 1,023 | 0.33 | % | 413 | 1.27 | % | 2,807 | 0.43 | % | |||||||||||||||||||||||||
Total domestic | 6,000 | (0.17 | )% | 6,207 | (0.19 | )% | 2,745 | (0.05 | )% | 963 | 1.07 | % | 15,915 | (0.08 | )% | |||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 890 | 1.95 | % | 45 | 1.71 | % | — | — | — | — | 935 | 1.93 | % | |||||||||||||||||||||||||||
Other foreign government bonds | 1,031 | 2.27 | % | 380 | 1.68 | % | — | — | — | — | 1,411 | 2.11 | % | |||||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | — | 6.00 | % | — | 6.00 | % | ||||||||||||||||||||||||||||
Corporate bonds and other debt securities | 378 | 1.67 | % | 329 | 2.25 | % | 142 | 2.06 | % | 3 | 0.09 | % | 852 | 1.95 | % | |||||||||||||||||||||||||
Total foreign | 2,299 | 2.05 | % | 754 | 1.93 | % | 142 | 2.06 | % | 3 | 0.22 | % | 3,198 | 2.02 | % | |||||||||||||||||||||||||
Total | 8,299 | 0.44 | % | 6,961 | 0.03 | % | 2,887 | 0.05 | % | 966 | 1.07 | % | 19,113 | 0.27 | % | |||||||||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Japanese government bonds | — | — | 480 | 0.67 | % | — | — | — | — | 480 | 0.67 | % | ||||||||||||||||||||||||||||
Total domestic | — | — | 480 | 0.67 | % | — | — | — | — | 480 | 0.67 | % | ||||||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||||||||||
Agency mortgage-backed securities | — | — | — | — | — | — | 382 | 3.72 | % | 382 | 3.72 | % | ||||||||||||||||||||||||||||
Total foreign | — | — | — | — | — | — | 382 | 3.72 | % | 382 | 3.72 | % | ||||||||||||||||||||||||||||
Total | — | — | 480 | 0.67 | % | — | — | 382 | 3.72 | % | 862 | 2.02 | % | |||||||||||||||||||||||||||
2020.
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Domestic (2): | ||||||||||||||||||||
Manufacturing | 8,026 | 8,224 | 8,345 | 8,740 | 8,156 | |||||||||||||||
Construction and real estate | 7,238 | 7,416 | 7,822 | 7,772 | 8,102 | |||||||||||||||
Services | 3,953 | 4,267 | 4,648 | 4,749 | 5,024 | |||||||||||||||
Wholesale and retail | 5,350 | 5,586 | 5,407 | 5,140 | 5,113 | |||||||||||||||
Transportation and communications | 3,247 | 3,157 | 3,268 | 3,491 | 3,565 | |||||||||||||||
Banks and other financial institutions | 3,460 | 3,853 | 3,632 | 4,006 | 4,471 | |||||||||||||||
Government and public institutions | 6,734 | 4,612 | 3,395 | 8,532 | 8,882 | |||||||||||||||
Other industries(1) | 4,983 | 5,079 | 4,618 | 4,427 | 5,018 | |||||||||||||||
Individuals: | ||||||||||||||||||||
Mortgage loans | 11,184 | 11,018 | 10,585 | 9,960 | 9,445 | |||||||||||||||
Other | 763 | 798 | 852 | 840 | 884 | |||||||||||||||
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| |||||||||||
Total domestic | 54,938 | 54,010 | 52,572 | 57,657 | 58,660 | |||||||||||||||
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| |||||||||||
Foreign: | ||||||||||||||||||||
Commercial and industrial | 12,938 | 16,688 | 17,320 | 16,872 | 17,095 | |||||||||||||||
Banks and other financial institutions | 4,610 | 6,077 | 6,382 | 6,760 | 6,740 | |||||||||||||||
Government and public institutions | 883 | 1,011 | 1,175 | 960 | �� | 1,128 | ||||||||||||||
Other | 255 | 426 | 274 | 191 | 38 | |||||||||||||||
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| |||||||||||
Total foreign | 18,686 | 24,202 | 25,151 | 24,783 | 25,001 | |||||||||||||||
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| |||||||||||
Total | 73,624 | 78,212 | 77,723 | 82,440 | 83,661 | |||||||||||||||
Less: Unearned income and deferred loan fees—net | 139 | 164 | 168 | 156 | 146 | |||||||||||||||
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Total loans before allowance for loan losses | 73,485 | 78,048 | 77,555 | 82,284 | 83,515 | |||||||||||||||
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2020:
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 8,334 | 8,730 | 8,150 | 9,554 | 9,731 | |||||||||||||||
Construction and real estate | 7,802 | 7,751 | 8,095 | 8,950 | 9,603 | |||||||||||||||
Services | 4,524 | 4,633 | 4,924 | 5,017 | 5,993 | |||||||||||||||
Wholesale and retail | 5,399 | 5,131 | 5,108 | 5,159 | 5,220 | |||||||||||||||
Transportation and communications | 3,349 | 3,567 | 3,632 | 3,693 | 3,833 | |||||||||||||||
Banks and other financial institutions | 3,713 | 4,087 | 4,527 | 4,346 | 4,635 | |||||||||||||||
Government and public institutions | 3,396 | 8,532 | 8,882 | 2,359 | 2,199 | |||||||||||||||
Other industries (1) | 4,618 | 4,426 | 5,013 | 5,473 | 5,389 | |||||||||||||||
Individuals: | ||||||||||||||||||||
Mortgage loans | 10,585 | 9,960 | 9,445 | 8,950 | 8,567 | |||||||||||||||
Other | 852 | 840 | 884 | 908 | 861 | |||||||||||||||
Total domestic | 52,572 | 57,657 | 58,660 | 54,409 | 56,031 | |||||||||||||||
Foreign: | ||||||||||||||||||||
Commercial and industrial | 17,453 | 16,972 | 17,225 | 19,126 | 20,819 | |||||||||||||||
Banks and other financial institutions | 7,120 | 7,403 | 7,435 | 9,087 | 10,475 | |||||||||||||||
Government and public institutions | 304 | 217 | 303 | 297 | 317 | |||||||||||||||
Other | 274 | 191 | 38 | 33 | 35 | |||||||||||||||
Total foreign | 25,151 | 24,783 | 25,001 | 28,543 | 31,646 | |||||||||||||||
Total | 77,723 | 82,440 | 83,661 | 82,952 | 87,677 | |||||||||||||||
Less: Unearned income and deferred loan fees—net | 168 | 156 | 146 | 152 | 149 | |||||||||||||||
Total loans before allowance for loan losses | 77,555 | 82,284 | 83,515 | 82,800 | 87,528 | |||||||||||||||
(1) | Other industries of |
(2) | Certain loans of domestic and foreign were reclassified |
Maturity | ||||||||||||||||
One year or less | After one year through five years | After five years | Total | |||||||||||||
(in billions of yen) | ||||||||||||||||
Domestic: | ||||||||||||||||
Manufacturing | 3,837 | 3,177 | 1,142 | 8,156 | ||||||||||||
Construction and real estate | 1,604 | 3,239 | 3,259 | 8,102 | ||||||||||||
Services | 2,116 | 2,173 | 735 | 5,024 | ||||||||||||
Wholesale and retail | 2,964 | 1,664 | 485 | 5,113 | ||||||||||||
Transportation and communications | 1,018 | 1,623 | 924 | 3,565 | ||||||||||||
Banks and other financial institutions | 1,844 | 1,884 | 743 | 4,471 | ||||||||||||
Government and public institutions | 8,155 | 422 | 305 | 8,882 | ||||||||||||
Other industries | 3,143 | 1,159 | 716 | 5,018 | ||||||||||||
Individuals | 1,328 | 2,134 | 6,867 | 10,329 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total domestic | 26,009 | 17,475 | 15,176 | 58,660 | ||||||||||||
Foreign: | ||||||||||||||||
Total foreign | 12,460 | 10,315 | 2,226 | 25,001 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 38,469 | 27,790 | 17,402 | 83,661 | ||||||||||||
|
|
|
|
|
|
|
|
2020:
Maturity | ||||||||||||||||
One year or less | After one year through five years | After five years | Total | |||||||||||||
(in billions of yen) | ||||||||||||||||
Domestic: | ||||||||||||||||
Manufacturing | 4,011 | 4,102 | 1,618 | 9,731 | ||||||||||||
Construction and real estate | 1,810 | 3,615 | 4,178 | 9,603 | ||||||||||||
Services | 2,564 | 2,569 | 860 | 5,993 | ||||||||||||
Wholesale and retail | 3,079 | 1,713 | 428 | 5,220 | ||||||||||||
Transportation and communications | 1,177 | 2,037 | 619 | 3,833 | ||||||||||||
Banks and other financial institutions | 1,944 | 1,712 | 979 | 4,635 | ||||||||||||
Government and public institutions | 1,616 | 315 | 268 | 2,199 | ||||||||||||
Other industries | 3,086 | 1,267 | 1,036 | 5,389 | ||||||||||||
Individuals | 1,206 | 1,933 | 6,289 | 9,428 | ||||||||||||
Total domestic | 20,493 | 19,263 | 16,275 | 56,031 | ||||||||||||
Foreign: | ||||||||||||||||
Total foreign | 15,359 | 13,638 | 2,649 | 31,646 | ||||||||||||
Total | 35,852 | 32,901 | 18,924 | 87,677 | ||||||||||||
| |||||
| |||||
(in billions of yen) | |||||
Floating rates | 39,184 | ||||
Fixed rates | 12,641 | ||||
Total | 51,825 | ||||
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 229 | 480 | 374 | 379 | 142 | |||||||||||||||
Construction and real estate | 138 | 101 | 77 | 57 | 41 | |||||||||||||||
Services | 79 | 71 | 66 | 66 | 58 | |||||||||||||||
Wholesale and retail | 156 | 150 | 147 | 147 | 131 | |||||||||||||||
Transportation and communications | 48 | 36 | 29 | 23 | 28 | |||||||||||||||
Banks and other financial institutions | 11 | 5 | 3 | 6 | 12 | |||||||||||||||
Other industries | 1 | 1 | 4 | 7 | 4 | |||||||||||||||
Individuals | 195 | 143 | 123 | 105 | 90 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total domestic | 857 | 987 | 823 | 790 | 506 | |||||||||||||||
Foreign: | ||||||||||||||||||||
Total foreign | 288 | 188 | 167 | 191 | 109 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total impaired loans | 1,145 | 1,175 | 990 | 981 | 615 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 374 | 379 | 142 | 109 | 159 | |||||||||||||||
Construction and real estate | 77 | 57 | 41 | 46 | 55 | |||||||||||||||
Services | 66 | 66 | 58 | 74 | 81 | |||||||||||||||
Wholesale and retail | 147 | 147 | 131 | 135 | 148 | |||||||||||||||
Transportation and communications | 29 | 23 | 28 | 31 | 23 | |||||||||||||||
Banks and other financial institutions | 3 | 6 | 12 | 10 | 12 | |||||||||||||||
Other industries | 4 | 7 | 4 | 9 | 19 | |||||||||||||||
Individuals | 123 | 105 | 90 | 81 | 84 | |||||||||||||||
Total domestic | 823 | 790 | 506 | 495 | 581 | |||||||||||||||
Foreign: | ||||||||||||||||||||
Total foreign | 167 | 191 | 109 | 151 | 135 | |||||||||||||||
Total impaired loans | 990 | 981 | 615 | 646 | 716 | |||||||||||||||
Public institutions | Banks | Others | Total | % of total assets | Undrawn commitments | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
2016 | ||||||||||||||||||||||||
United States | 3,928 | 261 | 4,352 | 8,541 | 4.41 | % | 8,531 | |||||||||||||||||
Germany | 1,392 | 224 | 266 | 1,882 | 0.97 | % | 338 | |||||||||||||||||
France | 1,276 | 304 | 214 | 1,794 | 0.93 | % | 540 | |||||||||||||||||
United Kingdom | 15 | 264 | 1,258 | 1,537 | 0.79 | % | 954 | |||||||||||||||||
Korea | 212 | 340 | 932 | 1,484 | 0.77 | % | 92 | |||||||||||||||||
2017 | ||||||||||||||||||||||||
United States | 2,827 | 254 | 4,950 | 8,031 | 4.01 | % | 8,279 | |||||||||||||||||
Germany | 1,243 | 190 | 305 | 1,738 | 0.87 | % | 833 | |||||||||||||||||
United Kingdom | 82 | 309 | 1,332 | 1,723 | 0.86 | % | 1,223 | |||||||||||||||||
2018 | ||||||||||||||||||||||||
United States | 3,090 | 340 | 4,231 | 7,661 | 3.75 | % | 7,137 | |||||||||||||||||
United Kingdom | 9 | 374 | 1,821 | 2,204 | 1.08 | % | 1,006 | |||||||||||||||||
Germany | 1,518 | 275 | 355 | 2,148 | 1.05 | % | 728 |
Public institutions | Banks | Others | Total | % of total assets | Undrawn commitments | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
2 018 | ||||||||||||||||||||||||
United States | 3,090 | 340 | 4,231 | 7,661 | 3.75 | % | 7,137 | |||||||||||||||||
United Kingdom | 9 | 374 | 1,821 | 2,204 | 1.08 | % | 1,006 | |||||||||||||||||
Germany | 1,518 | 275 | 355 | 2,148 | 1.05 | % | 728 | |||||||||||||||||
2019 | ||||||||||||||||||||||||
United States | 1,440 | 352 | 3,966 | 5,758 | 2.91 | % | 7,847 | |||||||||||||||||
United Kingdom | 10 | 664 | 2,829 | 3,503 | 1.77 | % | 1,210 | |||||||||||||||||
France | 1,475 | 177 | 955 | 2,607 | 1.32 | % | 619 | |||||||||||||||||
2020 | ||||||||||||||||||||||||
United States | 5,085 | 621 | 7,324 | 13,030 | 6.17 | % | 7,014 | |||||||||||||||||
United Kingdom | 6 | 570 | 3,815 | 4,391 | 2.08 | % | 893 | |||||||||||||||||
France | 734 | 278 | 1,406 | 2,418 | 1.15 | % | 629 |
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||
Allowance for loan losses at beginning of fiscal year | 773 | 626 | 520 | 451 | 480 | |||||||||||||||
Provision (credit) for loan losses | (126 | ) | (60 | ) | 35 | 38 | (126 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Charge-offs: | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 20 | 8 | 37 | 2 | 6 | |||||||||||||||
Construction and real estate | 1 | 3 | 2 | 1 | — | |||||||||||||||
Services | 3 | 2 | 4 | 3 | 5 | |||||||||||||||
Wholesale and retail | 13 | 15 | 14 | 6 | 12 | |||||||||||||||
Transportation and communications | 7 | 1 | 5 | 1 | 1 | |||||||||||||||
Individuals | 13 | 10 | 8 | 7 | 5 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total domestic | 57 | 39 | 70 | 20 | 29 | |||||||||||||||
Total foreign | 8 | 40 | 42 | 11 | 27 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total charge-offs | 65 | 79 | 112 | 31 | 56 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Recoveries: | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 6 | 2 | 2 | 1 | 1 | |||||||||||||||
Construction and real estate | 5 | 4 | 1 | 2 | 1 | |||||||||||||||
Services | 3 | 2 | 2 | 1 | 2 | |||||||||||||||
Wholesale and retail | 3 | 3 | 8 | 5 | 1 | |||||||||||||||
Transportation and communications | 3 | 1 | 1 | 4 | — | |||||||||||||||
Banks and other financial institutions | — | — | — | — | 1 | |||||||||||||||
Other industries | 1 | 1 | — | — | — | |||||||||||||||
Individuals | 3 | 3 | 2 | 3 | 2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total domestic | 24 | 16 | 16 | 16 | 8 | |||||||||||||||
Total foreign | 2 | 7 | 5 | 10 | 7 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total recoveries | 26 | 23 | 21 | 26 | 15 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Net charge-offs | 39 | 56 | 91 | 5 | 41 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Others(Note) | 18 | 10 | (13 | ) | (4 | ) | (3 | ) | ||||||||||||
Balance at end of fiscal year | 626 | 520 | 451 | 480 | 310 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Ratio of net charge-offs to average loans outstanding | 0.05 | % | 0.07 | % | 0.12 | % | 0.01 | % | 0.05 | % | ||||||||||
|
|
|
|
|
|
|
|
|
|
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||
Allowance for loan losses at beginning of fiscal year | 520 | 451 | 480 | 310 | 307 | |||||||||||||||
Provision (credit) for loan losses | 35 | 38 | (126 | ) | 32 | 156 | ||||||||||||||
Charge-offs: | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 37 | 2 | 6 | 4 | 6 | |||||||||||||||
Construction and real estate | 2 | 1 | — | 1 | 1 | |||||||||||||||
Services | 4 | 3 | 5 | 2 | 2 | |||||||||||||||
Wholesale and retail | 14 | 6 | 12 | 10 | 16 | |||||||||||||||
Transportation and communications | 5 | 1 | 1 | — | 1 | |||||||||||||||
Other industries | — | — | — | 2 | — | |||||||||||||||
Individuals | 8 | 7 | 5 | 5 | 5 | |||||||||||||||
Total domestic | 70 | 20 | 29 | 24 | 31 | |||||||||||||||
Total foreign | 42 | 11 | 27 | 24 | 13 | |||||||||||||||
Total charge-offs | 112 | 31 | 56 | 48 | 44 | |||||||||||||||
Recoveries: | ||||||||||||||||||||
Domestic: | ||||||||||||||||||||
Manufacturing | 2 | 1 | 1 | 1 | 1 | |||||||||||||||
Construction and real estate | 1 | 2 | 1 | 1 | 20 | |||||||||||||||
Services | 2 | 1 | 2 | 1 | 1 | |||||||||||||||
Wholesale and retail | 8 | 5 | 1 | 3 | 4 | |||||||||||||||
Transportation and communications | 1 | 4 | — | — | — | |||||||||||||||
Banks and other financial institutions | — | — | 1 | — | — | |||||||||||||||
Individuals | 2 | 3 | 2 | 1 | 1 | |||||||||||||||
Total domestic | 16 | 16 | 8 | 7 | 27 | |||||||||||||||
Total foreign | 5 | 10 | 7 | 7 | 1 | |||||||||||||||
Total recoveries | 21 | 26 | 15 | 14 | 28 | |||||||||||||||
Net charge-offs | 91 | 5 | 41 | 34 | 16 | |||||||||||||||
Others (Note) | (13 | ) | (4 | ) | (3 | ) | (1 | ) | (6 | ) | ||||||||||
Balance at end of fiscal year | 451 | 480 | 310 | 307 | 441 | |||||||||||||||
Ratio of net charge-offs to average loans outstanding | 0.12 | % | 0.01 | % | 0.05 | % | 0.04 | % | 0.02 | % | ||||||||||
2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||||||||||||||||||||||||||||
Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | |||||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Manufacturing | 177 | 10.90 | % | 187 | 10.52 | % | 154 | 10.74 | % | 201 | 10.60 | % | 85 | 9.75 | % | |||||||||||||||||||||||||
Construction and real estate | 51 | 9.79 | % | 33 | 9.40 | % | 25 | 9.95 | % | 20 | 9.28 | % | 17 | 9.68 | % | |||||||||||||||||||||||||
Services | 30 | 5.37 | % | 26 | 5.46 | % | 26 | 5.99 | % | 28 | 5.77 | % | 20 | 6.01 | % | |||||||||||||||||||||||||
Wholesale and retail | 65 | 7.27 | % | 66 | 7.14 | % | 58 | 6.96 | % | 63 | 6.24 | % | 52 | 6.11 | % | |||||||||||||||||||||||||
Transportation and communications | 22 | 4.41 | % | 14 | 4.04 | % | 9 | 4.20 | % | 10 | 4.23 | % | 10 | 4.26 | % | |||||||||||||||||||||||||
Banks and other financial institutions | 21 | 4.70 | % | 18 | 4.93 | % | 14 | 4.67 | % | 13 | 4.86 | % | 20 | 5.34 | % | |||||||||||||||||||||||||
Other industries(Note) | 5 | 15.92 | % | 5 | 12.39 | % | 5 | 10.31 | % | 6 | 15.72 | % | 7 | 16.62 | % | |||||||||||||||||||||||||
Individuals | 95 | 16.26 | % | 59 | 15.18 | % | 42 | 14.82 | % | 34 | 13.24 | % | 25 | 12.35 | % | |||||||||||||||||||||||||
Mortgage loans | 74 | 15.19 | % | 51 | 14.09 | % | 35 | 13.63 | % | 27 | 12.10 | % | 19 | 11.29 | % | |||||||||||||||||||||||||
Other | 21 | 1.07 | % | 8 | 1.09 | % | 7 | 1.19 | % | 7 | 1.14 | % | 6 | 1.06 | % | |||||||||||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Total domestic | 466 | 74.62 | % | 408 | 69.06 | % | 333 | 67.64 | % | 375 | 69.94 | % | 236 | 70.12 | % | |||||||||||||||||||||||||
Total foreign | 160 | 25.38 | % | 112 | 30.94 | % | 118 | 32.36 | % | 105 | 30.06 | % | 74 | 29.88 | % | |||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||
Total allowance for loan losses | 626 | 100.00 | % | 520 | 100.00 | % | 451 | 100.00 | % | 480 | 100.00 | % | 310 | 100.00 | % | |||||||||||||||||||||||||
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
2016 | 2017 | 2018 | 2019 | 2020 | ||||||||||||||||||||||||||||||||||||
Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | Amount | % of loans in each category to total loans | |||||||||||||||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||||||||||
Manufacturing | 154 | 10.72 | % | 201 | 10.59 | % | 85 | 9.74 | % | 75 | 11.52 | % | 135 | 11.10 | % | |||||||||||||||||||||||||
Construction and real estate | 25 | 10.04 | % | 20 | 9.40 | % | 17 | 9.68 | % | 18 | 10.79 | % | 40 | 10.95 | % | |||||||||||||||||||||||||
Services | 26 | 5.82 | % | 28 | 5.62 | % | 20 | 5.88 | % | 23 | 6.05 | % | 34 | 6.84 | % | |||||||||||||||||||||||||
Wholesale and retail | 58 | 6.94 | % | 63 | 6.22 | % | 52 | 6.11 | % | 48 | 6.22 | % | 69 | 5.95 | % | |||||||||||||||||||||||||
Transportation and communications | 9 | 4.31 | % | 10 | 4.33 | % | 10 | 4.34 | % | 17 | 4.45 | % | 12 | 4.37 | % | |||||||||||||||||||||||||
Banks and other financial institutions | 14 | 4.78 | % | 13 | 4.96 | % | 20 | 5.41 | % | 4 | 5.24 | % | 6 | 5.29 | % | |||||||||||||||||||||||||
Other industries (Note) | 5 | 10.31 | % | 6 | 15.72 | % | 7 | 16.61 | % | 11 | 9.44 | % | 14 | 8.66 | % | |||||||||||||||||||||||||
Individuals | 42 | 14.72 | % | 34 | 13.10 | % | 25 | 12.35 | % | 20 | 11.88 | % | 20 | 10.75 | % | |||||||||||||||||||||||||
Mortgage loans | 35 | 13.62 | % | 27 | 12.08 | % | 19 | 11.29 | % | 15 | 10.79 | % | 13 | 9.77 | % | |||||||||||||||||||||||||
Other | 7 | 1.10 | % | 7 | 1.02 | % | 6 | 1.06 | % | 5 | 1.09 | % | 7 | 0.98 | % | |||||||||||||||||||||||||
Total domestic | 333 | 67.64 | % | 375 | 69.94 | % | 236 | 70.12 | % | 216 | 65.59 | % | 330 | 63.91 | % | |||||||||||||||||||||||||
Total foreign | 118 | 32.36 | % | 105 | 30.06 | % | 74 | 29.88 | % | 91 | 34.41 | % | 111 | 36.09 | % | |||||||||||||||||||||||||
Total allowance for loan losses | 451 | 100.00 | % | 480 | 100.00 | % | 310 | 100.00 | % | 307 | 100.00 | % | 441 | 100.00 | % | |||||||||||||||||||||||||
Other industries includes government and public institutions. |
(2) | Certain loans of domestic and foreign were reclassified in order to conform to the current year’s presentation. |
2016 | 2017 | 2018 | ||||||||||||||||||||||
Average amount | Average rate | Average amount | Average rate | Average amount | Average rate | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic offices: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 13,268 | — | % | 17,310 | — | % | 19,643 | — | % | |||||||||||||||
Interest-bearing demand deposits | 38,928 | 0.02 | % | 48,986 | 0.01 | % | 56,478 | 0.01 | % | |||||||||||||||
Time deposits | 30,658 | 0.14 | % | 27,929 | 0.16 | % | 27,035 | 0.19 | % | |||||||||||||||
Certificates of deposit | 11,504 | 0.08 | % | 6,378 | 0.01 | % | 6,565 | 0.01 | % | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||
Foreign offices: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 1,429 | — | % | 2,321 | — | % | 2,244 | — | % | |||||||||||||||
Interest-bearing deposits, principally time deposits | 16,276 | 0.77 | % | 18,313 | 0.93 | % | 19,161 | 1.33 | % | |||||||||||||||
Certificates of deposit | 4,682 | 0.60 | % | 4,860 | 0.91 | % | 5,406 | 1.25 | % | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||
Total | 116,745 | 0.18 | % | 126,097 | 0.21 | % | 136,532 | 0.28 | % | |||||||||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||||||||||||||
Average amount | Average rate | Average amount | Average rate | Average amount | Average rate | |||||||||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||||||||||
Domestic offices: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 19,643 | — | % | 22,116 | — | % | 23,219 | — | % | |||||||||||||||
Interest-bearing demand deposits | 56,478 | 0.01 | % | 53,700 | 0.02 | % | 57,080 | 0.02 | % | |||||||||||||||
Time deposits | 27,035 | 0.19 | % | 26,424 | 0.31 | % | 21,943 | 0.36 | % | |||||||||||||||
Certificates of deposit | 6,565 | 0.01 | % | 7,044 | 0.01 | % | 8,120 | 0.01 | % | |||||||||||||||
Foreign offices: | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 2,244 | — | % | 1,750 | — | % | 2,093 | — | % | |||||||||||||||
Interest-bearing deposits, principally time deposits | 19,161 | 1.33 | % | 20,169 | 1.93 | % | 20,957 | 1.90 | % | |||||||||||||||
Certificates of deposit | 5,406 | 1.25 | % | 6,524 | 1.99 | % | 6,550 | 1.93 | % | |||||||||||||||
Total | 136,532 | 0.28 | % | 137,727 | 0.45 | % | 139,962 | 0.44 | % | |||||||||||||||
Time deposits | Certificates of deposit | Total | ||||||||||
(in billions of yen) | ||||||||||||
Domestic offices: | ||||||||||||
Due in three months or less | 9,046 | 5,025 | 14,071 | |||||||||
Due after three months through six months | 3,576 | 238 | 3,814 | |||||||||
Due after six months through twelve months | 3,412 | 395 | 3,807 | |||||||||
Due after twelve months | 1,161 | 120 | 1,281 | |||||||||
|
|
|
|
|
| |||||||
Total | 17,195 | 5,778 | 22,973 | |||||||||
Foreign offices | 13,427 | 5,604 | 19,031 | |||||||||
|
|
|
|
|
| |||||||
Total | 30,622 | 11,382 | 42,004 | |||||||||
|
|
|
|
|
|
Time deposits | Certificates of deposit | Total | ||||||||||
(in billions of yen) | ||||||||||||
Domestic offices: | ||||||||||||
Due in three months or less | 7,560 | 6,563 | 14,123 | |||||||||
Due after three months through six months | 2,690 | 416 | 3,106 | |||||||||
Due after six months through twelve months | 3,207 | 440 | 3,647 | |||||||||
Due after twelve months | 1,227 | 140 | 1,367 | |||||||||
Total | 14,684 | 7,559 | 22,243 | |||||||||
Foreign offices | 18,009 | 5,724 | 23,733 | |||||||||
Total | 32,693 | 13,283 | 45,976 | |||||||||
2016 | 2017 | 2018 | ||||||||||
(in billions of yen, except percentages) | ||||||||||||
Due to trust accounts: | ||||||||||||
Average balance outstanding during the fiscal year | 1,239 | 3,941 | 4,016 | |||||||||
Maximum balance outstanding at anymonth-end during the fiscal year | 4,467 | 4,123 | 4,094 | |||||||||
Balance at end of fiscal year | 4,467 | 4,123 | 3,993 | |||||||||
Weighted average interest rate during the fiscal year | 0.09 | % | 0.02 | % | 0.02 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 0.02 | % | 0.02 | % | 0.02 | % | ||||||
Call money and funds purchased, and payables under repurchase agreements and securities lending transactions: | ||||||||||||
Average balance outstanding during the fiscal year | 31,009 | 25,629 | 24,692 | |||||||||
Maximum balance outstanding at anymonth-end during the fiscal year | 35,541 | 25,968 | 25,470 | |||||||||
Balance at end of fiscal year | 22,199 | 21,144 | 20,595 | |||||||||
Weighted average interest rate during the fiscal year | 0.24 | % | 0.48 | % | 1.01 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 0.35 | % | 0.58 | % | 1.07 | % | ||||||
Other short-term borrowings: | ||||||||||||
Average balance outstanding during the fiscal year | 1,873 | 1,719 | 1,355 | |||||||||
Maximum balance outstanding at anymonth-end during the fiscal year | 2,391 | 2,135 | 1,736 | |||||||||
Balance at end of fiscal year | 2,080 | 1,477 | 1,688 | |||||||||
Weighted average interest rate during the fiscal year | 0.31 | % | 0.66 | % | 1.13 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 0.43 | % | 0.91 | % | 1.35 | % |
2018 | 2019 | 2020 | ||||||||||
(in billions of yen, except percentages) | ||||||||||||
Due to trust accounts: | ||||||||||||
Average balance outstanding during the fiscal year | 4,016 | 2,534 | 377 | |||||||||
Maximum balance outstanding at any month-end during the fiscal year | 4,094 | 4,125 | 452 | |||||||||
Balance at end of fiscal year | 3,993 | 312 | 250 | |||||||||
Weighted average interest rate during the fiscal year | 0.02 | % | 0.02 | % | 0.15 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 0.02 | % | 0.21 | % | 0.22 | % | ||||||
Call money and funds purchased, and payables under repurchase agreements and securities lending transactions: | ||||||||||||
Average balance outstanding during the fiscal year | 24,692 | 24,609 | 23,691 | |||||||||
Maximum balance outstanding at any month-end during the fiscal year | 25,470 | 27,694 | 22,616 | |||||||||
Balance at end of fiscal year | 20,595 | 19,280 | 21,658 | |||||||||
Weighted average interest rate during the fiscal year | 1.01 | % | 1.60 | % | 1.55 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 1.07 | % | 1.53 | % | 1.15 | % | ||||||
Other short-term borrowings: | ||||||||||||
Average balance outstanding during the fiscal year | 1,355 | 1,962 | 1,962 | |||||||||
Maximum balance outstanding at any month-end during the fiscal year | 1,736 | 2,091 | 4,914 | |||||||||
Balance at end of fiscal year | 1,688 | 1,995 | 4,914 | |||||||||
Weighted average interest rate during the fiscal year | 1.13 | % | 1.67 | % | 1.49 | % | ||||||
Weighted average interest rate on balance at end of fiscal year | 1.35 | % | 1.99 | % | 0.63 | % |
Page | ||||
Consolidated Financial Statements of Mizuho Financial Group, Inc. and Subsidiaries | ||||
F-7 | ||||
F-9 | ||||
F-10 | ||||
F-11 | ||||
F-12 | ||||
F-14 |
Allowance for Loan Losses—Corporate loans | ||
Description of the Matter | The Company provides an allowance for corporate loan losses of JPY 395,209 million as of March 31, 2020. As described in Notes 1 and 5 to the consolidated financial statements, management applies significant judgment in determining the obligor ratings used to segment the corporate loan portfolio and in estimating the expected future cash flows of impaired loans. Additionally, management applies significant judgment in adjusting the allowance to reflect significant uncertain economic and business conditions affecting key lending areas of the Company that are not reflected in the historical loss rates. Specifically, as of March 31, 2020, the Company identified certain industries and obligors which are most likely to be affected by the COVID-19 pandemic and adjusted its historical loss formula-based allowance for these loan groups, using assumptions such as anticipated business recovery period and current forecast for the growth rate of gross domestic product (“macroeconomic data”).Auditing the allowance for corporate loan losses is challenging because determining obligor ratings, where the Company has a quantitative evaluation system (rating model) in place and where the obligor ratings are used to segment the corporate loan portfolio, requires significant judgment. Additionally, the assumptions used in determining the macroeconomic data used for the adjustment and estimates related to the expected future cash flows that are developed when measuring the allowance for corporate loan losses on impaired loans require significant judgment. | |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the controls over the Company’s allowance for loan losses process for corporate loans. The controls tested included, but were not limited to, controls over the validation and monitoring process that covers the models used to determine the obligor ratings, controls that management periodically reviews and challenges the obligor ratings, controls that evaluates the expected future cash flows used to determine loan impairment amounts and controls that evaluates the reasonableness of significant assumptions and judgments used in adjusting the allowance. Our audit procedures included, among others, selecting a sample of borrowers and evaluating the obligor ratings for corporate loans within each segment, inspecting the evidence supporting these ratings and comparing the ratings and the related supporting evidence to management’s obligor rating definitions. We also evaluated the reasonableness of macroeconomic data used by management in estimating the adjustment of the allowance for loan losses. We involved our specialists to evaluate a sample of rating models the Company used to develop the obligor ratings and to evaluate the reasonableness of the macroeconomic data used by management in estimating the adjustment. For a sample of loans, we compared the expected future cash flows used to determine loan impairment amounts to actual past performance and the borrower’s future performance plans, when available. We also considered and evaluated relevant market and industry information, when available, that corroborated or contradicted management’s assumptions used in the adjustment, expected cash flows and obligor ratings. |
Fair Value of Certain Level 3 Financial Instruments | ||
Description of the Matter | The Company carries various types of over-the-counter derivatives (equity related contracts, interest rate contracts, foreign exchange contracts, credit-related contracts and other contracts) and long-term debt instruments with embedded derivatives measured at fair value. The Company carried JPY 74 billion, JPY 81 billion and JPY 621 billion of derivative assets, derivative liabilities and long-term debt with embedded derivatives measured at fair value, respectively. These financial instruments are categorized within Level 3 of the fair value hierarchy, which is defined as unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities, as of March 31, 2020. As described in Notes 1 and 27 to the consolidated financial statements, management utilizes internally developed valuation models and unobservable inputs to estimate the fair value of certain level 3 financial instruments. The unobservable inputs used by management to estimate the fair value of these financial instruments include correlation and volatility.Auditing management’s determination of the fair value of certain level 3 financial instruments is challenging because the determination of certain significant unobservable inputs requires significant judgment and effort in performing procedures related to the fair value of these instruments. | |
How We Addressed the Matter in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of the controls over the Company’s derivatives and debt fair valuation processes. The controls tested included, but were not limited to, controls over significant inputs included in the fair value measurements and controls over the appropriateness of the valuation techniques utilized within the internally developed valuation models. Our audit procedures included, among others, evaluating the valuation techniques used, testing certain significant unobservable inputs used, comparing the Company’s valuation inputs to independent, third-party market information, where available, and testing the mathematical accuracy of the Company’s valuation calculation. We involved our specialists to evaluate certain significant unobservable inputs, the sensitivity of the inputs and the valuation techniques utilized within the internally developed valuation models. |
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Assets: | ||||||||
Cash and due from banks | 1,592,191 | 1,685,835 | ||||||
Interest-bearing deposits in other banks | 45,994,780 | 46,485,086 | ||||||
Call loans and funds sold | 1,037,986 | 720,461 | ||||||
Receivables under resale agreements | 8,967,712 | 8,080,927 | ||||||
Receivables under securities borrowing transactions | 3,350,052 | 4,408,508 | ||||||
Trading account assets (including assets pledged that secured parties are permitted to sell or repledge of ¥5,861,942 million in 2017 and ¥4,897,190 million in 2018) | 24,998,493 | 24,302,543 | ||||||
Investments (Note 4): | ||||||||
Available-for-sale securities (including assets pledged that secured parties are permitted to sell or repledge of ¥442,775 million in 2017 and ¥932,302 million in 2018) | 20,557,118 | 23,665,628 | ||||||
Held-to-maturity securities (including assets pledged that secured parties are permitted to sell or repledge of ¥1,050,714 million in 2017 and ¥677,046 million in 2018) | 3,817,360 | 2,517,551 | ||||||
Other investments | 595,069 | 585,896 | ||||||
Loans (Notes 5 and 6) | 82,283,906 | 83,514,644 | ||||||
Allowance for loan losses | (479,673 | ) | (309,902 | ) | ||||
|
|
|
| |||||
Loans, net of allowance | 81,804,233 | 83,204,742 | ||||||
Premises and equipment—net (Note 7) | 2,041,273 | 2,116,184 | ||||||
Due from customers on acceptances | 184,171 | 212,596 | ||||||
Accrued income | 270,694 | 301,332 | ||||||
Goodwill (Note 8) | 95,176 | 95,184 | ||||||
Intangible assets (Note 8) | 94,147 | 84,447 | ||||||
Deferred tax assets | 63,520 | 57,088 | ||||||
Other assets (Note 13) | 4,992,329 | 5,731,634 | ||||||
|
|
|
| |||||
Total assets | 200,456,304 | 204,255,642 | ||||||
|
|
|
| |||||
The following table presents the assets of consolidated variable interest entities (“VIE”s), which are included in the consolidated balance sheets above. The assets in the table below can be used only to settle obligations of consolidated VIEs.
|
| |||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Assets of consolidated VIEs: | ||||||||
Cash and due from banks | 96,077 | 31,435 | ||||||
Interest-bearing deposits in other banks | 81,807 | 95,048 | ||||||
Trading account assets | 2,099,890 | 2,558,186 | ||||||
Investments | 46,180 | 48,565 | ||||||
Loans, net of allowance | 2,149,321 | 2,323,081 | ||||||
All other assets | 772,290 | 811,453 | ||||||
|
|
|
| |||||
Total assets | 5,245,565 | 5,867,768 | ||||||
|
|
|
|
2020
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Assets: | ||||||||
Cash and due from banks | 1,404,008 | 2,325,139 | ||||||
Interest-bearing deposits in other banks | 44,268,731 | 39,625,975 | ||||||
Call loans and funds sold | 763,453 | 1,006,991 | ||||||
Receivables under resale agreements | 12,997,424 | 18,580,919 | ||||||
Receivables under securities borrowing transactions | 2,578,134 | 2,216,059 | ||||||
Trading account assets (including assets pledged that secured parties are permitted to sell or repledge of ¥3,244,305 million in 2019 and ¥4,978,497 million in 2020) | 21,018,230 | 28,092,871 | ||||||
Investments (Note 3): | ||||||||
Available-for-sale securities (including assets pledged that secured parties are permitted to sell or repledge of ¥1,132,602 million in 2019 and ¥1,036,534 million in 2020) | 18,133,916 | 19,112,952 | ||||||
Held-to-maturity securities (including assets pledged that secured parties are permitted to sell or repledge of ¥476,146 million in 2019 and ¥297,240 million in 2020) | 1,604,104 | 862,031 | ||||||
Equity securities | 4,034,609 | 3,256,717 | ||||||
Other investments | 389,740 | 443,951 | ||||||
Loans (Notes 4 and 5) | 82,799,943 | 87,528,088 | ||||||
Allowance for loan losses | (307,201 | ) | (440,855 | ) | ||||
Loans, net of allowance | 82,492,742 | 87,087,233 | ||||||
Premises and equipment—net (Note 6) | 1,900,952 | 1,856,248 | ||||||
Due from customers on acceptances | 187,137 | 167,764 | ||||||
Accrued income | 342,845 | 323,632 | ||||||
Goodwill (Note 7) | 95,151 | 92,997 | ||||||
Intangible assets (Note 7) | 74,240 | 64,689 | ||||||
Deferred tax assets | 49,775 | 136,713 | ||||||
Other assets (Note 12) | 5,276,004 | 5,965,879 | ||||||
Total assets | 197,611,195 | 211,218,760 | ||||||
The following table presents the assets of consolidated variable interest entities (“VIE”s), which are included in the consolidated balance sheets above. The assets in the table below can be used only to settle obligations of consolidated VIEs. | ||||||||
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Assets of consolidated VIEs: | ||||||||
Cash and due from banks | 29,972 | 8,749 | ||||||
Interest-bearing deposits in other banks | 31,676 | 61,439 | ||||||
Call loans and funds sold | 115,199 | 422,304 | ||||||
Trading account assets | 2,456,198 | 2,438,607 | ||||||
Investments | 52,493 | 62,262 | ||||||
Loans, net of allowance | 2,359,669 | 2,285,831 | ||||||
All other assets | 1,003,133 | 535,954 | ||||||
Total assets | 6,048,340 | 5,815,146 | ||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Liabilities and equity: | ||||||||
Deposits : | ||||||||
Domestic: | ||||||||
Noninterest-bearing deposits | 19,063,774 | 21,068,569 | ||||||
Interest-bearing deposits | 87,358,504 | 91,206,963 | ||||||
Foreign: | ||||||||
Noninterest-bearing deposits | 1,996,450 | 2,257,350 | ||||||
Interest-bearing deposits | 22,766,225 | 22,351,124 | ||||||
Due to trust accounts | 4,123,088 | 3,992,544 | ||||||
Call money and funds purchased | 1,255,172 | 2,105,294 | ||||||
Payables under repurchase agreements (Note 30) | 17,969,941 | 16,656,930 | ||||||
Payables under securities lending transactions (Note 30) | 1,919,249 | 1,832,870 | ||||||
Other short-term borrowings (Note 12) | 1,476,612 | 1,688,018 | ||||||
Trading account liabilities | 13,591,740 | 13,115,270 | ||||||
Bank acceptances outstanding | 184,171 | 212,596 | ||||||
Income taxes payable | 73,598 | 64,501 | ||||||
Deferred tax liabilities | 140,475 | 306,203 | ||||||
Accrued expenses | 209,309 | 232,885 | ||||||
Long-term debt (including liabilities accounted for at fair value of ¥1,496,488 million in 2017, and ¥1,955,636million in 2018) (Notes 12 and 28) | 14,529,414 | 12,955,230 | ||||||
Other liabilities (Note 13) | 5,026,525 | 4,705,595 | ||||||
|
|
|
| |||||
Total liabilities | 191,684,247 | 194,751,942 | ||||||
|
|
|
| |||||
Commitments and contingencies (Note 24) | ||||||||
Equity: | ||||||||
MHFG shareholders’ equity: | ||||||||
Common stock (Note 15)—no par value, authorized 48,000,000,000 shares in 2017 and 2018, and issued 25,386,307,945 shares in 2017, and 25,389,644,945 shares in 2018 | 5,826,149 | 5,826,383 | ||||||
Retained earnings | 918,894 | 1,306,141 | ||||||
Accumulated other comprehensive income, net of tax (Note 17) | 1,521,163 | 1,741,894 | ||||||
Less: Treasury stock, at cost—Common stock 19,992,754 shares in 2017, and 24,829,446 shares in 2018 | (4,849 | ) | (5,997 | ) | ||||
|
|
|
| |||||
Total MHFG shareholders’ equity | 8,261,357 | 8,868,421 | ||||||
Noncontrolling interests | 510,700 | 635,279 | ||||||
|
|
|
| |||||
Total equity | 8,772,057 | 9,503,700 | ||||||
|
|
|
| |||||
Total liabilities and equity | 200,456,304 | 204,255,642 | ||||||
|
|
|
|
2020
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Liabilities and equity: | ||||||||
Deposits: | ||||||||
Domestic: | ||||||||
Noninterest-bearing deposits | 23,844,639 | 28,109,943 | ||||||
Interest-bearing deposits | 84,019,038 | 86,651,036 | ||||||
Foreign: | ||||||||
Noninterest-bearing deposits | 1,793,803 | 2,186,203 | ||||||
Interest-bearing deposits | 28,639,436 | 28,001,485 | ||||||
Due to trust accounts | 312,347 | 249,737 | ||||||
Call money and funds purchased | 2,841,932 | 2,263,076 | ||||||
Payables under repurchase agreements (Note 29) | 14,640,369 | 17,970,662 | ||||||
Payables under securities lending transactions (Note 29) | 1,797,737 | 1,423,638 | ||||||
Other short-term borrowings (Note 11) | 1,994,826 | 4,914,485 | ||||||
Trading account liabilities | 10,120,968 | 12,416,785 | ||||||
Bank acceptances outstanding | 187,137 | 167,764 | ||||||
Income taxes payable | 58,688 | 68,557 | ||||||
Deferred tax liabilities | 108,120 | 25,874 | ||||||
Accrued expenses | 288,556 | 249,344 | ||||||
Long-term debt (including liabilities accounted for at fair value of ¥2,433,294 million in 2019, and ¥2,537,082 million in 2020) (Notes 11 and 27) | 11,529,400 | 10,346,152 | ||||||
Other liabilities (Note 12) | 5,932,706 | 6,998,395 | ||||||
Total liabilities | 188,109,702 | 202,043,136 | ||||||
Commitments and contingencies (Note 23) | ||||||||
Equity: | ||||||||
MHFG shareholders’ equity: | ||||||||
Common stock (Note 14)—0 par value, authorized 48,000,000,000 shares in 2019 and 2020, and issued 25,392,498,945 shares in 2019 and 2020 | 5,829,657 | 5,827,500 | ||||||
Retained earnings | 2,740,545 | 2,700,774 | ||||||
Accumulated other comprehensive income (loss), net of tax (Note 16) | 164,021 | (9,494 | ) | |||||
Less: Treasury stock, at cost—Common stock 33,962,404 shares in 2019, and 32,106,811 shares in 2020 | (7,704 | ) | (6,415 | ) | ||||
Total MHFG shareholders’ equity | 8,726,519 | 8,512,365 | ||||||
Noncontrolling interests | 774,974 | 663,259 | ||||||
Total equity | 9,501,493 | 9,175,624 | ||||||
Total liabilities and equity | 197,611,195 | 211,218,760 | ||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Liabilities of consolidated VIEs: | ||||||||
Other short-term borrowings | 60,575 | 31,392 | ||||||
Trading account liabilities | 7,723 | 22 | ||||||
Long-term debt | 431,190 | 419,649 | ||||||
All other liabilities | 1,147,895 | 1,305,640 | ||||||
|
|
|
| |||||
Total liabilities | 1,647,383 | 1,756,703 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Liabilities of consolidated VIEs: | ||||||||
Payables under securities lending transactions | 108,038 | 138,094 | ||||||
Other short-term borrowings | 23,495 | 60,086 | ||||||
Trading account liabilities | — | 34,205 | ||||||
Long-term debt | 344,526 | 330,863 | ||||||
All other liabilities | 1,523,791 | 948,715 | ||||||
Total liabilities | 1,999,850 | 1,511,963 | ||||||
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Interest and dividend income: | ||||||||||||
Loans, including fees | 1,030,802 | 1,009,094 | 1,109,776 | |||||||||
Investments: | ||||||||||||
Interest | 110,411 | 88,311 | 88,319 | |||||||||
Dividends | 79,600 | 77,343 | 86,066 | |||||||||
Trading account assets | 151,278 | 163,114 | 202,125 | |||||||||
Call loans and funds sold | 6,983 | 5,068 | 5,699 | |||||||||
Receivables under resale agreements and securities borrowing transactions | 53,007 | 91,453 | 149,197 | |||||||||
Deposits | 68,090 | 74,647 | 120,704 | |||||||||
|
|
|
|
|
| |||||||
Total interest and dividend income | 1,500,171 | 1,509,030 | 1,761,886 | |||||||||
|
|
|
|
|
| |||||||
Interest expense: | ||||||||||||
Deposits | 213,601 | 264,748 | 382,706 | |||||||||
Trading account liabilities | 21,031 | 21,399 | 41,514 | |||||||||
Call money and funds purchased | 7,830 | 3,173 | 5,031 | |||||||||
Payables under repurchase agreements and securities lending transactions | 66,579 | 120,578 | 243,569 | |||||||||
Other short-term borrowings | 6,791 | 12,175 | 16,166 | |||||||||
Long-term debt | 179,575 | 179,639 | 200,950 | |||||||||
|
|
|
|
|
| |||||||
Total interest expense | 495,407 | 601,712 | 889,936 | |||||||||
|
|
|
|
|
| |||||||
Net interest income | 1,004,764 | 907,318 | 871,950 | |||||||||
Provision (credit) for loan losses (Note 6) | 34,560 | 37,668 | (126,362 | ) | ||||||||
|
|
|
|
|
| |||||||
Net interest income after provision (credit) for loan losses | 970,204 | 869,650 | 998,312 | |||||||||
|
|
|
|
|
| |||||||
Noninterest income: | ||||||||||||
Fee and commission income (Note 26) | 804,756 | 825,963 | 865,711 | |||||||||
Foreign exchange gains (losses)—net (Note 27) | 113,553 | 69,453 | 91,793 | |||||||||
Trading account gains (losses)—net (Note 27) | 559,139 | (42,481 | ) | 236,982 | ||||||||
Investment gains (losses)—net | 263,793 | 333,270 | 297,157 | |||||||||
Equity in earnings (losses) of equity method investees—net | 28,969 | 26,785 | 24,342 | |||||||||
Gains on disposal of premises and equipment | 10,223 | 5,638 | 8,225 | |||||||||
Other noninterest income | 103,461 | 149,404 | 80,453 | |||||||||
|
|
|
|
|
| |||||||
Total noninterest income | 1,883,894 | 1,368,032 | 1,604,663 | |||||||||
|
|
|
|
|
| |||||||
Noninterest expenses: | ||||||||||||
Salaries and employee benefits | 633,557 | 663,166 | 688,481 | |||||||||
General and administrative expenses | 548,027 | 570,897 | 585,992 | |||||||||
Impairment of goodwill (Note 8) | 6,222 | — | — | |||||||||
Occupancy expenses | 195,898 | 194,955 | 191,592 | |||||||||
Fee and commission expenses | 164,039 | 177,006 | 189,187 | |||||||||
Provision (credit) for losses on off-balance-sheet instruments | (16,447 | ) | 19,464 | (30,244 | ) | |||||||
Other noninterest expenses | 126,197 | 131,819 | 138,669 | |||||||||
|
|
|
|
|
| |||||||
Total noninterest expenses | 1,657,493 | 1,757,307 | 1,763,677 | |||||||||
|
|
|
|
|
| |||||||
Income before income tax expense | 1,196,605 | 480,375 | 839,298 | |||||||||
Income tax expense (Note 20) | 346,542 | 91,244 | 237,604 | |||||||||
|
|
|
|
|
| |||||||
Net income | 850,063 | 389,131 | 601,694 | |||||||||
Less: Net income (loss) attributable to noncontrolling interests | (429 | ) | 26,691 | 24,086 | ||||||||
|
|
|
|
|
| |||||||
Net income attributable to MHFG shareholders | 850,492 | 362,440 | 577,608 | |||||||||
|
|
|
|
|
| |||||||
Earnings per common share (Note 19): | (in yen) | |||||||||||
Basic net income per common share | 34.19 | 14.33 | 22.77 | |||||||||
|
|
|
|
|
| |||||||
Diluted net income per common share | 33.50 | 14.28 | 22.76 | |||||||||
|
|
|
|
|
|
2020
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Interest and dividend income: | ||||||||||||
Loans, including fees | 1,109,776 | 1,381,553 | 1,380,828 | |||||||||
Investments: | ||||||||||||
Interest | 88,319 | 144,199 | 89,749 | |||||||||
Dividends | 86,066 | 88,289 | 76,150 | |||||||||
Trading account assets | 202,125 | 211,749 | 221,983 | |||||||||
Call loans and funds sold | 5,699 | 5,547 | 5,434 | |||||||||
Receivables under resale agreements and securities borrowing transactions | 149,197 | 254,862 | 271,598 | |||||||||
Deposits in other banks | 120,704 | 121,244 | 105,430 | |||||||||
Total interest and dividend income | 1,761,886 | 2,207,443 | 2,151,172 | |||||||||
Interest expense: | ||||||||||||
Deposits | 382,706 | 613,570 | 615,785 | |||||||||
Trading account liabilities | 41,514 | 49,660 | 52,955 | |||||||||
Call money and funds purchased | 5,031 | 11,121 | 8,830 | |||||||||
Payables under repurchase agreements and securities lending transactions | 243,569 | 382,045 | 358,862 | |||||||||
Other short-term borrowings | 16,166 | 33,313 | 29,813 | |||||||||
Long-term debt | 200,950 | 223,767 | 205,136 | |||||||||
Total interest expense | 889,936 | 1,313,476 | 1,271,381 | |||||||||
Net interest income | 871,950 | 893,967 | 879,791 | |||||||||
Provision (credit) for loan losses (Note 5) | (126,362 | ) | 32,459 | 156,200 | ||||||||
Net interest income after provision (credit) for loan losses | 998,312 | 861,508 | 723,591 | |||||||||
Noninterest income (Note 25): | ||||||||||||
Fee and commission income | 865,711 | 853,290 | 867,885 | |||||||||
Foreign exchange gains (losses)—net (Note 26) | 91,793 | 93,577 | 44,345 | |||||||||
Trading account gains (losses)—net (Note 26) | 236,982 | 328,841 | 745,692 | |||||||||
Investment gains (losses)—net (Note 2): | ||||||||||||
Debt securities | 7,757 | (3,842 | ) | 31,032 | ||||||||
Equity securities | 289,400 | (155,947 | ) | (557,391 | ) | |||||||
Equity in earnings (losses) of equity method investees—net | 24,342 | 29,172 | 34,012 | |||||||||
Gains on disposal of premises and equipment | 8,225 | 5,145 | 2,583 | |||||||||
Other noninterest income | 80,453 | 72,135 | 139,582 | |||||||||
Total noninterest income | 1,604,663 | 1,222,371 | 1,307,740 | |||||||||
Noninterest expenses: | ||||||||||||
Salaries and employee benefits | 688,481 | 682,645 | 677,332 | |||||||||
General and administrative expenses | 585,992 | 761,528 | 649,498 | |||||||||
Occupancy expenses | 191,592 | 207,814 | 214,851 | |||||||||
Fee and commission expenses | 189,187 | 189,722 | 194,010 | |||||||||
Provision (credit) for losses on off-balance-sheet instruments | (30,244 | ) | (8,969 | ) | 19,262 | |||||||
Other noninterest expenses | 138,669 | 166,079 | 122,888 | |||||||||
Total noninterest expenses | 1,763,677 | 1,998,819 | 1,877,841 | |||||||||
Income before income tax expense | 839,298 | 85,060 | 153,490 | |||||||||
Income tax expense (Note 19) | 237,604 | 9,335 | 47,175 | |||||||||
Net income | 601,694 | 75,725 | 106,315 | |||||||||
Less: Net income (loss) attributable to noncontrolling interests | 24,086 | (8,746 | ) | (43,880 | ) | |||||||
Net income attributable to MHFG shareholders | 577,608 | 84,471 | 150,195 | |||||||||
Earnings per common share (Note 18): | (in yen) | |||||||||||
Basic net income per common share | 22.77 | 3.33 | 5.92 | |||||||||
Diluted net income per common share | 22.76 | 3.33 | 5.92 | |||||||||
Dividends per share: | ||||||||||||
Class XI preferred stock | — | — | — | |||||||||
Common stock | 7.50 | 7.50 | 7.50 | |||||||||
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Net income (1) | 601,694 | 75,725 | 106,315 | |||||||||
Other comprehensive income (loss), net of tax: | ||||||||||||
Net unrealized gains (losses) on available-for-sale securities, net of tax | 97,428 | (9,472 | ) | (41,483 | ) | |||||||
Foreign currency translation adjustments, net of tax | (29,934 | ) | (23,781 | ) | (50,576 | ) | ||||||
Pension liability adjustments, net of tax | 155,044 | (24,168 | ) | (126,915 | ) | |||||||
Own credit risk adjustments, net of tax (2) | — | 14,476 | 46,919 | |||||||||
Total other comprehensive income (loss), net of tax | 222,538 | (42,945 | ) | (172,055 | ) | |||||||
Total comprehensive income (loss) | 824,232 | 32,780 | (65,740 | ) | ||||||||
Less: Total comprehensive income (loss) attributable to noncontrolling interests | 25,893 | (8,960 | ) | (43,472 | ) | |||||||
Total comprehensive income (loss) attributable to MHFG shareholders | 798,339 | 41,740 | (22,268 | ) | ||||||||
(1) | The amounts that have been reclassified out of Accumulated other comprehensive income (loss), net of tax into net income are presented in Note 16 “Accumulated other comprehensive income (loss), net of tax.” |
(2) | The MHFG Group adopted ASU No.2016-01 on April 1, 2018. The ASU requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. See Note 2 “Issued accounting pronouncements” for further details. |
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Net income | 850,063 | 389,131 | 601,694 | |||||||||
|
|
|
|
|
| |||||||
Other comprehensive income (loss), net of tax: | ||||||||||||
Net unrealized gains (losses) onavailable-for-sale securities, net of tax | (338,822 | ) | 51,957 | 97,428 | ||||||||
Foreign currency translation adjustments, net of tax | (123,221 | ) | (12,322 | ) | (29,934 | ) | ||||||
Pension liability adjustments, net of tax | (111,599 | ) | 11,922 | 155,044 | ||||||||
|
|
|
|
|
| |||||||
Total other comprehensive income (loss), net of tax | (573,642 | ) | 51,557 | 222,538 | ||||||||
|
|
|
|
|
| |||||||
Total comprehensive income | 276,421 | 440,688 | 824,232 | |||||||||
Less: Total comprehensive income (loss) attributable to noncontrolling interests | (2,373 | ) | 26,724 | 25,893 | ||||||||
|
|
|
|
|
| |||||||
Total comprehensive income attributable to MHFG shareholders | 278,794 | 413,964 | 798,339 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Common stock: | ||||||||||||
Balance at beginning of fiscal year | 5,826,149 | 5,826,383 | 5,829,657 | |||||||||
Issuance of new shares of common stock due to exercise of stock acquisition rights | 546 | 438 | — | |||||||||
Performance-based stock compensation program | (326 | ) | (282 | ) | (178 | ) | ||||||
Other | 14 | 3,118 | (1,979 | ) | ||||||||
Balance at end of fiscal year | 5,826,383 | 5,829,657 | 5,827,500 | |||||||||
Retained earnings: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 918,894 | 1,306,141 | 2,740,545 | |||||||||
Cumulative effect of change in accounting principles, net of tax (Note 2) | — | 1,540,317 | 1,052 | |||||||||
Balance at beginning of fiscal year, adjusted | 918,894 | 2,846,458 | 2,741,597 | |||||||||
Net income attributable to MHFG shareholders | 577,608 | 84,471 | 150,195 | |||||||||
Dividends declared | (190,361 | ) | (190,384 | ) | (190,406 | ) | ||||||
Other | — | — | (612 | ) | ||||||||
Balance at end of fiscal year | 1,306,141 | 2,740,545 | 2,700,774 | |||||||||
Accumulated other comprehensive income (loss) , net of tax (Note 16): | ||||||||||||
Balance at beginning of fiscal year, previously reported | 1,521,163 | 1,741,894 | 164,021 | |||||||||
Cumulative effect of change in accounting principles (Note 2) | — | (1,535,142 | ) | (1,052 | ) | |||||||
Balance at beginning of fiscal year, adjusted | 1,521,163 | 206,752 | 162,969 | |||||||||
Change during year | 220,731 | (42,731 | ) | (172,463 | ) | |||||||
Balance at end of fiscal year | 1,741,894 | 164,021 | (9,494 | ) | ||||||||
Treasury stock, at cost: | ||||||||||||
Balance at beginning of fiscal year | (4,849 | ) | (5,997 | ) | (7,704 | ) | ||||||
Purchases of treasury stock | (2,431 | ) | (3,002 | ) | (1,908 | ) | ||||||
Disposal of treasury stock | 1,283 | 1,295 | 3,197 | |||||||||
Balance at end of fiscal year | (5,997 | ) | (7,704 | ) | (6,415 | ) | ||||||
Total MHFG shareholders’ equity | 8,868,421 | 8,726,519 | 8,512,365 | |||||||||
Noncontrolling interests: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 510,700 | 635,279 | 774,974 | |||||||||
Cumulative effect of change in accounting principles | — | (616 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | 510,700 | 634,663 | 774,974 | |||||||||
Transactions between the MHFG Group and the noncontrolling interest shareholders | 106,740 | 166,145 | (52,521 | ) | ||||||||
Dividends paid to noncontrolling interests | (8,054 | ) | (16,874 | ) | (15,722 | ) | ||||||
Net income (loss) attributable to noncontrolling interests | 24,086 | (8,746 | ) | (43,880 | ) | |||||||
Other | 1,807 | (214 | ) | 408 | ||||||||
Balance at end of fiscal year | 635,279 | 774,974 | 663,259 | |||||||||
Total equity | 9,503,700 | 9,501,493 | 9,175,624 | |||||||||
Note: | The amounts that have been reclassified out of Accumulated other comprehensive income (loss), net of tax into net income are presented in Note (loss), net of tax.” |
CASH FLOWS
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Preferred stock: | ||||||||||||
Balance at beginning of fiscal year | 213,121 | 98,924 | — | |||||||||
Conversion to common stock | (114,197 | ) | (98,924 | ) | — | |||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 98,924 | — | — | |||||||||
|
|
|
|
|
| |||||||
Common stock: | ||||||||||||
Balance at beginning of fiscal year | 5,590,396 | 5,703,144 | 5,826,149 | |||||||||
Issuance of new shares of common stock due to conversion of preferred stock | 114,197 | 98,924 | — | |||||||||
Issuance of new shares of common stock due to exercise of stock acquisition rights | 772 | 969 | 546 | |||||||||
Gains (losses) on disposal of treasury stock | 82 | (56 | ) | (53 | ) | |||||||
Stock-based compensation related to stock option | (1,058 | ) | (1,009 | ) | (590 | ) | ||||||
Performance-based stock compensation program | — | 354 | 264 | |||||||||
Change in ownership interests in consolidated subsidiaries | (1,245 | ) | 23,824 | 67 | ||||||||
Cancellation of treasury stock | — | (1 | ) | — | ||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 5,703,144 | 5,826,149 | 5,826,383 | |||||||||
|
|
|
|
|
| |||||||
Retained earnings: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 89,432 | 746,785 | 918,894 | |||||||||
Cumulative effect of change in accounting principles, net of tax | — | (329 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | 89,432 | 746,456 | 918,894 | |||||||||
Net income attributable to MHFG shareholders | 850,492 | 362,440 | 577,608 | |||||||||
Dividends declared | (195,265 | ) | (190,002 | ) | (190,361 | ) | ||||||
Other | 2,126 | — | — | |||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 746,785 | 918,894 | 1,306,141 | |||||||||
|
|
|
|
|
| |||||||
Accumulated other comprehensive income, net of tax (Note 17): | ||||||||||||
Balance at beginning of fiscal year, previously reported | 2,041,005 | 1,469,308 | 1,521,163 | |||||||||
Cumulative effect of change in accounting principles | — | 330 | — | |||||||||
Balance at beginning of fiscal year, adjusted | 2,041,005 | 1,469,638 | 1,521,163 | |||||||||
Change during year | (571,697 | ) | 51,525 | 220,731 | ||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 1,469,308 | 1,521,163 | 1,741,894 | |||||||||
|
|
|
|
|
| |||||||
Treasury stock, at cost: | ||||||||||||
Balance at beginning of fiscal year | (3,616 | ) | (3,610 | ) | (4,849 | ) | ||||||
Purchases of treasury stock | (653 | ) | (1,903 | ) | (2,431 | ) | ||||||
Disposal of treasury stock | 659 | 663 | 1,283 | |||||||||
Cancellation of treasury stock | — | 1 | — | |||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | (3,610 | ) | (4,849 | ) | (5,997 | ) | ||||||
|
|
|
|
|
| |||||||
Total MHFG shareholders’ equity | 8,014,551 | 8,261,357 | 8,868,421 | |||||||||
|
|
|
|
|
|
2020
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | 601,694 | 75,725 | 106,315 | |||||||||
Less: Net income (loss) attributable to noncontrolling interests | 24,086 | (8,746 | ) | (43,880 | ) | |||||||
Net income attributable to MHFG shareholders | 577,608 | 84,471 | 150,195 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||
Depreciation and amortization | 179,158 | 355,164 | 243,724 | |||||||||
Provision (credit) for loan losses | (126,362 | ) | 32,459 | 156,200 | ||||||||
Investment losses (gains)—net | (297,157 | ) | 159,789 | 526,359 | ||||||||
Equity in losses (earnings) of equity method investees—net | (24,342 | ) | (29,172 | ) | (34,012 | ) | ||||||
Foreign exchange losses (gains)—net | (251,613 | ) | 155,104 | (139,900 | ) | |||||||
Deferred income tax expense (benefit) | 60,011 | (157,231 | ) | (101,941 | ) | |||||||
Net change in trading account assets | 992,084 | 2,776,764 | (7,460,802 | ) | ||||||||
Net change in trading account liabilities | (518,339 | ) | (2,979,299 | ) | 2,599,090 | |||||||
Net change in loans held for sale | (54,530 | ) | 26,659 | (60,189 | ) | |||||||
Net change in accrued income | (31,842 | ) | (44,519 | ) | 14,060 | |||||||
Net change in accrued expenses | 16,517 | 45,653 | (24,345 | ) | ||||||||
Other—net | (682,269 | ) | 235,177 | 90,489 | ||||||||
Net cash provided by (used in) operating activities | (161,076 | ) | 661,019 | (4,041,072 | ) | |||||||
Cash flows from investing activities: | ||||||||||||
Proceeds from sales of Available-for-sale securities(1) | 32,908,551 | 21,132,162 | 21,153,866 | |||||||||
Proceeds from sales of Equity securities (2) | — | 3,973,437 | 3,123,341 | |||||||||
Proceeds from maturities of Available-for-sale securities(1) | 13,819,828 | 15,673,340 | 15,350,105 | |||||||||
Proceeds from maturities of Held-to-maturity securities | 1,261,607 | 939,397 | 731,686 | |||||||||
Purchases of Available-for-sale securities(1) | (49,722,644 | ) | (34,327,798 | ) | (37,445,206 | ) | ||||||
Purchases of Held-to-maturity securities | (2,982 | ) | (2,042 | ) | — | |||||||
Purchases of Equity securities (2) | — | (3,429,923 | ) | (2,900,020 | ) | |||||||
Proceeds from sales of loans | 296,260 | 1,184,160 | 1,729,513 | |||||||||
Net change in loans | (1,971,210 | ) | (3,852,757 | ) | (7,512,885 | ) | ||||||
Net change in call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 54,786 | (2,971,007 | ) | (5,812,860 | ) | |||||||
Proceeds from sales of premises and equipment | 22,302 | 7,812 | 16,825 | |||||||||
Purchases of premises and equipment | (292,201 | ) | (157,714 | ) | (243,022 | ) | ||||||
Proceeds from sales of investments in subsidiaries (affecting the scope of consolidation) | 948 | 220 | 1,068 | |||||||||
Cash outflow from deconsolidation of a subsidiary | — | (4,943,059 | ) | — | ||||||||
Net cash used in investing activities | (3,624,755 | ) | (6,773,772 | ) | (11,807,589 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Net change in deposits | 6,083,800 | 3,065,826 | 7,920,701 | |||||||||
Net change in call money and funds purchased, and payables under repurchase agreements and securities lending transactions | (67,508 | ) | 1,703,606 | 2,754,646 | ||||||||
Net change in due to trust accounts | (130,544 | ) | (59,373 | ) | (62,610 | ) | ||||||
Net change in other short-term borrowings | 257,774 | 270,560 | 2,936,677 | |||||||||
Proceeds from issuance of long-term debt | 1,956,007 | 1,659,412 | 2,303,803 | |||||||||
Repayment of long-term debt | (3,310,804 | ) | (3,241,799 | ) | (3,273,353 | ) | ||||||
Proceeds from noncontrolling interests | 76,894 | 219,187 | 131,795 | |||||||||
Payments to noncontrolling interests | (12,949 | ) | (579 | ) | (148,673 | ) | ||||||
Proceeds from issuance of common stock | 3 | 3 | — | |||||||||
Proceeds from sales of treasury stock | 1 | 953 | 1,517 | |||||||||
Purchases of treasury stock | (1,611 | ) | (2,124 | ) | (1,441 | ) | ||||||
Dividends paid | (190,382 | ) | (190,413 | ) | (190,386 | ) | ||||||
Dividends paid to noncontrolling interests | (8,054 | ) | (16,874 | ) | (15,722 | ) | ||||||
Net cash provided by financing activities | 4,652,627 | 3,408,385 | 12,356,954 | |||||||||
Effect of exchange rate changes on cash and cash equivalents | (282,846 | ) | 206,186 | (229,918 | ) | |||||||
Net increase (decrease) in cash and cash equivalents | 583,950 | (2,498,182 | ) | (3,721,625 | ) | |||||||
Cash and cash equivalents at beginning of fiscal year | 47,586,971 | 48,170,921 | 45,672,739 | |||||||||
Cash and cash equivalents at end of fiscal year | 48,170,921 | 45,672,739 | 41,951,114 | |||||||||
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Noncontrolling interests: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 259,506 | 168,640 | 510,700 | |||||||||
Cumulative effect of change in accounting principles | — | (10,441 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | 259,506 | 158,199 | 510,700 | |||||||||
Effect of other increase (decrease) in consolidated subsidiaries | (85,809 | ) | 328,692 | 106,740 | ||||||||
Dividends paid to noncontrolling interests | (2,683 | ) | (2,914 | ) | (8,054 | ) | ||||||
Net income (loss) attributable to noncontrolling interests | (429 | ) | 26,691 | 24,086 | ||||||||
Net unrealized gains (losses) on available-for-sale securities attributable to noncontrolling interests | (674 | ) | 29 | 2,145 | ||||||||
Foreign currency translation adjustments attributable to noncontrolling interests | (352 | ) | (62 | ) | (393 | ) | ||||||
Pension liability adjustments attributable to noncontrolling interests | (919 | ) | 65 | 55 | ||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 168,640 | 510,700 | 635,279 | |||||||||
|
|
|
|
|
| |||||||
Total equity | 8,183,191 | 8,772,057 | 9,503,700 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Supplemental disclosure of cash flow information: | ||||||||||||
Interest paid | 818,593 | 1,268,412 | 1,321,358 | |||||||||
Income taxes paid | 172,891 | 175,615 | 97,630 | |||||||||
Noncash investing activities: | ||||||||||||
Transfer of loans into loans held-for-sale | 35,166 | 2,728 | 29,953 | |||||||||
Deconsolidation of Trust & Custody Services Bank, Ltd.: | ||||||||||||
Decrease in total assets | — | 8,990,604 | — | |||||||||
of which Cash and cash equivalents | — | 4,943,059 | — | |||||||||
Decrease in total liabilities | — | 8,958,535 | — | |||||||||
of which Due to trust accounts | — | 3,620,825 | — | |||||||||
Noncash assets acquired at fair value in an equity method investee (3) | — | 25,311 | — |
Available-for-sale securities as well as Purchases ofAvailable-for-sale securities include cash activity related to Other investments for the fiscal year ended March 31, 2018, the amounts |
(2) | Proceeds from sales of Equity securities as well as Purchases of Equity securities include cash activity related to Other investments for the fiscal years ended March 31, 2019 and 2020, the amounts of which are not significant. |
(3) | Noncash assets acquired at fair value in an equity method investee was from deconsolidation of Trust & Custody Services Bank, Ltd. |
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE FISCAL YEARS ENDED MARCH 31, 2016, 2017 AND 2018
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | 850,063 | 389,131 | 601,694 | |||||||||
Less: Net income (loss) attributable to noncontrolling interests | (429 | ) | 26,691 | 24,086 | ||||||||
|
|
|
|
|
| |||||||
Net income attributable to MHFG shareholders | 850,492 | 362,440 | 577,608 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||
Depreciation and amortization | 167,930 | 171,202 | 179,158 | |||||||||
Provision (credit) for loan losses | 34,560 | 37,668 | (126,362 | ) | ||||||||
Investment losses (gains)—net | (263,793 | ) | (333,270 | ) | (297,157 | ) | ||||||
Equity in losses (earnings) of equity method investees—net | (28,969 | ) | (26,785 | ) | (24,342 | ) | ||||||
Foreign exchange losses (gains)—net | (225,130 | ) | 22,812 | (251,613 | ) | |||||||
Deferred income tax expense (benefit) | 123,125 | (107,432 | ) | 60,011 | ||||||||
Net change in trading account assets | (778,204 | ) | 4,867,508 | 992,084 | ||||||||
Net change in trading account liabilities | 916,958 | (3,267,060 | ) | (518,339 | ) | |||||||
Net change in loans held for sale | (27,347 | ) | (5,574 | ) | (54,530 | ) | ||||||
Net change in accrued income | (2,441 | ) | 7,087 | (31,842 | ) | |||||||
Net change in accrued expenses | (26,425 | ) | 4,485 | 16,517 | ||||||||
Other—net | (499,046 | ) | (519,773 | ) | (678,854 | ) | ||||||
|
|
|
|
|
| |||||||
Net cash provided by (used in) operating activities | 241,710 | 1,213,308 | (157,661 | ) | ||||||||
|
|
|
|
|
| |||||||
Cash flows from investing activities: | ||||||||||||
Proceeds from sales of investments | 19,830,288 | 31,139,716 | 32,908,551 | |||||||||
Proceeds from maturities of investments | 8,669,730 | 8,099,488 | 15,081,435 | |||||||||
Purchases of investments | (25,046,188 | ) | (34,137,270 | ) | (49,725,626 | ) | ||||||
Proceeds from sales of loans | 197,898 | 291,782 | 296,260 | |||||||||
Net change in loans | (1,923,627 | ) | (5,606,627 | ) | (1,971,210 | ) | ||||||
Net change in interest-bearing deposits in other banks | (7,750,251 | ) | (10,688,447 | ) | (762,722 | ) | ||||||
Net change in call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 385,134 | (1,481,661 | ) | 54,786 | ||||||||
Proceeds from sales of premises and equipment | 47,506 | 12,059 | 22,302 | |||||||||
Purchases of premises and equipment | (388,565 | ) | (430,913 | ) | (292,201 | ) | ||||||
Cash and due from banks acquired in business combination | — | 301 | — | |||||||||
Proceeds from sales of investments in subsidiaries (affecting the scope of consolidation) | — | — | 948 | |||||||||
|
|
|
|
|
| |||||||
Net cash used in investing activities | (5,978,075 | ) | (12,801,572 | ) | (4,387,477 | ) | ||||||
|
|
|
|
|
| |||||||
Cash flows from financing activities: | ||||||||||||
Net change in deposits | 5,441,731 | 14,005,565 | 6,083,800 | |||||||||
Net change in call money and funds purchased, and payables under repurchase agreements and securities lending transactions | (3,900,502 | ) | (771,368 | ) | (67,508 | ) | ||||||
Net change in due to trust accounts | 3,226,204 | (344,217 | ) | (130,544 | ) | |||||||
Net change in other short-term borrowings | 571,901 | (589,512 | ) | 257,774 | ||||||||
Proceeds from issuance of long-term debt | 2,723,168 | 4,496,041 | 1,956,007 | |||||||||
Repayment of long-term debt | (2,307,082 | ) | (4,734,010 | ) | (3,310,804 | ) | ||||||
Proceeds from noncontrolling interests | 1,354 | 3,323 | 76,894 | |||||||||
Payments to noncontrolling interests | (86 | ) | (1,696 | ) | (12,949 | ) | ||||||
Proceeds from issuance of common stock | 5 | 6 | 3 | |||||||||
Proceeds from sales of treasury stock | 3 | 1 | 1 | |||||||||
Purchases of treasury stock | (13 | ) | (1,435 | ) | (1,611 | ) | ||||||
Dividends paid | (195,283 | ) | (190,031 | ) | (190,382 | ) | ||||||
Dividends paid to noncontrolling interests | (2,683 | ) | (2,914 | ) | (8,054 | ) | ||||||
|
|
|
|
|
| |||||||
Net cash provided by financing activities | 5,558,717 | 11,869,753 | 4,652,627 | |||||||||
|
|
|
|
|
| |||||||
Effect of exchange rate changes on cash and due from banks | (28,061 | ) | (11,895 | ) | (13,845 | ) | ||||||
|
|
|
|
|
| |||||||
Net increase (decrease) in cash and due from banks | (205,709 | ) | 269,594 | 93,644 | ||||||||
Cash and due from banks at beginning of fiscal year | 1,528,306 | 1,322,597 | 1,592,191 | |||||||||
|
|
|
|
|
| |||||||
Cash and due from banks at end of fiscal year | 1,322,597 | 1,592,191 | 1,685,835 | |||||||||
|
|
|
|
|
|
See the accompanying Notes to the Consolidated Financial Statements.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS—(Continued)
FOR THE FISCAL YEARS ENDED MARCH 31, 2016, 2017 AND 2018
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Supplemental disclosure of cash flow information: | ||||||||||||
Interest paid | 435,584 | 582,947 | 818,593 | |||||||||
Income taxes paid | 269,364 | 246,802 | 172,891 | |||||||||
Noncash investing activities: | ||||||||||||
Transfer of loans into other investments | 63,420 | — | — | |||||||||
Investment in capital leases | 16,123 | 12,467 | 6,586 | |||||||||
Noncash assets acquired and liabilities assumed at fair value in business combination (Note 3): | ||||||||||||
Noncash assets acquired at fair value | — | 93,049 | — | |||||||||
Noncash liabilities assumed at fair value | — | 25,893 | — |
See the accompanying Notes to the Consolidated Financial Statements.
”
The amounts of asset management business fee income and expenses for the fiscal years ended March 31, 2016 and 2017 have been reclassified from Other noninterest income and Other noninterest expenses to Fee and commission income and Fee and commission expenses, respectively, in order to conform to the current year’s presentation. Such reclassifications had no effect on net income or shareholder’s equity. In addition, certain other
.
cash equivalents
restricted cash.
Equity securities that do not meet the classification of trading securities are measured at fair value with unrealized gains and losses reported in Investment gains (losses)—net Equity securities.
companies.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
included in Trading account assets or Trading account liabilities. Derivatives that do not qualify for hedge accounting under ASC 815 are treated as trading positions and are accounted for as such. The fair value amounts recognized for all derivatives are presented on a gross basis and not offset against the amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral under the master netting agreement with the same counterparty.
The majority of impaired loans have no contractual delinquency due to interest reductions and/or postponement of principal and interest.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
amount is in doubt, otherwise, as interest income. Loans are not restored to accrual status until interest and principal payments are current and future payments are reasonably assured. Impaired loans are restored to54 “Loans” for the definitions of obligor ratings.
The
methodology used for the corporate portfolio segment.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
categories.
Additionally, the allowance for loan losses is adjusted, where appropriate, to reflect significant uncertain economic and business conditions, such as COVID-19 pandemic. For March 31, 2020, the Group has incorporated the estimated impact of COVID-19 pandemic by adjusting its ASC 450 collective allowance; specifically by identifying impacted industries and obligors and adjusted its historical loss formula-based allowance for these loan groups, using assumptions such as anticipated business recovery period and current forecast for the growth rate of gross domestic product.
| ||||
Years | ||||
Buildings | 3 to 50 | |||
Equipment and furniture | 2 to 20 | |||
|
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
or changes in circumstances indicate that its carrying amount may not be recoverable. The estimated fair value of the reporting units is derived based on valuation techniques that the Group believes market participants would use for each of the reporting units. The of benefits, net of investment returns expected from plan assets and their fair values at the balance sheet date. Net periodic expense is charged to Salaries and employee benefits. Net actuarial gains and losses that arise from differences between actual experience and assumptions are generally amortized over the average remaining service period of participating employees if they exceed the corridor, which is defined as the greater of 10% of plan assets or the projected benefit obligation.when triggeringwhenever events occur.amongof asset management companiesfunctions of DIAM Co., Ltd. (“DIAM”), MHTB, Mizuho Asset Management Co., Ltd. (“MHAM”) and Shinko Asset Management Co., Ltd. (“Shinko Asset Management”) consist primarily of customer relationship intangibles, and are amortized over weighted-average amortization periods of 16 years and 16.9 years, respectively. See Note 3 “Business Combination” for further details of the integration among asset management companies. Intangible assets having indefinite useful lives are not amortized and are subject to impairment tests. An impairment loss is recorded to the extent that the carrying amount of the indefinite-lived intangible asset exceeds its estimated fair value. For intangible assets subject to amortization, an impairment loss is recorded if the carrying amount is not recoverable and exceeds its estimated fair value. severance indemnities and pension plans which provide defined benefits to retired employees.employees and other postretirement benefit plans, including severance indemnities. Severance indemnities are amounts payable to eligible employees upon termination of employment and are payable asMIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)Thecost with regard to theprogram for Directors (“Stock Compensation I”) and a performance-based stock compensation program for Directors (“Stock Compensation II”). For both programs, the stock-based compensation cost is determined based uponon the fair value
grant date.
compensation programs.
equity securities without readily determinable fair values.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
liability. The Group maximizes the use of observable inputs and minimizes the use of unobservable inputs when measuring fair value. See Note 2827 “Fair value” for descriptions of valuation methodologies used for its assets and liabilities by product.
Fee
The major components of fee and commission income are as follows.
Recently adopted
In June 2014, the FASB issued ASU No.2014-11, “Transfers and Servicing (Topic 860)—Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures” (“ASU No.2014-11”). The ASU changes the accounting for repurchase-to-maturity transactions to secured borrowing accounting. For repurchase financing arrangements, the ASU requires separate accounting for a transfer of a financial asset executed contemporaneously with a repurchase agreement with the same counterparty, which will result in secured borrowing accounting for the repurchase agreement. The ASU requires disclosures for certain transactions comprising (1) a transfer of a financial asset accounted for as a sale and (2) an agreement with the same transferee entered into in contemplation of the initial transfer that results in the transferor retaining substantially all of the exposure to the economic return on the transferred financial asset throughout the term of the transaction. The ASU also requires an entity to disclose certain information, including risks related to collateral pledged, for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions that are accounted for as secured borrowings. The ASU is effective for the first interim or annual period beginning after December 15, 2014, except for interim disclosure requirements related to secured borrowings, which are
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
effective for interim periods beginning after March 15, 2015.The adoption of ASU No.2014-11 did not have a material impact on the MHFG Group’s consolidated results of operations or financial condition.
In November 2014, the FASB issued ASU No.2014-16, “Derivatives and Hedging (Topic 815)—Determining Whether the Host Contract in a Hybrid Financial Instrument Issued in the Form of a Share Is More Akin to Debt or to Equity” (“ASU No.2014-16”). The ASU clarifies that an entity that issues or invests in a hybrid financial instrument should determine the nature of the host contract by considering the economic characteristics and risks of the entire hybrid financial instrument, including the embedded derivative feature that is being evaluated for bifurcation. The ASU also clarifies that an entity should assess the substance of the relevant terms and features in evaluating the nature of a host contract when considering how to weight those terms and features. Specifically, the assessment of the substance of the relevant terms and features should incorporate a consideration of (1) the characteristics of the terms and features themselves, (2) the circumstances under which the hybrid financial instrument was issued or acquired, and (3) the potential outcomes of the hybrid financial instrument, as well as the likelihood of those potential outcomes. The ASU is effective for fiscal years and interim periods within those fiscal years, beginning after December 15, 2015. The adoption of ASU No.2014-16 did not have a material impact on the MHFG Group’s consolidated results of operations or financial condition.
In February 2015, the FASB issued ASU No.2015-02, “Consolidation (Topic 810)—Amendments to the Consolidation Analysis” (“ASU No.2015-02”). The ASU amends the current accounting for consolidation of certain legal entities. Specifically the amendments: (1) modify the evaluation of whether limited partnerships and similar legal entities are VIEs or voting interest entities, (2) eliminate the presumption that a general partner should consolidate a limited partnership, (3) affect the consolidation analysis of reporting entities that are involved with VIEs, particularly those that have fee arrangements and related party relationships, and (4) provide a scope exception from consolidation guidance for reporting entities with interests in legal entities that are required to comply with or operate in accordance with requirements that are similar to those in Rule 2a-7 of the Investment Company Act of 1940 for registered money market funds. On April 1, 2016, the MHFG Group adopted ASU No.2015-02 using a modified retrospective approach. The adoption of the ASU resulted in a decrease to the beginning balance of Retained earnings of ¥329 million and an increase to the beginning balance of AOCI of ¥330 million, respectively. See Note 25 “Variable interest entities and securitizations” for further information.
In April 2015, the FASB issued ASU No.2015-03, “Interest—Imputation of Interest (Subtopic 835-30)—Simplifying the Presentation of Debt Issuance Costs” (“ASU No.2015-03”). The ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The ASU is effective for financial statements issued for fiscal years beginning after December 15, 2015 and interim periods within those fiscal years, and should be applied retrospectively. The adoption of ASU No.2015-03 did not have a material impact on the MHFG Group’s consolidated results of operations or financial condition.
In May 2015, the FASB issued ASU No.2015-07, “Fair Value Measurement (Topic 820)—Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” (“ASU No.2015-07”). The ASU removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the net asset value per share practical expedient. Rather, those disclosures are limited to investments for which the entity has elected to measure the fair value using that practical expedient. The ASU is effective for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years, and should be applied retrospectively to all periods presented. The adoption of ASU No.2015-07 did not have a material impact on the MHFG Group’s consolidated results of operations or financial condition.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Accounting pronouncements issued but not yet effective
In May 2014, the FASB issued ASU No.2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU No.2014-09”). The ASU, as amended, provides comprehensive guidance in respect of revenue recognition, in convergence with International Financial Reporting Standards (“IFRS”), to improve financial reporting in U.S. GAAP by replacing the current complex guidance for recognizing revenue. The core principle of this ASU is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The ASU is effective for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2017 under a modified retrospective approach or retrospectively to all periods presented. Early application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. The MHFG Group adopted ASU No.2014-09 on April 1, 2018 using the modified retrospective approach. Since there is no material change in timing and amount of revenue or the related cost recognition associated with the adoption, the adoption of ASU No.2014-09 and any subsequent amendments will not have a material impact on the Group’s consolidated results of operations and financial condition. However, beginning prospectively in the fiscal year ending March 31, 2019, the Group’s presentation of certain costs related to securities underwriting will change from a net basis to a gross basis under the new standard. The change in presentation will not have a material impact on the Group’s results of operations. In addition, the Group will expand qualitative and quantitative disclosures pursuant to the new requirements.
In January 2016, the FASB issued ASU
years. Early application is permitted.
March 31, 2020
In October 2016, the FASB issued ASU No.2016-16, “Income Taxes (Topic 740)—Intra-Entity Transfers of Assets Other Than Inventory” (“ASU No.2016-16”). The ASU requires recognition of current and deferred income taxes in an intra-entity transfer of an asset other than inventory when the transfer occurs although current U.S. GAAP has prohibited the recognition of income tax consequences of the transfer until the asset has been sold to an outside party. The ASU does not include new disclosure requirements; however, existing disclosure requirements might be applicable when accounting for the current and deferred income taxes for an intra-entity transfer of an asset other than inventory. The ASU is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, and should be applied using a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption. Early application is permitted for all entities as of the beginning of a fiscal year for which financial statements (interim or annual) have not been issued or made available for issuance. The MHFG Group adopted ASU No.2016-16 on April 1, 2018.2020. The adoption of ASU No. 2016-16 will
In January 2017, the FASB issued ASU No.2017-04, “Intangibles—Goodwill and Other (Topic 350)—Simplifying the Test for Goodwill Impairment” (“ASU No.2017-04”). The ASU eliminates Step 2, under which an entity had to perform procedures to determine the fair value at the impairment testing date
practice and (2) cost and complexity when applying the guidance in Topic 718, Compensation—Stock Compensation, to a change to the terms or conditions of a share-based payment award. The ASU provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting in Topic 718. An entity should account for the effects of a modification unless all the following factors of the award are the same before and after the modification: (1) the fair value, (2) the vesting conditions and (3) the classification as an equity or a liability instrument. The current disclosure requirements in Topic 718 apply regardless of whether an entity is required to apply modification accounting under the ASU. The ASU is effective for all entities for annual periods, and interim periods within those annual periods, beginning after December 15, 2017, and should be applied prospectively to an award modified on or after the adoption date. Early application is permitted, including adoption in any interim period, for reporting periods for which financial statements have not yet been issued. The MHFG Group adopted ASU No.2017-09 on April 1, 2018. The adoption of ASU No. 2017-09 will not have a material impact on the Group’s consolidated results of operations or financial condition.
In August 2017, the FASB issued ASU No.2017-12, “Derivatives and Hedging (Topic 815)—Targeted Improvements to Accounting for Hedging Activities” (“ASU No.2017-12”). The ASU amends the current accounting for derivatives and hedging to enable entities to better portray the economic results of risk management activities in the financial statements. Specifically, the amendments: (1) eliminate the separate measurement and reporting of hedge ineffectiveness, (2) expand the ability to hedge nonfinancial and financial risk components, and (3) provide an alternative method for measuring the hedged item in fair value hedges of interest rate risk. The ASU is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, and should be applied using a cumulative-effect adjustment to the balance sheet as of the beginning of the fiscal year of adoption. Early application is permitted, including adoption in any interim period. The MHFG Group is currently evaluating the potential impact that the adoption of ASU No.2017-12 will have on its consolidated results of operations and financial condition.
In February 2018, the FASB issued ASU No.2018-02, “Income Statement—Reporting Comprehensive Income (Topic 220)—Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (“ASU No.2018-02”). The ASU allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act. The ASU is effective for fiscal years beginning after December 15, 2018, and interim periods within those fiscal years, and should be applied either in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the Tax Cuts and Jobs Act is recognized. Early application is permitted, including adoption in any interim period, for reporting periods for which financial statements have not yet been issued. The MHFG Group does not expect that the adoption of ASU No. 2018-02 will have a material impact on its consolidated results of operations or financial condition.
Integration among asset management companies
On October 1, 2016, DIAM Co., Ltd. (“DIAM”), MHTB, Mizuho Asset Management Co., Ltd. (“MHAM”) Investments
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
As of September 30, 2016, MHAM was a wholly-owned subsidiary of MHFG and DIAM was an equity method affiliate of the MHFG Group which owned 50.0% of the voting equity interests. DIAM was a joint venture of MHFG and Dai-ichi Life Holdings, Inc. (“Dai-ichi Life”, formerly The Dai-ichi Life Insurance Company, Limited), and the rest of the interests of DIAM was owned by Dai-ichi Life. On October 1, 2016, MHFG exchanged 30.0% of the voting equity interests in MHAM (after the split in (ii) above) for voting equity interests and non-voting equity interests in DIAM. As a result of the exchange, MHFG acquired 51.0% of the voting rights and 70.0% of the economic interests in Asset Management One, which became a consolidated subsidiary of the Group.
Based on the strong commitment of MHFG and Dai-ichi Life to strengthen and develop their respective asset management businesses, Asset Management One aims to achieve significant development as a global asset management company, providing its customers with high-quality solutions by combining the asset management-related knowledge and experience accumulated and developed by each of the Integrating Companies over many years, and by taking full advantage of collaboration with both the MHFG Group and the Dai-ichi Life group. The MHFG Group recognized goodwill at the acquisition date. The goodwill was not allocated to the reportable segments in Note 32 “Business segment information”. The MHFG Group allocated the entire amount of the goodwill to the Asset Management One reporting unit for the purpose of assessing impairment. None of the goodwill recognized is deductible for tax purposes.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The following table summarizes the consideration paid for DIAM and the amounts of the acquired assets and assumed liabilities recognized at the acquisition date, as well as the fair value at the acquisition date of the noncontrolling interest in DIAM. There were no material acquisition-related costs that were recognized separately from the acquisition of the assets and the assumption of the liabilities.
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The fair value of the equity interests in DIAM held by MHFG before the business combination (¥72,106 million), the fair value of the 1,038,408 common shares of MHAM as the consideration paid for DIAM (¥28,842 million) and the fair value of the noncontrolling interest in DIAM (¥43,264 million) were determined with reference to an independent third-party appraisal by applying the income approach and the market approach. The income approach was based on the discounted future cash flows of DIAM and MHAM and the market approach was based on market values, earnings and revenues of public companies comparable to DIAM and MHAM. A discount for lack of control was not considered in determining the fair value of the noncontrolling interest, which
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
is entirely held by Dai-Ichi Life, as the economic benefits of DIAM are expected to be divided proportionately between MHFG and Dai-Ichi Life based on their respective economic interests.
On October 1, 2016, the MHFG Group recognized a gain of ¥56,226 million as a result of remeasuring to fair value its 50.0% of the voting equity interests in DIAM held before the business combination. The gain is included in Other noninterest income in the Group’s consolidated statement of income for the fiscal year ended March 31, 2017. In addition, the MHFG Group recognized an increase in Common stock of ¥23,829 million as a result of remeasuring to fair value its 30.0% of the voting equity interests in MHAM held before the business combination due to the change in the voting equity interests in MHAM on October 1, 2016.
The revenue and earnings of Asset Management One since the acquisition date included in the Group’s consolidated statement of income for the fiscal year ended March 31, 2017 are not material. Other than the gain of ¥56,226 million described above, the revenue and earnings of the MHFG Group would not have differed significantly from those reported in the consolidated statements of income for the fiscal years ended March 31, 2016 and 2017 if the business combination had occurred as of the beginning of the fiscal year ended March 31, 2016.
4. Investments
Available-for-sale andheld-to-maturity securities
The amortized cost, gross unrealized gains and losses, and fair value of20172019 and 20182020 are as follows:
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | |||||||||||||
(in millions of yen) | ||||||||||||||||
2017 | ||||||||||||||||
Available-for-sale securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 10,256,512 | 22,782 | 16,408 | 10,262,886 | ||||||||||||
Japanese local government bonds | 279,864 | 4,841 | 233 | 284,472 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 1,148,389 | 10 | 4,578 | 1,143,821 | ||||||||||||
Other foreign government bonds | 933,942 | 1,246 | 236 | 934,952 | ||||||||||||
Agency mortgage-backed securities (1) | 832,738 | 15,500 | 5,441 | 842,797 | ||||||||||||
Residential mortgage-backed securities | 142,879 | 1,838 | 558 | 144,159 | ||||||||||||
Commercial mortgage-backed securities | 223,105 | 1,092 | 282 | 223,915 | ||||||||||||
Japanese corporate bonds and other debt securities (2) | 1,958,472 | 52,046 | 2,286 | 2,008,232 | ||||||||||||
Foreign corporate bonds and other debt securities (3) | 909,052 | 3,377 | 1,643 | 910,786 | ||||||||||||
Equity securities (marketable) | 1,528,808 | 2,273,883 | 1,593 | 3,801,098 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 18,213,761 | 2,376,615 | 33,258 | 20,557,118 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Held-to-maturity securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 3,059,976 | 37,168 | — | 3,097,144 | ||||||||||||
Agency mortgage-backed securities(4) | 757,384 | 121 | 7,931 | 749,574 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 3,817,360 | 37,289 | 7,931 | 3,846,718 | ||||||||||||
|
|
|
|
|
|
|
|
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | |||||||||||||
(in millions of yen) | ||||||||||||||||
2019 | ||||||||||||||||
Available-for-sale securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 11,888,510 | 11,259 | 2,998 | 11,896,771 | ||||||||||||
Japanese local government bonds | 208,308 | 1,671 | 87 | 209,892 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 1,008,903 | 644 | 231 | 1,009,316 | ||||||||||||
Other foreign government bonds | 1,341,564 | 758 | 455 | 1,341,867 | ||||||||||||
Agency mortgage-backed securities (1) | 530,540 | 14,524 | 593 | 544,471 | ||||||||||||
Residential mortgage-backed securities | 99,904 | 1,420 | 191 | 101,133 | ||||||||||||
Commercial mortgage-backed securities | 495,313 | 4,914 | 104 | 500,123 | ||||||||||||
Japanese corporate bonds and other debt securities | 1,743,309 | 7,686 | 1,561 | 1,749,434 | ||||||||||||
Foreign corporate bonds and other debt securities (2) | 778,088 | 3,047 | 226 | 780,909 | ||||||||||||
Total | 18,094,439 | 45,923 | 6,446 | 18,133,916 | ||||||||||||
Held-to-maturity securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 1,119,899 | 19,907 | — | 1,139,806 | ||||||||||||
Agency mortgage-backed securities (3) | 484,205 | — | 14,423 | 469,782 | ||||||||||||
Total | 1,604,104 | 19,907 | 14,423 | 1,609,588 | ||||||||||||
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | |||||||||||||
(in millions of yen) | ||||||||||||||||
2020 | ||||||||||||||||
Available-for-sale securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 12,651,677 | 1,319 | 50,224 | 12,602,772 | ||||||||||||
Japanese local government bonds | 272,412 | 649 | 494 | 272,567 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 927,172 | 7,733 | — | 934,905 | ||||||||||||
Other foreign government bonds | 1,408,009 | 3,273 | 202 | 1,411,080 | ||||||||||||
Agency mortgage-backed securities (1) | 494,958 | 10,490 | 434 | 505,014 | ||||||||||||
Residential mortgage-backed securities | 83,077 | 1,405 | �� | 151 | 84,331 | |||||||||||
Commercial mortgage-backed securities | 609,559 | 5,551 | 106 | 615,004 | ||||||||||||
Japanese corporate bonds and other debt securities | 1,836,540 | 7,489 | 8,772 | 1,835,257 | ||||||||||||
Foreign corporate bonds and other debt securities (2) | 849,595 | 2,595 | 168 | 852,022 | ||||||||||||
Total | 19,132,999 | 40,504 | 60,551 | 19,112,952 | ||||||||||||
Held-to-maturity securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 479,936 | 13,357 | — | 493,293 | ||||||||||||
Agency mortgage-backed securities (3) | 382,095 | 1,245 | 1,303 | 382,037 | ||||||||||||
Total | 862,031 | 14,602 | 1,303 | 875,330 | ||||||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Amortized cost | Gross unrealized gains | Gross unrealized losses | Fair value | |||||||||||||
(in millions of yen) | ||||||||||||||||
2018 | ||||||||||||||||
Available-for-sale securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 13,334,619 | 7,332 | 9,656 | 13,332,295 | ||||||||||||
Japanese local government bonds | 236,711 | 2,903 | 280 | 239,334 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 689,297 | 109 | 3,557 | 685,849 | ||||||||||||
Other foreign government bonds | 1,057,852 | 1,043 | 1,102 | 1,057,793 | ||||||||||||
Agency mortgage-backed securities (1) | 882,686 | 13,356 | 7,628 | 888,414 | ||||||||||||
Residential mortgage-backed securities | 117,870 | 1,264 | 281 | 118,853 | ||||||||||||
Commercial mortgage-backed securities | 437,115 | 4,132 | 323 | 440,924 | ||||||||||||
Japanese corporate bonds and other debt securities (2) | 1,950,947 | 40,290 | 1,410 | 1,989,827 | ||||||||||||
Foreign corporate bonds and other debt securities (3) | 879,506 | 1,927 | 2,082 | 879,351 | ||||||||||||
Equity securities (marketable) | 1,595,106 | 2,449,173 | 11,291 | 4,032,988 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 21,181,709 | 2,521,529 | 37,610 | 23,665,628 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Held-to-maturity securities: | ||||||||||||||||
Debt securities: | ||||||||||||||||
Japanese government bonds | 1,959,910 | 24,472 | — | 1,984,382 | ||||||||||||
Agency mortgage-backed securities(4) | 557,641 | — | 20,177 | 537,464 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 2,517,551 | 24,472 | 20,177 | 2,521,846 | ||||||||||||
|
|
|
|
|
|
|
|
Notes :
(1) | Agency mortgage-backed securities presented in this line consist of Japanese and Foreign agency mortgage-backed securities, of which the fair values were |
(2) | Other debt securities presented in this line primarily consist of Foreign negotiable certificates of deposit (“ |
All Agency mortgage-backed securities presented in this line are Ginnie Mae securities. |
Amortized cost | Due in one year or less | Due after one year through five years | Due after five years through ten years | Due after ten years | Total | |||||||||||||||
(in millions of yen) | ||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 5,872,058 | 4,980,539 | 1,753,300 | 45,780 | 12,651,677 | |||||||||||||||
Japanese local government bonds | 11,530 | 171,825 | 84,528 | 4,529 | 272,412 | |||||||||||||||
U.S. Treasury bonds and federal agency securities | 883,432 | 43,740 | — | — | 927,172 | |||||||||||||||
Other foreign government bonds | 1,029,641 | 378,368 | — | — | 1,408,009 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 494,958 | 494,958 | |||||||||||||||
Residential mortgage-backed securities | — | — | — | 83,077 | 83,077 | |||||||||||||||
Commercial mortgage-backed securities | 16,372 | 202,044 | 390,343 | 800 | 609,559 | |||||||||||||||
Japanese corporate bonds and other debt securities | 98,532 | 868,704 | 545,320 | 323,984 | 1,836,540 | |||||||||||||||
Foreign corporate bonds and other debt securities | 377,642 | 327,312 | 141,755 | 2,886 | 849,595 | |||||||||||||||
Total | 8,289,207 | 6,972,532 | 2,915,246 | 956,014 | 19,132,999 | |||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | — | 479,936 | — | — | 479,936 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 382,095 | 382,095 | |||||||||||||||
Total | — | 479,936 | — | 382,095 | 862,031 | |||||||||||||||
Fair value | Due in one year or less | Due after one year through five years | Due after five years through ten years | Due after ten years | Total | |||||||||||||||
(in millions of yen) | ||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 5,872,485 | 4,963,282 | 1,722,090 | 44,915 | 12,602,772 | |||||||||||||||
Japanese local government bonds | 11,537 | 172,052 | 84,443 | 4,535 | 272,567 | |||||||||||||||
U.S. Treasury bonds and federal agency securities | 890,367 | 44,538 | — | — | 934,905 | |||||||||||||||
Other foreign government bonds | 1,031,189 | 379,891 | — | — | 1,411,080 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 505,014 | 505,014 | |||||||||||||||
Residential mortgage-backed securities | — | — | — | 84,331 | 84,331 | |||||||||||||||
Commercial mortgage-backed securities | 16,396 | 203,233 | 394,561 | 814 | 615,004 | |||||||||||||||
Japanese corporate bonds and other debt securities | 98,589 | 868,675 | 544,559 | 323,434 | 1,835,257 | |||||||||||||||
Foreign corporate bonds and other debt securities | 378,464 | 328,918 | 141,754 | 2,886 | 852,022 | |||||||||||||||
Total | 8,299,027 | 6,960,589 | 2,887,407 | 965,929 | 19,112,952 | |||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | — | 493,293 | — | — | 493,293 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 382,037 | 382,037 | |||||||||||||||
Total | — | 493,293 | — | 382,037 | 875,330 | |||||||||||||||
Amortized cost | Due in one year or less | Due after one year through five years | Due after five years through ten years | Due after ten years | Total | |||||||||||||||
(in millions of yen) | ||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 6,288,570 | 5,024,258 | 1,922,141 | 99,650 | 13,334,619 | |||||||||||||||
Japanese local government bonds | 31,962 | 118,445 | 81,541 | 4,763 | 236,711 | |||||||||||||||
U.S. Treasury bonds and federal agency securities | 610,995 | — | 78,302 | — | 689,297 | |||||||||||||||
Other foreign government bonds | 842,041 | 207,604 | 8,207 | — | 1,057,852 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 882,686 | 882,686 | |||||||||||||||
Residential mortgage-backed securities | — | — | — | 117,870 | 117,870 | |||||||||||||||
Commercial mortgage-backed securities | 858 | 137,409 | 224,548 | 74,300 | 437,115 | |||||||||||||||
Japanese corporate bonds and other debt securities | 312,046 | 1,067,186 | 409,419 | 162,296 | 1,950,947 | |||||||||||||||
Foreign corporate bonds and other debt securities | 503,309 | 312,257 | 60,998 | 2,942 | 879,506 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 8,589,781 | 6,867,159 | 2,785,156 | 1,344,507 | 19,586,603 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Held-to-maturity securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 840,030 | 740,103 | 379,777 | — | 1,959,910 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 557,641 | 557,641 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 840,030 | 740,103 | 379,777 | 557,641 | 2,517,551 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
Fair value | Due in one year or less | Due after one year through five years | Due after five years through ten years | Due after ten years | Total | |||||||||||||||
(in millions of yen) | ||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 6,286,075 | 5,026,020 | 1,920,660 | 99,540 | 13,332,295 | |||||||||||||||
Japanese local government bonds | 32,020 | 119,496 | 82,991 | 4,827 | 239,334 | |||||||||||||||
U.S. Treasury bonds and federal agency securities | 610,406 | — | 75,443 | — | 685,849 | |||||||||||||||
Other foreign government bonds | 842,068 | 207,593 | 8,132 | — | 1,057,793 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 888,414 | 888,414 | |||||||||||||||
Residential mortgage-backed securities | — | — | — | 118,853 | 118,853 | |||||||||||||||
Commercial mortgage-backed securities | 859 | 137,554 | 227,413 | 75,098 | 440,924 | |||||||||||||||
Japanese corporate bonds and other debt securities | 312,303 | 1,102,032 | 411,127 | 164,365 | 1,989,827 | |||||||||||||||
Foreign corporate bonds and other debt securities | 503,219 | 312,047 | 61,172 | 2,913 | 879,351 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 8,586,950 | 6,904,742 | 2,786,938 | 1,354,010 | 19,632,640 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Held-to-maturity securities: | ||||||||||||||||||||
Debt securities: | ||||||||||||||||||||
Japanese government bonds | 841,850 | 746,088 | 396,444 | — | 1,984,382 | |||||||||||||||
Agency mortgage-backed securities | — | — | — | 537,464 | 537,464 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 841,850 | 746,088 | 396,444 | 537,464 | 2,521,846 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
recognized immediately through earnings. In other cases, the MHFG Group evaluates expected cash flows to be received and determines if a credit loss exists, and if so, the amount of an other-than-temporary impairment related to the credit loss is recognized in earnings, while the remaining decline in fair value is recognized in other comprehensive income, net of applicable taxes. ForEffective April 1, 2018, the
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Available-for-sale securities: | ||||||||||||
Debt securities | 4,020 | 138 | 1,015 | |||||||||
Equity securities | 34,041 | 12,029 | 3,080 | |||||||||
|
|
|
|
|
| |||||||
Total | 38,061 | 12,167 | 4,095 | |||||||||
|
|
|
|
|
|
For the fiscal year ended March 31, 2018, the other-than-temporary impairment losses on debt securities were attributable to the decline in the fair value
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||
Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
2017 | ||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Japanese government bonds | 5,574,649 | 15,796 | 95,612 | 612 | 5,670,261 | 16,408 | ||||||||||||||||||
Japanese local government bonds | 58,700 | 233 | — | — | 58,700 | 233 | ||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 1,013,962 | 4,578 | — | — | 1,013,962 | 4,578 | ||||||||||||||||||
Other foreign government bonds | 334,300 | 230 | 8,327 | 6 | 342,627 | 236 | ||||||||||||||||||
Agency mortgage-backed securities (1) | 195,887 | 3,705 | 42,501 | 1,736 | 238,388 | 5,441 | ||||||||||||||||||
Residential mortgage-backed securities | 5,873 | 3 | 28,994 | 555 | 34,867 | 558 | ||||||||||||||||||
Commercial mortgage-backed securities | 8,314 | 218 | 17,634 | 64 | 25,948 | 282 | ||||||||||||||||||
Japanese corporate bonds and other debt securities | 470,602 | 2,062 | 158,713 | 224 | 629,315 | 2,286 | ||||||||||||||||||
Foreign corporate bonds and other debt securities | 202,347 | 1,353 | 77,699 | 290 | 280,046 | 1,643 | ||||||||||||||||||
Equity securities (marketable) | 30,688 | 383 | 4,117 | 1,210 | 34,805 | 1,593 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 7,895,322 | 28,561 | 433,597 | 4,697 | 8,328,919 | 33,258 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Agency mortgage-backed securities (2) | 460,882 | 3,518 | 259,466 | 4,413 | 720,348 | 7,931 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 460,882 | 3,518 | 259,466 | 4,413 | 720,348 | 7,931 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
2018 | ||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Japanese government bonds | 8,052,820 | 3,716 | 2,868,078 | 5,940 | 10,920,898 | 9,656 | ||||||||||||||||||
Japanese local government bonds | 28,827 | 139 | 58,998 | 141 | 87,825 | 280 | ||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 515,005 | 3,557 | — | — | 515,005 | 3,557 | ||||||||||||||||||
Other foreign government bonds | 419,648 | 1,030 | 68,359 | 72 | 488,007 | 1,102 | ||||||||||||||||||
Agency mortgage-backed securities (1) | 45,434 | 1,116 | 188,326 | 6,512 | 233,760 | 7,628 | ||||||||||||||||||
Residential mortgage-backed securities | 11,336 | 14 | 16,129 | 267 | 27,465 | 281 | ||||||||||||||||||
Commercial mortgage-backed securities | 68,723 | 242 | 7,835 | 81 | 76,558 | 323 | ||||||||||||||||||
Japanese corporate bonds and other debt securities | 563,831 | 933 | 403,069 | 477 | 966,900 | 1,410 | ||||||||||||||||||
Foreign corporate bonds and other debt securities | 358,410 | 888 | 87,472 | 1,194 | 445,882 | 2,082 | ||||||||||||||||||
Equity securities (marketable) | 338,243 | 11,249 | 366 | 42 | 338,609 | 11,291 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 10,402,277 | 22,884 | 3,698,632 | 14,726 | 14,100,909 | 37,610 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Agency mortgage-backed securities (2) | 30,589 | 766 | 506,875 | 19,411 | 537,464 | 20,177 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 30,589 | 766 | 506,875 | 19,411 | 537,464 | 20,177 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Less than 12 months | 12 months or more | Total | ||||||||||||||||||||||
Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | Fair value | Gross unrealized losses | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Japanese government bonds | 2,296,536 | 1,441 | 1,332,688 | 1,557 | 3,629,224 | 2,998 | ||||||||||||||||||
Japanese local government bonds | 9,752 | 32 | 38,873 | 55 | 48,625 | 87 | ||||||||||||||||||
U.S. Treasury bonds and federal agency securities | 506,176 | 231 | — | — | 506,176 | 231 | ||||||||||||||||||
Other foreign government bonds | 438,771 | 321 | 26,782 | 134 | 465,553 | 455 | ||||||||||||||||||
Agency mortgage-backed securities (1) | 466 | 2 | 37,706 | 591 | 38,172 | 593 | ||||||||||||||||||
Residential mortgage-backed securities | — | — | 16,729 | 191 | 16,729 | 191 | ||||||||||||||||||
Commercial mortgage-backed securities | 11,256 | 44 | 36,760 | 60 | 48,016 | 104 | ||||||||||||||||||
Japanese corporate bonds and other debt securities | 417,825 | 924 | 440,937 | 637 | 858,762 | 1,561 | ||||||||||||||||||
Foreign corporate bonds and other debt securities | 129,164 | 142 | 79,716 | 84 | 208,880 | 226 | ||||||||||||||||||
Total | 3,809,946 | 3,137 | 2,010,191 | 3,309 | 5,820,137 | 6,446 | ||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Agency mortgage-backed securities (2) | — | — | 469,782 | 14,423 | 469,782 | 14,423 | ||||||||||||||||||
Total | — | — | 469,782 | 14,423 | 469,782 | 14,423 | ||||||||||||||||||
2020 | ||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Japanese government bonds | 10,339,320 | 43,204 | 283,561 | 7,020 | 10,622,881 | 50,224 | ||||||||||||||||||
Japanese local government bonds | 162,665 | 418 | 34,114 | 76 | 196,779 | 494 | ||||||||||||||||||
U.S. Treasury bonds and federal agency securities | — | — | — | — | — | — | ||||||||||||||||||
Other foreign government bonds | 196,990 | 202 | — | — | 196,990 | 202 | ||||||||||||||||||
Agency mortgage-backed securities (1) | 30,913 | 227 | 9,504 | 207 | 40,417 | 434 | ||||||||||||||||||
Residential mortgage-backed securities | 9,524 | 62 | 5,450 | 89 | 14,974 | 151 | ||||||||||||||||||
Commercial mortgage-backed securities | 15,115 | 85 | 7,478 | 21 | 22,593 | 106 | ||||||||||||||||||
Japanese corporate bonds and other debt securities | 669,572 | 5,507 | 608,361 | 3,265 | 1,277,933 | 8,772 | ||||||||||||||||||
Foreign corporate bonds and other debt securities | 152,058 | 165 | 5,564 | 3 | 157,622 | 168 | ||||||||||||||||||
Total | 11,576,157 | 49,870 | 954,032 | 10,681 | 12,530,189 | 60,551 | ||||||||||||||||||
Held-to-maturity securities: | ||||||||||||||||||||||||
Debt securities: | ||||||||||||||||||||||||
Agency mortgage-backed securities (2) | — | — | 191,244 | 1,303 | 191,244 | 1,303 | ||||||||||||||||||
Total | — | — | 191,244 | 1,303 | 191,244 | 1,303 | ||||||||||||||||||
(1) | Agency mortgage-backed securities presented in this line consist of Japanese and Foreign agency mortgage-backed securities, of which the fair values were |
(2) | All Agency mortgage-backed securities presented in this line are Ginnie Mae securities. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The equity securities in an unrealized loss position were determined not to be other-than-temporarily impaired based on the evaluation of the following factors: (1) the severity and duration of the impairments, (2) the financial condition and near-term prospects of the issuers, and (3) the MHFG Group’s ability and intent to hold these investments for a reasonable period of time sufficient for a forecasted recovery of fair value.
2018 | 2019 (Note) | 2020 (Note) | ||||||||||
(in millions of yen) | ||||||||||||
Gross realized gains | 314,948 | 23,777 | 41,903 | |||||||||
Gross realized losses | (41,044 | ) | (26,299 | ) | (13,398 | ) | ||||||
Net realized gains (losses) on sales of available-for-sale securities | 273,904 | (2,522 | ) | 28,505 | ||||||||
Note: | Effective April 1, 2018, the available-for-sale category was eliminated for equity securities, and gains and losses on these securities are not included for the fiscal years ended March 31, 2019 and 2020 columns in this table. See Note 2 “Issued accounting pronouncements” for further details. |
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Net gains (losses) recognized during the period on equity securities | (155,947 | ) | (557,391 | ) | ||||
Less: Net gains (losses) recognized during the period on equity securities sold during the period | 34,034 | 1,710 | ||||||
Unrealized gains (losses) recognized during the reporting period on equity securities still held at the reporting period | (189,981 | ) | (559,101 | ) | ||||
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Carrying amounts at the end of the period | 212,270 | 419,775 | ||||||
Downward adjustments and impairments | 1,413 | 2,435 | ||||||
Upward adjustments | 2,373 | 9,128 |
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Downward adjustments and impairments | 1,413 | 1,272 | ||||||
Upward adjustments | 2,373 | 6,928 |
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Gross realized gains | 297,344 | 353,036 | 314,948 | |||||||||
Gross realized losses | (45,376 | ) | (21,163 | ) | (41,044 | ) | ||||||
|
|
|
|
|
| |||||||
Net realized gains (losses) on sales ofavailable-for-sale securities | 251,968 | 331,873 | 273,904 | |||||||||
|
|
|
|
|
|
the same issuer. In addition, the MHFG Group assesses whether these equity securities are impaired. Impairment is primarily based on a liquidation value technique that considers the financial condition, credit ratings, and near-term prospects of the issuers. When observable price changes or impairments exist, the securities are adjusted to fair value, with the full difference between the fair value of the security and its carrying amount recognized in earnings.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Equity method investments | 249,679 | 280,666 | ||||||
Investments held by consolidated investment companies | 37,462 | 37,735 | ||||||
Other equity interests | 307,928 | 267,495 | ||||||
|
|
|
| |||||
Total | 595,069 | 585,896 | ||||||
|
|
|
|
2020:
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Equity method investments | 354,268 | 404,513 | ||||||
Investments held by consolidated investment companies | 35,472 | 39,438 | ||||||
Total | 389,740 | 443,951 | ||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The majority of the aggregate market values of these marketable equity securities are related toinclude Orient Corporation, the Chiba Kogyo Bank, Ltd.
2020. In addition, equity method investments include
Other equity interests
Other equity interests primarily consist ofnon-marketable equity securities outside the scope
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Domestic: | ||||||||
Manufacturing | 8,740,097 | 8,156,341 | ||||||
Construction and real estate | 7,772,006 | 8,101,668 | ||||||
Services | 4,748,974 | 5,024,018 | ||||||
Wholesale and retail | 5,140,202 | 5,112,673 | ||||||
Transportation and communications | 3,490,378 | 3,564,869 | ||||||
Banks and other financial institutions | 4,006,387 | 4,471,423 | ||||||
Government and public institutions | 8,532,246 | 8,882,125 | ||||||
Other industries(Note) | 4,426,233 | 5,018,387 | ||||||
Individuals: | ||||||||
Mortgage loans | 9,960,176 | 9,445,286 | ||||||
Other | 839,841 | 883,724 | ||||||
|
|
|
| |||||
Total domestic | 57,656,540 | 58,660,514 | ||||||
|
|
|
| |||||
Foreign: | ||||||||
Commercial and industrial | 16,872,448 | 17,095,604 | ||||||
Banks and other financial institutions | 6,759,921 | 6,739,846 | ||||||
Government and public institutions | 959,948 | 1,127,740 | ||||||
Other | 190,724 | 37,636 | ||||||
|
|
|
| |||||
Total foreign | 24,783,041 | 25,000,826 | ||||||
|
|
|
| |||||
Total | 82,439,581 | 83,661,340 | ||||||
Less: Unearned income and deferred loan fees—net | 155,675 | 146,696 | ||||||
|
|
|
| |||||
Total loans before allowance for loan losses | 82,283,906 | 83,514,644 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Domestic: | ||||||||
Manufacturing | 9,553,854 | 9,731,028 | ||||||
Construction and real estate | 8,950,577 | 9,603,433 | ||||||
Services | 5,016,971 | 5,992,511 | ||||||
Wholesale and retail | 5,159,356 | 5,219,727 | ||||||
Transportation and communications | 3,693,491 | 3,832,884 | ||||||
Banks and other financial institutions | 4,345,589 | 4,634,442 | ||||||
Government and public institutions | 2,358,904 | 2,198,805 | ||||||
Other industries (Note) | 5,472,597 | 5,389,347 | ||||||
Individuals: | ||||||||
Mortgage loans | 8,950,216 | 8,567,099 | ||||||
Other | 907,589 | 861,235 | ||||||
Total domestic | 54,409,144 | 56,030,511 | ||||||
Foreign: | ||||||||
Commercial and industrial | 19,126,182 | 20,818,709 | ||||||
Banks and other financial institutions | 9,086,721 | 10,475,277 | ||||||
Government and public institutions | 296,872 | 317,284 | ||||||
Other | 33,171 | 35,388 | ||||||
Total foreign | 28,542,946 | 31,646,658 | ||||||
Total | 82,952,090 | 87,677,169 | ||||||
Less: Unearned income and deferred loan fees—net | 152,147 | 149,081 | ||||||
Total loans before allowance for loan losses | 82,799,943 | 87,528,088 | ||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note: | Other industries of d omestic includes trade receivables and lease receivables of consolidated VIEs. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
|
| |||||
| ||||||
Obligor category (1)(2) | Obligor rating (3) | Definition | ||||
Normal | A | Obligors whose certainty of debt fulfillment is very high, hence their level of credit risk is very low. | ||||
B | Obligors whose certainty of debt fulfillment poses no problems for the foreseeable future, and their level of credit risk is low. | |||||
C | Obligors whose certainty of debt fulfillment and their level of credit risk pose no problems for the foreseeable future. | |||||
D | Obligors whose current certainty of debt fulfillment poses no problems, however, their resistance to future economic environmental changes is low. | |||||
| ||||||
Watch | E1 | Obligors that require observation going forward because of either minor concerns regarding their financial position, or their somewhat weak or unstable business conditions. | ||||
E2 | Obligors that require special observation going forward because of problems with their borrowings such as reduced or suspended interest payments, problems with debt fulfillment such as failure to make principal or interest payments, or problems with their financial position as a result of their weak or unstable business conditions. | |||||
| ||||||
Intensive control | F | Obligors that are not yet bankrupt but are in financial difficulties and are deemed likely to become bankrupt in the future because of insufficient progress in implementing their management improvement plans or other measures (including obligors that are receiving ongoing support from financial institutions). | ||||
| ||||||
Substantially bankrupt | G | Obligors that have not yet become legally or formally bankrupt but are substantially insolvent because they are in serious financial difficulties and are deemed to be incapable of being restructured. | ||||
| ||||||
Bankrupt | H | Obligors that have become legally or formally bankrupt. |
(1) | Special attention obligors are watch obligors with debt in TDR or 90 days or more delinquent debt. Loans to such obligors are considered impaired. |
(2) | The Group classifies loans to special attention, intensive control, substantially bankrupt and bankrupt obligors as impaired loans. |
(3) | Equivalent obligor ratings are determined for the other portfolio segment. |
Normal obligors | Watch obligors excluding special attention obligors (1) | Impaired loans | Total | |||||||||||||||||||||||||||||
Corporate | Retail (2) | Other (3) | Corporate | Retail (2) | Other (3) | |||||||||||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||||||||||
2017 | ||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||
Manufacturing | 7,912,872 | 90,761 | 67,734 | 276,771 | 11,589 | 1,314 | 379,056 | 8,740,097 | ||||||||||||||||||||||||
Construction and real estate | 6,926,963 | 586,984 | 15,585 | 168,619 | 16,062 | 317 | 57,476 | 7,772,006 | ||||||||||||||||||||||||
Services | 4,381,342 | 181,525 | 910 | 95,434 | 23,189 | 204 | 66,370 | 4,748,974 | ||||||||||||||||||||||||
Wholesale and retail | 4,612,668 | 199,590 | 22,785 | 124,846 | 32,911 | 501 | 146,901 | 5,140,202 | ||||||||||||||||||||||||
Transportation and communications | 3,324,148 | 82,506 | 1,092 | 50,319 | 9,698 | — | 22,615 | 3,490,378 | ||||||||||||||||||||||||
Banks and other financial institutions | 3,938,132 | 1,880 | 37,907 | 21,574 | 353 | — | 6,541 | 4,006,387 | ||||||||||||||||||||||||
Government and public institutions | 4,060,949 | — | 4,471,297 | — | — | — | — | 8,532,246 | ||||||||||||||||||||||||
Other industries(4) | 2,463,390 | 3,275 | 1,906,756 | 4,613 | 410 | 41,179 | 6,610 | 4,426,233 | ||||||||||||||||||||||||
Individuals | 211,328 | 10,288,916 | 80,566 | 24,044 | 89,027 | 1,434 | 104,702 | 10,800,017 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total domestic | 37,831,792 | 11,435,437 | 6,604,632 | 766,220 | 183,239 | 44,949 | 790,271 | 57,656,540 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||
Commercial and industrial | 14,125,338 | 173 | 2,153,757 | 312,275 | — | 90,722 | 190,183 | 16,872,448 | ||||||||||||||||||||||||
Banks and other financial institutions | 6,220,767 | — | 480,806 | 58,348 | — | — | — | 6,759,921 | ||||||||||||||||||||||||
Government and public institutions | 956,036 | — | 1,082 | 2,801 | — | — | 29 | 959,948 | ||||||||||||||||||||||||
Other | 6,535 | 9,439 | 173,464 | 124 | 8 | 753 | 401 | 190,724 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total foreign | 21,308,676 | 9,612 | 2,809,109 | 373,548 | 8 | 91,475 | 190,613 | 24,783,041 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total | 59,140,468 | 11,445,049 | 9,413,741 | 1,139,768 | 183,247 | 136,424 | 980,884 | 82,439,581 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
2018 | ||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||
Manufacturing | 7,705,495 | 77,947 | 23,343 | 197,465 | 9,775 | 246 | 142,070 | 8,156,341 | ||||||||||||||||||||||||
Construction and real estate | 7,317,972 | 541,778 | 13,332 | 172,287 | 15,466 | — | 40,833 | 8,101,668 | ||||||||||||||||||||||||
Services | 4,535,793 | 172,045 | 141,718 | 95,223 | 21,109 | 55 | 58,075 | 5,024,018 | ||||||||||||||||||||||||
Wholesale and retail | 4,636,236 | 177,965 | 17,305 | 121,832 | 27,975 | 476 | 130,884 | 5,112,673 | ||||||||||||||||||||||||
Transportation and communications | 3,414,781 | 76,532 | 1,774 | 35,339 | 8,916 | — | 27,527 | 3,564,869 | ||||||||||||||||||||||||
Banks and other financial institutions | 4,244,101 | 1,640 | 196,431 | 16,716 | 194 | — | 12,341 | 4,471,423 | ||||||||||||||||||||||||
Government and public institutions | 3,010,708 | — | 5,871,417 | — | — | — | — | 8,882,125 | ||||||||||||||||||||||||
Other industries(4) | 2,716,502 | 3,536 | 2,170,442 | 2,708 | 259 | 121,201 | 3,739 | 5,018,387 | ||||||||||||||||||||||||
Individuals | 222,410 | 9,822,244 | 88,044 | 23,491 | 81,550 | 1,109 | 90,162 | 10,329,010 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total domestic | 37,803,998 | 10,873,687 | 8,523,806 | 665,061 | 165,244 | 123,087 | 505,631 | 58,660,514 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||
Commercial and industrial | 14,093,375 | 209 | 2,432,189 | 398,231 | — | 64,950 | 106,650 | 17,095,604 | ||||||||||||||||||||||||
Banks and other financial institutions | 6,223,742 | — | 487,978 | 28,126 | — | — | — | 6,739,846 | ||||||||||||||||||||||||
Government and public institutions | 1,125,921 | — | — | — | — | — | 1,819 | 1,127,740 | ||||||||||||||||||||||||
Other | 1,906 | 9,245 | 23,730 | 242 | 6 | 1,347 | 1,160 | 37,636 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total foreign | 21,444,944 | 9,454 | 2,943,897 | 426,599 | 6 | 66,297 | 109,629 | 25,000,826 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||
Total | 59,248,942 | 10,883,141 | 11,467,703 | 1,091,660 | 165,250 | 189,384 | 615,260 | 83,661,340 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Normal obligors | Watch obligors excluding special attention obligors (1) | Impaired loans | Total | |||||||||||||||||||||||||||||
Corporate | Retail (2) | Other (3) | Corporate | Retail (2) | Other (3) | |||||||||||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||
Manufacturing | 9,205,542 | 69,080 | 19,805 | 141,202 | 8,278 | 1,303 | 108,644 | 9,553,854 | ||||||||||||||||||||||||
Construction and real estate | 8,182,062 | 505,142 | 15,920 | 186,753 | 14,490 | 25 | 46,185 | 8,950,577 | ||||||||||||||||||||||||
Services | 4,665,709 | 165,643 | 3,281 | 90,178 | 18,586 | 1 | 73,573 | 5,016,971 | ||||||||||||||||||||||||
Wholesale and retail | 4,682,630 | 161,392 | 26,881 | 127,695 | 25,553 | 591 | 134,614 | 5,159,356 | ||||||||||||||||||||||||
Transportation and communications | 3,543,952 | 71,934 | 934 | 37,993 | 7,472 | — | 31,206 | 3,693,491 | ||||||||||||||||||||||||
Banks and other financial institutions | 4,304,483 | 1,534 | 72 | 28,881 | 319 | — | 10,300 | 4,345,589 | ||||||||||||||||||||||||
Government and public institutions | 2,358,899 | 5 | — | — | — | — | — | 2,358,904 | ||||||||||||||||||||||||
Other industries (4) | 3,126,217 | 2,450 | 2,323,197 | 7,725 | 421 | 3,633 | 8,954 | 5,472,597 | ||||||||||||||||||||||||
Individuals | 233,986 | 9,384,955 | 64,974 | 21,127 | 70,427 | 1,168 | 81,168 | 9,857,805 | ||||||||||||||||||||||||
Total domestic | 40,303,480 | 10,362,135 | 2,455,064 | 641,554 | 145,546 | 6,721 | 494,644 | 54,409,144 | ||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||
Commercial and industrial | 16,101,326 | 182 | 2,488,800 | 347,060 | — | 38,404 | 150,410 | 19,126,182 | ||||||||||||||||||||||||
Banks and other financial institutions | 8,583,432 | — | 492,831 | 10,458 | — | — | — | 9,086,721 | ||||||||||||||||||||||||
Government and public institutions | 296,870 | — | — | — | — | — | 2 | 296,872 | ||||||||||||||||||||||||
Other | 1,480 | 9,713 | 19,690 | 333 | — | 879 | 1,076 | 33,171 | ||||||||||||||||||||||||
Total foreign | 24,983,108 | 9,895 | 3,001,321 | 357,851 | — | 39,283 | 151,488 | 28,542,946 | ||||||||||||||||||||||||
Total | 65,286,588 | 10,372,030 | 5,456,385 | 999,405 | 145,546 | 46,004 | 646,132 | 82,952,090 | ||||||||||||||||||||||||
2020 | ||||||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||||||
Manufacturing | 9,007,095 | 62,921 | 17,445 | 475,983 | 7,474 | 684 | 159,426 | 9,731,028 | ||||||||||||||||||||||||
Construction and real estate | 8,849,784 | 473,339 | 12,710 | 201,384 | 10,928 | — | 55,288 | 9,603,433 | ||||||||||||||||||||||||
Services | 5,600,528 | 159,657 | 2,943 | 131,783 | 16,602 | 15 | 80,983 | 5,992,511 | ||||||||||||||||||||||||
Wholesale and retail | 4,766,460 | 145,568 | 17,156 | 119,778 | 22,363 | 873 | 147,529 | 5,219,727 | ||||||||||||||||||||||||
Transportation and communications | 3,692,025 | 65,535 | 395 | 44,250 | 7,664 | 303 | 22,712 | 3,832,884 | ||||||||||||||||||||||||
Banks and other financial institutions | 4,595,441 | 1,593 | 347 | 24,686 | 429 | — | 11,946 | 4,634,442 | ||||||||||||||||||||||||
Government and public institutions | 2,198,796 | 9 | — | — | — | — | — | 2,198,805 | ||||||||||||||||||||||||
Other industries (4) | 3,106,282 | 2,684 | 2,230,748 | 15,238 | 372 | 15,038 | 18,985 | 5,389,347 | ||||||||||||||||||||||||
Individuals | 208,832 | 8,989,113 | 63,185 | 20,990 | 60,128 | 2,279 | 83,807 | 9,428,334 | ||||||||||||||||||||||||
Total domestic | 42,025,243 | 9,900,419 | 2,344,929 | 1,034,092 | 125,960 | 19,192 | 580,676 | 56,030,511 | ||||||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||||||
Commercial and industrial | 17,806,263 | 284 | 2,526,317 | 314,273 | — | 36,593 | 134,979 | 20,818,709 | ||||||||||||||||||||||||
Banks and other financial institutions | 9,745,247 | — | 726,823 | 3,207 | — | — | — | 10,475,277 | ||||||||||||||||||||||||
Government and public institutions | 303,393 | — | 13,129 | 762 | — | — | — | 317,284 | ||||||||||||||||||||||||
Other | 1,333 | 10,406 | 20,558 | 1,684 | 15 | 843 | 549 | 35,388 | ||||||||||||||||||||||||
Total foreign (5) | 27,856,236 | 10,690 | 3,286,827 | 319,926 | 15 | 37,436 | 135,528 | 31,646,658 | ||||||||||||||||||||||||
Total | 69,881,479 | 9,911,109 | 5,631,756 | 1,354,018 | 125,975 | 56,628 | 716,204 | 87,677,169 | ||||||||||||||||||||||||
(1) | Special attention obligors are watch obligors with debt in TDR or 90 days or more delinquent debt. Loans to such obligors are considered impaired. |
(2) |
(3) | Non-impaired loans held by subsidiaries other than MHBK and MHTB constitute |
(4) | Other industries of |
(5) Impaired loans to foreign borrowers decreased by ¥15,960 million due mainly to the sale of certain loans, partly offset by deterioration of credit status of certain other borrowers.
Recorded investment (1) | Unpaid principal balance | Related allowance (3) | Average recorded investment | Interest income recognized (4) | ||||||||||||||||||||||||
Requiring an allowance for loan losses | Not requiring an allowance for loan losses(2) | Total | ||||||||||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||||||
2017 | ||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||
Manufacturing | 372,241 | 6,815 | 379,056 | 383,812 | 148,777 | 375,895 | 2,859 | |||||||||||||||||||||
Construction and real estate | 46,130 | 11,346 | 57,476 | 66,006 | 6,367 | 66,796 | 877 | |||||||||||||||||||||
Services | 58,366 | 8,004 | 66,370 | 72,261 | 20,122 | 66,050 | 1,173 | |||||||||||||||||||||
Wholesale and retail | 133,466 | 13,435 | 146,901 | 155,023 | 52,341 | 148,865 | 2,261 | |||||||||||||||||||||
Transportation and communications | 19,386 | 3,229 | 22,615 | 23,568 | 5,968 | 24,035 | 371 | |||||||||||||||||||||
Banks and other financial institutions | 2,601 | 3,940 | 6,541 | 6,873 | 962 | 5,305 | 50 | |||||||||||||||||||||
Other industries | 6,484 | 126 | 6,610 | 6,740 | 1,999 | 6,053 | 91 | |||||||||||||||||||||
Individuals | 51,893 | 52,809 | 104,702 | 114,880 | 4,935 | 114,104 | 1,696 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total domestic | 690,567 | 99,704 | 790,271 | 829,163 | 241,471 | 807,103 | 9,378 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Foreign: | ||||||||||||||||||||||||||||
Total foreign (5) | 160,563 | 30,050 | 190,613 | 209,129 | 61,102 | 169,192 | 2,040 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | 851,130 | 129,754 | 980,884 | 1,038,292 | 302,573 | 976,295 | 11,418 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
2018 | ||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||
Manufacturing | 135,083 | 6,987 | 142,070 | 146,857 | 45,750 | 218,899 | 1,869 | |||||||||||||||||||||
Construction and real estate | 31,557 | 9,276 | 40,833 | 48,752 | 4,411 | 49,926 | 516 | |||||||||||||||||||||
Services | 48,691 | 9,384 | 58,075 | 64,348 | 13,305 | 60,198 | 919 | |||||||||||||||||||||
Wholesale and retail | 119,463 | 11,421 | 130,884 | 139,556 | 42,798 | 139,333 | 1,842 | |||||||||||||||||||||
Transportation and communications | 25,019 | 2,508 | 27,527 | 28,480 | 6,862 | 25,672 | 370 | |||||||||||||||||||||
Banks and other financial institutions | 8,392 | 3,949 | 12,341 | 12,341 | 3,176 | 8,648 | 78 | |||||||||||||||||||||
Other industries | 3,650 | 89 | 3,739 | 3,869 | 3,563 | 4,537 | 53 | |||||||||||||||||||||
Individuals | 43,326 | 46,836 | 90,162 | 95,338 | 4,315 | 97,404 | 1,402 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total domestic | 415,181 | 90,450 | 505,631 | 539,541 | 124,180 | 604,617 | 7,049 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Foreign: | ||||||||||||||||||||||||||||
Total foreign (5) | 63,346 | 46,283 | 109,629 | 125,329 | 28,333 | 151,588 | 1,042 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | 478,527 | 136,733 | 615,260 | 664,870 | 152,513 | 756,205 | 8,091 | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2020:
Recorded investment (1) | Unpaid principal balance | Related allowance (3) | Average recorded investment | Interest income recognized (4) | ||||||||||||||||||||||||
Requiring an allowance for loan losses | Not requiring an allowance for loan losses (2) | Total | ||||||||||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||
Manufacturing | 103,039 | 5,605 | 108,644 | 111,533 | 39,301 | 122,764 | 1,404 | |||||||||||||||||||||
Construction and real estate | 36,873 | 9,312 | 46,185 | 51,158 | 4,661 | 42,224 | 487 | |||||||||||||||||||||
Services | 64,021 | 9,552 | 73,573 | 79,736 | 16,311 | 67,679 | 1,058 | |||||||||||||||||||||
Wholesale and retail | 124,911 | 9,703 | 134,614 | 147,665 | 38,763 | 130,860 | 1,814 | |||||||||||||||||||||
Transportation and communications | 28,297 | 2,909 | 31,206 | 32,139 | 13,146 | 29,864 | 412 | |||||||||||||||||||||
Banks and other financial institutions | 6,473 | 3,827 | 10,300 | 10,300 | 1,327 | 10,671 | 109 | |||||||||||||||||||||
Other industries | 8,867 | 87 | 8,954 | 9,149 | 5,761 | 6,042 | 29 | |||||||||||||||||||||
Individuals | 37,488 | 43,680 | 81,168 | 88,331 | 2,630 | 86,082 | 1,326 | |||||||||||||||||||||
Total domestic | 409,969 | 84,675 | 494,644 | 530,011 | 121,900 | 496,186 | 6,639 | |||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||
Total foreign (5) | 119,079 | 32,409 | 151,488 | 164,984 | 47,345 | 113,559 | 1,518 | |||||||||||||||||||||
Total | 529,048 | 117,084 | 646,132 | 694,995 | 169,245 | 609,745 | 8,157 | |||||||||||||||||||||
2020 | ||||||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||||||
Manufacturing | 152,865 | 6,561 | 159,426 | 162,742 | 62,879 | 139,123 | 2,292 | |||||||||||||||||||||
Construction and real estate | 47,413 | 7,875 | 55,288 | 62,064 | 8,366 | 50,343 | 593 | |||||||||||||||||||||
Services | 71,358 | 9,625 | 80,983 | 85,565 | 20,117 | 78,583 | 973 | |||||||||||||||||||||
Wholesale and retail | 139,338 | 8,191 | 147,529 | 158,933 | 48,582 | 139,042 | 1,845 | |||||||||||||||||||||
Transportation and communications | 20,203 | 2,509 | 22,712 | 23,555 | 7,318 | 25,549 | 383 | |||||||||||||||||||||
Banks and other financial institutions | 8,193 | 3,753 | 11,946 | 11,946 | 1,541 | 10,565 | 129 | |||||||||||||||||||||
Other industries | 18,709 | 276 | 18,985 | 20,716 | 8,606 | 14,512 | 194 | |||||||||||||||||||||
Individuals | 42,632 | 41,175 | 83,807 | 88,315 | 6,382 | 82,456 | 1,253 | |||||||||||||||||||||
Total domestic | 500,711 | 79,965 | 580,676 | 613,836 | 163,791 | 540,173 | 7,662 | |||||||||||||||||||||
Foreign: | ||||||||||||||||||||||||||||
Total foreign (5) | 95,289 | 40,239 | 135,528 | 151,212 | 67,235 | 123,313 | 3,032 | |||||||||||||||||||||
Total | 596,000 | 120,204 | 716,204 | 765,048 | 231,026 | 663,486 | 10,694 | |||||||||||||||||||||
(1) | Amounts represent the outstanding balances of nonaccrual loans. The MHFG Group’s policy for placing loans in nonaccrual status corresponds to the Group’s definition of impaired loans. |
(2) | These impaired loans do not require an allowance for loan losses because the MHFG Group has sufficient collateral to cover probable loan losses. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(3) | The allowance for loan losses on impaired loans includes the allowance for groups of loans which were collectively evaluated for impairment, in addition to the allowance for those loans that were individually evaluated for impairment. The total carrying amount of the groups of loans which were collectively evaluated for impairment at March 31, |
(4) | Amounts represent the amount of interest income on impaired loans recognized on a cash basis and included in Interest income on loans in the consolidated statements of income. |
(5) | The majority of |
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Loan forgiveness or debt to equity swaps | Interest rate reduction and/or postponement of principal and/or interest | |||||||||||
Recorded investment (1) | Charge-offs | |||||||||||
(in millions of yen) | ||||||||||||
2019 | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | — | — | 134,544 | |||||||||
Construction and real estate | — | — | 39,254 | |||||||||
Services | — | — | 87,468 | |||||||||
Wholesale and retail | — | — | 167,299 | |||||||||
Transportation and communications | — | — | 33,991 | |||||||||
Banks and other financial institutions | — | — | 17,286 | |||||||||
Other industries | — | — | 120 | |||||||||
Individuals | — | — | 42,330 | |||||||||
Total domestic | — | — | 522,292 | |||||||||
Foreign: | �� | |||||||||||
Total foreign (2) | 984 | 1,964 | 44,033 | |||||||||
Total | 984 | 1,964 | 566,325 | |||||||||
2020 | ||||||||||||
Domestic: | ||||||||||||
Manufacturing | 689 | 3,806 | 148,564 | |||||||||
Construction and real estate | — | — | 31,803 | |||||||||
Services | — | — | 78,211 | |||||||||
Wholesale and retail | — | 196 | 169,224 | |||||||||
Transportation and communications | — | — | 18,700 | |||||||||
Banks and other financial institutions | — | — | 16,962 | |||||||||
Other industries | — | — | 1,366 | |||||||||
Individuals | — | — | 14,000 | |||||||||
Total domestic | 689 | 4,002 | 478,830 | |||||||||
Foreign: | ||||||||||||
Total foreign (2) | 466 | 4,906 | 114,159 | |||||||||
Total | 1,155 | 8,908 | 592,989 | |||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(1) | Amounts represent the book values of loans immediately after the restructurings. |
(2) | The majority of |
Recorded investment | ||||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Domestic: | ||||||||
Manufacturing | 5,164 | 4,019 | ||||||
Construction and real estate | 2,887 | 80 | ||||||
Services | 4,471 | 4,469 | ||||||
Wholesale and retail | 10,116 | 25,710 | ||||||
Transportation and communications | 795 | 264 | ||||||
Other industries | 14 | 130 | ||||||
Individuals | 2,288 | 1,819 | ||||||
|
|
|
| |||||
Total domestic | 25,735 | 36,491 | ||||||
|
|
|
| |||||
Foreign: | ||||||||
Total foreign | 3,213 | 4,588 | ||||||
|
|
|
| |||||
Total | 28,948 | 41,079 | ||||||
|
|
|
|
Recorded investment | ||||||||
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Domestic: | ||||||||
Manufacturing | 1,173 | 3,752 | ||||||
Construction and real estate | 121 | 345 | ||||||
Services | 1,335 | 3,822 | ||||||
Wholesale and retail | 15,087 | 19,018 | ||||||
Transportation and communications | 878 | 824 | ||||||
Banks and other financial institutions | 66 | 66 | ||||||
Other industries | 1,650 | — | ||||||
Individuals | 2,152 | 2,545 | ||||||
Total domestic | 22,462 | 30,372 | ||||||
Foreign: | ||||||||
Total foreign | 5,418 | 11,442 | ||||||
Total | 27,880 | 41,814 | ||||||
30-59 days past due | 60-89 days past due | 90 days or more past due | Total past due | Current | Total | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
2017 | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | 1,938 | 360 | 7,767 | 10,065 | 8,730,032 | 8,740,097 | ||||||||||||||||||
Construction and real estate | 3,061 | 947 | 32,523 | 36,531 | 7,735,475 | 7,772,006 | ||||||||||||||||||
Services | 917 | 217 | 5,914 | 7,048 | 4,741,926 | 4,748,974 | ||||||||||||||||||
Wholesale and retail | 1,330 | 2,834 | 5,585 | 9,749 | 5,130,453 | 5,140,202 | ||||||||||||||||||
Transportation and communications | 384 | 322 | 1,859 | 2,565 | 3,487,813 | 3,490,378 | ||||||||||||||||||
Banks and other financial institutions | — | — | — | — | 4,006,387 | 4,006,387 | ||||||||||||||||||
Government and public institutions | — | — | — | — | 8,532,246 | 8,532,246 | ||||||||||||||||||
Other industries | — | — | 69 | 69 | 4,426,164 | 4,426,233 | ||||||||||||||||||
Individuals | 32,752 | 12,291 | 34,846 | 79,889 | 10,720,128 | 10,800,017 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total domestic | 40,382 | 16,971 | 88,563 | 145,916 | 57,510,624 | 57,656,540 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Foreign: | ||||||||||||||||||||||||
Total foreign(Note) | 546 | 216 | 95,719 | 96,481 | 24,686,560 | 24,783,041 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 40,928 | 17,187 | 184,282 | 242,397 | 82,197,184 | 82,439,581 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
2018 | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | 585 | 470 | 8,037 | 9,092 | 8,147,249 | 8,156,341 | ||||||||||||||||||
Construction and real estate | 1,641 | 474 | 28,633 | 30,748 | 8,070,920 | 8,101,668 | ||||||||||||||||||
Services | 1,977 | 1,142 | 5,051 | 8,170 | 5,015,848 | 5,024,018 | ||||||||||||||||||
Wholesale and retail | 1,704 | 1,083 | 6,639 | 9,426 | 5,103,247 | 5,112,673 | ||||||||||||||||||
Transportation and communications | 356 | 639 | 1,828 | 2,823 | 3,562,046 | 3,564,869 | ||||||||||||||||||
Banks and other financial institutions | — | 1,301 | — | 1,301 | 4,470,122 | 4,471,423 | ||||||||||||||||||
Government and public institutions | — | — | — | — | 8,882,125 | 8,882,125 | ||||||||||||||||||
Other industries | 33 | 12 | 37 | 82 | 5,018,305 | 5,018,387 | ||||||||||||||||||
Individuals | 31,566 | 12,426 | 31,444 | 75,436 | 10,253,574 | 10,329,010 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total domestic | 37,862 | 17,547 | 81,669 | 137,078 | 58,523,436 | 58,660,514 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Foreign: | ||||||||||||||||||||||||
Total foreign(Note) | 897 | 450 | 41,316 | 42,663 | 24,958,163 | 25,000,826 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 38,759 | 17,997 | 122,985 | 179,741 | 83,481,599 | 83,661,340 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
30-59 dayspast due | 60-89 dayspast due | 90 days or more past due | Total past due | Current | Total | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | 2,210 | 513 | 7,036 | 9,759 | 9,544,095 | 9,553,854 | ||||||||||||||||||
Construction and real estate | 1,010 | 1,054 | 31,092 | 33,156 | 8,917,421 | 8,950,577 | ||||||||||||||||||
Services | 633 | 196 | 3,494 | 4,323 | 5,012,648 | 5,016,971 | ||||||||||||||||||
Wholesale and retail | 1,614 | 1,415 | 7,868 | 10,897 | 5,148,459 | 5,159,356 | ||||||||||||||||||
Transportation and communications | 363 | 256 | 2,119 | 2,738 | 3,690,753 | 3,693,491 | ||||||||||||||||||
Banks and other financial institutions | 3 | 484 | 6 | 493 | 4,345,096 | 4,345,589 | ||||||||||||||||||
Government and public institutions | — | — | — | — | 2,358,904 | 2,358,904 | ||||||||||||||||||
Other industries | 2 | — | 57 | 59 | 5,472,538 | 5,472,597 | ||||||||||||||||||
Individuals | 27,139 | 11,013 | 28,965 | 67,117 | 9,790,688 | 9,857,805 | ||||||||||||||||||
Total domestic | 32,974 | 14,931 | 80,637 | 128,542 | 54,280,602 | 54,409,144 | ||||||||||||||||||
Foreign: | ||||||||||||||||||||||||
Total foreign (Note) | 668 | 211 | 26,316 | 27,195 | 28,515,751 | 28,542,946 | ||||||||||||||||||
Total | 33,642 | 15,142 | 106,953 | 155,737 | 82,796,353 | 82,952,090 | ||||||||||||||||||
2020 | ||||||||||||||||||||||||
Domestic: | ||||||||||||||||||||||||
Manufacturing | 1,109 | 386 | 10,997 | 12,492 | 9,718,536 | 9,731,028 | ||||||||||||||||||
Construction and real estate | 1,266 | 687 | 21,518 | 23,471 | 9,579,962 | 9,603,433 | ||||||||||||||||||
Services | 792 | 548 | 6,714 | 8,054 | 5,984,457 | 5,992,511 | ||||||||||||||||||
Wholesale and retail | 1,748 | 2,446 | 11,972 | 16,166 | 5,203,561 | 5,219,727 | ||||||||||||||||||
Transportation and communications | 56 | 35 | 2,051 | 2,142 | 3,830,742 | 3,832,884 | ||||||||||||||||||
Banks and other financial institutions | — | — | 109 | 109 | 4,634,333 | 4,634,442 | ||||||||||||||||||
Government and public institutions | — | — | — | — | 2,198,805 | 2,198,805 | ||||||||||||||||||
Other industries | 28 | 20 | 1,326 | 1,374 | 5,387,973 | 5,389,347 | ||||||||||||||||||
Individuals | 21,376 | 10,876 | 34,793 | 67,045 | 9,361,289 | 9,428,334 | ||||||||||||||||||
Total domestic | 26,375 | 14,998 | 89,480 | 130,853 | 55,899,658 | 56,030,511 | ||||||||||||||||||
Foreign: | ||||||||||||||||||||||||
Total foreign (Note) | 1,214 | 181 | 28,722 | 30,117 | 31,616,541 | 31,646,658 | ||||||||||||||||||
Total | 27,589 | 15,179 | 118,202 | 160,970 | 87,516,199 | 87,677,169 | ||||||||||||||||||
Note: | The majority of |
6.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
loans such as those used for working capital and capital expenditure, as well as loans for which the primary source of repayment of the obligation is income generated by the relevant assets such
Corporate | Retail | Other | Total | |||||||||||||
(in millions of yen) | ||||||||||||||||
2016 | ||||||||||||||||
Balance at beginning of fiscal year | 423,177 | 60,469 | 36,613 | 520,259 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Provision (credit) for loan losses | 33,532 | (15,474 | ) | 16,502 | 34,560 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Charge-offs | (97,536 | ) | (2,173 | ) | (12,610 | ) | (112,319 | ) | ||||||||
Recoveries | 17,232 | 1,399 | 2,034 | 20,665 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net charge-offs | (80,304 | ) | (774 | ) | (10,576 | ) | (91,654 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Others(Note) | (8,666 | ) | — | (3,252 | ) | (11,918 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Balance at end of fiscal year | 367,739 | 44,221 | 39,287 | 451,247 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
2017 | ||||||||||||||||
Balance at beginning of fiscal year | 367,739 | 44,221 | 39,287 | 451,247 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Provision (credit) for loan losses | 45,059 | (10,666 | ) | 3,275 | 37,668 | |||||||||||
|
|
|
|
|
|
|
| |||||||||
Charge-offs | (22,901 | ) | (1,754 | ) | (6,597 | ) | (31,252 | ) | ||||||||
Recoveries | 18,320 | 5,122 | 2,158 | 25,600 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net charge-offs | (4,581 | ) | 3,368 | (4,439 | ) | (5,652 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Others(Note) | (890 | ) | — | (2,700 | ) | (3,590 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Balance at end of fiscal year | 407,327 | 36,923 | 35,423 | 479,673 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
2018 | ||||||||||||||||
Balance at beginning of fiscal year | 407,327 | 36,923 | 35,423 | 479,673 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Provision (credit) for loan losses | (123,470 | ) | (7,427 | ) | 4,535 | (126,362 | ) | |||||||||
|
|
|
|
|
|
|
| |||||||||
Charge-offs | (44,621 | ) | (2,118 | ) | (9,123 | ) | (55,862 | ) | ||||||||
Recoveries | 12,924 | 814 | 1,482 | 15,220 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Net charge-offs | (31,697 | ) | (1,304 | ) | (7,641 | ) | (40,642 | ) | ||||||||
|
|
|
|
|
|
|
| |||||||||
Others(Note) | (3,088 | ) | — | 321 | (2,767 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Balance at end of fiscal year | 249,072 | 28,192 | 32,638 | 309,902 | ||||||||||||
|
|
|
|
|
|
|
|
Corporate | Retail | Other | Total | |||||||||||||
(in millions of yen) | ||||||||||||||||
2018 | ||||||||||||||||
Balance at beginning of fiscal year | 407,327 | 36,923 | 35,423 | 479,673 | ||||||||||||
Provision (credit) for loan losses | (123,470 | ) | (7,427 | ) | 4,535 | (126,362 | ) | |||||||||
Charge-offs | (44,621 | ) | (2,118 | ) | (9,123 | ) | (55,862 | ) | ||||||||
Recoveries | 12,924 | 814 | 1,482 | 15,220 | ||||||||||||
Net charge-offs | (31,697 | ) | (1,304 | ) | (7,641 | ) | (40,642 | ) | ||||||||
Others (Note) | (3,088 | ) | — | 321 | (2,767 | ) | ||||||||||
Balance at end of fiscal year | 249,072 | 28,192 | 32,638 | 309,902 | ||||||||||||
2019 | ||||||||||||||||
Balance at beginning of fiscal year | 249,072 | 28,192 | 32,638 | 309,902 | ||||||||||||
Provision (credit) for loan losses | 31,693 | (2,658 | ) | 3,424 | 32,459 | |||||||||||
Charge-offs | (39,728 | ) | (2,856 | ) | (4,940 | ) | (47,524 | ) | ||||||||
Recoveries | 11,019 | 552 | 2,532 | 14,103 | ||||||||||||
Net charge-offs | (28,709 | ) | (2,304 | ) | (2,408 | ) | (33,421 | ) | ||||||||
Others (Note) | 847 | — | (2,586 | ) | (1,739 | ) | ||||||||||
Balance at end of fiscal year | 252,903 | 23,230 | 31,068 | 307,201 | ||||||||||||
2020 | ||||||||||||||||
Balance at beginning of fiscal year | 252,903 | 23,230 | 31,068 | 307,201 | ||||||||||||
Provision (credit) for loan losses | 155,576 | 760 | (136 | ) | 156,200 | |||||||||||
Charge-offs | (33,971 | ) | (3,840 | ) | (6,547 | ) | (44,358 | ) | ||||||||
Recoveries | 26,155 | 700 | 1,061 | 27,916 | ||||||||||||
Net charge-offs | (7,816 | ) | (3,140 | ) | (5,486 | ) | (16,442 | ) | ||||||||
Others (Note) | (5,454 | ) | — | (650 | ) | (6,104 | ) | |||||||||
Balance at end of fiscal year | 395,209 | 20,850 | 24,796 | 440,855 | ||||||||||||
Note: | Others includes primarily foreign exchange translation. |
Corporate | Retail | Other | Total | |||||||||||||
(in millions of yen) | ||||||||||||||||
2017 | ||||||||||||||||
Allowance for loan losses | 407,327 | 36,923 | 35,423 | 479,673 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
of which individually evaluated for impairment | 272,714 | 2,922 | 13,306 | 288,942 | ||||||||||||
of which collectively evaluated for impairment | 134,613 | 34,001 | 22,117 | 190,731 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Loans(Note) | 61,120,654 | 11,722,726 | 9,596,201 | 82,439,581 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
of which individually evaluated for impairment | 772,647 | 23,422 | 65,075 | 861,144 | ||||||||||||
of which collectively evaluated for impairment | 60,348,007 | 11,699,304 | 9,531,126 | 81,578,437 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
2018 | ||||||||||||||||
Allowance for loan losses | 249,072 | 28,192 | 32,638 | 309,902 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
of which individually evaluated for impairment | 129,789 | 2,602 | 7,383 | 139,774 | ||||||||||||
of which collectively evaluated for impairment | 119,283 | 25,590 | 25,255 | 170,128 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Loans(Note) | 60,837,559 | 11,133,862 | 11,689,919 | 83,661,340 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
of which individually evaluated for impairment | 593,053 | 21,364 | 61,023 | 675,440 | ||||||||||||
of which collectively evaluated for impairment | 60,244,506 | 11,112,498 | 11,628,896 | 82,985,900 | ||||||||||||
|
|
|
|
|
|
|
|
Corporate | Retail | Other | Total | |||||||||||||
(in millions of yen) | ||||||||||||||||
2019 | ||||||||||||||||
Allowance for loan losses | 252,903 | 23,230 | 31,068 | 307,201 | ||||||||||||
of which individually evaluated for impairment | 139,472 | 2,122 | 8,933 | 150,527 | ||||||||||||
of which collectively evaluated for impairment | 113,431 | 21,108 | 22,135 | 156,674 | ||||||||||||
�� | ||||||||||||||||
Loans (Note) | 66,804,088 | 10,596,994 | 5,551,008 | 82,952,090 | ||||||||||||
of which individually evaluated for impairment | 539,893 | 20,886 | 54,319 | 615,098 | ||||||||||||
of which collectively evaluated for impairment | 66,264,195 | 10,576,108 | 5,496,689 | 82,336,992 | ||||||||||||
2020 | ||||||||||||||||
Allowance for loan losses | 395,209 | 20,850 | 24,796 | 440,855 | ||||||||||||
of which individually evaluated for impairment | 231,941 | 1,704 | 5,443 | 239,088 | ||||||||||||
of which collectively evaluated for impairment | 163,268 | 19,146 | 19,353 | 201,767 | ||||||||||||
Loans (Note) | 71,840,922 | 10,112,617 | 5,723,630 | 87,677,169 | ||||||||||||
of which individually evaluated for impairment | 971,153 | 19,279 | 44,244 | 1,034,676 | ||||||||||||
of which collectively evaluated for impairment | 70,869,769 | 10,093,338 | 5,679,386 | 86,642,493 | ||||||||||||
Note: | Amounts represent loan balances before deducting unearned income and deferred loan fees. |
7.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Land | 575,054 | 566,040 | ||||||
Buildings | 807,312 | 811,911 | ||||||
Equipment and furniture | 485,407 | 484,102 | ||||||
Leasehold improvements | 93,967 | 97,066 | ||||||
Construction in progress | 23,093 | 25,849 | ||||||
Software | 1,308,292 | 1,463,786 | ||||||
|
|
|
| |||||
Total | 3,293,125 | 3,448,754 | ||||||
Less: Accumulated depreciation and amortization | 1,251,852 | 1,332,570 | ||||||
|
|
|
| |||||
Premises and equipment—net | 2,041,273 | 2,116,184 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Land | 563,032 | 557,943 | ||||||
Buildings | 826,781 | 657,774 | ||||||
Equipment and furniture | 472,186 | 442,302 | ||||||
Leasehold improvements | 97,508 | 228,383 | ||||||
Construction in progress | 37,174 | 73,164 | ||||||
Software | 1,366,481 | 1,359,120 | ||||||
Total | 3,363,162 | 3,318,686 | ||||||
Less: Accumulated depreciation and amortization | 1,462,210 | 1,462,438 | ||||||
Premises and equipment—net | 1,900,952 | 1,856,248 | ||||||
Premises and equipment under capital leases, which is primarily comprised of data processing equipment, amounted to ¥80,430 million and ¥83,734 million at March 31, 2017 and 2018, respectively. Accumulated
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
depreciation and amortization on such premises and equipment at March 31, 2017 and 2018 amounted to ¥40,155 million and ¥42,158 million, respectively.
8.
2016 | 2017 | 2018 |
| |||||||||||||
(in millions of yen) | ||||||||||||||||
Balance at beginning of fiscal year | 11,703 | 19,097 | 95,176 | |||||||||||||
Goodwill acquired | 16,470 | (1) | 76,225 | (2) | — | |||||||||||
Impairment losses recognized | (6,222 | ) | — | — | ||||||||||||
Foreign exchange translation | (2,854 | ) | (146 | ) | 8 | |||||||||||
Balance at end of fiscal year | 19,097 | 95,176 | 95,184 | |||||||||||||
|
|
|
|
|
|
|
| |||||||||
Gross amount of goodwill(3) | 94,473 | 171,432 | 170,926 | |||||||||||||
Accumulated impairment losses | 75,376 | 76,256 | 75,742 |
Notes:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Balance at beginning of fiscal year | 95,176 | 95,184 | 95,151 | |||||||||
Impairment losses recognized | — | — | (2,155 | ) | ||||||||
Foreign exchange translation | 8 | (33 | ) | 1 | ||||||||
Balance at end of fiscal year | 95,184 | 95,151 | 92,997 | |||||||||
Gross amount of goodwill (Note) | 170,926 | 169,489 | 169,313 | |||||||||
Accumulated impairment losses | 75,742 | 74,338 | 76,316 |
Goodwill is recorded at a designated reporting unit level for the purpose of assessing impairment. Goodwill is not allocated to the reportable segments in Note |
Due to the prolonged severe business environment for Banco Mizuho do Brasil S.A., it was determined that the carrying amount of the Banco Mizuho do Brasil S.A. reporting unit exceeded its fair value, which is based on the market approach. Therefore, a goodwill impairment loss of ¥6,222 million was recognized during the fiscal year ended March 31, 2016.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2017 | 2018 | |||||||||||||||||||||||
Gross carrying amount | Accumulated amortization | Net carrying amount | Gross carrying amount | Accumulated amortization | Net carrying amount | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
Intangible assets subject to amortization: | ||||||||||||||||||||||||
Customer relationships (Note) | 126,979 | 42,517 | 84,462 | 126,979 | 52,237 | 74,742 | ||||||||||||||||||
Other | 2,814 | 2,190 | 624 | 1,847 | 1,341 | 506 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 129,793 | 44,707 | 85,086 | 128,826 | 53,578 | 75,248 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Intangible assets not subject to amortization: | ||||||||||||||||||||||||
Total | 9,061 | — | 9,061 | 9,199 | — | 9,199 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 138,854 | 44,707 | 94,147 | 138,025 | 53,578 | 84,447 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
2019 | 2020 | |||||||||||||||||||||||
Gross carrying amount | Accumulated amortization | Net carrying amount | Gross carrying amount | Accumulated amortization | Net carrying amount | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
Intangible assets subject to amortization: | ||||||||||||||||||||||||
Customer relationships (Note) | 126,882 | 61,630 | 65,252 | 126,979 | 70,904 | 56,075 | ||||||||||||||||||
Other | 1,698 | 1,412 | 286 | 1,693 | 1,460 | 233 | ||||||||||||||||||
Total | 128,580 | 63,042 | 65,538 | 128,672 | 72,364 | 56,308 | ||||||||||||||||||
Intangible assets not subject to amortization: | ||||||||||||||||||||||||
Total | 8,702 | — | 8,702 | 8,381 | — | 8,381 | ||||||||||||||||||
Total | 137,282 | 63,042 | 74,240 | 137,053 | 72,364 | 64,689 | ||||||||||||||||||
Note: | Customer relationships were acquired in connection with the merger of MHSC and Shinko on May 7, 2009 and the integration among asset management companies on October 1, |
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2019 | 9,288 | |||
2020 | 8,950 | |||
2021 | 8,230 | |||
2022 | 7,697 | |||
2023 | 7,180 |
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2021 | 8,237 | |||
2022 | 7,702 | |||
2023 | 7,184 | |||
2024 | 6,666 | |||
2025 | 6,154 |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
9.
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
Interest-bearing deposits in other banks | 51 | 37 | ||||||
Trading account assets | 6,577 | 5,611 | ||||||
Investments | 8,213 | 6,500 | ||||||
Loans | 7,468 | 5,229 | ||||||
Other assets | 1,588 | 2,099 | ||||||
|
|
|
| |||||
Total | 23,897 | 19,476 | ||||||
|
|
|
|
2020:
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Interest-bearing deposits in other banks | 68 | 69 | ||||||
Trading account assets | 4,137 | 5,705 | ||||||
Investments | 6,076 | 4,155 | ||||||
Loans | 4,055 | 3,887 | ||||||
Other assets | 1,886 | 2,786 | ||||||
Total | 16,222 | 16,602 | ||||||
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
Deposits | 919 | 256 | ||||||
Payables under repurchase agreements | 6,109 | 5,518 | ||||||
Payables under securities lending transactions | 1,460 | 1,193 | ||||||
Other short-term borrowings | 686 | 441 | ||||||
Long-term debt | 4,220 | 3,179 | ||||||
|
|
|
| |||||
Total | 13,394 | 10,587 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Deposits | 386 | 1,057 | ||||||
Payables under repurchase agreements | 3,435 | 5,480 | ||||||
Payables under securities lending transactions | 1,675 | 1,094 | ||||||
Other short-term borrowings | 519 | 4,014 | ||||||
Long-term debt | 1,431 | 213 | ||||||
Total | 7,446 | 11,858 | ||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
10.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Domestic offices: | ||||||||
Time deposits | 17,763,052 | 17,194,707 | ||||||
Certificates of deposit | 5,877,100 | 5,778,430 | ||||||
|
|
|
| |||||
Total | 23,640,152 | 22,973,137 | ||||||
|
|
|
| |||||
Foreign offices: | ||||||||
Time deposits | 14,862,230 | 13,426,554 | ||||||
Certificates of deposit | 4,754,170 | 5,604,160 | ||||||
|
|
|
| |||||
Total | 19,616,400 | 19,030,714 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Domestic offices: | ||||||||
Time deposits | 16,578,642 | 14,684,619 | ||||||
Certificates of deposit | 5,643,303 | 7,558,770 | ||||||
Total | 22,221,945 | 22,243,389 | ||||||
Foreign offices: | ||||||||
Time deposits | 17,606,520 | 18,008,751 | ||||||
Certificates of deposit | 7,695,240 | 5,723,792 | ||||||
Total | 25,301,760 | 23,732,543 | ||||||
Time deposits | Certificates of deposit | Total | ||||||||||
(in millions of yen) | ||||||||||||
Domestic offices: | ||||||||||||
Due in one year or less | 22,363,333 | 5,658,280 | 28,021,613 | |||||||||
Due after one year through two years | 1,635,033 | 120,150 | 1,755,183 | |||||||||
Due after two years through three years | 1,282,400 | — | 1,282,400 | |||||||||
Due after three years through four years | 328,518 | — | 328,518 | |||||||||
Due after four years through five years | 361,730 | — | 361,730 | |||||||||
Due after five years | 122,211 | — | 122,211 | |||||||||
|
|
|
|
|
| |||||||
Total | 26,093,225 | 5,778,430 | 31,871,655 | |||||||||
|
|
|
|
|
| |||||||
Foreign offices: | ||||||||||||
Due in one year or less | 13,360,155 | 5,362,543 | 18,722,698 | |||||||||
Due after one year through two years | 53,837 | 176,331 | 230,168 | |||||||||
Due after two years through three years | 2,902 | 61,224 | 64,126 | |||||||||
Due after three years through four years | 764 | 4,062 | 4,826 | |||||||||
Due after four years through five years | 748 | — | 748 | |||||||||
Due after five years | 14,620 | — | 14,620 | |||||||||
|
|
|
|
|
| |||||||
Total | 13,433,026 | 5,604,160 | 19,037,186 | |||||||||
|
|
|
|
|
| |||||||
Total | 39,526,251 | 11,382,590 | 50,908,841 | |||||||||
|
|
|
|
|
|
Time deposits | Certificates of deposit | Total | ||||||||||
(in millions of yen) | ||||||||||||
Domestic offices: | ||||||||||||
Due in one year or less | 19,660,222 | 7,418,470 | 27,078,692 | |||||||||
Due after one year through two years | 1,676,056 | 140,300 | 1,816,356 | |||||||||
Due after two years through three years | 1,159,144 | — | 1,159,144 | |||||||||
Due after three years through four years | 335,659 | — | 335,659 | |||||||||
Due after four years through five years | 397,591 | — | 397,591 | |||||||||
Due after five years | 212,416 | — | 212,416 | |||||||||
Total | 23,441,088 | 7,558,770 | 30,999,858 | |||||||||
Foreign offices: | ||||||||||||
Due in one year or less | 17,936,190 | 5,565,541 | 23,501,731 | |||||||||
Due after one year through two years | 59,530 | 80,747 | 140,277 | |||||||||
Due after two years through three years | 9,536 | 11,224 | 20,760 | |||||||||
Due after three years through four years | 6,624 | — | 6,624 | |||||||||
Due after four years through five years | 2,788 | 66,280 | 69,068 | |||||||||
Due after five years | 3,268 | — | 3,268 | |||||||||
Total | 18,017,936 | 5,723,792 | 23,741,728 | |||||||||
Total | 41,459,024 | 13,282,562 | 54,741,586 | |||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
11.
The MHFG Group consolidates certain guaranteed principal money trusts. See Note 25 “Variable interest entities and securitizations” for further discussion of the guaranteed principal money trusts.
12.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Commercial paper and short-term notes issued by consolidated VIEs of asset-backed commercial paper programs(1) (2) | 59,607 | 27,985 | ||||||
Commercial paper and short-term notes issued by MHFG and its subsidiaries (1) (3) | 956,447 | 1,044,591 | ||||||
Borrowings from the Bank of Japan | 355,255 | 432,328 | ||||||
Other | 105,303 | 183,114 | ||||||
|
|
|
| |||||
Total | 1,476,612 | 1,688,018 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Short-term notes issued by consolidated VIEs of asset-backed commercial paper programs (1) | 22,339 | 54,658 | ||||||
Commercial paper and short-term notes issued by MHFG’s subsidiaries (1)(2) | 1,274,382 | 730,089 | ||||||
Borrowings from the Bank of Japan | 508,627 | 4,002,781 | ||||||
Other | 189,478 | 126,957 | ||||||
Total | 1,994,826 | 4,914,485 | ||||||
(1) | Short-term notes are issued under the laws of Japan in the form of |
(2) |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Obligations under capital leases | 40,947 | 36,010 | ||||||
Loan participation borrowings | 90,639 | 89,353 | ||||||
Senior borrowings and bonds | 11,119,136 | 9,184,075 | ||||||
Subordinated borrowings and bonds | 3,278,692 | 3,645,792 | ||||||
|
|
|
| |||||
Total | 14,529,414 | 12,955,230 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Obligations under finance leases | 25,020 | 16,250 | ||||||
Loan participation borrowings | 142,838 | 149,398 | ||||||
Senior borrowings and bonds | 7,503,032 | 6,402,157 | ||||||
Subordinated borrowings and bonds | 3,858,510 | 3,778,347 | ||||||
Total | 11,529,400 | 10,346,152 | ||||||
Interest rates (1) | Maturities (2) | 2017 | 2018 | |||||||||||||
(%) |
(in millions of yen) | |||||||||||||||
Senior borrowings and bonds: | ||||||||||||||||
fixed rate denominated in Japanese yen | 0.00-5.00 | Apr. 2018-Dec. 2046 | 6,011,939 | 4,146,989 | ||||||||||||
fixed rate denominated in U.S. dollars | 0.00-7.49 | Apr. 2018-Mar. 2048 | 2,533,715 | 2,519,845 | ||||||||||||
fixed rate denominated in other currencies | 0.01-9.29 | Apr. 2018-May. 2037 | 172,370 | 233,842 | ||||||||||||
floating rate denominated in Japanese yen | 0.00-19.00 | Apr. 2018-Mar. 2048 | 717,056 | 662,751 | ||||||||||||
floating rate denominated in U.S. dollars | 0.00-5.70 | Apr. 2018-Jul. 2033 | 1,557,288 | 1,469,248 | ||||||||||||
floating rate denominated in other currencies | 0.00-9.40 | Jun. 2018-Sep. 2035 | 126,768 | 151,400 | ||||||||||||
|
|
|
| |||||||||||||
Total | 11,119,136 | 9,184,075 | ||||||||||||||
|
|
|
| |||||||||||||
Subordinated borrowings and bonds: | ||||||||||||||||
fixed rate denominated in Japanese yen | 0.47-4.26 | Apr. 2018- Perpetual | 2,858,445 | 3,247,639 | ||||||||||||
fixed rate denominated in U.S. dollars | 4.30-4.70 | Jul. 2022-Oct. 2025 | 420,247 | 398,153 | ||||||||||||
|
|
|
| |||||||||||||
Total | 3,278,692 | 3,645,792 | ||||||||||||||
|
|
|
| |||||||||||||
Total | 14,397,828 | 12,829,867 | ||||||||||||||
|
|
|
|
Interest rates (1) | Maturities (2) | 2019 | 2020 | |||||||||||
(%) | (in millions of yen) | |||||||||||||
Senior borrowings and bonds: | ||||||||||||||
fixed rate denominated in Japanese yen | 0.00-8.10 | Apr.2020-Jan.2050 | 2,057,156 | 549,647 | ||||||||||
fixed rate denominated in U.S. dollars | 0.00-8.25 | Apr.2020-Mar.2048 | 2,765,247 | 2,744,713 | ||||||||||
fixed rate denominated in other currencies | 0.02-12.40 | Apr.2020-Sep.2039 | 324,162 | 609,346 | ||||||||||
floating rate denominated in Japanese yen | 0.00-51.60 | Apr.2020-Mar.2050 | 656,029 | 606,095 | ||||||||||
floating rate denominated in U.S. dollars | 0.00-37.20 | Apr.2020-Dec.2059 | 1,493,617 | 1,682,540 | ||||||||||
floating rate denominated in other currencies | 0.00-25.00 | Jun.2020-Oct.2030 | 206,821 | 209,816 | ||||||||||
Total | 7,503,032 | 6,402,157 | ||||||||||||
Subordinated borrowings and bonds: | ||||||||||||||
fixed rate denominated in Japanese yen | 0.39-4.26 | Aug.2020-Perpetual | 3,442,438 | 3,370,234 | ||||||||||
fixed rate denominated in U.S. dollars | 4.30-4.70 | Jul.2022-Oct.2025 | 416,072 | 408,113 | ||||||||||
Total | 3,858,510 | 3,778,347 | ||||||||||||
Total | 11,361,542 | 10,180,504 | ||||||||||||
(1) | The interest rates disclosed reflect the range of contractual rates in effect at March 31, |
(2) | Maturity information disclosed is the range of maturities at March 31, |
(3) | None of the long-term debt issuances above are convertible to common stock. |
(4) | Certain debt agreements permit the MHFG Group to redeem the related debt, in whole or in part, prior to maturity at the MHFG Group’s option on terms specified in the respective agreements. |
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2019 | 2,492,058 | |||
2020 | 1,606,863 | |||
2021 | 1,314,403 | |||
2022 | 1,204,785 | |||
2023 | 1,068,077 | |||
2024 and thereafter | 5,269,044 | |||
|
| |||
Total | 12,955,230 | |||
|
|
13.2020:
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2021 | 559,447 | |||
2022 | 1,430,157 | |||
2023 | 1,234,962 | |||
2024 | 697,214 | |||
2025 | 1,023,243 | |||
2026 and thereafter | 5,401,129 | |||
Total | 10,346,152 | |||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Other assets: | ||||||||
Accounts receivable: | ||||||||
Receivables from brokers, dealers and customers for securities transactions (1) | 1,564,295 | 1,578,952 | ||||||
Other | 324,135 | 368,030 | ||||||
Collateral pledged: | ||||||||
Collateral pledged for derivative transactions | 973,404 | 981,390 | ||||||
Margins provided for futures contracts | 276,398 | 142,156 | ||||||
Other | 336,538 | 965,137 | ||||||
Prepaid pension cost | 682,592 | 874,191 | ||||||
Security deposits | 122,858 | 126,001 | ||||||
Loans held for sale | 26,689 | 86,153 | ||||||
Other | 685,420 | 609,624 | ||||||
|
|
|
| |||||
Total | 4,992,329 | 5,731,634 | ||||||
|
|
|
| |||||
Other liabilities: | ||||||||
Accounts payable: | ||||||||
Payables to brokers, dealers and customers for securities transactions (1) | 1,400,141 | 1,410,785 | ||||||
Other | 481,809 | 455,789 | ||||||
Guaranteed trust principal (2) | 683,324 | 761,685 | ||||||
Collateral accepted: | ||||||||
Collateral accepted for derivative transactions | 671,691 | 598,524 | ||||||
Margins accepted for futures contracts | 307,066 | 325,038 | ||||||
Unearned income (3) | 134,666 | 130,916 | ||||||
Factoring amounts owed to customers | 53,488 | — | ||||||
Other | 1,294,340 | 1,022,858 | ||||||
�� |
|
|
|
| ||||
Total | 5,026,525 | 4,705,595 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Other assets: | ||||||||
Accounts receivable: | ||||||||
Receivables from brokers, dealers and customers for securities transactions (1) | 1,517,235 | 783,439 | ||||||
Other | 400,676 | 358,702 | ||||||
Collateral pledged: | ||||||||
Collateral pledged for derivative transactions | 856,439 | 1,246,026 | ||||||
Margins provided for futures contracts | 159,747 | 602,039 | ||||||
Other | 857,814 | 941,167 | ||||||
Prepaid pension cost | 850,472 | 711,981 | ||||||
ROU assets (2) | — | 613,068 | ||||||
Security deposits | 123,317 | 107,294 | ||||||
Loans held for sale | 24,921 | 60,084 | ||||||
Other | 485,383 | 542,079 | ||||||
Total | 5,276,004 | 5,965,879 | ||||||
Other liabilities: | ||||||||
Accounts payable: | ||||||||
Payables to brokers, dealers and customers for securities transactions (1) | 2,572,315 | 2,161,075 | ||||||
Other | 442,776 | 375,127 | ||||||
Guaranteed trust principal (3) | 809,450 | 824,431 | ||||||
Lease liabilities (2) | — | 627,250 | ||||||
Collateral accepted: | ||||||||
Collateral accepted for derivative transactions | 589,411 | 846,426 | ||||||
Margins accepted for futures contracts | 339,863 | 797,317 | ||||||
Unearned income (4) | 126,594 | 122,072 | ||||||
Other | 1,052,297 | 1,244,697 | ||||||
Total | 5,932,706 | 6,998,395 | ||||||
(1) | Receivables from brokers, dealers and customers for securities transactions |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Payables to brokers, dealers and customers for securities transactions |
(2) | ROU assets and lease liabilities were initially recognized in connection with the adoption of ASU No.2016-02 on April 1, 2019. See Note 1 “Basis of presentation and summary of significant accounting policies” and Note 2 “Issued accounting pronouncements” for further information. |
(3) | Guaranteed trust principal, included in All other liabilities in the disclosure about consolidated VIEs in the accompanying balance sheets, is |
Unearned income is primarily comprised of |
14.
2016 | Aggregate amount | Number of shares | Liquidation value per share | Convertible or not | ||||||||||||||||||||
Class of stock | Authorized (1) | Issued | In treasury | |||||||||||||||||||||
(in millions of yen) | (in yen) | |||||||||||||||||||||||
Eleventh series class XI preferred stock (2) | 914,752 | 914,752,000 | 914,752,000 | 815,828,400 | 1,000 | Yes | ||||||||||||||||||
First series class XIV preferred stock(3) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Second series class XIV preferred stock(3) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Third series class XIV preferred stock(3) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Fourth series class XIV preferred stock(3) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
First series class XV preferred stock(4) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Second series class XV preferred stock(4) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Third series class XV preferred stock(4) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
Fourth series class XV preferred stock(4) | — | 900,000,000 | — | — | — | — | ||||||||||||||||||
First series class XVI preferred stock(5) | — | 1,500,000,000 | — | — | — | — | ||||||||||||||||||
Second series class XVI preferred stock(5) | — | 1,500,000,000 | — | — | — | — | ||||||||||||||||||
Third series class XVI preferred stock(5) | — | 1,500,000,000 | — | — | — | — | ||||||||||||||||||
Fourth series class XVI preferred stock(5) | — | 1,500,000,000 | — | — | — | — | ||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||
Total | 914,752 | 914,752,000 | 815,828,400 | |||||||||||||||||||||
|
|
|
|
|
|
March 31, 2018 | March 31, 2019 | March 31, 2020 | ||||||||||||||||||||||
Class of stock | Authorized | Issued | Authorized | Issued | Authorized | Issued | ||||||||||||||||||
(number of shares) | ||||||||||||||||||||||||
Class XIV preferred stock | 900,000,000 | — | 900,000,000 | — | 900,000,000 | — | ||||||||||||||||||
Class XV preferred stock | 900,000,000 | — | 900,000,000 | — | 900,000,000 | — | ||||||||||||||||||
Class XVI preferred stock | 1,500,000,000 | — | 1,500,000,000 | — | 1,500,000,000 | — |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
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MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
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| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
| ||||||||||||||||||||||||
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MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
In June 2013, MHFG newly authorized class XIV preferred stock, class XV preferred stock and class XVI preferred stock to meet the requirements of Basel III. Under Basel III,
The following table shows the changes in the number of shares and the aggregate amount of preferred stock during the fiscal years ended March 31, 2016, 20172018, 2019 and 2018:
Class of stock | Issued shares at March 31, 2015 | Net change | Issued shares at March 31, 2016 | Net change | Issued shares at March 31, 2017 | Net change | Issued shares at March 31, 2018 | |||||||||||||||||||||
(number of shares) | ||||||||||||||||||||||||||||
Eleventh series class XI preferred stock(Note) | 914,752,000 | — | 914,752,000 | (914,752,000 | ) | — | — | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | 914,752,000 | — | 914,752,000 | (914,752,000 | ) | — | — | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Class of stock | Aggregate amount at March 31, 2015 | Net change | Aggregate amount at March 31, 2016 | Net change | Aggregate amount at March 31, 2017 | Net change | Aggregate amount at March 31, 2018 | |||||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||||||
Eleventh series class XI preferred stock(Note) | 914,752 | — | 914,752 | (914,752 | ) | — | — | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Total | 914,752 | — | 914,752 | (914,752 | ) | — | — | — | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
15.
2016 | 2017 | 2018 | ||||||||||
(shares) | ||||||||||||
Balance at beginning of fiscal year | 24,621,897,967 | 25,030,525,657 | 25,386,307,945 | |||||||||
Issuance of new shares of common stock due to conversion of Eleventh series class XI preferred stock | 403,667,690 | 349,677,288 | — | |||||||||
Issuance of new shares of common stock due to exercise of stock acquisition rights | 4,960,000 | 6,105,000 | 3,337,000 | |||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 25,030,525,657 | 25,386,307,945 | 25,389,644,945 | |||||||||
|
|
|
|
|
|
16.2020:
2018 | 2019 | 2020 | ||||||||||
(shares) | ||||||||||||
Balance at beginning of fiscal year | 25,386,307,945 | 25,389,644,945 | 25,392,498,945 | |||||||||
Issuance of new shares of common stock due to exercise of stock acquisition rights | 3,337,000 | 2,854,000 | — | |||||||||
Balance at end of fiscal year | 25,389,644,945 | 25,392,498,945 | 25,392,498,945 | |||||||||
The following table shows dividends on preferred stock and common stock during the fiscal years ended March 31, 2016, 2017 and 2018:
2016 | Cash dividends | |||||||
Class of stock | Per share | In aggregate | ||||||
(in yen) |
(in millions of yen) | |||||||
Eleventh series class XI preferred stock | 20 | 3,572 | ||||||
Common stock | 7.75 | 191,693 | ||||||
|
| |||||||
Total | 195,265 | |||||||
|
| |||||||
2017 | Cash dividends | |||||||
Class of stock | Per share | In aggregate | ||||||
(in yen) |
(in millions of yen) | |||||||
Eleventh series class XI preferred stock (Note) | 10 | 989 | ||||||
Common stock | 7.50 | 189,013 | ||||||
|
| |||||||
Total | 190,002 | |||||||
|
|
2018 | Cash dividends | |||||||
Class of stock | Per share | In aggregate | ||||||
(in yen) |
(in millions of yen) | |||||||
Common stock | 7.50 | 190,361 | ||||||
|
|
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
17.
(loss), net of tax
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
AOCI, balance at beginning of fiscal year, previously reported | 2,041,005 | 1,469,308 | 1,521,163 | |||||||||
Cumulative effect of change in accounting principles | — | 330 | — | |||||||||
AOCI, balance at beginning of fiscal year, adjusted | 2,041,005 | 1,469,638 | 1,521,163 | |||||||||
Net unrealized gains (losses) on available-for-sale securities: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 1,747,607 | 1,409,459 | 1,461,302 | |||||||||
Cumulative effect of change in accounting principles | — | (85 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | 1,747,607 | 1,409,374 | 1,461,302 | |||||||||
Unrealized holding gains (losses) during year | (189,479 | ) | 273,844 | 282,141 | ||||||||
Less: reclassification adjustments for losses (gains) included in net income | (148,669 | ) | (221,916 | ) | (186,858 | ) | ||||||
|
|
|
|
|
| |||||||
Change during year | (338,148 | ) | 51,928 | 95,283 | ||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 1,409,459 | 1,461,302 | 1,556,585 | |||||||||
Foreign currency translation adjustments: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 129,179 | 6,310 | (5,535 | ) | ||||||||
Cumulative effect of change in accounting principles | — | 415 | — | |||||||||
Balance at beginning of fiscal year, adjusted | 129,179 | 6,725 | (5,535 | ) | ||||||||
Foreign currency translation adjustments during year | (122,081 | ) | (11,920 | ) | (26,936 | ) | ||||||
Less: reclassification adjustments for losses (gains) included in net income | (788 | ) | (340 | ) | (2,605 | ) | ||||||
|
|
|
|
|
| |||||||
Change during year | (122,869 | ) | (12,260 | ) | (29,541 | ) | ||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 6,310 | (5,535 | ) | (35,076 | ) | |||||||
Pension liability adjustments: | ||||||||||||
Balance at beginning of fiscal year | 164,219 | 53,539 | 65,396 | |||||||||
Unrealized gains (losses) during year | (107,497 | ) | 11,561 | 157,737 | ||||||||
Less: reclassification adjustments for losses (gains) included in net income | (3,183 | ) | 296 | (2,748 | ) | |||||||
|
|
|
|
|
| |||||||
Change during year | (110,680 | ) | 11,857 | 154,989 | ||||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 53,539 | 65,396 | 220,385 | |||||||||
Total other comprehensive income (loss), net of tax attributable to MHFG shareholders | (571,697 | ) | 51,525 | 220,731 | ||||||||
|
|
|
|
|
| |||||||
AOCI, balance at end of fiscal year | 1,469,308 | 1,521,163 | 1,741,894 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
AOCI, balance at beginning of fiscal year, previously reported | 1,521,163 | 1,741,894 | 164,021 | |||||||||
Cumulative effect of change in accounting principles (1) | — | (1,535,142 | ) | (1,052 | ) | |||||||
AOCI, balance at beginning of fiscal year, adjusted | 1,521,163 | 206,752 | 162,969 | |||||||||
Net unrealized gains (losses) on available-for-sale securities: | ||||||||||||
Balance at beginning of fiscal year, previously reported | 1,461,302 | 1,556,585 | 22,019 | |||||||||
Cumulative effect of change in accounting principles (1) | — | (1,525,064 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | 1,461,302 | 31,521 | 22,019 | |||||||||
Unrealized holding gains (losses) during year | 282,141 | (11,358 | ) | (22,566 | ) | |||||||
Less: reclassification adjustments for losses (gains) included in net income | (186,858 | ) | 1,856 | (19,045 | ) | |||||||
Change during year | 95,283 | (9,502 | ) | (41,611 | ) | |||||||
Balance at end of fiscal year | 1,556,585 | 22,019 | (19,592 | ) | ||||||||
Foreign currency translation adjustments: | ||||||||||||
Balance at beginning of fiscal year, previously reported | (5,535 | ) | (35,076 | ) | (58,558 | ) | ||||||
Cumulative effect of change in accounting principles (1) | — | — | (1,052 | ) | ||||||||
Balance at beginning of fiscal year, adjusted | (5,535 | ) | (35,076 | ) | (59,610 | ) | ||||||
Foreign currency translation adjustments during year | (26,936 | ) | (22,737 | ) | (49,888 | ) | ||||||
Less: reclassification adjustments for losses (gains) included in net income | (2,605 | ) | (745 | ) | (374 | ) | ||||||
Change during year | (29,541 | ) | (23,482 | ) | (50,262 | ) | ||||||
Balance at end of fiscal year | (35,076 | ) | (58,558 | ) | (109,872 | ) | ||||||
Pension liability adjustments: | ||||||||||||
Balance at beginning of fiscal year | 65,396 | 220,385 | 196,446 | |||||||||
Unrealized gains (losses) during year | 157,737 | (17,243 | ) | (122,219 | ) | |||||||
Less: reclassification adjustments for losses (gains) included in net income | (2,748 | ) | (6,696 | ) | (4,772 | ) | ||||||
Change during year | 154,989 | (23,939 | ) | (126,991 | ) | |||||||
Balance at end of fiscal year | 220,385 | 196,446 | 69,455 | |||||||||
Own credit risk adjustments (2) : | ||||||||||||
Balance at beginning of fiscal year, previously reported | — | — | 4,114 | |||||||||
Cumulative effect of change in accounting principles (1) | — | (10,078 | ) | — | ||||||||
Balance at beginning of fiscal year, adjusted | — | (10,078 | ) | 4,114 | ||||||||
Unrealized gains (losses) during year | — | 14,293 | 45,560 | |||||||||
Less: reclassification adjustments for losses (gains) included in net income | — | (101 | ) | 841 | ||||||||
Change during year | — | 14,192 | 46,401 | |||||||||
Balance at end of fiscal year | — | 4,114 | 50,515 | |||||||||
Total other comprehensive income (loss), net of tax attributable to MHFG shareholders | 220,731 | (42,731 | ) | (172,463 | ) | |||||||
AOCI, balance at end of fiscal year | 1,741,894 | 164,021 | (9,494 | ) | ||||||||
(1) | See Note 2 “Issued accounting pronouncements” for further details of the cumulative-effect adjustment for AOCI. |
(2) | The MHFG Group adopted ASU No.2016-01 on April 1, 2018. The ASU requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. See Note 2 “Issued accounting pronouncements” for further details. |
Before tax(1) | Tax effect(2) | Net of tax before allocation to noncontrolling interests | Net of tax attributable to noncontrolling interests(2) | Net of tax attributable to MHFG shareholders | ||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||
Amounts reclassified out of AOCI into net income: | Affected line items in the consolidated statements of income: | |||||||||||||||||||||
Net unrealized gains (losses) on available-for-sale securities | 269,808 | (82,828 | ) | 186,980 | (122 | ) | 186,858 | Investment gains (losses)—net | ||||||||||||||
Foreign currency translation adjustments | 2,605 | — | 2,605 | — | 2,605 | Investment gains (losses)—net | ||||||||||||||||
Pension liability adjustments | 2,560 | 190 | 2,750 | (2 | ) | 2,748 | Salaries and employee benefits | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 274,973 | (82,638 | ) | 192,335 | (124 | ) | 192,211 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
2020:
Before tax (1) | Tax effect (2) | Net of tax before allocation to noncontrolling interests | Net of tax attributable to noncontrolling interests (2) | Net of tax attributable to MHFG shareholders | ||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||
Amounts reclassified out of AOCI into net income: | Affected line items in the consolidated statements of income: | |||||||||||||||||||||
Net unrealized gains (losses) on available-for-sale securities | 27,449 | (8,410 | ) | 19,039 | 6 | 19,045 | Investment gains (losses)—net | |||||||||||||||
Foreign currency translation adjustments | 374 | — | 374 | — | 374 | Investment gains (losses)—net | ||||||||||||||||
Pension liability adjustments | 6,618 | (1,765 | ) | 4,853 | (81 | ) | 4,772 | Salaries and employee benefits | ||||||||||||||
Own credit risk adjustments | (1,265 | ) | 387 | (878 | ) | 37 | (841 | ) | Other noninterest income (expenses) | |||||||||||||
Total | 33,176 | (9,788 | ) | 23,388 | (38 | ) | 23,350 | |||||||||||||||
(1) | The financial statement line item in which the amounts in the Before tax column are |
(2) | The financial statement line items in which the |
18.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
became effective from March 31, 2013, which generally reflect the rules in the Basel III rules text that have been applied from January 1, 2013. The framework of Basel III is based on the following
With regard to risk-based capital, the guidelines based on Basel III set out higher and better-quality capital standards compared to those under Basel II, which had been effective until Basel III was applied. The guidelines based on Basel III require a target minimum standard capital adequacy ratio of 8%, Tier 1 capital ratio of 6% and Common Equity Tier 1 capital, Tier 1 capital (Common Equity Tier 1 capital and Additional Tier 1 capital) and total risk-based capital (Tier 1 and Tier 2 capital) divided by risk-weighted assets. Common Equity Tier 1 capital primarily consists of common stock, capital surplus, retained earnings and AOCI. Regulatory adjustments including certain intangible fixed assets, such as goodwill, and defined-benefit pension fund assets will be deducted from Common Equity Tier 1. Additional Tier 1 capital generally consists of Basel III compliant preferred securities and other capital that meets Tier 1 requirements under Basel II standards, net of regulatory adjustments. Tier 2 capital generally consists of Basel III compliant deferred obligations, such as subordinated debts, capital that meets Tier 2 requirements under Basel II standards, certain allowances for credit losses and noncontrolling interests in subsidiaries’ Tier 2 instruments.
Risk-based Within the minimum capital calculated from financial statements prepared under Japanese GAAP, is classified intoadequacy ratio, the following two tiers: Tier 1 capital; and Tier 2 capital. Tier 1 capital consists of Common Equity Tier 1 capital requirement is 4.5% and Additional Tier 1 capital. Common Equitythe Tier 1 capital generally consists of common stock, capital surplus, retained earnings, accumulated other comprehensive income and other disclosed reserves and others less any regulatory adjustments. Additional Tier 1 capital generally consists of instruments issued by a bank or its holding company that meet the criteria for inclusion in Additional Tier 1 capital and others less any regulatory adjustments. Tier 2 capital generally consists of instruments issued by a bank or its holding company such as subordinated debt that meet the criteria for inclusion in Tier 2 capital, general reserve for possible losses on loans (equaling the sum of (i) the excess of the amount of qualified reserves over the amount of expected losses and (ii) the amount of general reserves calculated based on the standardized approach) and others less any regulatory adjustments.
requirement is 6.0%.
In November 2011, the Financial Stability Board (“FSB”) published policy measures to address the systemic and moral hazard risks associated with systemically important financial institutions. The policy measures include requirements for global systemically important banks (“G-SIBs”) to have additional loss absorption capacity tailored to the impact of their default, ranging from 1% to 2.5% of risk-weighted assets, to be met with Common Equity Tier 1 capital, which would be in addition to the 7.0% Common Equity Tier 1 capital requirement (including capital conservation buffer). The requirements began phasing in from January 2016 and will be fully implemented by January 2019. The Group was included in the list of G-SIBs updated in November 2017 and was allocated to the category that would require 1.0% of additional loss absorbency.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(“D-SIBs”).
In December 2015, the Financial Service Agency published a capital adequacy guideline regarding the designation of G-SIBs and D-SIBs in Japan. The Group was Further, MHFG is currently designated as both a
Regulatory adjustments such as goodwill
2019, the Financial Services Agency published the revised leverage ratio framework and the minimum leverage ratio is defined as 3% on both a consolidated and
March 2017 | March 2018 | March 2019 | March 2020 | March 2021 | March 2022 | |||||||||||||||||||
Minimum Common Equity Tier 1 capital | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | ||||||||||||
Minimum Tier 1 capital | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | ||||||||||||
Minimum total capital | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | ||||||||||||
Phase-in of deductions from capital | 80.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||
Phase out of recognition of capital instruments that no longer qualify as capital | 50.0 | % | 40.0 | % | 30.0 | % | 20.0 | % | 10.0 | % | 0.0 | % | ||||||||||||
Capital conservation buffer | 1.25 | % | 1.875 | % | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | ||||||||||||
Countercyclical capital buffer (1) | 0.00 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | ||||||||||||
Additional loss absorbency requirements for G-SIBs andD-SIBs (2) | 0.50 | % | 0.75 | % | 1.0 | % | 1.0 | % | 1.0 | % | 1.0 | % |
March 2019 | March 2020 | March 2021 | March 2022 | March 2023 | ||||||||||||||||
Minimum Common Equity Tier 1 capital | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | 4.5 | % | ||||||||||
Minimum Tier 1 capital | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | 6.0 | % | ||||||||||
Minimum total capital | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | 8.0 | % | ||||||||||
Phase out of recognition of capital instruments that no longer qualify as capital | 30.0 | % | 20.0 | % | 10.0 | % | 0.0 | % | 0.0 | % | ||||||||||
Capital conservation buffer | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | ||||||||||
Countercyclical capital buffer (1) | 0.05 | % | 0.01 | % | 0.01 | % | 0.01 | % | 0.01 | % | ||||||||||
Additional loss absorbency requirements for G-SIBs andD-SIBs (2) | 1.0 | % | 1.0 | % | 1.0 | % | 1.0 | % | 1.0 | % | ||||||||||
Minimum Leverage Ratio | 3.0 | % | 3.0 | % | 3.0 | % | 3.0 | % | 3.5 | % (3) |
(1) | Figures assume that the countercyclical capital buffer will continue to be 0.01% after March |
(2) | Figures assume that the additional loss absorbency requirements applied to the Group as a G-SIB andD-SIB continue to be 1.0% on a fully effective |
(3) | This figure includes a leverage ratio buffer required to be met at 50% of the additional loss absorbency requirements applied to the Group as a G-SIB under the finalized Basel III reforms. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2017 | 2018 | |||||||||||||||
Amount | Ratio | Amount | Ratio | |||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||
Consolidated: | ||||||||||||||||
MHFG: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required (Note) | 3,857 | 6.25 | 4,247 | 7.135 | ||||||||||||
Actual | 7,002 | 11.34 | 7,437 | 12.49 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required (Note) | 4,783 | 7.75 | 5,140 | 8.635 | ||||||||||||
Actual | 8,212 | 13.30 | 9,192 | 15.44 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required(Note) | 6,017 | 9.75 | 6,331 | 10.635 | ||||||||||||
Actual | 10,051 | 16.28 | 10,860 | 18.24 | ||||||||||||
MHBK: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 2,541 | 4.50 | 2,400 | 4.50 | ||||||||||||
Actual | 6,304 | 11.16 | 6,584 | 12.34 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 3,388 | 6.00 | 3,200 | 6.00 | ||||||||||||
Actual | 7,536 | 13.34 | 8,330 | 15.61 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 4,517 | 8.00 | 4,267 | 8.00 | ||||||||||||
Actual | 9,149 | 16.20 | 9,881 | 18.52 | ||||||||||||
MHTB: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 112 | 4.50 | 112 | 4.50 | ||||||||||||
Actual | 466 | 18.73 | 498 | 19.99 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 149 | 6.00 | 149 | 6.00 | ||||||||||||
Actual | 466 | 18.73 | 499 | 20.05 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 199 | 8.00 | 199 | 8.00 | ||||||||||||
Actual | 485 | 19.47 | 505 | 20.28 | ||||||||||||
Non-consolidated: | ||||||||||||||||
MHBK: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 2,432 | 4.50 | 2,312 | 4.50 | ||||||||||||
Actual | 6,057 | 11.20 | 6,330 | 12.32 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 3,243 | 6.00 | 3,082 | 6.00 | ||||||||||||
Actual | 7,316 | 13.53 | 8,081 | 15.73 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 4,324 | 8.00 | 4,109 | 8.00 | ||||||||||||
Actual | 8,938 | 16.53 | 9,619 | 18.72 | ||||||||||||
MHTB: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 113 | 4.50 | 112 | 4.50 | ||||||||||||
Actual | 475 | 18.98 | 504 | 20.28 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 150 | 6.00 | 149 | 6.00 | ||||||||||||
Actual | 475 | 18.98 | 504 | 20.28 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 200 | 8.00 | 199 | 8.00 | ||||||||||||
Actual | 493 | 19.70 | 509 | 20.50 |
2019 | 2020 | |||||||||||||||
Amount | Ratio | Amount | Ratio | |||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||
Consolidated: | ||||||||||||||||
MHFG: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required (Note) | 4,661 | 8.05 | 4,978 | 8.01 | ||||||||||||
Actual | 7,390 | 12.76 | 7,245 | 11.65 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required (Note) | 5,529 | 9.55 | 5,910 | 9.51 | ||||||||||||
Actual | 9,232 | 15.94 | 9,024 | 14.52 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required (Note) | 6,687 | 11.55 | 7,152 | 11.51 | ||||||||||||
Actual | 10,918 | 18.85 | 10,722 | 17.25 | ||||||||||||
Leverage Ratio: | ||||||||||||||||
Required | 6,257 | 3.00 | 6,629 | 3.00 | ||||||||||||
Actual | 9,232 | 4.42 | 9,024 | 4.08 | ||||||||||||
MHBK: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 2,388 | 4.50 | 2,567 | 4.50 | ||||||||||||
Actual | 6,690 | 12.60 | 6,501 | 11.39 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 3,184 | 6.00 | 3,422 | 6.00 | ||||||||||||
Actual | 8,527 | 16.06 | 8,275 | 14.50 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 4,246 | 8.00 | 4,563 | 8.00 | ||||||||||||
Actual | 10,098 | 19.02 | 9,865 | 17.29 | ||||||||||||
Leverage Ratio: | ||||||||||||||||
Required | 5,758 | 3.00 | 6,160 | 3.00 | ||||||||||||
Actual | 8,527 | 4.44 | 8,275 | 4.02 | ||||||||||||
MHTB: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 95 | 4.50 | 93 | 4.50 | ||||||||||||
Actual | 500 | 23.67 | 489 | 23.64 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 127 | 6.00 | 124 | 6.00 | ||||||||||||
Actual | 501 | 23.70 | 489 | 23.66 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 169 | 8.00 | 165 | 8.00 | ||||||||||||
Actual | 505 | 23.87 | 491 | 23.74 | ||||||||||||
Leverage Ratio: | ||||||||||||||||
Required | 229 | 3.00 | 216 | 3.00 | ||||||||||||
Actual | 501 | 6.55 | 489 | 6.79 | ||||||||||||
Non-consolidated: | ||||||||||||||||
MHBK: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 2,272 | 4.50 | 2,403 | 4.50 | ||||||||||||
Actual | 6,363 | 12.60 | 6,130 | 11.47 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 3,029 | 6.00 | 3,204 | 6.00 | ||||||||||||
Actual | 8,199 | 16.23 | 7,905 | 14.80 |
2019 | 2020 | |||||||||||||||
Amount | Ratio | Amount | Ratio | |||||||||||||
(in billions of yen, except percentages) | ||||||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 4,039 | 8.00 | 4,272 | 8.00 | ||||||||||||
Actual | 9,757 | 19.32 | 9,482 | 17.75 | ||||||||||||
Leverage Ratio: | ||||||||||||||||
Required | 5,517 | 3.00 | 5,884 | 3.00 | ||||||||||||
Actual | 8,199 | 4.45 | 7,905 | 4.03 | ||||||||||||
MHTB: | ||||||||||||||||
Common Equity Tier 1 capital: | ||||||||||||||||
Required | 94 | 4.50 | 93 | 4.50 | ||||||||||||
Actual | 494 | 23.58 | 475 | 23.10 | ||||||||||||
Tier 1 capital: | ||||||||||||||||
Required | 126 | 6.00 | 123 | 6.00 | ||||||||||||
Actual | 494 | 23.58 | 475 | 23.10 | ||||||||||||
Total risk-based capital: | ||||||||||||||||
Required | 168 | 8.00 | 165 | 8.00 | ||||||||||||
Actual | 498 | 23.75 | 477 | 23.18 | ||||||||||||
Leverage Ratio: | ||||||||||||||||
Required | 227 | 3.00 | 214 | 3.00 | ||||||||||||
Actual | 494 | 6.53 | 475 | 6.66 |
Note: | The required ratios disclosed above, at March 31, of G-SIBs andD-SIBs of |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
19.
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Net income: | ||||||||||||
Net income attributable to MHFG shareholders | 850,492 | 362,440 | 577,608 | |||||||||
Less: Net income attributable to preferred shareholders | 2,430 | — | — | |||||||||
|
|
|
|
|
| |||||||
Net income attributable to common shareholders | 848,062 | 362,440 | 577,608 | |||||||||
|
|
|
|
|
| |||||||
Effect of dilutive securities: | ||||||||||||
Convertible preferred stock | 2,430 | — | — | |||||||||
|
|
|
|
|
| |||||||
Net income attributable to common shareholders after assumed conversions | 850,492 | 362,440 | 577,608 | |||||||||
|
|
|
|
|
| |||||||
2016 | 2017 | 2018 | ||||||||||
(thousands of shares) | ||||||||||||
Shares: | ||||||||||||
Weighted average common shares outstanding | 24,806,161 | 25,285,899 | 25,366,345 | |||||||||
|
|
|
|
|
| |||||||
Effect of dilutive securities: | ||||||||||||
Convertible preferred stock (Note) | 563,044 | 82,993 | — | |||||||||
Stock options | 17,828 | 11,410 | 7,586 | |||||||||
|
|
|
|
|
| |||||||
Weighted average common shares after assumed conversions | 25,387,033 | 25,380,302 | 25,373,931 | |||||||||
|
|
|
|
|
| |||||||
2016 | 2017 | 2018 | ||||||||||
(in yen) | ||||||||||||
Amounts per common share: | ||||||||||||
Basic net income per common share | 34.19 | 14.33 | 22.77 | |||||||||
|
|
|
|
|
| |||||||
Diluted net income per common share | 33.50 | 14.28 | 22.76 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Net income: | ||||||||||||
Net income attributable to MHFG common shareholders | 577,608 | 84,471 | 150,195 | |||||||||
Effect of dilutive securities | — | — | — | |||||||||
Net income attributable to common shareholders after assumed conversions | 577,608 | 84,471 | 150,195 | |||||||||
2018 | 2019 | 2020 | ||||||||||
(thousands of shares) | ||||||||||||
Shares: | ||||||||||||
Weighted average common shares outstanding | 25,366,345 | 25,362,376 | 25,373,681 | |||||||||
Effect of dilutive securities: | ||||||||||||
Stock options and the common shares of MHFG under the stock compensation programs (Note) | 7,586 | 4,522 | 1,583 | |||||||||
Weighted average common shares after assumed conversions | 25,373,931 | 25,366,898 | 25,375,264 | |||||||||
2018 | 2019 | 2020 | ||||||||||
(in yen) | ||||||||||||
Earnings per common share: | ||||||||||||
Basic net income per common share | 22.77 | 3.33 | 5.92 | |||||||||
Diluted net income per common share (Note) | 22.76 | 3.33 | 5.92 | |||||||||
Note: |
20.
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Current: | ||||||||||||
Domestic | 162,408 | 130,164 | 130,573 | |||||||||
Foreign | 61,009 | 68,512 | 47,020 | |||||||||
|
|
|
|
|
| |||||||
Total current tax expense | 223,417 | 198,676 | 177,593 | |||||||||
|
|
|
|
|
| |||||||
Deferred: | ||||||||||||
Domestic | 127,185 | (99,831 | ) | 58,078 | ||||||||
Foreign | (4,060 | ) | (7,601 | ) | 1,933 | |||||||
|
|
|
|
|
| |||||||
Total deferred tax expense (benefit) | 123,125 | (107,432 | ) | 60,011 | ||||||||
|
|
|
|
|
| |||||||
Total income tax expense | 346,542 | 91,244 | 237,604 | |||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Current: | ||||||||||||
Domestic | 130,573 | 116,695 | 96,231 | |||||||||
Foreign | 47,020 | 49,871 | 52,885 | |||||||||
Total current tax expense | 177,593 | 166,566 | 149,116 | |||||||||
Deferred: | ||||||||||||
Domestic | 58,078 | (162,475 | ) | (111,341 | ) | |||||||
Foreign | 1,933 | 5,244 | 9,400 | |||||||||
Total deferred tax expense (benefit) | 60,011 | (157,231 | ) | (101,941 | ) | |||||||
Total income tax expense | 237,604 | 9,335 | 47,175 | |||||||||
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Net unrealized gains (losses) on available-for-sale securities: | ||||||||||||
Unrealized gains (losses) | (97,339 | ) | 112,467 | 123,186 | ||||||||
Less: reclassification adjustments | (65,207 | ) | (97,729 | ) | (82,828 | ) | ||||||
|
|
|
|
|
| |||||||
Total | (162,546 | ) | 14,738 | 40,358 | ||||||||
|
|
|
|
|
| |||||||
Foreign currency translation adjustments: | ||||||||||||
Unrealized gains (losses) | 126 | — | — | |||||||||
Less: reclassification adjustments | — | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | 126 | — | — | |||||||||
|
|
|
|
|
| |||||||
Pension liability adjustments: | ||||||||||||
Unrealized gains (losses) | (51,661 | ) | 4,785 | 66,331 | ||||||||
Less: reclassification adjustments | (1,317 | ) | 178 | 190 | ||||||||
|
|
|
|
|
| |||||||
Total | (52,978 | ) | 4,963 | 66,521 | ||||||||
|
|
|
|
|
| |||||||
Total tax effect before allocation to noncontrolling interests | (215,398 | ) | 19,701 | 106,879 | ||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Net unrealized gains (losses) on available-for-sale securities: | ||||||||||||
Unrealized gains (losses) | 123,186 | (3,940 | ) | (10,012 | ) | |||||||
Less: reclassification adjustments | (82,828 | ) | 889 | (8,410 | ) | |||||||
Total | 40,358 | (3,051 | ) | (18,422 | ) | |||||||
Pension liability adjustments: | ||||||||||||
Unrealized gains (losses) | 66,331 | (6,558 | ) | (52,888 | ) | |||||||
Less: reclassification adjustments | 190 | (2,370 | ) | (1,765 | ) | |||||||
Total | 66,521 | (8,928 | ) | (54,653 | ) | |||||||
Own credit risk adjustments (Note) : | ||||||||||||
Unrealized gains (losses) | — | 3,033 | 5,052 | |||||||||
Less: reclassification adjustments | — | (47 | ) | 387 | ||||||||
Total | — | 2,986 | 5,439 | |||||||||
Total tax effect before allocation to noncontrolling interests | 106,879 | (8,993 | ) | (67,636 | ) | |||||||
Note: | The MHFG Group adopted ASU No.2016-01 on April 1, 2018. The ASU requires an entity to present separately in other comprehensive income the portion of the total change in the fair value of a liability resulting from a change in the instrument-specific credit risk when the entity has elected to measure the liability at fair value in accordance with the fair value option for financial instruments. See Note 2 “Issued accounting pronouncements” for further details. |
2016 | 2017 | 2018 | ||||||||||
(in millions of yen, except tax rates) | ||||||||||||
Income before income tax expense | 1,196,605 | 480,375 | 839,298 | |||||||||
Effective statutory tax rate | 33.06 | % | 30.86 | % | 30.86 | % | ||||||
|
|
|
|
|
| |||||||
Income tax calculated at the statutory tax rate | 395,598 | 148,244 | 259,007 | |||||||||
Income not subject to tax | (12,888 | ) | (7,521 | ) | (9,312 | ) | ||||||
Expenses not deductible for tax purposes | 1,521 | 1,483 | 1,421 | |||||||||
Tax rate differentials of subsidiaries | (2,208 | ) | (2,165 | ) | (2,696 | ) | ||||||
Change in valuation allowance | (1,897 | ) | 112,781 | (2) | (9,102 | ) | ||||||
Change in undistributed earnings of subsidiaries | (16,112 | ) | 5,217 | (1,972 | ) | |||||||
Change in net operating loss carryforwards resulting from intercompany capital transactions | (1,446 | ) | 647 | — | ||||||||
Effect of enacted change in tax rates | (7,976 | ) (1) | — | 6,863 | (3) | |||||||
Reversal of outside basis differences | — | (159,119 | ) (2) | — | ||||||||
Other | (8,050 | ) | (8,323 | ) | (6,605 | ) | ||||||
|
|
|
|
|
| |||||||
Income tax expense | 346,542 | 91,244 | 237,604 | |||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen, except tax rates) | ||||||||||||
Income before income tax expense | 839,298 | 85,060 | 153,490 | |||||||||
Effective statutory tax rate | 30.86 | % | 30.62 | % | 30.62 | % | ||||||
Income tax calculated at the statutory tax rate | 259,007 | 26,045 | 46,999 | |||||||||
Income not subject to tax | (9,312 | ) | (8,861 | ) | (7,758 | ) | ||||||
Expenses not deductible for tax purposes | 1,421 | 1,389 | 1,290 | |||||||||
Tax rate differentials of subsidiaries | (2,696 | ) | (3,522 | ) | (5,756 | ) | ||||||
Change in valuation allowance | (9,102 | ) | (2,444 | ) | 5,984 | |||||||
Noncontrolling interest income (loss) of consolidated VIEs | (5,928 | ) | 3,475 | 14,796 | ||||||||
Effect of enacted change in tax rates | 6,863 | (1) | (11 | ) | (210 | ) | ||||||
Change in unrecognized tax benefits | — | 9,420 | — | |||||||||
Other (2) | (2,649 | ) | (16,156 | ) (3) | (8,170 | ) | ||||||
Income tax expense | 237,604 | 9,335 | 47,175 | |||||||||
(1) |
On December 22, 2017, the President of the United States signed into law the Tax Cuts and Jobs Act, which includes a reduction in the U.S. federal corporate income tax rate from 35% to 21%. The decrease in the Group’s balance of net deferred tax assets, reflecting such tax rate reductions, was recognized as an increase to Income tax expense in the fiscal year ended March 31, 2018. |
(2) | Change in undistributed earnings of |
(3) | In the fiscal year ended March 31, 2019, the MHFG Group derecognized the majority of deferred tax liabilities for undistributed earnings of foreign subsidiaries because the Group has intent and ability to reinvest those earnings indefinitely in certain foreign subsidiaries. |
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Deferred tax assets: | ||||||||
Investments | 497,629 | 453,880 | ||||||
Allowance for loan losses | 184,366 | 126,977 | ||||||
Derivative financial instruments | 14,537 | 53,336 | ||||||
Premises and equipment | 3,594 | 4,896 | ||||||
Trading securities | 30,841 | 1,988 | ||||||
Net operating loss carryforwards(1) (2) | 452,166 | 178,256 | ||||||
Other | 190,083 | 204,005 | ||||||
|
|
|
| |||||
1,373,216 | 1,023,338 | |||||||
Valuation allowance(1) (2) | (438,344 | ) | (163,358 | ) | ||||
|
|
|
| |||||
Deferred tax assets, net of valuation allowance | 934,872 | 859,980 | ||||||
|
|
|
| |||||
Deferred tax liabilities: | ||||||||
Available-for-sale securities | 724,160 | 764,497 | ||||||
Prepaid pension cost and accrued pension liabilities | 195,620 | 255,239 | ||||||
Undistributed earnings of subsidiaries | 17,161 | 15,189 | ||||||
Other | 74,886 | 74,170 | ||||||
|
|
|
| |||||
Deferred tax liabilities | 1,011,827 | 1,109,095 | ||||||
|
|
|
| |||||
Net deferred tax assets (liabilities) | (76,955 | ) | (249,115 | ) | ||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Deferred tax assets: | ||||||||
Lease liabilities (1) | — | 191,873 | ||||||
Allowance for loan losses | 122,585 | 165,665 | ||||||
Premises and equipment | 73,944 | 77,513 | ||||||
Available-for-sale securities | — | 5,532 | ||||||
Derivative financial instruments | 48,487 | 4,647 | ||||||
Investments | — | 3,563 | ||||||
Net operating loss carryforwards (2) | 167,755 | 163,264 | ||||||
Other | 216,568 | 203,004 | ||||||
629,339 | 815,061 | |||||||
Valuation allowance ( 2 ) | (158,581 | ) | (165,278 | ) | ||||
Deferred tax assets, net of valuation allowance | 470,758 | 649,783 | ||||||
Deferred tax liabilities: | ||||||||
Prepaid pension cost and accrued pension liabilities | 247,694 | 202,930 | ||||||
ROU assets (1) | — | 188,591 | ||||||
Trading securities | 9,158 | 58,266 | ||||||
Investments | 198,495 | — | ||||||
Available-for-sale securities | 12,426 | — | ||||||
Other | 61,330 | 89,157 | ||||||
Deferred tax liabilities | 529,103 | 538,944 | ||||||
Net deferred tax assets (liabilities) | (58,345 | ) | 110,839 | |||||
(1) | ROU assets and lease liabilities were initially recognized in connection with the adoption of No.2016-02 on April 1, 2019. See Note 1 “Basis of |
(2) | The amount includes |
Deferred tax assets | Valuation allowance | Deferred tax assets, net of valuation allowance | ||||||||||
(in billions of yen) | ||||||||||||
2017 | ||||||||||||
Japan(1) | 388 | (362 | ) | 26 | ||||||||
The United States | 15 | (3 | ) | 12 | ||||||||
The United Kingdom(2) | 46 | (46 | ) | — | ||||||||
Others | 3 | (3 | ) | — | ||||||||
|
|
|
|
|
| |||||||
Total | 452 | (414 | ) | 38 | ||||||||
|
|
|
|
|
| |||||||
2018 | ||||||||||||
Japan(3) | 117 | (88 | ) | 29 | ||||||||
The United States | 10 | (1 | ) | 9 | ||||||||
The United Kingdom(2) | 48 | (48 | ) | — | ||||||||
Others | 3 | (2 | ) | 1 | ||||||||
|
|
|
|
|
| |||||||
Total | 178 | (139 | ) | 39 | ||||||||
|
|
|
|
|
|
2020:
Deferred tax assets | Valuation allowance | Deferred tax assets, net of valuation allowance | ||||||||||
(in billions of yen) | ||||||||||||
2019 | ||||||||||||
Japan (1) | 111 | (92 | ) | 19 | ||||||||
The United States | 8 | — | 8 | |||||||||
The United Kingdom (2) | 46 | (46 | ) | — | ||||||||
Others | 3 | (2 | ) | 1 | ||||||||
Total | 168 | (140 | ) | 28 | ||||||||
2020 | ||||||||||||
Japan (3) | 110 | (92 | ) | 18 | ||||||||
The United States | 3 | — | 3 | |||||||||
The United Kingdom (2) | 47 | (47 | ) | — | ||||||||
Others | 3 | (2 | ) | 1 | ||||||||
Total | 163 | (141 | ) | 22 | ||||||||
(1) | ¥ |
(2) | The United Kingdom net operating loss carryforwards may be carried forward indefinitely for tax purposes. |
(3) | ¥ |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIESNOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Balance at beginning of fiscal year | 388,551 | 339,922 | 438,344 | |||||||||
Changes that directly affected Income tax expense | (1,897 | ) | 112,781 | (9,102 | ) | |||||||
Changes that did not affect Income tax expense: | ||||||||||||
Expiration of net operating loss carryforwards | — | — | (264,234 | ) | ||||||||
Others | (46,732 | ) | (14,359 | ) | (1,650 | ) | ||||||
|
|
|
|
|
| |||||||
Total | (46,732 | ) | (14,359 | ) | (265,884 | ) | ||||||
|
|
|
|
|
| |||||||
Balance at end of fiscal year | 339,922 | 438,344 | 163,358 | |||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Balance at beginning of fiscal year | 438,344 | 163,358 | 158,581 | |||||||||
Changes that directly affected Income tax expense | (9,102 | ) | (2,444 | ) | 5,984 | |||||||
Changes that did not affect Income tax expense: | ||||||||||||
Expiration of net operating loss carryforwards | (264,234 | ) | — | — | ||||||||
Others | (1,650 | ) | (2,333 | ) | 713 | |||||||
Total | (265,884 | ) | (2,333 | ) | 713 | |||||||
Balance at end of fiscal year | 163,358 | 158,581 | 165,278 | |||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
operating loss carryforwards, primarily related to the reversal of an outside basis difference related to certain foreign subsidiaries due to their organizational restructuring. The decrease in the fiscal year ended March 31, 2017 of ¥14,359 million in others was primarily related to a decrease in the valuation allowance that is fully recognized against the MHFG Group’s net operating loss carryforwards due to tax rate reductions and foreign currency rate reductions of MHFG’s foreign subsidiaries.
The decrease in the fiscal year ended March 31, 2018 of ¥9,102¥5,984 million in the valuation allowance that directly affected Income tax expense was primarily related to an increasea decrease of the realizability of deferred tax assets of MHFG’sMHFG and its subsidiaries.
Net operating loss carryforwards | ||||
(in billions of yen) | ||||
Fiscal year ending March 31: | ||||
2019 | 4 | |||
2020 | — | |||
2021 | — | |||
2022 | — | |||
2023 | 16 | |||
2024 and thereafter(Note) | 703 | |||
|
| |||
Total | 723 | |||
|
|
Net operating loss carryforwards | ||||
(in billions of yen) | ||||
Fiscal year ending March 31: | ||||
2021 | — | |||
2022 | — | |||
2023 | 6 | |||
2024 | 3 | |||
2025 | — | |||
2026 and thereafter (Note) | 628 | |||
Total | 637 | |||
Note: | Including the net operating loss carryforwards which may be carried forward indefinitely in the United Kingdom. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Total unrecognized tax benefits at beginning of fiscal year | 1,632 | 1,300 | 1,867 | |||||||||
|
|
|
|
|
| |||||||
Gross amount of increases (decreases) related to positions taken during prior years | (415 | ) | 167 | 224 | ||||||||
Gross amount of increases related to positions taken during the current year | 181 | 409 | 351 | |||||||||
Amount of decreases related to settlements | — | — | — | |||||||||
Foreign exchange translation | (98 | ) | (9 | ) | (97 | ) | ||||||
|
|
|
|
|
| |||||||
Total unrecognized tax benefits at end of fiscal year | 1,300 | 1,867 | 2,345 | |||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Total unrecognized tax benefits at beginning of fiscal year | 1,867 | 2,345 | 12,323 | |||||||||
Gross amount of increases related to positions taken during prior years | 224 | 9,550 | 199 | |||||||||
Gross amount of increases related to positions taken during the current year | 351 | 330 | 328 | |||||||||
Amount of decreases related to settlements | — | — | (9,420 | ) | ||||||||
Foreign exchange translation | (97 | ) | 98 | (56 | ) | |||||||
Total unrecognized tax benefits at end of fiscal year | 2,345 | 12,323 | 3,374 | |||||||||
21.
significant and those plans don’t use significantly different assumptions.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Service cost-benefits earned during the fiscal year | 38,032 | 44,367 | 43,649 | |||||||||
Interest costs on projected benefit obligations | 10,479 | 5,724 | 7,471 | |||||||||
Expected return on plan assets | (40,603 | ) | (35,969 | ) | (34,916 | ) | ||||||
Amortization of prior service cost (benefits) | (195 | ) | (195 | ) | 214 | |||||||
Amortization of net actuarial loss (gain) | (4,108 | ) | 780 | 411 | ||||||||
Special termination benefits | 4,456 | 3,857 | 3,960 | |||||||||
|
|
|
|
|
| |||||||
Net periodic benefit cost | 8,061 | 18,564 | 20,789 | |||||||||
|
|
|
|
|
|
2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Service cost-benefits earned during the fiscal year | 43,649 | 43,698 | 45,697 | |||||||||
Interest costs on projected benefit obligations | 7,471 | 6,933 | 5,590 | |||||||||
Expected return on plan assets | (34,916 | ) | (38,518 | ) | (40,551 | ) | ||||||
Amortization of prior service cost (benefits) | 214 | 152 | 121 | |||||||||
Amortization of net actuarial loss (gain) | 411 | (7,886 | ) | (5,873 | ) | |||||||
Special termination benefits | 3,960 | 2,929 | 9,793 | |||||||||
Net periodic benefit cost | 20,789 | 7,308 | 14,777 | |||||||||
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Net actuarial gain (loss) | 15,645 | 216,777 | ||||||
Amortization of net actuarial loss (gain) | 780 | 411 | ||||||
Prior service benefits (cost) | — | (348 | ) | |||||
Amortization of prior service cost (benefits) | (195 | ) | 214 | |||||
|
|
|
| |||||
Total recognized in other comprehensive income (loss)before-tax | 16,230 | 217,054 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Net actuarial gain (loss) | (21,300 | ) | (169,963 | ) | ||||
Amortization of net actuarial loss (gain) | (7,886 | ) | (5,873 | ) | ||||
Prior service benefits (cost) | (109 | ) | (2,734 | ) | ||||
Amortization of prior service cost (benefits) | 152 | 121 | ||||||
Total recognized in other comprehensive income (loss) before-tax | (29,143 | ) | (178,449 | ) | ||||
2016 | 2017 | 2018 | ||||||||||
Weighted-average assumptions used to determine benefit obligations at fiscal year end: | ||||||||||||
Discount rates | 0.37 | % | 0.47 | % | 0.43 | % | ||||||
Rates of increase in future compensation levels | 1.80-4.80 | % | 1.80-4.80 | % | 1.80-4.80 | % | ||||||
Weighted-average assumptions used to determine net periodic benefit cost during the year: | ||||||||||||
Discount rates | 0.76 | % | 0.37 | % | 0.47 | % | ||||||
Rates of increase in future compensation levels | 2.00-4.80 | % | 1.80-4.80 | % | 1.80-4.80 | % | ||||||
Expected rates of return on plan assets | 1.95 | % | 1.73 | % | 1.58 | % |
2018 | 2019 | 2020 | ||||||||||
Weighted-average assumptions used to determine benefit obligations at fiscal year end: | ||||||||||||
Discount rates | 0.43 | % | 0.34 | % | 0.37 | % | ||||||
Rates of increase in future compensation levels | 1.80-4.80 | % | 1.80-4.80 | % | 1.80-4.80 | % | ||||||
Weighted-average assumptions used to determine net periodic benefit cost during the year: | ||||||||||||
Discount rates | 0.47 | % | 0.43 | % | 0.34 | % | ||||||
Rates of increase in future compensation levels | 1.80-4.80 | % | 1.80-4.80 | % | 1.80-4.80 | % | ||||||
Expected rates of return on plan assets | 1.58 | % | 1.60 | % | 1.68 | % |
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Change in benefit obligations: | ||||||||
Benefit obligations at beginning of fiscal year | 1,495,208 | 1,545,893 | ||||||
Service cost | 44,367 | 43,649 | ||||||
Interest cost | 5,724 | 7,471 | ||||||
Plan participants’ contributions | 1,215 | 1,233 | ||||||
Amendments | — | 348 | ||||||
Actuarial loss (gain) | 67,335 | 30,633 | ||||||
Foreign exchange translation | (2,159 | ) | (32 | ) | ||||
Benefits paid | (51,899 | ) | (53,167 | ) | ||||
Lump-sum payments | (13,898 | ) | (16,672 | ) | ||||
|
|
|
| |||||
Benefit obligations at end of fiscal year | 1,545,893 | 1,559,356 | ||||||
|
|
|
| |||||
Change in plan assets: | ||||||||
Fair value of plan assets at beginning of fiscal year | 2,082,996 | 2,200,812 | ||||||
Actual return (negative return) on plan assets | 118,714 | 280,251 | ||||||
Foreign exchange translation | (3,273 | ) | (113 | ) | ||||
Partial withdrawal of assets from employee retirement benefits trusts(Note) | — | (66,565 | ) | |||||
Employer contributions | 53,059 | 43,279 | ||||||
Plan participants’ contributions | 1,215 | 1,233 | ||||||
Benefits paid | (51,899 | ) | (53,167 | ) | ||||
|
|
|
| |||||
Fair value of plan assets at end of fiscal year | 2,200,812 | 2,405,730 | ||||||
|
|
|
| |||||
Funded status | 654,919 | 846,374 | ||||||
|
|
|
| |||||
Amounts recognized in the consolidated balance sheets consist of: | ||||||||
Prepaid pension cost | 682,592 | 874,191 | ||||||
Accrued pension liability | (27,673 | ) | (27,817 | ) | ||||
|
|
|
| |||||
Net amount recognized | 654,919 | 846,374 | ||||||
|
|
|
| |||||
Amounts recognized in Accumulated other comprehensive income (loss)before-tax consist of: | ||||||||
Prior service benefits (cost) | (1,220 | ) | (1,352 | ) | ||||
Net actuarial gain (loss) | 74,044 | 291,230 | ||||||
|
|
|
| |||||
Net amount recognized | 72,824 | 289,878 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Change in benefit obligations: | ||||||||
Benefit obligations at beginning of fiscal year | 1,559,356 | 1,590,818 | ||||||
Service cost | 43,698 | 45,697 | ||||||
Interest cost | 6,933 | 5,590 | ||||||
Plan participants’ contributions | 1,229 | 1,200 | ||||||
Amendments | 109 | 2,734 | ||||||
Actuarial loss (gain) | 49,085 | 4,507 | ||||||
Foreign exchange translation | (817 | ) | (5,605 | ) | ||||
Benefits paid | (52,618 | ) | (52,902 | ) | ||||
Lump-sum payments | (16,157 | ) | (20,743 | ) | ||||
Benefit obligations at end of fiscal year | 1,590,818 | 1,571,296 | ||||||
Change in plan assets: | ||||||||
Fair value of plan assets at beginning of fiscal year | 2,405,730 | 2,413,556 | ||||||
Actual return (negative return) on plan assets | 66,652 | (125,549 | ) | |||||
Foreign exchange translation | (390 | ) | (4,268 | ) | ||||
Partial withdrawal of assets from employee retirement benefits trusts (Note) | (27,534 | ) | — | |||||
Employer contributions | 20,487 | 20,587 | ||||||
Plan participants’ contributions | 1,229 | 1,200 | ||||||
Benefits paid | (52,618 | ) | (52,902 | ) | ||||
Fair value of plan assets at end of fiscal year | 2,413,556 | 2,252,624 | ||||||
Funded status | 822,738 | 681,328 | ||||||
Amounts recognized in the consolidated balance sheets consist of: | ||||||||
Prepaid pension cost | 850,472 | 711,981 | ||||||
Accrued pension liability | (27,734 | ) | (30,653 | ) | ||||
Net amount recognized | 822,738 | 681,328 | ||||||
Amounts recognized in Accumulated other comprehensive income (loss) before-tax consist of: | ||||||||
Prior service benefits (cost) | (1,309 | ) | (3,914 | ) | ||||
Net actuarial gain (loss) | 262,044 | 86,200 | ||||||
Net amount recognized | 260,735 | 82,286 | ||||||
Note: | During the fiscal year ended March 31, |
In the fiscal year ended March 31, 2017, the Group incorporated employee-level improvements in the mortality indicators used in the pension benefit calculation, which resulted in an increase of the benefit obligations of ¥79,861 million.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Plans with projected benefit obligations in excess of plan assets: | ||||||||
Projected benefit obligations | 57,980 | 59,319 | ||||||
Fair value of plan assets | 30,306 | 31,503 | ||||||
Plans with accumulated benefit obligations in excess of plan assets: | ||||||||
Accumulated benefit obligations | 56,125 | 59,319 | ||||||
Fair value of plan assets | 30,306 | 31,503 |
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Plans with projected benefit obligations in excess of plan assets: | ||||||||
Projected benefit obligations | 61,579 | 63,619 | ||||||
Fair value of plan assets | 33,845 | 32,966 | ||||||
Plans with accumulated benefit obligations in excess of plan assets: | ||||||||
Accumulated benefit obligations | 61,579 | 63,619 | ||||||
Fair value of plan assets | 33,845 | 32,966 |
Note: | The plans with projected benefit obligations in excess of plan assets include those with accumulated benefit obligations in excess of plan assets. |
the sufficient funds will be available to plan participants and beneficiaries. Generally, the investment returns are relative to the risks involved. In considering the maximum levels of risk that the MHFG Group can assume, it primarily considers the following factors;factors: the employers’ burden of maintaining the benefit plans based on the design of the plans and future plan contributions, the age distribution of the plan participants and beneficiaries, the financial conditions of the employers, and the employers’ ability to absorb future variability in plan premiums. The long-term asset allocation to each asset category such as Japanese equity securities, Japanese debt securities, foreign equity securities and foreign debt securities is determined based upon the optimal portfolio, which is estimated to yield the maximum return within the range of an acceptable level of risk. Additionally, the asset allocation is reviewed whenever there are large fluctuations in pension plan liabilities caused by modifications of pension plans, or there are changes in the market environment. When selecting an investment in each asset category, the MHFG Group takes into consideration credit standing of an investee, concentration of credit risk to a certain investee and liquidity of a financial instrument among other things. The investments in each asset category are further diversified across funds, strategies and sectors along with other things. There is no significant investment in a single investee except Japanese government bonds.
| ||||
| ||||
Asset category | Asset ratio | |||
Japanese | 5.00 | % | ||
Japanese debt securities | 34.00 | % | ||
Foreign | 25.00 | % | ||
Foreign debt securities | 23.00 | % | ||
General account of life insurance companies | 11.00 | % | ||
Other | 2.00 | % | ||
| ||||
Total | 100.00 | % | ||
Note: | General account of life insurance companies is a contract with life insurance companies which guarantees payments of principal and predetermined interest |
(in billions of yen) Japanese equity securities: Common stocks(1) Pooled funds(2) Japanese debt securities: Government bonds Pooled funds(2) Other Foreign equity securities: Common stocks Pooled funds(2) Foreign debt securities: Government bonds Pooled funds(2) Other General account of life insurance companies (3) Other Plan assets measured at net asset value (5) Total assets at fair value value.”20172019 and 2018,2020, by asset class. For the detailed information on fair value measurements, including descriptions of Level 1, 2 and 3 of the fair value hierarchy and the valuation methodologies, see Note 2827 “Fair value”. 2017 2018 Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total 1,162 — — 1,162 1,330 — — 1,330 10 — — 10 10 9 — 19 254 — — 254 184 — — 184 — 2 — 2 — 4 — 4 — 25 — 25 — 25 — 25 111 — — 111 108 — — 108 — 2 — 2 — 5 — 5 68 3 — 71 175 6 — 181 — 7 — 7 — 9 — 9 — 16 — 16 — 16 — 16 — 124 — 124 — 110 — 110 78 (4) 1 — 79 92 (4) — — 92 338 323 1,683 180 — 2,201 1,899 184 — 2,406 (4) (4)
(1) | This class represents equity securities held in the employee retirement benefit trusts of |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(2) | These classes primarily include pension investment fund trusts. Investments in these classes are generally measured at fair value and can be redeemed within a short-term period upon request. |
(3) | Investments in this class are measured at conversion value, which is equivalent to fair value. |
(4) | Amounts primarily include cash and short-term assets carried at fair value. |
(5) | In accordance with ASC 820, certain plan assets that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. |
2020.
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2019 | 67,291 | |||
2020 | 69,087 | |||
2021 | 70,332 | |||
2022 | 71,041 | |||
2023 | 71,662 | |||
2024-2028 | 353,649 |
22.
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2021 | 70,325 | |||
2022 | 70,623 | |||
2023 | 71,165 | |||
2024 | 72,469 | |||
2025 | 73,118 | |||
2026-2030 | 346,908 |
Number of shares | Weighted-average exercise price | Weighted-average remaining contractual term | Aggregate intrinsic value | |||||||||||||
(in yen) | (in years) | (in millions of yen) | ||||||||||||||
Outstanding at beginning of fiscal year | 10,819,000 | 1 | ||||||||||||||
Exercised during fiscal year | 3,603,000 | 1 | ||||||||||||||
|
| |||||||||||||||
Outstanding at end of fiscal year | 7,216,000 | 1 | 15.36 | 1,374 | ||||||||||||
|
| |||||||||||||||
Exercisable at end of fiscal year | — | — | — | — | ||||||||||||
|
|
2020:
Number of shares | Weighted-average exercise price | Weighted-average remaining contractual term | Aggregate intrinsic value | |||||||||||||
(in yen) | (in years) | (in millions of yen) | ||||||||||||||
Outstanding at beginning of fiscal year | 4,245,000 | 1 | ||||||||||||||
Exercised during fiscal year | 2,968,000 | 1 | ||||||||||||||
Outstanding at end of fiscal year | 1,277,000 | 1 | 13.91 | 157 | ||||||||||||
Exercisable at end of fiscal year | — | — | — | — | ||||||||||||
2020.
Performance-based stock
programs
Number of shares | Weighted-average grant-date fair value | |||||||
(per share in yen) | ||||||||
Outstanding as of March 31, 2017 | 9,000,000 | 158.68 | ||||||
Granted during fiscal year | 8,130,000 | 196.94 | ||||||
Vested during fiscal year | 3,810,594 | 158.68 | ||||||
Forfeited during fiscal year | — | — | ||||||
Outstanding as of March 31, 2018 | 13,319,406 | 182.04 | ||||||
|
|
|
|
The weighted average grant date fair value of the performance-based stock compensationprograms for the fiscal years ended March 31, 20172019 and 2018 were ¥158.68 and ¥196.94, respectively.
2020:
Stock Compensation I | Stock Compensation II | |||||||||||||||
2019 | Number of shares | Weighted-average grant-date fair value | Number of shares | Weighted-average grant-date fair value | ||||||||||||
(per share in yen) | (per share in yen) | |||||||||||||||
Nonvested at the beginning of the year | — | — | 13,319,406 | 182.04 | ||||||||||||
Granted during fiscal year | 3,770,065 | 189.24 | 6,906,635 | 189.24 | ||||||||||||
Vested during fiscal year | 3,770,065 | 189.24 | 5,068,949 | 187.48 | ||||||||||||
Forfeited during fiscal year | — | — | — | — | ||||||||||||
Nonvested at the end of the year | — | — | 15,157,092 | 183.50 | ||||||||||||
Stock Compensation I | Stock Compensation II | |||||||||||||||
2020 | Number of shares | Weighted-average grant-date fair value | Number of shares | Weighted-average grant-date fair value | ||||||||||||
(per share in yen) | (per share in yen) | |||||||||||||||
Nonvested at the beginning of the year | — | — | 15,157,092 | 183.50 | ||||||||||||
Granted during fiscal year | 5,748,997 | 159.59 | 3,281,003 | 159.59 | ||||||||||||
Vested during fiscal year | 5,748,997 | 159.59 | 7,014,809 | 182.07 | ||||||||||||
Forfeited during fiscal year | — | — | — | — | ||||||||||||
Nonvested at the end of the year | — | — | 11,423,286 | 177.51 | ||||||||||||
The shares of MHFG common stock were acquired from the stock market by the trustee by using the money entrusted to the Compensation Committee. The total amount of the common stock was ¥2,425 million.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The compensation cost with regard to the performance-based stock compensation is determined based upon the fair value of shares of MHFG common stock as of grant date and is recognized over three year deferral period on a straight-line basis. The compensation cost recognized in this performance-based stock compensation program for the fiscal years ended March 31, 20172019 and 2018 were ¥354 million2020:
2019 | 2020 | |||||||||||||||
Stock Compensation I | Stock Compensation II | Stock Compensation I | Stock Compensation II | |||||||||||||
(in millions of yen) | ||||||||||||||||
Fair value of vested shares | 713 | 930 | 917 | 1,090 | ||||||||||||
Common stock shares acquired | 713 | 1,307 | 917 | 524 |
AsII, the liability related to the cash-based compensation cost is remeasured at each reporting date based on the fair value of MHFG’s common stock. For Stock Compensation II, the stock-based compensation costs are recognized evenly over the graded-vesting period, which is three years. For Stock Compensation I, as the program is effectively vested on the grant date, the stock-based compensation cost is recognized on the grant date. The following table presents the compensation cost recognized in the stock compensation programs for the fiscal yearyears ended March 31, 2018, 2019 and 2020:
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Stock Compensation I | — | 713 | 917 | |||||||||
Stock Compensation II | 868 | 1,287 | 1,247 |
23.1.56 years as of the fiscal year ended March 31, 2020.
Fair value | ||||||||||||||||||||
Derivative receivables (2) | Derivative payables (2) | |||||||||||||||||||
2017 | Notional amount (1) | Designated as hedges | Not designated as hedges | Designated as hedges | Not designated as hedges | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Interest rate contracts | 961,518 | — | 8,506 | — | 8,473 | |||||||||||||||
Foreign exchange contracts | 167,698 | 2 | 2,743 | — | 2,611 | |||||||||||||||
Equity-related contracts | 4,177 | — | 134 | 5 | 224 | |||||||||||||||
Credit-related contracts | 3,696 | — | 35 | — | 36 | |||||||||||||||
Other contracts | 360 | — | 23 | — | 22 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 1,137,449 | 2 | 11,441 | 5 | 11,366 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
Fair value | ||||||||||||||||||||
Derivative receivables (2) | Derivative payables (2) | |||||||||||||||||||
2019 | Notional amount (1) | Designated as hedges | Not designated as hedges | Designated as hedges | Not designated as hedges | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Interest rate contracts | 1,052,267 | — | 5,786 | — | 5,610 | |||||||||||||||
Foreign exchange contracts | 166,383 | — | 1,959 | — | 1,758 | |||||||||||||||
Equity-related contracts | 5,181 | — | 125 | — | 142 | |||||||||||||||
Credit-related contracts | 2,939 | — | 18 | — | 17 | |||||||||||||||
Other contracts | 438 | — | 16 | — | 14 | |||||||||||||||
Total | 1,227,208 | — | 7,904 | — | 7,541 | |||||||||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Fair value | ||||||||||||||||||||
Derivative receivables (2) | Derivative payables (2) | |||||||||||||||||||
2018 | Notional amount (1) | Designated as hedges | Not designated as hedges | Designated as hedges | Not designated as hedges | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Interest rate contracts | 1,004,169 | — | 7,176 | — | 7,143 | |||||||||||||||
Foreign exchange contracts | 155,832 | 2 | 2,695 | — | 2,382 | |||||||||||||||
Equity-related contracts | 6,189 | — | 197 | 9 | 142 | |||||||||||||||
Credit-related contracts | 2,708 | — | 18 | — | 21 | |||||||||||||||
Other contracts | 335 | — | 23 | — | 19 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 1,169,233 | 2 | 10,109 | 9 | 9,707 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
Fair value | ||||||||||||||||||||
Derivative receivables (2) | Derivative payables (2) | |||||||||||||||||||
2020 | Notional amount (1) | Designated as hedges | Not designated as hedges | Designated as hedges | Not designated as hedges | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Interest rate contracts | 1,123,546 | — | 7,232 | — | 6,788 | |||||||||||||||
Foreign exchange contracts | 185,359 | — | 2,926 | — | 2,899 | |||||||||||||||
Equity-related contracts | 6,684 | — | 310 | — | 266 | |||||||||||||||
Credit-related contracts | 4,676 | — | 30 | — | 29 | |||||||||||||||
Other contracts | 400 | — | 38 | — | 39 | |||||||||||||||
Total | 1,320,665 | — | 10,536 | — | 10,021 | |||||||||||||||
(1) | Notional amount includes the sum of gross long and gross short third-party contracts. |
(2) | Derivative receivables and payables are recorded in Trading account assets and Trading account liabilities, respectively. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Gains (losses) recorded in income | ||||||||||||||||
2016 | Derivatives | Hedged items | Hedge ineffectiveness | Net gain (loss) excluded from assessment of effectiveness | ||||||||||||
(in millions of yen) | ||||||||||||||||
Equity-related contracts | 14,623 | (18,224 | ) | — | (3,601 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 14,623 | (18,224 | ) | — | (3,601 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Gains (losses) recorded in income | ||||||||||||||||
2017 | Derivatives | Hedged items | Hedge ineffectiveness | Net gain (loss) excluded from assessment of effectiveness | ||||||||||||
(in millions of yen) | ||||||||||||||||
Equity-related contracts | (14,747 | ) | 11,393 | — | (3,354 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | (14,747 | ) | 11,393 | — | (3,354 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Gains (losses) recorded in income | ||||||||||||||||
2018 | Derivatives | Hedged items | Hedge ineffectiveness | Net gain (loss) excluded from assessment of effectiveness | ||||||||||||
(in millions of yen) | ||||||||||||||||
Equity-related contracts | (23,832 | ) | 19,631 | — | (4,201 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | (23,832 | ) | 19,631 | — | (4,201 | ) | ||||||||||
|
|
|
|
|
|
|
|
Gains (losses) recorded in income | ||||||||||||||||
2018 | Derivatives | Hedged items | Hedge ineffectiveness | Net gain (loss) excluded from assessment of effectiveness | ||||||||||||
(in millions of yen) | ||||||||||||||||
Equity-related contracts | (23,832 | ) | 19,631 | — | (4,201 | ) | ||||||||||
Total | (23,832 | ) | 19,631 | — | (4,201 | ) | ||||||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Gains (losses) recorded in income and other comprehensive income (“OCI”) | ||||||||||||||||||||||||
2016 | 2017 | 2018 | ||||||||||||||||||||||
Effective portion recorded in OCI | Ineffective portion recorded in income | Effective portion recorded in OCI | Ineffective portion recorded in income | Effective portion recorded in OCI | Ineffective portion recorded in income | |||||||||||||||||||
(in millions of yen) | ||||||||||||||||||||||||
Financial instruments hedging foreign exchange risk | 46,697 | 696 | 16,767 | 47 | (30 | ) | 90 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 46,697 | 696 | 16,767 | 47 | (30 | ) | 90 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Gains (losses) recorded in other comprehensive income (“OCI”) | ||||||||||||
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Financial instruments hedging foreign exchange risk | 60 | 7,512 | 418 | |||||||||
Total | 60 | 7,512 | 418 | |||||||||
Note: | Related to the |
(in millions of yen) Interest rate contracts Foreign exchange contracts Equity-related contracts(1) Credit-related contracts(2) Other contracts Total 2020:hedging strategies: (1) interest-rate swap transactions for the purpose of hedgingeconomically managing the interest-rate risks in deposits, loans etc., (2) currency swap transactions for the purpose of hedgingeconomically managing the foreign exchange risk of these assets, and (3) credit derivatives for the purpose of hedgingeconomically managing the credit risk in loans, residential mortgage-backed securities (“RMBS”), commercial mortgage-backed securities (“CMBS”), collateralized loan obligations (“CLO”) and other similar assets. Such derivatives are accounted for as trading positions. The changes in fair value of these instruments are primarily recorded in Trading account gains (losses)—net, even though they are used to mitigate or transform the risk of exposures arising from banking activities. The net gain (loss)gains (losses) resulting from changes in the fair value of certain credit derivatives where the Group purchases protection to mitigate its credit risk exposure, related to its corporate loan portfolio, is recorded in Other noninterest income (expenses).2016, 20172018, 2019 and 2018: Gains (losses) recorded in income 2016 2017 2018 319,225 (209,361 ) (63,260 ) 65,101 37,129 61,046 21,571 5,131 (94,607 ) (6,960 ) (6,694 ) (2,830 ) 2,015 742 6,330 400,952 (173,053 ) (93,321 ) ) ) ) ) ) ) ) ) (1) The net gain (loss)gains (losses) excluded from the assessment of the effectiveness of fair value hedges is not included in the above table.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
(2) | Amounts include the net ) million, ) million and |
2017 | 2018 | |||||||||||||||
Notional amount | Fair value | Notional amount | Fair value | |||||||||||||
(in billions of yen) | ||||||||||||||||
Credit protection written: | ||||||||||||||||
Investment grade | 1,546 | 21 | 1,105 | 15 | ||||||||||||
Non-investment grade | 298 | 1 | 197 | 4 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total | 1,844 | 22 | 1,302 | 19 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Credit protection purchased | 1,994 | (23 | ) | 1,541 | (22 | ) | ||||||||||
|
|
|
|
|
|
|
|
2019 | 2020 | |||||||||||||||
Notional amount | Fair value | Notional amount | Fair value | |||||||||||||
(in billions of yen) | ||||||||||||||||
Credit protection written: | ||||||||||||||||
Investment grade | 1,266 | 12 | 1,400 | (5 | ) | |||||||||||
Non-investment grade | 199 | 3 | 416 | — | ||||||||||||
Total | 1,465 | 15 | 1,816 | (5 | ) | |||||||||||
Credit protection purchased | 1,628 | (14 | ) | 3,028 | 6 | |||||||||||
Note: | The rating scale is based upon either the external ratings or the internal ratings of the underlying reference credit. The lowest investment grade rating is considered to be BBB - , while anything below or unrated is considered to benon-investment grade.Non-investment grade credit derivatives primarily consist of unrated credit default swap indices such as CDX and iTraxx. |
Maximum payout/Notional amount | ||||||||
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
One year or less | 507 | 329 | ||||||
After one year through five years | 1,020 | 831 | ||||||
After five years | 317 | 142 | ||||||
|
|
|
| |||||
Total | 1,844 | 1,302 | ||||||
|
|
|
|
Maximum payout/Notional amount | ||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
One year or less | 326 | 270 | ||||||
After one year through five years | 1,057 | 1,368 | ||||||
After five years | 82 | 178 | ||||||
Total | 1,465 | 1,816 | ||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Note: | The maximum potential amount of future payments is the aggregate notional amount of the credit derivatives where the Group wrote the credit protection, and it has not been reduced by the effect of any amounts that the Group may possibly collect on the underlying assets and the related cash flows, nor netted against that of credit protection purchased. |
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
Aggregate fair value of derivative instruments with credit-risk-related contingent features in net liability positions | 698 | 572 | ||||||
Collateral provided to counterparties in the normal course of business | 658 | 593 | ||||||
Amount required to be posted as collateral or settled immediately if credit-risk-related contingent features were triggered(Note) | 40 | — |
24.2020:
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Aggregate fair value of derivative instruments with credit-risk-related contingent features in net liability positions | 511 | 888 | ||||||
Collateral provided to counterparties in the normal course of business | 489 | 818 | ||||||
Amount required to be posted as collateral or settled immediately if credit-risk-related contingent features were triggered | 22 | 70 |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Carrying amount
Maximum exposure under guarantee contracts
2017 | Maximum potential/Contractual or Notional amount | Amount by expiration period | ||||||||||||||
One year or less | After one year through five years | After five years | ||||||||||||||
(in billions of yen) | ||||||||||||||||
Performance guarantees | 2,243 | 1,246 | 828 | 169 | ||||||||||||
Guarantees on loans | 278 | 147 | 20 | 111 | ||||||||||||
Guarantees on securities | 175 | 37 | 138 | — | ||||||||||||
Other guarantees | 1,823 | 1,246 | 513 | 64 | ||||||||||||
Guarantees for the repayment of trust principal | 730 | 654 | 52 | 24 | ||||||||||||
Liabilities of trust accounts | 15,177 | 14,927 | 82 | 168 | ||||||||||||
Derivative financial instruments | 14,415 | 6,066 | 6,603 | 1,746 |
2019 | Maximum potential/Contractual or Notional amount | Amount by expiration period | ||||||||||||||
One year or less | After one year through five years | After five years | ||||||||||||||
(in billions of yen) | ||||||||||||||||
Performance guarantees | 2,307 | 1,265 | 878 | 164 | ||||||||||||
Guarantees on loans | 289 | 164 | 46 | 79 | ||||||||||||
Guarantees on securities | 145 | 91 | 54 | — | ||||||||||||
Other guarantees | 2,324 | 1,447 | 834 | 43 | ||||||||||||
Guarantees for the repayment of trust principal | 65 | — | 47 | 18 | ||||||||||||
Liabilities of trust accounts | 362 | 61 | 148 | 153 | ||||||||||||
Derivative financial instruments | 14,170 | 5,807 | 6,434 | 1,929 |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2018 | Maximum potential/Contractual or Notional amount | Amount by expiration period | ||||||||||||||
One year or less | After one year through five years | After five years | ||||||||||||||
(in billions of yen) | ||||||||||||||||
Performance guarantees | 2,165 | 1,084 | 908 | 173 | ||||||||||||
Guarantees on loans | 241 | 123 | 28 | 90 | ||||||||||||
Guarantees on securities | 164 | 32 | 132 | — | ||||||||||||
Other guarantees | 2,210 | 1,555 | 614 | 41 | ||||||||||||
Guarantees for the repayment of trust principal | 709 | 639 | 49 | 21 | ||||||||||||
Liabilities of trust accounts | 13,861 | 13,546 | 149 | 166 | ||||||||||||
Derivative financial instruments | 11,654 | 4,911 | 4,996 | 1,747 |
2020 | Maximum potential/Contractual or Notional amount | Amount by expiration period | ||||||||||||||
One year or less | After one year through five years | After five years | ||||||||||||||
(in billions of yen) | ||||||||||||||||
Performance guarantees | 2,456 | 1,511 | 735 | 210 | ||||||||||||
Guarantees on loans | 301 | 204 | 34 | 63 | ||||||||||||
Guarantees on securities | 110 | 22 | 88 | — | ||||||||||||
Other guarantees | 2,314 | 1,925 | 319 | 70 | ||||||||||||
Guarantees for the repayment of trust principal | 59 | — | 42 | 17 | ||||||||||||
Liabilities of trust accounts | 446 | 80 | 201 | 165 | ||||||||||||
Derivative financial instruments | 21,756 | 11,045 | 7,951 | 2,760 |
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
Investment grade | 3,477 | 3,930 | ||||||
Non-investment grade | 1,042 | 850 | ||||||
|
|
|
| |||||
Total | 4,519 | 4,780 | ||||||
|
|
|
|
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Investment grade | 4,124 | 4,233 | ||||||
Non-investment grade | 941 | 948 | ||||||
Total | 5,065 | 5,181 | ||||||
Note: | Investment grade in the internal rating scale generally corresponds to BBB- or above in the external rating scale. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2017 | 2018 | |||||||
(in billions of yen) | ||||||||
Commitments to extend credit(Note) | 76,678 | 78,448 | ||||||
Commercial letters of credit | 522 | 690 | ||||||
|
|
|
| |||||
Total | 77,200 | 79,138 | ||||||
|
|
|
|
2020:
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Commitments to extend credit (Note) | 76,857 | 76,633 | ||||||
Commercial letters of credit | 778 | 690 | ||||||
Total | 77,635 | 77,323 | ||||||
Leases
The MHFG Group leases certain office space and equipment under noncancelable agreements. The lease periods for these leases range from less than 1 year to around 30 years. These leases include cancellation clauses with penalties
During prior years, the MHFG Group’s major banking subsidiaries sold their head offices (including land, buildings, facilities
Legal proceedings
investigations
The Group’s Indonesian subsidiary acts as In accordance with ASC 450, the collateral agentGroup recognizes a liability for loss contingencies arising from such proceedings and investigations when a loss is probable and the trustee of bond issuances made by subsidiaries of Asia Pulp & Paper Company Ltd. (“APP”). In that role,loss amount or the subsidiary is involved in a dispute between the bondholders and such APP subsidiaries in their capacities as the issuers, guarantors and/or pledgors of security for the bonds relating to foreclosure proceedings in respectrange of the collateral and the subsidiary has been named asloss can be reasonably estimated. If a defendant in a lawsuit brought by the obligors under the bonds in Indonesia. The Group’s consolidated financial statements doloss does not include a reserve in relation tomeet this dispute andcondition but is reasonably possible, the Group does not believerecognize a liability but discloses the detail of such proceedings and investigations. Based on the information available as of the date of the consolidated financial statements, the Group believes that the resolutionoutcome of this matterthe collection, legal proceedings and investigations will not have a significant impactadverse effect on the consolidated financial condition or resultsstatements.
As of March 31, 2020 | ||||
(in millions of yen, except for remaining lease term and discount rate) | ||||
ROU assets (Note) | 613,068 | |||
Lease liabilities (Note) | 627,250 | |||
Weighted average: | ||||
Remaining lease term | 15.7 | years | ||
Discount rate | 0.55 | % |
Note: | ROU assets and lease liabilities are included in Other assets and Other liabilities, respectively, on the consolidated balance sheets. |
25.fiscal year ended March 31, 2020:
Fiscal year ended March 31, 2020 | ||||
(in millions of yen) | ||||
Lease cost (Note) | 126,840 | |||
ROU assets obtained in exchange for new lease liabilities | 60,047 | |||
Operating cash flows | 102,066 |
Note: | Lease cost for operating leases are included in Occupancy expenses on the consolidated statements of income. The Group’s variable lease costs and costs for leases with terms of twelve months or less are not significant. Total rental expense for the fiscal years ended March 31, 2018 and 2019 prior to the adoption of ASU No.2016-02 was ¥117,270 million and ¥115,239 million, respectively. |
As of March 31, 2020 | ||||
(in millions of yen) | ||||
Fiscal year ending March 31: | ||||
2021 | 93,997 | |||
2022 | 68,268 | |||
2023 | 54,377 | |||
2024 | 47,608 | |||
2025 | 41,539 | |||
2026 and thereafter | 346,741 | |||
Total lease payments | 652,530 | |||
Amount representing interest | 25,280 | |||
Total lease liabilities for operating leases | 627,250 | |||
Consolidated VIEs | Significant unconsolidated VIEs | |||||||||||
2017 | Consolidated assets | Total assets | Maximum exposure to loss | |||||||||
(in billions of yen) | ||||||||||||
Asset-backed commercial paper/loan programs | 2,031 | — | — | |||||||||
Asset-backed securitizations | 629 | 108 | 11 | |||||||||
Investments in securitization products | 375 | 445 | 154 | |||||||||
Investment funds | 2,188 | 3,895 | 463 | |||||||||
Trust arrangements and other | 23 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | 5,246 | 4,448 | 628 | |||||||||
|
|
|
|
|
|
Consolidated VIEs | Significant unconsolidated VIEs | |||||||||||
2018 | Consolidated assets | Total assets | Maximum exposure to loss | |||||||||
(in billions of yen) | ||||||||||||
Asset-backed commercial paper/loan programs | 2,185 | — | — | |||||||||
Asset-backed securitizations | 627 | 78 | 5 | |||||||||
Investments in securitization products | 374 | — | — | |||||||||
Investment funds | 2,661 | 1,891 | 533 | |||||||||
Trust arrangements and other | 21 | — | — | |||||||||
|
|
|
|
|
| |||||||
Total | 5,868 | 1,969 | 538 | |||||||||
|
|
|
|
|
|
2020:
Consolidated VIEs | Significant unconsolidated VIEs | |||||||||||
2019 | Consolidated assets | Total assets | Maximum exposure to loss | |||||||||
(in billions of yen) | ||||||||||||
Asset-backed commercial paper/loan programs | 2,249 | — | — | |||||||||
Asset-backed securitizations | 571 | 70 | 8 | |||||||||
Investments in securitization products | 372 | — | — | |||||||||
Investment funds | 2,836 | 1,280 | 410 | |||||||||
Trust arrangements and other | 20 | — | — | |||||||||
Total | 6,048 | 1,350 | 418 | |||||||||
Consolidated VIEs | Significant unconsolidated VIEs | |||||||||||
2020 | Consolidated assets | Total assets | Maximum exposure to loss | |||||||||
(in billions of yen) | ||||||||||||
Asset-backed commercial paper/loan programs | 2,160 | — | — | |||||||||
Asset-backed securitizations | 572 | 77 | 7 | |||||||||
Investments in securitization products | 370 | — | — | |||||||||
Investment funds | 2,694 | 2,299 | 514 | |||||||||
Trust arrangements and other | 19 | — | — | |||||||||
Total | 5,815 | 2,376 | 521 | |||||||||
Assets on balance sheets related to unconsolidated VIEs: | 2017 | 2018 | ||||||
(in billions of yen) | ||||||||
Trading account assets | 85 | 89 | ||||||
Investments | 254 | 210 | ||||||
Loans | 237 | 163 | ||||||
|
|
|
| |||||
Total | 576 | 462 | ||||||
|
|
|
|
Liabilities on balance sheets and maximum exposure to loss related to unconsolidated VIEs: | 2017 | 2018 | ||||||
(in billions of yen) | ||||||||
Payables under securities lending transactions | 31 | 38 | ||||||
Trading account liabilities | 1 | 1 | ||||||
|
|
|
| |||||
Total | 32 | 39 | ||||||
|
|
|
| |||||
Maximum exposure to loss(Note) | 628 | 538 | ||||||
|
|
|
|
Assets on balance sheets related to unconsolidated VIEs: | 2019 | 2020 | ||||||
(in billions of yen) | ||||||||
Trading account assets | 104 | 108 | ||||||
Investments | 168 | 267 | ||||||
Loans | 71 | 55 | ||||||
Total | 343 | 430 | ||||||
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Liabilities on balance sheets and maximum exposure to loss related to unconsolidated VIEs: | 2019 | 2020 | ||||||
(in billions of yen) | ||||||||
Payables under securities lending transactions | 47 | 47 | ||||||
Trading account liabilities | 1 | 2 | ||||||
Total | 48 | 49 | ||||||
Maximum exposure to loss (Note) | 418 | 521 | ||||||
Note: | This represents the maximum amount the Group could possibly be required to record in its consolidated statements of income associated with on-balance-sheet exposures andoff-balance-sheet liabilities such as undrawn commitments. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
The MHFG Group has started Tender Option Bond (“TOB”) programs in the fiscal year ended March 31, 2020, which is associated with trusts that hold highly-rated, fixed-rate and
Prior to April 1, 2016, the Group determined that certain investment funds managed by the Group that had attributes of an investment company (or similar entity) qualified for the deferral from certain requirements of ASC 810 that originated from Statement of Financial Accounting Standards (“SFAS”) No.167 “Amendments to FASB Interpretation No.46(R)” (“SFAS No.167”). For these funds, the Group determined whether it was the primary beneficiary by evaluating whether it absorbed the majority of expected losses, received the majority of expected residual returns, or both.
On April 1, 2016, the Group adopted ASU No.2015-02 which eliminated the deferral.
Upon the adoption of ASU No.2015-02, the The Group newly consolidatedconsolidates certain investment funds that had not been consolidated priorwhere it is deemed to April 1, 2016, which hadbe the impact of increasing total assets primarily consisting of Trading account assets by ¥16 billion, and noncontrolling interests by ¥16 billion, respectively. On the other hand, the Group deconsolidated certain investment funds that had been consolidated prior to April 1, 2016, which had the impact of decreasing total assets by ¥54 billion, total liabilities by ¥27 billion, and noncontrolling interests by ¥27 billion, respectively. In addition, the Group determined that certain limited partnerships and similar entities that had been voting interest entities prior to April 1, 2016 are significant unconsolidated VIEs. The amounts relating to significant unconsolidated VIEs as of March 31, 2017 and 2018 in the tables above include the amounts of these limited partnerships and similar entities.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
In these cases, the MHFG Group consider that these variable interests are not significant other than specific involvements such as followings;
2020.
Therefore the Group does not consolidate such VIEs.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
securitization transactions, the Group records the transfer of a financial asset as a sale when all the accounting criteria for a sale under ASC
860 are met. These criteria are (1) the transferred financial assets are legally isolated from the Group’s creditors, (2) the transferee or beneficial interest holder has the right to pledge or exchange the transferred financial assets, and (3) the Group does not maintain effective control over the transferred financial assets. If all the criteria are not met, the transfer is accounted for as a secured borrowing.2020.
26. Fee and commission
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Securities-related business | 175,723 | 165,857 | 180,122 | |||||||||
Deposits and lending business | 143,763 | 164,573 | 156,426 | |||||||||
Remittance business | 109,859 | 108,368 | 110,054 | |||||||||
Asset management business | 61,803 | 79,426 | 100,765 | |||||||||
Trust fees | 50,496 | 47,379 | 51,868 | |||||||||
Fees for other customer services | 263,112 | 260,360 | 266,476 | |||||||||
|
|
|
|
|
| |||||||
Total | 804,756 | 825,963 | 865,711 | |||||||||
|
|
|
|
|
|
Securities-related
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Fee and commission income: | ||||||||||||
Securities-related business (1) | 180,122 | 145,270 | 139,124 | |||||||||
Deposits and lending business (2) | 156,426 | 152,283 | 157,420 | |||||||||
Remittance business (1) | 110,054 | 110,382 | 112,275 | |||||||||
Asset management business (1) | 100,765 | 97,852 | 98,720 | |||||||||
Trust related business (1) | 121,808 | 124,843 | 129,298 | |||||||||
Agency business (1) | 37,397 | 36,466 | 31,879 | |||||||||
Guarantee related business (3) | 28,258 | 28,582 | 28,974 | |||||||||
Fees for other customer services (1) | 130,881 | 157,612 | 170,195 | |||||||||
Total Fee and commission income | 865,711 | 853,290 | 867,885 | |||||||||
Foreign exchange gains (losses)—net (3) | 91,793 | 93,577 | 44,345 | |||||||||
Trading account gains (losses)—net (2) | 236,982 | 328,841 | 745,692 | |||||||||
Investment gains (losses)—net: | ||||||||||||
Debt securities (3) | 7,757 | (3,842 | ) | 31,032 | ||||||||
Equity securities (3) | 289,400 | (155,947 | ) | (557,391 | ) | |||||||
Equity in earnings (losses) of equity method investees—net (3) | 24,342 | 29,172 | 34,012 | |||||||||
Gains on disposal of premises and equipment (3) | 8,225 | 5,145 | 2,583 | |||||||||
Other noninterest income (2) (4) | 80,453 | 72,135 | 139,582 | |||||||||
Total | 1,604,663 | 1,222,371 | 1,307,740 | |||||||||
(1) | These amounts are revenues from contracts within the scope of ASC 606, “Revenue from contracts with customers ” (“ASC 606”). |
(2) | Part of these amounts are considered to be revenues from contracts that are within the scope of ASC 606. |
(3) | These amounts are revenues from contracts that do not meet the scope of ASC 606. |
(4) | These amounts include the net unrealized gains resulting from changes in fair values of structured notes that contain embedded derivatives. See Note 27 “Fair value” for further details. |
27.
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Trading account gains (losses)—net: | ||||||||||||
Trading securities | 156,559 | 126,332 | 333,749 | |||||||||
Derivative contracts: | ||||||||||||
Interest rate contracts | 319,225 | (209,361 | ) | (63,260 | ) | |||||||
Foreign exchange contracts(1) | 65,101 | 37,129 | 61,046 | |||||||||
Equity-related contracts(2) | 17,970 | 1,777 | (98,807 | ) | ||||||||
Credit-related contracts(3) | (1,731 | ) | 900 | (2,076 | ) | |||||||
Other contracts | 2,015 | 742 | 6,330 | |||||||||
|
|
|
|
|
| |||||||
Total | 559,139 | (42,481 | ) | 236,982 | ||||||||
Foreign exchange gains (losses)—net(4) | 113,553 | 69,453 | 91,793 | |||||||||
|
|
|
|
|
| |||||||
Net trading gains (losses) | 672,692 | 26,972 | 328,775 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Trading account gains (losses)—net: | ||||||||||||
Trading securities | 333,749 | 158,162 | 267,514 | |||||||||
Derivative contracts: | ||||||||||||
Interest rate contracts | (63,260 | ) | 127,242 | 388,289 | ||||||||
Foreign exchange contracts (1) | 61,046 | 6,748 | (111,920 | ) | ||||||||
Equity-related contracts (2) | (98,807 | ) | 37,875 | 217,744 | ||||||||
Credit-related contracts (3) | (2,076 | ) | 269 | 5,208 | ||||||||
Other contracts | 6,330 | (1,455 | ) | (21,143 | ) | |||||||
Total | 236,982 | 328,841 | 745,692 | |||||||||
Foreign exchange gains (losses)—net (4) | 91,793 | 93,577 | 44,345 | |||||||||
Net trading gains (losses) | 328,775 | 422,418 | 790,037 | |||||||||
(1) | Amounts include gains and losses on currency swaps. |
(2) | The net |
(3) | Amounts do not include the net |
(4) | Amounts include realized and unrealized gains and losses on both derivative instruments and nonderivative instruments. Amounts on derivative instruments include gains and losses on forward foreign exchange contracts and currency options. Amounts on nonderivative instruments include translation gains and losses related to foreign currency-denominated |
28.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
derivative contracts whose fair value was not evidenced by market-observable data, and (2) the use of block
| ||
Level 1 | Quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities include debt and equity securities and derivative contracts that are traded in an active exchange market. | |
| ||
Level 2 | Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments. If no quoted market prices are available, the fair values of debt securities and over-the-counter derivative contracts in this category are determined using pricing models with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. | |
| ||
Level 3 | Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Level 3 assets and liabilities include financial instruments whose values are determined using pricing models, discounted cash flow methodologies, or similar techniques, as well as instruments for which the determination of fair value requires significant management judgment or estimation. |
“ securities”. securities.
As it pertains to investment funds, exchange-traded funds (“ETF”) are generally classified in Level 1.
2017 | Level 1 | Level 2 | Level 3 | Assets/ Liabilities measured at fair value | ||||||||||||
(in billions of yen) | ||||||||||||||||
Assets: | ||||||||||||||||
Trading securities(1): | ||||||||||||||||
Japanese government bonds | 1,485 | 23 | — | 1,508 | ||||||||||||
Japanese local government bonds | — | 69 | — | 69 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 2,883 | 80 | — | 2,963 | ||||||||||||
Other foreign government bonds | 1,127 | 457 | — | 1,584 | ||||||||||||
Agency mortgage-backed securities | — | 1,973 | — | 1,973 | ||||||||||||
Residential mortgage-backed securities | — | — | 15 | 15 | ||||||||||||
Commercial mortgage-backed securities | — | 3 | — | 3 | ||||||||||||
Certificates of deposit and commercial paper | — | 554 | — | 554 | ||||||||||||
Corporate bonds and other | 3 | 1,449 | 1,052 | 2,504 | ||||||||||||
Equity securities | 1,661 | 20 | 23 | 1,704 | ||||||||||||
Trading securities measured at net asset value(2) | 678 | |||||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 37 | 8,442 | 27 | 8,506 | ||||||||||||
Foreign exchange contracts | 28 | 2,709 | 8 | 2,745 | ||||||||||||
Equity-related contracts | 31 | 89 | 14 | 134 | ||||||||||||
Credit-related contracts | — | 33 | 2 | 35 | ||||||||||||
Other contracts | 1 | 11 | 11 | 23 | ||||||||||||
Available-for-sale securities: | ||||||||||||||||
Japanese government bonds | 9,543 | 720 | — | 10,263 | ||||||||||||
Japanese local government bonds | — | 284 | — | 284 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 1,144 | — | — | 1,144 | ||||||||||||
Other foreign government bonds | 346 | 589 | — | 935 | ||||||||||||
Agency mortgage-backed securities | — | 843 | — | 843 | ||||||||||||
Residential mortgage-backed securities | — | 67 | 77 | 144 | ||||||||||||
Commercial mortgage-backed securities | — | — | 224 | 224 | ||||||||||||
Japanese corporate bonds and other debt securities | — | 1,834 | 174 | 2,008 | ||||||||||||
Foreign corporate bonds and other debt securities | — | 801 | 110 | 911 | ||||||||||||
Equity securities (marketable) | 3,717 | 84 | — | 3,801 | ||||||||||||
Other investments | — | — | 37 | 37 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total assets measured at fair value on a recurring basis | 22,006 | 21,134 | 1,774 | 45,592 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Trading securities sold, not yet purchased | 1,993 | 228 | — | 2,221 | ||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 46 | 8,426 | 1 | 8,473 | ||||||||||||
Foreign exchange contracts | 20 | 2,591 | — | 2,611 | ||||||||||||
Equity-related contracts | 129 | 61 | 39 | 229 | ||||||||||||
Credit-related contracts | — | 34 | 2 | 36 | ||||||||||||
Other contracts | 1 | 10 | 11 | 22 | ||||||||||||
Long-term debt(3) | — | 903 | 593 | 1,496 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total liabilities measured at fair value on a recurring basis | 2,189 | 12,253 | 646 | 15,088 | ||||||||||||
|
|
|
|
|
|
|
|
2019 | Level 1 | Level 2 | Level 3 | Assets/ Liabilities measured at fair value | ||||||||||||
(in billions of yen) | ||||||||||||||||
Assets: | ||||||||||||||||
Trading securities (1) : | ||||||||||||||||
Japanese government bonds | 1,829 | 33 | — | 1,862 | ||||||||||||
Japanese local government bonds | — | 134 | — | 134 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 1,069 | 138 | — | 1,207 | ||||||||||||
Other foreign government bonds | 2,417 | 553 | — | 2,970 | ||||||||||||
Agency mortgage-backed securities | — | 1,041 | — | 1,041 | ||||||||||||
Residential mortgage-backed securities | — | — | 11 | 11 | ||||||||||||
Certificates of deposit and commercial paper | — | 1,047 | — | 1,047 | ||||||||||||
Corporate bonds and other (2) | 36 | 1,806 | 1,044 | 2,886 | ||||||||||||
Equity securities | 1,297 | — | 28 | 1,325 | ||||||||||||
Trading securities measured at net asset value (3) | 631 | |||||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 36 | 5,729 | 21 | 5,786 | ||||||||||||
Foreign exchange contracts | 9 | 1,927 | 23 | 1,959 | ||||||||||||
Equity-related contracts | 58 | 63 | 4 | 125 | ||||||||||||
Credit-related contracts | — | 16 | 2 | 18 | ||||||||||||
Other contracts | 2 | 4 | 10 | 16 | ||||||||||||
Available-for-sale securities: | ||||||||||||||||
Japanese government bonds | 10,902 | 995 | — | 11,897 | ||||||||||||
Japanese local government bonds | — | 210 | — | 210 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 1,009 | — | — | 1,009 | ||||||||||||
Other foreign government bonds | 456 | 886 | — | 1,342 | ||||||||||||
Agency mortgage-backed securities | — | 544 | — | 544 | ||||||||||||
Residential mortgage-backed securities | — | 61 | 40 | 101 | ||||||||||||
Commercial mortgage-backed securities | — | — | 500 | 500 | ||||||||||||
Japanese corporate bonds and other debt securities | — | 1,629 | 120 | 1,749 | ||||||||||||
Foreign corporate bonds and other debt securities | — | 678 | 103 | 781 | ||||||||||||
Equity securities: | ||||||||||||||||
Equity securities with readily determinable fair values | 3,633 | 135 | — | 3,768 | ||||||||||||
Equity securities measured at net asset value (3) | 53 | |||||||||||||||
Other investments | — | — | 35 | 35 | ||||||||||||
Total assets measured at fair value on a recurring basis | 22,753 | 17,629 | 1,941 | 43,007 | ||||||||||||
Liabilities: | ||||||||||||||||
Trading securities sold, not yet purchased | 2,380 | 199 | 1 | 2,580 | ||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 38 | 5,564 | 8 | 5,610 | ||||||||||||
Foreign exchange contracts | 11 | 1,746 | 1 | 1,758 | ||||||||||||
Equity-related contracts | 82 | 51 | 9 | 142 | ||||||||||||
Credit-related contracts | — | 16 | 1 | 17 | ||||||||||||
Other contracts | 1 | 4 | 9 | 14 | ||||||||||||
Long-term debt (4) | — | 1,778 | 655 | 2,433 | ||||||||||||
Total liabilities measured at fair value on a recurring basis | 2,512 | 9,358 | 684 | 12,554 | ||||||||||||
2018 | Level 1 | Level 2 | Level 3 | Assets/ Liabilities measured at fair value | ||||||||||||
(in billions of yen) | ||||||||||||||||
Assets: | ||||||||||||||||
Trading securities(1): | ||||||||||||||||
Japanese government bonds | 1,375 | 43 | — | 1,418 | ||||||||||||
Japanese local government bonds | — | 107 | — | 107 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 2,442 | 209 | — | 2,651 | ||||||||||||
Other foreign government bonds | 1,682 | 480 | — | 2,162 | ||||||||||||
Agency mortgage-backed securities | — | 1,799 | — | 1,799 | ||||||||||||
Residential mortgage-backed securities | — | — | 12 | 12 | ||||||||||||
Certificates of deposit and commercial paper | — | 643 | — | 643 | ||||||||||||
Corporate bonds and other | 25 | 1,992 | 1,013 | 3,030 | ||||||||||||
Equity securities | 1,642 | — | 23 | 1,665 | ||||||||||||
Trading securities measured at net asset value(2) | 705 | |||||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 39 | 7,089 | 48 | 7,176 | ||||||||||||
Foreign exchange contracts | 17 | 2,667 | 13 | 2,697 | ||||||||||||
Equity-related contracts | 82 | 110 | 5 | 197 | ||||||||||||
Credit-related contracts | — | 16 | 2 | 18 | ||||||||||||
Other contracts | 6 | 8 | 9 | 23 | ||||||||||||
Available-for-sale securities: | ||||||||||||||||
Japanese government bonds | 12,435 | 897 | — | 13,332 | ||||||||||||
Japanese local government bonds | — | 239 | — | 239 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 686 | — | — | 686 | ||||||||||||
Other foreign government bonds | 355 | 703 | — | 1,058 | ||||||||||||
Agency mortgage-backed securities | — | 889 | — | 889 | ||||||||||||
Residential mortgage-backed securities | — | 65 | 54 | 119 | ||||||||||||
Commercial mortgage-backed securities | — | — | 441 | 441 | ||||||||||||
Japanese corporate bonds and other debt securities | — | 1,827 | 163 | 1,990 | ||||||||||||
Foreign corporate bonds and other debt securities | — | 799 | 80 | 879 | ||||||||||||
Equity securities (marketable) | 3,912 | 121 | — | 4,033 | ||||||||||||
Other investments | — | — | 38 | 38 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total assets measured at fair value on a recurring basis | 24,698 | 20,703 | 1,901 | 48,007 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Liabilities: | ||||||||||||||||
Trading securities sold, not yet purchased | 2,777 | 618 | 4 | 3,399 | ||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 42 | 7,074 | 27 | 7,143 | ||||||||||||
Foreign exchange contracts | 11 | 2,370 | 1 | 2,382 | ||||||||||||
Equity-related contracts | 81 | 69 | 1 | 151 | ||||||||||||
Credit-related contracts | — | 20 | 1 | 21 | ||||||||||||
Other contracts | 4 | 6 | 9 | 19 | ||||||||||||
Long-term debt(3) | — | 1,395 | 561 | 1,956 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
Total liabilities measured at fair value on a recurring basis | 2,915 | 11,552 | 604 | 15,071 | ||||||||||||
|
|
|
|
|
|
|
|
2020 | Level 1 | Level 2 | Level 3 | Assets/ Liabilities measured at fair value | ||||||||||||
(in billions of yen) | ||||||||||||||||
Assets: | ||||||||||||||||
Trading securities (1) : | ||||||||||||||||
Japanese government bonds | 1,516 | 22 | — | 1,538 | ||||||||||||
Japanese local government bonds | — | 170 | — | 170 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 4,580 | 461 | — | 5,041 | ||||||||||||
Other foreign government bonds | 1,128 | 547 | — | 1,675 | ||||||||||||
Agency mortgage-backed securities | — | 3,390 | — | 3,390 | ||||||||||||
Residential mortgage-backed securities | — | — | 10 | 10 | ||||||||||||
Certificates of deposit and commercial paper | — | 1,036 | — | 1,036 | ||||||||||||
Corporate bonds and other (2) | 41 | 1,398 | 1,115 | 2,554 | ||||||||||||
Equity securities | 1,000 | 650 | 30 | 1,680 | ||||||||||||
Trading securities measured at net asset value (3) | 462 | |||||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 153 | 7,070 | 9 | 7,232 | ||||||||||||
Foreign exchange contracts | 9 | 2,900 | 17 | 2,926 | ||||||||||||
Equity-related contracts | 169 | 125 | 16 | 310 | ||||||||||||
Credit-related contracts | — | 22 | 8 | 30 | ||||||||||||
Other contracts | 3 | 11 | 24 | 38 | ||||||||||||
Available-for-sale securities: | ||||||||||||||||
Japanese government bonds | 11,950 | 653 | — | 12,603 | ||||||||||||
Japanese local government bonds | — | 273 | — | 273 | ||||||||||||
U.S. Treasury bonds and federal agency securities | 935 | — | — | 935 | ||||||||||||
Other foreign government bonds | 436 | 975 | — | 1,411 | ||||||||||||
Agency mortgage-backed securities | — | 505 | — | 505 | ||||||||||||
Residential mortgage-backed securities | — | 53 | 31 | 84 | ||||||||||||
Commercial mortgage-backed securities | — | — | 615 | 615 | ||||||||||||
Japanese corporate bonds and other debt securities | — | 1,678 | 157 | 1,835 | ||||||||||||
Foreign corporate bonds and other debt securities | — | 678 | 174 | 852 | ||||||||||||
Equity securities: | ||||||||||||||||
Equity securities with readily determinable fair values | 2,670 | 95 | — | 2,765 | ||||||||||||
Equity securities measured at net asset value (3) | 72 | |||||||||||||||
Other investments | — | — | 39 | 39 | ||||||||||||
Total assets measured at fair value on a recurring basis | 24,590 | 22,712 | 2,245 | 50,081 | ||||||||||||
Liabilities: | ||||||||||||||||
Trading securities sold, not yet purchased | 1,880 | 515 | — | 2,395 | ||||||||||||
Derivative financial instruments: | ||||||||||||||||
Interest rate contracts | 163 | 6,611 | 14 | 6,788 | ||||||||||||
Foreign exchange contracts | 8 | 2,890 | 1 | 2,899 | ||||||||||||
Equity-related contracts | 186 | 47 | 33 | 266 | ||||||||||||
Credit-related contracts | — | 19 | 10 | 29 | ||||||||||||
Other contracts | 6 | 10 | 23 | 39 | ||||||||||||
Long-term debt (4) | — | 1,916 | 621 | 2,537 | ||||||||||||
Total liabilities measured at fair value on a recurring basis | 2,243 | 12,008 | 702 | 14,953 | ||||||||||||
(1) | Trading securities include foreign currency denominated securities for which the MHFG Group elected the fair value option. |
(2) | The amount includes CLO and convertible bonds, which are classified in Level 3 . |
(3) | In accordance with ASC 820, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented for these classes of assets are intended to permit the reconciliation of the fair value hierarchy to the amounts presented in the statements of financial position. The amounts of unfunded commitments related to these investments at March 31, |
Amounts represent items for which the Group elected the fair value |
2017 | April 1, 2016 | Gains (losses) in Earnings | Gains (losses) in OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issuances | Settle- ments | March 31, 2017 | Change in unrealized gains (losses) still held (6) | |||||||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 21 | (1 | )(2) | — | — | — | — | — | — | (5 | ) | 15 | (1 | ) | ||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 2 | — | (2) | — | — | — | — | — | — | (2 | ) | — | — | |||||||||||||||||||||||||||||||
Corporate bonds and other | 720 | 12 | (2) | — | 296 | (39 | ) | 875 | (555 | ) | — | (257 | ) | 1,052 | 19 | |||||||||||||||||||||||||||||
Equity securities | 21 | 1 | (2) | — | — | — | 3 | (2 | ) | — | — | 23 | — | |||||||||||||||||||||||||||||||
Derivative financial instruments, net (1): | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate contracts | 26 | (2 | )(2) | — | — | — | — | — | — | 2 | 26 | 2 | ||||||||||||||||||||||||||||||||
Foreign exchange contracts | 7 | 7 | (2) | — | — | — | — | — | — | (6 | ) | 8 | 1 | |||||||||||||||||||||||||||||||
Equity-related contracts | 5 | (31 | )(2) | — | — | — | — | — | — | 1 | (25 | ) | (35 | ) | ||||||||||||||||||||||||||||||
Credit-related contracts | (1 | ) | 1 | (2) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||||||
Other contracts | 1 | — | (2) | — | — | — | — | — | — | (1 | ) | — | — | |||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 123 | — | (3) | (1 | )(4) | — | — | — | (7 | ) | — | (38 | ) | 77 | — | |||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 187 | — | (3) | 1 | (4) | — | — | 63 | (12 | ) | — | (15 | ) | 224 | — | |||||||||||||||||||||||||||||
Japanese corporate bonds and other debt securities | 174 | (1 | )(3) | 43 | (4) | — | — | 10 | (19 | ) | — | (33 | ) | 174 | — | |||||||||||||||||||||||||||||
Foreign corporate bonds and other debt securities | 108 | 1 | (3) | (1 | )(4) | — | (2 | ) | 10 | — | — | (6 | ) | 110 | — | |||||||||||||||||||||||||||||
Other investments | 42 | — | (3) | — | — | — | 12 | (3 | ) | — | (14 | ) | 37 | — | ||||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities sold, not yet purchased | — | — | (2) | — | 1 | — | (54 | ) | 53 | — | — | — | — | |||||||||||||||||||||||||||||||
Long-term debt | 623 | 20 | (5) | — | 21 | (12 | ) | (2 | ) | 1 | 278 | (296 | ) | 593 | 18 |
2019 | April 1, 2018 | Gains (losses) in Earnings | Gains (losses) in OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issuances | Settle- ments | March 31, 2019 | Change in unrealized gains (losses) still held (6) | |||||||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 12 | — | (2) | — | — | — | — | — | — | (1 | ) | 11 | — | |||||||||||||||||||||||||||||||
Corporate bonds and other | 1,013 | 1 | (2) | — | — | — | 762 | (378 | ) | — | (354 | ) | 1,044 | 8 | ||||||||||||||||||||||||||||||
Equity securities | 23 | 1 | (2) | — | — | — | 7 | (3 | ) | — | — | 28 | (1 | ) | ||||||||||||||||||||||||||||||
Derivative financial instruments, net (1) : | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate contracts | 21 | (11 | ) (2) | — | — | — | — | — | — | 3 | 13 | (5 | ) | |||||||||||||||||||||||||||||||
Foreign exchange contracts | 12 | 15 | (2) | — | — | — | — | — | — | (5 | ) | 22 | 14 | |||||||||||||||||||||||||||||||
Equity-related contracts | 4 | (15 | ) (2) | — | — | — | — | — | — | 6 | (5 | ) | 3 | |||||||||||||||||||||||||||||||
Credit-related contracts | 1 | (2 | ) (2) | — | — | — | — | — | — | 2 | 1 | 1 | ||||||||||||||||||||||||||||||||
Other contracts | — | 1 | (2) | — | — | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 54 | — | (3) | — | (4) | — | — | — | — | — | (14 | ) | 40 | — | ||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 441 | — | (3) | 1 | (4) | — | — | 144 | (72 | ) | — | (14 | ) | 500 | — | |||||||||||||||||||||||||||||
Japanese corporate bonds and other debt securities | 163 | 37 | (3) | (33 | ) (4) | — | — | 29 | (7 | ) | — | (69 | ) | 120 | 19 | |||||||||||||||||||||||||||||
Foreign corporate bonds and other debt securities | 80 | — | (3) | (1 | ) (4) | 61 | (42 | ) | 27 | — | — | (22 | ) | 103 | — | |||||||||||||||||||||||||||||
Other investments | 38 | 5 | (3) | — | — | — | 13 | (6 | ) | — | (15 | ) | 35 | (2 | ) | |||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities sold, not yet purchased | 4 | 1 | (2) | — | — | — | (35 | ) | 33 | — | — | 1 | — | |||||||||||||||||||||||||||||||
Long-term debt | 561 | (6 | ) (5) | 10 | (4) | 7 | — | — | — | 192 | (101 | ) | 655 | 5 |
2018 | April 1, 2017 | Gains (losses) in Earnings | Gains (losses) in OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issuances | Settle- ments | March 31, 2018 | Change in unrealized gains (losses) still held (6) | |||||||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 15 | — | (2) | — | — | — | — | — | — | (3 | ) | 12 | — | |||||||||||||||||||||||||||||||
Corporate bonds and other | 1,052 | (20 | )(2) | — | 123 | (241 | ) | 1,082 | (631 | ) | — | (352 | ) | 1,013 | (19 | ) | ||||||||||||||||||||||||||||
Equity securities | 23 | (1 | )(2) | — | — | — | 2 | (1 | ) | — | — | 23 | — | |||||||||||||||||||||||||||||||
Derivative financial instruments, net(1): | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate contracts | 26 | (6 | )(2) | — | — | — | — | — | — | 1 | 21 | (1 | ) | |||||||||||||||||||||||||||||||
Foreign exchange contracts | 8 | 2 | (2) | — | — | — | — | — | — | 2 | 12 | 5 | ||||||||||||||||||||||||||||||||
Equity-related contracts | (25 | ) | 1 | (2) | — | — | — | — | — | — | 28 | 4 | 12 | |||||||||||||||||||||||||||||||
Credit-related contracts | — | — | (2) | — | — | — | — | — | — | 1 | 1 | — | ||||||||||||||||||||||||||||||||
Other contracts | — | (1 | )(2) | — | — | — | — | — | — | 1 | — | — | ||||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 77 | — | (3) | — | (4) | — | — | 3 | (6 | ) | — | (20 | ) | 54 | — | |||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 224 | — | (3) | 3 | (4) | — | — | 286 | (69 | ) | — | (3 | ) | 441 | — | |||||||||||||||||||||||||||||
Japanese corporate bonds and other debt securities | 174 | 11 | (3) | (10 | )(4) | — | — | 17 | — | — | (29 | ) | 163 | 11 | ||||||||||||||||||||||||||||||
Foreign corporate bonds and other debt securities | 110 | — | (3) | (1 | )(4) | 15 | (46 | ) | 2 | — | — | — | 80 | — | ||||||||||||||||||||||||||||||
Other investments | 37 | — | (3) | — | — | — | 14 | (3 | ) | — | (10 | ) | 38 | — | ||||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities sold, not yet purchased | — | — | (2) | — | — | — | (146 | ) | 150 | — | — | 4 | — | |||||||||||||||||||||||||||||||
Long-term debt | 593 | 3 | (5) | — | 1 | (10 | ) | — | — | 151 | (171 | ) | 561 | 5 |
2020 | April 1, 2019 | Gains (losses) in Earnings | Gains (losses) in OCI | Transfers into Level 3 | Transfers out of Level 3 | Purchases | Sales | Issuances | Settle- ments | March 31, 2020 | Change in unrealized gains (losses) still held (6) | |||||||||||||||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 11 | — | (2) | — | — | — | — | — | — | (1 | ) | 10 | — | |||||||||||||||||||||||||||||||
Corporate bonds and other | 1,044 | (52 | ) (2) | — | — | — | 802 | (297 | ) | — | (382 | ) | 1,115 | (52 | ) | |||||||||||||||||||||||||||||
Equity securities | 28 | (1 | ) (2) | — | — | — | 6 | (2 | ) | — | (1 | ) | 30 | (1 | ) | |||||||||||||||||||||||||||||
Derivative financial instruments, net (1) : | ||||||||||||||||||||||||||||||||||||||||||||
Interest rate contracts | 13 | (6 | ) (2) | — | 1 | — | — | — | — | (13 | ) | (5 | ) | (16 | ) | |||||||||||||||||||||||||||||
Foreign exchange contracts | 22 | (4 | ) (2) | — | — | — | — | — | — | (2 | ) | 16 | (3 | ) | ||||||||||||||||||||||||||||||
Equity-related contracts | (5 | ) | (8 | ) (2) | — | — | — | — | — | — | (4 | ) | (17 | ) | (10 | ) | ||||||||||||||||||||||||||||
Credit-related contracts | 1 | (2 | ) (2) | — | (1 | ) | (1 | ) | — | — | — | 1 | (2 | ) | (1 | ) | ||||||||||||||||||||||||||||
Other contracts | 1 | 2 | (2) | — | — | — | — | — | — | (2 | ) | 1 | 1 | |||||||||||||||||||||||||||||||
Available-for-sale securities: | ||||||||||||||||||||||||||||||||||||||||||||
Residential mortgage-backed securities | 40 | — | (3) | — | (4) | — | — | 3 | — | — | (12 | ) | 31 | — | ||||||||||||||||||||||||||||||
Commercial mortgage-backed securities | 500 | — | (3) | 1 | (4) | — | — | 201 | (77 | ) | — | (10 | ) | 615 | — | |||||||||||||||||||||||||||||
Japanese corporate bonds and other debt securities | 120 | 2 | (3) | — | (4) | — | — | 106 | — | — | (71 | ) | 157 | — | ||||||||||||||||||||||||||||||
Foreign corporate bonds and other debt securities | 103 | — | (3) | (11 | ) (4) | — | — | 94 | — | — | (12 | ) | 174 | — | ||||||||||||||||||||||||||||||
Other investments | 35 | 3 | (3) | — | — | — | 15 | — | — | (14 | ) | 39 | 3 | |||||||||||||||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||||||||||||||||||||||
Trading securities sold, not yet purchased | 1 | — | (2) | — | — | — | (18 | ) | 17 | — | — | — | — | |||||||||||||||||||||||||||||||
Long-term debt | 655 | 53 | (5) | 17 | (4) | 77 | (8 | ) | — | — | 312 | (345 | ) | 621 | 79 |
(1) | Total Level 3 derivative exposures have been netted on the table for presentation purposes only. |
(2) | Gains (losses) in Earnings are reported in Trading account gains (losses)—net, Foreign exchange gains (losses)—net or Other noninterest income (expenses). |
(3) | Gains (losses) in Earnings are reported in Investment gains (losses)—net. |
(4) | Gains (losses) in OCI are reported in Other comprehensive income (loss). |
(5) | Gains (losses) in Earnings are reported in Other noninterest income (expenses). |
(6) | Amounts represent total gains or losses recognized in earnings during the period. These gains or losses were attributable to the change in fair value relating to assets and liabilities classified as Level 3 that were still held at March 31, |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
During the fiscal year ended March 31, 2018, the transfers into Level 3 included ¥123 billion of Trading securities, ¥15 billion ofAvailable-for-sale securities and ¥1 billion of Long-term debt. Transfers into Level 3 for Trading securities andAvailable-for-salesecurities were primarily due to decreased liquidity for certain Foreign corporate bonds. Transfers into Level 3 for Long-term debt were primarily due to changes in the impact of unobservable inputs on the value of certain structured notes. During the fiscal year ended March 31, 2018,2019, the transfers out of Level 3 included ¥241¥42 billion of Trading securities, ¥46 billion of securities and ¥10 billion of Long-term debt. Trading securities were primarily due to increased price transparency for certain Japanese and foreign corporate bonds. Transfers out of Level 3 for
2017 | ||||||||||||||||
Products/Instruments | Fair value | Principal valuation technique | Unobservable inputs | Range of input values | Weighted average (5) | |||||||||||
(in billions of yen, except for percentages and basis points) | ||||||||||||||||
Trading securities andAvailable-for-sale securities: | ||||||||||||||||
Residential mortgage-backed securities | 92 | Discounted cash flow | Prepayment rate | 0%–18% | 7% | |||||||||||
Price-based | Default rate | 0%–1% | 0% | |||||||||||||
Recovery rate | 100%–100% | 100% | ||||||||||||||
Discount margin | 15bps–170bps | 55bps | ||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Commercial mortgage-backed securities | 224 | Discounted cash flow Price-based | Discount margin | 4bps–205bps | 28bps | |||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Corporate bonds and other debt securities | 1,336 | Discounted cash flow | Prepayment rate (1) | 16%–30% | 29% | |||||||||||
Price-based | Default rate (1) | 1%–2% | 2% | |||||||||||||
Recovery rate (1) | 60%–68% | 68% | ||||||||||||||
Discount margin (1) | 8bps–1,181bps | 131bps | ||||||||||||||
Discount margin (2) | 10bps–939bps | 359bps | ||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Derivative financial instruments, net: | ||||||||||||||||
Interest rate contracts | 26 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
Default rate (4) | 0%–63% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Foreign exchange contracts | 8 | Internal valuation model (3) | FX – IR correlation | 5%–52% | ||||||||||||
FX – FX correlation | 55%–55% | |||||||||||||||
Default rate (4) | 0%–63% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Equity-related contracts | (25 | ) | Internal valuation model (3) | Equity – IR correlation | 25%–25% | |||||||||||
Equity – FX correlation | 55%–55% | |||||||||||||||
Equity volatility | 6%–59% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Credit-related contracts | — | Internal valuation model (3) | Default rate | 0%–5% | ||||||||||||
Credit correlation | 30%–100% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Long-term debt | 593 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
FX – IR correlation | 5%–52% | |||||||||||||||
FX – FX correlation | 55%–55% | |||||||||||||||
Equity – IR correlation | 25%–25% | |||||||||||||||
Equity – FX correlation | 55%–55% | |||||||||||||||
Equity correlation | 20%–100% | |||||||||||||||
Equity volatility | 5%–40% | |||||||||||||||
Default rate | 0%–3% | |||||||||||||||
Credit correlation | 33%–100% |
2019 | ||||||||||||||||
Products/Instruments | Fair value | Principal valuation technique | Unobservable inputs | Range of input values | Weighted average (5) | |||||||||||
(in billions of yen, except for percentages and basis points) | ||||||||||||||||
Trading securities and Available-for-sale securities: | ||||||||||||||||
Residential mortgage-backed securities | 51 | Discounted cash flow Price-based | Prepayment rate Default rate Recovery rate Discount margin | 4%–19% 0%–1% 100%–100% 18bps–170bps | 8% 0% 100% 51bps | |||||||||||
Commercial mortgage-backed securities | 500 | Discounted cash flow Price-based | Discount margin | 9bps–161bps | 24bps | |||||||||||
Corporate bonds and other debt securities | 1,267 | Discounted cash flow Price-based | Prepayment rate (1) Default rate (1) Recovery rate (1) Discount margin (1) Discount margin (2) | 22%–22% 2%–2% 69%–69% 48bps–1,173bps 4bps–1,063bps | 22% 2% 69% 134bps 295bps | |||||||||||
Derivative financial instruments, net: | ||||||||||||||||
Interest rate contracts | 13 | Internal valuation model (3) | IR – IR correlation Default rate (4) | 23%–100% 0%–63% | ||||||||||||
Foreign exchange contracts | 22 | Internal valuation model (3) | FX – IR correlation FX – FX correlation Default rate (4) | 9%–55% 63%–63% 0%–63% | ||||||||||||
Equity-related contracts | (5 | ) | Internal valuation model (3) | Equity – IR correlation Equity correlation Equity volatility | 25%–25% 40%–100% 5%–36% | |||||||||||
Credit-related contracts | 1 | Internal valuation model (3) | Default rate Credit correlation | 0%–5% 29%–100% | ||||||||||||
Long-term debt | 655 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
FX – IR correlation | 9%–55% | |||||||||||||||
FX – FX correlation | 63%–63% | |||||||||||||||
Equity – IR correlation | 25%–25% | |||||||||||||||
Equity – FX correlation | 55%–88% | |||||||||||||||
Equity correlation | 12%–100% | |||||||||||||||
Equity volatility | 5%–49% | |||||||||||||||
Default rate | 0%–4% | |||||||||||||||
Credit correlation | 20%–100% |
2018 | ||||||||||||||||
Products/Instruments | Fair value | Principal valuation technique | Unobservable inputs | Range of input values | Weighted average (5) | |||||||||||
(in billions of yen, except for percentages and basis points) | ||||||||||||||||
Trading securities andAvailable-for-sale securities: | ||||||||||||||||
Residential mortgage-backed securities | 66 | Discounted cash flow | Prepayment rate | 3%–17% | 7% | |||||||||||
Price-based | Default rate | 0%–1% | 0% | |||||||||||||
Recovery rate | 100%–100% | 100% | ||||||||||||||
Discount margin | 17bps–170bps | 50bps | ||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Commercial mortgage-backed securities | 441 | Discounted cash flow | Discount margin | 9bps – 141bps | 28bps | |||||||||||
Price-based | ||||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Corporate bonds and other debt securities | 1,256 | Discounted cash flow | Prepayment rate (1) | 26%–37% | 36% | |||||||||||
Price-based | Default rate (1) | 1%–2% | 2% | |||||||||||||
Recovery rate (1) | 60%–69% | 68% | ||||||||||||||
Discount margin (1) | 12bps–1,165bps | 115bps | ||||||||||||||
Discount margin (2) | 5bps–1,064bps | 379bps | ||||||||||||||
|
|
|
|
|
|
|
|
| ||||||||
Derivative financial instruments, net: | ||||||||||||||||
Interest rate contracts | 21 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
Default rate (4) | 0%–63% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Foreign exchange contracts | 12 | Internal valuation model (3) | FX – IR correlation | 16%–53% | ||||||||||||
FX – FX correlation | 61%–61% | |||||||||||||||
Default rate (4) | 0%–63% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Equity-related contracts | 4 | Internal valuation model (3) | Equity – IR correlation | 25%–25% | ||||||||||||
Equity volatility | 12%–41% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Credit-related contracts | 1 | Internal valuation model (3) | Default rate | 0%–3% | ||||||||||||
Credit correlation | 27%–100% | |||||||||||||||
|
|
|
|
|
|
| ||||||||||
Long-term debt | 561 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
FX – IR correlation | 9%–53% | |||||||||||||||
FX – FX correlation | 61%–61% | |||||||||||||||
Equity – IR correlation | 25%–25% | |||||||||||||||
Equity – FX correlation | 55%–70% | |||||||||||||||
Equity correlation | 24%–100% | |||||||||||||||
Equity volatility | 13%–56% | |||||||||||||||
Default rate | 0%–2% | |||||||||||||||
Credit correlation | 28%–100% |
2020 | ||||||||||||||||
Products/Instruments | Fair value | Principal valuation technique | Unobservable inputs | Range of input values | Weighted average (5) | |||||||||||
(in billions of yen, except for percentages and basis points) | ||||||||||||||||
Trading securities and Available-for-sale securities: | ||||||||||||||||
Residential mortgage- backed securities | 41 | Discounted cash flow Price-based | Prepayment rate Default rate Recovery rate Discount margin | 4%–16% 0%–1% 100%–100% 5bps–170bps | 7% 0% 100% 52bps | |||||||||||
Commercial mortgage-backed securities | 615 | Discounted cash flow Price-based | Discount margin | 7bps–185bps | 22bps | |||||||||||
Corporate bonds and other debt securities | 1,446 | Discounted cash flow Price-based | Prepayment rate (1) Default rate (1) Recovery rate (1) Discount margin (1) Discount margin (2) | 13%–21% 0%–2% 10%–70% 61bps–1,160bps 5bps–1,528bps | 21% 2% 67% 256bps 58bps | |||||||||||
Derivative financial instruments, net: | ||||||||||||||||
Interest rate contracts | (5 | ) | Internal valuation model (3) | IR – IR correlation Default rate (4) | 23%–100% 0%–63% | |||||||||||
Foreign exchange contracts | 16 | Internal valuation model (3) | FX – IR correlation FX – FX correlation Default rate (4) | -37%–49% 56%–65% 0%–63% | ||||||||||||
Equity-related contracts | (17 | ) | Internal valuation model (3) | Equity – IR correlation Equity correlation Equity volatility | 25%–25% 0%–100% 13%–157% | |||||||||||
Credit-related contracts | (2 | ) | Internal valuation model (3) | Default rate Credit correlation | 0%–15% 30%–100% | |||||||||||
Long-term debt | 621 | Internal valuation model (3) | IR – IR correlation | 23%–100% | ||||||||||||
FX – IR correlation | -37%–50% | |||||||||||||||
FX – FX correlation | 56%–65% | |||||||||||||||
Equity – IR correlation | 25%–25% | |||||||||||||||
Equity – FX correlation | -33%–100% | |||||||||||||||
Equity correlation | 0%–100% | |||||||||||||||
Equity volatility | 15%–157% | |||||||||||||||
Default rate | 0%–12% | |||||||||||||||
Credit correlation | 15%–100% |
(1) | These inputs are mainly used for determining the fair values of securitization products such as CDO, CLO and ABS, other than RMBS and CMBS. |
(2) | This input is mainly used for determining the fair values of Japanese corporate bonds and foreign corporate bonds. |
(3) | Internal valuation model includes discounted cash flow models and the Black-Scholes option pricing model. |
(4) | This input represents the counterparty default rate derived from the MHFG Group’s own internal credit analyses. |
(5) | Weighted averages are calculated by weighting each input by the relative fair value of the respective financial instruments. |
2017 | Total | Level 1 | Level 2 | Level 3 | Aggregate cost | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Loans | 124 | — | — | 124 | 194 | |||||||||||||||
Loansheld-for-sale | 7 | — | 7 | — | 8 | |||||||||||||||
Other investments | 7 | 6 | — | 1 | 11 | |||||||||||||||
Premises and equipment—net | 7 | — | 6 | 1 | 11 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total assets measured at fair value on a nonrecurring basis | 145 | 6 | 13 | 126 | 224 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
2018 | Total | Level 1 | Level 2 | Level 3 | Aggregate cost | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Loans | 113 | — | — | 113 | 164 | |||||||||||||||
Loansheld-for-sale | 60 | — | 60 | — | 74 | |||||||||||||||
Other investments | 1 | — | — | 1 | 3 | |||||||||||||||
Premises and equipment—net | — | — | — | — | 4 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total assets measured at fair value on a nonrecurring basis | 174 | — | 60 | 114 | 245 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
2019 | Total | Level 1 | Level 2 | Level 3 | Aggregate cost | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Loans | 125 | — | 41 | 84 | 177 | |||||||||||||||
Loans held-for-sale | 3 | — | 3 | — | 3 | |||||||||||||||
Equity securities (without readily determinable fair values) | 1 | — | — | 1 | 1 | |||||||||||||||
Other investments | 98 | 98 | — | — | 104 | |||||||||||||||
Premises and equipment—net | 9 | — | 4 | 5 | 34 | |||||||||||||||
Intangible assets | — | — | — | — | 1 | |||||||||||||||
Total assets measured at fair value on a nonrecurring basis | 236 | 98 | 48 | 90 | 320 | |||||||||||||||
2020 | Total | Level 1 | Level 2 | Level 3 | Aggregate cost | |||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Assets: | ||||||||||||||||||||
Loans | 90 | — | — | 90 | 136 | |||||||||||||||
Loans held-for-sale | 26 | — | 20 | 6 | 26 | |||||||||||||||
Equity securities (without readily determinable fair values) | 2 | — | — | 2 | 2 | |||||||||||||||
Premises and equipment—net | 1 | — | 1 | — | 12 | |||||||||||||||
Other assets | — | — | — | — | 3 | |||||||||||||||
Good ill | — | — | — | — | 2 | |||||||||||||||
Total assets measured at fair value on a nonrecurring basis | 119 | — | 21 | 98 | 181 | |||||||||||||||
Note: | The fair values may not be current as of the dates indicated, but rather as of the date the fair value change occurred. Accordingly, the carrying values may not equal current fair value. |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
On April 1, 2018, the Group adopted ASU
The Group records changes in fair value on these notes attributable to the instrument-specific credit risk in AOCI in accordance with ASU
ASC 825 does not require the disclosure of the fair value of nonfinancial instruments.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
liabilities.”
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
liabilities.”
20
2017 | ||||||||||||||||||||
Carrying amount | Estimated fair value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and due from banks, interest-bearing deposits in other banks, call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 60,943 | 60,943 | 1,063 | 59,880 | — | |||||||||||||||
Investments | 3,817 | 3,846 | 3,097 | 749 | — | |||||||||||||||
Loans, net of allowance for loan losses(Note) | 81,662 | 82,696 | — | — | 82,696 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Noninterest-bearing deposits, call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 42,205 | 42,205 | 20,544 | 21,661 | — | |||||||||||||||
Interest-bearing deposits | 110,125 | 110,124 | 56,738 | 53,386 | — | |||||||||||||||
Due to trust accounts | 4,123 | 4,123 | — | 4,123 | — | |||||||||||||||
Other short-term borrowings | 1,477 | 1,477 | — | 1,477 | — | |||||||||||||||
Long-term debt | 13,009 | 13,078 | — | 12,120 | 958 |
2019 | ||||||||||||||||||||
Carrying amount | Estimated fair value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and due from banks, interest-bearing deposits in other banks, call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 62,012 | 62,012 | 873 | 61,139 | — | |||||||||||||||
Investments | 1,604 | 1,609 | 1,140 | 469 | — | |||||||||||||||
Loans, net of allowance for loan losses (Note) | 82,382 | 83,490 | — | — | 83,490 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Noninterest-bearing deposits, call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 44,918 | 44,918 | 24,983 | 19,935 | — | |||||||||||||||
Interest-bearing deposits | 112,658 | 112,655 | 55,542 | 57,113 | — | |||||||||||||||
Due to trust accounts | 312 | 312 | — | 312 | — | |||||||||||||||
Other short-term borrowings | 1,995 | 1,995 | — | 1,995 | — | |||||||||||||||
Long-term debt | 9,096 | 9,178 | — | 8,336 | 842 | |||||||||||||||
2020 | ||||||||||||||||||||
Carrying amount | Estimated fair value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and due from banks, interest-bearing deposits in other banks, call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 63,755 | 63,755 | 1,318 | 62,437 | — | |||||||||||||||
Investments | 862 | 875 | 493 | 382 | — | |||||||||||||||
Loans, net of allowance for loan losses (Note) | 86,914 | 88,124 | — | — | 88,124 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Noninterest-bearing deposits, call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 51,954 | 51,954 | 29,812 | 22,142 | — | |||||||||||||||
Interest-bearing deposits | 114,653 | 114,659 | 58,935 | 55,724 | — | |||||||||||||||
Due to trust accounts | 250 | 250 | — | 250 | — | |||||||||||||||
Other short-term borrowings | 4,914 | 4,914 | — | 4,914 | — | |||||||||||||||
Long-term debt | 7,821 | 7,708 | — | 6,813 | 895 |
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
2018 | ||||||||||||||||||||
Carrying amount | Estimated fair value | |||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | |||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
Financial assets: | ||||||||||||||||||||
Cash and due from banks, interest-bearing deposits in other banks, call loans and funds sold, and receivables under resale agreements and securities borrowing transactions | 61,381 | 61,381 | 1,206 | 60,175 | — | |||||||||||||||
Investments | 2,518 | 2,522 | 1,984 | 538 | — | |||||||||||||||
Loans, net of allowance for loan losses(Note) | 83,088 | 84,041 | — | — | 84,041 | |||||||||||||||
Financial liabilities: | ||||||||||||||||||||
Noninterest-bearing deposits, call money and funds purchased, and payables under repurchase agreements and securities lending transactions | 43,921 | 43,921 | 22,898 | 21,023 | — | |||||||||||||||
Interest-bearing deposits | 113,558 | 113,540 | 61,719 | 51,821 | — | |||||||||||||||
Due to trust accounts | 3,993 | 3,993 | — | 3,993 | — | |||||||||||||||
Other short-term borrowings | 1,688 | 1,688 | — | 1,688 | — | |||||||||||||||
Long-term debt | 10,970 | 10,995 | — | 10,098 | 897 |
Note: | Loans, net of allowance for loan losses include items measured at fair value on a nonrecurring basis. |
29.
Amounts not offset on the balance sheet (3) | ||||||||||||||||||||||||
Gross amounts recognized | Gross amounts offset on the balance sheet | Net amounts presented on the balance sheet (2) | Financial instruments (4) | Cash collateral | Net amounts | |||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
2017 | ||||||||||||||||||||||||
Assets (1): | ||||||||||||||||||||||||
Derivatives | 10,608 | — | 10,608 | (8,966 | ) | (620 | ) | 1,022 | ||||||||||||||||
Receivables under resale agreements | 8,698 | — | 8,698 | (8,662 | ) | — | 36 | |||||||||||||||||
Receivables under securities borrowing transactions | 3,127 | — | 3,127 | (3,116 | ) | — | 11 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 22,433 | — | 22,433 | (20,744 | ) | (620 | ) | 1,069 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Liabilities (1): | ||||||||||||||||||||||||
Derivatives | 10,405 | — | 10,405 | (8,866 | ) | (901 | ) | 638 | ||||||||||||||||
Payables under repurchase agreements | 17,446 | — | 17,446 | (17,391 | ) | — | 55 | |||||||||||||||||
Payables under securities lending transactions | 1,458 | — | 1,458 | (1,455 | ) | — | 3 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 29,309 | — | 29,309 | (27,712 | ) | (901 | ) | 696 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
2018 | ||||||||||||||||||||||||
Assets (1): | ||||||||||||||||||||||||
Derivatives | 9,341 | — | 9,341 | (7,751 | ) | (520 | ) | 1,070 | ||||||||||||||||
Receivables under resale agreements | 7,804 | — | 7,804 | (7,763 | ) | — | 41 | |||||||||||||||||
Receivables under securities borrowing transactions | 3,904 | — | 3,904 | (3,874 | ) | — | 30 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 21,049 | — | 21,049 | (19,388 | ) | (520 | ) | 1,141 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Liabilities (1): | ||||||||||||||||||||||||
Derivatives | 9,013 | — | 9,013 | (7,758 | ) | (884 | ) | 371 | ||||||||||||||||
Payables under repurchase agreements | 15,964 | — | 15,964 | (15,847 | ) | — | 117 | |||||||||||||||||
Payables under securities lending transactions | 1,181 | — | 1,181 | (1,179 | ) | — | 2 | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total | 26,158 | — | 26,158 | (24,784 | ) | (884 | ) | 490 | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Amounts not offset on the balance sheet (3) | ||||||||||||||||||||||||
Gross amounts recognized | Gross amounts offset on the balance sheet | Net amounts presented on the balance sheet (2) | Financial instruments (4) | Cash collateral | Net amounts | |||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
2019 | ||||||||||||||||||||||||
Assets (1) : | ||||||||||||||||||||||||
Derivatives | 7,403 | — | 7,403 | (5,903 | ) | (528 | ) | 972 | ||||||||||||||||
Receivables under resale agreements | 12,589 | — | 12,589 | (12,579 | ) | — | 10 | |||||||||||||||||
Receivables under securities borrowing transactions | 1,921 | — | 1,921 | (1,894 | ) | — | 27 | |||||||||||||||||
Total | 21,913 | — | 21,913 | (20,376 | ) | (528 | ) | 1,009 | ||||||||||||||||
Liabilities (1) : | ||||||||||||||||||||||||
Derivatives | 6,978 | — | 6,978 | (5,766 | ) | (769 | ) | 443 | ||||||||||||||||
Payables under repurchase agreements | 14,312 | — | 14,312 | (14,309 | ) | — | 3 | |||||||||||||||||
Payables under securities lending transactions | 932 | — | 932 | (931 | ) | — | 1 | |||||||||||||||||
Total | 22,222 | — | 22,222 | (21,006 | ) | (769 | ) | 447 | ||||||||||||||||
2020 | ||||||||||||||||||||||||
Assets (1) : | ||||||||||||||||||||||||
Derivatives | 9,819 | — | 9,819 | (7,723 | ) | (629 | ) | 1,467 | ||||||||||||||||
Receivables under resale agreements | 17,347 | — | 17,347 | (17,197 | ) | — | 150 | |||||||||||||||||
Receivables under securities borrowing transactions | 1,753 | — | 1,753 | (1,709 | ) | — | 44 | |||||||||||||||||
Total | 28,919 | — | 28,919 | (26,629 | ) | (629 | ) | 1,661 | ||||||||||||||||
Liabilities (1) : | ||||||||||||||||||||||||
Derivatives | 9,220 | — | 9,220 | (7,519 | ) | (1,215 | ) | 486 | ||||||||||||||||
Payables under repurchase agreements | 17,542 | — | 17,542 | (17,191 | ) | — | 351 | |||||||||||||||||
Payables under securities lending transactions | 626 | — | 626 | (623 | ) | — | 3 | |||||||||||||||||
Total | 27,388 | — | 27,388 | (25,333 | ) | (1,215 | ) | 840 | ||||||||||||||||
(1) | Amounts relating to master netting arrangements or similar agreements where the MHFG Group does not have the legal right of set-off or where uncertainty exists as to the enforceability of these agreements are excluded. For derivatives, the table includes amounts relating toover-the-counter (“OTC”) andOTC-cleared derivatives that are subject to enforceable master netting arrangements or similar agreements. |
(2) | Derivative assets and liabilities are recorded in Trading account assets and Trading account liabilities, respectively. |
(3) | Amounts do not exceed the net amounts presented on the balance sheet and do not include the effect of overcollateralization, where it exists. |
(4) | For derivatives, amounts include derivative assets or liabilities and securities collateral that are eligible for offsetting under enforceable master netting arrangements or similar agreements. |
30.
Overnight and continuous | Up to 30 days | 31-90 days | Greater than 90 days | Total | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
2017 | ||||||||||||||||||||
Repurchase agreements | 249 | 12,700 | 3,897 | 1,124 | 17,970 | |||||||||||||||
Securities lending transactions | 320 | 1,359 | — | 240 | 1,919 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 569 | 14,059 | 3,897 | 1,364 | 19,889 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
2018 | ||||||||||||||||||||
Repurchase agreements | 255 | 11,669 | 3,676 | 1,057 | 16,657 | |||||||||||||||
Securities lending transactions | 1,270 | 355 | — | 208 | 1,833 | |||||||||||||||
|
|
|
|
|
|
|
|
|
| |||||||||||
Total | 1,525 | 12,024 | 3,676 | 1,265 | 18,490 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
2020:
Overnight and continuous | Up to 30 days | 31-90 days | Greater than 90 days | Total | ||||||||||||||||
(in billions of yen) | ||||||||||||||||||||
2019 | ||||||||||||||||||||
Repurchase agreements | 2,596 | 8,537 | 2,403 | 1,104 | 14,640 | |||||||||||||||
Securities lending transactions | 1,012 | 473 | — | 313 | 1,798 | |||||||||||||||
Total | 3,608 | 9,010 | 2,403 | 1,417 | 16,438 | |||||||||||||||
2020 | ||||||||||||||||||||
Repurchase agreements | 6,357 | 5,467 | 4,867 | 1,280 | 17,971 | |||||||||||||||
Securities lending transactions | 877 | 231 | — | 316 | 1,424 | |||||||||||||||
Total | 7,234 | 5,698 | 4,867 | 1,596 | 19,395 | |||||||||||||||
Repurchase agreements | Securities lending transactions | |||||||
(in billions of yen) | ||||||||
2017 | ||||||||
Japanese government bonds and Japanese local government bonds | 1,127 | 1,152 | ||||||
Foreign government bonds and foreign agency mortgage-backed securities | 15,782 | 375 | ||||||
Commercial paper and corporate bonds | 294 | 47 | ||||||
Equity securities | 578 | 320 | ||||||
Other | 189 | 25 | ||||||
|
|
|
| |||||
Total(Note) | 17,970 | 1,919 | ||||||
|
|
|
| |||||
2018 | ||||||||
Japanese government bonds and Japanese local government bonds | 1,358 | 592 | ||||||
Foreign government bonds and foreign agency mortgage-backed securities | 14,426 | 303 | ||||||
Commercial paper and corporate bonds | 328 | 48 | ||||||
Equity securities | 406 | 869 | ||||||
Other | 139 | 21 | ||||||
|
|
|
| |||||
Total(Note) | 16,657 | 1,833 | ||||||
|
|
|
|
Repurchase agreements | Securities lending transactions | |||||||
(in billions of yen) | ||||||||
2019 | ||||||||
Japanese government bonds and Japanese local government bonds | 2,118 | 430 | ||||||
Foreign government bonds and foreign agency mortgage-backed securities | 11,613 | 396 | ||||||
Commercial paper and corporate bonds | 223 | 52 | ||||||
Equity securities | 492 | 902 | ||||||
Other | 194 | 18 | ||||||
Total (Note) | 14,640 | 1,798 | ||||||
2020 | ||||||||
Japanese government bonds and Japanese local government bonds | 1,790 | 269 | ||||||
Foreign government bonds and foreign agency mortgage-backed securities | 15,218 | 359 | ||||||
Commercial paper and corporate bonds | 273 | 50 | ||||||
Equity securities | 542 | 730 | ||||||
Other | 148 | 16 | ||||||
Total (Note) | 17,971 | 1,424 | ||||||
Note: | Amounts exceeded the gross amounts recognized in Note set-off or where uncertainty exists as to the enforceability. |
31.
32.
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
L oans | 7,954 | 7,268 | ||||||
Total assets | 28,674 | 27,036 | ||||||
Deposits | 10,167 | 8,665 | ||||||
Total liabilities | 26,387 | 25,014 | ||||||
Total equity | 2,287 | 2,022 | ||||||
Noncontrolling interests | 615 | 11 |
2018 | 2019 | 2020 | ||||||||||
(in billions of yen) | ||||||||||||
Total interest and dividend income | 458 | 503 | 586 | |||||||||
Total interest expense | 153 | 165 | 198 | |||||||||
Provision (credit) for loan losses | 66 | 84 | 81 | |||||||||
Net interest income after provision (credit) for loan losses | 239 | 254 | 307 | |||||||||
Income before income tax expense | 149 | 229 | 196 | |||||||||
Net income | 132 | 201 | 150 |
Specifically, the company system is classified into the following five 5
In line with the aforementioned system, the Group changed thesegments and constitute reportable segments from those based on the relevant principal consolidated subsidiaries to the five in-house companies. segments.
customers.
MIZUHO FINANCIAL GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Management does not use information onGAAP, and the total amount of all business segment’ssegments’ “Fixed assets” with the total amount of Premises and
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2016(3) | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (2)(4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | 754.8 | 425.0 | 400.6 | 577.7 | 51.0 | 12.5 | 2,221.6 | |||||||||||||||||||||
General and administrative expenses | 702.4 | 187.0 | 236.2 | 170.4 | 28.1 | 20.9 | 1,345.0 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 20.9 | 1.2 | 0.2 | — | 1.1 | 0.8 | 24.2 | |||||||||||||||||||||
Others | — | — | — | — | — | (48.0 | ) | (48.0 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Net business profits (losses) (1) | 73.3 | 239.2 | 164.6 | 407.3 | 24.0 | (55.6 | ) | 852.8 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2017 | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (2)(4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | 717.2 | 434.1 | 358.3 | 539.9 | 48.9 | (5.7 | ) | 2,092.7 | ||||||||||||||||||||
General and administrative expenses | 719.7 | 194.0 | 244.3 | 193.8 | 29.3 | 39.4 | 1,420.5 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 14.9 | 1.0 | 1.0 | — | 0.4 | 1.6 | 18.9 | |||||||||||||||||||||
Others | — | — | — | — | — | (27.7 | ) | (27.7 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Net business profits (losses) (1) | 12.4 | 241.1 | 115.0 | 346.1 | 20.0 | (71.2 | ) | 663.4 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2018 (5) | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits + Net gains (losses) related to ETFs and others (1) | 725.7 | 431.0 | 327.3 | 387.2 | 50.0 | 74.4 | 1,995.6 | |||||||||||||||||||||
General and administrative expenses (2) | 724.3 | 208.4 | 239.6 | 204.7 | 27.6 | 39.6 | 1,444.2 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 12.7 | 1.0 | 2.3 | — | 2.9 | 2.6 | 21.5 | |||||||||||||||||||||
Amortization of goodwill and others | 0.4 | 0.4 | 0.4 | 2.3 | 8.0 | 2.4 | 13.9 | |||||||||||||||||||||
Others | — | — | — | — | — | (21.0 | ) | (21.0 | ) | |||||||||||||||||||
Net business profits (losses) (3) + Net gains (losses) related to ETFs and others | 13.7 | 223.2 | 89.6 | 180.2 | 17.3 | 14.0 | 538.0 | |||||||||||||||||||||
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2019 (5) | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits + Net gains (losses) related to ETFs and others (1) | 705.9 | 473.4 | 400.3 | 192.4 | 49.6 | 6.1 | 1,827.7 | |||||||||||||||||||||
General and administrative expenses (2) | 713.5 | 205.7 | 237.9 | 207.5 | 27.3 | 48.7 | 1,440.6 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 18.1 | 0.9 | 7.2 | — | 1.3 | 23.7 | 51.2 | |||||||||||||||||||||
Amortization of goodwill and others | 0.4 | 0.4 | 0.4 | 2.3 | 8.0 | 2.1 | 13.6 | |||||||||||||||||||||
Others | — | — | — | — | — | (16.3 | ) | (16.3 | ) | |||||||||||||||||||
Net business profits (losses) (3) + Net gains (losses) related to ETFs and others | 10.1 | 268.2 | 169.2 | (17.4 | ) | 15.6 | (37.3 | ) | 408.4 | |||||||||||||||||||
Fixed assets (6) | 499.3 | 225.8 | 176.9 | 92.6 | 0.1 | 662.5 | 1,657.2 | |||||||||||||||||||||
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2018 | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (2) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits | 726.2 | 433.0 | 352.6 | 381.7 | 50.2 | (28.3 | ) | 1,915.4 | ||||||||||||||||||||
General and administrative expenses | 723.3 | 197.7 | 254.8 | 200.9 | 27.6 | 53.8 | 1,458.1 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 12.7 | 1.0 | 2.4 | — | 3.1 | 2.3 | 21.5 | |||||||||||||||||||||
Others | — | — | — | — | — | (21.0 | ) | (21.0 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||
Net business profits (losses) (1) | 15.6 | 236.3 | 100.2 | 180.8 | 25.7 | (100.8 | ) | 457.8 | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MHFG (Consolidated) | ||||||||||||||||||||||||||||
2020 | Retail & Business Banking Company | Corporate & Institutional Company | Global Corporate Company | Global Markets Company | Asset Management Company | Others (4) | Total | |||||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||||||
Gross profits + Net gains (losses) related to ETFs and others (1) | 673.6 | 462.4 | 417.8 | 410.1 | 48.4 | 60.5 | 2,072.8 | |||||||||||||||||||||
General and administrative expenses (2) | 668.5 | 215.1 | 249.0 | 208.9 | 29.0 | 41.0 | 1,411.5 | |||||||||||||||||||||
Equity in earnings (losses) of equity method investees—net | 11.8 | 2.0 | 10.3 | — | 1.3 | 5.0 | 30.4 | |||||||||||||||||||||
Amortization of goodwill and others | 0.4 | 0.4 | 0.4 | 2.3 | 7.8 | 1.9 | 13.2 | |||||||||||||||||||||
Others | — | — | — | — | — | (5.9 | ) | (5.9 | ) | |||||||||||||||||||
Net business profits (losses) (3) + Net gains (losses) related to ETFs and others | 16.5 | 248.9 | 178.7 | 198.9 | 12.9 | 16.7 | 672.6 | |||||||||||||||||||||
Fixed assets (6) | 503.7 | 204.1 | 173.0 | 91.5 | 0.1 | 767.4 | 1,739.8 | |||||||||||||||||||||
(1) | “Gross profits + Net gains (losses) related to ETFs and others” is reported instead of sales reported by general corporations. Gross profits is defined as the sum of net interest income, fiduciary income, net fee and commission income, net trading income and net other operating income. Net gains (losses) related to ETFs and others consist of net gains (losses) on ETFs held by MHBK and MHTB on their non-consolidated basis and net gains (losses) on operating investment securities of MHSC on its consolidated basis. For the fiscal years ended March 31, 2018, 2019 and 2020, net gains (losses) related to ETFs and others amounted to ¥80.2 billion, ¥15.0 billion and ¥10.6 billion, respectively, of which ¥70.1 billion, ¥7.3 billion and ¥7.3 billion are included in “Global Markets Company,” respectively. |
(2) | “General and administrative expenses” excludes non-allocated gains (losses), net. |
(3) | Net business profits (losses) is used in Japan as a measure of the profitability of core banking operations, and is defined as gross profits |
“Others” includes |
Beginning on April 1, |
practices. Income and expenses of foreign branches of MHBK and foreign subsidiaries with functional currencies other than Japanese Yen have been translated for purposes of segment reporting using the budgeted foreign currency rates. Prior period comparative amounts for such foreign currency income and expenses have been translated using current period budgeted foreign currency rates. |
(6) | “Fixed assets” is presented based on Japanese GAAP and corresponds to the total amount of the following U.S. GAAP accounts: Premises and equipment-net; Goodwill; Intangible assets; and ROU assets related to operating leases included in Other assets. The above table does not include other asset amounts because “Fixed assets” is the only balance sheet metric that management uses when evaluating and making decisions pertaining to the operating segments. “Fixed assets” has been allocated to each segment starting in the fiscal year ended March 31, 2019 to enhance management’s analysis of the Group’s operations. “Others” in “Fixed assets” includes assets of headquarters that have not been allocated to each segment, “Fixed assets” pertaining to consolidated subsidiaries that are not subject to allocation, consolidating adjustments, and others. Certain “Fixed assets” expenses have been allocated to each segment using reasonable allocation criteria. |
2016 | 2017 | 2018 | ||||||||||
(in billions of yen) | ||||||||||||
Net business profits | 852.8 | 663.4 | 457.8 | |||||||||
|
|
|
|
|
| |||||||
U.S. GAAP adjustments | 201.3 | (387.8 | ) | 17.8 | ||||||||
(Provision) credit for loan losses | (34.6 | ) | (37.7 | ) | 126.4 | |||||||
Net gains (losses) related to equity investments | 188.4 | 259.6 | 278.2 | |||||||||
Non-recurring personnel expense | (3.9 | ) | (8.8 | ) | (7.4 | ) | ||||||
Gains on disposal of premises and equipment | 10.2 | 5.6 | 8.2 | |||||||||
(Provision) credit for losses on off-balance-sheet instruments | 16.4 | (19.5 | ) | 30.2 | ||||||||
Others—net | (34.0 | ) | 5.6 | (71.9 | ) | |||||||
|
|
|
|
|
| |||||||
Income before income tax expense | 1,196.6 | 480.4 | 839.3 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in billions of yen) | ||||||||||||
Net business profits (losses) + Net gains (losses) related to ETFs and others | 538.0 | 408.4 | 672.6 | |||||||||
Adjustment to reconcile management reporting to Japanese GAAP: | ||||||||||||
General and administrative expenses: non-allocated gains (losses), net | (30.9 | ) | 23.3 | 46.3 | ||||||||
Expenses related to portfolio problems (including reversal of (provision for) general reserve for losses on loans) | (17.0 | ) | (30.7 | ) | (183.3 | ) | ||||||
Gains on reversal of reserves for possible losses on loans, and others | 173.3 | 11.2 | 11.6 | |||||||||
Net gains (losses) related to stocks—Net gains (losses) related to ETFs and others | 191.9 | 259.9 | 126.6 | |||||||||
Net extraordinary gains (losses) | 17.5 | (497.9 | ) | (19.2 | ) | |||||||
Others | (72.8 | ) | (57.9 | ) | (35.9 | ) | ||||||
Income before income tax expense under Japanese GAAP | 800.0 | 116.3 | 618.7 | |||||||||
Adjustment to reconcile Japanese GAAP to U.S. GAAP: | ||||||||||||
Derivative financial instruments and hedging activities | (110.2 | ) | 45.3 | 111.2 | ||||||||
Investments | 98.1 | (273.3 | ) | (480.9 | ) | |||||||
Loans | (2.4 | ) | (11.9 | ) | (3.0 | ) | ||||||
Allowances for loan losses and off-balance-sheet instruments | 6.8 | (5.8 | ) | 0.7 | ||||||||
Premises and equipment | 35.4 | 303.6 | (96.1 | ) | ||||||||
Land revaluation | 3.4 | 10.2 | 2.1 | |||||||||
Business combinations | 15.6 | (12.8 | ) | 6.0 | ||||||||
Pension liabilities | (4.4 | ) | (32.2 | ) | (56.7 | ) | ||||||
Consolidation of variable interest entities | 2.7 | (39.0 | ) | 39.3 | ||||||||
Foreign currency translation | 12.1 | 1.7 | 17.3 | |||||||||
Others | (17.8 | ) | (17.0 | ) | (5.1 | ) | ||||||
Income before income tax expense under U.S. GAAP | 839.3 | 85.1 | 153.5 | |||||||||
2019 | 2020 | |||||||
(in billions of yen) | ||||||||
Fixed assets | 1,657.2 | 1,739.8 | ||||||
U.S. GAAP adjustments (Note) | 413.1 | 887.2 | ||||||
Premises and equipment-net, Goodwill, Intangible assets, and ROU assets related to operating leases included in Other assets | 2,070.3 | 2,627.0 | ||||||
33.
Note: | The U.S. GAAP adjustments are primarily comprised of GAAP differences mainly from ROU assets related to operating leases not recognized under Japanese GAAP; internally developed software, which was impaired under Japanese GAAP; land, which was revalued under Japanese GAAP; and the consolidation of certain variable interest entities, which are not consolidated under Japanese GAAP. ROU assets are recognized on balance sheets in connection with the adoption of ASU No.2016-02 on April 1, 2019. |
Americas | ||||||||||||||||||||||||
Japan | United States of America | Others | Europe | Asia/Oceania excluding Japan, and others | Total | |||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Fiscal year ended March 31, 2016: | ||||||||||||||||||||||||
Total revenue(1) | 2,288.5 | 434.4 | 45.7 | 187.5 | 428.0 | 3,384.1 | ||||||||||||||||||
Total expenses(2) | 1,534.2 | 282.6 | 28.7 | 126.2 | 215.8 | 2,187.5 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Income before income tax expense | 754.3 | 151.8 | 17.0 | 61.3 | 212.2 | 1,196.6 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net income | 464.7 | 136.9 | 15.4 | 51.1 | 182.0 | 850.1 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total assets at end of fiscal year | 133,157.1 | 28,985.3 | 4,227.5 | 11,616.9 | 15,823.4 | 193,810.2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Fiscal year ended March 31, 2017: | ||||||||||||||||||||||||
Total revenue(1) | 1,748.3 | 500.3 | 70.3 | 190.7 | 367.5 | 2,877.1 | ||||||||||||||||||
Total expenses(2) | 1,712.3 | 303.2 | 29.1 | 136.2 | 215.9 | 2,396.7 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Income before income tax expense | 36.0 | 197.1 | 41.2 | 54.5 | 151.6 | 480.4 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net income | 5.7 | 167.6 | 38.8 | 39.5 | 137.5 | 389.1 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total assets at end of fiscal year | 138,832.3 | 30,262.0 | 4,203.3 | 10,629.1 | 16,529.6 | 200,456.3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Fiscal year ended March 31, 2018: | ||||||||||||||||||||||||
Total revenue(1) | 2,002.4 | 654.9 | 64.0 | 197.4 | 447.8 | 3,366.5 | ||||||||||||||||||
Total expenses(2) | 1,582.5 | 478.8 | 38.5 | 172.6 | 254.8 | 2,527.2 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Income before income tax expense | 419.9 | 176.1 | 25.5 | 24.8 | 193.0 | 839.3 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net income | 231.3 | 152.7 | 23.7 | 21.3 | 172.7 | 601.7 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Total assets at end of fiscal year | 142,587.8 | 28,135.9 | 4,380.4 | 11,677.8 | 17,473.7 | 204,255.6 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
Americas | ||||||||||||||||||||||||
Japan | United States of America | Others | Europe | Asia/Oceania excluding Japan, and others | Total | |||||||||||||||||||
(in billions of yen) | ||||||||||||||||||||||||
Fiscal year ended March 31, 2018: | ||||||||||||||||||||||||
Total revenue (1) | 2,002.4 | 654.9 | 64.0 | 197.4 | 447.8 | 3,366.5 | ||||||||||||||||||
Total expenses (2) | 1,582.5 | 478.8 | 38.5 | 172.6 | 254.8 | 2,527.2 | ||||||||||||||||||
Income before income tax expense | 419.9 | 176.1 | 25.5 | 24.8 | 193.0 | 839.3 | ||||||||||||||||||
Net income | 231.3 | 152.7 | 23.7 | 21.3 | 172.7 | 601.7 | ||||||||||||||||||
Total assets at end of fiscal year | 142,587.8 | 28,135.9 | 4,380.4 | 11,677.8 | 17,473.7 | 204,255.6 | ||||||||||||||||||
Fiscal year ended March 31, 2019: | ||||||||||||||||||||||||
Total revenue (1) | 1,705.5 | 792.1 | 66.0 | 249.7 | 616.5 | 3,429.8 | ||||||||||||||||||
Total expenses (2) | 2,082.6 | 696.5 | 46.1 | 203.2 | 316.3 | 3,344.7 | ||||||||||||||||||
Income (loss) before income tax expense | (377.1 | ) | 95.6 | 19.9 | 46.5 | 300.2 | 85.1 | |||||||||||||||||
Net income (loss) | (331.4 | ) | 85.3 | 17.0 | 34.6 | 270.2 | 75.7 | |||||||||||||||||
Total assets at end of fiscal year | 133,443.5 | 25,913.5 | 4,824.7 | 15,322.5 | 18,107.0 | 197,611.2 | ||||||||||||||||||
Fiscal year ended March 31, 2020: | ||||||||||||||||||||||||
Total revenue (1) | 1,681.0 | 801.5 | 95.1 | 270.4 | 610.9 | 3,458.9 | ||||||||||||||||||
Total expenses (2) | 2,008.9 | 679.2 | 41.5 | 239.1 | 336.7 | 3,305.4 | ||||||||||||||||||
Income (loss) before income tax expense | (327.9 | ) | 122.3 | 53.6 | 31.3 | 274.2 | 153.5 | |||||||||||||||||
Net income (loss) | (312.8 | ) | 100.4 | 51.5 | 23.6 | 243.6 | 106.3 | |||||||||||||||||
Total assets at end of fiscal year | 137,470.4 | 34,650.4 | 4,137.3 | 15,487.0 | 19,473.7 | 211,218.8 | ||||||||||||||||||
(1) | Total revenue is comprised of Interest and dividend income and Noninterest income. |
(2) | Total expenses are comprised of Interest expense, Provision (credit) for loan losses and Noninterest expenses. |
34.
2017 | 2018 | |||||||
(in millions of yen) | ||||||||
Assets: | ||||||||
Cash and due from banks | 15,912 | 22,264 | ||||||
Interest-bearing deposits in other banks | 4,278 | 1,227 | ||||||
Trading account assets | 131,996 | 176,593 | ||||||
Investments in subsidiaries and affiliated companies | 8,993,388 | 9,501,633 | ||||||
Long-term loans receivable from subsidiaries | 2,697,250 | 3,969,015 | ||||||
Other | 345,379 | 344,065 | ||||||
|
|
|
| |||||
Total | 12,188,203 | 14,014,797 | ||||||
|
|
|
| |||||
Liabilities and shareholders’ equity: | ||||||||
Short-term borrowings | 1,156,100 | 1,083,135 | ||||||
Long-term debt | 2,697,250 | 3,969,015 | ||||||
Other liabilities | 73,496 | 94,226 | ||||||
Shareholders’ equity | 8,261,357 | 8,868,421 | ||||||
|
|
|
| |||||
Total | 12,188,203 | 14,014,797 | ||||||
|
|
|
|
Condensed statements
2019 | 2020 | |||||||
(in millions of yen) | ||||||||
Assets: | ||||||||
Cash and due from banking subsidiaries | 99,209 | 43,016 | ||||||
Interest-bearing deposits in banking subsidiaries | 1,158 | 218 | ||||||
Investments in subsidiaries and affiliated companies: | ||||||||
Banking subsidiaries | 7,905,018 | 8,104,662 | ||||||
Non-banking subsidiaries and affiliated companies | 1,412,369 | 1,139,694 | ||||||
Long-term loans receivable from a banking subsidiary | 5,110,248 | 6,539,819 | ||||||
Other | 351,951 | 471,225 | ||||||
Total | 14,879,953 | 16,298,634 | ||||||
Liabilities and shareholders’ equity: | ||||||||
Short-term borrowings from a banking subsidiary | 945,505 | 860,000 | ||||||
Long-term debt | 5,145,286 | 6,555,053 | ||||||
Other liabilities | 62,643 | 371,216 | ||||||
Shareholders’ equity | 8,726,519 | 8,512,365 | ||||||
Total | 14,879,953 | 16,298,634 | ||||||
2016 | 2017 | 2018 | ||||||||||
(in millions of yen) | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | 850,492 | 362,440 | 577,608 | |||||||||
Adjustments and other | (546,946 | ) | (40,595 | ) | (302,109 | ) | ||||||
|
|
|
|
|
| |||||||
Net cash provided by operating activities | 303,546 | 321,845 | 275,499 | |||||||||
|
|
|
|
|
| |||||||
Cash flows from investing activities: | ||||||||||||
Net change in loans | (479,948 | ) | (2,022,860 | ) | (1,344,323 | ) | ||||||
Purchases of premises and equipment | (165 | ) | (40,362 | ) | (6,649 | ) | ||||||
Payments for purchases of securities of subsidiaries | (2,249 | ) | (65,269 | ) | — | |||||||
Proceeds from withdrawal of securities of subsidiaries | — | 13,359 | — | |||||||||
Net change in other investing activities | 1,872 | 6,691 | (1,063 | ) | ||||||||
|
|
|
|
|
| |||||||
Net cash used in investing activities | (480,490 | ) | (2,108,441 | ) | (1,352,035 | ) | ||||||
|
|
|
|
|
| |||||||
Cash flows from financing activities: | ||||||||||||
Net change in short-term borrowings | (10,000 | ) | (30,000 | ) | (70,000 | ) | ||||||
Proceeds from issuance of long-term debt | 479,948 | 2,022,860 | 1,344,323 | |||||||||
Repayment of long-term debt | (98,800 | ) | — | — | ||||||||
Proceeds from issuance of common stock | 5 | 6 | 3 | |||||||||
Purchases of treasury stock | (13 | ) | (1,435 | ) | (1,611 | ) | ||||||
Dividends paid | (195,283 | ) | (190,031 | ) | (190,382 | ) | ||||||
Net change in other financing activities | 1,001 | 971 | 555 | |||||||||
|
|
|
|
|
| |||||||
Net cash provided by financing activities | 176,858 | 1,802,371 | 1,082,888 | |||||||||
|
|
|
|
|
| |||||||
Net increase (decrease) in cash and due from banks | (86 | ) | 15,775 | 6,352 | ||||||||
Cash and due from banks at beginning of fiscal year | 223 | 137 | 15,912 | |||||||||
|
|
|
|
|
| |||||||
Cash and due from banks at end of fiscal year | 137 | 15,912 | 22,264 | |||||||||
|
|
|
|
|
|
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Income: | ||||||||||||
Dividends from subsidiaries and affiliated companies: | ||||||||||||
Banking subsidiaries | 227,057 | 267,724 | 23,824 | |||||||||
Non-banking subsidiaries and affiliated companies | 28,987 | 23,392 | 12,850 | |||||||||
Management fees from subsidiaries | 47,945 | 39,292 | 38,004 | |||||||||
Interest income on loans and discounts | 68,869 | 106,920 | 123,354 | |||||||||
Gains on disposal of premises and equipment | — | — | 10,866 | |||||||||
Other income | 52,672 | 9,575 | 7,088 | |||||||||
Total | 425,530 | 446,903 | 215,986 | |||||||||
Expenses: | ||||||||||||
Operating expenses | 38,661 | 40,680 | 38,951 | |||||||||
Interest expense | 74,227 | 110,861 | 126,516 | |||||||||
Other expense | 28,123 | 59,049 | 25,313 | |||||||||
Total | 141,011 | 210,590 | 190,780 | |||||||||
Equity in undistributed net income (loss) of subsidiaries | 309,210 | (173,142 | ) | 130,930 | ||||||||
Income before income tax expense | 593,729 | 63,171 | 156,136 | |||||||||
Income tax expense (benefit) | 16,121 | (21,300 | ) | 5,941 | ||||||||
Net income | 577,608 | 84,471 | 150,195 | |||||||||
35.
2018 | 2019 | 2020 | ||||||||||
(in millions of yen) | ||||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | 577,608 | 84,471 | 150,195 | |||||||||
Adjustments and other | (302,109 | ) | 197,193 | (92,059 | ) | |||||||
Net cash provided by operating activities | 275,499 | 281,664 | 58,136 | |||||||||
Cash flows from investing activities: | ||||||||||||
Proceeds from sales of Equity securities | — | 139,719 | — | |||||||||
Net change in loans | (1,344,323 | ) | (1,075,059 | ) | (1,496,047 | ) | ||||||
Purchases of premises and equipment | (6,649 | ) | (11,640 | ) | (43,406 | ) | ||||||
Proceeds from sales of premises and equipment | — | — | 209,657 | |||||||||
Net change in other investing activities | (4,114 | ) | (1,310 | ) | (5,150 | ) | ||||||
Net cash used in investing activities | (1,355,086 | ) | (948,290 | ) | (1,334,946 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Net change in short-term borrowings | (70,000 | ) | (140,000 | ) | (85,505 | ) | ||||||
Proceeds from issuance of long-term debt | 1,344,323 | 1,075,059 | 1,531,047 | |||||||||
Repayment of long-term debt | — | — | (35,000 | ) | ||||||||
Proceeds from issuance of common stock | 3 | 3 | — | |||||||||
Purchases of treasury stock | (1,611 | ) | (2,124 | ) | (1,441 | ) | ||||||
Dividends paid | (190,382 | ) | (190,413 | ) | (190,386 | ) | ||||||
Net change in other financing activities | 555 | 437 | 962 | |||||||||
Net cash provided by financing activities | 1,082,888 | 742,962 | 1,219,677 | |||||||||
Effect of exchange rate changes on cash and cash equivalents | — | 540 | — | |||||||||
Net increase (decrease) in cash and cash equivalents | 3,301 | 76,876 | (57,133 | ) | ||||||||
Cash and cash equivalents at beginning of fiscal year | 20,190 | 23,491 | 100,367 | |||||||||
Cash and cash equivalents at end of fiscal year | 23,491 | 100,367 | 43,234 | |||||||||
Redemption
MHFG’s common stock
|
| ||||||
| |||||||
| Exhibit Number | Description of |
EXHIBIT INDEX
| 1.1 |
| ||
| ||||
1.2 | ||||
1.3 | ||||
2.1 | ||||
2.2 | ||||
2.3 | ||||
2.4 | ||||
8 | ||||
11 | ||||
12.1 | ||||
12.2 | ||||
13.1 | ||||
15 | ||||
101.INS | Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||
101.SCH | Inline XBRL Taxonomy Extension Schema | |||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase | |||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase | |||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase | |||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase | |||
104 | The cover page for the Company’s Annual Report on From 20-F for the year ended March 31, 2020, has been formatted in Inline XBRL |
* | Incorporated by reference to our annual report on Form 20-F (No. 001-33098) filed on July |
** | Incorporated by reference to our annual report on Form 20-F (No. 001-33098) filed on July 21, 2016. |
MIZUHO FINANCIAL GROUP, INC. | ||
| ||
By: | /s/ Tatsufumi Sakai | |
Name: | Tatsufumi Sakai | |
Title: | President & Group CEO |