Information Meeting The Year Ended March 2010

June 11, 2010

THE NANTO BANK, LTD Table of Contents

I. Financial Results for FY2009 II. Management Strategy

Financial Results for FY2009 1 Outline of Business Area 12 1. Summary of Profit and Loss 2 Corporate Banking Policies 2. Summary of Core Net Business Profit 3 1. Focus on Business Area 13 3. Deposits 4 2. Business Development Structure 14 4. Loans 5 Retail Banking Policies 5. Securities 6 1. Business Development Structure 15 6. Disposal of Non-Performing Loans 8 2. Target on Middle and Affluent Clients 16 7. Capital Adequacy Ratio 9 3. Promoting Retail Transactions Business Forecast for FY2010 10 as a Main Bank 17 4. Reinforcing Personal Loans 18 5. Channel Strategy 19

Appendix1-13 表紙Ⅰ

I. Financial Results for FY2009

II. Management Strategy

1 Financial Results for FY2009 – 1. Summary of Profit and Loss

FY2009 (¥ billion) FY2008 Y/Y change ? Core net business profit rose ¥200 million year on year to ¥16.4 billion 1 Core gross business profit 66.3 65.6 -0.7 because even though real net interest income, which deducts cost of 2 Interest income 63.0 59.3 -3.6 derivative financial products, and fees and commissions declined, 3 Fees and commissions 6.3 6.0 -0.3 expenses also declined ¥0.9 billion. 4 Other operating income (*1) (3.0) 0.2 +3.2 5 Cost of derivative financial products 3.3 - -3.3 FY2009 (¥ billion) FY2008 Y/Y 6 Expenses 50.2 49.2 -0.9 Change 7 Personnel expenses 26.2 26.2 -0.0 Net interest income 63.0 59.3 -3.6 [Real net interest income] [59.6] [59.3] [-0.3] 8 Non-personnel expenses 21.5 21.0 -0.4 Interest on loans and deposits 42.7 42.6 -0.1 9 Taxes 2.4 1.9 -0.4 Interest on loans 53.9 50.9 -2.9 10 Core net business profit 16.1 16.4 +0.2 Interest on deposits 11.1 8.3 -2.8 Interest on market sector 20.1 16.6 -3.5 11 Gains/Losses on bonds (JGBs, etc.) (13.0) 2.7 +15.8 [Real interest on market sector] [16.8] [16.6] [-0.1] Net transfer to general provision for Interest on securities 21.9 17.9 -4.0 12 - 1.7 +1.7 possible loan losses Interest on fund management 1.1 0.3 -0.8 Interest on fund procurement 2.9 1.5 -1.4 13 Net business profit 3.0 17.4 +14.3 [Cost of derivative financial [3.3] [-] [-3.3] 14 Non-recurrent gains/losses (30.6) (7.0) +23.5 products] 15 Gains/Losses on stocks (17.3) (0.2) +17.1 16 Disposal of non-performing loans 11.4 5.2 -6.2 17 Retirement benefit costs 1.9 2.6 +0.6 ? Net income increased ¥29.6 billion year on year to ¥7.3 billion because of an increase in core net business profit, a ¥32.9 billion improvement in 18 Ordinary income (27.5) 10.4 +37.9 gains/losses on securities, a ¥3.2 billion decline in credit costs, and other 19 Extraordinary gains/losses 2.7 1.5 -1.1 reasons. 20 Bad debt recovered 1.0 1.7 +0.6 Reversal of provision for possible loan FY2009 21 1.8 - -1.8 (¥ billion) FY2008 loss Y/Y Change 22 Income before taxes (24.8) 11.9 +36.7 Gains/losses on securities (30.4) 2.5 +32.9 Gains/Losses on bonds (JGBs, etc.) (13.0) 2.7 +15.8 23 Net income (22.3) 7.3 +29.6 Gains/Losses on stocks (17.3) (0.2) +17.1 Credit cost 8.4 5.2 -3.2 Net transfer to general provision for 24 Credit cost (*2) 8.4 5.2 -3.2 (2.2) 1.7 +3.9 possible loan losses Disposal of non-performing loans 11.7 5.2 -6.5 *1 Except bonds (ex. Government Bonds) gains/losses Bad debt recovered 1.0 1.7 +0.6 *2 (Net transfer to general provision for possible loan losses + Disposal of non-performing loans) – (Bad debt recovered) 2 Financial Results for FY2009 – 2. Summary of Core Net Business Profit

Factor Analysis of Changes in Core Net Business Profit (¥ billion)

Profit increase factor Profit decrease factor 1) Average balance of loans ¥2,751.0 billion (Y/Y change +¥48.1 billion)

Core net business profit for FY2008 16.1 2) Interest rate on loans 1.85% (Y/Y change -0.14%)

1) Average balance of loans +0.9 3) Average balance of deposits ¥4,126.9 billion Lending/ (Y/Y change +¥94.0 billion) 2) Interest rate on loans -3.9 deposit operations 4) Interest rate on deposits 0.20% (Y/Y change -0.07%) 3) Average balance of deposits -0.2 -¥0.1 billion 5) Average balance of securities ¥1,481.2 billion (Y/Y change -¥59.1 billion) 4) Interest rate on deposits +3.0 6) Yield on securities 1.21% (Y/Y change -0.21%) 5) Average balance of securities -0.8 7) Interest on fund management, etc. 6) Yield on securities Y/Y change -¥0.8 billion -3.2 7) Interest on fund Market 8) Interest on fund procurement, etc. management, etc. operations Y/Y change -¥1.4 billion -0.8 -¥0.1 billion Cost of derivative financial products 8) Interest on fund Y/Y change -¥3.3 billion procurement, etc. Cost of derivative financial +4.7 9) Fees from exchange transactions and products debit transfer, etc. Y/Y change -¥0.47 billion Commissions from investment trust and insurance 9) Fees and commissions -0.3 Y/Y change +¥0.18 billion 10)Expenses +0.9 10)Personnel expenses Y/Y change -¥0.0 billion Non-personnel expenses Y/Y change -¥0.4 billion 11)Others -0.0 Taxes Y/Y change -¥0.4 billion ? Factors behind the increases included Core net business profit for FY2009 16.4 depreciation of software for the regional bank partnership

3 Financial Results for FY2009 – 3. Deposits

AverageAverage BalanceBalance ofof DepositsDeposits byby SectorSector AverageAverage BalanceBalance ofof DepositsDeposits byby PrefecturePrefecture

? The average balance of deposits during FY2009 rose ¥94.0 billion year ? Deposits for all prefectures rose year on year. on year to ¥4,126.9 billion since mainly personal deposits steadily During FY2009, the average balance of deposits for Prefecture increased. was ¥3,317.2 billion, which accounted for 80.4% of Nanto Bank’s total deposits.

Average balance (¥ billion) Interest rate (%) Average balance (¥ billion) 4,500.0 0.50 4,500.0 4,047.9 4,032.8 4,126.9 140.7 102.7 104.3 162.9 297.1 164.5 164.3 323.1 286.7 290.1 292.8 304.8 589.3 613.8 607.0 190.9 195.2 207.5

0.28 0.27

0.20

3,317.2 3,135.7 3,176.4 3,245.7 3,243.7 3,257.9

0 0.00 0 FY2007 FY2008 FY2009 FY2007 FY2008 FY2009 Personal Corporate Government/Banks Nara Pref. Osaka Pref. Pref. Other Pref. Negotiable CD Interest rate on deposits

4 Financial Results for FY2009 – 4. Loans

AverageAverage BalanceBalance ofof LoansLoans byby SectorSector AverageAverage BalanceBalance ofof LoansLoans byby PrefecturePrefecture ? Loans outstanding for FY2009 amounted to ¥2,751.0 billion, a year-on- year increase of ¥48.1 billion due to increases in both wholesale loans 1,000.0 909.7 921.3 894.4 and personal loans. (¥ billion) （億円) 134.1 134.5 135.6 Average balance (¥ billion) Interest rate (%) 3,500.0 2.01 1.99 2.10 221.3 240.0 232.2 1.85

2,702.9 2,751.0 2,579.8 554.2 546.7 526.6 344.1 363.0 336.4 0 FY2007 FY2008 FY2009 575.8 611.7 537.1 Nara Pref. Osaka Pref. Others 1,000.0 (¥ billion) 861.5 881.7 921.3 894.4 909.7 796.4 151.7 155.6 140.2 165.6 173.0 135.7

796.4 861.5 881.7 520.4 544.2 553.0 0 0.00 FY2007 FY2008 FY2009 Personal loans Retail business loans Wholesale loans 0 Loans for local government Interest rate on loans FY2007 FY2008 FY2009 Nara Pref. Osaka Pref. Others 5 Financial Results for FY2009 – 5. Securities-1

Gains/LossesGains/Losses onon SecuritiesSecurities No.2 Gains/losses on bonds ¥2.7 bn No.3 Gain on disposal of bonds ¥3.7 bn (¥ billion) (Securitized products ¥2.5 bn, Japanese government bonds ¥1.0 bn, Foreign bonds ¥0.1 bn, etc.) FY2008 FY2009 Y/Y Change No.5 Loss on disposal of bonds ¥0.6 bn (Japanese government bonds ¥0.5 bn, etc.) 1 Gains/losses on securities (30.4) 2.5 +32.9 No.8 Gains/losses on stocks -¥0.2 bn Gains/losses on bonds (Japanese No.11 Write-offs ¥0.7 bn 2 government bonds, etc.) (13.0) 2.7 +15.8 (Impairment loss due to 30% or more decline in value ¥0.7 bn) 3 Gain on disposal of bonds 4.4 3.7 -0.7 4 Gain on redemption of bonds 0.1 - -0.1

5 Loss on disposal of bonds 2.2 0.6 -1.5 < Securitized products for losses on bonds > (¥ billion) 6 Loss on redemption of bonds 11.5 0.1 -11.3 As of Mar. 31, 2008 As of Mar. 31, 2009 As of Mar. 31, 2010 7 Write-offs Number of Number of Number of 3.8 0.0 -0.0 Book Book Book stocks stocks stocks 8 Gains/losses on stocks (17.3) (0.2) +17.1 value value value traded traded traded 9 Gain on disposal of stocks 5.1 0.6 -4.4 Synthetic CDO 10 14.33 8 3.98 1 0.11 10 Loss on disposal of stocks 1.2 0.1 -1.1 CDO 2 0.57 0 0.0 0 0.0 11 Write-offs 21.3 0.7 -20.5 Capital note 9 1.48 9 0.08 0 0.0 Total 21 16.39 17 4.06 1 0.11 UnrealizedUnrealized Gains/LossesGains/Losses ofof SecuritiesSecurities * From the end of Sep. 2008, fair value of floating rate bonds is reasonably calculated based on “Practical Solution on Measurement of Fair Value Bonds Stocks Other (¥ billion) +30.2 Financial Assets” (ASBJ PITF No.25). 40.0 14.8 < Breakdown of other securities> (¥ billion) 30.0 As of Mar. 31, 2008 As of Mar. 31, 2009 As of Mar. 31, 2010 -9.0 20.0 Book Unrealized Book Unrealized Book Change Unrealized Change -16.9 value Gain/loss value Gain/loss value from Gain/loss from Mar. 2009 Mar. 2009 1.2 24.8 10.0 15.5 1 Other 384.6 -13.2 282.5 -26.1 288.0 5.5 -9.4 16.7 8.0 2 Overseas securities 362.9 -11.7 269.8 -25.1 271.9 2.1 -9.2 15.9 0 3 Government bonds 55.6 -1.6 28.0 0.4 82.9 54.9 1.1 0.7 -11.3 -9.4 Government guaranteed bonds, 4 0.0 0.0 11.9 0.1 9.9 -2.0 0.2 0.1 -10.0 etc. -26.1 5 Corporate bonds 141.3 -2.9 132.1 -7.7 88.9 -43.2 2.4 10.1 -13.2 -20.0 6 Other foreign securities 165.9 -7.1 97.7 -17.9 90.0 -7.7 -13.0 4.9 Other securities (investment trust, J- 7 21.6 -1.4 12.6 -0.9 16.1 3.5 -0.2 0.7 -30.0 As of As of As of REIT, investment partnership), etc. Mar. 31, 2008 Mar. 31, 2009 Mar. 31, 2010 6 Financial Results for FY2009 – 5. Securities-2

BalanceBalance ofof OutstandingOutstanding SecuritiesSecurities AssetAsset ManagementManagement PlanPlan forfor FY2010FY2010

Japanese government bonds (domestic) Local government bonds (domestic) Other domestic bonds Foreign securities (excluding stocks) Building of a sound portfolio which leads to stable return with Stocks (domestic and overseas) Other securities (¥ billion) control of risk 1,549.8 1,530.2 1,443.4 18.5 13.8 Increase, based on the expectation for prolonged low-interest Yen- policy 1,500.0 87.3 9.7 75.3 Denominated • Continue to build a ladder portfolio centered around Japanese government bonds Bonds • Increase investment returns through active trading, options usage, etc. 71.2 271.9 362.9 Increase slightly, based on the outlook for a mild recovery 269.8 Japanese • Build a high quality equity portfolio for net investment purpose through adjusting 48.5 and the portfolio mix U.S. Stocks • Build earnings through active trading of stock funds 81.6 1,000.0 144.3 222.2

228.8 Increase slightly, based on the large spread between acquisition cost and investment returns for dollar-denominated bonds 281.0 Foreign Bonds Shift from euro-denominated bonds to yen-denominated bonds • Continue investment focused on safe, liquid U.S. government bonds

500.0 BBondond DDurationuration 898.3 782.1 (Year) Yen-denominated bonds Dollar, Euro-denominated bonds Total 655.6 3.5 3.2 3.0 3.0 2.9 3.0 3.1 2.9 2.5 2.8 2.5 0 2.3 2.3 2.3 End-Mar. 2008 End-Mar. 2009 End-Mar. 2010 2.3 2.2 1.9 * Book value basis 2.0 (after deduction of appraisal profit and loss of securities) 1.6

1.5 End-Mar. 2008 End-Sep. 2008 End-Mar. 2009 End-Sep. 2009 End-Mar. 2010 7 Financial Results for FY2009 – 6. Disposal of Non-Performing Loans

CreditCredit CostCost BreakdownBreakdown ofof CreditCredit CostCost

Core net business profit Credit cost Credit cost ratio Disposal of non-performing loans Net transfer to general provision for possible loan losses Bad debt recovered (¥ billion) (%) 30.0 0.69 0.75 (¥ billion) 0.62 20.0 0.53 20.9 20.5 20.5 3.4 20.0 0.50 17.1 17.7 16.4 15.4 16.1 22.4 12.9 0.31 10.0 17.3 15.9 1.7 10.0 8.4 0.19 0.25 11.7 5.2 5.2 2.9 0 -0.9 -0.2 -2.2 -1.5 0 0.00 -8.1 -0.9 -7.1 -1.0 -1.7 -4.4 -1.3 -0.17 -10.0 -10.0 -0.25 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 Credit Cost 12.9 15.4 17.7 -4.4 8.4 5.2

DisposalDisposal ofof NNonon--PPerformingerforming LLoansoans byby RRegionegion CreditsCredits DisclosedDisclosed underunder thethe FinancialFinancial ReconstructionReconstruction LawLaw // NonNon--performingperforming Loans Loans Ratio Ratio

(¥ billion) 15.0 Loans to bankrupt and Loans to potentially Osaka Pref. (¥ billion) quasi-bankrupt debtors bankrupt debtors (%) 13.0 Nara Pref. 200.0 5.46 Loans to substandard Non-performing loans ratio 6.00 debtors Other Pref. 4.34 4.44 3.86 6.1 27.9 3.32 3.12 4.2 100.0 31.5 31.4 3.00 2.8 2.5 34.3 2.1 25.9 1.4 18.9 1.4 2.8 97.9 0.6 1.3 66.4 78.2 64.4 60.7 54.0

12.9 15.5 13.5 -2.8 0 9.6 6.6 9.5 0.00 As of As of As of As of As of As of -5.0 Mar. 31, 2005 Mar. 31, 2006 Mar. 31, 2007 Mar. 31, 2008 Mar. 31, 2009 Mar. 31, 2010 FY2006 FY2007 FY2008 FY2009 Total 138.8 113.5 119.3 105.4 96.2 86.5 8 Financial Results for FY2009 – 7. Capital Adequacy Ratio

CapitalCapital AdequacyAdequacy RatioRatio

Capital Tier I As of Mar. As of Sep. As of Mar. As of Sep. As of Mar. (¥ billion, %) Change Capital adequacy ratio Tier I ratio 31, 2008 30, 2008 31, 2009 30, 2009 31, 2010 from Mar. 2009 (¥ billion) 11.88 (%) 1 Tier I 191.2 186.5 172.3 176.3 177.9 +5.6 400.0 12.00 2 Of which, 20.0 20.0 20.0 20.0 20.0 - preferred securities 10.57 10.53 10.33 3 Tier II 33.0 32.7 32.8 32.4 51.9 +19.1 9.82 4 General provision for possible loan losses 13.0 12.7 12.8 12.4 11.9 -0.9 9.17 9.17 9.30 5 Hybrid debt capital 8.85 instruments 20.0 20.0 20.0 20.0 40.0 +20.0 8.38 6 Deductions 4.5 4.2 3.2 2.8 2.6 -0.6 7 Capital 219.7 215.0 201.9 205.9 227.2 +25.3 8 Risk weighted assets 2,084.8 2,032.4 2,055.6 1,992.6 1,912.2 -143.4 227.2 9 219.7 215.0 Credit-risk assets 1,960.4 1,906.1 1,931.0 1,868.3 1,788.3 -142.7 201.9 205.9 10 Amount equivalent to operational risk 124.4 126.3 124.5 124.2 123.9 -0.6

11 Capital adequacy ratio (No.7 / No.8 ? 100) 10.53 10.57 9.82 10.33 11.88 +2.06 12 Tier I ratio (No.1 / No.8 ? 100) 9.17 9.17 8.38 8.85 9.30 +0.92

13 Core Tier I ratio* 6.18 5.98 5.39 6.14 6.75 +1.36 191.2 14 Deferred tax assets 45.0 47.7 43.8 36.1 30.9 -12.9 186.5 172.3 176.3 177.9 15 Deferred tax assets ratio 23.5 25.5 25.4 20.4 17.3 -8.1 (No.14 / No.1 ? 100)

* Core Tier I ratio = (Tier I – Preferred securities – Deferred tax assets) / (Risk weighted assets – Deferred tax assets ) 0 0.00 As of Mar. As of Sep. As of Mar. As of Sep. As of Mar. (As of March 31, 2010) 31, 2008 30, 2008 31, 2009 30, 2009 31, 2010 ?99 percentile method • Amount of interest-rate risk ¥25.9 billion * Calculated by standard method of Basle II from March 2007 • Outlier ratio 11.2% As for risk-weighted assets, calculated by “credit risk = standard method”, “Operational risk = basic method” * Core deposit model was introduced in demand deposit from the Unrealized gains/losses on floating rate bonds are calculated based on theoretical end of September 2009. price from September 2008. 9 Business Forecast for FY2010

(¥ billion) FY2009 FY2010 ? Real net interest income is expected to increase by ¥1.6 billion year on Forecast Y/Y change year due to an increase in interest on market sector income, including 1 Core gross business profit 65.6 68.0 +2.3 interest on loans and deposits, and deducting the cost of derivative financial products. 2 Interest income 59.3 61.0 +1.6 Fees and commissions are also expected to increase, by ¥700 3 Fees and commissions 6.0 6.7 +0.7 million, but an anticipated ¥2.1 billion increase in expenses is forecast 4 Other operating income (*1) 0.2 0.2 -0.0 to hold core net business profit to ¥16.7 billion, an increase of ¥200 million year on year. 5 Cost of derivative financial products - 0.0 +0.0 6 FY2010 Expenses 49.2 51.3 +2.1 (¥ billion) FY2009 Forecast 7 Personnel expenses 26.2 26.3 +0.1 Y/Y Change Net interest income 59.3 61.0 +1.6 8 Non-personnel expenses 21.0 22.7 +1.7 [Real net interest income] [59.3] [60.9] [+1.6] Interest on loans and deposits 42.6 42.9 +0.2 9 Taxes 1.9 2.1 +0.2 Interest on loans 50.9 49.3 -1.6 10 Core net business profit 16.4 16.7 +0.2 Interest on deposits 8.3 6.4 -1.8 Interest on market sector 16.6 18.0 +1.4 11 Gains/Losses on bonds (JGBs, etc.) 2.7 0.6 -2.1 [Real interest on market sector] [16.6] [18.0] [+1.3] 12 Net transfer to general provision for possible loan 1.7 (0.3) -2.0 Interest on securities 17.9 19.9 +2.0 losses Interest on fund management 0.3 0.2 -0.0 13 Net business profit 17.4 17.6 +0.1 Interest on fund procurement 1.5 2.1 +0.5 14 Non-recurrent gains/losses (7.0) (7.6) -0.5 [Cost of derivative financial products] [-] [0.0] [+0.0] 15 Gains/Losses on stocks (0.2) - +0.2 16 Disposal of non-performing loans 5.2 6.5 +1.2 17 Ordinary income 10.4 10.0 -0.4 ? Though credit costs should remain basically unchanged, net income is forecast to decline ¥1.2 billion, to ¥6.0 billion, due to a decline in gains on 18 Extraordinary gains/losses 1.5 0.8 -0.7 securities. 19 Bad debt recovered 1.7 1.0 -0.7 20 Income before taxes 11.9 10.8 -1.1 FY2010 (¥ billion) FY2009 Forecast 21 Net income 7.3 6.0 -1.2 Y/Y Change Gains/Losses on securities 2.5 0.6 -1.9 22 Credit cost (*2) 5.2 5.2 -0.0 Gains/Losses on bonds (JGBs, etc.) 2.7 0.6 -2.1 Gains/Losses on stocks (0.2) - +0.2 *1 Except bonds (ex. Government Bonds) gains/losses Credit cost 5.2 5.2 -0.0 *2 (Net transfer to general provision for possible loan losses + Disposal of non-performing Net transfer to general provision for 1.7 (0.3) -2.0 loans) – (Bad debt recovered) possible loan losses Disposal of non-performing loans 5.2 6.5 +1.2 Recoveries of write-offs 1.7 1.0 -0.7 10 表紙Ⅰ

I. Financial Results for FY2009

II. Management Strategy

11 Outline of Business Area

No. Indicator Nara Osaka No. Indicator Prefecture National Prefecture National Source [Branches] Nara Pref. 92, Osaka Pref. 13, Kyoto Pref. 15, ranking ranking Pref. 7, Mie Pref. 3, Hyogo Pref. 1, 1 1 Population 1,404 thousand 29 8,8068,806 thousand thousand 3 2008 Population Census [Housing loan centers] 8 locations; Nara, Heijo, Gakuenmae, Ikoma, Number of private enterprises 2006 Establishment and 2 48 thousand 40 421421 thousand thousand 2 Mamigaoka, Kashihara, Oji, Osaka (offices) Enterprise Census 2008 Ministry of Land, Infrastructure, [Everyday-life Consultation Office] 6 locations 3 Housing starts 88 thousandthousand 30 7676 thousand thousand 4 Transportation and Tourism 、 ¥10.10.43 trillion ¥79.79.94 trillion trillion Kinyu Journal Saidaiji, Heijo, Gakuen-mae, Mamigaoka, Rinkan-eki-mae 4 Deposits balance 22 2 “Regional Financial Map 2010” Gardenmall Kizugawa Kinyu Journal 5 Loans balance ¥3.3.21 trillion 30 ¥45.45.90 trillion trillion 2 “Regional Financial Map 2010” Personal savings 2008 Bank of 6 (per capita) ¥5,8913,366 thousand 64 ¥3,8916,004thousand thousand 25 Newspapers subscriptions (¥ billion, As of Mar. 31, 2010) 7 1.31.375 1 10.99.06 3217 2008Japan Newspaper Association “Kansai Science City” (per household) • Population: approx. 230 thousand Number of residents traveling 2007 Annual Report of Statistics Deposits balance Kyoto Pref. 8 1163.5859.37 45 15156.071.69 76 on Legal Migrants (Planned population: 410 thousand abroad (per 1,000 people) Number of households with piano 2004 National Survey of Family Loans balance 302.6 190.9 people) 9 353353 2 256256 33 • Area: approx. 15,000 ha (per 1,000 households) Income and Expenditure • Academic/cultural research Employment rate outside the 29.32% 1 5.11%5.11% 2005 Population Census Hyogo Pref. facilities: approx. 100 10 Prefecture 15 1.2 8.6 (Per household (with more than 2 people) basis Source: Ministry of Internal Affairs and Communications ) Around 30 minutes from ?Nara city central Nara to Osaka city Mie Pref. CY2008: ¥23.89 million (Nation’s top rank) Around 50 minutes from Kintetsu Nara 62.0 24.6 to Hanshin Amagasaki in Hyogo Prefecture ?Well-developed office network ? Osaka Pref. ?Maintained approx. 50% of deposit =>Retail market and loan market share in Nara Pref. ＋ ?Osaka prefecture 563.3 Nara Pref. ?Osaka Pref. which adjoins Nara Pref. 200.1 has the second largest economy in =>Business market Japan. 3,299.9 Tokyo Metropolis 376.7 14.9 < Nanto Bank’s Growth Scenario > Wakayama Pref. 1,506.1 ?Priority strategic areas • Nanto Bank will increase business loans and personal loans and strive to expand and strengthen sales offices in areas such as Osaka, which 165.4 72.0 are the bank’s important strategic areas. ?Existing area centered on Nara prefecture • Nanto Bank will make a detailed breakdown of customer segments, develop more strategic business activities, and promote asset ■ ＝NANTO BANK branches and offices management products and personal loans. （As of Mar. 31, 2010） 12 Corporate Banking Policies -1 (Osaka Strategy） New Strategic Forces in Osaka New Strategic Forces in Osaka Hyogo Prefecture Amagasaki Branch Osaka Osaka-Chuo Office (Established: Sep. 2009) Prefecture (Established: Jun. 2008) 1) Oct.2000, established Higashi-Osaka Corporate Business Office -> Oct.2002 Osaka-Higashi Shin-Osaka Kyoto Branch Prefecture Osaka City Daitoh 2) Oct.2000, established Yao Corporate Business Office -> Apr.2004 Yao Branch Osaka-Kita Ishikiri Yoshida (Transfer of the Yao-Minami Office) Osaka-Higashi Osaka 3) Oct.2001, established Daitoh Corporate Business Office -> Dec.2003 Daitoh Branch Osaka-Nishi Corporate Yao 4) Jan.2003, established Osaka Corporate Business Office ->Jun.2008 incorporated into Business Office Osaka-Minami Corporate (Established: Nov. 2008) Business Office Osaka-Chuo Office Sakai (Established: Nov. 2008) 5) Jun.2003, established Osaka-Kita Corporate Office -> Jan.2004 Osaka-Kita Branch Habikino Nara 6) Jun.2004, established Sakai Corporate Business Office -> Nov.2005 Sakai Branch Prefecture 7) Aug.2005, established Shin-Osaka Corporate Business Office -> Aug.2006 Shin-Osaka Branch Kawachi-nagano 8) Oct.2007, established Amagasaki Corporate Business Office -> Sep. 2009 Amagasaki Branch Izumisano 9) Jun.2008, established Osaka-Chuo Office 10) Nov.2008, established Osaka-Minami Corporate Business Office Wakayama Prefecture 11) 〃 established Osaka-Nishi Corporate Business Office ＝Newly established branches 和歌山県(In and after 2002)

ChangeChange inin OutstandingOutstanding LoansLoans inin OsakaOsaka Pref.Pref. StrengthenStrengthen RelationshipsRelationships withwith ClientClient CompaniesCompanies

578.0 600 Corporate Retail Office Strengthen tie-ups and relationships with client companies, established “Nanto (¥ billion) Personal loans Local government Clubs” in branches located in Osaka Prefecture. ☆ ： Lending balance doubled within 10 years Osaka-Chuo ☆Loans composition：shifted from Corporate to Retail loans 17 Composition ratio Osaka Club Sakai 71% Club Club 306.0 Osaka-Kita Habikino Composition Club Club ratio 31% Shin-Osaka Izumisano Club Clients Club Yosida Yao Club Club

Kawachinagano Osaka-Higashi Club 0 Club Ishikiri Daitoh FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 Club Club 13 Corporate Banking Policies -2 (Business Promotion System) BusinessBusiness StructureStructure Clients Channels

Large Corporate Banking Office Target corporations Corporate Solutions Group Branches Branch Office Manager Business Corporate Business Promotion Staff Venture Business Support Office

Scale Promotion Semi-target System Regional Promoter ASIA Business Support Group WIN Mass corporations Small /Offices Business Center Corporate Finance Support Office

SolutionSolution BusinessBusiness DevelopmentDevelopment BusinessBusiness PromotionPromotion UsingUsing WINWIN Bulletin Board ?Develop business to solve customer problems through a cooperation between branches and headquarters Sales Proposal Real Estate Others Business Matching Business Succession/M&A Status All Pending In action COMPL Updated Y M D Y M D Section Area Annual Business Business Creation Support Overseas Expansion Support Proposal Category

SalesSales systemsystem

Ratio of demographics to the total of MajorMajor financialfinancial productsproducts andand channelschannels personal deposits and personal asset management products in Nanto Bank ClientClient segmentsegment StrategyStrategy byby segmentsegment Headquarters

FA Housing loan Telephone 10.5% ?Strengthen response (Financial Advisory) 1,200 households centers center Financial to advanced and Offices (8 locations) (1 location) Very affluent (SP) assets diverse customer (2 locations) 19.6% Large needs through 6,000 households cooperation between headquarters and The number shows Business Promotion System WIN target households sales offices as of March 31, 2010 12,000 households 20.6% Affluent (SS) ?Increase deposits and 132 Branches 27,000 households assets on deposit by Assigned 20 specialized workers from Oct. 2009 expanding sales of consulting services that meet customer Financial products Middle 49.3% needs Privately-placed structured bonds 74,000 households Corporate bonds, Publicly-placed structured bonds

Foreign bonds, Lifetime medical/nursing-care insurance, Benefit ?Expand the retail life insurance Mass Financial customer base with Point Foreign-currency deposits, Investment trusts, Personal pension assets Circle insurance 1,572,000 households Small ?Promote retail loans for particular life stage Yen deposits/Public bonds , Direct deposits (for salaries), Pension, Credit Cards, Point Circle

The figure shows the number of target households (As of Mar. 31, 2010) （Includes households which holds financial deposits in other financial institutions)

15 Retail Banking Policies -2 (Target on Middle and Affluent Clients)

PromotionPromotion MeasuresMeasures SalesSales byby FAFA (Financial(Financial Advisory)Advisory) OfficeOffice ? Introduction of new products of investment trusts and life Sales amount (¥ billion) Commission (¥ million) 15.0 400 insurance Sales of insurance ? Target on affluent clients in cooperation with more FA Sales of FA specialists Commission 10.9 (Nov. 2008) ? Nov. 2009: Expanded to 2 FA offices and increased by 4 to 10 members Expansion of offices ? Apr. 2010: Increased by 2 to 12 staff members and commitment of human resources 6.8 264 ? Increase of specialized workers 200 Total Sales ? Oct. 2009：Allocated 10 specialized workers at sales offices 4.0 175 ? Apr. 2010：Increased 10 more specialized workers 2.7 1.2 ? Improve sales skills through seminars and training courses 77 72 ? Strengthen over-the-counter sales system of main 0 40 0 2H FY2007 1H FY2008 2H FY2008 1H FY2009 2H FY2009 branches and offices, etc.

AchievementsAchievements byby SpecializedSpecialized WorkerWorker Lobby Upgrades for Main Branches (Asset management products, etc.*) Lobby Upgrades for Main Branches ConsultingConsulting BoothBooth (Asset management products, etc.*) • Customer Consulting Booths appropriate for asset Net sales of asset management management consultations and other activities aimed at products per specialized worker Branches Net sales per teller increasing customer interest 61 is three times higher than that of in investing will be installed (all-branch average) (2H FT2009) an average teller. High Counter Low counter GeneralGeneral Reception Reception and and Passbook Passbook ATM Updating Counter Updating Counter Net sales per specialized worker • A General Reception and Passbook (2H FT2009) 165 Reception Updating Counter that is equipped (¥ million) Room with an EQ system and passbook terminal, and acts to focus customer traffic, will be installed in lobbies, 0 *Investment trust + Insurance + Public bonds 200 Reception and those in charge of lobby sales Room will work to expand earnings opportunities and improve the efficiency of teller operations. 16 Retail Banking Policies -3 (Promoting Retail Transaction as a Main Bank)

PointPoint Circle Circle Overview Overview EffortsEfforts toto ExpandExpand RetailRetail TransactionTransaction BaseBase Transaction Types Point Privileges Direct deposits (for salaries) 40 Stage 1 No usage fee for convenience store ATMs ?Promote retail transaction as a main bank through Point Automatic bill payment (5) 25 • 50 or 0.5% per annum interest benefit on auto loans, etc. Circle (point system) as a non human sales tool Total points 65 more • points ?By sending direct mails (DMs) to non-members, *Plus promote the membership program Cumulative deposit automatic •No usage or after-hours fees for convenience store ATMs 5 transfer Stage 2 •No after-hours fee for Nanto ATMs ?Implement cross-selling to encourage Point Circle Free transfers between Nanto head office and branch Housing loan 30 100 or • members to make their Nanto account their main accounts Credit card (Nanto DC, Nanto more account for salary deposits, credit card payments, etc. 20 points •50% off fee for early home loan repayment VISA, or Nanto JCB) •1.0% per annum interest benefit on auto loans, etc. Total points 120

*Plus *Plus Promote retail transaction as a main bank Stage 3 Deposit/loan balance of ¥5 million 30 150 or •No usage fee for early home loan repayment 2.0% per annum interest benefit on card loans, etc. Nanto Bank’s shareholder more • Create a mechanism to gather deposits 10 50% off fee for safe deposit box, etc. (1,000 shares and over) points • Total points 165 * For customers of Stage 2 (100 or more points) or higher with time deposit or assets on deposit of ¥10 million or more Coupon for a stay at a renowned hotel Improve the stable operational base (As of January 31 of each year) (April 2010 or later)

ChangeChange inin TransactionsTransactions amongamong NewNew 60,00060,000 PointPoint CircleCircle MembersMembers (From(From Sep.Sep. 20082008 toto Mar.Mar. 2010)2010) NumberNumber ofof PointPoint CircleCircle MembersMembers Promotion of base items Increase rate of deposit balance Jan. 2010 Increase rate among Point Circle members Increase rate among Point Circle members Dec. 2008 No. of DMs 8.0% Increase rate within Nanto Bank 6.0% Increase rate within Nanto Bank 5.7% No. of DMs sent: 160,000 6.8% 150 Number of Point Circle members 147 increased through DMs. sent: 310,000 6.1% 4.8% (Thousand 129 13 4.2% people) 10 Of which, Expansion of transaction new members: 3.0% 50 60,000 base is expected. 40 72 66 68 1.7% 1.6% 8 8 8 24 25 25 78 83 0.0% Cumulative deposits Credit card customers 0.0% customers Personal deposit balance Of which time deposits 31 35 37

0 As of As of As of As of As of Mar. 31, 2006 Mar. 31, 2007 Mar. 31, 2008 Mar. 31, 2009 Mar. 31, 2010 ?Improve the operational base through the active Point Stage 1 Stage 2 Stage 3 Circle transactions by customers. 17 Retail Banking Policies -4 (Reinforcing Personal Loans)

MeasuresMeasures forfor ReinforcingReinforcing PersonalPersonal LoansLoans NewNew HousingHousing LoansLoans ActuallyActually MadeMade

New loan Refinancing Housing starts in Nara Pref. ? Promote personal loans that balance volume and (¥ billion) (Households) 90.0 4,662 5,000 quality 4,474 • Strengthen business with high-quality tie-up partners 4,121 • Strengthen tie-ups between 8 housing loan centers 15.6 3,655 and sales offices 60.0 3,020 3,143 • Strengthen efforts to promote refinancing 4.2 8.7 • Strategically allocate staff specializing in housing loan 12.0 • Hold holiday counseling services by housing loan 10.4 30.0 63.0 8.5 centers 53.2 53.4 • Strengthen delinquency management by Housing 41.2 29.9 Loan Administration Team 27.3

• Strengthen management of lower score ranking clients 0 0 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 CompositionComposition ofof NewNew PersonalPersonal LoansLoans ActuallyActually MadeMade byby BorrowerBorrower CategoriesCategories HousingHousing LoanLoan DelinquencyDelinquency RateRate

Lower A - E F - G (Case) Housing Loan (with Nanto credit guarantees) Delinquencies (2 or more payments in arrears) (%) • Delinquency Rate *Based on number of loans 100% 3.60% 600 1.11 1.20 Establishment of Housing Loan Ｇ 19.36% Administration Team (July 2009) 0.96 Delinquency rate abates Lower score ranking 0.78 0.81 customers: -16 points 0.69 Rank

96.40% 508 80.64% 438 442 353 384 A

Higher 0 0.00 0% 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 18 Retail Banking Policies -5 (Channel Strategy) OfficeOffice ReorganizationReorganization ofof GojoGojo regionregion

Kyoto 1) To fulfill the duties and responsibilities as a regional financial institution and deliver a certain level of financial services even to areas where no increase in population for Osaka households can be expected. 2) To secure business shares and maintain stable procurement in the region by continuing to keep staffed locations. Gojo city 3) To lower costs and improve profitability of service outlets even in limited markets. Two villages merged Former Wakayama Nishiyoshino into Gojo city in Sept. village 25, 2005 Former Daito village

Before Utilize Agency System Before Utilize Agency System Nara City Nanto Bank Nanto Bank Nanto Bank’s agencies

Nanto Bank Nanto Bank Nanto Bank • Looking ahead, the use of Nanto Bank Nanto Bank satellite operations will be considered regarding Nanto Bank sales offices in areas where no increase in Nanto Bank Nanto Bank population for households can be expected.

＜Total workers of 4 agencies＞ Workers Workers Savings of approx. Nanto Bank Employees 48 Nanto Bank Employees 38 annual ¥50 million Agencies’workers 6 Part-time workers 15 Part-time workers 14 per location Total 63 Total 58

19 Appendix

Profile of the Nanto Bank Appendix-1 Progress in Implementing the Medium-Term Management Plan Appendix-2 Industrial Production Index / Business Projection for Local Companies Appendix-3 Business Bankruptcy and Employment Conditions Appendix-4 Number of Population, Households, and Housing Starts in Nara Prefecture Appendix-5 Sales of Investment Trusts and Life Insurance Appendix-6 Various Interest Rates Appendix-7 Smooth Financing for SMEs Appendix-8 Ratio of Loans by Industry Appendix-9 Shift in Classification of Debtors Appendix-10 Promoting CSR Appendix-11 PR for the 1300th Anniversary of Nara Heijo-kyo Capital Appendix-12 Efforts to Improve CS Appendix-13 Profile of the Nanto Bank

1. Founded June 1, 1934 (As of the end of March 2010) 2. Location of head office 16, Hashimoto-cho, Nara City 3. Capital ¥29,249 million 4. Number of employees 2,722 5. Number of offices 132 (Japan), 2 (representative offices in Hong Kong and Shanghai) 6. Total assets ¥4,557.9 billion 7. Deposits outstanding ¥4,046.4 billion 8. Outstanding loans ¥2,742.5 billion 9. Capital ratio Non-consolidated: 11.88% Consolidated: 12.12% (Head Office) 10. Deposit and loan market share in Nara Prefecture

4.1% in Nara Pref.> PB PB 4.1% 7.1% Shinkin Shinkin 13.5% 16.1% Nanto Bank Nanto Bank 47.9% 49.4% City Bank City Bank 29.7% 27.6%

Appendix-1 Progress in Implementing the Medium-Term Management Plan

Medium-Term Management Plan More Value ?“Nanto” • Strive to expand the business foundation and improve risk management with the goal of further increasing corporate value April 2008 ? March 2011

Basic Policies (summary) 1. Strengthen profitability and improve risk management Priority Strategies 2. Invigorate employees and the organization 3. Invigorate local economies 4. Promote CSR I. Strengthen the II. Enhance and sales capabilities upgrade internal Numerical Targets More Value – “NANTO” of regions and control systems FY 2008 FY 2009 FY 2010 divisions FY2007 Compared Compared Compared Item (Results) (Results) with mid- (Results) with mid- (Projection) with mid- term MP term MP term MP ¥19.3 bn ¥16.1 bn -¥1.3 bn ¥16.4 bn -¥5.2 bn ¥16.7 bn -¥9.3 bn 1. Core net business profit III. Strengthen human resource 2. Net income ¥5.0 bn -¥22.3 bn -¥29.5 bn ¥7.3 bn -¥2.1 bn ¥6.0 bn -¥5.9 bn management 3. Outstanding loans ¥2.69 tn ¥2.86 tn ¥0.07 tn ¥2.74 tn -¥0.15 tn ¥2.80 tn -¥0.19 tn

Management indicators

Profitability 1. ROE 2.70% - - 4.62% +0.001% 3.31% -2.09%

Efficiency 2. OHR 70.83% 75.67% 1.22% 74.97% 5.03% 75.45% 9.20% IV. Promote CSR 3. Capital ratio 10.53% 9.82% -0.93% 11.88% 1.18% 11.21% 0.54% Soundness 4. Bad debt ratio 3.86% 3.32% -0.32% 3.12% 0.07% 3.01% 0.29% Interest rate scenario (%) FY2009 FY2010 As of Sep. 2009 As of Mar. 31, 2010 As of Sep. 30, 2010 As of Mar. 31, 2011 Compared with Compared with Compared with Compared with (Results) Mid-term MP (Results) Mid-term MP (Estimate) Mid-term MP (Estimate) Mid-term MP All measures Overnight unsecured call rate 0.10 -0.65 0.10 -0.65 0.10 -0.90 0.10 -0.90 Japan Short-term prime 2.175 -0.200 2.175 -0.450 2.175 -0.450 2.175 -0.700 3-month TIBOR 0.54 -0.46 0.50 -0.60 0.50 -0.80 0.50 -0.90 5-year JGB 0.59 -0.81 0.60 -0.90 0.60 -1.10 0.70 -1.10 3-month LIBOR 0.29 -2.91 0.30 -3.20 0.70 -3.00 1.20 -2.80 U.S. US 5-year bond 2.31 -1.09 2.50 -1.20 2.70 -1.30 3.10 -1.10 3-month LIBOR 0.71 -3.59 0.70 -3.60 1.00 -3.30 1.30 -3.00 EU German 5-year bond 2.40 -2.00 2.30 -2.10 2.50 -2.00 2.70 -1.80 Appendix-2 Industrial Production Index / Business Projection for Local Companies

IndustrialIndustrial ProductionProduction IndexIndex BusinessBusiness projectionprojection forfor locallocal companiescompanies

140.0 60.0 Improve Downturn DI (Year 2005 =100) (DI) Production index - National Inventory index - National Production index - Nara Pref. Inventory index - Nara Pref. Production index -Kinki Region Inventory index - Kinki Region 119.9 32.5 26.3 22.8 17.9 13.9 103.7

5.0 103.5 95.5 0.0 94.1 2006 2007 2008 2009 2010 91.9 -7.5 (Projection) 91.3 89.0 77.8 -17.7 -28.5 -27.5 69.7 76.6 -33.8 -41.8 -40.5 69.5 -46.4 60.0 2009 2010 Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. -60.0 -55.7

[Source: Ministry of Economy, Trade and Industry, Kansai Bureau of Economy, Trade and Industry] [Source: Nanto Economic Research Institute]

Appendix-3 Business Bankruptcy and Employment Conditions

NumberNumber ofof BankruptciesBankruptcies inin NaraNara Pref.Pref. EffectiveEffective RatioRatio ofof JobJob OffersOffers toto ApplicantsApplicants

(¥ billion) (Cases) (Times) Total debts 100.0 200 Number of bankruptcies 0.6

134 133 133 0.560.56 73 66.0 National average Nara Pref. 46 Kinki region 43.8 0.530.53 23.5 25.8 22.3 0 0 0.50 2005 2006 2007 2008 2009 0.520.52 0.50

0.490.49 NumberNumber ofof BankruptciesBankruptcies inin OsakaOsaka Pref.Pref. 0.480.48 (¥ billion) Total debts 1,951 (Cases) 1,500 Number of bankruptcies 1,814 2,000 1,700 1,222.0 1,228 854.4 989 632.9 483.4 0.4 413.0 Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. 2009 2010

0 0 [Source: Health, Labor and Welfare Ministry ] 2005 2006 2007 2008 2009

[Source: TEIKOKU DATABANK]

Appendix-4 Number of Population, Households, and Housing Starts in Nara Prefecture

?As of Mar. 2010, population and the number of households in Nara prefecture was 1.39 million and 560,000 households, respectively. Due to ?The number of housing starts for Nara Prefecture during FY2009 was the trend toward nuclear families, the number of households has been on 6,163, declined from FY2008. a increasing trend.

The number of Housing Starts in Nara Pref. Housing starts Nara Prefecture: Population and Households Y/Y growth rate 1,500 600 6,000 +0.0 (Unit) (%) (Thousand -4.0 -11.3 (Thousand Population Households -14.0 of people) households) 562 -32.5

4,474 3,655 3,020 3,143

0 -60.0 1,398 1H FY08 2H FY08 1H FY09 2H FY09

The number of Housing Starts in Osaka Pref. Housing starts 50,000 +6.8 Y/Y growth rate +10.0 (%) (Unit) （%） -11.1

-18.7 26,408 39,020 25,631

32,477 -34.3 1,300 400 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 0 -50.0 1H FY08 2H FY08 1H FY09 2H FY09

Appendix-5 Sales of Investment Trusts and Life Insurance

ChangesChanges inin TotalTotal SalesSales ofof InvestmentInvestment TrustsTrusts andand RelatedRelated CommissiCommissionsons Sales (¥ billion) Commission (¥ billion) 50.0 1.60 1.51 Commissions [1.31] 43.8 (sales charges + trust fees) [1.18]

0.98 0.91 [35.0] 0.90 [30.0] Sales of investment trusts 0.54 0.66 16.6 14.3 11.6 5.7 8.3 0 0.00 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 1H FY10 2H FY10 （(Estimate)計画） （(Estimate)計画）

ChangesChanges inin TotalTotal SalesSales ofof LifeLife InsurancesInsurances andand RelatedRelated CommissionCommissionss Sales (¥ billion) Commission (¥ billion) 40.0 1.50 1.33 Commissions 0.97 0.99 [0.93] [0.93] 0.99 0.76 0.37 30.1 [30.0] [30.0] 23.0 25.6 21.2 18.6

Sales of life insurance 8.2 0 0.0 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 1H FY10 2H FY10 (Estimate)（計画） （Estimate)計画） Appendix-6 Various Interest Rates

InterestInterest onon DepositDeposit andand LoanLoan YieldYield onon SecuritiesSecurities

2.50 Interest on loans Interest on deposits 4.00 Yield on securities Domestic Foreign （%） Interest margin between deposits and loans （%） 2.01 1.99 3.59 1.85 1.75 1.80 3.23 3.15

1.71 1.73 1.72 2.77 1.68 1.65 2.06 1.89 1.85 1.66 1.43 1.12 1.21 1.07 1.10 1.09 1.07 0.28 0.27 0.20 0.12 0.04 0.00 0.00 FY2005 FY2006 FY2007 FY2008 FY2009 FY2005 FY2006 FY2007 FY2008 FY2009

(%: half-year basis) 1H FY05 2H FY05 1H FY06 2H FY06 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 Interest on loans 1.76 1.73 1.75 1.86 1.98 2.03 2.01 1.97 1.87 1.82 Interest on deposits 0.04 0.04 0.07 0.18 0.27 0.28 0.30 0.24 0.21 0.18 Interest margin between deposits and loans 1.72 1.69 1.68 1.68 1.71 1.75 1.71 1.73 1.66 1.64

(%: half-year basis) 1H FY05 2H FY05 1H FY06 2H FY06 1H FY07 2H FY07 1H FY08 2H FY08 1H FY09 2H FY09 Yield on securities 1.62 2.13 2.08 2.05 1.76 1.56 1.49 1.35 1.24 1.18 Domestic 0.94 1.19 1.09 1.15 1.11 1.09 1.09 1.10 1.09 1.05 Foreign 2.88 3.48 3.55 3.64 3.34 2.92 2.95 2.55 1.93 1.76 Appendix-7 Smooth Financing for Small and Medium Enterprises (SMEs)

? Based on the idea that our mission is to smoothly respond to local financing needs and fully live up to the role of a financial intermediary, it has long been our practice to flexibly respond to payment extension and other requests based on the circumstances of individual clients. ? With the implementation of the Act on Facilitating Financing for SMEs, we will take steps to make it easier for clients to seek financing advice.

BankBank OperationsOperations FlowFlow ChartChart

Nanto Bank Clients Basic Policy on Facilitating Financing

Board of Directors, etc. Board of Corporate Board of Directors Disclose and report Auditors Branch Marketing Managing Directors’ Committee according to the Act on Seek advice, Submit application for new loan, Division Director in Charge of Financing Facilitation Facilitating Financing for SMEs Modify loan terms Management

Instruction on financing facilitation Financing management method, etc. SMEs, etc. Facilitation Instruct Reports on financing facilitation status Manager Smoothly provide necessary funds, (Marketing Div. Modify loan terms, Give adequate and full Manager, Branch Headquarters Manager) explanatory consulting service Support Credit Guarantee Association Credit Analysis Division Operations Control Division Financing Facilitation Management Division Staff in Charge of Financing Facilitation Management Chief Financing Facilitation Management Deputy Japan Finance Corporation Financing Administrator (Credit Division Manager) Administrator (Operations Control Division Manager) Report Control of management system for Facilitation Financing Facilitation Promotion Team customer protection, etc. Enterprise Turnaround (Marketing Div. Leader Credit Analysis Division Manager Compliance Management Group Initiative Corporation of Japan and Branch Sub-Leader Credit Analysis Division Deputy Manager Cooperate employees) Consult Staff in charge of SMEs Improve customer support Staff management system Staff in charge of housing loan customers Complaint and advice hotline Japan Housing Finance Duties Monitor advice and applications Toll-free phone service Support sales offices Agency Lodge complaint Toll-free phone service ? Other financial institutions Seek advice ? etc. Corporate Finance Support Office Give management advice and guidance Seek advice, Support business improvement and improvement Housing loan Submit application for new loan, planning customers, etc. Modify loan terms Housing loan Information Sharing and Cooperation Osaka Regional HQs Operations Division General Planning Division Nanto Credit center Personnel Division Review applications for Improve systems for Improve personnel Evaluate business Guarantee Co., Ltd. Smoothly provide necessary funds, new loans and loan providing information to evaluation system performance and Cooperate Modify loan terms, Daily Living modifications customers improve systems Nanto Lease Co., Ltd. Give adequate and full explanatory advice Advice Center etc. Internal Audit Internal Audit Internal Audit Division Conduct internal audits

Appendix-8 Ratio of Loans by Industry

LoansLoans OutstandingOutstanding byby IndustryIndustry RatioRatio ofof LoansLoans byby IndustryIndustry

End of Sep. End of Mar. Change from End of Sep. End of Mar. Change from (¥ billion) (%) 2009 2010 end of Sep. 2009 2010 end of Sep. 2009 2009 Total lending volume 2,778.3 2,742.5 -35.7 Total lending volume 100.00 100.00 Manufacturing 492.6 477.7 -14.9 Manufacturing 17.73 17.42 -0.31 Agriculture and forestry 5.2 4.9 -0.3 Agriculture and forestry 0.19 0.18 -0.01 Fishery 3.0 2.8 -0.1 Fishery 0.11 0.10 -0.01 Mining, stone and gravel quarrying 6.4 6.3 -0.0 Mining, stone and gravel quarrying 0.23 0.23 -0.00 Construction 114.6 108.4 -6.1 Construction 4.13 3.96 -0.17 Electric, gas, heat supply and water utility 9.7 9.8 0.0 Electric, gas, heat supply and water utility 0.35 0.36 0.01 Information communication 19.4 15.3 -4.0 Information communication 0.70 0.56 -0.14 Transportation and postal service 78.9 81.8 2.9 Transportation and postal service 2.84 2.98 0.14 Wholesaling and retailing 294.0 281.7 -12.2 Wholesaling and retailing 10.58 10.27 -0.31 Finance and insurance 132.9 118.3 -14.6 Finance and insurance 4.79 4.31 -0.47 Real estate and leasing 313.7 299.4 -14.3 Real estate and leasing 11.29 10.92 -0.37 Services 159.2 158.8 -0.4 Services 5.73 5.79 0.06 Local public entity 327.8 363.4 35.6 Local public entity 11.80 13.25 1.45 Others 820.1 813.2 -6.9 Others 29.52 29.65 0.13

Appendix-9 Shift in Classification of Debtors

? Total credit (loans): ¥2,768.8 billion (decrease of ¥129.8 billion from Mar. 2009) ? Loans to normal debtors: ¥2,462.1 billion (decrease of ¥146.9 billion from Mar. 2009) ? Loans to debtors requiring caution and Substandard debtors: ¥239.1 billion (increase of ¥19.8 billion from Mar. 2009) ? Loans to potentially bankrupt debtors and lower:¥67.6 billion (decrease of ¥2.7 billion from Mar. 2009)

(¥billion) As of March 31, 2010 Balance Bankrupt and (Subject: Credit related (As of March 31, 2009) Potentially Assets requiring Substandard effectively For collection claimable assets Normal assets bankrupt such as loans) caution assets bankrupt or write-offs assets assets a b c d e F g

1 Normal debtors 2,609.0 2,349.9 64.2 7.0 7.3 2.8 177.5

2 Debtors requiring caution 183.2 14.0 131.3 1.7 9.6 0.7 25.6

3 Substandard debtors 36.0 0.4 10.5 16.3 3.8 1.0 3.8

4 Potentially bankrupt debtors 60.7 0.0 6.5 0.8 32.6 6.2 14.3

Bankrupt and effectively 9.5 0.0 0.1 0.0 0.6 2.5 6.2 5 bankrupt debtors

6 New debtors 0.0 97.5 0.2 0.0 0.0 0.0 0.0

7 Total 2,898.6 2,462.1 213.2 25.9 54.0 13.5 227.7

Loans to normal debtors: Loans to debtors requiring caution Loans to potentially bankrupt Loans to potentially bankrupt Decrease of ¥146.9 billion and Substandard debtors debtors or below debtors or below from March 2009 Increase of ¥19.8 billion Decrease of ¥2.7 billion For collection or write-offs from March 2009 from March 2009 ¥20.5 billion

Appendix-10 Promoting CSR

Promote CSR (Corporate Social Responsibility)

?Promote environmental preservation activities ?Promote social contribution activities

?Organize CSR ?Expand disclosure of CSR information

EnvironmentalEnvironmental PreservationPreservation ActivitiesActivities

・Conduct a “Cool Biz (casual day)” campaign at all offices Overview of Yoshino Heart Project ・Digitalize internal documents Overview of Yoshino Heart Project ・Grow trees and cut grass in Asuka-village ・Support the “Yoshino Heart Project” Aware of the importance of incl. PR campaign at convenience CSR + PR participating in forest preservation stores in Tokyo metropolitan area image strategy and CO2 reduction activities for the 1300th Anniversary of Nara Heijo-kyo Capital, and making use of Participate in Sponsoring and products made from waste Yoshino Sponsoring and Use Consumers product design, participating companies Consumers Japanese cedar and cypress lumber PR programs and participating companies ・Establish a recycling center to recycle tree-planting Companies in Yoshino Seek marketing waste paper activities Sponsor product planning Sento-kun ad Purchase area widely corporate sponsors chopsticks Designers, SocialSocial ContributionContribution ActivitiesActivities Designers, Project musicians,musicians, Create Participate Portal function in Yoshino area HeartHeart Tree Tree Project Project professionalprofessional demand ・Actively support the 1300th Anniversary of the Nara athletes,athletes, etc. etc. Heijo-kyo Capital (from Jan. 2010) ・Dispatch Nanto Bank retirees to work for the special public Commerce and Commerce and industry societies, NPO showing of Nara Yamatoji treasures and the Hibutsu industry societies, NPO Foresters various associations, Foresters various associations, Yoshino Heart (Hidden Buddha) etc. Yoshino Heart ・Work with the Yoshino Cherry Tree Preservation Group etc. Revitalize ・Spread monetary economy education in local communities Contribute a portion of the whole area Corporate and Back up Lumber-related profits to tree-planting Lumber-related collaborate and thinning activities and support businessesbusinesses

Nara Prefecture and other NANTO BANK Public-private Nara Prefecture and other sectors cooperate locallocal government government entities entities

Monetary economy class at local elementary school Appendix-11 PR for the 1300th Anniversary of Nara Heijo-kyo Capital

?Period: January 1, 2010 to December 31, 2010 (Heijo Palace Site: April 24 to November 7) ?Locations: Heijo Palace Site and other locations in Nara Prefecture and Nanto Bank TV CMs the other Kansai area ?Projects: 1) Heijo Palace Site projects 2) Projects within Nara Prefecture 3) Related wide-area projects 4) Lead-up projects ?Project Scale Expected attendance: Total: Approx. 12 to 13 million Heijo Palace Site: Approx. 2.5 million Total budget: Approx. ¥10.0 billion

2010 Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.

Flower and Greenery Fair Light and Candle Fair Heijo-kyo Fair Heijo Palace Spring Summer Fall Site projects

Throughout the year : From April 24 to November 7, 2010

Projects within Opening Various locations in Nara Prefecture and around Heijo Palace January 1 to December 31 Nara Pref. Public Showing of Winter Opening Spring Opening Fall Opening Treasures of Shrines and Temples and the Hibutsu Ikaruga and Shigisan Areas Asuka and Fujiwara Areas Yoshino Area (Hidden Buddha) Katsuragi Area Yamato Kogen Plains and Uda Areas Local and wide- area events Greening Fair Walking, Marathon, and Cycling Events History and art museums Special Exhibitions

Related wide- Convention and Forum area events Joint events with other localities in Japan and abroad

Appendix-12 Efforts to Improve CS

? Return to the origin of the service industry, strengthen efforts to improve customer satisfaction, and implement measures to improve CS, centered on the CS Improvement Committee and the CS Improvement Working Group

CSCS ImprovementImprovement ApproachApproach

NantoNanto CSCS ImprovementImprovement Customer CommitteeCommittee proposal Customer Provide quality opinions products, (complaints, Improve services, etc. requests, Report Propose/ Headquarters/ Advise Customers needs, etc.) sales offices Customers Customer Collect/ Analyze survey CS Improvement CS Improvement Implement WorkingWorking GroupGroup measures Environmental and system --ConsiderConsider concreteconcrete measures for CS Instruct changes, etc. Analyze measures for CS improvementimprovement Teach

CSCS DeclarationDeclaration AllAll--officeoffice SmileSmile CampaignCampaign CSCS TrainingTraining

• We will greet customers with a smile • With the CS Declaration, an “All-office • Based on items such as requests from and strive to provide customers with Smile Campaign” is held in which customers, staff receive thorough thoughtful service. employees working at counters and training to deepen their understanding • We will endeavor to provide better visiting customers provide service with of the significance and importance of products and services that satisfy a smile, the foundation of the service CS and about what their role should be customers. industry. (from October 1 through in improving CS. • We will work to provide accurate and December 30, 2009) quick responses and easy-to- understand, precise explanations. Appendix-13 In this material, we refer to the future performance of the bank. However, these descriptions do not guarantee the performance mentioned in the material and include risks and uncertainties. Please be aware that the future performance mentioned in this material may change from the targets as a result of, for example, changes in the operating environment.

[Inquiries:] The NANTO BANK, LTD. General Planning Division IR Group TEL: 0742-27-1552 FAX: 0742-20-3614 E-mail: [email protected] URL: http://www.nantobank.co.jp/

B-(3)-080031

As one of Nanto Bank ’s environmental efforts, we support “Yoshino Heart Project” and “Kizukai Activities.”