The Norinchukin Bank VALUE REPORT 2020 VALUE REPORT 2020
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The Norinchukin Bank VALUE REPORT 2020 VALUE REPORT 2020 2 3 Our work at The Norinchukin Bank won’t change the world overnight. Our focus is on the agriculture, fishery and forestry industries. This means that nature is our partner, and nothing in nature bears fruit overnight. Industries in this sector don’t make things —they produce and nurture life as a legacy for future generations. This is precisely why we are dedicated to serving those who sustain these industries and their local communities, no matter how small the scale of their operations. As the financial institution wholly devoted to this sector —the very cornerstone of our nation, we strive consistently to generate solid outcomes in the global financial markets. Our history spans more than 90 years. But that alone is no longer enough. We must take on a greater role than ever before if this sector is to continue developing in response to the changing times. We must harness our financial knowledge to make new contributions that extend beyond our past functions and scope. We must do our utmost to address on-the-ground issues. We must respond to the needs not only of producers, but also to those of processors, distributors and consumers. The life generated by the agriculture, fishery and forestry industries sprouts the workings of all life well into the future. Now is the time for each and every one of us to give our all. We aim to make the chain of life that connects us to the future more bounteous and more certain. 4 VALUE REPORT 2020 5 Contents PART 1 Goals of The Norinchukin Bank 6 The Norinchukin Bank’s Value Creation Model 8 Our Features 10 Medium-Term Management Plan 12 Digital Innovation and Sustainability Management 14 PART 2 Three Value-Creating Businesses 16 Food & Agriculture Business 18 Retail Business 26 Investment Business 30 Corporate Data 35 4 VALUE REPORT 2020 5 PART 1 Goals of The Norinchukin Bank 6 VALUE REPORT 2020 7 6 VALUE REPORT 2020 7 The Norinchukin Bank’s Value Creation Model Resources and Strengths The Norinchukin Bank’s Business Abundant food and agriculture knowledge 97 years and leading-edge financial knowledge History of supporting the agriculture, fishery The Norinchukin Bank and forestry industries through finance Business Model 18 years Integrated management of JA Bank composed of 585 JAs and 32 JA Shinnorens Agriculture Agriculture Investment Investment Business Business Business years Food & 22 Retail Got into globally diversified investments ahead of the times forestry industries into growth networks to turn the agriculture, fishery and business community and expands their Supports and connects producers the while achieving efficient management diverse financial needs in each region JA Bank and JF Marine meet management investments based on advanced risk to long term through globally diversified Ensures stable profit over the medium 3,477 groups Members of The Norinchukin Bank Stable deposits and financial base trillion yen Network of cooperatives 104.1 JA Bank savings balance Cooperative INPUT system 2.6 trillion yen JF Marine Bank savings balance A (S&P) A1 (Moody’s) Credit rating 23.02 % Total capital ratio Corporate & Shared Services Supports the three business areas and promotes new initiatives such as digital innovation and sustainability management 28.8 billion yen Expert human resources Total assets per employee (non-consolidated basis) 3,588 people Number of employees Our Mission Supporting the Contributing to Facilitating funding advancement of for cooperative the agriculture, fishery the development of 119 people organizations the nation’s economy Number of employees and forestry industries who have studied overseas (= number of employees Our Vision who have obtained MBA/LLM) Leading bank that supports the agriculture, fishery and forestry industries, food production and consumption, and the daily lives of local communities 8 VALUE REPORT 2020 9 The Norinchukin Bank’s Value Creation Model Value Provided Business Achievements to Society Turning the agriculture, fishery and forestry industries Turning communities Revitalize local income Increase producers’ Seed money Support industries* for the AFF As the main bank Agricultural Consulting for leaders corporations AgTech investment Value provided to local communities, inhabitants and national land through collaboration with the cooperative system Value Turning the into growth industries agriculture, fishery and Enhance corporate value agriculture value chain Offer food and forestry OUTPUT Cooperation with regions Connect and firms industries into of Japan agricultural bank As the food and Japanese Procurement/development food and sustainable of sales channels agriculture growth companies industries Support for overseas expansion Providing return of profit and financial functions business transactions Leading Asian food and agriculture food Bridge to the world based on Stable supply fishery and forestry industries Business achievements related to the agriculture, of safe and Global investment network Expand secure food institution financial As a global Global Operation of food and food and agricultural fund agriculture companies Connecting Japanese companies Revitalizing *AFF industries = Agriculture, Fishery and Forestry industries the infrastructure Agriculture-related loans (JA Bank overall) in rural areas Providing financial services right across the country Total 2.5 trillion yen JA JA Shinnoren The Norinchukin Bank 1.2 trillion yen 0.8 trillion yen 0.5 trillion yen Preserving local diversity No.2 in Japan No.3in Japan 92 vehicles Total number of JA Bank JA Bank share of The number of mobile branches in Japan individual deposits branches introduced Protecting the land Generating and marine profits environment Approx. 400.0 billion yen Returns to members profits earned from the Investment Business and the Food & Agriculture Business Developing the economy through the agriculture, fishery and Our Value forestry Dedicated to sustaining all life. Our Foundation One for all, all for one. 8 VALUE REPORT 2020 9 The Norinchukin Bank's HISTORY Our Features Constant Mission over 97 Years: Transforming Itself to Meet the Needs of the Times 1923- 1970- Meeting the demand for funding in the In light of the increase in JA agriculture, fishery and forestry Savings due to economic growth industries before and after World War II Launched as the central bank for Japan’s industrial cooperatives Extending loans and investments into wider financial markets Supporting producers with in addition to the agriculture, financial services, including loans, fishery and forestry industries in through cooperative organizations with response to the needs of the times the spirit of helping one another Producers involved in the agriculture, fishery and forestry Since the 1970s, when savings deposited by individual industries faced a shortage of funds before and after World members and local users increased considerably, we have War II until Japan’s era of high economic growth. Aiming been meeting Japan’s strong demand for funds through to solve such a situation, The Norinchukin Bank was estab- loans and investments for companies related to the agricul- lished in 1923. As the central body for agricultural, fishery ture, fishery and forestry industries, the supply of funds to and forestry cooperative organizations, The Norinchukin Japan’s short-term capital markets, and investment in Jap- Bank has supplied funds to agricultural, fishery and forestry anese government bonds. Moreover, from the latter half of cooperatives throughout Japan to provide loans to produc- the 1990s, we quickly moved into top gear on globally di- ers and met the demand for large-scale funding beyond the versified investments in global financial markets. We have capacity of individual cooperatives. The basis of these ac- returned stable earnings to members as JA, JF and JForest tions stems from our spirit of helping one another— “one even in a low interest rate environment. for all, all for one.” 10 VALUE REPORT 2020 11 Since its establishment in 1923, The Norinchukin Bank has been managed under special legislation, ini- tially, as the central bank for Japan’s industrial cooperatives, “Sangyo Kumiai,” and subsequently via the Norinchukin Bank Act. It is a cooperative private financial institution with a clear mission to “contribute to the development of the nation’s economy by supporting the advancement of Japan’s agriculture, fishery and forestry indus- tries by providing financial services for the members of the agricultural, fishery and forestry cooperative system.” Since its establishment, we have continued to provide support for everyone engaged in the agriculture, fishery and forestry industries for 97 years while constantly transforming in line with changes in the envi- ronment surrounding the agriculture, fishery and forestry industries. 2016 - 2019 - A bridge between the agriculture, fishery and Medium-Term Management Plan forestry industries and the business community Consumers’ and business communities’ needs The Norinchukin Bank Catch the Winds of Change. Create New Value. Supply of agriculture, fishery and forestry products that meet the needs Trying Now! Amid the ongoing significant changes in the nation’s needs The agriculture, fishery and forestry industries are not the for the agriculture, fishery and forestry industries, we be- only ones having to adapt to radical changes. The financial lieve that the delivery of safe and secure domestic produce, industry also faces rapid changes in the investment envi- which