Shinsei IR Day UDC Finance

February 2021

Shinsei , Limited Group Overseas Business Division Executive Summary

• Stability of New Zealand market ⁃ Population increase due to immigration, high GDP growth among developed countries • Significant presence in non-bank market ⁃ Non-bank sustain higher growth in loan assets compared to Banking Significant ⁃ UDC is the No.1 non-bank in New Zealand. Strong name recognition, diversified Investment industry of customers, matches Shinsei Bank focus on small-scale finance

• Key channels are Dealer and Commercial ⁃ Dealer channel mainly provide consumer / corporate motor vehicle loans Business ⁃ Commercial channel support purchasing of corporate vehicles, etc. • Funding leverages mainly securitization and parent loan, ANZ facility

New • Release AFV(Assured Future Value) product, expand used car market, customer experience improvement through focus on speed Opportunity

Shinsei • Targeting Asia Pacific Oceania region which are expected to have steady economic growth Overseas • Purchase a platform company then expand by gradual purchase / acquisition strategy • Small-scale finance which leverages Shinsei Bank know-how

1 Immigration drives growth, still area to grow

New Zealand

Population 5.10 MM 125.71 MM - 2010 Dec：4.37 MM - 2010 Oct：128.06 MM

Land Area 265,554k㎡ 377,976k㎡ - 70% of Japan Population Density 19.2/k㎡ 332.6/k㎡ Source: https://www.stats.govt.nz/ https://www.stat.go.jp/

2 Attractive GDP per capita growth rate in NZ

New Zealand Japan

GDP 23.1 tn. 552.9 tn. - 2020 Sep - 2020 Mar

GDP per capita 4.53 MM 4.40 MM

GDP growth rate 2.6% 1.1% -10 year avg. -10 year avg. Source: https://www.stats.govt.nz/ https://www.stat.go.jp/

3 Significant recovery of economy during COVID

GDP growth rate* (*2020/6-9 are quarterly based) 15.0% 14.0% NZ JP 10.0% 5.3%

5.0%

0.0%

-5.0% 2010/3 2011/3 2012/3 2013/3 2014/3 2015/3 2016/3 2017/3 2018/3 2019/3 2020/3

-10.0% -8.3% -15.0%

Source: https://www.stats.govt.nz/ -11.0% https://www.esri.cao.go.jp/jp/sna/menu.html

4 Non-bank sustain higher growth in loan asset

Loan asset growth rate of Bank and Non-bank

Bank Non bank 9.1% 8.2% 7.4% 6.5% 5.4% 5.3%

2017 2018 2019

Source: RBNZ, year ended 30 Jun

5 UDC is the No.1 non-bank in New Zealand

(M NZD) Non bank ranking(Loan asset Top10) 3,350

1,692

1,218 1,073 906 791 688 680 676 555

Source: KPMG “Non-bank Financial Institutions Performance Survey-Review of2020”

6 Strengths of UDC-1

1 Loan asset •Overwhelmingly No.1 in NZ

2 High brand recognition •Over 80 years of business history

7 Strengths of UDC-2

3 Portfolio diversified by industry, covers the entire NZ Customer industry Region Rest of South Island Others 16% Aviation 13% Personal 3% Auckland Vehicle loans 27% 29% Forestry Canterbury 8% 13%

Agriculture 9%

Construction Retail and 14% Wholesale Rest of North Island Transport & 12% 44% Storage 12%

8 Sales portfolio and channels

• UDC provides credit to domestic retail customers and wholesale customers. • UDC’s business comprises of two key channels as follows: Channel breakdown

Commercial Dealer 45% 55% 3,350M NZD / 248.7B JPY* (*1NZD=74.24JPY)

9 Dealer Channel

Finance for consumer and wholesale customers. Loan by assets Equipment / Wholesale MV Dealer 2% • Ford • Equipment / Retail 13% • • New Holland

Motor Vehicle • Hyundai • Renault / Wholesale 10% • • SSangYong • LDV •

Motor Vehicle / Retail Equipment Dealer 75% • Case •

10 Commercial Channel

Support purchase of corporate car, equipment, etc.

Industry Region Other Auckland Rest of South Manufacturing 10% 10% Island 2% Road Transport 26% 24% Aviation 6%

Agriculture 9%

Property & Business Forestry Services 20% 10% Canterbury Rest of North 17% Island 47% Construction 19%

11 Business performance is driven by several performance metrics

Increase Balance Sheet sales of new New business writing Loan asset at period start loans New business writing Increase size of total loan Loan asset Payment from loans assets Loan asset at period end

Increase Net interest margin revenue

Income Statement Controlling Net interest income process Expense ratio (Net Interest Margin) Operating expenses (Expense ratio) Decrease Credit cost credit cost Credit cost Net income

Business Net income Result

12 Key indicators-1

New business writing Loan asset (M NZD) (M NZD) 3,484 3,285 3,350

2,962

1,789 1,830 1,694 1,598

2017/9 2018/9 2019/9 2020/9 2017/9 2018/9 2019/9 2020/9

13 Key indicators-2

Net interest margin Expense ratio

29.8%

27.4% 26.7% 25.3%

4.4% 4.3% 4.4% 4.4%

2017/9 2018/9 2019/9 2020/9 2017/9 2018/9 2019/9 2020/9

14 Key indicators-3

Credit cost Net income

(M NZD) (M NZD)

71.4

63.5 62.4 58.4

26.0

10.9 13.2 5.9

2017/9 2018/9 2019/9 2020/9 2017/9 2018/9 2019/9 2020/9

15 Stable Funding

Funding

1 Securitization (M NZD)

1,991 2 Parent company loan

3 ANZ facility 900 100

Amout

16 New opportunity after Shinsei purchase 1 Assured Future Value product* *Loan that deducts the residual value after using the car for a certain period from the vehicle price and pays rest in installments. - Loan asset of 150M NZD in next 5 years Target 6.8M NZD Income per year 2 Expand to used car market 3 Focus on speed - Expand scope of auto assessment - Simplify Customer App Form submission - Release Smartphone ID authentication

17 Shinsei’s Oversea Strategy in the future

1 Asia Pacific, Oceania 2 Platform Company 3 Small-scale finance

18 Disclaimer

 The preceding description of Shinsei Bank Group’s Medium-Term Strategies contains forward-looking statements regarding the intent, belief and current expectations of our management with respect to our financial condition and future results of operations. These statements reflect our current views with respect to future events that are subject to risks, uncertainties and assumptions. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results may vary materially from those we currently anticipate. Potential risks include those described in our annual securities report filed with the Kanto Local Finance Bureau, and you are cautioned not to place undue reliance on forward-looking statements.

 Unless otherwise noted, the financial data contained in these materials are presented under Japanese GAAP. Shinsei Bank Group disclaims any obligation to update or to announce any revision to forward- looking statements to reflect future events or developments. Unless otherwise specified, all the financials are shown on a consolidated basis.

 Information concerning financial institutions and their subsidiaries other than Shinsei Bank Group are based on publicly available information.

 These materials do not constitute an invitation or solicitation of an offer to subscribe for or purchase any securities and neither this document nor anything contained herein shall form the basis for any contract or commitment whatsoever.

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