We, the 64 regional banks in Japan, have for a long time enjoyed the patronage of the people of our regions as banks that move
in step with the community. Hokkaido The Hokkaido Bank The regional banks as financial institutions that have the trust of their customers, will continue to contribute to the activation of regional societies through meeting various financial needs in the regions, by enhancing financial functions such as relationship- based banking. Aomori The Aomori Bank THE MICHINOKU BANK
Akita Iwate THE AKITA BANK The Bank of Iwate The Hokuto Bank THE TOHOKU BANK
Yamagata THE SHONAI BANK The Yamagata Bank Miyagi The 77 Bank
Niigata The Daishi Bank Fukushima The Hokuetsu Bank The Toho Bank Ishikawa Toyama The Hokkoku Bank The Hokuriku Bank THE TOYAMA BANK Tochigi Gunma The Ashikaga Bank Tottori Fukui Nagano The Gunma Bank Ibaraki The Hachijuni Bank The Joyo Bank Shimane THE TOTTORI BANK The Fukui Bank Gifu The San-in Godo Bank Kyoto Saitama The Kanto Tsukuba Bank The Ogaki Kyoritsu Bank The Musashino Bank Hyogo The Bank of Kyoto The Juroku Bank Okayama The Tajima Bank Tokyo Shiga Hiroshima The Chugoku Bank The Tokyo Tomin Bank Fukuoka Yamaguchi The Hiroshima Bank Osaka THE SHIGA BANK Chiba THE BANK OF FUKUOKA The Yamaguchi Bank The Kinki Osaka Bank Aichi The Chikuho Bank The Senshu Bank The Chiba Bank THE NISHI-NIPPON CITY BANK Kagawa The Bank of Ikeda The Chiba Kogyo Bank Saga Ehime The Hyakujushi Bank Mie THE BANK OF SAGA Oita The Iyo Bank The Mie Bank Tokushima Nara THE OITA BANK The Hyakugo Bank Kanagawa Nagasaki The Awa Bank The Nanto Bank Kochi Wakayama The Bank of Yokohama The Eighteenth Bank Kumamoto The Kiyo Bank The Shikoku Bank Yamanashi THE SHINWA BANK The Higo Bank The Yamanashi Chuo Bank Shizuoka Miyazaki THE SHIZUOKA BANK The Miyazaki Bank Kagoshima Suruga Bank THE SHIMIZU BANK THE KAGOSHIMA BANK （March 31,2008）
The number of regional banks 64 The number of branches 7,456 (including overseas branches) The number of ATMs 35,669 The number of directors
Okinawa and employees 127,587 Bank of The Ryukyus The Bank of Okinawa RegionalRegional BanksBanks inin JapanJapan
■ Japan’s Financial System There are three types of financial institutions in Japan: the central bank (Bank of Japan), private financial institutions, and public financial institutions. Private financial institutions can be divided into two main types, namely, institutions that accept deposits and others. In addition, institutions that accept deposits can be further broken down into banks, cooperative financial institutions, and the federations of cooperative financial institutions. Regional banks are banks licensed under the Banking Law, as are city banks and member banks of the Second Association of Regional Banks (most of which were mutual banks and have been registered as banks since 1989), and play a main role as commercial banks in Japan. Whereas city banks offer banking services to relatively many large corporate customers, regional banks (and member banks of the Second Association of Regional banks) focus their business mainly on retail banking. (See diagram: Breakdown of Financial Institutions in Japan) ■ Current Situation and Characteristics of Regional Banks Current Situation of Regional Banks As of March 31, 2008, there are 64 regional banks. Headquarters for regional banks are located in major and mid-size cities throughout the country, around which they have built major business bases. The majority of their loan customers, more than 80 percent, are local small and medium-sized companies and consumers. As for deposits, individual deposits account for approximately 70 percent of all the deposits. Characteristics of Regional Banks □ Main Financial Institution in Their Regions Regional banks have branch networks around their headquarters, and they function as the main financial service providers in the regions. Not only accepting deposits and financing, but also they are providing payment services to their customers through nationwide networks for ATMs and fund transfer. In addition, to meet the customers diversifying financial needs, they are offering securities services _ such as retail sales of government bonds and mutual funds _ and international services. They have also started to provide some insurance products and financial instruments intermediary services in line with recent progress of deregulation conducted by Japanese government. □ Regional Involvement Regional banks are making every effort to keep credit opportunities available constantly in the regions, and they are involved in numerous local community projects including sending their staffs, as well as joining volunteer activities to contribute to the regional society. These behaviors are based on their management principles “Growing in step with the regional communities” . In addition, they are contributing to financial stabilization of local public institutions, which include prefectural and municipal governments, by handling fiscal cash management as their designated financial institutions or through providing loans. □ Sound Management As regional banks’ business bases are in the specific regions, their keys for success are to win reliance from their customers in the regions. So they have given high priority for sound management for a long time. Recently, they have been trying to make their risk management techniques more highly sophisticated. They have been trying to use alternative channel such as Internet and to update IT infrastructure from the viewpoint of increasing efficiency of the operations.
2 Breakdown of Financial Institutions in Japan
CENTRAL BANK Bank of Japan
City banks Regional banks Member banks of the Second Association of Regional Banks BANKS (Tier II regional banks) Trust banks Foreign banks in Japan Japan Post (Japan Post Bank) Other banks INSTITUTIONS Shinkin banks Credit cooperatives THAT ACCEPT COOPERATIVE Labour banks DEPOSITS FINANCIAL Agricultural cooperatives INSTITUTIONS Fishery cooperatives Shinkin Central Bank (the central financial institution for the Shinkin banks) The Shinkumi Federation Bank (the national federation of credit cooperatives) The Rokinren Bank (the national federation of Labour banks) FEDERATIONS OF The Norinchukin Bank (the central bank for the Japanese agricultural, COOPERATIVE forestry, and fishery cooperatives) PRIVATE FINANCIAL Credit federations of agricultural cooperatives INSTITUTIONS Credit federations of fishery cooperatives FINANCIAL The Shoko Chukin Bank INSTITUTIONS (the central cooperative bank for commerce and industry)
Securities companies Securities finance companies SECURITIES Investment trust management companies RELATED Investment advisory companies COMPANIES OTHER Life insurance companies Nonlife insurance companies INSURANCE PRIVATE Japan Post (Japan Post Insurance) Various mutual aid systems FINANCIAL Consumer credit companies INSTITUTIONS Business loan companies OTHERS Leasing companies Mortgage securities companies Money market dealers
Development Bank of Japan Japan Bank for International Cooperation PUBLIC National Life Finance Corporation Japan Finance Corporation for Small and Medium Enterprise FINANCIAL Agriculture, Forestry and Fisheries Finance Corporation Japan Housing Finance Agency INSTITUTIONS Japan Finance Corporation for Municipal Enterprises The Okinawa Development Finance Corporation Other government affiliated financial bodies
(June 30, 2008)
3 Current Status of the Regional Banks
Shares of Deposits and Loans of Private Financial Institutions (March 31, 2008) Deposits Loans & di scounts Financial institutions
Financial institutions for agriculture, for agriculture, Others forestry and fishery 7.1％ Others forestry and fishery 10.6％ 8.3％ Regional 6.3％ Regional banks banks 23.1％ 26.6％ Shinkin banks 11.4％
＄8,735 billion Domestically licensed banks ＄5,609 billion Shinkin banks 13.1％ excluding regional banks, C5,486 billion city banks and C3,523 billion Domestically licensed banks tier II regional banks 7.7％ excluding regional banks, city banks and City banks City banks tier II regional banks 7.0％ 31.4％ Tier II regional banks 7.7％ 33.2％
Tier II regional banks 6.5％
Source : Bank of Japan Notes : (1)The figures above exclude those of Japan Post Bank (it is bellow the same) (2)Deposits include CDs, bank debentures and installment savings. (3)￥99.37=US$1, the middle rate between offers and bids surveyed from interbank market participants etc as of 5:00 p.m. at the date by Tokyo inter-bank market participants (it is bellow the same) (4)￥158.21= C1, the bid rate reported by the FRB of New York as of noon at the date (New York time), arbitraged on the Tokyo inter-bank market central rate (it is bellow the same)
Proportions of Deposits and Loans by Area (March 31, 2008) Deposits Loans & discounts Regional Areas Urban areas Regional Areas Urban areas
Regional Regional banks 67.1 32.9 banks 55.5 44.5
Domestically Domestically licensed banks licensed banks excluding 14.3 85.7 excluding 13.8 86.2 regional banks regional banks
0 20 40 60 80 100（％） 0 20 40 60 80 100（％） Sources : Regional Banks Association of Japan, Bank of Japan Note : Urban areas comprise Saitama, Chiba, Tokyo, Kanagawa, Aichi, Kyoto, Osaka, Hyogo and Fukuoka Prefectures. Regional areas comprise the remaining 38 prefectures.
Proportions of Deposits by Sector Proportions of Loans by Sector (March 31, 2008) (March 31, 2008) Financial institutions' deposits 1.3 Large enterprises Public deposits 3.8 Others 1.3 Medium-sized enterprises 3.7 Local governments 7.7
Corporations Regional Individuals 72.5 Regional 13.9 Small-sized enterprises 45.1 Individuals 29.6 banks 21.1 banks
3.3 2.1 3.3 3.1 2.0
Domestically Domestically licensed banks licensed banks excluding 31.3 60.0 excluding 22.7 45.9 26.3 regional banks regional banks
0 20 40 60 80 100（％） 0 20 40 60 80 100（％）
Sources : Regional Banks Association of Japan, Bank of Japan Sources : Regional Banks Association of Japan, Bank of Japan 4 Shares of Finance Provided for Local Governments DDomesticomestic FFundund TTransfersransfers bbyy TTypeype ooff IInstitutionnstitution (March 31, 2008) (April 2007 thru March 2008) Others 5.5％ Others 8.1％ The Shinkumi Federation Bank, credit cooperatives, etc.2.9% Shinkin Central Bank, Shinkin banks 13.3％ Shinkin banks 9.8％ Regional banks Regional 28.0％ banks Tier II regional banks 6.6％ Number of ＄211 billion 53.8％ transactions C132 billion 1,361 million cases
Domestically licensed banks excluding City banks regional banks 24.8％ 47.2％
Sources : Regional Banks Association of Japan, Bank of Japan Source : Japanese Bankers Association Note : “The Shinkumi Federation Bank, credit cooperatives, etc.” include the Rokinren Bank, labour banks, the Norinchukin Bank, credit federations of agricultural cooperatives, credit federations of fishery cooperatives, agricultural cooperatives.
PPublicublic BBondsonds aandnd IInvestmentnvestment TTrustsrusts HHeldeld iinn HHomeome MortgageMortgage LLoansoans HHeldeld bbyy RRegionalegional BBanksanks CCustodyustody bbyy RegionalRegional BBanksanks
Home mortgage loans / 30（％ ） ($billion) Total outstanding loans（right scale） ($billion) （Public bonds＋Investment trusts）／ （％） 500 Amount of home YEN Deposits（right scale） 16 mortgage loans（left scale） 240 400 25 220 14
350 200 Investment trusts （left scale） 12 20 180 300 160 Public bonds 10 250 （left scale） 15 140 120 8 200 100 6 150 10 80 100 60 4
5 40 50 2 20 0 0 0 0 3/04 3/05 3/06 3/07 3/08 3/04 3/05 3/06 3/07 3/08
Source : Regional Banks Association of Japan Source : Regional Banks Association of Japan Note: ¥99.37=US$1 Notes : (1)The figures above are those of individual customers. (2)¥99.37=US$1
Capital Adequacy Ratios ROA・OHR
（％） （％） （％） 13 A 1 70 12.73 12.48 11.82 OHR（right scale） 12 65 0.9 11.97 12.09 11 60 10.84 61.10 60.96 0.8 60.55 59.80 10.82 59.72 9.59 10 10.24 55 9.86 0.7 0.72 0.72 0.73 0.72 9 B 50 0.69 ROA（left scale） 0.6 8 45
7 0.5 40 3/04 3/05 3/06 3/07 3/08 3/04 3/05 3/06 3/07 3/08（FY）
Source : Regional Banks Association of Japan Source : Regional banks Association of Japan Notes : (1)A = figure for internationally active regional banks, according to the Basel standards Note : OHR=General and administrative expenses / Gross operating profits from (on a consolidated basis) core business (2)B = figure for domestically active regional banks, according to domestic standards ROA=Operating profits from core business / Total assets (on a non-consolidated basis) 5 (3)A bank which had negative capital adequacy ratio is excluded. Regional Banks Directory
Total Assets Name of Bank Head Office Telephone No. URL in US $ million in C million
The Hokkaido Bank Sapporo 011-261-7111 http：//www.hokkaidobank.co.jp/ 38,652 24,277
The Aomori Bank Aomori 017-777-1111 http：//www.a-bank.jp/ 21,258 13,352
THE MICHINOKU BANK Aomori 017-774-1111 http：//www.michinokubank.co.jp/ 18,771 11,790
The Bank of Iwate Morioka 019-623-1111 http：//www.iwatebank.co.jp/ 23,933 15,032
THE TOHOKU BANK Morioka 019-651-6161 http：//www.tohoku-bank.co.jp/ 6,514 4,091
The 77 Bank Sendai 022-267-1111 http：//www.77bank.co.jp/ 56,592 35,545
THE AKITA BANK Akita 018-863-1212 http：//www.akita-bank.co.jp/ 22,250 13,975
The Hokuto Bank Akita 018-833-4211 http：//www.hokutobank.co.jp/ 11,069 6,952
THE SHONAI BANK Tsuruoka 0235-22-5211 http：//www.shonai.co.jp/ 8,802 5,528
The Yamagata Bank Yamagata 023-623-1221 http：//www.yamagatabank.co.jp/ 18,410 11,563
The Toho Bank Fukushima 024-523-3131 http：//www.tohobank.co.jp/ 28,745 18,054
The Joyo Bank Mito 029-231-2151 http：//www.joyobank.co.jp/ 74,179 46,591
The Kanto Tsukuba Bank Tsuchiura 029-821-8111 http：//www.kantotsukuba-bank.co.jp/ 13,280 8,341
The Ashikaga Bank Utsunomiya 028-622-0111 http：//www.ashikagabank.co.jp/ 44,250 27,793
The Gunma Bank Maebashi 027-252-1111 http：//www.gunmabank.co.jp/ 59,795 37,557
The Musashino Bank Saitama 048-641-6111 http：//www.musashinobank.co.jp/ 34,202 21,482
The Chiba Bank Chiba 043-245-1111 http：//www.chibabank.co.jp/ 98,284 61,731
The Chiba Kogyo Bank Chiba 043-243-2111 http：//www.chibakogyo-bank.co.jp/ 21,115 13,262
The Tokyo Tomin Bank Tokyo 03-3582-8251 http：//www.tominbank.co.jp/ 24,529 15,406
The Bank of Yokohama Yokohama 045-225-1111 http：//www.boy.co.jp/ 116,993 73,482
The Daishi Bank Niigata 025-222-4111 http：//www.daishi-bank.co.jp/ 41,046 25,780
The Hokuetsu Bank Nagaoka 0258-35-3111 http：//www.hokuetsubank.co.jp/ 21,088 13,245
The Yamanashi Chuo Bank Kofu 055-233-2111 http：//www.yamanashibank.co.jp/ 26,185 16,446
The Hachijuni Bank Nagano 026-227-1182 http：//www.82bank.co.jp/ 60,573 38,045
The Hokuriku Bank Toyama 076-423-7111 http：//www.hokugin.co.jp/ 57,059 35,838
THE TOYAMA BANK Takaoka 0766-21-3535 http：//www.toyamabank.co.jp/ 3,791 2,381
The Hokkoku Bank Kanazawa 076-263-1111 http：//www.hokkokubank.co.jp/ 31,146 19,562
The Fukui Bank Fukui 0776-24-2030 http：//www.fukuibank.co.jp/ 21,407 13,446
The Ogaki Kyoritsu Bank Ogaki 0584-74-2111 http：//www.okb.co.jp/ 36,974 23,223
The Juroku Bank Gifu 058-265-2111 http：//www.juroku.co.jp/ 41,164 25,855
THE SHIZUOKA BANK Shizuoka 054-261-3131 http：//www.shizuokabank.co.jp/ 90,836 57,053
Suruga Bank Numazu 055-962-0080 http：//www.surugabank.co.jp/ 31,157 19,569
Notes : (1) Figures are shown as at the end of March 2008. (2) Homepage addresses as of the end of June 2008. (3) ￥99.37=US $ 1, ￥158.21= C 1
6 Total Assets Name of Bank Head Office Telephone No. URL in US $ million in C million
THE SHIMIZU BANK Shizuoka 054-353-5151 http：//www.shimizubank.co.jp/ 13,020 8,177
The Mie Bank Yokkaichi 059-353-3111 http：//www.miebank.co.jp/ 15,451 9,704
The Hyakugo Bank Tsu 059-227-2151 http：//www.hyakugo.co.jp/ 39,993 25,119
THE SHIGA BANK Otsu 077-524-2141 http：//www.shigagin.com 41,244 25,905
The Bank of Kyoto Kyoto 075-361-2211 http：//www.kyotobank.co.jp/ 66,691 41,888
The Kinki Osaka Bank Osaka 06-6945-2121 http：//www.kinkiosakabank.co.jp/ 36,206 22,741
The Senshu Bank Kishiwada 072-423-2131 http://www.senshubank.co.jp/ 21,441 13,467
The Bank of Ikeda Ikeda 072-751-3521 http：//www.ikedabank.co.jp/ 27,220 17,096
The Nanto Bank Nara 0742-22-1131 http：//www.nantobank.co.jp/ 45,805 28,770
The Kiyo Bank Wakayama 073-423-9111 http：//www.kiyobank.co.jp/ 35,181 22,097
The Tajima Bank Toyooka 0796-24-2111 http：//www.tajimabank.co.jp/ 8,273 5,196
THE TOTTORI BANK Tottori 0857-22-8181 http://www.tottoribank.co.jp/ 8,199 5,150
The San-in Godo Bank Matsue 0852-55-1000 http：//www.gogin.co.jp/ 36,545 22,954
The Chugoku Bank Okayama 086-223-3111 http：//www.chugin.co.jp/ 57,923 36,381
The Hiroshima Bank Hiroshima 082-247-5151 http：//www.hirogin.co.jp/ 61,464 38,605
The Yamaguchi Bank Shimonoseki 0832-23-3411 http：//www.yamaguchibank.co.jp/ 49,218 30,913
The Awa Bank Tokushima 088-623-3131 http：//www.awabank.co.jp/ 24,634 15,472
The Hyakujushi Bank Takamatsu 087-831-0114 http：//www.114bank.co.jp/ 36,811 23,120
The Iyo Bank Matsuyama 089-941-1141 http：//www.iyobank.co.jp/ 48,226 30,290
The Shikoku Bank Kochi 088-823-2111 http：//www.shikokubank.co.jp/ 24,605 15,454
THE BANK OF FUKUOKA Fukuoka 092-723-2131 http：//www.fukuokabank.co.jp/ 81,450 51,158
The Chikuho Bank Kurume 0942-32-5331 http：//www.chikugin.co.jp/ 5,736 3,602
THE NISHI-NIPPON CITY BANK Fukuoka 092-476-1111 http：//www.ncbank.co.jp/ 66,937 42,042
THE BANK OF SAGA Saga 0952-24-5111 http：//www.sagabank.co.jp/ 19,414 12,193
The Eighteenth Bank Nagasaki 095-824-1818 http：//www.18bank.co.jp/ 23,554 14,794
THE SHINWA BANK Sasebo 0956-24-5111 http：//www.shinwabank.co.jp/ 21,273 13,361
The Higo Bank Kumamoto 096-325-2111 http：//www.higobank.co.jp/ 35,869 22,528
THE OITA BANK Oita 097-534-1111 http：//www.oitabank.co.jp/ 26,079 16,380
The Miyazaki Bank Miyazaki 0985-27-3131 http：//www.miyagin.co.jp/ 18,615 11,691
THE KAGOSHIMA BANK Kagoshima 099-225-3111 http：//www.kagin.co.jp/ 31,402 19,723
Bank of The Ryukyus Naha 098-866-1212 http：//www.ryugin.co.jp/ 15,344 9,637
The Bank of Okinawa Naha 098-867-2141 http：//www.okinawa-bank.co.jp/ 13,821 8,681
7 The Regional Banks' Cooperations Improving Customer Services
The 64 regional banks carry out cooperative business operations for improving customer services. The banks are running the Credit Risk Information Total Service （CRITS）， to enable each bank to perform financial intermediary functions more sufficiently through enhanced credit risk management. The nationwide cash card service (ACS：All Chigin Card Service) allows customers, to withdraw cash from their deposit accounts via the regional banks network of 35,669 ATMs (at the end of March 2008). And the banks have set up corporations that operate the Bank Card system and the data transmission system of regional banks (CNS： Chigin Network Services). Bank Cards are multi-function cards issued by the regional banks that combine the features of cash cards and credit cards, while CNS is a firm banking system that links all the 64 regional banks.
Activities of the Regional Banks Association of Japan
The Regional Banks Association of Japan engages in activities that address various management issues common to all the regional banks, with the aim of fostering their sound development and thus contributing to the prosperity of regional economies. As the regional banks are expected to play a greater role to activate regional economies, the association intends to perform and improve the following functions: (1)providing information and assisting to establish their business strategies; (2)acting as the representative and the window of the industry; (3)promoting cooperative operations and development; (4)acting as a forum for the exchange of information among regional banks; (5)carrying out surveys and conducting research; and (6)providing educational services.
3-1-2 Uchikanda, Chiyoda-ku, Tokyo, Japan Telephone:Tokyo (03) 3252-5171 http://www.chiginkyo.or.jp/