The Yamanashi Chuo Bank, Ltd. The 32th Analyst Meeting

・Fiscal 2016 Business Results ・Forecasts for the Current Term (FY2017) ・Medium-Term Management Plan “S.T.E.P. up 2019” Progress Report

June 7, 2017 (Wed) Contents

Profile ２

I Fiscal 2016 Business Results and Ⅲ Medium-Term Management Plan Forecasts for the Current Term (FY2017) “S.T.E.P. up 2019” Progress Report

Fiscal 2016 Business Results (Summary) ４ Diagram of “S.T.E.P. up 2019” ２３ Earnings Forecasts for the Current Term (FY2017) ５ Basic Strategies and Financial Targets of iiiMedium-Term Management Plan “S.T.E.P. up 2019” ２４ Deposits ６ Individual Strategies Based on Basic Strategy I ２５ Loans ７ Strengthen retail solution banking ２５ Securities ９ Strengthen corporate solution banking ２６ Fees and Commissions １１ Strengthen coordination with industrial, Operating Expenses and OHR １２ government, and academic funds ２８ Credit Cost １３ Individual Strategies Based on Basic Strategy II ３１ Yields & Interest Margins １４ Optimal distribution of management resources, Advanced IT utilization, Fundamental operational Capital Ratio (Non-Consolidated Basis) １５ reforms ３１ Return to Shareholders １６ Western Bloc Strategy ３２

II Economic Trends in Business Trends １８ Yamanashi Prefecture Economic Topics １９ Local Industries in Yamanashi Prefecture ２０ Preparations for High-Speed Transportation Network ２１ － 1 － Profile

■ Profile (as of March 31, 2017)

・ Predecessor Founded: April 1877 ・ Established: December 1941 ・ Head Office: 20-8, Marunouchi 1-Chome, Kofu, Yamanashi ・ Common Stock: ¥15,400 million ・ Employees: 1,685 ・ Branches (including sub-branches): 91 (74 in Yamanashi Pref., 16 in Tokyo, 1 in Kanagawa Pref.), Representative Office: 1 (Hong Kong) Head Office

Our Mission

Region-Based Operations and Sound Management

Maintaining a close relationship with the communities in the region where we operate, we will contribute to the prosperity of the region and the development of its economy, with a commitment to sound management that enjoys the trust of our customers, while bolstering our business operations.

－ 2 － Ⅰ Fiscal 2016 Business Results and Forecasts for the Current Term (FY2017)

－ 3 － Fiscal 2016 Business Results (Summary)

（ ¥ billion, %） FY15 FY16 YoY change [%]

(analysisdifference factors) of FY16 (¥ billion, %) YoY change [%] Balance Yield Operating income ( ) 50.9 50.9 0.0 0.1 Fund operations 33.4 (2.6) ( (7.2) ) 0.5 (3.1)

Gross banking profit Interest income 38.6 37.7 (0.9)( (2.4) ) Interest on loans 16.6 (1.4) ( (8.0) ) 0.4 (1.9) Interest income 34.2 31.3 (2.8)( (8.4) ) Interest on securities 16.5 (1.1) ( (6.3) ) (1.7) 0.5 Fees and commissions 4.5 4.2 (0.3)( (7.9) ) Call loan, etc. 0.2 (0.0) ( (8.0) ) 0.2 (0.2) Other operating income (0.6) (2.1) (1.4)( (221.1)) Fund procurement 2.1 0.2 ( 15.4 ) 0.0 0.2 Gross banking prof it on core operations 38.1 33.4 (4.7)( (12.3) ) Interest on deposits 0.9 (0.5) ( (36.4) ) 0.0 (0.5) Interest income JGBs and other bond transactions 0.5 4.3 3.7( 696.3 ) Call money, etc. 1.1 0.8 ( 261.2 ) 0.2 0.6 31.3 (2.8) ( (8.4) ) - - Expenses 27.9 26.9 (0.9)( (3.3) )

General provision to loan loss reserve 1.6 (0.1) (1.7)( (106.9)) FY16 YoY change Fees and commissionsFees and (¥ billion) Net business profit 9.1 10.8 1.7( 19.1 ) Revenues 7.1 0.1 Net business profit on core operations ( ) 10.2 6.4 (3.7) (36.9) Investment trusts 0.8 (0.1)

3.7 (1.9) (5.6)( (151.1)) JGBs held by individuals 0.0 0.0 Gains on rev ersal of provision to loan ( ) Life insurance 0.8 0.1 Non-operatingloss reservlosses e ---- Reversal of loan loss reserve 0.0 0.5 0.4( 520.2 ) Others 5.4 0.1 Equity share and similar transactions 5.2 4.5 (0.6)( (12.9) ) Cost 2.8 0.4 Fees and commissions Of which, loss on dissolution of investment trusts 1.8 5.2 3.3( 178.7 ) 4.2 (0.3) 12.8 8.9 (3.8)( (30.2) ) (¥ billion) FY16 YoY change

Ordinary profits Expenses (0.1) (0.2) (0.1)( (153.4)) Extraordinary income (losses) Personnel 15.4 0.2 12.7 8.6 (4.0)( (31.9) ) Premises and equipment Income before income taxes 10.1 (1.1) ( ) Income taxes - basic 3.9 2.1 (1.8) (46.1) Taxes 1.3 (0.0) ( ) Income taxes - deferred 0.0 (0.1) (0.2) (430.6) Expenses 26.9 (0.9) Net income 8.7 6.7 (2.0)( (23.2) ) － 4 － Earnings Forecasts for the Current Term (FY 2017)

(¥ billion, %) FY16 FY17 YoY change [%] FY17 (forecast) (analysisdifference factors) of (¥ billion, %)(forecast) YoY change [%]Balance Yeild Fund operations Operating income 50.9 42.2 (8.7) ( (17.2) ) 32.4 (0.9) ( (2.9) ) 0.4 (1.4)

Gross banking profit 37.7 32.6 (5.1) ( (13.3) ) Interest income Interest on loans 16.3 (0.3) ( (1.8) ) 0.2 (0.5) Interest income Interest on 31.3 29.5 (1.8) ( (5.7) ) securities 15.7 (0.8) ( (5.1) ) (0.7) (0.0)

Fees and commisions 4.2 5.4 1.2 ( 27.7 ) Call loan, etc. 0.4 0.1 ( 69.1 ) 0.0 0.0

Other operating income (2.1) (2.2) (0.1) ( (4.5) ) Fund procurement 2.9 0.8 ( 38.1 ) 0.0 0.7 Gross banking profit on Interest on Interest income 0.5 (0.4) ( (45.5) ) 0.0 (0.4) core operations 33.4 32.6 (0.8) ( (2.1) ) deposits JGBs and other bond Call money, etc. 2.4 1.2 ( 107.8 ) 0.5 0.7 transactions 4.3 - (4.3) ( (100.0) ) 29.5 (1.8) ( (5.7) ) - - Expenses 26.9 27.4 0.5 ( 1.6 ) General provision to loan FY17 loss reserve (0.1) 0.0 0.1 ( 146.0 ) Fees and commissionsFees and (¥ billion） (forecast) YoY change Net business profit 10.8 5.2 (5.6) ( (52.2) ) Revenues 8.0 0.9 Net business profit on core operations 6.4 5.3 (1.1) ( (17.7) ) Investment trusts 0.9 0.0 Non-operating losses (1.9) (0.1) 1.8 ( 91.1 ) JGBs for individual investors 0.0 0.0 Life insurance 1.0 0.3 Reversal of loan loss reserve 0.5 0.5 0.0 ( 0.5 ) Equity share and similar Others 6.0 0.6 transactions 4.5 1.2 (3.3) ( (72.4) ) Of which, loss on dissolution Cost 2.6 (0.2) of investment trusts 5.2 - (5.2) ( (100.0) ) Fees and commissions 5.4 1.2 Ordinary profits 8.9 5.1 (3.8) ( (43.1) ) Net income FY17 6.7 3.5 (3.2) ( (47.8) ) (¥ billion) (forecast)YoY change Expenses Dividends Personnel 15.6 0.1 FY15 FY16 FY17(plan) Premises and equipment 10.4 0.2 Dividend per share (annual) ¥10.00 ¥9.00 ¥7.00 Taxes 1.4 0.0 Exprenses End of FY3/17 End of FY3/18 (estimate) 27.4 0.5 Nikkei Stock Average ¥18,909 ¥18,909 － 5 － Deposits

Balance by Customer Segment (average balance) Deposit (average balance) （billion） 3,000 +18.6 +1.8 (¥ billion) (¥ billion) (+0.6%) (+0.0%) Total 2,813.2 2,834.2 2,852.8 2,854.6 2,500 2,717.8 Total 2,631.3 212.1 187.4 2,852.8 2,854.6 243.4 239.3 Local 2,834.2 236.3 government 2,813.2 230.5 Tokyo Bloc bodies 68.3 70.0 65.5 586.1 ( billion) 2,717.8 78.6 2,000 562.1 558.1 587.5 540.1 2,631.382.1 517.1 3,000 263.7 273.6 267.6 Western Corporate 72.5 264.0 customers 252.0 Tokyo Bloc 1,500 237.7 Gunnai 447.5 452.5 460.0 1,000 439.4 Area 2,053.2 2,080.9 Individuals 2,500 1,941.3 2,007.6 2,036.7 422.4 1,883.7 406.1 500

Results Plan 2,000 0 FY12 FY13 FY14 FY15 FY16 FY17

Deposit Shares in Yamanashi Prefecture (term-end) 1,500 100% 1.7% 1.8% 1.7% 1.8% 1.7% 12.6% 12.7% 12.9% 13.0% 13.1% Semi-government institutions

2,031.0 2,054.6 2,056.7 2,061.3 1,961.2 Kuninaka Agricultural 1,914.9 cooperatives 1,000 Area 28.5% 28.0% 28.0% 27.7% 28.6% Shinkin banks/ credit unions 7.5% 7.3% 7.2% 7.1% 7.0% 50% Major banks 500 (0.8)P

Results Plan 49.7% 50.2% 50.2% 50.4% 49.6% Yamanashi Chuo Bank

0 ゆうちょ銀行 FY12 FY13 FY14 FY15 FY16 FY17 を除く

0% － 6 － FY12 FY13 FY14 FY15 FY16 Loans(1)

Loan (average balance) Balance by Customer Segment (average balance)

+24.3 （\ billion） (¥ billion) +36.7 (+1.6%) 1,498.3 1,522.6 Total (+2.5%) 1,459.3 1,446.9 1,447.7 1,461.6 1,500 258.1 National 235.3 298.2 257.6 300.6 315.8 and local government 1,522.6 1,800 （billion） 1,498.3 bodies Total 1,000 1,459.3 1,446.9 1,447.7 1,461.6 848.1 867.1 173.4 Loan assets 808.4 767.2 768.1 819.3 Private- 185.9 138.4 under the sector 1,600 141.1 166.9 178.0 control of corporations head office 500 departments* 1,400 375.9 380.8 379.9 377.5 380.7 397.3 330.2 Individuals 345.0 325.3 318.5 304.3 304.8 Tokyo 0 Bloc FY 12 FY13 FY14 FY15 FY16 FY17 1,200 Results Plan

198.1 219.0 Western 159.7 166.5 168.2 173.8 1,000 Tokyo Bloc Loan Shares in Yamanashi Prefecture (term-end) 100% 112.2 111.6 110.0 106.7 102.7 107.0 Gunnai Area 9.1% 9.1% 9.2% 9.3% 9.2% 800 Semi-government 7.3% 7.3% 7.3% 7.1% 6.7% institutions Agricultural 600 cooperatives 33.6% 33.8% 33.5% 32.3% 34.2% Kuninaka Shinkin banks/ credit unions 400 703.8 702.1 698.1 698.1 692.8 692.8 Area 50% 8.9% 8.9% 9.2% 9.5% 8.8% Major banks

200 (0.7)P Yamanashi Results Plan 41.1% 40.9% 40.8% 41.8% 41.1% Chuo Bank

0 FY12 FY13 FY14 FY15 FY16 FY17

*Note: Loan assets under the control of head office departments refers to loans to the Ministry of Finance, loans 0% made under loan participation agreements and financial receivables transferred from other industries. FY12 FY13 FY14 FY15 FY16 － 7 － Loans (2)

Balance of Loans to SMEs (term-end) and Number of Business Loans 11,000

（ Number of loans ） (¥ billion) 650 10,000 9,972 Number of business loans 600 9,644 9,457 9,000 9,200 9,121 8,829 8,921 550 8,829 8,795 8,860 Term-end balance 8,000 （¥ billion ） 500 +37.1 (+7.4%) 7,000 539.0 450 520.2 491.7 501.9 496.2 471.3 473.3 451.2 455.3 456.3 6,000

400 5,000 FY12 FY13 1H FY13 FY14 1H FY14 FY15 1H FY15 FY16 1H FY16 FY17 1H

350 Results Plan （※中小企業向け貸出金残高は、不動産関連地方公社向け貸出金を含む）

－ 8 － Securities (1)

Securities (average balance) Changes in interest dividends or securities yield

(¥ billion) (137.2) (61.8) （billion）(¥ billion) 12.0 13.7 15.4 17.6 16.5 15.7 Total ((9.6)%) ((4.8)%)

1.29% 1.28% 1.24% 1,419.1 20 1,366.8 1,389.8 1.11% 2.2 1,293.1 1.00% 0.93% 0.8 1,281.9 15 0.3 4.1 Foreign 1.0 5.1 bonds 1,220.1 Total 0.1 3.3 5.4 0.6 1.1 1.0 1.3 4.4 10 1.4 4.6 Investment 12.8 41.3 trusts 38.8 127.4 Foreign 1.2 3.3 1,60046.0 99.5 bonds 20.7 9.9 11.3 8.5 1.1 43.9 46.6 10.3 205.0 6.6 Stock 211.9 5 1,400 213.0 4.8 217.9 223.4 258.4 Yen 239.6 192.2171.5 43.9 Results Plan bonds 265.0 118.3 222.3 0 1,200 Investment trusts FY12 FY13 FY14 FY15 FY16 FY17 37.4 374.4 6.0 1,000 74.9 Stock 194.2 5.0 34.0 Changes in bond modified duration 800 Corporate 39.9 5.5 bonds 5.3 5.4 4.0 5.1 5.2 158.6 5.0 838.0 4.9 600 793.2 807.1 Municipal 4.7 bonds 4.4 4.4 4.4 4.5 701.9 3.0

400 498.3 JGBs 2.0 354.5 200 Foreign 1.0 bonds Results Plan Yen 0 bonds FY12 FY13 FY14 FY15 FY160.0 FY17 FY13 FY14 FY15 1H FY15 FY16 1H FY16 － 9 － Securities (2)

120 Securities (subject to mark-to-market valuation) Changes in interest評価損益の推移 dividend-yield securities 100 （billion） 1.5 (35.0) (242.0) (¥ billion) （billion）(¥ billion) 99.6 ((38.6)%) ((16.9)%) 80 90.5 1,430.4 48.2 5.0 1,418.4 60 32.8 1,360.7 1,315.4 58.00.1 0.0 57.3 79.1 55.5 Total 3.7 19.8 60.4 216.8 40 22.9 22.4 27.7 43.1 47.6 152.2 31.8 1,188.4 Total Stock 46.3 27.7 37.8 20 Yen 265.1 205.3 bonds 25.9 21.1 1,600 Foreign 22.1 24.8 Investment bonds 14.8 trusts 39.3 0 9.0 8.4 (0.7) (0.4) FY12 FY13 FY14 FY15 FY16 Foreign 1,400 352.9 229.4 203.2198.4 210.5 bonds 225.4 (20) 141.0

1,200 Investment 33.8 trusts 89.2 Changes有価証券関係損益の推移 in securities gains and losses 227.3 1,000 Stock (¥ million)(¥ million) Corporate 8,000 800 52.1 bonds Stock-related gains Stock-related And losses 162.1 Municipal gains and losses 4,541 818.1 818.9 bonds 600 774.2 6,000 Bonds-related gains

592.4 and losses 400 4,000 JGBs Bonds-related gains 381.9 5,219 and losses 200 4,324 2,000 16 0 740 FY 12 FY13 FY14 FY151,500 FY16 1,032 0 284 10 543 FY12 FY13 FY14 FY15 FY16 － 10 － Fees and Commissions

Fees and Commissions / Fees and Commissions Ratio Sales for Investment Trusts, Life Insurance Products and JGBs

(billion)(¥ billion) (¥ billion) 100 +16.6 16 (+33.9%) 16.51% (7.5) 80 ((13.2)%) 65.5 14 60.9 Total ¥ 4,226 million ¥ 5,400 million 60 56.4 ¥ 32,698 million 51.3 ¥ 37,749 million 48.9 Life insurance products Fees and 42.7 28.8 34.5 12 commissions ratio 40 21.1 31.5 12.10% 27.7 JGBs for 11.86% 20.5 11.43% 11.19% 6.4 5.4 individuals 11.44% 9.2 2.4 20 4.4 3.3 10 +0.9 25.6 Investment (+12.8%) 25.7 22.5 17.9 17.8 21.0 trusts +0.1 Results Plan (+1.2%) 8.0 Total 0 8 Investment FY12 FY13 FY14 FY15 FY16 FY17 6.9 7.0 7.1 trusts,life 6.6 6.5 2.0 insurance, and Commissions for Sales of Investment Trusts, JGBs for 1.6 1.6 Life Insurance Products and JGBs Held by Individuals 6 1.2 1.2 1.6 individuals （¥ billion） 1.4 Domestic +0.01 +0.4 (+22.4%) 1.4 1.3 1.4 1.3 1.3 exchange 2.5 (+0.4%) Total transfer 2.0 4 2.0 Life insurance Safe-deposit box 1.6 1.6 1.6 products · ATM-Account 1.5 1.2 1.0 transfer other 1.2 0.7 4.5 0.6 0.8 JGBs for 3.9 3.9 3.9 3.9 4.0 1.0 0.4 0.0 0.0 0.0 2 0.5 0.0 0.0 individuals 0.0 0.5 0.8 0.9 0.9 0.8 0.9 0.6 Investment Results Plan 0.0 trusts 0 FY12 FY13 FY14 FY15 FY16 FY17 FY12 FY13 FY14 FY15 FY16 FY17 Results Plan * Fees and commissions ratio= Fees and commissions / Gross banking profit － 11 － Operating Expenses and OHR

（billion）(¥ billion) (0.71)P +12.39P 50 ¥ 26,982 million OHR ¥ 37,749 million 83.86%

74.89% 73.61% 73.57% 72.18% 71.47% ¥ 27,423 million 40 ¥ 32,698 million ¥ 27,927 million ¥ 38,691 million (0.9) +0.5 ((3.3)%) (+1.6%)

30 28.5 28.1 27.9 27.9 26.9 27.4 Total 1.0 1.0 1.2 1.4 1.4 1.3 Enterprise tax 11.6 11.7 11.5 11.2 10.4 20 10.1 Non- personnel expenses

10 15.4 15.7 15.3 15.1 15.2 15.6 Personnel expenses

Results Plan 0 FY12 FY13 FY14 FY15 FY16 FY17

*OHR=Operating expenses / Gross banking profit on core operations － 12 － Credit Cost

Credit cost ratio = Total credit cost / Average loan balance Total credit cost = General provision to loan loss reserve + Provisions to Total Credit Cost / Credit Cost Ratio specific loan loss reserve + Loans written-off + Loss on sale of claims + Others

¥0.6 billion （\ billion） ¥1,522.6 billion 30 28.8 Credit cost ratio 2.23%

25

(0.09)P +0.01P 20 1.25% 0.92% 16.1 0.47% 15 0.36% 13.5 0.16% 0.07% 0.09% 0.11% 0.31% 0.37% 0.02% 0.02% 0.03% 0.15% 0.20% 10 0.03% Total credit cost (0.02)% (0.06)% (0.06)% (0.10)% 6.9 +0.2 5.1 5.1 (1.3) 5 4.3 2.9 2.2 2.1 1.4 1.7 0.9 0.4 0.3 0.4 0.6 0 (0.3) (0.9) (0.9) (1.5) Results Plan (5) FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17

－ 13 － Yields & Interest Margins (％) 2.07

2.00 1.90

1.74 1.64

1.53

1.50 1.42 1.33 1.29 Yield on securities 1.25 1.24 (yen-denominated) 1.18 1.15 1.16 1.10 1.08 1.19 1.08 Yield on loans 1.16 1.16 1.17 1.03 1.11 (yen-denominated) 1.00 1.07 1.07 0.99 0.99 0.92 0.98 0.94 0.96 Cost ratio

0.66 0.58

0.50 0.48 Loan/deposit 0.41 0.39 margin 0.33 0.33 0.27 0.28 0.22 0.21 Interest margin 0.24 0.14 0.13 0.10 0.12 0.14 0.09 0.15 0.08 0.17 Interest on 0.11 deposits 0.06 0.06 0.05 0.05 0.05 0.03 (yen-denominated) 0.00 0.03 0.01 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17

Plan － 14 － Capital Ratio (Non-Consolidated Basis)

Changes in equity ratio Breakdown of Regulatory Capital

19% (¥ billion)

FY13 FY14 FY15 FY16

Regulatory capital 161.0 164.8 172.2 175.6

18% Risk-weighted assets 965.8 986.9 984.0 1,076.8 17.50%

Risk-weighted Assets Methods Employed 17% 16.67% 16.70% Credit risk Standardized Approach (SA) 16.30% Operational risk Basel II Standardized Approach (TSA)

16% （ reference ） Interest rate risk of bank account（End of FY3/17） (¥ billion %) The capital ratio of 16.30% ranks first Interest rate 15% among 54 domestic banks to which 28.8 the standard is applied. risk amount (Source: Internal research) Amount o f capital 175.6 14% Outlier ratio 16.4%

※ We use internal model to calculate core deposits

13% FY13 FY14 FY15 FY16

－ 15 － Return to Shareholders

Work toward increasing the level ＜The introduction of of internal reserves required to To pay a stable annual dividend of Dividend performance-linked dividend＞ ¥7 per share and set the shareholder maintain sound management To enhance the return of profits while at the same time providing return rate through dividend and Policy to shareholders, the following share buybacks at 20% - 30% per for the stable payment of will be performed from FY15. dividends. year.

Paid 70th Anniversary Commemorative dividend of ¥1.00 Dividend increase of ¥0.5 (interim ¥3.5, year-end ¥3.5) (interim ¥3.25, year-end ¥3.75) interim ¥4.50, year-end ¥4.50 Trends in Dividend Payment Dividend increase of ¥0.5 Dividend increase of ¥3.00 (interim ¥3.0, year-end ¥3.5) (interim ¥5.00, year-end ¥5.00) FY17 FY11 FY12 FY13 FY14 FY15 FY16 (forecast) Div idend per share (annual) ¥7.00 ¥6.00 ¥6.50 ¥7.00 ¥10.00 ¥9.00 ¥7.00 Period-end share price ¥368 ¥429 ¥466 ¥526 ¥413 ¥498 - Div idend yield 1.90% 1.39% 1.39% 1.33% 2.42% 1.80% - Acquired 550 thousand shares in Apr. Acquired 2,079 thousand Acquired 2,209 thousand 2013 and 1,378 thousand shares in Feb. shares on Dec. 2011 shares in Feb. 2016 2014

Acquired 2,600 thousand shares Acquired 1,577 thousand Acquired 2,127 thousand Return to Shareholders between Feb. 2013 and Mar. 2013 shares in Feb. 2015 shares in Dec. 2016

FY17 FY11 FY12 FY13 FY14 FY15 FY16 (¥ million) (forecast )

Annual dividend (1) 1,256 1,062 1,134 1,211 1,712 1,521 1,175

Treasury stock acquired (2) 644 989 835 834 899 1,235 -

Return to shareholders (3)=(1)+(2) 1,901 2,052 1,970 2,045 2,611 2,757 1,175

Net income (non-consolidated) (4) 6,965 5,870 7,898 8,200 8,737 6,710 3,500

Dividend payout ratio 18.08% 18.22% 14.42% 14.83% 19.70% 22.73% 33.59%

Shareholder return ratio (3)/(4)x100 27.29% 34.95% 24.94% 24.94% 29.88% 41.08% 33.59% － 16 － II Economic Trends in Yamanashi Prefecture

－ 17 － Business Trends 1.9 1.4 Gross Production by Economic Activity 30 Diffusion Index for Yamanashi Prefecture (Industrial24.3 Sector = 100） (BOJ’s Tankan Survey) 35.7 （Unit=％） Agriculture,forestry, 6.2 fisheries/mining Non- 1.6 Manufucturing 20 manufacturing 10 All industries 9 7.4 14.4 Construction Manufacturing 7 1.2 Utilities 9.5 6.3 Wholesale/retail 10 4.0 13.1 Financing/insurance 14.6 Real estate 11.9 0 6.8 Transport/ communications Services 18.9 20.8

(10) *Yamanashi Prefecture: FY14 Annual Report on Prefectural Accounts Yamanashi Japan: 2014 Annual Report on National Accounts Non- Prefecture manufacturing 6 Percentage of Shipments of Products All industries 6 Manufactured in Yamanashi Prefecture (20) Manufacturing 6 （2014）

(30)

9 9 12 12 FY14 6 9 12 FY15 6 9 12 FY16 6 (estimate) 3 27/ 6 9 Concentrated in Machinery Industry –IT-Related, etc 12 28/3 6 (Bank of Japan, Kofu Branch) Economic Census 9 12 /3 29 測） （予 6 － 18 － Yamanashi Prefecture Economic Topics

Effects on Yamanashi The Bank's Initiatives for Economic Revitalization Topics Prefecture for Yamanashi Prefecture

- Meeting demand for funds from tourist destinations and facilities Increase in tourists - Meeting demand for settlement/currency conversion from foreign June 2013 ・In 2016, number of Japanese and foreign tourists tourists increased in terms of hotel stays in the prefecture - Improvement of the prefecture business operator’s acceptance of foreign guests to Mt. Fuji designated as a World Japanese tourists: 6.80 million (+0.5% YoY) Japan Heritage Site Foreign tourists: 1.37 million (+9.6% YoY) * Accomplishments: Entered into partnership agreement with APLUS Co., Ltd. for * Highest (preliminary) number since 2007 introducing Chinese people to the mobile payment service WeChat Pay, and implemented when survey began the Katakoto English Project. Credit and payment terminals are provided free of charge to food and drink establishments at the foot of Fuji North and the south foot of Yatsugatake.

-Cooperation with the Yamanashi Prefectural Government to increase the June 2013 Increase in residents resident population ・ Prefectural Government opened In fiscal 2016, people asked for information about ・Began offering housing loans in collaboration with six cities, five towns and one Yamanashi Living Assistance Center moving to Yamanashi Prefecture 2,986 times (+541 YoY) village in Yurakucho at the “Yamanashi Living Support Center” (in Yurakucho, * Hokuto City, City, City, Minami-Alps City, Nirasaki City, March 2014 Tokyo), of which 154 people actually moved. Tsuru City, Town, Town, Minobu Town, ・Yamanashi Prefecture ranked No. 1 according to “2016 Began employment service at this Nanbu Town, Fujikawa Town, Doshi Village rankings of most desired regions for living” (Return to Your center - Conclusion of partnership agreement with the local government for regional Hometown Support Center survey) Revitalization in Hokuto City and Uenoharacity and Tsuru City

FY2019 Increase in tourists visiting Yamanashi -Strengthening cooperation with the government measures, Chubu Odan Expressway Prefecture prefectural-wayside cities and towns Opening from Futaba - to and orders opportunity -Business matching strengthening of the prefecture companies Shinshimizu Expansion of distribution centers -Funds corresponding on-logistics base installation, etc. December 2015 - Meeting demand for funds for the development of areas surrounding stations Maglev Chuo Shinkansen construction - Provision of loans to those who intend to move to Yamanashi Prefecture approval Progress developing areas surrounding - Cooperation with the Yamanashi Prefectural Government to increase the March 2017 stations resident population Yamanashi Prefecture created “Linear (such as new housing areas) -Signed comprehensive collaboration agreement on regional creation with Bank Environmental Future City” of Tokyo-Mitsubishi UFJ improvement policy

Increase in attention to wine using Koshu grapes - Strengthening of support for export July 2013 In Europe and Southeast Asia (such as exhibitions at overseas business meetings and cooperation "Yamanashi" wine designated ‐Koshu wine exports increased more than 20 times over with foreign partner banks) five years thanks to successful public-private PR campaign in by the National Tax Agency as central London, a global wine market. On February 1, 2017, - Enhance business feasibility studies for wine-related companies by a geographical indication at a hotel in London, 11 prefecture wineries jointly held a involving bank employees who have experience working with wineries tasting event for Koshu wine. => Leverage ability to make good judgments, address funding needs － 19 － Local Industries in Yamanashi Prefecture

Wine Sake Mineral Water

- 21.0% share of shipment amount ranks second in Japan. - 29.3% share of shipment amount ranks first in Japan. - "Yamanashi" wine designated as an indication (National Tax Agency)

Fruits Jewelry Silk Fabric

- Shipment amount of ties ranks third in Japan. - Harvest of grapes, peaches and Japanese plums ranks first in Japan. - 25.5% share of shipment amount ranks first in Japan. - Shipment amount of down quilts ranks second in Japan.

Knit Products Inden Leather Traditional Japanese Paper

- Shipment amount of shoji paper and calligraphy paper ranks second in Japan.

*Source: 2014 Census of Manufacturer, 2016 Census of Crops

－ 20 － Preparations for High-Speed Transportation Network

Expected Effects: Increase in tourists from Kansai and Tokai regions, increase in opportunities for receiving orders, expansion of logistic facilities, and increase in residents due to expanded commuting radius to Greater Tokyo

Maglev Chuo Shinkansen Line Chubu Odan Expressway

Saku-Komoro Joshin-etsu ・October 17, 2014: Minister of Land, Infrastructure, Transport and JCT Saku-Minami IC – Expressway Tourism approved the start of construction, with opening Saku Komoro JCT Opened to traffic in March 2011 planned for 2027 Yachiho IC – Nishi Kanto Expressway ⇒ Request for certain segments to enter service by the start Yachiho Saku-Minami IC Scheduled to open in 2017 To Hanazono (Saitama Pref.) of the 2020 Tokyo Olympic Games Chuo Expressway Nagasaka JCT – Yachiho IC Connected to Kan-etsu Expressway “Planning stage assessment” began in Dec. 2010 Okegawa ・ December 2015: Yamanashi side section construction schedule Chubu Odan kitamoto IC of the Southern Alps tunnel (total length 25 km) Nagasaka Expressway Ken-o Expressway ・January 2016: Shinagawa Station construction

Futaba Chuo Expressway ・November 2016: Nagano-machi-gun started construction of Chubu Odan Expressway Minami Alps tunnel Kofu Hachioji JCT Shirane ・March 2017: Yamanashi Prefecture creates “Linear Environmental Otsuki Future City” improvement policy Minami Alps Takaosan IC Rokugo IC – Shimobe-onsen hayakawa IC Scheduled to open in 2018 Masuho Masuho IC – Rokugo IC opened in March 19, 2017 Takaosan IC – -Aikawa IC Fuji- Map of Maglev Chuo Shinkansen Line Route Rokugo opened in June 28, 2014 yoshida

Shimobe-onsen hayakawa IC － Nanbu IC Subashiri IC – Gotemba IC Sagamihara- Nakatomi Aikawa IC Scheduled to open in 2019 Higashi-fujigoko road Began site negotiations in 2012 Yamanashi Pref.：Requests opening by 2020 Scheduled to start Shimobe-onsen Subashiri IC operation in 2027 Hayakawa Ebina IC Nakatugawa Iida Minobusan Shinagawa Gotemba IC Kofu Sagami- hara Nanbu Shin-Tomei Yamanashi Expressway Gotemba JCT Nagoya Maglev Test Line Tomizawa

Tomei Expressway Nara Travel Time Osaka Nanbu IC － Shin-shimizu JCT Shinagawa-Kofu 25 min Scheduled to open in 2018 Shin-shimizu Shinagawa-Nagoya 40 min JCT Shinagawa-Osaka 67 min By Shizuoka towards the opening of the Central crossing the motorway While Kofu City, Shizuoka accessed in one hour and 40 minutes (about △ 1 hour) ※ Station locations further west of Nagoya are undecided. － 21 － Ⅲ Medium-Term Management Plan “S.T.E.P. up 2019” Progress Report

－ 22 － Diagram of “S.T.E.P. up 2019”

Management vision (Ideal A Bank that grows and develops together with Yamanashi and and prospective image) its surroundings as a driving force for regional economic revitalization Live up to the trust accorded by customers and Theme during the plan contribute to regional revitalization Enhance stakeholder satisfaction (society, customers, shareholders, and employees)

Establish a financial and revenue base supporting sustainable growth

Realization of a business model adapted to changes in the environment Selection and concentration, and differentiation from other financial institutions

Strengthen retail Strengthen corporate Strengthen coordination with industrial, Strengthen and expand the capital solution banking solution banking government, and academic funds markets investment approach

Build and strengthen a robust management structure

Optimally redistribute management Develop human resources and resources such as branches, human Advance IT utilization strengthen organizational capabilities resources and IT systems Fundamentally reform and reengineer Strengthen the approach and enhance operations based on sophisticated the effectiveness of internal control risk management approaches

Strengthen the enhancement of Strengthen CSR activities customer and employee satisfaction Rigorously enforce compliance and the protection of customers and their privacy － 23 － Basic Strategies and Financial Targets of Medium-Term Management Plan “S.T.E.P. up 2019”

＜Basic Strategies Ⅰ＞ Realization of a business model adapted to changes in the environment Selection and concentration, differentiation from other financial institutions ・Increase and strengthen earnings with efficient and effective banking activities by selecting priority initiatives and channeling the redistribution of management resources. ・Strengthen earnings capabilities by deepening the scope of banking transactions in existing markets while focusing on the creation of new earnings opportunities. ・Differentiate the Bank from other financial institutions with initiatives including the development of products and services and the improvement ofmarketing skills. This will be done to respond pertinently and promptly to the increasingly sophisticated and diverse needs of customers, as well as by banking with a greater number of customers. ・Endeavor to drive regional economic revitalization and create business opportunities for the Bank. This will be done by upgrading Yamanashi Chuo Bank’s financial intermediary functions in collaboration with more specialized institutions, and by leveraging the Bank’s own expertise and network. ・Secure and expand steady income streams by strengthening and expanding the Bank’s capital markets investment approach.

＜Basic Strategies Ⅱ＞ Building and strengthening a robust management structure ・Develop an organization in which each employee can have a motivating and fulfilling career. This will be done by fostering confident and diligent human resources who are capable of taking self-motivated and independent action. ・Build a highly profitable structure through the optimal distribution of management resources. This will be done primarily by optimizing the locationof branches and assignment of personnel, strengthening the operational framework of IT systems, and optimizing costs. ・Strengthen and expand the revenue base by realizing a consistent approach to sales in all channels. This will be done by making effective use of IT and upgrading non-OTC sales channels. ・Expand earnings opportunities by examining and developing new banking operations. This will be done by fundamentally reforming existing operations and generating more banking activity man-hours and personnel. ・Further strengthen the Bank’s risk management approach including for credit risk and asset-liability management (ALM). ・Strengthen compliance and the protection of customers and their privacy as a management foundation and increase employee awareness. Term-end balance of Term-end balance of (¥ billion) (¥ billion) Net business deposits, etc. (¥ billion) loans(¥ billion) 15 3,500 3,260.0 FY1 5 FY1 6 Plan targets Change between profit(¥ billion) Net income 2,941.1 2,968.7 2,987.1 2,996.4 Item 3,000 Results Results (Year ending March 2019) FY2016 and FY2019 10.8 (¥ billion) 10.0 9.4 9.1 9.5 2,500 Net business profit 9.1 10.8 ＋ 10 8.7 9.5 0.4 7.8 8.2 2,000 1,495.9 1,548.4 1,590.0 6.7 6.0 1,447.5 1,521.3 1,500

Net inc ome 8.7 6.7 5 6.0 (2.7) 1,000

Year-end balance of deposits, Targets 500 Targets etc. (deposits + investment 2,987.1 2,996.4 3,260.0 ＋272.9 trusts + public bonds) 0 0 Year-end FY13 FY14 FY15 FY16 FY18 FY13 FY14 FY15 FY16 FY18 balance of 1,521.3 1,548.4 1,590.0 ＋68.7 loans － 24 － Individual Strategies Based on Basic Strategy I (1) Strengthen retail solution banking

Priorities Establish an approach for marketing personal loans

・Increase both earnings and the balance of personal loans ・Developing a consulting business centered on total asset banking うby breaking strategic bottlenecks ・Provide products and services promoting Yamanashi Chuo Bank (1) Increase and strengthen customer contact ・Increase the balance by strategically as the main bank (2) Provide competitive products and services re-examining personal loan products ・Develop lifelong business relationships around personal loans ・Strengthen the function of Non-OTC ・Develop human resources with professional knowledge and practical skills (3) Build an approach foreseeing changes ううin the environment channels ・Strengthen collaboration between retail branches and LS

Make more proposals for asset succession （¥ billion） and inheritance to affluent customers 400 381.9 382.7 381.5 377.8 386.0 11.9 Total ・Hold individual consultations about asset succession, and seminars 15.4 14.8 13.6 12.6 うon inheritance and wills Other loans う→ Uncover needs for asset succession (inheritance)

・Build up a portfolio of testamentary trust and estate liquidation projects 366.5 367.9 367.9 365.2 374.1 Housing loan iiby strengthening collaboration with Asahi Chuo う 300 ii→ No. of contracts: 28 (Cumulative no.: 102) ・Propose solutions for business succession to company owners う→ Market corporate insurance policies to corporate deposit holders ううううand new corporate banking prospects 200 Inheritance measures115 support results Aggressively promoting JiMOCA, waku waku Smart 4 95 FY12 FY13 FY14 FY15 FY16 Insurance for both 267 individual and ・On April 25, 2017, began offering corporate customers ・In June 2016, launched the JiMOCA (Policies) 26 waku waku Smart card loans that do hybrid ATM card and credit card 3 42 not require a visit to a bank branch Testamentary trust 28 ・No. of new members at end of March ・441 applications as of end-May, and estate liquidation 31, 2017: 7,337 (Projects) FY2014 highest loan amount was ¥155 million 0.7 FY2015 FY2016 based on applications 2 0.8 Investment trust and intermediaries (\ billion) 0.9

0.4 Loan creation (\ billion) 1 1.1 0.3

－ 25 － Individual Strategies Based on Basic Strategy I (2) Strengthen corporate solution banking (a)

Strengthen business feasibility studies Expand funding supply methods capabilities ◆Began offering Yamanashi Chuo Bank Regional Revitalization Privately Placed Bonds ◆Strengthen the Head Office support approach → Began offering privately placed bonds with → Strengthen support for business feasibility studies by adding 10 field-specific donation options where a portion of the fees management support staff to the Corporate Solutions Office who have advanced from privately placed bond issuances are specialized knowledge of various industries based on past experience of being donated in the form of educational supplies assigned to external companies. to local schools, in order to help raise funds for companies that contribute to regional 【Field-Specific Management Support Staff】 【Solution Staff】 revitalization and to assist with efforts to 11 staff (all 11 have experience of being 18 staff (of which 9 have experience of give back to the community. assigned to an external company) being assigned to an external company) 【Offerings of privately placed bonds for ◆Manufacturing ◆Business startups, secondary regional revitalization】 ◆Tourism startups ・5 offerings: ¥710 million ◆Wholesale, retail, services ◆Asset inheritance (Jan. 2017 ~ Mar. 2017) ◆Medical, healthcare ◆M&As ◆Local industry (wine) ◆Subsidies ◆Local industry (knit and woven ◆Overseas business development goods) ◆Intellectual property ◆Local industry (other) ◆Business matching Strengthen supportive initiatives for ◆Agriculture, forestry and ◆Sales channel development startup and establishment phase fisheries ◆Systems installation ◆Construction ◆Production management ◆Real estate ◆Personnel and labor management ◆Created an Establishment and New Business Support Desk ◆Environment ◆Risk management → Created Startup and New Business ◆Insurance solutions Support Desk in the Corporate Sales ◆ Financial management Promotion Division to enhance support ◆Effective real estate use for customers starting new businesses → Offered consultations on various matters ◆ Creation and amendment of forms related to business feasibility and constant hands-on support for studies growing the business after startup → Creation of discussion sheets as tools for engaging with customers and talking about management issues that arise from business 【No. of business startup-related feasibility studies. financing deals】 → Modification of business model diagrams to better understand ・112 deals: ¥2,580 million customers’ business models (commercial channels, etc.), and (Fiscal 2016) company-specific solutions sheets to determine solutions policy and manage progress on solution proposals.

－ 26 － Individual Strategies Based on Basic Strategy I (2) Strengthen corporate solution banking (b)~ Circumstances of various funds

Yamanashi New Business Support Yamanashi Chugin Regional Revitalization Investment Limited Partnership Investment Limited Business Partnership

Investment target: Companies in the prefecture that are in the start-up phase or early stage, and Investment target: Companies at various life stages from the startup and establishment phase to the companies engaged in new businesses such as a second start-up. growth and maturity phase. Investments will also target salvageable companies in need of business Goal: Aiming to revitalize the Yamanashi Prefecture economy by the creation of new industries, reorganization or revitalization, as well as those already in liquidation or bankruptcy proceedings. increases in employment and the gross output within the Prefecture, etc. Goal: Aiming to underscore regional revitalization, including by enhancing regional industrial capabilities Total investment: ¥319 million and maintaining or expanding employment in the region by means of nurturing companies that will play Period: August 26, 2014 - December 31, 2023 (10 years) a role in the future of the region. Investors: Yamanashi Prefecture, the Kofu Chamber of Commerce and Industry, the Fujiyoshida Total investment: ¥500 million Chamber of Commerce and Industry, Co., Ltd., Yamanashi Chuo Bank, Yamanashi Chugin Period: March 29, 2016 - December 31, 2025 (10 years) Management Consulting Co., Ltd ◆Investor: Yamanashi Chuo Bank, Yamanashi Chugin Management Consulting Co., Ltd. ◆Results, etc.: ◆Results, etc.: No. of No. of Investment amount Investment amount projects projects

Accumulated (Results) (Results) Accumulated (Results) (Results) investment amount 4 ¥109,700,000 investment amount 4 ¥124,096,000

Projects currently (Forecast) Projects currently (Forecast) under consideration *12 *20 2 projects/¥40,000,000 under consideration 6 projects/¥103,000,000 *Includes projects under consideration by multiple funds *Includes projects under consideration by multiple funds Yamanashi Sixth Industrialization Support Investment Limited Partnership

Investment target: Businesses that are joint ventures with agriculture, forestry and fisheries operators, and operators of other industries (sixth industrialization enterprises) Goal: Aiming to promote the revitalization of agricultural, mountain and fishery villages by becoming a growth industry that creates employment opportunities in these villages, by means of agriculture, forestry and fisheries businesses in the Prefecture engaging in the construction of value chains and the utilization of regional resources. Total investment: ¥500 million Period: March 31, 2015 - December 31, 2029 (15 years) Investors: Agriculture, Forestry and Fisheries Fund Corporation, Yamanashi Chuo Bank, Yamanashi Chugin Management Consulting Co., Ltd. ◆Results, etc.: No. of Investment amount projects

Accumulated (Results) (Results) investment amount 0 0

Projects currently (Forecast) *2 under consideration 2 projects/¥55,000,000

*Includes projects under consideration by multiple funds － 27 － Individual Strategies Based on Basic Strategy I (3) Strengthen coordination with industrial, government, and academic funds (a)

Help advance comprehensive regional strategies Help revitalize agriculture and food industries

・Utilize and engage with Yamanashi Bank’s network and knowledge ◆Yamanashi Food Business Liaison Conference Membership organization that provides information and interaction ・Support the promotion of comprehensive strategy measures of 28 local opportunities for food-related business operators iiauthorities in the Prefecture by accurately engaging with local Held 25 times since 2006. 342 members (as of Mar. 31, 2017). iicharacteristics ◆Agri-Business School New agri-business school with managerial and entrepreneurial spirit that Cooperate and coordinate has been aiming to train managers to promote the sixth industrialization with local authorities from FY2011. Started FY2016 as a specific foundation support project in the Establishment ・Sign partnership agreement Support Business Plan based on the Act on Strengthening Industrial to revitalize regional economy Competitiveness formulated by each municipality in the Prefecture and Results certified by the country. FY2015: Hokuto City FY2016 results: 54 trainees, fair held 14 times FY2016: Uenohara City ◆Yamanashi Food Sector Business Matching Fair FY2017: Tsuru City An exhibition and business fair to support the development and expansion Support for building of sales channels by providing agricultural- and food-related business operators with opportunities to hold business meetings with corporate buyers communities held on Thursday, July 21, 2016, having been held 11 times since 2006 (4 times in ・Operational support of Tsuru City CCRC Tokyo). concept study group 2016 year results: 65 exhibitors, 1,000 visitors, and 2,300 business meetings ・Participate in Yamanashi Prefecture 's– ◆Yamanashi Food Online Trade Fair “"”Yamanashi: Towns of Lifetime Activities” The Bank helps with online food exhibition and sales events sponsored by Gohan study group Standard Inc. to assist with the development and expansion of overseas sales channels ・Collaboration between Kofu City’s central for local agriculture and food-related businesses. shopping area point card and our local First event held during April 10-20, 2017 credit card JiMOCA 15 companies exhibited their goods to a total of 40,000 site visitors Promotional support Balance of loans to agricultural field of moving (¥ million) ・Housing loans in collaboration with 2,000 local authorities 1,967 FY2015 1,558 1,577 1,609 Hokuto City, Fujiyoshida City 1,400 1,380 FY2016 1,225 Fujikawaguchiko Town, Ichikawamisato Town 1,000 Uenohara City, Minami-Alps City, Minobu Town, Nirasaki City, Nanbu Town FY2017 Fujikawa Town, Dousi Village, Tsuru City － 28 － 0 FY10 FY11 FY12 FY13 FY14 FY15 FY16 Individual Strategies Based on Basic Strategy I (3) Strengthen coordination with industrial government, and academic funds (b)

Help revitalize the tourism industry Conducted the Export Project

Results as of FY16 The elimination of tariffs due to TPP coming into effect was considered as an opportunity to sell regional and industrial products with brand power and technological capabilities to overseas markets, and "export projects" were ①Cooperated with the Kyoutou Wine Resort Concept, created by Yamanashi developed from April 2016, thereby supporting customers at the stage of Prefecture, three cities in Kyoutou, and related organizations, to raise overseas development. interest in developing a wine resort area. Participated in the Kyoutou Area Wine Resort Promotion and Finance Conference, established collaboratively by regional financial institutions in the prefecture, and held Results as of FY2016 wine seminars for managers and employees of financial institutions. (124 participants) ② Invited tourism advisors and did consulting services to business operators ①Provided overseas-company matching services, and various aiming to expand business financial services through overseas-partner financial institutions, to ⇒ Tourism advisor Mr. Matsui did consulting 17 times for 14 clients. customers based on their stage of overseas business development. ③ Broadly disseminate sightseeing-related information through outside- prefecture store networks and SNS, and through tourism/product fairs, etc. ②Proposed advantageous terms, such as opening up sales channels, in Tokyo to customers who already conduct trade transactions at other banks. ⇒ Information disseminated on Facebook: 77 times, through 【Results】 tourism/product fairs in 2 companies (in-house) in Tokyo. Trade volume: US$424,819,000 (+33.27% YoY) ④ Implemented the Yamanashi Tourism Fair as a special project of the * New record high, beating US$361,550,000 record set in fiscal year Yamanashi Food Sector Business Matching Fair ending March 1996 - ⇒ Ten group exhibitors (65 companies and groups for the entire matching fair) 424 purchasing companies, 632 people (+51 companies and +39 people compared with the previous year) ⑤ Implemented businesses of the Katakoto English Project to support Trade volume tourism-related business operators in the acceptance of foreign tourists ⇒ Applications received from 45 Prefectural restaurants, etc., and support (US$1,000) provided for 37. 500,000 424,819 400,000 360,017 351,980 ≪Topics≫ 308,457 318,763 271,267 As a local organizer, joined the Japan Inbound Federation, which 300,000 232,483 was established to provide information to tourist-related companies 200,000 about welcoming inbound tourists and nurturing a welcoming mindset. 100,000 Aim to promote tourism by welcoming foreign tourists across 0 Yamanashi through public-private partnerships. FY10 FY11 FY12 FY13 FY14 FY15 FY16

－ 29 － Individual Strategies Based on Basic Strategy I (3) Strengthen coordination with industrial, government, and academic funds (c)

Public Interest Incorporated Foundation, Strengthen coordination with academia Yamanashi Chugin Regional Revitalization Fund ◆Comprehensive business collaboration with universities - The University of Yamanashi, Yamanashi Prefectural University, Yamanashi In December 2015, a general incorporated foundation was established in Gakuin University, and Yamanashi Gakuin Junior College have concluded an order to contribute to the prosperity of the local community and the revitalization agreement on comprehensive business collaboration to the Bank respectively . of the regional economy through subsidies to organizations and individuals who - Two introductory reports issued about the universities’ research: A Direct conduct initiatives that contribute to regional creation. In March 2016, it was Approach to the University of Yamanashi’s Business Opportunities!, and recognized as being in the public interest and transitioned to a public interest Yamanashi Gakuin University’s Management Navigation. - One staff member was dispatched to the University of Yamanashi from July incorporated foundation. 2016, and this person worked as a Regional Collaboration Coordinator to match The fund provided assistance 56 times in fiscal 2016. the technological seeds owned by the university with corporate needs, etc., thereby revitalizing the regional economy, and developing initiatives to promote First financial the region. institution Established the foundation for the purpose of regional revitalization, and received public interest accreditation

No. of Grant No. of Type of grant and target grant amount grants requests (¥ million)

Startup Corporate and 42 5 10 and individual establis 1st half Support hment 51 10 ◆An associate social coordinator of the University of Yamanashi 2016 phase organization, etc. results Create and discover projects through industry-academia cooperation aimed at For SMEs, etc. with the revitalization of regional economies, such as matching a university's businesses making use of 39 10 20 technological seeds with corporate needs. local industrial resources. As of March 2017, 113 employees were actively engaged after being appointed Startup Corporate and by the University of Yamanashi as University of Yamanashi Society Collaboration 76 4 8 and individual Coordinators. establis Support ◆Promote universities and other centers of the community (COC) hment 5 1 9 2nd half phase organization, etc. Yamanashi Chuo is participating in both initiatives of the University of 2016 Yamanashi and of the Yamanashi Prefectural University to work with key upgrade Individuals selecting UIJ-turn results 42 29 6 businesses and other centers of the community (COC) to conduct regional system revitalization projects, and a similar initiative through collaboration with 12 Individuals working to improve universities inside and outside the Prefecture who have made the University of 13 6 10 Yamanashi the university in charge (COC+). technology, etc. Various measures were actively implemented in order to solve regional issues Total ─ 222 56 73 and so forth, by making use of such university assets as knowledge and students. － 30 － Individual Strategies Based on Basic Strategy Ⅱ Optimal distribution of management resources, Advanced IT utilization,Fundamental operational reforms

Optimal distribution of management resources

Optimize the branch banking channels and personnel assignments, and strengthen the banking approach Branches Head Office

○Streamline the Bank to generate more ○Bolster Head Office staff for branch staff supporting branch banking Rotate branch staff ○Redistribute management resources operations to growth regions ○Reengineer the branch banking and mission-specific door-to-door banking approach Head Office Head Office Reorganize Redistribute staff Develop and banking banking support staff support staff branches to growth regions enhance branches Banking Banking staff staff Other Head Other Head Implement Continue to Development of Office staff Office staff measures with increase number sales structure Clerical Clerical emphasis on to West Tokyo based on flexible staff staff efficiency area business hours

Advance IT utilization Fundamentally reform operations

Enhancement of channels according to changes Generate more banking activity man-hours and staff in bank contacts sought by customers ・ Expansion of functions for Internet banking for individuals ・Strengthen sales force by shifting approximately 140 clerical staff ・Establishment of Internet branch (July, 2017) to the sales department during the current medium-term management plan ・Began to study the joint creation of a financial service platform using blockchain technology with other banks in Iwate, Aomori and Akita

Achieve consistent sales posture on all channels （ Omni Channel Sales ） Implement BPR of branch operations Centralize Head Office supervision ・ Investigation and consideration in introducing ATM sales function Computerize and systematize ・Distribution of new EBM information Simplify and standardize Reduce paperwork － 31 － Western Tokyo Bloc Strategy (1)Status of Expansion of Branches and Other Offices in the Western Tokyo Bloc

Office Network Expansion ・Since launch of Hachioji Branch in 1968, the Bank has launched 15 branches in the Western Tokyo Bloc ・Loan Square, mortgage professional offices expand to the current 4 offices

● Higashimurayama Branch Operations commenced and established Loan Square ● Hamura Branch Higashimurayama in Aug. 2015 ● Kichijoji Branch Operations commenced Operations commenced in ● Tokyo Branch in June. 2008 June. 1976 Operations commenced in June. 1877 Moved to current site in June. 1978 as Daiju National Bank Tokyo Branch ● Tachikawa Branch Moved to current site in July. 1916 Operations commenced in Oct. 1974 ● Kokubunji Branch ● Koganei Branch Moved to current site and established Loan Operations commenced in Operations commenced in ● Shinjuku Branch Square Tachikawa in Aug. 2004 Nov. 1977 Dec. 1972 Operations commenced in Mar. 1965 Moved to current site in June. 1998 ● Hachioji Branch Tokyo Operations commenced in Mar. 1968 Hamura Established Loan Square Hachioji in Higashimurayama Sept. 2001 Nishi- Completed new branch as core base in kokubunji Kichijoji Ogikubo Western Tokyo Bloc in Aug. 2014 Nishi- hachioji Hino Tachikawa Fuchu Musashi- Shinjuku Kanda Hachioji koganei Takao Kokuryo Yamanashi Nakagawara Mejirodai Hirayama Chofu ● Ogikubo Branch ● Mejirodai Branch Hachioji- Joshi Koen Operations commenced in Operations commenced in Oct. 1970 Minamino ● Fuchu Branch Oct. 1975 Sagamihara Operations commenced Hashimoto in June. 2007 ● Minamino City Branch ● Chofu Branch Operations commenced in Mar. Kanagawa Operations commenced in 1997 June. 1973 Moved to current site in Nov. 2003 ● Machida Machida Branch ● Hino Branch ● Sagamihara Branch Operations commenced Operations commenced in Apr. 1977 Operations commenced in May 2012 in Mar. 2006 Established Loan Square Sagamihara in Sept. 2013

－ 32 － Western Tokyo Bloc Strategy (2) Western Tokyo Bloc Strategy / Change in actual results A 30 400 Realization of profitability and efficiency Expansion of sales base exceeding Yamanashi prefecture from "point" to "line / face" Number of loans and outstandings300 342 Balance of Loans (term-end) in the medical and nursing care fields 20 (Number of loans) 220（¥ billion） （ ） 297 212.4 ¥ billion Over 200 billion yen Number of business loans 265 Term-end 200 balance 223 200 （¥ billion) 183 186.8 10 100 24.6 180 17.8 172.5 15.2 12.6 167.1 168.7 9.8 Term-end balance 0 0 （¥ billion ) 160 FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16

Balance of Loans to SMEs (term-end) Market size of Western Tokyo area 120 115.0 （¥ billion） ■ Number of private business establishments More than 50% of total loans 110 170 thousand (about 3.9 times of the Yamanashi prefecture) Term-end 100 balance ■ Population （¥ billion) 94.0 5.53 million 90 (about 6.7 times of the Yamanashi prefecture) 81.6 ■ Number of households 77.8 80 76.8 2.55 million households (about 7.6 times of the Yamanashi prefecture) 70 ※ Western Tokyo area, includes the subarban cities, Nishitama-gun, Suginami ward, and Sagamihara-shi FY12 FY13 FY14 FY15 FY16 (source： As of 2016”Economic Census”, as of Apr. 2017 “Estimated population”） －－3333 － Western Tokyo Bloc Strategy (2) Western Tokyo Bloc Strategy / Change in actual results B

Loan (average balance) and Number of Commercial Borrowers

(¥ billion) 2,078 120 Business loans 114.1 103.9 Individual loans 1,872 2,000 100 95.7 94.2 88.6 89.0 93.3 85.4 86.4 83.5 88.1 79.2 83.9 82.8 80.4 80 79.3 80.3 80.9 79.0 76.8 76.9 79.2 76.8 78.4 72.3 72.5 1,768 60 1,659 1,665 1,590 1,500 1,532 40 1,493 1,436 Commercial 1,378 1,140 borrowers 20 1,298 1,203 0 1,000 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16

5.0 Individual220 deposit balance (term-end) Investment trust and life insurance sales amounts (¥ billion) (¥ billion)

Life insurance 203.8 Investment trust 3.1 2.2 200 194.1 1.4 192.2 2.5 1.6 189.2 1.1 1.9 183.9 178.4 180 2.1 2.1 1.8 1.8 1.9 1.5 － 34 － 0.0 160 FY11 FY12 FY13 FY14 FY15 FY16 FY11 FY12 FY13 FY14 FY15 FY16 Thank you for attending our analyst meeting. If you have any further questions, please do not hesitate to contact us at the following telephone number, email address or website.

Inquiries: Corporate Communications CSR Office Corporate Planning Division The Yamanashi Chuo Bank, Ltd. Tel: +81-55-233-2111 E‐mail [email protected] URL: https://www.yamanashibank.co.jp/

The reader is advised that these materials contain forward-looking statements. These statements do not constitute guarantees of future business performance, and they involve various risks and unforeseeable future circumstances. The Bank’s future business performance may be affected by changes in the business environment that are beyond the prediction or control of the Bank, and actual results may therefore differ substantially from the figures contained in the said forward-looking statements.