SEVEN BANK, LTD. Integrated Report For the year ended March 31, 2019 https://www.sevenbank.co.jp/english/ir/ Copyright © 2019 Seven Bank, Ltd. All rights reserved Seven Bank continues to “cultivate.” “If there was an ATM at Seven-Eleven, it would be more convenient …” In response to such comments from customers, Seven Bank was established and has created ATM services that can be accessed “anytime, anywhere, by anyone, and with safety and security.” Currently, due to the spread of smartphones, diversification of payment methods, changes in lifestyles and other factors, our business environment is undergoing radical change. It is hard to predict what kind of future awaits us in years or decades to come. We aim to respond flexibly to such changes in society and diversifying customer needs by continuing to change with the times. We will continue to provide new kinds of convenience that society requires, for use by anyone, with safety and security. Together with the times Together with you 1 2 By addressing five “material issues,” close to people’s lives we will grow together with society. ForFor a safe,safe, secure For new value inin SoSo that everyoneeveryone can live ToTo create a societysociety ToTo live with mutual societysociety … dailydaily liveslives … fairlyfairly and eequallyqually … thatthat considersconsiders the acceptanceacceptance of environmentenvironment … otherother culturescultures … Five “material issues” 1 2 3 4 5 Offer a safe, Create a Create a society Reduce the Realize secure settlement lifestyle through where everyone environmental multicultural SDGs new financial The UN Sustainable Development Summit was infrastructure can be active burden symbiosis held at the headquarters of the United Nations in services September 2015. At the summit, 193 participating countries unanimously adopted a resolution titled “Transforming our world: the 2030 Agenda for Sustainable Development,” which included a set of Sustainable Development Goals (SDGs). The 17 SDGs have 169 specific targets, and companies are expected to take part in the goals and contribute to their achievement by 2030. P. 19 --P. 21 P. 55 -P. 63 - P. 23 - 3 4 Keeping up with the times, together with you, and cultivating new value. May December March 2018– 2018 2017– ATM Receipt (cash receipt service) Expanding n Offering financial io smartphone ATM services Innovat service infrastructure for non-Japanese customers 1HZVW\OHVRI$70XVDJH More than 150 companies in addition to the above Working with new partners to use changes in the Expansion Strengthening operating environment as IE tie-ups with J ğHOGV RIERRIE business opportunities to ([SDQGLQJğHOGVRIEXVLQHVVGLQJ investment targets incorporate the benefits of and partner companies October technological innovation 2018– Expanding August electronic money Tie-ups with 2017– topping-up capabilities January new settlement 2019 business operators Strengthening security to prevent money laundering, etc. *Some partner logos for services are included but not all partners’ or contracted companies’ logos (as of July 11, 2019). 5 6 Contents Corporate Principles Values/Business Model Financial Section 1. We aim to be a sincere company that Seven Bank’s History ·····························································10 Management’s Discussion and Analysis ·······························80 our customers trust. Value Creation ··············································································17 Status of the Corporate Group ··················································85 2. We aim to be a sincere company that Social Changes Seen by Seven Bank and Ways to Management Policy, etc. ···························································86 our business partners, shareholders, Resolve Issues ·············································································19 Consolidated Financial Statements ········································87 and local communities trust. Seven Bank’s Major Performance Indicators ·······················25 Company Information ································································125 3. We aim to be a sincere company that History ··························································································127 our employees trust. Strategy Principal Data ·············································································129 Message from the President ····················································28 In Response to the Shift Toward Cashless Payments ········33 Management Policy Utilizing Expertise in Security Measures Developed to Date ···························································35 1. We aspire to be a trusted fi nancial service provider that fully meets Promoting Innovation—Initiatives at Seven Labo ························37 customer needs. Value Co-Creation that Meets Customers’ Needs 2. We act to promptly introduce the benefi ts of technical innovation and ATM Functions that Anyone Can Use pursue self-development. with Peace of Mind ·····································································40 Convenient Bank Account Just Like a “Wallet” ··················43 3. We strive to contribute to the stability and advancement of the fi nancial Overseas ATM Development ····················································45 system by providing a secure and Offering a User Environment Where Safety and Security Are Maximized ····························································47 effi cient payment infrastructure. Measures to Prevent Financial Crime ····································49 Charter of Ethics (abridged) Sustainability/Governance 1. Be fully aware of the public nature and [Sustainability] social responsibilities of a bank. Our Approach to Sustainability ················································51 2. Provide highly convenient, customer- Seven Bank’s Views on CSR ····················································52 focused services, matched to current Developing Human Resources to Support needs. Sustainable Growth ····································································55 3. Act with integrity and fairness. Creating Safe Workplaces Where Diverse Human Resources Can Work ···················································57 4. Communicate with society. For the Development of Local Communities ························59 5. Have respect for humanity. Collaboration with Partner Companies ··································61 Activities to Combat Climate Change ·····································63 [Governance] Corporate Governance ·······························································65 Seven Bank Management Team ··············································71 Risk Management Initiatives ····················································73 Compliance Initiatives ································································76 This report has been created to provide shareholders, investors and other stakeholders with non-fi nancial information on issues including the environment, society and corporate governance, integrated with fi nancial information, to describe how we create corporate value in an easy-to-understand format. The report has been About this publication prepared referencing the International Integrated Reporting Council’s (“IIRC”) “International Integrated Reporting This integrated report includes information related to Seven Bank’s management policy, business performance, business overview, corporate social Framework,” published in December 2013, and the Ministry of Economy, Trade and Industry’s “Guidance for responsibility (CSR) and fi nancial position. It has also been prepared to include comprehensive non-fi nancial information that supports our sustainable growth. Integrated Corporate Disclosure and Company-Investor Dialogues for Collaborative Value Creation,” Forward-Looking Statements: This document contains statements concerning the current plans, expectations, strategies and beliefs of Seven Bank, Ltd. (“Seven Bank”). Statements contained herein announced on May 29, 2017. that relate to future operating performance and that are not historical facts are forward-looking statements. Forward-looking statements may include, but are not limited to, words such as “believe,” “anticipate,” “plan,” “strategy,” “expect,” “forecast,” “predict,” “potential,” “possibility” and similar words that describe future operating activities, business performance, events or conditions. Forward-looking statements, whether spoken or written, are based on judgments made by the management of Seven Bank, based on information that is currently available to it. As such, these forward-looking statements are subject to various risks and uncertainties, including, but not limited to, changes in the level of demand for the services offered by Seven Bank, challenges Seven Bank faces in achieving further growth and various other factors. As a result of such risks and uncertainties, the actual business results of Seven Bank may vary substantially from the forecasts expressed or implied in forward-looking statements. Consequently, investors are cautioned not to place undue reliance on forward-looking statements. Seven Bank disclaims any obligation to revise forward-looking statements in light of new information, future events or other fi ndings. The information contained in this document does not constitute or form part of any offer for sale or subscription of or solicitation or invitation of any offer to buy or subscribe for any securities, nor shall it or any part of it form the basis of