Interim report
Page 1
Summary of the Financial Statements for the First Six Months of FY2025 [JGAAP] (Consolidated) November 13, 20 25 Company name Aozora Bank, Ltd. TSE code 8304 URL https://www.aozorabank.co.jp/ Representative Hideto Oomi, President and CEO Contact person Yukie Tajima, Joint General Manager of Financial Control Division Scheduled filing date of securities report November 27, 2025 Dividend payable date December 15, 2025 Reference material Affirmative Trading accounts Affirmative Investor meeting Affirmative TEL (03)6752-1111 Listed exchange Tokyo Stock Exchange (Unit: JPY millions, rounded down) 1. Business highlights for the first six months of FY2025 (1) Consolidated business results (Note: Percentages show year-on-year rates of change) Six months ended Millions of yen % Millions of yen % Millions of yen % September 30, 2025 117,144 1.8 15,380 53.9 13,613 14.2 September 30, 2024 115,128 (15.1) 9,994 (30.5) 11,919 (1.1) Ordinary income Ordinary profit Profit attributable to owners of parent (Note) Comprehensive income JPY 19,624 million 14.6 % (Six months ended September 30, 2025) JPY 17,123 million － % (Six months ended September 30, 2024) Net income per common share (basic) Net income per common share (diluted) Six months ended Yen Yen September 30, 2025 98.37 98.20 September 30, 2024 93.37 93.21 (2) Consolidated financial condition Total assets Total net assets Net assets to total assets ratio Net assets per common share Millions of yen Millions of yen % Yen September 30, 2025 8,165,591 473,322 5.7 3,355.19 March 31, 2025 7,762,434 459,685 5.8 3,258.51 (Reference) Total net assets (less Share acquisition rights and Non-controlling interests) JPY 464,295 million (September 30, 2025) JPY 450,916 million (March 31, 2025) (Note) Net assets to total assets ratio = (Total net assets - Share acquisition rights - Non-controlling interests) / Total assets The above Net assets to total assets ratio is different from the capital adequacy ratio prescribed in the notification of the Financial Services Agency. 2. Dividend Yen Yen Yen Yen Yen FY2024 (common share) FY2025 (common share) FY2025 (common share) (Forecast) 3Q end 19.00 19.00 2Q end Year-end 79.0019.00 88.00 22.00 22.00 Annual dividend 1Q end Annual - - 22.00 (Note) Revision of dividends forecast to the latest announcement None Aozora will continue to pay dividends on a quarterly basis, although dividend payment forecast was announced only on an annual basis.
Page 2
3. Consolidated earnings forecast for the year ending March 31, 2026 (FY2025) (Note: Percentages show year-on-year rates of change) Millions of yen % Millions of yen % Yen FY2025 (Full Year) 30,000 70.8 22,000 7.2 Ordinary profit Profit attributable to owners of parent Net income per common share 158.98 (Note) Revision of consolidated earnings forecast to the latest announcement None *Notes (1) Significant changes in the scope of consolidation during the first six months None (2) Changes in accounting policy, accounting estimates, or retrospective restatements (a) Changes with revisions of accounting standards None (b) Changes other than (a) above None (c) Changes in accounting estimates None (d) Retrospective restatements None (3) The number of common shares issued September 30, 2025 March 31, 2025 (a) The number of common shares issued ( including treasury shares ) 139,789,418 139,789,418 (b) The number of treasury shares 1,408,278 1,408,328 Six months ended September 30, 2025 Six months ended September 30, 2024 (c) The average number of common shares outstanding ( 6 months ) 138,381,097 127,660,419 (Summary of non-consolidated financial statements) Business highlights for the first six months of FY2025 (1) Business results (Note: Percentages show year-on-year rates of change) Six months ended Millions of yen % Millions of yen % Millions of yen % September 30, 2025 102,604 (0.2) 14,276 75.2 12,917 67.6 September 30, 2024 102,804 (17.4) 8,147 (28.5) 7,708 (9.4) Ordinary income Ordinary profit Profit Net income per common share (basic) Six months ended Yen September 30, 2025 93.34 September 30, 2024 60.38
Page 3
(2) Financial condition Total assets Total net assets Net assets to total assets ratio Net assets per common share Millions of yen Millions of yen % Yen September 30, 2025 6,988,970 423,504 6.1 3,055.88 March 31, 2025 6,779,341 406,726 6.0 2,935.55 (Reference) Total net assets (less Share acquisition rights): JPY 422,877 million (September 30, 2025) JPY 406,225 million (March 31, 2025) (Note) Net assets to total assets ratio = (Total net assets - Share acquisition rights) / Total assets The above Net assets to total assets ratio is different from the capital adequacy ratio prescribed in the notification of the Financial Services Agency. ※Summary of the Financial Statements for the First Six Months is out of scope of interim audit (by CPAs or audit firms) . ※Notes and remarks for the proper use of earnings projection The above earnings forecast involves certain risks and uncertainties since the calculations are based on management’s assumptions and beliefs in light of information currently available. This should not be interpreted as a promise or guarantee that the forecast will be achieved. Please be aware that actual results may be materially different from the forecast presented herein due to various factors.
Page 4
[ Attachment ] 1. Overview of operating results ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 2. Interim consolidated financial statements and main notes・・・・・・・・・・・・・・・・・・ (1) Interim consolidated balance sheet・・・・・・・・・・・・・・・・・・・・・・・・・・ (2) Interim consolidated statement of income and Interim consolidated statement of comprehensive income・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ Interim consolidated statement of income・・・・・・・・・・・・・・・・・・・・・・・・ Interim consolidated statement of comprehensive income・・・・・・・・・・・・・・・・・ (3) Interim consolidated statement of changes in net assets・・・・・・・・・・・・・・・・・ (4) Notes to interim consolidated financial statements・・・・・・・・・・・・・・・・・・・・ (Information on going concern assumption)・・・・・・・・・・・・・・・・・・・・・・・ (Additional information)・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 3. Interim non-consolidated financial statements・・・・・・・・・・・・・・・・・・・・・・・・ (1) Interim non-consolidated balance sheet・・・・・・・・・・・・・・・・・・・・・・・・ (2) Interim non-consolidated statement of income・・・・・・・・・・・・・・・・・・・・・・ (3) Interim non-consolidated statement of changes in net assets・・・・・・・・・・・・・・・ 2 3 3 4 4 4 5 7 7 7 8 8 10 11 Aozora Bank, Ltd. 1
Page 5
1. Overview of operating results For more details, please refer to ‘FY2025 Interim Financial Results and Progress on the Mid-term Plan’ that was announced today (November 13, 2025) on TDnet or the Bank’s website (https://www.aozorabank.co.jp/english/ir/library/results/). Aozora Bank, Ltd. 2
Page 6
2. Interim consolidated financial statements and main notes (1) Interim consolidated balance sheet (Millions of yen) As of March 31, 2025 As of September 30, 2025 Assets Cash and due from banks 1,409,371 1,710,799 Call loans and bills bought 31,782 70,872 Monetary claims bought 58,530 53,275 Trading account assets 262,803 295,925 Money held in trust 12,728 8,844 Securities 1,355,458 1,401,835 Loans and bills discounted 4,206,564 4,163,123 Foreign exchanges 46,420 42,269 Other assets 331,054 360,243 Tangible fixed assets 22,385 21,890 Intangible fixed assets 19,075 18,459 Retirement benefit asset 9,430 9,611 Deferred tax assets 51,583 49,706 Customers' liabilities for acceptances and guarantees 18,711 18,450 Allowance for loan losses (71,025) (57,326) Allowance for investment loss (2,439) (2,389) Total assets 7,762,434 8,165,591 Liabilities Deposits 5,598,301 5,849,583 Negotiable certificates of deposit 74,600 49,200 Call money and bills sold 5,000 71,466 Securities sold under repurchase agreements 27,924 36,261 Cash collateral received for securities lent 345,719 351,988 Trading account liabilities 209,155 272,839 Borrowed money 726,300 740,100 Bonds payable 124,640 124,199 Other liabilities 155,993 163,712 Provision for bonuses 4,756 2,965 Provision for bonuses for directors (and other officers) 67 35 Retirement benefit liability 10,353 10,203 Provision for credit losses on off-balance-sheet instruments 1,218 1,254 Reserves under special laws 8 8 Acceptances and guarantees 18,711 18,450 Total liabilities 7,302,748 7,692,269 Net assets Share capital 125,966 125,966 Capital surplus 113,483 113,483 Retained earnings 241,485 249,009 Treasury shares (2,894) (2,894) Total shareholders' equity 478,040 485,565 Valuation difference on available-for-sale securities (39,532) (26,727) Deferred gains or losses on hedges 517 (2,438) Foreign currency translation adjustment 9,604 5,948 Remeasurements of defined benefit plans 2,286 1,947 Total accumulated other comprehensive income (27,123) (21,270) Share acquisition rights 501 626 Non-controlling interests 8,267 8,400 Total net assets 459,685 473,322 Total liabilities and net assets 7,762,434 8,165,591 Aozora Bank, Ltd. 3
Page 7
(2) Interim consolidated statement of income and Interim consolidated statement of comprehensive income (Interim consolidated statement of income) (Millions of yen) Six months ended September 30, 2024 Six months ended September 30, 2025 Ordinary income 115,128 117,144 Interest income 81,728 78,802 Interest on loans and discounts 66,362 59,082 Interest and dividends on securities 10,407 12,793 Trust fees 190 215 Fees and commissions 13,409 19,191 Gain on trading account transactions 1,981 1,922 Other ordinary income 13,139 13,991 Other income 4,679 3,021 Ordinary expenses 105,133 101,764 Interest expenses 56,995 54,484 Interest on deposits 6,282 13,980 Fees and commissions payments 3,177 3,656 Loss on trading account transactions 581 341 Other ordinary expenses 8,242 3,491 General and administrative expenses 30,117 31,653 Other expenses 6,018 8,136 Ordinary profit 9,994 15,380 Extraordinary income 3,408 － Reversal of foreign currency translation adjustment 3,408 － Extraordinary losses 260 6 Loss on disposal of non-current assets － 6 Impairment losses 260 － Profit before income taxes 13,143 15,374 Income taxes - current 691 807 Income taxes - deferred 1,236 822 Total income taxes 1,927 1,629 Profit 11,215 13,744 Profit (loss) attributable to non-controlling interests (704) 130 Profit attributable to owners of parent 11,919 13,613 (Interim consolidated statement of comprehensive income) (Millions of yen) Six months ended September 30, 2024 Six months ended September 30, 2025 Profit 11,215 13,744 Other comprehensive income 5,908 5,879 Valuation difference on available-for-sale securities 12,967 12,831 Deferred gains or losses on hedges (5,826) (2,956) Foreign currency translation adjustment (3,737) 433 Remeasurements of defined benefit plans, net of tax (185) (339) Share of other comprehensive income of entities accounted for using equity method 2,689 (4,089) Comprehensive income 17,123 19,624 Comprehensive income attributable to Comprehensive income attributable to owners of parent 17,836 19,467 Comprehensive income attributable to non-controlling interests (712) 156 Aozora Bank, Ltd. 4
Page 8
(3) Interim consolidated statement of changes in net assets For the six months ended September 30, 2024 (Millions of yen) Shareholders' equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders' equity Balance at beginning of period 100,000 87,498 228,444 (3,015) 412,928 Changes during period Issuance of new shares 25,966 25,966 51,933 Dividends of surplus (2,219) (2,219) Profit attributable to owners of parent 11,919 11,919 Purchase of treasury shares (0) (0) Disposal of treasury shares 18 121 139 Net changes in items other than shareholders' equity Total changes during period 25,966 25,984 9,700 120 61,772 Balance at end of period 125,966 113,483 238,145 (2,894) 474,700 Accumulated other comprehensive income Share acquisition rights Non- controlling interests Total net assets Valuation difference on available- for-sale securities Deferred gains or losses on hedges Foreign currency translation adjustment Remeasurements of defined benefit plans Total accumulated other comprehensive income Balance at beginning of period (45,803) 4,332 10,137 2,277 (29,056) 532 6,673 391,078 Changes during period Issuance of new shares 51,933 Dividends of surplus (2,219) Profit attributable to owners of parent 11,919 Purchase of treasury shares (0) Disposal of treasury shares 139 Net changes in items other than shareholders' equity 12,976 (5,826) (1,047) (185) 5,916 (31) 1,770 7,656 Total changes during period 12,976 (5,826) (1,047) (185) 5,916 (31) 1,770 69,428 Balance at end of period (32,826) (1,494) 9,089 2,091 (23,139) 501 8,444 460,506 Aozora Bank, Ltd. 5
Page 9
For the six months ended September 30, 2025 (Millions of yen) Shareholders' equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders' equity Balance at beginning of period 125,966 113,483 241,485 (2,894) 478,040 Changes during period Dividends of surplus (6,088) (6,088) Profit attributable to owners of parent 13,613 13,613 Disposal of treasury shares 0 0 Net changes in items other than shareholders' equity Total changes during period － － 7,524 0 7,524 Balance at end of period 125,966 113,483 249,009 (2,894) 485,565 Accumulated other comprehensive income Share acquisition rights Non- controlling interests Total net assets Valuation difference on available- for-sale securities Deferred gains or losses on hedges Foreign currency translation adjustment Remeasurements of defined benefit plans Total accumulated other comprehensive income Balance at beginning of period (39,532) 517 9,604 2,286 (27,123) 501 8,267 459,685 Changes during period Dividends of surplus (6,088) Profit attributable to owners of parent 13,613 Disposal of treasury shares 0 Net changes in items other than shareholders' equity 12,805 (2,956) (3,656) (339) 5,853 125 133 6,112 Total changes during period 12,805 (2,956) (3,656) (339) 5,853 125 133 13,637 Balance at end of period (26,727) (2,438) 5,948 1,947 (21,270) 626 8,400 473,322 Aozora Bank, Ltd. 6
Page 10
(4) Notes to interim consolidated financial statements (Information on going concern assumption) None (Additional information) (Allowance for Loan Losses for Overseas Real Estate Non-Recourse Loans) For overseas real estate non-recourse loans, the Bank assumes a decrease in market liquidity mainly due to the deteriorating environment of the U.S. real estate market, and particularly U.S office market are expected to stabilize during the FY2025, considering the market trends. In line with this, for all borrowers of o verseas real estate non -recourse loans that require careful monitoring in the future, the loan loss amount mainly estimated by the DCF method is reflected as an addition to the allowance for loan losses determined based on the estimated loan loss ratio. In addition, for non-recourse loans backed by underperforming office properties in the U.S. due to the changes in working styles in the post-COVID-19 period, in order to prepare for the disposal of these properties, for cases where there is a possibility of debt recovery in the future, the Bank evaluates the property considering the risk of price decline during the FY2025 and determines individual borrower category considering the possibility of the debt recovery through the disposal of propert ies. The allowance for loan losses is made based on the estimated disposal price assuming the price decline risk. The above assumptions, which are the basis for the estimates, have a high degree of uncertainty, and depending on the situation, future profits and losses may fluctuate. Aozora Bank, Ltd. 7
Page 11
3. Interim non-consolidated financial statements (1) Interim non-consolidated balance sheet (Millions of yen) As of March 31, 2025 As of September 30, 2025 Assets Cash and due from banks 879,959 858,358 Call loans 31,782 70,872 Monetary claims bought 31,379 28,559 Trading account assets 262,803 295,925 Money held in trust 5,216 3,400 Securities 1,324,991 1,366,246 Loans and bills discounted 3,852,978 3,930,267 Foreign exchanges 46,420 42,269 Other assets 302,413 341,380 Other 302,413 341,380 Tangible fixed assets 21,278 20,666 Intangible fixed assets 9,004 8,076 Prepaid pension costs 6,651 7,275 Deferred tax assets 52,039 49,493 Customers' liabilities for acceptances and guarantees 24,711 24,450 Allowance for loan losses (69,850) (55,882) Allowance for investment loss (2,439) (2,389) Total assets 6,779,341 6,988,970 Liabilities Deposits 4,681,677 4,742,371 Negotiable certificates of deposit 74,600 49,200 Call money 5,000 71,466 Securities sold under repurchase agreements 27,924 36,261 Cash collateral received for securities lent 345,719 351,988 Trading account liabilities 209,155 272,839 Borrowed money 726,300 740,100 Bonds payable 124,640 124,199 Other liabilities 137,532 139,046 Income taxes payable 1,184 555 Lease liabilities 1,099 963 Asset retirement obligations 2,033 2,137 Other 133,214 135,391 Provision for bonuses 4,018 2,486 Provision for bonuses for directors (and other officers) 67 35 Provision for retirement benefits 10,187 9,907 Provision for credit losses on off-balance-sheet instruments 1,080 1,113 Acceptances and guarantees 24,711 24,450 Total liabilities 6,372,614 6,565,466 Aozora Bank, Ltd. 8
Page 12
(Millions of yen) As of March 31, 2025 As of September 30, 2025 Net assets Share capital 125,966 125,966 Capital surplus 113,483 113,483 Legal capital surplus 113,280 113,280 Other capital surplus 203 203 Retained earnings 208,631 215,459 Legal retained earnings 12,686 12,686 Other retained earnings 195,944 202,772 Retained earnings brought forward 195,944 202,772 Treasury shares (2,894) (2,894) Total shareholders' equity 445,186 452,015 Valuation difference on available-for-sale securities (39,478) (26,699) Deferred gains or losses on hedges 517 (2,438) Total valuation and translation adjustments (38,961) (29,138) Share acquisition rights 501 626 Total net assets 406,726 423,504 Total liabilities and net assets 6,779,341 6,988,970 Aozora Bank, Ltd. 9
Page 13
(2) Interim non-consolidated statement of income (Millions of yen) Six months ended September 30, 2024 Six months ended September 30, 2025 Ordinary income 102,804 102,604 Interest income 77,351 73,988 Interest on loans and discounts 61,905 54,138 Interest and dividends on securities 10,946 14,670 Trust fees 190 215 Fees and commissions 7,822 11,345 Gain on trading account transactions 1,914 1,921 Other ordinary income 12,544 13,430 Other income 2,981 1,703 Ordinary expenses 94,657 88,327 Interest expenses 57,198 53,593 Interest on deposits 6,485 13,088 Fees and commissions payments 968 833 Loss on trading account transactions 581 341 Other ordinary expenses 8,934 4,980 General and administrative expenses 22,246 22,894 Other expenses 4,728 5,683 Ordinary profit 8,147 14,276 Extraordinary losses 260 5 Loss on disposal of non-current assets － 5 Impairment losses 260 － Profit before income taxes 7,886 14,271 Income taxes - current 80 45 Income taxes - deferred 98 1,309 Total income taxes 178 1,354 Profit 7,708 12,917 Aozora Bank, Ltd. 10
Page 14
(3) Interim non-consolidated statement of changes in net assets For the six months ended September 30, 2024 (Millions of yen) Shareholders' equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders' equity Legal capital surplus Other capital surplus Total capital surplus Legal retained earnings Other retained earnings Total retained earnings Retained earnings brought forward Balance at beginning of period 100,000 87,313 185 87,498 12,686 187,724 200,411 (3,015) 384,894 Changes during period Issuance of new shares 25,966 25,966 25,966 51,933 Dividends of surplus (2,219) (2,219) (2,219) Profit 7,708 7,708 7,708 Purchase of treasury shares (0) (0) Disposal of treasury shares 18 18 121 139 Net changes in items other than shareholders' equity Total changes during period 25,966 25,966 18 25,984 － 5,488 5,488 120 57,560 Balance at end of period 125,966 113,280 203 113,483 12,686 193,212 205,899 (2,894) 442,455 Valuation and translation adjustments Share acquisition rights Total net assets Valuation difference on available-for-sale securities Deferred gains or losses on hedges Total valuation and translation adjustments Balance at beginning of period (45,754) 4,332 (41,422) 532 344,004 Changes during period Issuance of new shares 51,933 Dividends of surplus (2,219) Profit 7,708 Purchase of treasury shares (0) Disposal of treasury shares 139 Net changes in items other than shareholders' equity 12,985 (5,826) 7,158 (31) 7,127 Total changes during period 12,985 (5,826) 7,158 (31) 64,688 Balance at end of period (32,769) (1,494) (34,263) 501 408,693 Aozora Bank, Ltd. 11
Page 15
For the six months ended September 30, 2025 (Millions of yen) Shareholders' equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders' equity Legal capital surplus Other capital surplus Total capital surplus Legal retained earnings Other retained earnings Total retained earnings Retained earnings brought forward Balance at beginning of period 125,966 113,280 203 113,483 12,686 195,944 208,631 (2,894) 445,186 Changes during period Dividends of surplus (6,088) (6,088) (6,088) Profit 12,917 12,917 12,917 Disposal of treasury shares 0 0 Net changes in items other than shareholders' equity Total changes during period － － － － － 6,828 6,828 0 6,828 Balance at end of period 125,966 113,280 203 113,483 12,686 202,772 215,459 (2,894) 452,015 Valuation and translation adjustments Share acquisition rights Total net assets Valuation difference on available-for-sale securities Deferred gains or losses on hedges Total valuation and translation adjustments Balance at beginning of period (39,478) 517 (38,961) 501 406,726 Changes during period Dividends of surplus (6,088) Profit 12,917 Disposal of treasury shares 0 Net changes in items other than shareholders' equity 12,779 (2,956) 9,823 125 9,948 Total changes during period 12,779 (2,956) 9,823 125 16,777 Balance at end of period (26,699) (2,438) (29,138) 626 423,504 Aozora Bank, Ltd. 12
Page 16
Financial Results for the First Six Months of FY2025
Page 17
Ⅰ. Overviews of the Financial Results for the Six Months Ended September 30, 2025 1. Summary of Revenue and Expenses 【Consolidated】 １ 【Non-consolidated】 ２ 2. Profit Margins 【Non-consolidated】 ３ 3. Business Profit 【Non-consolidated】 4. ROE 【Non-consolidated】 5. Gains (losses) on Securities Transactions 【Non-consolidated】 6. Investments and Funding 【Consolidated】【Non-consolidated】 ４ 7. Unrealized Gains and Losses on Securities 【Consolidated】【Non-consolidated】 ５ 8. Sales of investment trusts and annuity insurance to retail customers 【Non-consolidated】 9. Employees' Retirement Benefits 【Consolidated】【Non-consolidated】 ６ 10. Capital Adequacy Ratio（under Japanese domestic standards ） 【Consolidated】【Non-consolidated】 ７ Ⅱ. Status of Loans, etc. 1. NPLs based on the Banking Act and the FRA, and coverage 【Consolidated】【Non-consolidated】 ８ 2. Allowance for Loan Losses 【Consolidated】【Non-consolidated】 ９ 3. Coverage for NPLs based on the FRA by Borrowers' Category 【Consolidated】 １０ 4. Off-Balancing of NPLs based on the FRA 【Non-consolidated】 １１ 5. Breakdown of Loans and Bills Discounted Classified by Industry 【Consolidated】 １２ ＊ NPLs : Non-performing loans ＊ FRA : Financial Reconstruction Act Ⅲ. Deferred Tax Assets １３ 【 INDEX 】
Page 18
Aozora Bank, Ltd. Ⅰ． Overviews of the Financial Results for the Six Months Ended September 30, 2025 １．Summary of Revenue and Expenses 【Consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Consolidated net revenue ※1 52,149 10,697 41,451 Net interest income 24,317 (415) 24,733 Net fees and commissions 15,750 5,328 10,422 Net gains on trading account transactions 1,580 181 1,399 Net other ordinary income 10,500 5,603 4,896 General and administrative expenses (32,102) (1,758) (30,344) Gains (losses) on equity method investments 1,015 (195) 1,211 Business profit ※2 21,062 8,744 12,318 Credit-related expenses (6,047) (2,442) (3,605) Write-off of loans (5,537) (5,459) (78) Provision of specific allowance for loan losses (2,231) 1,262 (3,494) Provision of general allowance for loan losses 2,683 3,445 (761) Provision of allowance for loans to restructuring countries - - - Loss on disposition of loans (1,067) (884) (183) Recoveries of written-off receivables 141 53 87 Provision of allowance for credit losses on off-balance-sheet instruments (36) (859) 823 Gains (losses) on stock transactions 535 (1,343) 1,878 Other (169) 427 (597) Ordinary profit 15,380 5,385 9,994 Extraordinary profit (loss) (6) (3,154) 3,148 Profit before income taxes 15,374 2,231 13,143 Income taxes-current (807) (116) (691) Income taxes-deferred (822) 413 (1,236) Profit 13,744 2,528 11,215 (Profit) loss attributable to non-controlling interests (130) (835) 704 Profit attributable to owners of parent 13,613 1,693 11,919 ※2 Business profit = Consolidated net revenue - General and administrative expenses + Gains (losses) on equity method investments (Note) The amounts are rounded down to the nearest million yen. (Scope of Consolidation and Equity-Method Application） (Number of companies) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Consolidated subsidiaries 24 0 24 Subsidiaries and affiliated companies applying equity-method 1 0 1 Consolidated net revenue = (Interest income - Interest expenses) + (Trust fees + Fees and commissions - Fees and commissions payments) + (Gain on trading account transactions - Loss on trading account transactions) + (Other ordinary income - Other ordinary expenses) ※1 - 1 -
Page 19
Aozora Bank, Ltd. 【Non-consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Net revenue 41,162 9,016 32,145 (Excluding gains (losses) on bond transactions) 40,448 10,689 29,759 Net interest income 20,406 248 20,158 Net fees and commissions ※1 10,727 3,682 7,045 Net gains on trading account transactions 1,579 247 1,332 Net other ordinary income 8,449 4,838 3,610 (Gains (losses) on bond transactions) 713 (1,672) 2,386 (23,343) (870) (22,473) Personnel (11,805) (294) (11,510) Property and equipment (10,503) (534) (9,968) Taxes (1,034) (40) (993) Business profit before provision of general allowance for loan losses 17,819 8,146 9,672 Core business profit ※2 17,105 9,819 7,285 16,476 9,233 7,242 Credit-related expenses (3,936) (789) (3,146) Write-off of loans (4,362) (4,316) (45) Provision of specific allowance for loan losses (1,998) 1,281 (3,279) Provision of general allowance for loan losses 2,756 3,410 (654) Provision of allowance for loans to restructuring countries - - - Loss on disposition of loans (348) (283) (64) Recoveries of written-off receivables 49 (29) 78 (32) (851) 818 Gains (losses) on stock transactions 535 (1,343) 1,878 Other (141) 116 (257) Ordinary profit 14,276 6,129 8,147 Extraordinary profit (loss) (5) 254 (260) Profit before income taxes 14,271 6,384 7,886 Income taxes-current (45) 35 (80) Income taxes-deferred (1,309) (1,211) (98) Profit 12,917 5,209 7,708 17,786 8,767 9,018 ※1 Trust fees are included. ※2 Core business profit = Business profit before provision of general allowance for loan losses - Gains (losses) on bond transactions (Note) The amounts are rounded down to the nearest million yen. General and administrative expenses Business profit Provision of allowance for credit losses on off-balance-sheet instruments Core business profit excluding cancellation on investment trusts - 2 -
Page 20
Aozora Bank, Ltd. 2. Profit Margins 【Non-consolidated】 (Total) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) （１）Yield on total investments （Ａ） 2.55% (0.24%) 2.79% Yield on loans （Ｂ） 2.82% (0.40%) 3.22% Yield on securities 2.11% 0.42% 1.69% 2.52% (0.04%) 2.56% 1.51% 0.37% 1.14% Yield on deposits & certificates of deposit （Ｅ） 0.55% 0.30% 0.25% Yield on borrowings 0.66% 0.30% 0.36% （３）Profit margins （Ａ）－（Ｃ） 0.03% (0.20%) 0.23% （４）Loan margin （Ｂ）－（Ｄ） 1.31% (0.77%) 2.08% （５）Yield spread （Ｂ）－（Ｅ） 2.27% (0.70%) 2.97% (Note) The figures are calculated in the method specified in 'Kessan Jokyohyo.' (Domestic operations） For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) （１）Yield on total investments （Ａ） 1.12% 0.39% 0.73% Yield on loans （Ｂ） 1.49% 0.38% 1.11% Yield on securities 1.36% 0.49% 0.87% 1.30% 0.33% 0.97% 1.41% 0.37% 1.04% Yield on deposits & certificates of deposit （Ｅ） 0.49% 0.28% 0.21% Yield on borrowings 0.64% 0.28% 0.36% （３）Profit margins （Ａ）－（Ｃ） (0.18%) 0.06% (0.24%) （４）Loan margin （Ｂ）－（Ｄ） 0.08% 0.01% 0.07% （５）Yield spread （Ｂ）－（Ｅ） 1.00% 0.10% 0.90% (Note) The figures are calculated in the method specified in 'Kessan Jokyohyo.' 3. Business Profit 【Non-consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Core net business profit 17,819 8,146 9,672 per employee (thousand yen) 9,100 4,225 4,875 4. ROE 【Non-consolidated】 For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) 8.57% 3.44% 5.13% Profit basis 6.21% 2.12% 4.09% 5. Gains (losses) on Securities Transactions 【Non-consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Gains (losses) on bond transactions 713 (1,672) 2,386 Gain on sale of bonds 1,978 (636) 2,615 Gain on redemption of bonds - - - Loss on sale of bonds (1,137) (944) (192) Loss on redemption of bonds (121) (85) (36) Loss on devaluation of bonds (5) (5) - Gains (losses) on stock transactions 535 (1,343) 1,878 Gain on sale of equity securities 629 (1,249) 1,878 Loss on sale of equity securities (32) (32) - Loss on devaluation of equity securities (60) (60) - Cost of deposits & certificates of deposit （including general and administrative expenses ） （Ｄ） Core net business profit basis ROE= Profit × 365 ÷ number of days elapsed {(Total net assets at beginning of term - Share acquisition rights) + (Total net assets at end of term - Share acquisition rights)} ÷2 （２）Rate of funding cost（including general and administrative expenses） （Ｃ） （２）Rate of funding cost（including general and administrative expenses） （Ｃ） Cost of deposits & certificates of deposit （including general and administrative expenses ） （Ｄ） - 3 -
Page 21
Aozora Bank, Ltd. 6. Investments and Funding 【Consolidated】 (Total) (Millions of yen) Average balance Yield Average balance Yield Average balance Yield Total investments 5,973,277 2.49% 308,003 (0.34%) 5,665,274 2.83% Due from banks 49,283 1.57% (14,957) (0.42%) 64,240 1.99% Call loans and bills bought 37,475 0.65% (7,220) (0.10%) 44,695 0.75% Securities purchased under resale agreements 9 0.46% (0) 0.46% 9 0.00% Cash collateral provided for securities borrowed - - - - - - Securities 1,413,111 1.80% 148,096 0.16% 1,265,014 1.64% Loans and bills discounted 4,160,438 2.83% 137,504 (0.46%) 4,022,934 3.29% Total funding 7,083,729 1.53% 211,809 (0.12%) 6,871,920 1.65% Deposits 5,763,862 0.48% 127,998 0.26% 5,635,863 0.22% Negotiable certificates of deposit 53,152 0.62% (45,284) 0.50% 98,437 0.12% Call money and bills sold 30,492 0.99% 29,171 0.83% 1,320 0.16% Securities sold under repurchase agreements 26,759 4.51% (3,097) (0.96%) 29,856 5.47% Cash collateral received for securities lent 335,750 4.32% 54,194 (0.94%) 281,556 5.26% Borrowed money 733,964 0.64% 116,799 0.28% 617,165 0.36% Bonds payable 122,261 4.81% (55,297) 1.37% 177,558 3.44% 【Non-consolidated】 (Total) (Millions of yen) Average balance Yield Average balance Yield Average balance Yield Total investments 5,607,193 2.55% 141,077 (0.24%) 5,466,115 2.79% Due from banks 15,930 4.27% (5,753) (0.94%) 21,683 5.21% Call loans 37,475 0.65% (5,689) (0.12%) 43,165 0.77% Securities purchased under resale agreements 9 0.46% (0) 0.46% 9 0.00% Cash collateral provided for securities borrowed - - - - - - Securities 1,383,687 2.11% 99,015 0.42% 1,284,672 1.69% Loans and bills discounted 3,882,623 2.78% 8,842 (0.40%) 3,873,780 3.18% Total funding 6,066,795 1.76% (111,978) (0.08%) 6,178,774 1.84% Deposits 4,746,928 0.54% (195,789) 0.28% 4,942,718 0.26% Negotiable certificates of deposit 53,152 0.62% (45,284) 0.50% 98,437 0.12% Call money 30,492 0.99% 29,171 0.83% 1,320 0.16% Securities sold under repurchase agreements 26,759 4.51% (3,097) (0.96%) 29,856 5.47% Cash collateral received for securities lent 335,750 4.32% 54,194 (0.94%) 281,556 5.26% Borrowed money 733,964 0.64% 116,799 0.28% 617,165 0.36% Bonds payable 122,261 4.81% (55,297) 1.37% 177,558 3.44% (Domestic operations) (Millions of yen) Average balance Yield Average balance Yield Average balance Yield Total investments 5,003,748 1.12% 131,424 0.39% 4,872,323 0.73% Due from banks 301 0.46% (88) 0.43% 390 0.03% Call loans 35,535 0.55% (2,060) 0.37% 37,595 0.18% Securities purchased under resale agreements 9 0.46% (0) 0.46% 9 0.00% Cash collateral provided for securities borrowed - - - - - - Securities 457,895 1.36% 41,273 0.49% 416,621 0.87% Loans and bills discounted 2,570,410 1.49% 204,637 0.38% 2,365,772 1.11% Total funding 5,505,182 0.51% (133,818) 0.27% 5,639,001 0.24% Deposits 4,669,490 0.49% (215,686) 0.28% 4,885,176 0.21% Negotiable certificates of deposit 53,152 0.62% (45,284) 0.50% 98,437 0.12% Call money 27,451 0.58% 26,130 0.42% 1,320 0.16% Securities sold under repurchase agreements - - - - - - Cash collateral received for securities lent - - - - - - Borrowed money 733,959 0.64% 116,799 0.28% 617,159 0.36% Bonds payable 20,000 0.39% (8,852) 0.09% 28,852 0.30% For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (B) (A) (A) - (B) (B) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) - (B) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A) - (B) (B) - 4 -
Page 22
Aozora Bank, Ltd. 7. Unrealized Gains and Losses on Securities 【Consolidated】 (Millions of yen) Unrealized gains and losses Unrealized gains and losses (A) (A)-(B) (B) Held-to-maturity bonds - - - - - - - Available-for-sale securities (39,212) 15,386 30,056 69,268 (54,598) 22,874 77,473 Japanese stocks 17,189 4,612 17,391 202 12,576 13,044 468 Japanese debt securities (7,202) (552) 216 7,418 (6,649) 205 6,855 Other (49,199) 11,326 12,448 61,647 (60,525) 9,624 70,149 (Note) 【Non-consolidated】 (Millions of yen) Unrealized gains and losses Unrealized gains and losses (A) (A)-(B) (B) Held-to-maturity bonds - - - - - - - Available-for-sale securities (39,124) 15,343 30,056 69,181 (54,468) 22,871 77,340 Japanese stocks 17,189 4,612 17,391 202 12,576 13,044 468 Japanese debt securities (7,114) (595) 216 7,331 (6,519) 202 6,721 Other (49,199) 11,326 12,448 61,647 (60,525) 9,624 70,149 (Note) 8． Sales of investment trusts and annuity insurance to retail customers 【Non-consolidated】 (Sales Total) (Billions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A)-(B) (B) Investment trusts 45.8 (19.1) 64.9 Annuity insurance 8.2 (1.4) 9.6 September 30, 2025 March 31, 2025 lossesgains gains A portion of beneficial interests in investment trust within 'Monetary claims bought' is included in the table above. losseslosses September 30, 2025 March 31, 2025 losses gains gains A portion of beneficial interests in investment trust within 'Monetary claims bought' is included in the table above. - 5 -
Page 23
Aozora Bank, Ltd. 9. Employees' Retirement Benefits ① Provision for retirement benefits 【Consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 (A) (A) - (B) (B) Defined retirement benefit obligation (A) (34,825) 425 (35,250) Fair value of plan assets (B) 34,232 (94) 34,327 Unfunded retirement benefit obligation (C)=(A)+(B) (592) 330 (922) Retirement benefit asset (D) 9,611 180 9,430 Retirement benefit liability (C)-(D) (10,203) 149 (10,353) Unrecognized actuarial losses (E) 2,843 (495) 3,338 Unrecognized prior-service cost (F) - - - (E)+(F) 2,843 (495) 3,338 【Non-consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 (A) (A) - (B) (B) Defined retirement benefit obligation (A) (34,021) 503 (34,524) Fair value of plan assets (B) 34,232 (94) 34,327 Unfunded retirement benefit obligation (C)=(A)+(B) 211 408 (196) Unrecognized actuarial losses (D) (2,843) 495 (3,338) Unrecognized prior-service cost (E) - - - Net liability recognized (F)=(C)+(D)+(E) (2,631) 903 (3,535) Prepaid pension costs (G) 7,275 623 6,651 Provision for retirement benefits (F)-(G) (9,907) 280 (10,187) ② Net periodic retirement benefit costs 【Consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A) - (B) (B) 89 (145) 235 【Non-consolidated】 (Millions of yen) For the six months ended September 30, 2025 For the six months ended September 30, 2024 (A) (A) - (B) (B) Net periodic retirement benefit costs (11) (161) 149 Service cost 589 (55) 645 Interest cost 323 101 221 Expected return on plan assets (429) 20 (449) Amortization of prior-service cost - - - Recognized actuarial losses (495) (227) (267) Other - - - Remeasurements of defined benefit plans (before income tax effect) Net periodic retirement benefit costs regarding defined benefit pension plans - 6 -
Page 24
Aozora Bank, Ltd. 10. Capital Adequacy Ratio (under Japanese domestic standards) ■Basel Ⅲ 【Consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 preliminary (A) (A) - (B) (A) - (C) (B) (C) (1) Capital adequacy ratio (4)/(5) 10.44% (0.28%) (0.40%) 10.72% 10.84% (2) Core capital: instruments and reserves 530,795 1,058 3,522 529,736 527,273 (3) Core capital: regulatory adjustments 42,995 1,512 2,747 41,483 40,248 (4) Regulatory capital (2)-(3) 487,800 (453) 775 488,253 487,024 (5) Risk-weighted assets 4,672,184 118,370 183,394 4,553,814 4,488,790 (6) Total required capital (5)*4% 186,887 4,734 7,335 182,152 179,551 【Non-consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 preliminary (A) (A) - (B) (A) - (C) (B) (C) (1) Capital adequacy ratio (4)/(5) 9.91% (0.23%) (0.35%) 10.14% 10.26% (2) Core capital: instruments and reserves 484,949 4,232 6,071 480,717 478,878 (3) Core capital: regulatory adjustments 29,186 2,115 3,203 27,070 25,982 (4) Regulatory capital (2)-(3) 455,763 2,116 2,867 453,646 452,895 (5) Risk-weighted assets 4,594,692 123,890 184,584 4,470,802 4,410,107 (6) Total required capital (5)*4% 183,787 4,955 7,383 178,832 176,404 The 'Composition of Capital Disclosure' is available on our website at https://www.aozorabank.co.jp/english/ir/library/results/ - 7 -
Page 25
Aozora Bank, Ltd. Ⅱ. Status of Loans, etc. ＊ NPLs : Non-performing loans ＊ FRA : Financial Reconstruction Act 1. NPLs based on the Banking Act and the FRA, and coverage □ After partial and direct write-off 【Consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Bankrupt and similar credit 393 393 387 - 6 Doubtful credit 50,057 (26,183) (44,619) 76,241 94,677 Special attention credit 15,703 231 (3,178) 15,472 18,882 Loans overdue for three months or more 3,474 (2,613) (2,523) 6,088 5,998 Restructured loans 12,228 2,845 (654) 9,383 12,883 Subtotal (a) 66,155 (25,558) (47,410) 91,713 113,565 Normal credit 4,164,532 (11,662) 250,771 4,176,195 3,913,760 Total credit (b) 4,230,688 (37,220) 203,361 4,267,908 4,027,326 NPL ratio (a/b) 1.6% (0.5%) (1.2%) 2.1% 2.8% September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Allowance & Coverage (c) 56,708 (27,337) (47,766) 84,045 104,474 Allowance for loan losses (d) 28,457 (13,191) (20,154) 41,648 48,612 Collateral / guarantee coverage (e) 28,250 (14,146) (27,612) 42,397 55,862 85.7% (5.9%) (6.3%) 91.6% 92.0% 75.1% (9.4%) (9.1%) 84.5% 84.2% （Note）Allowance for loan losses (d) is the sum of specific allowance and general allowance for NPL credit (a). □ After partial and direct write-off 【Non-consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Bankrupt and similar credit 393 393 387 - 6 Doubtful credit 49,234 (26,323) (45,040) 75,558 94,275 Special attention credit 15,630 216 (3,211) 15,413 18,842 Loans overdue for three months or more 3,474 (2,613) (2,523) 6,088 5,998 Restructured loans 12,155 2,830 (688) 9,325 12,843 Subtotal (a) 65,258 (25,713) (47,864) 90,972 113,123 Normal credit 3,944,174 109,568 205,495 3,834,605 3,738,678 Total credit (b) 4,009,433 83,854 157,631 3,925,578 3,851,801 NPL ratio (a/b) 1.6% (0.7%) (1.3%) 2.3% 2.9% September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Allowance & Coverage (c) 55,847 (27,485) (48,206) 83,333 104,054 Allowance for loan losses (d) 27,597 (13,394) (20,607) 40,991 48,204 Collateral / guarantee coverage (e) 28,250 (14,091) (27,599) 42,341 55,849 85.6% (6.0%) (6.4%) 91.6% 92.0% 74.6% (9.7%) (9.6%) 84.3% 84.2% （Note）Allowance for loan losses (d) is the sum of specific allowance and general allowance for NPL credit (a). Coverage ratio (c/a) Allowance ratio (d/(a-e)) Coverage ratio (c/a) Allowance ratio (d/(a-e)) - 8 -
Page 26
Aozora Bank, Ltd. 2. Allowance for Loan Losses □ After partial and direct write-off 【Consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Allowance for loan losses 57,326 (13,699) (19,731) 71,025 77,057 General allowance 35,125 (2,683) (3,111) 37,809 38,237 Specific allowance 22,200 (11,016) (16,619) 33,216 38,820 - - - - - □ After partial and direct write-off 【Non-consolidated】 (Millions of yen) September 30, 2025 March 31, 2025 September 30, 2024 (A) (A) - (B) (A) - (C) (B) (C) Allowance for loan losses 55,882 (13,967) (20,379) 69,850 76,262 General allowance 34,505 (2,756) (3,326) 37,261 37,831 Specific allowance 21,377 (11,211) (17,053) 32,589 38,431 - - - - - Allowance for loans to restructuring countries Allowance for loans to restructuring countries - 9 -
Page 27
Aozora Bank, Ltd. 3. Coverage for NPLs based on the FRA by Borrowers' Category □ After partial and direct write-off 【Consolidated】 (Billions of yen) Loans other 0.3 100.0% 100.0% 0.3 Doubtful credit Collateral / Guarantee coverage 27.8 50.0 Allowance 22.2 100.0% 100.0% Estimated collections - Collateral / Guarantee coverage - 39.8% 39.8% Allowance 15.7 6.2 Estimated collections 9.4 (Normal credit) (4,164.5) Collateral / Guarantee coverage 28.2 Allowance 28.4 66.1 Estimated collections 9.4 75.1% 85.7% Total credit Total allowance 4,230.6 57.3 Allowance ratio for the unsecured portion of special attention credit 39.6% Allowance ratio for the need attention credit 8.0% Allowance ratio for the normal credit 0.3% (Note) Japanese yen figures of less than 100 million yen are truncated. Allowance ratio = Allowance / (NPL credit－Collateral, Guarantees, etc.) Bankrupt borrowers Need Attention borrowers Normal borrowers Coverage ratio = (Collateral, Guarantees＋Allowance) / NPL credit De facto bankrupt borrowers NPL credit NPLs based on the FRA Allowance ratio Collateral / Guarantee coverage Special attention credit NPLs based on the FRA Coverage ratio Bankrupt and similar credit Coverage ratio In Danger of Bankruptcy borrowers Allowance ratioAllowance & CoverageBorrower categories for self-assessment NPLs based on the FRA - 10 -
Page 28
Aozora Bank, Ltd. 4. Off-Balancing of NPLs based on the FRA 【Non-consolidated】 ① Balance of doubtful credit, and bankrupt and similar credit (Billions of yen) As of As of As of As of March 31, 2023 March 31, 2024 March 31, 2025 increase (decrease) September 30, 2025 (B) (A)-(B) (A) 32.8 26.6 5.9 (4.0) 1.8 91.6 55.3 (19.5) 35.7 14.3 (2.6) 11.6 0.4 0.4 (Note1) Japanese yen figures of less than 100 million yen are truncated. (Note2) ② Off-balancing of doubtful credit, and bankrupt and similar credit (Billions of yen) For the six months ended September 30, 2025 (20.3) Liquidation-type disposition - Restructuring-type disposition (3.5) Loan sales (9.3) Direct write-off (2.7) Other (4.7) (Note1) (Note2) (Note3) Restructuring-type disposition : debt waiver in event of restructuring-type proceedings, such as corporate reorganization, civil rehabilitation, composition and winding-up; or debt forgiveness Other : collection by disposition of collateral, business improvement of debtor, etc. If legal proceedings such as debt waiver, forgiveness, collection and so on, occur after direct write-off of book cost, relevant amounts are reentered in 'Liquidation-type disposition', 'Restructuring-type disposition' or 'Other' where appropriate and subtracted from 'Direct write-off.' Amount Categorized as above up to FY2022 Amount Newly Categorized as above for FY2024 Amount Newly Categorized as above for the six months ended September 30, 2025 Amount Newly Categorized as above for FY2023 Liquidation-type disposition : debt waiver in event of bankruptcy or special liquidation Total Japanese yen figures of less than 100 million yen are truncated. Balance as of September 30, 2025 includes those borrowers (0.3 billion yen) for whom measures are undertaken which will lead to eventual off-balancing. - 11 -
Page 29
Aozora Bank, Ltd. 5. Breakdown of Loans and Bills Discounted Classified by Industry 【Consolidated】 □ After partial and direct write-off ① Loans and Bills Discounted Classified by Industry (Millions of yen) September 30, 2025 March 31, 2025 3,252,878 3,298,786 Manufacturing 403,142 369,666 Agriculture, forestry and fisheries 845 883 Mining, quarry and gravel extraction - - Construction 26,152 25,765 Electricity, gas, heat supply and water 132,618 140,184 Information and communications 114,306 117,077 Transport and postal service 68,551 58,669 Wholesale and retail trade 132,218 75,646 Finance and insurance 442,128 411,033 Real estate 783,326 748,573 Leasing 213,672 208,079 Various services 229,372 168,009 Local government 1,890 4,931 Others 704,650 970,263 910,245 907,777 Government - - Financial institutions - - Others 910,245 907,777 Total 4,163,123 4,206,564 ② NPLs based on the FRA Classified by Industry (Millions of yen) September 30, 2025 March 31, 2025 64,519 90,039 Manufacturing 10,222 12,556 Agriculture, forestry and fisheries 0 0 Mining, quarry and gravel extraction - - Construction 129 119 Electricity, gas, heat supply and water 0 0 Information and communications 108 80 Transport and postal service 147 59 Wholesale and retail trade 794 404 Finance and insurance 0 0 Real estate 53 39 Leasing - - Various services 451 354 Local government - - Others 52,611 76,423 1,635 1,674 Government - - Financial institutions - - Others 1,635 1,674 Total 66,155 91,713 (Note) NPL credit includes accrued interest and suspense payments in other assets and customers' liabilities for acceptances and guarantees. Loans by domestic offices (excluding Japan offshore market accounts) NPL credit by domestic offices (excluding Japan offshore market accounts) Loans by oversea offices (including Japan offshore market accounts) NPL credit by oversea offices (including Japan offshore market accounts) - 12 -
Page 30
Aozora Bank, Ltd. 1. Decision on Recoverability of Deferred Tax Asset Reference）Past Taxable income (Billions of yen) FY 2022 FY 2023 FY 2024 (2.7) (59.5) 10.4 2. Temporary Differences and Loss Carryforwards 【Non-consolidated】 (Billions of yen) September 30, 2025 March 31, 2025 (A) (A) - (B) (B) 53.0 (2.6) 55.6 Provision of allowance for loan losses 19.7 (2.3) 22.1 Provision for retirement benefits 3.1 (0.0) 3.2 Write-offs for securities 4.2 (0.1) 4.4 Valuation difference on available-for-sale securities 13.2 (4.8) 18.1 Tax loss carryforwards 20.1 2.4 17.7 Other 14.6 (2.5) 17.2 Subtotal 75.2 (7.5) 82.8 Less valuation allowance (22.2) 4.9 (27.1) 3.5 (0.0) 3.6 Valuation difference on available-for-sale securities 0.8 0.0 0.7 49.4 (2.5) 52.0 Deferred tax assets Deferred tax liabilities Net deferred tax assets Ⅲ. Deferred Tax Assets We have categorized the Bank under Category 3 in accordance with Paragraph 29 of 'Guidance on Recoverability of Deferred Tax Assets’ (ASBJ Guidance on Corporate Accounting Standard No.26) and have calculated recoverable deferred tax assets based on a scheduling of the reversals of temporary differences and the estimation of future taxable income for the next 5 years. Taxable income (before offsetting of tax loss carryforwards) (*) The tax-losses were recognized mainly due to the liquidation of an overseas subsidiary. For accounting purposes, the impairment losses have already been recorded in the past profit and loss statements. （*） - 13 -