UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
For the month of November 2020
Commission File Number 001-33098
Mizuho Financial Group, Inc.
(Translation of registrants name into English)
5-5, Otemachi 1-chome
Chiyoda-ku, Tokyo 100-8176
Japan
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ☐ No ☒
If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82- .
THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE INTO THE PROSPECTUS FORMING A PART OF MIZUHO FINANCIAL GROUP, INC.S REGISTRATION STATEMENT ON FORM F-3 (FILE NO. 333-233354) AND TO BE A PART OF SUCH PROSPECTUS FROM THE DATE ON WHICH THIS REPORT IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: November 27, 2020 | ||
Mizuho Financial Group, Inc. | ||
By: |
/s/ Makoto Umemiya |
|
Name: | Makoto Umemiya | |
Title: | Senior Managing Executive Officer / Group CFO |
UNAUDITED INTERIM CONSOLIDATED JAPANESE GAAP FINANCIAL STATEMENTS
AS OF AND FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2020
On November 27, 2020, we published our unaudited interim consolidated financial statements as of and for the six months ended September 30, 2020 prepared in accordance with Japanese GAAP as part of our interim securities report (shihanki hokokusho) for the same period filed by us with the relevant Japanese authorities. We have included in this report on Form 6-K an English translation of the unaudited interim consolidated financial statements and the notes thereto included in such interim securities report. Japanese GAAP differs in certain respects from U.S. GAAP. For a description of certain differences between U.S. GAAP and Japanese GAAP, see Item 5. Operating and Financial Review and Prospects - Reconciliation with Japanese GAAP in our most recent annual report on Form 20-F filed with the U.S. Securities Exchange Commission.
Financial Information
1. |
Mizuho Financial Group, Inc. (MHFG) is a specified business company under Article 17-15, Paragraph 2 of the Cabinet Office Ordinance on Disclosure of Corporate Information, etc. and prepares the interim consolidated financial statements in the second quarter. |
2. |
The interim consolidated financial statements of MHFG are prepared in accordance with the Ordinance on the Terminology, Forms, and Preparation Methods of Interim Consolidated Financial Statements (Ordinance of the Ministry of Finance No. 24 of 1999). The classification of assets and liabilities and that of income and expenses are in accordance with the Ordinance for Enforcement of the Banking Act (Ordinance of the Ministry of Finance No. 10 of 1982). |
The interim consolidated financial statements for the six months ended September 30, 2020 are prepared in accordance with the revised Ordinance on the Terminology, Forms, and Preparation Methods of Interim Consolidated Financial Statements, pursuant to the proviso of Article 6, Paragraph 1 of the Supplementary Provisions of the Cabinet Office Ordinance for Partial Revision of the Ordinance on the Terminology, Forms, and Preparation Methods of the financial statements (Cabinet Office Ordinance No. 9 of March 6, 2020).
3. |
Ernst & Young ShinNihon LLC conducted a semiannual audit on the interim consolidated financial statements of MHFG for the six months ended September 30, 2020, pursuant to Article 193-2, Paragraph 1 of the Financial Instruments and Exchange Act. |
- 1 -
I. Interim Consolidated Financial Statements
(1) Interim Consolidated Balance Sheet
(Millions of yen) |
||||||||||||
As of
|
As of
|
|||||||||||
Assets |
||||||||||||
Cash and Due from Banks |
*8 | 41,069,745 | *8 | 42,498,278 | ||||||||
Call Loans and Bills Purchased |
584,686 | 243,267 | ||||||||||
Receivables under Resale Agreements |
18,581,488 | 12,666,551 | ||||||||||
Guarantee Deposits Paid under Securities Borrowing Transactions |
2,243,161 | 2,190,799 | ||||||||||
Other Debt Purchased |
2,688,273 | 2,676,047 | ||||||||||
Trading Assets |
*8 | 13,248,734 | *8 | 14,564,434 | ||||||||
Money Held in Trust |
411,847 | 471,782 | ||||||||||
Securities |
*1, *2, *8, *15 | 34,907,234 | *1, *2, *8, *15 | 43,314,534 | ||||||||
Loans and Bills Discounted |
*3, *4, *5, *6, *7, *8, *9 | 83,468,185 | *3, *4, *5, *6, *7, *8, *9 | 86,501,633 | ||||||||
Foreign Exchange Assets |
*7 | 2,044,415 | *7 | 1,936,636 | ||||||||
Derivatives other than for Trading Assets |
1,944,060 | 1,439,293 | ||||||||||
Other Assets |
*8 | 5,206,121 | *8 | 4,413,001 | ||||||||
Tangible Fixed Assets |
*10, *11 | 1,103,622 | *10, *11 | 1,101,614 | ||||||||
Intangible Fixed Assets |
636,139 | 619,695 | ||||||||||
Net Defined Benefit Asset |
846,782 | 924,167 | ||||||||||
Deferred Tax Assets |
32,493 | 23,368 | ||||||||||
Customers Liabilities for Acceptances and Guarantees |
6,066,527 | 5,938,130 | ||||||||||
Reserves for Possible Losses on Loans |
(424,446 | ) | (477,516 | ) | ||||||||
Reserve for Possible Losses on Investments |
| (0 | ) | |||||||||
|
|
|||||||||||
Total Assets |
214,659,077 | 221,045,717 | ||||||||||
|
|
- 2 -
(Millions of yen) |
||||||||||||
As of
|
As of
|
|||||||||||
Liabilities |
||||||||||||
Deposits |
*8 | 131,189,673 | *8 | 134,665,825 | ||||||||
Negotiable Certificates of Deposit |
13,282,561 | 14,201,308 | ||||||||||
Call Money and Bills Sold |
2,263,076 | 1,903,686 | ||||||||||
Payables under Repurchase Agreements |
*8 | 17,971,098 | *8 | 19,326,350 | ||||||||
Guarantee Deposits Received under Securities Lending Transactions |
*8 | 1,108,255 | *8 | 1,244,440 | ||||||||
Commercial Paper |
411,089 | 921,282 | ||||||||||
Trading Liabilities |
9,604,890 | 8,487,342 | ||||||||||
Borrowed Money |
*8, *12 | 5,209,947 | *8, *12 | 7,275,166 | ||||||||
Foreign Exchange Liabilities |
509,405 | 402,476 | ||||||||||
Short-term Bonds |
373,658 | 331,447 | ||||||||||
Bonds and Notes |
*13 | 8,906,432 | *13 | 9,639,781 | ||||||||
Due to Trust Accounts |
1,055,510 | 1,336,263 | ||||||||||
Derivatives other than for Trading Liabilities |
1,619,151 | 1,274,444 | ||||||||||
Other Liabilities |
6,111,195 | 4,815,831 | ||||||||||
Reserve for Bonus Payments |
75,175 | 55,860 | ||||||||||
Reserve for Variable Compensation |
2,559 | 1,467 | ||||||||||
Net Defined Benefit Liability |
62,113 | 71,950 | ||||||||||
Reserve for Director and Corporate Auditor Retirement Benefits |
944 | 635 | ||||||||||
Reserve for Possible Losses on Sales of Loans |
637 | 1,142 | ||||||||||
Reserve for Contingencies |
6,443 | 4,180 | ||||||||||
Reserve for Reimbursement of Deposits |
27,851 | 25,205 | ||||||||||
Reserve for Reimbursement of Debentures |
18,672 | 17,663 | ||||||||||
Reserves under Special Laws |
2,509 | 2,506 | ||||||||||
Deferred Tax Liabilities |
53,150 | 133,564 | ||||||||||
Deferred Tax Liabilities for Revaluation Reserve for Land |
*10 | 62,695 | *10 | 62,555 | ||||||||
Acceptances and Guarantees |
6,066,527 | 5,938,130 | ||||||||||
|
|
|||||||||||
Total Liabilities |
205,995,229 | 212,140,512 | ||||||||||
|
|
|||||||||||
Net Assets |
||||||||||||
Common Stock |
2,256,767 | 2,256,767 | ||||||||||
Capital Surplus |
1,136,467 | 1,135,948 | ||||||||||
Retained Earnings |
4,174,190 | 4,260,606 | ||||||||||
Treasury Stock |
(6,414 | ) | (7,025 | ) | ||||||||
|
|
|||||||||||
Total Shareholders Equity |
7,561,010 | 7,646,297 | ||||||||||
|
|
|||||||||||
Net Unrealized Gains (Losses) on Other Securities |
823,085 | 1,038,781 | ||||||||||
Deferred Gains or Losses on Hedges |
72,081 | 66,262 | ||||||||||
Revaluation Reserve for Land |
*10 | 136,655 | *10 | 137,834 | ||||||||
Foreign Currency Translation Adjustments |
(133,178 | ) | (170,773 | ) | ||||||||
Remeasurements of Defined Benefit Plans |
94,317 | 84,475 | ||||||||||
|
|
|||||||||||
Total Accumulated Other Comprehensive Income |
992,960 | 1,156,580 | ||||||||||
|
|
|||||||||||
Stock Acquisition Rights |
213 | 134 | ||||||||||
Non-controlling Interests |
109,662 | 102,192 | ||||||||||
|
|
|||||||||||
Total Net Assets |
8,663,847 | 8,905,205 | ||||||||||
|
|
|||||||||||
Total Liabilities and Net Assets |
214,659,077 | 221,045,717 | ||||||||||
|
|
- 3 -
(2) Interim Consolidated Statement of Income and Interim Consolidated Statement of Comprehensive Income
Interim Consolidated Statement of Income
(Millions of yen) |
||||||||||||
For the six months ended September 30, 2019 |
For the six months ended September 30, 2020 |
|||||||||||
Ordinary Income |
1,987,425 | 1,576,761 | ||||||||||
Interest Income |
1,062,855 | 693,651 | ||||||||||
Interest on Loans and Bills Discounted |
646,722 | 490,811 | ||||||||||
Interest and Dividends on Securities |
138,351 | 122,600 | ||||||||||
Fiduciary Income |
27,756 | 27,143 | ||||||||||
Fee and Commission Income |
360,492 | 397,087 | ||||||||||
Trading Income |
194,433 | 238,219 | ||||||||||
Other Operating Income |
224,188 | 156,922 | ||||||||||
Other Ordinary Income |
*1 | 117,699 | *1 | 63,736 | ||||||||
Ordinary Expenses |
1,590,953 | 1,309,150 | ||||||||||
Interest Expenses |
686,238 | 253,522 | ||||||||||
Interest on Deposits |
261,393 | 91,376 | ||||||||||
Fee and Commission Expenses |
84,392 | 77,475 | ||||||||||
Trading Expenses |
2,533 | 1,455 | ||||||||||
Other Operating Expenses |
65,839 | 68,248 | ||||||||||
General and Administrative Expenses |
670,592 | 681,287 | ||||||||||
Other Ordinary Expenses |
*2 | 81,357 | *2 | 227,161 | ||||||||
|
|
|||||||||||
Ordinary Profits |
396,471 | 267,610 | ||||||||||
|
|
|||||||||||
Extraordinary Gains |
*3 | 1,252 | *3 | 72,735 | ||||||||
Extraordinary Losses |
*4 | 6,252 | *4 | 6,955 | ||||||||
|
|
|||||||||||
Income before Income Taxes |
391,471 | 333,391 | ||||||||||
|
|
|||||||||||
Income Taxes: |
||||||||||||
Current |
85,576 | 74,186 | ||||||||||
Deferred |
10,593 | 41,813 | ||||||||||
|
|
|||||||||||
Total Income Taxes |
96,169 | 116,000 | ||||||||||
|
|
|||||||||||
Profit |
295,302 | 217,390 | ||||||||||
|
|
|||||||||||
Profit Attributable to Non-controlling Interests |
7,633 | 1,867 | ||||||||||
|
|
|||||||||||
Profit Attributable to Owners of Parent |
287,668 | 215,523 | ||||||||||
|
|
- 4 -
Interim Consolidated Statement of Comprehensive Income
(Millions of yen) |
||||||||||||
For the six months ended September 30, 2019 |
For the six months ended September 30, 2020 |
|||||||||||
Profit |
295,302 | 217,390 | ||||||||||
Other Comprehensive Income |
(104,853 | ) | 158,782 | |||||||||
Net Unrealized Gains (Losses) on Other Securities |
(122,173 | ) | 212,348 | |||||||||
Deferred Gains or Losses on Hedges |
74,719 | (5,843 | ) | |||||||||
Foreign Currency Translation Adjustments |
(34,547 | ) | (36,529 | ) | ||||||||
Remeasurements of Defined Benefit Plans |
(20,957 | ) | (9,851 | ) | ||||||||
Share of Other Comprehensive Income of Associates Accounted for Using Equity Method |
(1,894 | ) | (1,341 | ) | ||||||||
|
|
|||||||||||
Comprehensive Income |
190,448 | 376,172 | ||||||||||
|
|
|||||||||||
(Breakdown) |
||||||||||||
Comprehensive Income Attributable to Owners of Parent |
184,486 | 377,963 | ||||||||||
Comprehensive Income Attributable to Non-controlling Interests |
5,962 | (1,791 | ) |
- 5 -
(3) Interim Consolidated Statement of Changes in Net Assets
For the six months ended September 30, 2019
(Millions of yen) | ||||||||||||||||||||
Shareholders Equity | ||||||||||||||||||||
Common Stock | Capital Surplus | Retained Earnings | Treasury Stock |
Total
Shareholders Equity |
||||||||||||||||
Balance as of the beginning of the period |
2,256,767 | 1,138,449 | 3,915,521 | (7,703 | ) | 7,303,034 | ||||||||||||||
Changes during the period |
||||||||||||||||||||
Cash Dividends |
(95,197 | ) | (95,197 | ) | ||||||||||||||||
Profit Attributable to Owners of Parent |
287,668 | 287,668 | ||||||||||||||||||
Repurchase of Treasury Stock |
(1,850 | ) | (1,850 | ) | ||||||||||||||||
Disposition of Treasury Stock |
(625 | ) | 2,744 | 2,119 | ||||||||||||||||
Transfer from Revaluation Reserve for Land |
55 | 55 | ||||||||||||||||||
Change in Treasury Shares of Parent Arising from Transactions with Non-controlling Shareholders |
(885 | ) | (885 | ) | ||||||||||||||||
Transfer from Retained Earnings to Capital Surplus |
611 | (611 | ) | | ||||||||||||||||
Net Changes in Items other than Shareholders equity |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Changes during the period |
| (899 | ) | 191,915 | 893 | 191,910 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance as of the end of the period |
2,256,767 | 1,137,550 | 4,107,437 | (6,809 | ) | 7,494,945 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
Accumulated Other Comprehensive Income |
Stock
Acquisition Rights |
Non-
controlling Interests |
Total Net
Assets |
|||||||||||||||||||||||||||||||||
Net Unrealized
Gains (Losses) on Other Securities |
Deferred Gains
or Losses on Hedges |
Revaluation
Reserve for Land |
Foreign
Currency Translation Adjustments |
Remeasurements
of Defined Benefit Plans |
Total
Accumulated Other Comprehensive Income |
|||||||||||||||||||||||||||||||
Balance as of the beginning of the period |
1,186,401 | (22,282 | ) | 137,772 | (111,057 | ) | 254,936 | 1,445,770 | 707 | 444,525 | 9,194,038 | |||||||||||||||||||||||||
Changes during the period |
||||||||||||||||||||||||||||||||||||
Cash Dividends |
(95,197 | ) | ||||||||||||||||||||||||||||||||||
Profit Attributable to Owners of Parent |
287,668 | |||||||||||||||||||||||||||||||||||
Repurchase of Treasury Stock |
(1,850 | ) | ||||||||||||||||||||||||||||||||||
Disposition of Treasury Stock |
2,119 | |||||||||||||||||||||||||||||||||||
Transfer from Revaluation Reserve for Land |
55 | |||||||||||||||||||||||||||||||||||
Change in Treasury Shares of Parent Arising from Transactions with Non-controlling Shareholders |
(885 | ) | ||||||||||||||||||||||||||||||||||
Transfer from Retained Earnings to Capital Surplus |
| |||||||||||||||||||||||||||||||||||
Net Changes in Items other than Shareholders equity |
(119,652 | ) | 74,670 | (55 | ) | (37,096 | ) | (21,104 | ) | (103,238 | ) | (493 | ) | (308,279 | ) | (412,010 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total Changes during the period |
(119,652 | ) | 74,670 | (55 | ) | (37,096 | ) | (21,104 | ) | (103,238 | ) | (493 | ) | (308,279 | ) | (220,100 | ) | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance as of the end of the period |
1,066,749 | 52,387 | 137,716 | (148,153 | ) | 233,831 | 1,342,532 | 213 | 136,245 | 8,973,937 | ||||||||||||||||||||||||||
|
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|
|
|
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|
|
|
|
|
|
|
|
|
|
- 6 -
For the six months ended September 30, 2020
(Millions of yen) | ||||||||||||||||||||
Shareholders Equity | ||||||||||||||||||||
Common Stock | Capital Surplus | Retained Earnings | Treasury Stock |
Total
Shareholders Equity |
||||||||||||||||
Balance as of the beginning of the period |
2,256,767 | 1,136,467 | 4,174,190 | (6,414 | ) | 7,561,010 | ||||||||||||||
Cumulative Effects of Changes in Accounting Policies |
(32,639 | ) | (32,639 | ) | ||||||||||||||||
Balance as of the beginning of the period reflecting Changes in Accounting Policies |
2,256,767 | 1,136,467 | 4,141,550 | (6,414 | ) | 7,528,370 | ||||||||||||||
Changes during the period |
||||||||||||||||||||
Cash Dividends |
(95,208 | ) | (95,208 | ) | ||||||||||||||||
Profit Attributable to Owners of Parent |
215,523 | 215,523 | ||||||||||||||||||
Repurchase of Treasury Stock |
(1,995 | ) | (1,995 | ) | ||||||||||||||||
Disposition of Treasury Stock |
(80 | ) | 1,385 | 1,305 | ||||||||||||||||
Transfer from Revaluation Reserve for Land |
(1,178 | ) | (1,178 | ) | ||||||||||||||||
Change in Treasury Shares of Parent Arising from Transactions with Non-controlling Shareholders |
(519 | ) | (519 | ) | ||||||||||||||||
Transfer from Retained Earnings to Capital Surplus |
80 | (80 | ) | | ||||||||||||||||
Net Changes in Items other than Shareholders equity |
||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Total Changes during the period |
| (519 | ) | 119,056 | (610 | ) | 117,926 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|||||||||||
Balance as of the end of the period |
2,256,767 | 1,135,948 | 4,260,606 | (7,025 | ) | 7,646,297 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
Accumulated Other Comprehensive Income | ||||||||||||||||||||||||||||||||||||
Net Unrealized
Gains (Losses) on Other Securities |
Deferred Gains
or Losses on Hedges |
Revaluation
Reserve for Land |
Foreign
Currency Translation Adjustments |
Remeasurements
of Defined Benefit Plans |
Total
Accumulated Other Comprehensive Income |
Stock
Acquisition Rights |
Non-
controlling Interests |
Total Net
Assets |
||||||||||||||||||||||||||||
Balance as of the beginning of the period |
823,085 | 72,081 | 136,655 | (133,178 | ) | 94,317 | 992,960 | 213 | 109,662 | 8,663,847 | ||||||||||||||||||||||||||
Cumulative Effects of Changes in Accounting Policies |
| (32,639 | ) | |||||||||||||||||||||||||||||||||
Balance as of the beginning of the period reflecting Changes in Accounting Policies |
823,085 | 72,081 | 136,655 | (133,178 | ) | 94,317 | 992,960 | 213 | 109,662 | 8,631,208 | ||||||||||||||||||||||||||
Changes during the period |
||||||||||||||||||||||||||||||||||||
Cash Dividends |
(95,208 | ) | ||||||||||||||||||||||||||||||||||
Profit Attributable to Owners of Parent |
215,523 | |||||||||||||||||||||||||||||||||||
Repurchase of Treasury Stock |
(1,995 | ) | ||||||||||||||||||||||||||||||||||
Disposition of Treasury Stock |
1,305 | |||||||||||||||||||||||||||||||||||
Transfer from Revaluation Reserve for Land |
(1,178 | ) | ||||||||||||||||||||||||||||||||||
Change in Treasury Shares of Parent Arising from Transactions with Non-controlling Shareholders |
(519 | ) | ||||||||||||||||||||||||||||||||||
Transfer from Retained Earnings to Capital Surplus |
| |||||||||||||||||||||||||||||||||||
Net Changes in Items other than Shareholders equity |
215,696 | (5,819 | ) | 1,178 | (37,594 | ) | (9,842 | ) | 163,619 | (79 | ) | (7,469 | ) | 156,070 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Total Changes during the period |
215,696 | (5,819 | ) | 1,178 | (37,594 | ) | (9,842 | ) | 163,619 | (79 | ) | (7,469 | ) | 273,997 | ||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
Balance as of the end of the period |
1,038,781 | 66,262 | 137,834 | (170,773 | ) | 84,475 | 1,156,580 | 134 | 102,192 | 8,905,205 | ||||||||||||||||||||||||||
|
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- 7 -
(4) Interim Consolidated Statement of Cash Flows
(Millions of yen) | ||||||||||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||||||||||
Cash Flow from Operating Activities |
||||||||||||||||
Income before Income Taxes |
391,471 | 333,391 | ||||||||||||||
Depreciation |
69,160 | 80,450 | ||||||||||||||
Losses on Impairment of Fixed Assets |
4,010 | 1,391 | ||||||||||||||
Amortization of Goodwill |
2,033 | 1,869 | ||||||||||||||
Equity in Loss (Gain) from Investments in Affiliates |
(19,109 | ) | (11,559 | ) | ||||||||||||
Increase (Decrease) in Reserves for Possible Losses on Loans |
(7,637 | ) | 53,470 | |||||||||||||
Increase (Decrease) in Reserve for Possible Losses on Investments |
| 0 | ||||||||||||||
Increase (Decrease) in Reserve for Possible Losses on Sales of Loans |
(89 | ) | 504 | |||||||||||||
Increase (Decrease) in Reserve for Contingencies |
258 | (1,028 | ) | |||||||||||||
Increase (Decrease) in Reserve for Bonus Payments |
(17,352 | ) | (18,630 | ) | ||||||||||||
Increase (Decrease) in Reserve for Variable Compensation |
(1,532 | ) | (1,092 | ) | ||||||||||||
Decrease (Increase) in Net Defined Benefit Asset |
(42,534 | ) | (31,468 | ) | ||||||||||||
Increase (Decrease) in Net Defined Benefit Liability |
1,026 | 1,180 | ||||||||||||||
Increase (Decrease) in Reserve for Director and Corporate Auditor Retirement Benefits |
(334 | ) | (308 | ) | ||||||||||||
Increase (Decrease) in Reserve for Reimbursement of Deposits |
(3,180 | ) | (2,646 | ) | ||||||||||||
Increase (Decrease) in Reserve for Reimbursement of Debentures |
(4,834 | ) | (1,009 | ) | ||||||||||||
Interest Income - accrual basis |
(1,062,855 | ) | (693,651 | ) | ||||||||||||
Interest Expenses - accrual basis |
686,238 | 253,522 | ||||||||||||||
Losses (Gains) on Securities |
(154,961 | ) | (1,779 | ) | ||||||||||||
Losses (Gains) on Money Held in Trust |
(94 | ) | (1,565 | ) | ||||||||||||
Foreign Exchange Losses (Gains) - net |
149,143 | 190,646 | ||||||||||||||
Losses (Gains) on Disposition of Fixed Assets |
990 | (588 | ) | |||||||||||||
Losses (Gains) on Revision of Retirement Benefit Plan |
| (58,684 | ) | |||||||||||||
Losses (Gains) on Cancellation of Employee Retirement Benefit Trust |
| (7,895 | ) | |||||||||||||
Decrease (Increase) in Trading Assets |
(2,475,270 | ) | (1,348,924 | ) | ||||||||||||
Increase (Decrease) in Trading Liabilities |
1,915,340 | (1,148,807 | ) | |||||||||||||
Decrease (Increase) in Derivatives other than for Trading Assets |
(272,093 | ) | 513,769 | |||||||||||||
Increase (Decrease) in Derivatives other than for Trading Liabilities |
136,276 | (356,773 | ) | |||||||||||||
Decrease (Increase) in Loans and Bills Discounted |
(2,166,571 | ) | (3,180,082 | ) | ||||||||||||
Increase (Decrease) in Deposits |
2,340,667 | 3,706,210 | ||||||||||||||
Increase (Decrease) in Negotiable Certificates of Deposit |
603,216 | 887,125 | ||||||||||||||
Increase (Decrease) in Borrowed Money (excluding Subordinated Borrowed Money) |
(1,186,947 | ) | 2,040,630 | |||||||||||||
Decrease (Increase) in Due from Banks (excluding Due from Central Banks) |
(73,018 | ) | 58,994 | |||||||||||||
Decrease (Increase) in Call Loans, etc. |
(1,150,293 | ) | 6,119,257 | |||||||||||||
Decrease (Increase) in Guarantee Deposits Paid under Securities Borrowing Transactions |
(492,325 | ) | 52,362 | |||||||||||||
Increase (Decrease) in Call Money, etc. |
2,460,640 | 1,321,413 | ||||||||||||||
Increase (Decrease) in Commercial Paper |
(260,467 | ) | 521,600 | |||||||||||||
Increase (Decrease) in Guarantee Deposits Received under Securities Lending Transactions |
92,478 | 136,184 | ||||||||||||||
Decrease (Increase) in Foreign Exchange Assets |
103,819 | 96,730 | ||||||||||||||
Increase (Decrease) in Foreign Exchange Liabilities |
(122,722 | ) | (107,635 | ) | ||||||||||||
Increase (Decrease) in Short-term Bonds (Liabilities) |
(5,788 | ) | (42,210 | ) | ||||||||||||
Increase (Decrease) in Bonds and Notes |
142,827 | 506,833 | ||||||||||||||
Increase (Decrease) in Due to Trust Accounts |
12,427 | 280,752 | ||||||||||||||
Interest and Dividend Income - cash basis |
1,081,614 | 768,705 | ||||||||||||||
Interest Expenses - cash basis |
(711,379 | ) | (333,961 | ) | ||||||||||||
Other - net |
472,110 | (200,012 | ) | |||||||||||||
|
|
|
|
|||||||||||||
Subtotal |
434,358 | 10,376,684 | ||||||||||||||
|
|
|
|
|||||||||||||
Cash Refunded (Paid) in Income Taxes |
(40,759 | ) | (131,734 | ) | ||||||||||||
|
|
|
|
|||||||||||||
Net Cash Provided by (Used in) Operating Activities |
393,599 | 10,244,949 | ||||||||||||||
|
|
|
|
- 8 -
(Millions of yen) | ||||||||||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||||||||||
Cash Flow from Investing Activities |
||||||||||||||||
Payments for Purchase of Securities |
(41,534,948 | ) | (48,153,087 | ) | ||||||||||||
Proceeds from Sale of Securities |
29,904,670 | 24,703,651 | ||||||||||||||
Proceeds from Redemption of Securities |
10,050,392 | 14,798,919 | ||||||||||||||
Payments for Increase in Money Held in Trust |
(20,952 | ) | (63,426 | ) | ||||||||||||
Proceeds from Decrease in Money Held in Trust |
25,375 | 4,841 | ||||||||||||||
Payments for Purchase of Tangible Fixed Assets |
(34,074 | ) | (36,629 | ) | ||||||||||||
Payments for Purchase of Intangible Fixed Assets |
(46,876 | ) | (47,263 | ) | ||||||||||||
Proceeds from Sale of Tangible Fixed Assets |
3,605 | 12,855 | ||||||||||||||
Proceeds from Sale of Intangible Fixed Assets |
3,144 | | ||||||||||||||
Proceeds from Sales of Stocks of Subsidiaries (affecting the scope of consolidation) |
| 497 | ||||||||||||||
|
|
|
|
|||||||||||||
Net Cash Provided by (Used in) Investing Activities |
(1,649,665 | ) | (8,779,640 | ) | ||||||||||||
|
|
|
|
|||||||||||||
Cash Flow from Financing Activities |
||||||||||||||||
Proceeds from Subordinated Borrowed Money |
| 30,000 | ||||||||||||||
Proceeds from Issuance of Subordinated Bonds |
325,000 | 287,000 | ||||||||||||||
Payments for Redemption of Subordinated Bonds |
(118,000 | ) | (50,000 | ) | ||||||||||||
Proceeds from Investments by Non-controlling Shareholders |
2,530 | 2,543 | ||||||||||||||
Repayments to Non-controlling Shareholders |
(303,000 | ) | | |||||||||||||
Cash Dividends Paid |
(95,165 | ) | (95,242 | ) | ||||||||||||
Cash Dividends Paid to Non-controlling Shareholders |
(10,011 | ) | (4,074 | ) | ||||||||||||
Payments for Purchase of Stocks of Subsidiaries (not affecting the scope of consolidation) |
(4,653 | ) | | |||||||||||||
Payments for Repurchase of Treasury Stock |
(1,435 | ) | (1,503 | ) | ||||||||||||
Proceeds from Sale of Treasury Stock |
1,515 | 838 | ||||||||||||||
Payments for Repurchase of Treasury Stock of Subsidiaries |
| (5,414 | ) | |||||||||||||
|
|
|
|
|||||||||||||
Net Cash Provided by (Used in) Financing Activities |
(203,220 | ) | 164,147 | |||||||||||||
|
|
|
|
|||||||||||||
Effect of Foreign Exchange Rate Changes on Cash and Cash Equivalents |
(254,539 | ) | (120,684 | ) | ||||||||||||
|
|
|
|
|||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents |
(1,713,824 | ) | 1,508,771 | |||||||||||||
|
|
|
|
|||||||||||||
Cash and Cash Equivalents at the beginning of the period |
44,254,874 | 39,863,604 | ||||||||||||||
|
|
|
|
|||||||||||||
Cash and Cash Equivalents at the end of the period |
*1 | 42,541,050 | *1 | 41,372,376 | ||||||||||||
|
|
|
|
- 9 -
Notes to Interim Consolidated Financial Statements
Fundamental and Important Matters for the Preparation of Interim Consolidated Financial Statements
1. |
Scope of Consolidation |
(1) |
Number of consolidated subsidiaries: 153 |
Names of principal companies:
Mizuho Bank, Ltd.
Mizuho Trust & Banking Co., Ltd.
Mizuho Securities Co., Ltd.
Change in scope of consolidation
During the six months ended September 30, 2020, Mizuho After Corona Business Succession Assist Fund Limited Partnership and thirty-eight other companies were newly included in the scope of consolidation as a result of establishment.
During the six months ended September 30, 2020, Mizuho Operation Service Ltd. and eleven other companies were excluded from the scope of consolidation as a result of decrease in share ownership and other factors.
(2) |
Number of non-consolidated subsidiaries: 0 |
2. |
Application of the Equity Method |
(1) |
Number of non-consolidated subsidiaries under the equity method: 0 |
(2) |
Number of affiliates under the equity method: 26 |
Names of principal companies:
Custody Bank of Japan, Ltd.
Orient Corporation
Mizuho Leasing Company, Limited
Change in scope of equity method
During the six months ended September 30, 2020, One Tap BUY Co., Ltd. and one other company were newly included in the scope of equity method as a result of increase in share ownership and other factor.
During the six months ended September 30, 2020, JTC Holdings, Ltd. and one other company were excluded from the scope of consolidation as a result of merger.
(3) |
Number of non-consolidated subsidiaries not under the equity method: 0 |
(4) |
Affiliates not under the equity method: |
Pec International Leasing Co., Ltd.
Affiliates not under the equity method are excluded from the scope of the equity method since such exclusion has no material effect on MHFGs interim consolidated financial statements in terms of Net Income (Loss) (amount corresponding to MHFGs equity position), Retained Earnings (amount corresponding to MHFGs equity position), Accumulated Other Comprehensive Income (amount corresponding to MHFGs equity position) and others.
- 10 -
3. |
Interim Balance Sheet Dates of Consolidated Subsidiaries |
(1) |
Interim balance sheet dates of consolidated subsidiaries are as follows: |
January 31 | 1 company | |||
June 30 | 41 companies | |||
September 30 | 111 companies |
(2) |
A consolidated subsidiary with the interim balance sheet date of January 31 was consolidated based on its tentative interim financial statements as of and for the period ended the interim consolidated balance sheet date. Other consolidated subsidiaries were consolidated based on their interim financial statements as of and for the period ended their respective interim balance sheet dates. |
The necessary adjustments have been made to the interim financial statements for any significant transactions that took place between their respective interim balance sheet dates and the date of the interim consolidated financial statements.
4. |
Standards of Accounting Method |
(1) |
Credited Loans pursuant to Trading Securities and Trading Income & Expenses |
Credited loans held for the purpose of trading are, in line with trading securities, recognized on a trade date basis and recorded in Other Debt Purchased on the interim consolidated balance sheet. Other Debt Purchased related to the relevant credited loans is stated at fair value at the interim consolidated balance sheet date. Interest received and the gains or losses on the sale of the relevant credited loans during the six months ended September 30, 2020, including the gains or losses resulting from any change in the value between the beginning and the end of the six months ended September 30, 2020, are recognized in Other Operating Income and Other Operating Expenses on the interim consolidated statement of income.
(2) |
Trading Assets & Liabilities and Trading Income & Expenses |
Trading transactions intended to take advantage of short-term fluctuations and arbitrage opportunities in interest rates, currency exchange rates, market prices of securities and related indices are recognized on a trade date basis and recorded in Trading Assets or Trading Liabilities on the interim consolidated balance sheet. Income or expenses generated on the relevant trading transactions are recorded in Trading Income or Trading Expenses on the interim consolidated statement of income.
Securities and other monetary claims held for trading purposes are stated at fair value at the interim consolidated balance sheet date. Derivative financial products, such as swaps, futures and option transactions, are stated at fair value, assuming that such transactions are terminated and settled at the interim consolidated balance sheet date.
Trading Income and Trading Expenses include the interest received and the interest paid during the six months ended September 30, 2020, the gains or losses resulting from any change in the value of securities and other monetary claims between the beginning and the end of the six months ended September 30, 2020, and the gains or losses resulting from any change in the value of financial derivatives between the beginning and the end of the six months ended September 30, 2020, assuming they were settled at the end of the six months ended September 30, 2020.
For financial derivatives, fair value is calculated on the basis of net assets or liabilities after offsetting financial assets and liabilities with respect to specific market risks and specific credit risk.
- 11 -
(3) |
Securities |
(a) |
Bonds held to maturity are stated at amortized cost (straight-line method) and determined by the moving average method. Investments in affiliates not under the equity method are stated at acquisition cost and determined by the moving average method. Other Securities are stated at market price (cost of securities sold is calculated primarily by the moving average method). Stocks and others without a quoted market price are stated at acquisition cost and determined by the moving average method. |
The net unrealized gains (losses) on Other Securities are included directly in Net Assets, net of applicable income taxes after excluding gains and losses as a result of the fair-value hedge method.
(b) |
Securities which are held as trust assets in Money Held in Trust accounts are valued in the same way as described in (a) above. |
(4) |
Derivative Transactions |
Derivative transactions (other than transactions for trading purposes) are valued at fair value.
Fair value is calculated on the basis of net assets or liabilities after offsetting financial assets and liabilities with respect to specific market risks and specific credit risk.
(5) |
Depreciation of Fixed Assets |
1) |
Tangible Fixed Assets (Except for Lease Assets) |
Depreciation of buildings is computed mainly by the straight-line method, and that of others is computed mainly by the declining-balance method. The amount based on estimated annual depreciation expenses is allocated to each period.
The range of useful lives is as follows:
Buildings |
3 years to 50 years | |||
Others |
2 years to 20 years |
2) |
Intangible Fixed Assets (Except for Lease Assets) |
Amortization of Intangible Fixed Assets is computed by the straight-line method. Development costs for internally-used software are capitalized and amortized over their estimated useful lives of mainly from five to ten years as determined by MHFG and consolidated subsidiaries.
3) |
Lease Assets |
Depreciation of lease assets booked in Tangible Fixed Assets and Intangible Fixed Assets which are concerned with finance lease transactions that do not transfer ownership is mainly computed by the same method as the one applied to fixed assets owned by us.
(6) |
Deferred Assets |
Bond issuance costs are expensed as incurred.
- 12 -
(7) |
Reserves for Possible Losses on Loans |
Reserves for Possible Losses on Loans of major domestic consolidated subsidiaries are maintained in accordance with internally established standards for write-offs and reserve provisions.
For claims extended to obligors that are legally bankrupt under the Bankruptcy Law, Special Liquidation under the Company Law or other similar laws (Bankrupt Obligors), and to obligors that are effectively in similar conditions (Substantially Bankrupt Obligors), reserves are maintained at the amounts of claims net of direct write-offs described below and the expected amounts recoverable from the disposition of collateral and the amounts recoverable under guarantees. For claims extended to obligors that are not yet legally or formally bankrupt but are likely to be bankrupt (Intensive Control Obligors), reserves are maintained at the amounts deemed necessary based on overall solvency analyses of the amounts of claims net of expected amounts recoverable from the disposition of collateral and the amounts recoverable under guarantees.
For claims extended to Intensive Control Obligors and Obligors with Restructured Loans and others, if the exposure to an obligor exceeds a certain specific amount, reserves are provided as follows: (i) if future cash flows of the principal and interest can be reasonably estimated, the discounted cash flow method is applied, under which the reserve is determined as the difference between the book value of the loan and its present value of future cash flows discounted using the contractual interest rate before the loan was classified as a Restructured Loan, and (ii) if future cash flows of the principal and interest cannot be reasonably estimated, reserves are provided for the losses estimated for each individual loan.
For claims extended to other obligors, reserves for the next one year or three years are maintained at rates derived from historical credit loss experience or historical bankruptcy experience for one or three years and making necessary adjustments such as future prospects and others. Reserve for Possible Losses on Loans to Restructuring Countries is maintained in order to cover possible losses based on analyses of the political and economic climates of the countries.
All claims are assessed by each claim origination department in accordance with the internally established Self-assessment Standard, and the results of the assessments are verified and examined by the independent examination departments.
In the case of claims to Bankrupt Obligors and Substantially Bankrupt Obligors, which are collateralized or guaranteed by a third party, the amounts deemed uncollectible (calculated by deducting the anticipated proceeds from the sale of collateral pledged against the claims and amounts that are expected to be recovered from guarantors of the claims) are written off against the respective claims balances. The total directly written-off amount was ¥109,898 million (¥89,216 million at the end of the fiscal year ended March 31, 2020).
Other consolidated subsidiaries provide the amount necessary to cover the loan losses based upon past experience and other factors for general claims and the assessment for each individual loan for other claims.
(Additional Information)
In light of the principles set forth in the report entitled Japanese Financial Services Agency (JFSA)s supervisory approaches to lending business and loan loss provisioning published by JFSA in December 18, 2019, we have reflected the potential impact of the spread of COVID-19 and its prolongation on Reserves for Possible Losses on Loans for some credit. More specifically, we have identified certain industries and certain obligors that are expected to be significantly impacted by the COVID-19. For these identified industries and obligors, we have updated the estimated expected loss amount by incorporating certain assumptions such as the future recovery periods and the forecasted GDP growth rate in Japan. Among the major assumptions applied to the relevant estimates, we have adopted the prospect that the period for the settling down of COVID-19 would be longer than we had expected at the end of the previous fiscal year.
(8) |
Reserve for Possible Losses on Investments |
Reserve for Possible Losses on Investments is maintained to provide against possible losses on investments in securities, after taking into consideration the financial condition and other factors concerning the investee company.
(9) |
Reserve for Bonus Payments |
Reserve for Bonus Payments, which is provided for future bonus payments to employees, is maintained at the amount accrued at the end of the six months ended September 30, 2020, based on the estimated future payments.
- 13 -
(10) |
Reserve for Variable Compensation |
To prepare for the payments of performance payments and stock compensation to be paid as variable compensation within compensation for directors and executive officers of Mizuho Financial Group, Inc., Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., and Mizuho Securities Co., Ltd., the amount accrued at the end of the six months ended September 30, 2020 among the estimated payments based on the standard amount regarding variable compensation of the fiscal year ending March 31, 2020 is provided.
(11) |
Reserve for Director and Corporate Auditor Retirement Benefits |
Reserve for Director and Corporate Auditor Retirement Benefits, which is provided for future retirement benefit payments to directors, corporate auditors, and executive officers, is recognized at the amount accrued by the end of the six months ended September 30, 2020, based on the internally established standards.
(12) |
Reserve for Possible Losses on Sales of Loans |
Reserve for Possible Losses on Sales of Loans is provided for possible future losses on sales of loans at the amount deemed necessary based on a reasonable estimate of possible future losses.
(13) |
Reserve for Contingencies |
Reserve for Contingencies is maintained to provide against possible losses from contingencies which are not covered by other specific reserves. The balance is an estimate of possible future losses considered to require a reserve.
(14) |
Reserve for Reimbursement of Deposits |
Reserve for Reimbursement of Deposits is provided against the losses for the deposits derecognized from liabilities at the estimated amount of future claims for withdrawal by depositors.
(15) |
Reserve for Reimbursement of Debentures |
Reserve for Reimbursement of Debentures is provided for the debentures derecognized from liabilities at the estimated amount for future claims.
(16) |
Reserve under Special Laws |
Reserve under Special Laws is Reserve for Contingent Liabilities from Financial Instruments and Exchange. This is the reserve pursuant to Article 46-5 of the Financial Instruments and Exchange Law and Article 175 of the Cabinet Office Ordinance regarding Financial Instruments Business, etc. to indemnify the losses incurred from accidents in the purchase and sale of securities, other transactions or derivative transactions.
(17) |
Accounting Method for Retirement Benefits |
In calculating retirement benefit obligations, a benefit formula basis is used as a method of attributing expected retirement benefits to the period up to the end of the six months ended September 30, 2020. Unrecognized prior service cost and unrecognized actuarial differences are recognized as follows:
Unrecognized prior service cost: Recognized mainly as income or expenses in the period of occurrence.
Unrecognized actuarial difference: Recognized as income or expenses from the following fiscal year under the straight-line method over a certain term within the average remaining service period of the employees (mainly 10 years) of the respective fiscal years.
Certain consolidated subsidiaries apply the simplified method that assumes the amount required for voluntary resignation at the end of the six months ended September 30, 2020 to be retirement benefit obligations in computing net defined benefit liability and retirement benefit expenses.
- 14 -
(18) |
Assets and Liabilities denominated in foreign currencies |
Assets and liabilities denominated in foreign currencies and accounts of overseas branches of domestic consolidated banking subsidiaries and a domestic consolidated trust banking subsidiary are translated into Japanese yen primarily at the exchange rates in effect at the interim consolidated balance sheet date, with the exception of the investments in affiliates not under the equity method, which are translated at historical exchange rates.
Assets and liabilities denominated in foreign currencies of the consolidated subsidiaries, except for the transactions mentioned above, are translated into Japanese yen primarily at the exchange rates in effect at the respective interim balance sheet dates.
(19) |
Hedge Accounting |
(a) |
Interest Rate Risk |
The deferred method, the fair-value hedge method or the exceptional accrual method for interest rate swaps are applied as hedge accounting methods.
The portfolio hedge transaction for a large volume of small-value monetary claims and liabilities of domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries is accounted for in accordance with the method stipulated in the Accounting and Auditing Treatment relating to Adoption of Accounting Standards for Financial Instruments for Banks (JICPA Industry Audit Committee Report No. 24, February 13, 2002).
The effectiveness of hedging activities for the portfolio hedge transaction for a large volume of small-value monetary claims and liabilities is assessed as follows:
i) |
as for hedging activities to offset market fluctuation risks, the effectiveness is assessed by bracketing both the hedged instruments, such as deposits and loans, and the hedging instruments, such as interest-rate swaps, in the same maturity bucket. |
ii) |
as for hedging activities to fix the cash flows, the effectiveness is assessed based on the correlation between a base interest rate index of the hedged instrument and that of the hedging instrument. |
The effectiveness of the individual hedge is assessed based on the comparison of the fluctuation in the market or of cash flows of the hedged instruments with that of the hedging instruments.
(b) |
Foreign Exchange Risk |
Domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries apply the deferred method of hedge accounting to hedge foreign exchange risks associated with various financial assets and liabilities denominated in foreign currencies as stipulated in the Accounting and Auditing Treatment relating to Adoption of Accounting Standards for Foreign Currency Transactions for Banks (JICPA Industry Audit Committee Report No. 25, July 29, 2002). The effectiveness of the hedge is assessed by confirming that the amount of the foreign currency position of the hedged monetary claims and liabilities is equal to or larger than that of currency-swap transactions, exchange swap transactions, and similar transactions designated as the hedging instruments of the foreign exchange risk.
In addition to the above methods, these subsidiaries apply the deferred method or the fair-value hedge method to portfolio hedges of the foreign exchange risks associated with investments in subsidiaries and affiliates in foreign currency and Other Securities in foreign currency (except for bonds) identified as hedged items in advance, as long as the amount of foreign currency payables of spot and forward foreign exchange contracts exceeds the amount of acquisition cost of the hedged foreign securities in foreign currency.
- 15 -
(c) |
Inter-company Transactions |
Inter-company interest rate swaps, currency swaps and similar derivatives among consolidated companies or between trading accounts and other accounts, which are designated as hedges, are not eliminated and related gains and losses are recognized in the statement of income or deferred under hedge accounting, because these inter-company derivatives are executed according to the criteria for appropriate outside third-party cover operations which are treated as hedge transactions objectively in accordance with JICPA Industry Audit Committee Reports No. 24 and 25.
As for certain assets and liabilities of MHFG and its consolidated subsidiaries, the deferred method, the fair-value hedge method or the exceptional accrual method for interest rate swaps are applied.
(20) |
Scope of Cash and Cash Equivalents on Interim Consolidated Statements of Cash Flows |
In the interim consolidated statements of cash flows, Cash and Cash Equivalents consist of cash and due from central banks included in Cash and Due from Banks on the interim consolidated balance sheet.
(21) |
Consumption Taxes and other |
With respect to MHFG and its domestic consolidated subsidiaries, Japanese consumption taxes and local consumption taxes are excluded from transaction amounts.
Changes in Accounting Policies
(Accounting Standard for Fair Value Measurement and Others)
MHFG has applied Accounting Standard for Fair Value Measurement (ASBJ Statement No.30 July 4, 2019) and others from the beginning of the interim period ended September 30, 2020.
In accordance with Article 8 of Accounting Standard for Fair Value Measurement, the fair value adjustment method used to determine the fair value of derivatives is revised to maximize the use of relevant observable inputs estimated from derivatives and others traded in the market.
In accordance with Article 20 of Accounting Standard for Fair Value Measurement, the cumulative effects arising from the retroactive application of these new accounting policies to all the previous fiscal years were reflected in Retained Earnings as of April 1, 2020.
As a result, Retained Earnings decreased by ¥32,639 million, Trading Assets decreased by ¥50,380 million, Derivatives other than for Trading Assets decreased by ¥6,379 million, Trading Liabilities decreased by ¥6,529 million, Derivatives other than for Trading Liabilities decreased by ¥3,184 million, Deferred Tax Assets increased by ¥14,405 million, and Net Assets per Share decreased by ¥12.87 as of April 1, 2020. The share consolidation was taken place at a ratio of ten pre-consolidation shares to one post-consolidation share on October 1, 2020. Net Asset per share is calculated under the assumption that the share consolidation had been taken place at the beginning of fiscal 2019.
And in accordance with the transitional treatment set forth in Article 19 of Accounting Standard for Fair Value Measurement and Article 44-2 of Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019), MHFG has applied a new accounting policy prescribed by Accounting Standard for Fair Value Measurement and others from the interim period ended September 30, 2020.
As a result, in principle, while fair value of Japanese stocks was previously determined based on the average quoted market price over the month preceding the interim consolidated balance sheet date, from the end of the interim period ended September 30, 2020, fair value of Japanese stocks is determined based on the quoted market price as of the interim consolidated balance sheet date.
Additional Information
The Board Benefit Trust (BBT) Program
Since MHFG operates its business to contribute to the creation of value for diverse stakeholders and realize improved corporate value through the continuous and stable growth of MHFG group pursuant to MHFGs basic management policy defined under the Mizuho Financial Groups Corporate Identity, MHFG has introduced a stock compensation program using a trust (the Program) that functions as an incentive for each Director, Executive Officer, and Specialist Officer to exert maximum effort in performing his or her duties, and also as consideration for such exertion of effort.
(1) |
Outline of the Program |
The Program has adopted the Board Benefit Trust (BBT) framework. MHFGs shares on the stock market will be acquired through a trust established based on the underlying funds contributed by MHFG, and MHFGs shares will be distributed to Directors, Executive Officers, and Specialist Officers of MHFG, Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., and Mizuho Securities Co., Ltd. (the Company Group) in accordance with the Rules on Distribution of Shares to be prescribed in advance. The framework consists of the stock compensation program based on the Company Group Officers position in their respective company (Stock Compensation I) and the stock compensation program based on the performance evaluation of the Company Group (Stock Compensation II).
- 16 -
Stock Compensation I will be paid at the time of retirement in the form of shares of MHFG calculated based on their position. A system is adopted which enables a decrease or forfeiture of the amount depending on the performance of the company or the individual.
Stock Compensation II will be paid in the form of shares of MHFG and will be deferred over three years, which is calculated based on the status of achieving our Five-Year Business Plan. A system is adopted which enables a decrease or forfeiture of the amount depending on the performance of the company or the individual.
Upon the payment of stock compensation under the Program, MHFG may, for a certain portion, pay a monetary amount equivalent to the market value of its stock in lieu of stock compensation in accordance with the Rules on Distribution of Shares.
Voting rights related to MHFGs shares belonging to the trust assets under the trust shall not be exercised.
(2) |
MHFGs Shares Outstanding in the Trust |
MHFGs shares outstanding in the trust are recognized as Treasury Stock under Net Assets at the carrying amount (excluding the amount of incidental expenses) in the trust. The carrying amount of such Treasury Stock as of September 30, 2020 was ¥4,148 million for 25,564 thousand shares (the carrying amount as of March 31, 2020 was ¥3,485 million for 19,636 thousand shares).
Application of tax-effect accounting to the Transition from the Consolidated Taxation System to the Group Aggregation System
Some domestic consolidated subsidiaries of the Group record amounts of deferred tax assets and deferred tax liabilities based on the provisions of tax laws prior to amendment under the treatment in Paragraph 3 of Treatment of the application of the tax-effect accounting in relation to the transition from the consolidated tax system to the aggregate group system (Practical Solutions No.39 March 31, 2020), without applying the provisions of Paragraph 44 of Guidance on Accounting Standard for tax-effect accounting (Implementation Guidance No.28 February 16, 2018), regarding the tax items for which review of the non-consolidated Tax Payment System was implemented in accordance with the transition to the aggregated group system established under the Act for Partial Revision of the Income Tax Act, etc. (Act No. 8 of 2020) and the transition to the aggregated group system.
- 17 -
Notes to Interim Consolidated Balance Sheet
*1. |
The total amount of shares and investments in affiliates |
|
(Millions of yen) | |||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Shares |
331,855 | 339,807 | ||||||
Investments |
534 | 530 |
*2. |
Unsecured loaned securities, which are included in Japanese Government Bonds under Securities, are as follows: |
|
(Millions of yen) | |||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
80,056 | |
In certain transactions, MHFG has the right to sell or repledge the following unsecured borrowed securities, securities purchased under resale agreements and securities borrowed with cash collateral.
|
(Millions of yen) | |||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Securities repledged |
19,960,803 | 12,779,574 | ||||||
Securities neither repledged nor re-loaned at the end of the period/the fiscal year |
1,998,251 | 2,589,760 |
*3. |
Loans to Bankrupt Obligors and Non-Accrual Delinquent Loans, which are included in Loans and Bills Discounted, are as follows: |
|
(Millions of yen) | |||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Loans to Bankrupt Obligors |
15,938 | 32,552 | ||||||
Non-Accrual Delinquent Loans |
401,016 | 412,673 |
Loans to Bankrupt Obligors are loans, excluding loans written-off, on which delinquencies in payment of principal and/or interest have continued for a significant period of time or for some other reason there is no prospect of collecting principal and/or interest (Non-Accrual Loans), as per Article 96, Paragraph 1, Item 3, Subsections 1 to 5 or Item 4 of the Corporate Tax Law Enforcement Ordinance (Government Ordinance No. 97, 1965).
Non-Accrual Delinquent Loans represent Non-Accrual Loans other than (i) Loans to Bankrupt Obligors and (ii) loans on which interest payments have been deferred in order to assist or facilitate the restructuring of the obligors.
*4. |
Balance of Loans Past Due for Three Months or More, which is included in Loans and Bills Discounted, is as follows: |
|
(Millions of yen) | |||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Loans Past Due for Three Months or More |
1,468 | 559 |
Loans Past Due for Three Months or More are loans on which payments of principal and/or interest have not been made for a period of three months or more since the next day following the first due date without such payments, and which are not included in Loans to Bankrupt Obligors, or Non-Accrual Delinquent Loans.
- 18 -
*5. |
Balance of Restructured Loans, which is included in Loans and Bills Discounted, is as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Restructured Loans |
256,429 | 311,710 |
Restructured Loans represent loans whose contracts were amended in favor of obligors (e.g. reduction of, or exemption from, stated interest, deferral of interest payments, extension of maturity dates and renunciation of claims) in order to assist or facilitate the restructuring of the obligors. Loans to Bankrupt Obligors, Non-Accrual Delinquent Loans and Loans Past Due for Three Months or More are not included.
*6. |
Total balance of Loans to Bankrupt Obligors, Non-Accrual Delinquent Loans, Loans Past Due for Three Months or More, and Restructured Loans is as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Total |
674,853 | 757,496 |
The amounts given in *3 through *6 above are gross amounts before deduction of amounts for the Reserves for Possible Losses on Loans.
*7. |
In accordance with Accounting and Auditing Treatment Relating to Adoption of Accounting Standards for Financial Instruments for Banks (JICPA Industry Audit Committee Report No. 24, February 13, 2002), bills discounted are accounted for as financing transactions. The banking subsidiaries have rights to sell or pledge these commercial bills, foreign exchange bills purchased and others. The face values of these bills are as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
1,341,367 | 1,506,793 |
- 19 -
*8. |
Breakdown of assets pledged as collateral is as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
The following assets are pledged as collateral: |
||||||||
Trading Assets |
1,281,698 | 3,999,815 | ||||||
Securities |
5,551,273 | 7,332,423 | ||||||
Loans and Bills Discounted |
3,584,065 | 10,317,944 | ||||||
|
|
|
|
|||||
Total |
10,417,037 | 21,650,183 | ||||||
The following liabilities are collateralized by the above assets: |
||||||||
Deposits |
1,057,282 | 897,471 | ||||||
Payables under Repurchase Agreements |
5,479,619 | 5,834,309 | ||||||
Guarantee Deposits Received under Securities Lending Transactions |
778,766 | 2,530,502 | ||||||
Borrowed Money |
4,073,507 | 6,208,639 |
In addition to the above, the following items are pledged as collateral in connection with the settlement accounts of foreign and domestic exchange transactions or derivatives transactions and others or as a substitute for margins for futures transactions and others:
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Cash and Due from Banks |
65,745 | 58,225 | ||||||
Trading Assets |
124,676 | 182,628 | ||||||
Securities |
2,454,991 | 3,528,216 | ||||||
Loans and Bills Discounted |
142,757 | 141,975 |
Other Assets includes margins for futures transactions, guarantee deposits, and collateral pledged for financial instruments and others as follows:
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Margins for Futures Transactions |
500,066 | 230,434 | ||||||
Guarantee Deposits |
113,053 | 113,963 | ||||||
Collateral Pledged for Financial Instruments and Others |
1,925,993 | 1,765,477 |
- 20 -
*9. |
Overdraft protection on current accounts and contracts of the commitment line for loans are contracts by which banking subsidiaries are bound to extend loans up to a prearranged amount, at the request of customers, unless the customer is in breach of contract conditions. The unutilized balance of these contracts amounts is as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Unutilized balance |
90,835,753 | 100,471,308 | ||||||
Amount relating to contracts of which the original contractual maturity is one year or less, or which are unconditionally cancelable at any time |
68,937,304 | 75,058,069 |
Since many of these contracts expire without being exercised, the unutilized balance itself does not necessarily affect future cash flows. A provision is included in many of these contracts that entitles the banking subsidiaries to refuse the execution of loans, or reduce the maximum amount under contracts when there is a change in the financial situation, necessity to preserve a claim or other similar reasons. The banking subsidiaries require collateral such as real estate and securities when deemed necessary at the time the contract is entered into. In addition, they periodically monitor customers business conditions in accordance with internally established standards and take necessary measures to manage credit risks such as amendments to contracts.
*10. |
In accordance with the Land Revaluation Law (Proclamation No. 34 dated March 31, 1998), land used for business operations of domestic consolidated banking subsidiaries was revalued. The applicable income taxes on the entire excess of revaluation are included in Deferred Tax Liabilities for Revaluation Reserve for Land under Liabilities, and the remainder, net of applicable income taxes, is stated as Revaluation Reserve for Land included in Net Assets. |
Revaluation date: March 31, 1998
Revaluation method as stated in Article 3, Paragraph 3 of the above law: Land used for business operations was revalued by calculating the value on the basis of the valuation by road rating stipulated in Article 2, Paragraph 4 of the Enforcement Ordinance relating to the Land Revaluation Law (Government Ordinance No. 119 promulgated on March 31, 1998) with reasonable adjustments to compensate for sites with long depth and other factors, and also on the basis of the appraisal valuation stipulated in Paragraph 5.
*11. |
Accumulated Depreciation of Tangible Fixed Assets |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Accumulated Depreciation |
894,792 | 897,854 |
*12. |
Borrowed Money includes subordinated borrowed money with a covenant that performance of the obligation is subordinated to that of other obligations. |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Subordinated Borrowed Money |
168,000 | 198,000 |
- 21 -
*13. |
Bonds and Notes includes subordinated bonds. |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Subordinated Bonds |
3,594,804 | 3,820,534 |
14. |
The principal amounts of money trusts with contracts indemnifying the principal amounts, which are entrusted to domestic consolidated trust banking subsidiaries, are as follows: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Money trusts |
883,781 | 839,565 |
*15. |
Liabilities for guarantees on corporate bonds included in Securities, which are issued by private placement (Article 2, Paragraph 3 of the Financial Instruments and Exchange Act) |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
|
1,548,136 | 1,468,519 |
- 22 -
Notes to Interim Consolidated Statement of Income
*1. |
Other Ordinary Income includes the following: |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Gains on Sales of Stocks |
86,698 | 44,129 | ||||||
Share of profit of entities accounted for using equity method |
19,109 | 11,559 |
*2. |
Other Ordinary Expenses includes the following: |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Provision for Reserves for Possible Losses on Loans |
7,387 | 76,704 | ||||||
Impairment Losses of Stocks |
10,030 | 62,682 | ||||||
Stock-related Derivatives Expenses |
8,246 | 26,929 | ||||||
Losses on Sales of Stocks |
21,004 | 24,008 |
*3. |
Extraordinary Gains includes the following: |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Accumulation (Amortization) of Unrecognized Prior Service Cost |
| 62,004 | ||||||
Gains on Cancellation of Employee Retirement Benefit Trust |
| 7,895 |
Accumulation (Amortization) of Unrecognized Prior Service Cost resulted from prior service cost incurred in connection with the revision of the retirement benefit plan.
*4. |
Extraordinary Losses is as follows: |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Losses on Transfer to Defined Contribution Pension Plan |
| 3,320 | ||||||
Losses on Disposition of Fixed Assets |
2,242 | 2,243 | ||||||
Losses on Impairment of Fixed Assets |
4,010 | 1,391 |
Losses on Transfer to Defined Contribution Pension Plan resulted from the transfer of part of the defined benefit pension plan to the defined contribution pension plan.
- 23 -
Notes to Interim Consolidated Statement of Changes in Net Assets
For the six months ended September 30, 2019
1. |
Types and number of issued shares and of treasury stock are as follows: |
(Thousands of shares) | ||||||||||||||||||||
As of
April 1, 2019 |
Increase during
the period |
Decrease during
the period |
As of
September 30, 2019 |
Remarks | ||||||||||||||||
Issued Shares |
||||||||||||||||||||
Common Stock |
25,392,498 | | | 25,392,498 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
25,392,498 | | | 25,392,498 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Treasury Stock |
||||||||||||||||||||
Common Stock |
33,962 | 11,788 | 11,273 | 34,477 | (Note | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
33,962 | 11,788 | 11,273 | 34,477 | ||||||||||||||||
|
|
|
|
|
|
|
|
(Note) | Increases are due to acquisition of treasury stock by BBT trust account (9,030 thousand shares), and repurchase of shares constituting less than one unit and other factors (2,758 thousand shares). Decreases are due to distribution and sale of treasury stock through BBT trust account (8,303 thousand shares), exercise of stock acquisition rights (stock options) (2,968 thousand shares) and other factors. The number of shares as of September 30, 2019 includes the number of treasury stock held by BBT trust account (19,643 thousand shares). |
2. |
Stock acquisition rights and treasury stock acquisition rights are as follows: |
Category |
Breakdown of stock acquisition rights |
Class of shares
to be issued or transferred upon exercise of stock acquisition rights |
Number of shares to be issued or transferred upon
exercise of stock acquisition rights (Shares) |
Balance as of
September 30, 2019 (Millions of yen) |
Remarks | |||||||||||||||||||||||||
As of
April 1, 2019 |
Increase
during the period |
Decrease
during the period |
As of
September 30, 2019 |
|||||||||||||||||||||||||||
MHFG |
Stock acquisition rights (Treasury stock acquisition rights) | |
|
( |
) |
|
( |
) |
|
( |
) |
|
( |
) |
|
( |
) |
|||||||||||||
Stock acquisition rights as stock option | | 213 | ||||||||||||||||||||||||||||
Consolidated subsidiaries (Treasury stock acquisition rights) |
|
|
( |
) |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||
Total |
|
|
213
( |
) |
||||||||||||||||||||||||||
|
|
- 24 -
3. |
Cash dividends distributed by MHFG are as follows: |
(1) |
Cash dividends paid during the six months ended September 30, 2019 |
Resolution |
Type |
Cash Dividends (Millions of yen) |
Cash
Dividends per Share (Yen) |
Record Date |
Effective Date |
|||||||||
May 15, 2019
The Board of Directors |
Common Stock | 95,197 | 3.75 | March 31, 2019 | June 4, 2019 |
(Notes) | 1. | Cash dividends based on the resolution of the Board of Directors held on May 15, 2019 include ¥70 million of cash dividends on treasury stock held by BBT trust account. | ||
2. | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Cash Dividends per Share is recorded at the amount before the share consolidation. |
(2) |
Cash dividends with record dates falling in the six months ended September 30, 2019 and effective dates coming after the end of the period |
Resolution |
Type |
Cash Dividends (Millions of yen) |
Resource of Dividends |
Cash
Dividends per Share (Yen) |
Record Date |
Effective Date |
||||||||
November 14, 2019
The Board of Directors |
Common Stock | 95,208 | Retained Earnings | 3.75 | September 30, 2019 | December 6, 2019 |
(Notes) | 1. | Cash dividends based on the resolution of the Board of Directors held on November 14, 2019 include ¥73 million of cash dividends on treasury stock held by BBT trust account. | ||
2. | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Cash Dividends per Share is recorded at the amount before the share consolidation. |
- 25 -
For the six months ended September 30, 2020
1. |
Types and number of issued shares and of treasury stock are as follows: |
(Thousands of shares) | ||||||||||||||||||||
As of
April 1, 2020 |
Increase during
the period |
Decrease during
the period |
As of
September 30, 2020 |
Remarks | ||||||||||||||||
Issued Shares |
||||||||||||||||||||
Common Stock |
25,392,498 | | | 25,392,498 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
25,392,498 | | | 25,392,498 | ||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Treasury Stock |
||||||||||||||||||||
Common Stock |
32,106 | 14,344 | 7,768 | 38,683 | (Note | ) | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||
Total |
32,106 | 14,344 | 7,768 | 38,683 | ||||||||||||||||
|
|
|
|
|
|
|
|
(Note) |
Increases are due to acquisition of treasury stock by BBT trust account (10,958 thousand shares), and repurchase of shares constituting less than one unit and other factors (3,386 thousand shares). Decreases are due to distribution and sale of treasury stock through BBT trust account (5,030 thousand shares), exercise of stock acquisition rights (stock options) (420 thousand shares) and other factors. The number of shares as of September 30, 2020 includes the number of treasury stock held by BBT trust account (25,564 thousand shares). |
2. |
Stock acquisition rights and treasury stock acquisition rights are as follows: |
Category |
Breakdown of stock acquisition rights |
Class of shares
to be issued or transferred upon exercise of stock acquisition rights |
Number of shares to be issued or transferred upon
exercise of stock acquisition rights (Shares) |
Balance as of
September 30, 2020 (Millions of yen) |
Remarks | |||||||||||||||||||||||||
As of
April 1, 2020 |
Increase
during the period |
Decrease
during the period |
As of
September 30, 2020 |
|||||||||||||||||||||||||||
MHFG |
Stock acquisition rights (Treasury stock acquisition rights) | |
|
( |
) |
|
( |
) |
|
( |
) |
|
( |
) |
|
( |
) |
|||||||||||||
Stock acquisition rights as stock option | | 134 | ||||||||||||||||||||||||||||
Consolidated subsidiaries (Treasury stock acquisition rights) |
|
|
( |
) |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||||
Total |
|
|
134
( |
) |
||||||||||||||||||||||||||
|
|
- 26 -
3. |
Cash dividends distributed by MHFG are as follows: |
(1) |
Cash dividends paid during the six months ended September 30, 2020 |
Resolution |
Type |
Cash Dividends (Millions of yen) |
Cash Dividends per Share (Yen) |
Record Date |
Effective Date |
|||||||
May 15, 2020
The Board of Directors |
Common Stock | 95,208 | 3.75 | March 31, 2020 | June 8, 2020 |
(Notes) |
1. | Cash dividends based on the resolution of the Board of Directors held on May 15, 2020 include ¥73 million of cash dividends on treasury stock held by BBT trust account. | ||
2. | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Cash Dividends per Share is recorded at the amount before the share consolidation. |
(2) |
Cash dividends with record dates falling in the six months ended September 30, 2020 and effective dates coming after the end of the period |
Resolution |
Type |
Cash Dividends (Millions of yen) |
Resource of
|
Cash Dividends per Share (Yen) |
Record Date |
Effective Date |
||||||
November 12, 2020
The Board of Directors |
Common Stock | 95,209 | Retained Earnings | 3.75 | September 30, 2020 | December 7, 2020 |
(Notes) |
1. | Cash dividends based on the resolution of the Board of Directors held on November 12, 2020 include ¥95 million of cash dividends on treasury stock held by BBT trust account. | ||
2. | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Cash Dividends per Share is recorded at the amount before the share consolidation. |
Notes to Interim Consolidated Statement of Cash Flows
*1. |
Cash and Cash Equivalents at the end of the period on the Interim Consolidated Statement of Cash Flows reconciles to Cash and Due from Banks on the Interim Consolidated Balance Sheet as follows: |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Cash and Due from Banks |
43,444,902 | 42,498,278 | ||||||
Due from Banks excluding central banks |
(903,852 | ) | (1,125,902 | ) | ||||
|
|
|
|
|||||
Cash and Cash Equivalents |
42,541,050 | 41,372,376 | ||||||
|
|
|
|
- 27 -
Lease Transactions
1. |
Finance Leases (Lessees) |
Finance lease transactions that do not transfer ownership:
1) |
Lease Assets: |
(a) |
Tangible fixed assets: mainly equipment |
(b) |
Intangible fixed assets: software |
2) |
The method for computing the amount of depreciation is described in 4. Standards of Accounting Method (5) Depreciation of Fixed Assets. |
2. |
Operating Leases |
The future lease payments subsequent to the end of the fiscal year for non-cancelable operating lease transactions are summarized as follows:
(1) |
Lessees: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Due in One Year or Less |
51,062 | 53,852 | ||||||
Due after One Year |
241,446 | 277,002 | ||||||
|
|
|
|
|||||
Total |
292,508 | 330,855 | ||||||
|
|
|
|
(2) |
Lessors: |
(Millions of yen) | ||||||||
As of March 31, 2020 | As of September 30, 2020 | |||||||
Due in One Year or Less |
790 | 1,070 | ||||||
Due after One Year |
6,867 | 7,896 | ||||||
|
|
|
|
|||||
Total |
7,657 | 8,967 | ||||||
|
|
|
|
- 28 -
Financial Instruments
1. |
Matters relating to fair value of financial instruments and others |
The following are the interim consolidated balance sheet amounts (the consolidated balance sheet amounts), fair values and differences between them. Stocks and others without a quoted market price and Investments in Partnerships and others are excluded from the table below (see (Note 1)). In addition, notes concerning Cash and Due from Banks, Call Loans and Bills Purchased, Receivables under Resale Agreements, Guarantee Deposits Paid under Securities Borrowing Transactions, Call Money and Bills Sold, Payables under Repurchase Agreements, Guarantee Deposits Received under Securities Lending Transactions, and Due to Trust Accounts are omitted since these instruments are mainly settled in the short term and the fair values approximate the book values.
As of March 31, 2020
(Millions of yen) | ||||||||||||
Consolidated Balance
Sheet Amount |
Fair Value | Difference | ||||||||||
(1) Other Debt Purchased |
2,688,273 | 2,688,383 | 109 | |||||||||
(2) Trading Assets |
||||||||||||
Trading Securities |
5,377,182 | 5,377,182 | | |||||||||
(3) Money Held in Trust |
409,524 | 409,524 | | |||||||||
(4) Securities |
||||||||||||
Bonds Held to Maturity |
860,233 | 875,329 | 15,096 | |||||||||
Other Securities |
33,026,789 | 33,026,789 | | |||||||||
(5) Loans and Bills Discounted |
83,468,185 | |||||||||||
Reserves for Possible Losses on Loans (*1) |
(386,686 | ) | ||||||||||
|
|
|
|
|
|
|||||||
83,081,498 | 84,254,484 | 1,172,985 | ||||||||||
|
|
|
|
|
|
|||||||
Total Assets |
125,443,502 | 126,631,694 | 1,188,191 | |||||||||
|
|
|
|
|
|
|||||||
(1) Deposits |
131,189,673 | 131,196,960 | 7,287 | |||||||||
(2) Negotiable Certificates of Deposit |
13,282,561 | 13,281,929 | (632 | ) | ||||||||
(3) Trading Liabilities |
||||||||||||
Securities Sold, Not yet Purchased |
2,213,074 | 2,213,074 | | |||||||||
(4) Borrowed Money |
5,209,947 | 5,148,053 | (61,894 | ) | ||||||||
(5) Bonds and Notes |
8,906,432 | 8,847,784 | (58,647 | ) | ||||||||
|
|
|
|
|
|
|||||||
Total Liabilities |
160,801,689 | 160,687,801 | (113,887 | ) | ||||||||
|
|
|
|
|
|
- 29 -
(Millions of yen) | ||||||||||||
Consolidated Balance
Sheet Amount |
Fair Value | Difference | ||||||||||
Derivative Transactions (*2) |
||||||||||||
Derivative Transactions not Qualifying for Hedge Accounting |
367,402 | |||||||||||
Derivative Transactions Qualifying for Hedge Accounting |
357,953 | |||||||||||
|
|
|
|
|
|
|||||||
Total Derivative Transactions |
725,356 | 725,356 | | |||||||||
|
|
|
|
|
|
(*1) |
General and specific reserves for possible losses on loans relevant to Loans and Bills Discounted are excluded. |
(Change in Presentation)
While the reserves for items other than Loans and Bills Discounted were directly written off against the consolidated balance sheet amounts due to immateriality in the fiscal year ended March 31, 2020, these items are recorded at the consolidated balance sheet amounts without write-off of the reserves from the interim period ended September 30, 2020.
(*2) |
Derivative Transactions recorded in Trading Assets, Trading Liabilities, Derivatives other than for Trading Assets, Derivatives other than for Trading Liabilities, and others are presented as a lump sum. |
Net claims and debts that arose from derivative transactions are presented on a net basis, and the item that is net debts in total is presented in brackets.
- 30 -
As of September 30, 2020
(Millions of yen) | ||||||||||||
Interim Consolidated
Balance Sheet Amount |
Fair Value | Difference | ||||||||||
(1) Other Debt Purchased |
2,676,047 | 2,676,228 | 180 | |||||||||
(2) Trading Assets |
||||||||||||
Trading Securities |
7,798,622 | 7,798,622 | | |||||||||
(3) Money Held in Trust |
469,518 | 469,518 | | |||||||||
(4) Securities |
||||||||||||
Bonds Held to Maturity |
788,395 | 812,148 | 23,753 | |||||||||
Other Securities |
41,297,399 | 41,297,399 | | |||||||||
(5) Loans and Bills Discounted |
86,501,633 | |||||||||||
Reserves for Possible Losses on Loans (*1) |
(437,494 | ) | ||||||||||
|
|
|
|
|
|
|||||||
86,064,138 | 87,273,084 | 1,208,946 | ||||||||||
|
|
|
|
|
|
|||||||
Total Assets |
139,094,121 | 140,327,002 | 1,232,880 | |||||||||
|
|
|
|
|
|
|||||||
(1) Deposits |
134,665,825 | 134,679,962 | 14,136 | |||||||||
(2) Negotiable Certificates of Deposit |
14,201,308 | 14,201,351 | 42 | |||||||||
(3) Trading Liabilities |
||||||||||||
Securities Sold, Not yet Purchased |
2,339,729 | 2,339,729 | | |||||||||
(4) Borrowed Money |
7,275,166 | 7,264,578 | (10,587 | ) | ||||||||
(5) Bonds and Notes |
9,639,781 | 9,878,597 | 238,815 | |||||||||
|
|
|
|
|
|
|||||||
Total Liabilities |
168,121,811 | 168,364,219 | 242,407 | |||||||||
|
|
|
|
|
|
|||||||
Derivative Transactions (*2) |
||||||||||||
Derivative Transactions not Qualifying for Hedge Accounting |
376,295 | |||||||||||
Derivative Transactions Qualifying for Hedge Accounting |
261,065 | |||||||||||
|
|
|
|
|
|
|||||||
Total Derivative Transactions |
637,360 | 637,360 | | |||||||||
|
|
|
|
|
|
(*1) |
General and specific reserves for possible losses on loans relevant to Loans and Bills Discounted are excluded. Items other than Loans and Bills Discounted are recorded at the interim consolidated balance sheet amounts due to immateriality of their reserves. |
(*2) |
Derivative Transactions recorded in Trading Assets, Trading Liabilities, Derivatives other than for Trading Assets, Derivatives other than for Trading Liabilities, and others are presented as a lump sum. |
Net claims and debts that arose from derivative transactions are presented on a net basis, and the item that is net debts in total is presented in brackets.
- 31 -
(Note 1) |
The following are the interim consolidated balance sheet amounts (the consolidated balance sheet amounts) of Stocks and others without a quoted market price, and Investments in Partnerships and others. These amounts are not included in Money Held in Trust and Other Securities in fair value information of financial instruments. |
(Millions of yen) |
||||||||
Category |
As of March 31, 2020 | As of September 30, 2020 | ||||||
Stocks and others without a quoted market price (*1) |
451,348 | 634,234 | ||||||
Investments in Partnerships and others (*2) |
238,797 | 256,431 |
*1 |
Stocks and others without a quoted market price include unlisted stocks and others and in accordance with Article 5 of Implementation Guidance on Disclosures about Fair Value of Financial Instruments (ASBJ Guidance No.19, July 4, 2019), these items are not subject to disclosure of the fair value. |
*2 |
Investments in Partnerships and others are mainly silent partnership, investment partnership, and money held in trust with the investment in a silent partnership as the component of the trust property. In accordance with Article 27 of Implementation Guidance on Accounting Standard for Fair Value Measurement (ASBJ Guidance No.31, July 4, 2019), these items are not subject to disclosure of the fair value. |
3 |
During the fiscal year ended March 31, 2020, the amount of impairment (devaluation) was ¥2,221 million on a consolidated basis. During the six months ended September 30, 2020, the amount of impairment (devaluation) was ¥1,780 million on a consolidated basis. |
2. |
Matters relating to breakdown of fair value of financial instruments by level |
Fair values of financial instruments are categorized into three levels as below on the basis of the observability and the materiality of the valuation inputs used in fair value measurements.
Fair values of Level 1: Fair values measured by quoted prices of the assets or liabilities being measured which are given in active markets among observable valuation inputs
Fair values of Level 2: Fair values measured by inputs other than inputs included within Level 1 among observable valuation inputs
Fair values of Level 3: Fair values measured by unobservable valuation inputs
When several inputs that have significant impact on fair value measurement are used and those inputs are categorized into different levels, the fair value is categorized into the lowest priority level for fair value measurement among the levels in which each of the inputs belongs.
- 32 -
(1) |
Financial instruments recorded at fair value in the interim consolidated balance sheet |
As of September 30, 2020
(Millions of yen) | ||||||||||||||||
Category |
Fair Value | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Other Debt Purchased |
| 50,322 | 207,558 | 257,880 | ||||||||||||
Trading Assets |
||||||||||||||||
Trading Securities |
||||||||||||||||
Japanese Government Bonds |
3,141,936 | 10,640 | | 3,152,577 | ||||||||||||
Japanese Local Government Bonds |
| 129,250 | | 129,250 | ||||||||||||
Japanese Corporate Bonds |
2,268 | 1,477,064 | 798 | 1,480,132 | ||||||||||||
Stocks |
132,496 | | 225 | 132,722 | ||||||||||||
Other |
766,015 | 1,891,751 | 78,154 | 2,735,920 | ||||||||||||
Money Held in Trust |
| 463,260 | 3 | 463,263 | ||||||||||||
Securities |
||||||||||||||||
Other Securities |
||||||||||||||||
Stocks |
2,573,746 | | 8,052 | 2,581,799 | ||||||||||||
Japanese Government Bonds |
19,600,482 | 319,880 | | 19,920,362 | ||||||||||||
Japanese Local Government Bonds |
| 407,183 | | 407,183 | ||||||||||||
Japanese Corporate Bonds |
| 635,737 | 2,144,487 | 2,780,224 | ||||||||||||
Foreign Bonds |
6,312,706 | 6,109,046 | 877,711 | 13,299,464 | ||||||||||||
Other |
43,822 | 2,756 | 15,868 | 62,447 | ||||||||||||
Derivative Transactions |
||||||||||||||||
Interest Rate and Bond-Related Transactions |
23,041 | 6,134,610 | 16,301 | 6,173,952 | ||||||||||||
Currency-Related Transactions |
| 2,123,994 | 20,925 | 2,144,920 | ||||||||||||
Stocks-Related Transactions |
95,299 | 286,614 | 74,522 | 456,436 | ||||||||||||
Commodity-Related Transactions |
| 11,293 | 15,221 | 26,515 | ||||||||||||
Credit Derivative Transactions |
| 52,836 | 4,234 | 57,071 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Assets |
32,691,816 | 20,106,243 | 3,464,066 | 56,262,125 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Trading Liabilities |
||||||||||||||||
Securities Sold, Not yet Purchased |
1,871,259 | 258,637 | 19,574 | 2,149,472 | ||||||||||||
Derivative Transactions |
||||||||||||||||
Interest Rate and Bond-Related Transactions |
19,189 | 5,688,575 | 10,702 | 5,718,467 | ||||||||||||
Currency-Related Transactions |
| 2,157,441 | 1,219 | 2,158,661 | ||||||||||||
Stocks-Related Transactions |
110,016 | 109,143 | 24,831 | 243,992 | ||||||||||||
Commodity-Related Transactions |
1,093 | 7,836 | 14,088 | 23,018 | ||||||||||||
Credit Derivative Transactions |
| 75,182 | 2,214 | 77,396 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
Total Liabilities |
2,001,558 | 8,296,817 | 72,631 | 10,371,007 | ||||||||||||
|
|
|
|
|
|
|
|
(*) |
Investment trust and others applying the transitional measures set forth in Article 6, Item 6 of Cabinet Office Ordinance for Partial Revision of the Ordinance on the Terminology, Forms, and Preparation Methods of the financial statements (Cabinet Office Ordinance No. 9 March 6, 2020) are not included in above table. The financial assets and liabilities of the relevant investment trust and others in the interim consolidated balance sheet is ¥2,413,937 million and ¥190,256 million. |
- 33 -
(2) |
Financial instruments other than financial instruments recorded at fair value in the interim consolidated balance sheet |
As of September 30, 2020
(Millions of yen) | ||||||||||||||||
Category |
Fair Value | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Other Debt Purchased |
| 9,515 | 2,408,831 | 2,418,347 | ||||||||||||
Money Held in Trust |
| | 6,254 | 6,254 | ||||||||||||
Securities |
||||||||||||||||
Bonds Held to Maturity |
||||||||||||||||
Japanese Government Bonds |
491,452 | | | 491,452 | ||||||||||||
Foreign Bonds |
| 320,696 | | 320,696 | ||||||||||||
Loans and Bills Discounted |
| | 87,273,084 | 87,273,084 | ||||||||||||
Total Assets |
491,452 | 330,212 | 89,688,171 | 90,509,835 | ||||||||||||
Deposits |
| 134,679,962 | | 134,679,962 | ||||||||||||
Negotiable Certificates of Deposit |
| 14,201,351 | | 14,201,351 | ||||||||||||
Borrowed Money |
| 7,179,075 | 85,503 | 7,264,578 | ||||||||||||
Bonds and Notes |
| 9,147,421 | 731,175 | 9,878,597 | ||||||||||||
Total Liabilities |
| 165,207,810 | 816,679 | 166,024,489 |
- 34 -
(Note 1) |
Explanation of valuation techniques and valuation inputs used in fair value measurements |
Assets
Other Debt Purchased
Fair values of securitized products of other debt purchased are based on the values deemed as market prices obtained by the reasonable estimate such as those obtained from brokers and financial information vendors and are categorized as Level 3 when significant unobservable valuation inputs are used for the obtained price and as Level 2 when other inputs are used.
With respect to other debt purchased other than those described above, when the present values of the expected future cash flows are considered to be fair values, those other debt purchased are mainly categorized as Level 3 since the discount rate and other significant valuation inputs are unobservable. When those are short term in nature and the book values are considered to be fair values, those other debt purchased are categorized as Level 3.
Trading Assets
Fair values of trading assets for which unadjusted quoted market prices in active markets are available are categorized as Level 1, which includes mainly government bonds.
In the case the market is inactive even if the quoted market price is available, those trading assets are categorized as Level 2, which includes mainly local government bonds and corporate bonds.
When fair vales are measured at the present value of the expected future cash flows and others using significant unobservable inputs, those trading assets are categorized as Level 3, which includes mainly bonds with warrants and trust beneficiary rights.
Money Held in Trust
With respect to securities managed as trust assets in a directed money trust for separate investment with the management of securities as its primary purpose, fair values of stocks are measured at the price in stock exchanges and bonds are measured at market price or valuation price obtained from brokers or financial information vendors and are categorized as Level 2 or Level 3 based on the level of components.
The notes to Money Held in Trust based on holding purpose are stated in Money Held in Trust.
Securities
Fair values of securities for which unadjusted quoted market prices in active markets are available are categorized as Level 1 which includes mainly stocks and government bonds. In the case the market is inactive even if the quoted market price is available, those securities are categorized as Level 2, which includes mainly local government bonds and corporate bonds.
Fair values of investment trusts are measured at the disclosed net asset value and others. Those are not categorized into Levels by applying the transitional measures set forth in Article 26 of Implementation Guidance on Accounting Standard for Fair Value Measurements.
Fair values of private placement bonds are measured by discounting the total amount of principal and interest and others at interest rates based on the discount rate reflecting expected loss and various risk factors by categories based on the internal ratings and terms and are categorized as Level 3 since the discount rate is unobservable.
Fair values of securitized products are based on valuations obtained from brokers and others, and reasonably measured prices based on the reasonable estimates of our management and are categorized as Level 3 when significant unobservable valuation inputs are used and as Level 2 when other inputs are used. In deriving reasonably measured prices based on the reasonable estimates of our management mentioned above, we used the discounted cash flow method. The price decision variables include default rates, recovery rates, prepayment rates, and discount rates.
The notes to Securities based on holding purpose are stated in Securities.
Loans and Bills Discounted
Fair values of loans and bills discounted are measured by discounting the total amount of principal and interest and others at interest rates based on the discount rate reflecting expected loss and various risk factors by categories according to the types, internal ratings and terms of the loans and bills discounted and are categorized as Level 3 since the discount rate is unobservable.
In addition, fair values of claims against bankrupt obligors, substantially bankrupt obligors, and intensive control obligors whose bad debts are measured at the present value of the expected future cash flows or the estimated amounts calculated based on the recoverability from collateral and guarantees approximate the amount of claims and others minus the amount of reserves for possible losses on loans in the interim consolidated balance sheet (the consolidated balance sheet) as of the interim consolidated balance sheet date (the consolidated balance sheet date) and those amount are considered to be fair values which are categorized as Level 3.
- 35 -
Among the loans and bills discounted, for those without a fixed maturity due to loan characteristics such as limiting loans to within the value of pledged assets, book values are considered to be fair values since fair values are expected to approximate book values based on the estimated loan periods, interest rates and other conditions. Fair values of those loans and bills discounted are categorized as Level 3.
Liabilities
Deposits and Negotiable Certificates of Deposit
For demand deposits, the payment amounts required on the interim consolidated balance sheet date (the consolidated balance sheet date) (i.e., book values) are considered to be fair values.
In addition, fair values of time deposits and negotiable certificates of deposits are calculated by classifying them based on their terms and by discounting the future cash flows. The discount rates used in such calculations are the market interest rates. Since fair values of those whose deposit terms are short (i.e., within six months) approximate book values, the book values are considered to be fair values and those fair values are categorized as Level 2.
Trading Liabilities
Fair values of trading liabilities for which unadjusted quoted market prices in active markets are available are categorized as Level 1, which includes mainly listed stocks and government bonds.
In the case the market is inactive even if the quoted market price is available, those trading liabilities are categorized as Level 2, which includes mainly corporate bonds.
When significant unobservable inputs are used, those trading liabilities are categorized as Level 3.
Borrowed Money
Fair values of borrowed money are measured mainly by discounting the total amount of the principal and interest of such borrowed money classified by period lengths at the interest rates considered to be applicable to similar loans and are categorized as Level 3 when the impact from unobservable valuation inputs is significant and as Level 2 when it is not significant.
Bonds and Notes
With respect to bonds and notes issued by MHFG and its consolidated subsidiaries, fair values of bonds and notes with market prices are measured at the market prices and fair values of those without market prices are calculated by discounting the total amount of the principal and interest at the interest rates considered to be applicable to similar bonds and notes. Bonds and notes with market prices are categorized as Level 2. Those without market prices are categorized as Level 3 when the impact from unobservable valuation inputs is significant and as Level 2 when it is not significant.
Derivative Transactions
Derivative transactions that can be measured at unadjusted quoted prices in active markets are categorized as Level 1, which includes such transactions as bonds futures and interest rate futures.
However, since most derivative transactions are over-the-counter transactions and there are no quoted market prices, market values are measured using valuation techniques such as the discounted cash flow method and the Black-Scholes model, depending on the type of transaction and the maturity period. The main inputs which are used in those valuation techniques are interest rate, currency rate, volatility and others. In addition, price adjustments based on counterpartys credit risk and consolidated subsidiarys own credit risk and price adjustments for unsecured funding are made. When unobservable inputs are not used or impact of unobservable inputs are not material, transactions are categorized as Level 2, which includes such transactions as plain vanilla interest rate swaps and foreign exchange forwards. When significant unobservable inputs are used, transactions are categorized as Level 3, which includes transactions such as commodity related transactions.
- 36 -
(Note 2) |
Information relating to fair values of Level 3 among the financial instruments recorded at fair value in the interim consolidated balance sheet |
(1) |
Quantitative information of significant unobservable valuation inputs |
As of September 30, 2020
Category |
Principal valuation
|
Significant unobservable
|
Range of
valuation
|
Weighted average |
||||||||
Other Debt Purchased |
||||||||||||
Securitized products |
Discounted cash flow method | Prepayment rate | 0.9% 15.6% | 6.2% | ||||||||
Default rate | 0.0% 1.1% | 0.8% | ||||||||||
Discount rate | 0.0% 1.7% | 0.3% | ||||||||||
Trading Assets |
||||||||||||
Trading Securities |
Discounted cash flow method | Discount rate | 0.9% 6.9% | 4.4% | ||||||||
Securities |
||||||||||||
Japanese Corporate Bonds |
||||||||||||
Private placement bonds |
Discounted cash flow method | Discount rate | 0.0% 6.5% | 0.7% | ||||||||
Foreign Bonds |
||||||||||||
Securitized products |
Discounted cash flow method | Prepayment rate | 5.2% 22.1% | 21.9% | ||||||||
Default rate | 0.4% 2.5% | 1.2% | ||||||||||
Recovery rate | 10.0% 69.1% | 67.1% | ||||||||||
Discount rate | 0.5% 1.7% | 1.4% | ||||||||||
Other |
Discounted cash flow method | Discount rate | 0.0% 5.0% | 0.3% | ||||||||
Trading Liabilities |
||||||||||||
Securities Sold, Not yet Purchased |
Discounted cash flow method | Discount rate | 1.5% | 1.5% | ||||||||
Derivative Transactions |
||||||||||||
Interest Rate and Bond-Related Transactions |
Option valuation model | IR IR correlation | 23.1% 100.0% | | ||||||||
Default rate | 0.0% 62.6% | | ||||||||||
Currency-Related Transactions |
Option valuation model | FX IR correlation | (26.6)% 51.7% | | ||||||||
FX FX correlation | 46.0% 63.2% | | ||||||||||
Default rate | 0.0% 62.6% | | ||||||||||
Stocks-Related Transactions |
Option valuation model | Equity IR correlation | 25.0% | | ||||||||
Equity FX correlation | (32.5)% 100.0% | | ||||||||||
Equity correlation | 0.0% 100.0% | | ||||||||||
Equity volatility | 11.6% 96.2% | | ||||||||||
Commodity-Related Transactions |
Option valuation model | Commodity volatility | 0.0% 57.0% | | ||||||||
Credit Derivative Transactions |
Discounted cash flow method | Default rate | 0.0% 6.9% | | ||||||||
Credit correlation | 18.1% 100.0% | |
- 37 -
(2) |
Adjustment sheet from beginning balance to ending balance as of interim period and unrealized gains (losses) recognized as gains (losses) for the period |
As of September 30, 2020
(Millions of yen) | ||||||||||||||||||||||||||||||||
Beginning
balance |
Gains(losses) for the period/ other
|
Net amount
of purchase, sale, issue, and settlement |
Transfer to
fair values of Level 3 (*3) |
Transfer from
fair values of Level 3 (*4) |
Ending
balance as of interim period |
Unrealized
gains (losses) on financial assets and liabilities held as of the interim consolidated balance sheet date among the amount recorded to gains (losses) for the period (*1) |
||||||||||||||||||||||||||
Recorded to
gains(losses) for the period (*1) |
Recorded to other
comprehensive income (*2) |
|||||||||||||||||||||||||||||||
Other Debt Purchased |
151,219 | (1 | ) | 468 | 55,871 | | | 207,558 | | |||||||||||||||||||||||
Trading Assets |
||||||||||||||||||||||||||||||||
Trading Securities |
||||||||||||||||||||||||||||||||
Japanese Corporate Bonds |
797 | 1 | | | | | 798 | 1 | ||||||||||||||||||||||||
Stocks |
206 | | | 19 | | | 225 | (172 | ) | |||||||||||||||||||||||
Other |
156,666 | 947 | | (78,461 | ) | | (999 | ) | 78,154 | 761 | ||||||||||||||||||||||
Money Held in Trust |
3 | | (0 | ) | 0 | | | 3 | | |||||||||||||||||||||||
Securities |
||||||||||||||||||||||||||||||||
Other Securities |
||||||||||||||||||||||||||||||||
Stocks |
6,317 | | 284 | 1,450 | | | 8,052 | | ||||||||||||||||||||||||
Japanese Corporate Bonds |
2,201,133 | (1,205 | ) | 4,020 | (59,462 | ) | | | 2,144,487 | | ||||||||||||||||||||||
Foreign Bonds |
847,601 | 456 | 23,178 | 6,474 | | | 877,711 | | ||||||||||||||||||||||||
Other |
18,663 | (1,226 | ) | (308 | ) | (1,260 | ) | | | 15,868 | | |||||||||||||||||||||
Trading Liabilities |
||||||||||||||||||||||||||||||||
Securities Sold, Not yet Purchased |
232 | (19 | ) | | 19,362 | | | 19,574 | | |||||||||||||||||||||||
Derivative Transactions |
||||||||||||||||||||||||||||||||
Interest Rate and Bond-Related Transactions |
7,696 | (8,862 | ) | | 6,765 | | | 5,598 | (6,441 | ) | ||||||||||||||||||||||
Currency-Related Transactions |
16,277 | 4,177 | | (748 | ) | | | 19,706 | 5,361 | |||||||||||||||||||||||
Stocks-Related Transactions |
69,571 | (27,236 | ) | | 7,355 | | | 49,690 | (12,925 | ) | ||||||||||||||||||||||
Commodity-Related Transactions |
1,240 | 182 | | (289 | ) | | | 1,133 | (325 | ) | ||||||||||||||||||||||
Credit Derivative Transactions |
3,516 | (1,790 | ) | | 6 | 1,052 | (764 | ) | 2,020 | (2,660 | ) |
- 38 -
(*1) |
Those amounts are included in Other Operating Income and Other Operating Expenses in the interim consolidated statement of income. |
(*2) |
Those amounts are included in Net Unrealized Gains (Losses) on Other Securities of Other Comprehensive Income in the interim consolidated statement of comprehensive income. |
(*3) |
Those are the transfers from Level 2 to Level 3, due to changes in observability of valuation inputs which are used in fair value measurements based on market liquidity. The transfer was made on the beginning of the accounting period. |
(*4) |
Those are the transfers from Level 2 to Level 3, due to changes in observability of valuation inputs which are used in fair value measurements based on market liquidity. The transfer was made on the beginning of the accounting period. |
- 39 -
(3) |
Explanation of the process of fair value measurement |
In MHFG, middle-offices and back-offices have established policies and procedures related to the measurement of fair values and procedures related to usage of the valuation model. For the fair values and the level categories, the validity of the valuation techniques and valuation inputs used in fair value measurement are verified.
In fair value measurement, valuation models in which the nature, characteristics and risks of individual assets are most appropriately reflected are used. In addition, when quoted prices obtained from third parties are used, the validity of the prices is verified by appropriate methods such as confirmation of valuation techniques and used valuation inputs and comparison with the fair values of similar financial instruments.
(4) |
Explanation of the impact on fair values in the case where significant unobservable inputs are varied |
Prepayment rate
The prepayment rate is the estimated rate at which voluntary unscheduled repayments of the principal of the underlying assets are expected to occur. The movement of the prepayment rate is generally negatively correlated with borrower delinquency. A significant change in the prepayment rate would significantly impact the valuation of the fair values of financial instruments either positively or negatively, depending on the structure of financial instruments.
Default rate
The default rate is an estimate of the likelihood of not collecting contractual payments. A significant increase (decrease) in the default rate would generally be accompanied by a decrease (increase) in the recovery rate and an increase (decrease) in the discount rate. It would also generally significantly impact the valuation of the fair values of financial instruments negatively (positively).
Recovery rate
The recovery rate is an estimate of the percentage of contractual payments that would be collected in the event of a default. A significant increase (decrease) in recovery rate would generally be accompanied by a decrease (increase) in the default rate. It would also generally significantly impact the valuation of the fair values of financial instruments positively (negatively).
Discount rate
The discount rate is an adjustment rate to a benchmark market interest rate such as LIBOR or swap rates. It primarily consists of a risk premium component which is the amount of compensation that market participants require due to the uncertainty inherent in the financial instruments cash flows resulting from credit risk. A significant increase (decrease) in discount rate would generally significantly impact the valuation of the fair values of financial instruments negatively (positively).
Correlation
Correlation is the likelihood of the movement of one input relative to another based on an established relationship. A significant change in correlation would significantly impact the valuation of derivatives either positively or negatively, depending on the nature of the underlying assets.
Volatility
Volatility is a measure of the expected change in variables over a fixed period of time. Some financial instruments benefit from an increase in volatility and others benefit from a decrease in volatility. Generally, a significant increase (decrease) in volatility would result in a significant increase (decrease) in option values and, for a long position in an option, it would result in a significant increase (decrease) in the fair values of financial instruments.
- 40 -
Securities
In addition to Securities on the interim consolidated balance sheet (the consolidated balance sheet), Negotiable Certificates of Deposit in Cash and Due from Banks, certain items in Other Debt Purchased and certain items in Other Assets are also included.
1. |
Bonds Held to Maturity |
As of March 31, 2020
(Millions of yen) |
||||||||
Type |
Consolidated Balance Sheet Amount |
Fair Value |
Difference |
|||||
Bonds Whose Fair Values Exceed the Consolidated Balance Sheet Amount |
Japanese Government Bonds | 479,936 | 493,293 | 13,356 | ||||
Foreign Bonds | 263,600 | 265,711 | 2,110 | |||||
|
|
|
||||||
Sub-total |
743,537 | 759,004 | 15,467 | |||||
|
|
|
||||||
Bonds Whose Fair Values Do Not Exceed the Consolidated Balance Sheet Amount |
Japanese Government Bonds | | | | ||||
Foreign Bonds | 116,696 | 116,325 | (370) | |||||
|
|
|
||||||
Sub-total |
116,696 | 116,325 | (370) | |||||
|
|
|
||||||
Total |
860,233 | 875,329 | 15,096 | |||||
|
|
|
||||||
As of September 30, 2020
|
||||||||
(Millions of yen) |
||||||||
Type |
Interim Consolidated Balance Sheet Amount |
Fair Value |
Difference |
|||||
Bonds Whose Fair Values Exceed the Interim Consolidated Balance Sheet Amount |
Japanese Government Bonds | 479,947 | 491,452 | 11,504 | ||||
Foreign Bonds | 308,447 | 320,696 | 12,248 | |||||
|
|
|
||||||
Sub-total |
788,395 | 812,148 | 23,753 | |||||
|
|
|
||||||
Bonds Whose Fair Values Do Not Exceed the Interim Consolidated Balance Sheet Amount |
Japanese Government Bonds | | | | ||||
Foreign Bonds | | | | |||||
|
|
|
||||||
Sub-total |
| | | |||||
|
|
|
||||||
Total |
788,395 | 812,148 | 23,753 | |||||
|
|
|
- 41 -
2. |
Other Securities |
As of March 31, 2020
(Millions of yen) |
||||||||||||||
Type |
Consolidated Balance
Sheet Amount |
Acquisition Cost | Difference | |||||||||||
Other Securities Whose Consolidated Balance Sheet Amount Exceeds Acquisition Cost |
Stocks | 2,021,965 | 854,061 | 1,167,903 | ||||||||||
Bonds |
5,670,266 | 5,640,229 | 30,037 | |||||||||||
Japanese Government Bonds |
4,029,441 | 4,022,901 | 6,540 | |||||||||||
Japanese Local Government Bonds |
73,989 | 73,340 | 649 | |||||||||||
Japanese Corporate Bonds |
1,566,835 | 1,543,988 | 22,847 | |||||||||||
Other |
12,003,615 | 11,657,947 | 345,668 | |||||||||||
Foreign Bonds |
10,833,455 | 10,587,358 | 246,097 | |||||||||||
Other Debt Purchased |
60,832 | 59,442 | 1,389 | |||||||||||
Other |
1,109,326 | 1,011,146 | 98,180 | |||||||||||
|
|
|
|
|
|
|||||||||
Sub-total |
19,695,847 | 18,152,237 | 1,543,609 | |||||||||||
|
|
|
|
|
|
|||||||||
Other Securities Whose Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost |
Stocks | 316,463 | 418,007 | (101,543 | ) | |||||||||
Bonds |
10,032,246 | 10,116,384 | (84,137 | ) | ||||||||||
Japanese Government Bonds |
8,572,492 | 8,623,055 | (50,562 | ) | ||||||||||
Japanese Local Government Bonds |
198,578 | 199,072 | (494 | ) | ||||||||||
Japanese Corporate Bonds |
1,261,175 | 1,294,256 | (33,081 | ) | ||||||||||
Other |
3,293,071 | 3,479,852 | (186,781 | ) | ||||||||||
Foreign Bonds |
1,868,757 | 1,913,900 | (45,142 | ) | ||||||||||
Other Debt Purchased |
140,256 | 140,407 | (150 | ) | ||||||||||
Other |
1,284,056 | 1,425,544 | (141,487 | ) | ||||||||||
|
|
|
|
|
|
|||||||||
Sub-total |
13,641,781 | 14,014,244 | (372,462 | ) | ||||||||||
|
|
|
|
|
|
|||||||||
Total |
33,337,628 | 32,166,482 | 1,171,146 | |||||||||||
|
|
|
|
|
|
(Note) |
Unrealized Gains (Losses) includes ¥5,191 million which was recognized in the statement of income by applying the fair-value hedge method. |
- 42 -
As of September 30, 2020
(Millions of yen) |
||||||||||||||
Type |
Interim Consolidated
Balance Sheet Amount |
Acquisition Cost | Difference | |||||||||||
Other Securities Whose Interim Consolidated Balance Sheet Amount Exceeds Acquisition Cost |
Stocks | 2,327,891 | 899,022 | 1,428,868 | ||||||||||
Bonds |
12,797,854 | 12,769,584 | 28,270 | |||||||||||
Japanese Government Bonds |
10,898,764 | 10,896,156 | 2,607 | |||||||||||
Japanese Local Government Bonds |
177,107 | 176,350 | 756 | |||||||||||
Japanese Corporate Bonds |
1,721,982 | 1,697,076 | 24,906 | |||||||||||
Other |
10,609,376 | 10,385,648 | 223,728 | |||||||||||
Foreign Bonds |
9,427,109 | 9,242,592 | 184,516 | |||||||||||
Other Debt Purchased |
194,497 | 192,782 | 1,714 | |||||||||||
Other |
987,769 | 950,272 | 37,497 | |||||||||||
|
|
|
|
|
|
|||||||||
Sub-total |
25,735,122 | 24,054,254 | 1,680,867 | |||||||||||
|
|
|
|
|
|
|||||||||
Other Securities Whose Interim Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost |
Stocks | 253,908 | 312,568 | (58,660 | ) | |||||||||
Bonds |
10,309,916 | 10,388,748 | (78,831 | ) | ||||||||||
Japanese Government Bonds |
9,021,598 | 9,068,866 | (47,268 | ) | ||||||||||
Japanese Local Government Bonds |
230,076 | 230,522 | (446 | ) | ||||||||||
Japanese Corporate Bonds |
1,058,241 | 1,089,358 | (31,116 | ) | ||||||||||
Other |
5,421,575 | 5,503,408 | (81,833 | ) | ||||||||||
Foreign Bonds |
3,872,354 | 3,885,371 | (13,016 | ) | ||||||||||
Other Debt Purchased |
63,383 | 63,506 | (123 | ) | ||||||||||
Other |
1,485,836 | 1,554,529 | (68,693 | ) | ||||||||||
|
|
|
|
|
|
|||||||||
Sub-total |
15,985,399 | 16,204,725 | (219,325 | ) | ||||||||||
|
|
|
|
|
|
|||||||||
Total |
41,720,521 | 40,258,979 | 1,461,541 | |||||||||||
|
|
|
|
|
|
(Note) |
Unrealized Gains (Losses) includes ¥1,301 million which was recognized in the statement of income by applying the fair-value hedge method. |
- 43 -
3. |
Impairment (Devaluation) of Securities |
Certain Securities other than Trading Securities (excluding Stocks and others without a quoted market price and Investments in Partnerships and others) are devalued to the fair value, and the difference between the acquisition cost and the fair value is treated as a loss for the six months ended September 30, 2020 (the fiscal year ended March 31, 2020) (impairment (devaluation)), if the fair value has significantly deteriorated compared with the acquisition cost (including amortized cost), and unless it is deemed that there is a possibility of a recovery in the fair value.
The amount of impairment (devaluation) for the fiscal year ended March 31, 2020 was ¥41,655 million.
The amount of impairment (devaluation) for the six months ended September 30, 2020 was ¥63,950 million.
The criteria for determining whether a securitys fair value has significantly deteriorated are outlined as follows:
|
Securities whose fair value is 50% or less of the acquisition cost |
|
Securities whose fair value exceeds 50% but is 70% or less of the acquisition cost and the quoted market price maintains a certain level or lower |
- 44 -
Money Held in Trust
1. |
Money Held in Trust Held to Maturity |
There was no Money Held in Trust held to maturity.
2. |
Other in Money Held in Trust (other than for investment purposes and held to maturity purposes) |
As of March 31, 2020
(Millions of yen) | ||||||||||||||||||||
Consolidated
Balance Sheet Amount |
Acquisition Cost | Difference |
Other in Money
Held in Trust Whose Consolidated Balance Sheet Amount Exceeds Acquisition Cost |
Other in Money
Held in Trust Whose Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost |
||||||||||||||||
Other in Money Held in Trust |
7,125 | 7,125 | | | |
(Note) |
Other in Money Held in Trust Whose Consolidated Balance Sheet Amount Exceeds Acquisition Cost and Other in Money Held in Trust Whose Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost are components of Difference. |
As of September 30, 2020
(Millions of yen) | ||||||||||||||||||||
Interim
Consolidated Balance Sheet Amount |
Acquisition Cost | Difference |
Other in Money
Held in Trust Whose Interim Consolidated Balance Sheet Amount Exceeds Acquisition Cost |
Other in Money
Held in Trust Whose Interim Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost |
||||||||||||||||
Other in Money Held in Trust |
8,018 | 8,018 | | | |
(Note) |
Other in Money Held in Trust Whose Interim Consolidated Balance Sheet Amount Exceeds Acquisition Cost and Other in Money Held in Trust Whose Interim Consolidated Balance Sheet Amount Does Not Exceed Acquisition Cost are components of Difference. |
- 45 -
Unrealized Gains (Losses) on Other Securities
Details of Unrealized Gains (Losses) on Other Securities on the interim consolidated balance sheet (consolidated balance sheet) are as follows:
As of March 31, 2020
(Millions of yen) | ||||
Amount | ||||
Difference between Acquisition Cost and Fair Value |
1,177,927 | |||
Other Securities |
1,177,927 | |||
() Deferred Tax Liabilities |
338,232 | |||
Difference between Acquisition Cost and Fair Value, net of Taxes (Before adjusting for amount corresponding to Non-controlling Interests) |
839,695 | |||
() Amount Corresponding to Non-controlling Interests |
18,922 | |||
(+) Amount Corresponding to Net Unrealized Gains (Losses) on Other Securities Owned by Affiliated Companies, which is attributable to MHFG |
2,311 | |||
|
|
|||
Net Unrealized Gains (Losses) on Other Securities |
823,085 | |||
|
|
(Notes) |
1. | The difference between acquisition cost and fair value excludes ¥5,191 million in losses which were recognized in the statement of income for the fiscal year ended March 31, 2020 by applying the fair-value hedge method. | ||
2. |
Other Securities includes translation differences regarding Stocks and others without a quoted market price and Investments in Partnerships and others. |
As of September 30, 2020
(Millions of yen) | ||||
Amount | ||||
Difference between Acquisition Cost and Fair Value |
1,464,873 | |||
Other Securities |
1,464,873 | |||
() Deferred Tax Liabilities |
412,842 | |||
Difference between Acquisition Cost and Fair Value, net of Taxes (Before adjusting for amount corresponding to Non-controlling Interests) |
1,052,030 | |||
() Amount Corresponding to Non-controlling Interests |
16,199 | |||
(+) Amount Corresponding to Net Unrealized Gains (Losses) on Other Securities Owned by Affiliated Companies, which is attributable to MHFG |
2,950 | |||
|
|
|||
Net Unrealized Gains (Losses) on Other Securities |
1,038,781 | |||
|
|
(Notes) |
1. | The difference between acquisition cost and fair value excludes ¥1,301 million in losses which were recognized in the statement of income for six months ended September 30, 2020 by applying the fair-value hedge method. | ||||
2. | Other Securities includes translation differences regarding Stocks and others without a quoted market price and Investments in Partnerships and others. |
- 46 -
Derivatives Information
Derivative Transactions not Qualifying for Hedge Accounting
With regard to derivative transactions not qualifying for hedge accounting, contract value or contractual principal equivalents, fair values and unrealized gains (losses), and fair value calculation method by type of transaction as of the interim consolidated balance sheet date (consolidated balance sheet date) are as follows. Contract value amounts do not indicate the market risk related to derivative transactions.
(1) |
Interest Rate and Bond-Related Transactions |
As of March 31, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Interest Rate Futures | |||||||||||||||||
Sold |
5,529,634 | 1,591,823 | (31,113 | ) | (31,113 | ) | ||||||||||||
Bought |
5,887,309 | 2,471,820 | 35,315 | 35,315 | ||||||||||||||
Interest Rate Options | ||||||||||||||||||
Sold |
419,803 | 40,353 | (1,901 | ) | (767 | ) | ||||||||||||
Bought |
757,178 | 29,771 | 2,961 | 1,352 | ||||||||||||||
Bond Futures | ||||||||||||||||||
Sold |
624,565 | | (11,223 | ) | (11,223 | ) | ||||||||||||
Bought |
625,248 | | 6,551 | 6,551 | ||||||||||||||
Bond Futures Options | ||||||||||||||||||
Bought |
| | | | ||||||||||||||
Over-the-Counter |
FRAs | |||||||||||||||||
Sold |
43,095,911 | 108,830 | (27,342 | ) | (27,342 | ) | ||||||||||||
Bought |
39,476,804 | 108,830 | 29,903 | 29,903 | ||||||||||||||
Interest Rate Swaps | ||||||||||||||||||
Receive Fixed / Pay Float |
444,709,861 | 336,523,057 | (9,755,139 | ) | (9,755,139 | ) | ||||||||||||
Receive Float / Pay Fixed |
431,142,776 | 326,305,878 | 10,260,575 | 10,260,575 | ||||||||||||||
Receive Float / Pay Float |
121,038,451 | 95,223,531 | 46,160 | 46,160 | ||||||||||||||
Receive Fixed / Pay Fixed |
329,536 | 313,093 | (1,072 | ) | (1,072 | ) | ||||||||||||
Interest Rate Options | ||||||||||||||||||
Sold |
13,056,382 | 7,542,710 | (255,511 | ) | (255,511 | ) | ||||||||||||
Bought |
12,156,026 | 7,821,714 | 192,734 | 192,734 | ||||||||||||||
Bond Options | ||||||||||||||||||
Sold |
579,001 | 145,808 | (2,593 | ) | (851 | ) | ||||||||||||
Bought |
577,602 | 145,808 | 4,993 | 3,096 | ||||||||||||||
Bond Other | ||||||||||||||||||
Sold |
| | | | ||||||||||||||
Bought |
15,585 | | 422 | 422 | ||||||||||||||
Inter-Company or Internal Transactions |
Interest Rate Swaps | |||||||||||||||||
Receive Fixed / Pay Float |
4,718,469 | 4,347,933 | 131,693 | 131,693 | ||||||||||||||
Receive Float / Pay Fixed |
13,413,792 | 12,916,374 | (273,174 | ) | (273,174 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 352,242 | 351,611 | ||||||||||||||
|
|
|
|
|
|
|
|
(Note) |
The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statement of income. |
- 47 -
As of September 30, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Interest Rate Futures | |||||||||||||||||
Sold |
6,976,734 | 4,101,340 | (19,483 | ) | (19,483 | ) | ||||||||||||
Bought |
6,797,910 | 3,279,414 | 23,119 | 23,119 | ||||||||||||||
Interest Rate Options | ||||||||||||||||||
Sold |
303,477 | 3,792 | (121 | ) | 21 | |||||||||||||
Bought |
956,823 | | 218 | (271 | ) | |||||||||||||
Bond Futures | ||||||||||||||||||
Sold |
850,602 | | (1,728 | ) | (1,728 | ) | ||||||||||||
Bought |
657,830 | | 1,410 | 1,410 | ||||||||||||||
Bond Futures Options | ||||||||||||||||||
Bought |
40,290 | | 46 | (3 | ) | |||||||||||||
Over-the-Counter |
FRAs | |||||||||||||||||
Sold |
38,313,903 | 105,810 | (7,974 | ) | (7,974 | ) | ||||||||||||
Bought |
37,730,831 | 105,810 | 8,035 | 8,035 | ||||||||||||||
Intersest Rate Swaps | ||||||||||||||||||
Receive Fixed / Pay Float |
417,242,767 | 314,341,563 | 5,811,145 | 5,811,145 | ||||||||||||||
Receive Float / Pay Fixed |
411,283,772 | 306,587,930 | (5,321,319 | ) | (5,321,319 | ) | ||||||||||||
Receive Float / Pay Float |
132,765,273 | 106,307,283 | (11,009 | ) | (11,009 | ) | ||||||||||||
Receive Fixed / Pay Fixed |
339,849 | 285,230 | (3,939 | ) | (3,939 | ) | ||||||||||||
Interest Rate Options | ||||||||||||||||||
Sold |
13,347,258 | 9,082,714 | (134,214 | ) | (134,214 | ) | ||||||||||||
Bought |
13,369,597 | 9,712,138 | 91,234 | 91,234 | ||||||||||||||
Bond Options | ||||||||||||||||||
Sold |
530,411 | 149,654 | (3,809 | ) | (2,654 | ) | ||||||||||||
Bought |
563,199 | 149,654 | 3,751 | 2,285 | ||||||||||||||
Bond Other | ||||||||||||||||||
Sold |
2,126 | | (0 | ) | (0 | ) | ||||||||||||
Bought |
2,378 | | 2 | 2 | ||||||||||||||
Inter-Company or Internal Transactions |
Interest Rate Swaps | |||||||||||||||||
Receive Fixed / Pay Float |
4,576,668 | 4,091,405 | 133,038 | 133,038 | ||||||||||||||
Receive Float / Pay Fixed |
13,570,172 | 11,267,691 | (275,248 | ) | (275,248 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 293,154 | 292,446 | ||||||||||||||
|
|
|
|
|
|
|
|
(Note) |
The above transactions are marked to market, and changes in unrealized gains (losses) are included in the interim consolidated statement of income. |
(Changes in Presentation)
With the enactment of Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019) and other standards, interest rate-related transactions and bond-related transactions are presented as Interest Rate and Bond-Related Transactions from the interim period ended September 30, 2020.
- 48 -
(2) |
Currency-Related Transactions |
As of March 31, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Futures | |||||||||||||||||
Sold |
13,092 | 329 | | | ||||||||||||||
Bought |
48,893 | 14,608 | | | ||||||||||||||
Over-the-Counter |
Swaps | 57,638,817 | 43,894,609 | 1,219 | (68,637 | ) | ||||||||||||
Forwards | ||||||||||||||||||
Sold |
75,494,594 | 3,175,535 | (199,399 | ) | (199,399 | ) | ||||||||||||
Bought |
37,624,376 | 1,697,421 | 242,910 | 242,910 | ||||||||||||||
Options | ||||||||||||||||||
Sold |
5,145,203 | 1,383,542 | (82,922 | ) | (36,588 | ) | ||||||||||||
Bought |
4,805,185 | 1,114,200 | 67,035 | 13,026 | ||||||||||||||
Inter-Company or Internal Transactions |
Swaps | 2,858,190 | 1,991,772 | (151,891 | ) | 8,698 | ||||||||||||
Forwards | ||||||||||||||||||
Sold |
101 | | 0 | 0 | ||||||||||||||
Bought |
7,026 | | 19 | 19 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | (123,027 | ) | (39,970 | ) | ||||||||||||
|
|
|
|
|
|
|
|
(Note) | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statement of income. |
As of September 30, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Futures | |||||||||||||||||
Sold |
13,297 | 1,085 | | | ||||||||||||||
Bought |
51,854 | 16,438 | | | ||||||||||||||
Over-the-Counter |
Swaps | 60,774,685 | 46,332,699 | 37,928 | (59,449 | ) | ||||||||||||
Forwards | ||||||||||||||||||
Sold |
63,725,403 | 3,390,130 | 101,973 | 101,973 | ||||||||||||||
Bought |
38,313,929 | 1,704,570 | (118,994 | ) | (118,994 | ) | ||||||||||||
Options | ||||||||||||||||||
Sold |
4,023,603 | 1,536,387 | (47,327 | ) | (4,074 | ) | ||||||||||||
Bought |
3,496,863 | 1,386,418 | 41,267 | (12,221 | ) | |||||||||||||
Inter-Company or Internal Transactions |
Swaps | 2,476,136 | 1,942,018 | (108,963 | ) | 15,741 | ||||||||||||
Forwards | ||||||||||||||||||
Sold |
| | | | ||||||||||||||
Bought |
977 | | (13 | ) | (13 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | (94,129 | ) | (77,038 | ) | ||||||||||||
|
|
|
|
|
|
|
|
(Note) | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the interim consolidated statement of income. |
- 49 -
(3) |
Stock-Related Transactions |
As of March 31, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Index Futures | |||||||||||||||||
Sold |
251,436 | 22,541 | (3,119 | ) | (3,119 | ) | ||||||||||||
Bought |
425,430 | 22,852 | 10,721 | 10,721 | ||||||||||||||
Index Futures Options | ||||||||||||||||||
Sold |
2,170,366 | 464,262 | (155,113 | ) | (49,255 | ) | ||||||||||||
Bought |
1,906,816 | 383,082 | 146,827 | 40,266 | ||||||||||||||
Over-the-Counter |
Equity Linked Swaps | 471,137 | 374,198 | 91,888 | 91,888 | |||||||||||||
Options | ||||||||||||||||||
Sold |
476,111 | 217,740 | (50,480 | ) | (50,480 | ) | ||||||||||||
Bought |
225,048 | 59,822 | 57,065 | 57,065 | ||||||||||||||
Other | ||||||||||||||||||
Sold |
13,676 | 13,676 | 237 | 237 | ||||||||||||||
Bought |
429,384 | 296,005 | 28,439 | 28,439 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 126,467 | 125,764 | ||||||||||||||
|
|
|
|
|
|
|
|
(Note) |
The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statement of income. |
As of September 30, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Index Futures | |||||||||||||||||
Sold |
583,790 | 90,718 | (6,181 | ) | (6,181 | ) | ||||||||||||
Bought |
736,780 | | (1,201 | ) | (1,201 | ) | ||||||||||||
Index Futures Options | ||||||||||||||||||
Sold |
1,733,397 | 610,298 | (139,391 | ) | (42,652 | ) | ||||||||||||
Bought |
1,468,631 | 527,200 | 111,388 | 26,366 | ||||||||||||||
Over-the-Counter |
Equity Linked Swaps | 739,288 | 535,233 | 60,003 | 60,003 | |||||||||||||
Options | ||||||||||||||||||
Sold |
406,023 | 236,246 | (61,417 | ) | (61,417 | ) | ||||||||||||
Bought |
193,545 | 76,826 | 78,086 | 78,086 | ||||||||||||||
Other | ||||||||||||||||||
Sold |
147,557 | 147,557 | (20,586 | ) | (20,586 | ) | ||||||||||||
Bought |
589,886 | 467,594 | 173,399 | 173,399 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 194,098 | 205,815 | ||||||||||||||
|
|
|
|
|
|
|
|
(Note) |
The above transactions are marked to market, and changes in unrealized gains (losses) are included in the interim consolidated statement of income. |
- 50 -
(4) |
Commodity-Related Transactions |
As of March 31, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Futures | |||||||||||||||||
Sold |
13,086 | 6,097 | 3,098 | 3,098 | ||||||||||||||
Bought |
24,556 | 13,371 | (5,794 | ) | (5,794 | ) | ||||||||||||
Over-the-Counter |
Options | |||||||||||||||||
Sold |
172,561 | 73,050 | 30,337 | 30,337 | ||||||||||||||
Bought |
161,781 | 65,707 | (25,017 | ) | (25,017 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 2,623 | 2,623 | ||||||||||||||
|
|
|
|
|
|
|
|
(Notes) | 1. | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statement of income. | ||
2. | Commodities include oil, copper, aluminum and others. |
As of September 30, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Listed |
Futures | |||||||||||||||||
Sold |
29,355 | 11,723 | 1,880 | 1,880 | ||||||||||||||
Bought |
37,034 | 21,960 | (2,973 | ) | (2,973 | ) | ||||||||||||
Over-the-Counter |
Options | |||||||||||||||||
Sold |
161,001 | 70,415 | 11,084 | 11,084 | ||||||||||||||
Bought |
148,729 | 60,095 | (6,493 | ) | (6,493 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 3,497 | 3,497 | ||||||||||||||
|
|
|
|
|
|
|
|
(Notes) | 1. | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the interim consolidated statement of income. | ||
2. | Commodities include oil, copper, aluminum and others. |
- 51 -
(5) |
Credit Derivative Transactions |
As of March 31, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Over-the-Counter |
Credit Derivatives | |||||||||||||||||
Sold |
1,815,742 | 1,545,558 | (4,725 | ) | (4,725 | ) | ||||||||||||
Bought |
3,022,474 | 2,712,677 | 13,821 | 13,821 | ||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | 9,096 | 9,096 | ||||||||||||||
|
|
|
|
|
|
|
|
(Notes) | 1. | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the consolidated statement of income. | ||
2. | Sold and Bought indicate assumption and cession of credit risk, respectively. |
As of September 30, 2020
(Millions of yen) |
||||||||||||||||||
Classification |
Type |
Contract Value | Fair Value |
Unrealized Gains
(Losses) |
||||||||||||||
Total | Over One Year | |||||||||||||||||
Over-the-Counter |
Credit Derivatives | |||||||||||||||||
Sold |
3,217,071 | 2,983,790 | 44,705 | 44,705 | ||||||||||||||
Bought |
4,688,649 | 4,385,439 | (65,030 | ) | (65,030 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||||
Total |
| | (20,325 | ) | (20,325 | ) | ||||||||||||
|
|
|
|
|
|
|
|
(Notes) | 1. | The above transactions are marked to market, and changes in unrealized gains (losses) are included in the interim consolidated statement of income. | ||
2. | Sold and Bought indicate assumption and cession of credit risk, respectively. |
- 52 -
Business Segment Information, etc.
Business Segment Information
1. |
Summary of reportable segment |
MHFG has introduced an in-house company system based on the groups diverse customer segments. The aim of this system is to leverage MHFGs strengths and competitive advantage, which is the seamless integration of MHFGs banking, trust and securities functions under a holding company structure, to speedily provide high-quality financial services that closely match customer needs.
Specifically, the company system is classified into the following five in-house companies, each based on a customer segment: the Retail & Business Banking Company, the Corporate & Institutional Company, the Global Corporate Company, the Global Markets Company, and the Asset Management Company.
The services that each in-house company is in charge of are as follows:
Retail & Business Banking Company:
Services for individual customers, small and medium-sized enterprises and middle market firms in Japan
Corporate & Institutional Company:
Services for large corporations, financial institutions and public corporations in Japan
Global Corporate Company:
Services for Japanese overseas affiliated corporate customers and non-Japanese corporate customers, etc.
Global Markets Company:
Investment services with respect to interest rates, equities and credits, etc. and other services
Asset Management Company:
Development of products and provision of services that match the asset management needs of its wide range of customers from individuals to institutional investors
The reportable segment information, set forth below, is derived from the internal management reporting systems used by management to measure the performance of the Groups operating segments. Management measures the performance of each of the operating segments in accordance with internal managerial accounting rules and practices.
- 53 -
2. |
Calculating method of Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others, Net business profits or losses (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net gains or losses related to ETFs and others, and Fixed assets by reportable segment |
The following information of reportable segment is based on internal management reporting.
Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others is the total amount of Interest Income, Fiduciary Income, Fee and Commission Income, Trading Income, Other Operating Income and Net gains or losses related to ETFs and others.
Net business profits or losses (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net gains or losses related to ETFs and others is the amount of which General and administrative expenses (excluding non-recurring expenses and others), Equity in income from investments in affiliates, Amortization of goodwill and others (including amortization of intangible assets), and Others (consolidation adjustments) are deducted from, or added to, Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others.
Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others relating to transactions between segments is based on the current market price.
Fixed assets disclosed as asset information by segment are the total amount of tangible fixed assets and intangible fixed assets. Fixed assets pertaining to Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., and Mizuho Securities Co.,Ltd. have been allocated to each segment.
- 54 -
3. |
Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others, Net business profits or losses (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net gains or losses related to ETFs and others, and Fixed assets by reportable segment |
For the six months ended September 30, 2019
(Notes) | 1. | Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others is reported instead of sales reported by general corporations. Net gains or losses related to ETFs and others amounted to ¥ (7,956) million, of which ¥ (11,208) million is included in the Global Markets Company. | ||
2. | Others includes items which should be eliminated as internal transactions between each segment on a consolidated basis. | |||
3. |
Others in Fixed assets includes assets of headquarters that have not been allocated to each segment, Fixed assets pertaining to consolidated subsidiaries that are not subject to allocation, consolidated adjustments, and others. Among Fixed assets that have not been allocated to each segment, some related expenses are allocated to each segment using reasonable criteria of allocation. |
|||
4. | Following the change in allocation method for transactions between each segment and Others made in April, 2020, reclassification was made on the above table to reflect the relevant change. |
- 55 -
For the six months ended September 30, 2020
(Notes) |
1. | Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others is reported instead of sales reported by general corporations. Net gains or losses related to ETFs and others amounted to ¥ (19,005) million, of which ¥ (20,380) million is included in the Global Markets Company. | ||||
2. | Others includes items which should be eliminated as internal transactions between each segment on a consolidated basis. | |||||
3. |
Others in Fixed assets includes assets of headquarters that have not been allocated to each segment, Fixed assets pertaining to consolidated subsidiaries that are not subject to allocation, consolidated adjustments, and others. Among Fixed assets that have not been allocated to each segment, some related expenses are allocated to each segment using reasonable criteria of allocation. |
- 56 -
4. |
The difference between the total amounts of reportable segments and the recorded amounts in the Interim Consolidated Statement of Income, and the contents of the difference (Matters relating to adjustment to difference) |
The above amount of Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others and that of Net business profits (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net gains or losses related to ETFs and others derived from internal management reporting by reportable segment are different from the amounts recorded in the Interim Consolidated Statement of Income.
The contents of the difference for the period are as follows:
(1) |
The total of Gross profits (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others of Segment Information and Ordinary Profits |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Gross profits: (excluding the amounts of credit costs of trust accounts) + Net gains or losses related to ETFs and others |
1,022,765 | 1,093,318 | ||||||
Net gains or losses related to ETFs and others |
7,956 | 19,005 | ||||||
Other Ordinary Income |
117,699 | 63,736 | ||||||
General and Administrative Expenses |
(670,592 | ) | (681,287 | ) | ||||
Other Ordinary Expenses |
(81,357 | ) | (227,161 | ) | ||||
|
|
|
|
|||||
Ordinary Profits |
396,471 | 267,610 | ||||||
|
|
|
|
(2) |
The total of Net business profits (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net gains or losses related to ETFs and others of Segment Information and Income before Income Taxes Recorded in Interim Consolidated Statement of Income |
(Millions of yen) | ||||||||
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||
Net Business Profits (excluding the amounts of credit costs of trust accounts, before reversal of (provision for) general reserve for losses on loans) + Net Gains (Losses) related to ETFs and others |
340,879 | 419,443 | ||||||
Credit Costs for Trust Accounts |
| | ||||||
General and Administrative Expenses (non-recurring losses) |
24,461 | 4,146 | ||||||
Expenses related to Portfolio Problems (including reversal of (provision for) general reserve for losses on loans) |
(19,142 | ) | (84,777 | ) | ||||
Gains on Reversal of Reserves for Possible Losses on Loans, and others |
7,915 | 3,555 | ||||||
Net Gains (Losses) related to StocksNet Gains (Losses) related to ETFs and others |
55,375 | (50,485 | ) | |||||
Net Extraordinary Gains (Losses) |
(5,000 | ) | 65,780 | |||||
Others |
(13,017 | ) | (24,271 | ) | ||||
|
|
|
|
|||||
Income before Income Taxes recorded in
|
391,471 | 333,391 | ||||||
|
|
|
|
- 57 -
Related Information
For the six months ended September 30, 2019
1. |
Information about Geographic Areas |
(1) |
Ordinary Income |
(Millions of yen) |
||||||||||||||||
Japan |
Americas | Europe |
Asia/Oceania
excluding Japan |
Total | ||||||||||||
1,138,373 | 425,585 | 132,382 | 291,083 | 1,987,425 |
(Notes) | 1. | The above table shows Ordinary Income instead of sales of non-financial companies. | ||
2. | Ordinary income is segmented by country and region based on the location of our group office in consideration of geographical proximity, similarity of economic activities, and interrelationship of business activities. |
(2) |
Tangible Fixed Assets |
Information on tangible fixed assets by geographical areas as of September 30, 2019 is not disclosed since tangible fixed assets in Japan accounted for more than 90% of tangible fixed assets.
2. |
Information about Major Customers |
Information about major customers is not disclosed since there are no outside customers that accounted for more than 10% of Ordinary Income of the Company.
For the six months ended September 30, 2020
1. |
Information about Geographic Areas |
(1) |
Ordinary Income |
(Millions of yen) |
||||||||||||||||
Japan |
Americas | Europe |
Asia/Oceania
excluding Japan |
Total | ||||||||||||
1,029,703 | 249,775 | 102,413 | 194,868 | 1,576,761 |
(Notes) | 1. | The above table shows Ordinary Income instead of sales of non-financial companies. | ||
2. | Ordinary income is segmented by country and region based on the location of our group office in consideration of geographical proximity, similarity of economic activities, and interrelationship of business activities. |
(2) |
Tangible Fixed Assets |
Information on tangible fixed assets by geographical areas as of September 30, 2020 is not disclosed since tangible fixed assets in Japan accounted for more than 90% of tangible fixed assets.
2. |
Information about Major Customers |
Information about major customers is not disclosed since there are no outside customers that accounted for more than 10% of Ordinary Income of the Company.
- 58 -
Information about Impairment Loss on Tangible Fixed Assets by Reportable Segment
For the six months ended September 30, 2019
For the six months ended September 30, 2020
Information about Gain on Negative Goodwill Incurred by Reportable Segment
For the six months ended September 30, 2019
There is no applicable information.
For the six months ended September 30, 2020
There is no applicable information.
-59-
Per Share Information
1. |
Net Assets per Share of Common Stock and its basis used for calculation |
As of March 31, 2020 | As of September 30, 2020 | |||||||||
Net Assets per Share of Common Stock |
Yen | 3,372.96 | 3,472.01 | |||||||
(The basis used for calculating Net Assets per Share of Common Stock) |
||||||||||
Total Net Assets |
Millions of yen | 8,663,847 | 8,905,205 | |||||||
Deductions from Total Net Assets |
Millions of yen | 109,876 | 102,327 | |||||||
Stock Acquisition Rights |
Millions of yen | 213 | 134 | |||||||
Non-Controlling Interests |
Millions of yen | 109,662 | 102,192 | |||||||
Net Assets related to Common Stock at the end of the period/the fiscal year |
Millions of yen | 8,553,971 | 8,802,877 | |||||||
Outstanding Shares of Common Stock, based on which Total Net Assets per Share of Common Stock was calculated, at the end of the period/the fiscal year |
Thousands of shares | 2,536,039 | 2,535,381 |
(Note) | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Net Assets per Share of Common Stock is calculated under the assumption that the share consolidation had been adopted at the beginning of fiscal 2019. |
- 60 -
2. |
Net Income per Share of Common Stock and Diluted Net Income per Share of Common Stock are based on the following information: |
For the six months ended
September 30, 2019 |
For the six months ended
September 30, 2020 |
|||||||||
(1) Net Income per Share of Common Stock |
Yen | 113.43 | 84.99 | |||||||
(The basis used for calculating Net Income per Share of Common Stock) |
||||||||||
Profit Attributable to Owners of Parent |
Millions of yen | 287,668 | 215,523 | |||||||
Amount not attributable to Common Stock |
Millions of yen | | | |||||||
Profit Attributable to Owners of Parent related to Common Stock |
Millions of yen | 287,668 | 215,523 | |||||||
Average Outstanding Shares of Common Stock (during the period) |
Thousands of shares | 2,535,955 | 2,535,837 | |||||||
(2) Diluted Net Income per Share of Common Stock |
Yen | 113.42 | 84.98 | |||||||
(The basis used for calculating Diluted Net Income per Share of Common Stock) |
||||||||||
Adjustment to Profit Attributable to Owners of Parent |
Millions of yen | | | |||||||
Increased Number of Shares of Common Stock |
Thousands of shares | 188 | 92 | |||||||
Stock Acquisition Rights |
Thousands of shares | 188 | 92 | |||||||
Description of dilutive securities which were not included in the calculation of Diluted Net Income per Share of Common Stock as they have no dilutive effects |
| |
(Notes) | 1. | MHFG adopted the share consolidation of the shares of common stock on the basis of one post-consolidation share per ten pre-consolidation shares effective as of October 1, 2020. Net Income per Share of Common Stock and Diluted Net Income per Share of Common Stock are calculated under the assumption that the share consolidation had been adopted at the beginning of fiscal 2019. | ||
2. | In the calculation of Net Assets per share, MHFG shares outstanding in BBT trust account that were recognized as Treasury Stock in Shareholders Equity are included in Treasury Stock shares deducted from the total number of issued shares at the end of the period/the fiscal year. The number of such Treasury Stock shares deducted at the end of the previous fiscal year (March 31, 2020) was 1,963 thousand, and the number of such Treasury Stock shares deducted at the end of the period (September 30, 2020) was 2,556 thousand. | |||
In the calculation of Net Income per Share of Common Stock and Diluted Net Income per Share of Common Stock, such Treasury Stock shares are included in Treasury Stock shares deducted in the calculation of the Average Outstanding Shares of Common Stock during the period. The average number of such Treasury Stock shares deducted during the six months ended September 30, 2019 was 1,887 thousand, and the average number of such Treasury Stock shares deducted during the six months ended September 30, 2020 was 2,146 thousand. |
- 61 -
Subsequent Events
The Board of Directors of the MHFG resolved in a meeting held on May 15, 2020 to include the following share consolidation in the agenda for the 18th Ordinary General Meeting of Shareholders held on June 25, 2020 and the agenda gained the approval in the Ordinary General Meeting of Shareholders. The share consolidation is effective as of October 1, 2020.
The influence on Per Share Information is described in Notes to Interim Consolidated Financial Statements - Per Share Information.
(1) |
Purpose of the share consolidation |
MHFGs current share price was significantly below the desirable Trading Unit range of 50,000 yen to 500,000 yen designated by the Securities Listing Regulations of the Tokyo Stock Exchange.
In order to address this situation, we resolved to include the following share consolidation of common stock on the basis of one post-consolidation share per ten pre-consolidation shares in the agenda for the Ordinary General Meeting of Shareholders.
(2) |
Details of the share consolidation |
i. |
Class of shares to be consolidated |
Common Stock
ii. |
Consolidation rate |
One post-consolidation share per ten pre-consolidation shares based on the shares owned by the shareholders recorded in the shareholder register as of September 30, 2020.
iii. |
Effective date |
October 1, 2020
iv. |
Total number of Authorized Shares |
5,130,000,000 shares
Changing on the effective date of the share consolidation pursuant to Article 182, Paragraph 2 of Japans Companies Act
v. |
Number of shares to be reduced by the consolidation (Number of shares to be reduced could be changed) |
Total number of issued shares before the consolidation as of September 30 2020 |
25,392,498,945 | |||
Number of shares to be reduced by the consolidation |
22,853,249,051 | |||
Total number of issued shares after the consolidation |
2,539,249,894 |
- 62 -
II. Others
There is no applicable information.
- 63 -