1. Background for the Medium-term Management Plan and How the Plan is Positioned

In order to correspond to difficult business environment, Concordia Financial Group, Ltd. (hereinafter, the “Company”) and its consolidated subsidiaries and equity method affiliates (hereinafter the “Group”) shall position the period under the Plan as three transformative years for converting the Company into a new finance company beyond the scope of traditional banks based on the Group’s strengths and opportunities for the Group.

2. Outline of the Medium-term Management Plan

Period>

April 2019 to March 2022

How the Plan is Positioned

Three transformative years for converting the Company into a new finance company

Key Performance Indicators (KPIs)

The Company shall maintain a risk-return profile of a certain level by advancing solutions sales and appropriately taking risks in the environment of low interest rates. At the same time, the Company shall improve efficiency through structural reforms, and seek to increase corporate value in a sustainable manner.

Three Basic Policies and 10 Key Initiatives



Basic policy (1): deepening core businesses
The Company shall seek to advance solutions sales based on sales strategies in agreement with the characteristics of respective regions in order to deepen core businesses by applying a strength called an unrivaled customer base in Kanagawa Prefecture and an opportunity called the mega Tokyo market to the maximum extent. At the same time, the Company shall aim at expanding overseas businesses by supporting the growth of customers and accumulating overseas assets. Furthermore, the Company shall work on diversifying fund management based on proper risk management, taking the size of a loan-deposit gap and sustained low interests in Japan into consideration.

Basic policy (2): improving productivity through structural reforms
The Company shall address structural reforms focused on the reforms of operations and branch channels with the application of digital technologies in order to build up the know-how of efficient business administration, one of the Group’s strengths, more and improve productivity in existing banking operations.

Basic policy (3): solidifying the management base
The Company shall enter new business fields by making the most of strategic investments, contributions and the like in order to transform itself a finance company beyond the scope of traditional banks. At the same time, the Company shall positively work on developing strong organizations and training strong individuals able to support sustainable growth for the cause of achieving sustainable development goals (SDGs). Furthermore, the Company shall continue balanced shareholder returns based on the capital policy of maintaining soundness and improving the capital efficiency with the use of a risk appetite framework.

Medium-term Management Plan of Concordia Financial Group, Ltd.

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