T he S u m itom o T r u st T he S u m itom o T r u st T he S u m itom o T r u st T he S u m itom o T r u st & B a n k in g Co., L td . & B a n k in g Co., L td . & B a n k in g Co., L td . & B a n k in g Co., L td . Explanatory Material for Financial Results for 3QFY2008 February 6, 2009
This presentation material contains information that constitutes forward- looking statements. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in the forward-looking statements as a result of various factors including changes in managerial circumstances. This presentation does not constitute an offer to sell or a solicitation of an offer to subscribe for or purchase any securities.
1 3QFY2008 financial results 中表紙
3QFY2008 financial results (April 2008 – December 2008) Net income (consolidated): Decreased by 33.4 billion yen from 3QFY2007 to 20.4 billion yen, mainly due to the increase in total substantial credit costs Net business profit before credit costs (non-consolidated): Increased by 33.1 billion yen from 3QFY2007 to 148.9 billion yen, as the increase in market-related profit exceeded the decrease in net fees and commissions 3QFY2008 3QFY2007 Change Cumulative total Cumulative total 3Q 1 - 2Q <Consolidated> (in billions of Yen) (A) (B) (A) - (B) Net business profit before credit costs 181.2 85.9 95.3 148.5 32.7 Total substantial credit costs (*1) -96.7 -72.1 -24.5 -58.6 -38.0 Ordinary profit 52.0 -2.6 54.7 87.4 -35.3 Net income 20.4 -7.9 28.3 53.8 -33.4 <Non-consolidated> (in billions of Yen) Net business profit before credit costs 148.9 76.1 72.7 115.8 33.1 123.9 42.3 81.6 116.6 7.3 Net interest income (Incl. Trust fees from principal guaranteed trust a/c) Net fees & commissions (Incl. Other trust fees) 60.5 15.8 44.7 78.6 -18.0 Other profits 62.5 48.9 13.5 16.1 46.3 General and administrative expenses -98.1 -30.9 -67.2 -95.6 -2.4 Total substantial credit costs (*1) -65.3 -55.0 -10.3 -51.3 -14.0 Losses related to international credit investments -44.8 -34.8 -10.0 -27.6 -17.2 Net gains on sales of Japanese stocks -26.0 -16.8 -9.1 5.7 -31.8 Ordinary profit 52.4 4.9 47.5 62.5 -10.0 Extraordinary profit (*2) 1.1 1.4 -0.3 8.9 -7.8 Net income 34.9 4.5 30.3 45.5 -10.5 (*1) Total substantial credit costs” is a sum of “Total credit costs”, costs in “Net gains on sales of stocks and other securities” and “Other non-recurring profit” which are related to investment in securities of domestic and overseas credit (Total credit costs of affiliates by equity method are included in Consolidated total substantial credit costs.). (*2) Exclude items included in "Total subustabtial credit cost" 2
Breakdown of profit by business (Non-consolidated) Retail financial services: Gross business profit decreased by 6.3 billion yen from 3QFY2007, due to the decline in sales of mutual funds and individual annuities Real estate: Gross business profit decreased by 13.9 billion yen from 3QFY2007, due to the decline in real estate brokerage transactions Treasury and financial products: Gross business profit increased by 73.1 billion yen from 3QFY2007, due to the significant improvement in bond related profit while trading profit declined <Gross business profit before credit costs (Non-consolidated)> Change 3QFY2008 3QFY2007 FY2007 FY2007 from Cumulative Cumulative 3Q 1-2Q 2H 1H (in billions of Yen) total total 3QFY2007 59.5 19.1 40.5 65.9 -6.3 43.1 44.5 Retail financial services Wholesale financial services 72.0 22.4 49.6 73.0 -1.0 43.7 52.6 15.1 5.9 9.2 14.2 0.8 8.5 10.0 Stock transfer agency services Treasury and financial products 107.8 74.7 33.2 34.7 73.1 39.5 9.8 41.2 11.2 30.0 37.5 3.7 32.7 29.7 Fiduciary services Pension asset management 27.5 7.8 19.7 23.4 4.1 23.1 19.8 13.7 3.4 10.3 14.2 -0.4 9.6 9.9 Securities processing services 8.3 1.3 7.0 22.2 -13.9 13.0 18.8 Real estate Fees paid for outsourcing (*1) -20.0 -6.8 -13.2 -18.2 -1.7 -12.8 -13.3 Others (*2) -21.8 -14.7 -7.1 -3.6 -18.1 1.9 2.5 247.0 107.1 139.9 211.4 35.6 161.0 144.6 Total Note: Redemption profit of mutual fund (9.0 billion yen) , which was included in Others in 1HFY2008, has been reclassified into Treasury and financial products since 3QFY2008. (*1) Breakdown by business group for 3QFY2008 with changes from 3QFY2007 in parenthesis: Stock transfer agency services -9.7 billion yen (-0.5 billion yen), Fiduciary services -10.2 billion yen (-1.1 billion yen) (*2) Net of dividend income, cost of capital sourcing and adjustment as a result of reclassifying some non-recurring profit into gross business profit for certain business group are included. 3
Fee revenue breakdown (Non-consolidated) Retail financial services: Fee revenue decreased by 7.4 billion yen from 3QFY2007, mainly due to the reduction of mutual fund sales fee owing to the decline in mutual fund sales, though mutual fund administration fee decreased by only 0.9 billion yen Real estate: Fee revenue decreased by 11.5 billion yen from 3QFY2007, due to the decline in real estate brokerage fee owing to the stagnant real estate market (Fee revenue of our real estate brokerage subsidiary, which handles residence and small to medium-scale real estate, decreased by only 23% from 3QFY2007) <Sales volume and fee revenue of mutual fund/ (For reference) Balance of mutual fund/ individual annuity (Non-consolidated) individual annuity (Non-consolidated)> Change 3QFY2008 FY2007 (in billions of Yen) Dec-08 Sep-08 Mar-08 Sep-07 from Cumulative 3Q 1-2Q 2H 3QFY2007 (in billions of Yen) Balance of mutual fund 935.1 1,199.6 1,278.1 1,484.1 total Sales volume of mutual fund 116.5 22.2 94.2 -205.3 102.7 Balance of individual annuity 555.1 576.5 550.0 529.3 Sales volume of individual annuity 45.9 12.8 33.0 -17.7 36.2 Total 1,490.2 1,776.1 1,828.1 2,013.4 Total 162.4 35.1 127.2 -223.1 138.9 <Major factors of decrease in balance of mutual fund > Sales fee 4.9 0.9 3.9 -6.5 4.3 Balance of mutual fund decreased by 264.5 billion yen from Administration fee 6.7 1.8 4.8 -0.9 5.0 the end of September 2008, mainly due to the market Total 11.6 2.8 8.8 -7.4 9.4 conditions of stock market decline and yen appreciation (approximately -260.0 billion yen) (For reference) Group companies’ Gross profit for real <Gross profit for real estate business estate business (Consolidated)> (Non-consolidated)> Change Change 3QFY2008 FY2007 3QFY2008 FY2007 from from Cumulativ e Cumulativ e 3Q 1-2Q 2H 3Q 1-2Q 2H 3QFY2007 3QFY2007 (in billions of Yen) total (in billions of Yen) total Brokerage (commercial) 4.3 0.4 3.9 -10.2 9.0 Brokerage (residential) 5.8 1.6 4.2 -1.7 5.4 Securitization 3.5 0.9 2.6 -1.2 3.5 Asset management 1.1 0.3 0.7 0.1 1.1 Total 7.8 1.3 6.5 -11.5 12.5 Total 7.0 2.0 4.9 -1.6 6.5 4
Breakdown of total substantial credit costs 1. Group companies, Domestic (Non-consolidated) Total substantial credit costs of group companies for 3QFY2008 alone were -17.1 billion yen including -14.9 billion yen of First Credit mainly due to the revaluation of real estate collaterals Domestic (non-consolidated) for 3QFY2008 alone was -20.1 billion yen including credit cost caused by the downgrade of a certain large corporation to substandard debtor (approximately -11.0 billion yen) and that caused by the legal bankrupt of certain debtors (approximately -6.0 billion yen) <Total substantial credit costs> 3QFY2008 FY2007 FY2008 Cumulative Full 1H 3Q Major factors (Oct. to Dec. 2008) (in billions of Yen) total Consolidated -83.5 -24.5 -96.7 -72.1 Non-consolidated -55.0 Overseas related -34.8 (see next page), domestic related -20.1 -75.5 -10.3 -65.3 Group companies -7.9 -14.1 -31.3 -17.1 STB Leasing -1.4 -1.9 -2.9 -0.9 Worsened business condition of large debtors -0.9 Sumishin Matsushita Financial Services -0.4 -1.9 -2.4 -0.4 Worsened business condition of debtors -0.4 First Credit 0.1 -8.1 -23.0 -14.9 Revaluation of real estate collateral -10.6, increase in loss ratio -0.9 <Breakdown of total substantial credit costs (Domestic, non-consolidated)> FY2007 FY2008 3QFY2008 Cumulative Full 1H 3Q Major factors of change (Oct. to Dec. 2008) total Account (in billions of Yen) 5.7 -0.3 -20.4 -20.1 Total credit costs -5.5 2.6 -10.8 -13.4 General allowance for loan losses Downgrade of a certain large corporation to substandard debtor appx. -11.0 Increase in loans to special mention debtors Specific allowance for loan losses 15.0 -3.0 -3.7 -0.7 Written off and losses on sales of loans -5.1 -0.6 -6.7 -6.1 Legal bankrupt of certain debtors appx. -6.0 3.7 -0.2 -20.4 -20.1 Total 5
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