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Hideyuki Kudo

The Shinsei Bank Group has created a “Medium- to Long-Term Vision” in accordance with its management principles in order to better pursue its goal of becoming a financial group which is truly needed by its customers. In accordance with this vision, we have established the Third Medium-Term Management Plan, a three-year management plan which runs from FY2016 to FY2018. This Plan is the first step toward the achievement of the Group’s Medium- to Long-Term Vision, and through it we look to establish a business model capable of delivering stable, sustainable growth.

As a result of the undertakings of the Group’s Second Medium-Term Management Plan (FY2013-FY2015) (hereinafter, “2nd MTMP”), the Group has consistently recorded positive net income and the quality of the Group’s portfolio has improved with its nonperforming loan ratio far exceeding the target which had been established in the plan. However, our net income was supported by factors such as the recording of non-recurring revenues and gains on the reversal of reserves for loan losses associated with the disposal of nonperforming loans, and we have concluded that the challenge of the Group going forward is to fully realize the growth potential of businesses capable of delivering recurring, stable profits.

Taking this into account, during the period of the Third Medium Term Management Plan (hereinafter, “3nd MTMP”), the implementation of which has begun this fiscal year, we aim to re-establish our unique positioning within the Japanese financial services industry through a growth focused restructuring of our business mix. In order to accomplish this, we will pursue business and operational management synergies amongst its Group companies. Additionally, we view the repayment of public funds as a key management issue, and while accumulating a level of retained earnings sufficient for a public fund injected Bank, are seeking to both improve shareholder returns as well as identify the path to the repayment of public funds.

Specifically, we will undertake a “Selection and Concentration” of businesses, and in addition to reallocating management resources to business areas which are expected to deliver higher levels of growth, and by integrating the expertise of our Group companies we look to develop innovative ideas and solutions which create value for our customers. Additionally, we will flexibly and proactively restructure and optimize the utilization of our management resources, responding to the changes in the external business environment and the Group’s performance in order to establish an operation management structure which is optimal for fully realizing the potential of our employees and our organization. Through such measures, we seek to grow our sustainable profits during the 3rd MTMP, and looks to achieve a consolidated net income attributable to owners of parent of 64.0 billion yen in fiscal year 2018.

The firm results recorded during the 2nd MTMP could not have been possible without the continued understanding and support of our various stakeholders, for which I would like to take this opportunity to express our sincere gratitude. The management and employees of the Shinsei Bank Group are firmly committed to meeting the expectations of all its stakeholders as we implements the 3rd MTMP from this fiscal year.

We hope to enjoy your continued support in the future.

April 2016
Hideyuki Kudo
Hideyuki Kudo
President and Chief Executive Officer

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