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 May 2019

Commission File Number 001-33098

Mizuho Financial Group, Inc.

(Translation of registrant’s 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-                    .

 

 

 

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.

 

By making progress on transitioning to the next generation of financial services through the implementation of our new business plan, we strive to respond to the trust placed in us by our shareholders

 

Results of operations and dividend payouts				Point 1		We resolved structural issues ahead of schedule and maintained an adequate level of capital		p. 7
				Point 2		An annual dividend of JPY 7.50 per share of common stock for fiscal year 2018 was paid as initially estimated at the beginning of this fiscal year		p. 10
Strategy to create new Mizuho				Point 3		Mizuho’s efforts in the past year We have implemented changes to the structure and foundations of our business, further integrated the “customer first” principle into everything we do, and fundamentally increased productivity		p. 14
				Point 4		Mizuho in the future We have launched the 5-Year Business Plan – Transitioning to the Next Generation of Financial Services as our new business plan		p.16
				Point 5		To bring fruitfulness to each customer and the economies, industries and the societies in which we operate, over the next 10 years and beyond		p. 18

 

2

Governance system to support our sustainable growth				Point 6		We have established our characteristic governance system in order to pursue increased effectiveness		p. 22
				Point 7		Executive compensation system revised in order to ensure an attitude towards improvement of corporate value shared with shareholders		p. 26
External recognition				Point 8		Our initiatives have been recognized highly by various external institutions		p. 28
Toward further improvement of trust				Point 9		We respond sincerely to the voices of our shareholders		p. 29

 

3

Table of contents
∎ Message to our shareholders			p. 7
∎ Convocation notice of the 17th Ordinary General Meeting of Shareholders			p. 32
∎ Reference materials for the General Meeting of Shareholders			p. 35
Company’s proposal (Proposal 1)			p. 35
Shareholders’ proposal (Proposal 2)			p. 55
∎ Business Report for the 17th Fiscal Year			p. 58
1. The current state of Mizuho Financial Group, Inc.			p. 58
2. Matters regarding directors and executive officers			p. 93
3. Matters regarding outside directors			p. 112
4. Matters regarding Mizuho Financial Group’s shares			p. 114
5. Matters regarding stock acquisition rights of Mizuho Financial Group			p. 117
6. Matters regarding Independent Auditor			p. 119
7. Structure for ensuring appropriate conduct of operations			p. 121
8. Matters regarding specified wholly-owned subsidiary			p. 138
9. Other			p. 139
∎ Consolidated Financial Statements and other related documents			p. 140
Consolidated Financial Statements			p. 140
Non-Consolidated Financial Statements			p. 143
Audit Report			p. 146
∎ Reference			p. 152
Policy regarding Mizuho Financial Group’s cross-shareholdings of other listed companies			p. 152

 

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Compatibility table for Corporate Governance Code

 

Code No.		Contents of code				Reference page
1.3		Basic strategy for capital policy				p. 11~13
1.4		Cross-shareholdings				p. 152~153
2.1, 3.1 i)		Disclosure of business principles, business strategies and business plan				p. 16~21, 66~78
2.3, 2.3.1		Sustainability issues, including social and environmental matters				p. 18~21, 71
2.4		Ensuring diversity, including active participation of women				p. 21
3.1 ii)		Basic view on corporate governance				p. 22
3.1 iii)		Policies and procedures for determining compensation for directors and executive officers				p. 26, 103~107
3.1 v)		Reasons for appointment as a director and an executive officer				p. 37~51, 99~102
4.1.2		State of achievement of mid-term business plan and analysis thereof				p. 7~9, 64~65
4.2, 4.2.1		Sound incentive in the compensation for directors and executive officers				p. 26, 103~107
4.7		Roles and responsibilities of independent outside directors				p. 22~25
4.8, 4.8.1		Effective use of independent outside directors				p. 22~25
4.9		Independence standards and qualification for independent outside directors				p. 54
4.11, 4.11.1		Views on the composition, diversity and expertise of directors for securing the effectiveness of the Board of Directors				p. 35~36
4.11.2		Number of directors with concurrent offices				p. 37~51, 93~95
4.11, 4.11.3		Analysis and evaluation of the effectiveness of the Board of Directors				p. 22~23

Note:    The above table shows policy excerpts from the Corporate Governance Code which are described in this convocation notice of the ordinary general meeting of shareholders.

 

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Forward-looking Statements

This material contains statements that constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995, including estimates, forecasts, targets and plans. Such forward-looking statements do not represent any guarantee by management of future performance.

In many cases, but not all, we use such words as “aim,” “anticipate,” “believe,” “endeavor,” “estimate,” “expect,” “intend,” “may,” “plan,” “probability,” “project,” “risk,” “seek,” “should,” “strive,” “target” and similar expressions in relation to us or our management to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions. These statements reflect our current views with respect to future events and are subject to risks, uncertainties and assumptions.

We may not be successful in implementing our business strategies, and management may fail to achieve its targets, for a wide range of possible reasons, including, without limitation: incurrence of significant credit-related costs; declines in the value of our securities portfolio; changes in interest rates; foreign currency fluctuations; decrease in the market liquidity of our assets; revised assumptions or other changes related to our pension plans; a decline in our deferred tax assets; the effect of financial transactions entered into for hedging and other similar purposes; failure to maintain required capital adequacy ratio levels; downgrades in our credit ratings; our ability to avoid reputational harm; our ability to implement our Medium-term Business Plan, realize the synergy effects of “One MIZUHO,” and implement other strategic initiatives and measures effectively; the effectiveness of our operational, legal and other risk management policies; the effect of changes in general economic conditions in Japan and elsewhere; and changes to applicable laws and regulations.

Further information regarding factors that could affect our financial condition and results of operations is included in “Item 3.D. Key Information—Risk Factors” and “Item 5. Operating and Financial Review and Prospects” in our most recent Form 20-F filed with the U.S. Securities and Exchange Commission (“SEC”) and our report on Form 6-K furnished to the SEC on December 26, 2018, both of which are available in the Financial Information section of our web page at www.mizuho-fg.com/index.html and also at the SEC’s web site at www.sec.gov.

We do not intend to update our forward-looking statements. We are under no obligation, and disclaim any obligation, to update or alter our forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by the rules of the Tokyo Stock Exchange.

 

6

We resolved structural issues ahead of schedule and maintained an adequate level of capital

∎ Highlight of financial results (consolidated)

 

 

Profit Attributable to Owners of Parent decreased significantly on a year-on-year basis due primarily to losses recorded in light of the structural reforms. Profit Attributable to Owners of Parent excluding disposal of one-time losses of JPY 695.4 billion, was JPY 581.8 billion, which was an increase on a year-on-year basis.

Regarding Consolidated Net Business Profits, while customer divisions showed increases worldwide, the markets division decreased primarily due to our efforts to ensure the soundness of our bond portfolio, including non-Japanese bonds.

Exceeded the target of the previous medium-term business plan.

 

7

∎ Previous medium-term business plan (financial targets)

 

 

8

		Previous medium-term         business plan FY2018     target		FY2018 (results)		FY2018 (results) (before disposal of one-time losses)
CET1 ratio1		Approx. 10%		10.71%		-
Consolidated ROE2		Approx. 8%		1.2%		7.4%
RORA (based on Profit Attributable to Owners of Parent)		Approx. 0.9%		0.1%		1.0%
Proportion of non-interest income3		Approx. 60%		56%		-
Cross-shareholding disposal4		JPY 550 billion reduction		JPY 543 billion reduction (approx. JPY 580 billion reduction on an agreement basis)		-
Expense ratio5		Approx. 60%		78.8%		71.1%

 

1.	Basel III fully-effective basis (based on current regulations), excluding Net Unrealized Gains on Other Securities.

2.	Excluding Net Unrealized Gains on Other Securities.

3.	The range of management account companies has changed since FY 2017 (the FY2015 result was unchanged).

4.	Shares listed on the Japanese stock markets, acquisition cost basis, cumulative amount from FY2015 to FY2018.

5.	Group aggregated.

 

(Reference) Details of losses in light of structural reform
Losses on Impairment of Fixed Assets		JPY 500.7 billion
Losses pertaining to the restructuring of securities portfolio and others		JPY 194.7 billion
Total		JPY 695.4 billion

 

9

An annual dividend of JPY 7.50 per share of common stock for fiscal year 2018 was paid as initially estimated at the beginning of this fiscal year

∎ Year-end cash dividend for fiscal year 2018

 

Annual cash dividend on common stock for fiscal year 2018: JPY 7.50 per share of common stock

 

		Cash dividend for FY2018 (annual dividend)				Amount of fiscal year-end cash dividend out of annual cash dividend
Cash dividend per share of common stock		JPY 7.50				JPY 3.75
Total cash dividend		JPY 190.3 billion				JPY 95.1 billion
Profit Attributable to Owners of Parent		JPY 96.5 billion

 

10

∎ As for our policy to return profits to shareholders for fiscal year 2018, we have implemented a steady dividend payout policy setting a dividend payout ratio on a consolidated basis of approximately 30% as a guide for our consideration.

∎ Our Board of Directors has considered thoroughly and decided to maintain the dividend for fiscal year 2018 at JPY 7.50 per share of common stock, although our net income declined significantly to JPY 96.5 billion in fiscal year 2018 as a result of recording losses in light of structural reform. To make such decision, our Board of Directors has considered that our Common Equity Tier 1 capital ratio, which is the foundation of fulfilling stable financial functions, exceeded the target of the previous medium-term business plan, i.e. 10% as of March 31, 2019, and that we aim to implement a steady dividend payout policy, and has taken into account our business environment comprehensively such as future earnings forecasts, profit base, status of capital adequacy, and domestic and international regulatory trends such as the Basel framework.

New policy to return profits to shareholders

 

 

We have been implementing disciplined capital management policy by pursuing the optimum balance between strengthening of stable capital base and steady returns to shareholders.

We revised our policy to return profits to shareholders based on our new business plan on this occasion.

 

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(New) policy to return profits to shareholders

We are maintaining the current level of dividends for the time being while aiming to strengthen our capital base further to enhance returns to shareholders at an early stage. We will comprehensively consider the business environment such as Mizuho Financial Group’s business results, profit base, status of capital adequacy, and domestic and international regulatory trends such as the Basel framework in determining the returns to shareholders for each term.

 

Points of revision

· The steady dividend payout policy, which we previously adopted and have pursued, is clearly expressed more than ever before.

· To aim for the enhancement of returns to shareholders in the future is clearly set forth in our policy.

- Share repurchases will be included as an available option in considering the means for enhancing returns to shareholders, according to the status of our capital and earnings.

 

12

The recent revisions to our policy to return profits to shareholders were determined by our Board of Directors after thorough consideration of various factors such as evaluation of our returns to shareholders in the past and the appropriateness of such revisions in light of our new business plan.

All of the directors will endeavor to engage in the management of Mizuho Financial Group, Inc. by fully understanding the significant responsibility that they bear as a result of having received the mandate of our shareholders, as well as by continuing to be keenly aware that they must make optimal decisions with respect to returns to shareholders from the perspective of the medium- to long-term interests of our shareholders.

 

13

 

 

14

Result of collaboration among banking, trust banking and securities functions

Joint offices (Japan)

 

 

 

 

15

Mizuho in the future

We have launched the 5-Year Business Plan – Transitioning to the Next Generation of Financial Services as our new business plan

∎ Our ideas embodied in the plan

Under the new business plan, we will promote forward-looking structural reforms focused on three interconnected areas: business structures, finance structures and corporate foundations in order to transition to the next generation of financial services by resolving the mismatch that have arisen in the allocation of corporate resources, such as branches and human resources, and respond to new customer needs.

To this end, we will combine the strengths that we have cultivated thus far using digitalization initiatives and the like in order to create new value incorporating both financial and non-financial products and services and enables us to forge new forms of partnerships with our customers.

Through these initiatives, we will build a stronger and more resilient financial group that our customers can depend on in the coming era.

∎ Framework of the new business plan

 

 

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∎ Five years to make the transition to the next generation of financial services

 

Digitalization initiatives to make the transition to the next generation of financial services

We are carrying out our digitalization initiatives to make the transition to the next generation of financial services by collaborating with companies outside the group and those in other industries.

Launch of J-Coin Pay, a smartphone payment service

We launched a new bank digital currency platform called J-Coin Pay, a smartphone payment service using QR codes, in cooperation with approximately 60 other financial institutions.

J-Coin Pay allows customers to make payments, send and receive transfers, and perform other financial transactions all on their smartphones. Customers are also able to use the J-Coin Pay smartphone app to move funds between their J-Coin Pay accounts and their deposit accounts at their financial institutions for free, anytime and anywhere. More financial institutions, users and affiliate merchants are to take part in the future.

AI-based solution for automating data processing

In terms of processing hand-written documents and non-standard forms, we successfully conducted proof-of-concept testing on a solution for the highly accurate digitization of character information using artificial intelligence (AI), optical character recognition (OCR) and robotic process automation (RPA) technology. Based on the results of the proof-of-concept testing on requests for direct debits from accounts, manual data-entry was reduced by approximately 80%.

With the aim to improve the operational efficiency of the entire financial industry, we started collaborating with regional financial institutions that utilize this solution.

 

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To bring fruitfulness to each customer and the economies, industries and the societies in which we operate, over the next 10 years and beyond

∎ Values to be brought to our stakeholders

Through the initiatives under the new business plan, we will create new value for our stakeholders.

 

∎ Sustainability for Mizuho Financial Group

From the standpoint of creating economic, industrial and social value through sustainable and stable growth, we will select our key sustainability areas and take proactive approaches to achieving the SDGs (Sustainable Development Goals).

 

Sustainability for Mizuho Financial Group		Achieving sustainable and stable growth for the group, and through this growth, contributing to the sustainable development and prosperity of the economy, industry, and society around the world

Process for selecting key sustainability areas

 

What are SDGs?

The SDGs (Sustainable Development Goals) are a collection of 17 goals, adopted at the United Nations Sustainable Development Summit in September 2015, which aim at creating a sustainable society by 2030. In Japan, initiatives to achieve the SDGs are being promoted not only by the Japanese government, but also by many companies and other organizations.

 

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Key sustainability areas

 

Business				Declining birthrate and aging of the population, health and lengthening lifespans		•  Asset formation for the future   •  Expansion of our services in response to the declining birthrate and aging of the population   •  Greater convenience in response to diversification of lifestyles		Creating alliances and collaborative relationships with a diverse range of stakeholders
				Industrial development and innovation		•  Supporting smooth business succession   •  Responding to changes in industrial structures   •  Making further progress in innovation   •  Activating economic communities in Asian economies   •  Building resilient infrastructure
				Sound economic growth		•  Strengthening the function of global financial and capital markets   •  Shifting to a cashless society   •  Creating social systems based on environmental changes
				Environmental consciousness		•  Ensuring a stable energy supply and responding to climate change

 

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Business   foundations				Governance		•  Enhancement of corporate governance   •  Risk management, improvement of our IT systems and compliance   •  Disclosure of information in a fair, timely and appropriate manner in conjunction with dialogue with our stakeholders
				Personnel		•  Talent development and creation of a rewarding workplace environment
				Environment and society		•  Respecting human rights and being conscious of the environment in investment and financing.   •  Responding to climate change   •  Promoting financial and economic education and social and local contribution activities

 

20

 

21

We have established our characteristic governance system in order to pursue increased effectiveness

Governance system

Directors who have received the mandate of the shareholders of Mizuho Financial Group have established our characteristic governance system with distinct features.

∎ Principal features of our governance system

 

		•  A Company with Three Committees structure has been adopted.
		-  Capable of providing the most effective performance of the functions of the Board of Directors, the three legally-required committees and executive officers as defined in the Companies Act.
		•  Separation of supervision and execution
Structure		-  Making supervision of the management the primary focus of the Board of Directors and delegating decisions on business execution to executive officers as defined in the Companies Act, to the maximum extent possible.
		•  The Chairman of the Board of Directors shall be an outside director.
		-  The core members of the Board of Directors are outside directors.
		•  The members of the Nominating and Compensation Committees shall all be outside directors.
Fairness and   transparency		•  The Chairmen of the Nominating, Compensation and Audit Committees shall all be outside directors.
		-  Decision making with respect to matters such as appointment and dismissal of the management and the compensation therefor, will be conducted mainly by outside directors.
		•  Appropriate disclosure based on the Corporate Governance Code.

Efforts toward improvement in effectiveness of the Board of Directors

We make efforts to carry out high-quality discussions at the Board of Directors meetings by means of conducting Outside Director Sessions and offsite meetings regarding business operations and holding other opportunities for discussion.

 

22

Outside Director Sessions

 

Fiscal     year		Number of       meetings		Details
2018		2 meetings		Exchanged opinions concerning the manner of operation of the Board of Directors, how to proceed with evaluation of the effectiveness of the Board of Directors and formulation of the new business plan, and discussed other issues.

Offsite meetings regarding business operations

 

Fiscal     year		Number of       meetings		Details
2018		21 meetings		Discussed the new business plan, major management issues, major issues at each company and other topics.

∎ Outline of each structure and operation status in FY 2018 of the Board of Directors and the three legally-required committees

 

Board of Directors		The Chairman of the Board of Directors is an outside director.   The majority of the Board of Directors are non-executive directors.
The Board of Directors makes decisions on business execution such as the basic management policy and supervises directors and executive officers as defined in the Companies Act.
Operational status   The Board of Directors held 14 meetings in the fiscal year 2018 and had high-quality discussions regarding issues in relation to the formulation of the new business plan and other subjects. In addition, the Board of Directors received reports on such topics as the status of risk governance, risk management, compliance and internal audit.
Areas of expertise of outside directors   Management Law Finance / accounting Economic and fiscal policy

 

23

Nominating Committee		All of the members are outside directors.

The Nominating Committee, among other things, makes decisions on the content of proposals regarding the appointment and dismissal of directors that are submitted to general meetings of shareholders.
Operational status   The Committee held 8 meetings in the fiscal year 2018 and, aside from conducting other matters, decided on the candidates for directors of Mizuho Financial Group and approved the selection of directors of the Three Core Companies. In addition, the Committee received reports on the status of formulation and operation of the succession plan and asked for advice thereon.   Areas of expertise of outside directors   Management Law Economic and fiscal policy

 

Compensation Committee		All of the members are outside directors.

The Compensation Committee determines the policy for determination of executive compensation and the compensation for each individual director and executive officer (as defined in the Companies Act) of Mizuho Financial Group and conducts other matters.
Operational status   The Committee held 11 meetings in the fiscal year 2018 and identified issues regarding the executive compensation system for Mizuho Financial Group and the Three Core Companies and revised it accordingly. Aside from conducting other matters, the Committee also decided on the compensation of individual directors and executive officers as defined in the Companies Act of Mizuho Financial Group and approved the compensation of individual directors of the Three Core Companies.   Areas of expertise of outside directors   Management Law Finance / accounting

 

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Audit Committe		The majority of the members are outside directors.

The Audit Committee audits the legality and appropriateness of the execution of duties by directors and executive officers as defined in the Companies Act.
Operational status   The Committee held 17 meetings in the fiscal year 2018 and received reports on such matters as the circumstances regarding the execution of duties by directors and executive officers as defined in the Companies Act, including the management administration for the group companies. Receiving the reports, the Committee principally confirmed the effectiveness of the Structure for Ensuring Appropriate Conduct of Operations (internal control system) and provided opinions in a timely manner.
Areas of expertise of outside directors   Management Law Finance / accounting

 

25

Executive compensation system revised in order to ensure an attitude towards improvement of corporate value shared with shareholders

∎ Compensation system for executives responsible for business execution

Mainly intending to increase the incentive for each officer to fulfill their designated function to the fullest for the purpose of improving corporate value, we revised the compensation system in July 2018, as follows:

Please see pages 104~105 for details of the compensation system.     

 

Compensation system

•  Designed so that Performance Payments and part of Stock Compensation are linked to the consolidated net business profits and other bases in order to function as an incentive for improving corporate value.

•  The percentage of Stock Compensation is set to be over 30%.

<Compensation system for executives responsible for business execution (image)>

 

Compensation determination process taken by outside directors

The Compensation Committee, comprised exclusively of outside directors all of whom are sufficiently independent from the management of the group, is deeply involved in the process of determining executive compensation and ensuring both the objectivity and transparency of that process.

 

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Members of the Compensation Committee (all of which are outside directors)

 

Chairman
Tatsuo Kainaka		Tetsuo Seki		Takashi Kawamura		Hirotake Abe
Major personal history		Major personal history		Major personal history		Major personal history
∎ Superintending Prosecutor of the Tokyo High Public Prosecutors Office ∎ Justice of the Supreme Court ∎ Attorney-at-law (current)		∎ Director, Representative Director and Executive Vice President of Nippon Steel Corporation ∎ President (Representative Director) of the Shoko Chukin Bank, Ltd.		∎ Representative Executive Officer, Chairman, President and Chief Executive Officer and Director of Hitachi, Ltd.		∎ CEO of Tohmatsu & Co. ∎ Certified public accountant (current)

<Process to determine Executive compensation and the Compensation Committee’s involvement therein (image)>

 

* Directors and executive officers as defined in the Companies Act of the Company and the Three Core Companies (Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co., Ltd.) are eligible.

 

27

Our initiatives have been recognized highly by various external institutions

 

Customer first principle

In the R&I Customer-oriented Investment Trust Sales Company Rating by Rating and Investment Information, Inc., which examines how financial enterprises operate their customer-oriented business operations, all four companies – Mizuho Financial Group, Inc., Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co., Ltd. – earned a rating of S, which is the highest rating among the companies examined in 2018.

 

Financial innovation
We were selected as a Competitive IT Strategy Company Stock for the third consecutive year by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange. We were recognized for our active efforts to strengthen our competitiveness and create new value through technological innovation.				Our initiatives regarding cybersecurity and the like earned the IT Promotion Award in the 36th IT Awards competition held by the Japan Institute of Information Technology.

 

Encouraging the active participation of our workforce
We were selected under the 2019 Health & Productivity Stock Selection, which is jointly administered by the Ministry of Economy, Trade and Industry and the Tokyo Stock Exchange. We were recognized for our approach to employee health and well being by putting into practice strategic workforce health management initiatives.				We were recognized as being actively engaged in promoting the participation of our female employees, and received Nadeshiko Brand designation, conferred jointly by Japan’s Ministry of Economy, Trade and Industry, and the Tokyo Stock Exchange.
Our initiatives to create a more inclusive environment for LGBT and other sexual minorities earned, for the third consecutive year, a top rating of gold in the Pride Index by work with Pride, a voluntary Japanese organization that supports the establishment and promotion of LGBT-related diversity management.

 

Disclosures

We received various awards in recognition of our proactive and advanced online disclosure practices. Our website was recognized for containing in-depth information and being easy to use and understand.

 

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We respond sincerely to the voices of our shareholders

We are actively working to enhance two-way communication with our shareholders by utilizing the general meetings of shareholders, publication of booklets and other means. In this section, we will report on the most recent general meeting of shareholders and the valuable comments we have received from our shareholders.

∎ The 16th ordinary general meeting of shareholders (held on June 22, 2018)

 

· Outline of general meeting of shareholders
Place			Tokyo International Forum
Number of shareholders present			279,780
Number of shareholders attended			2,246
Number of shareholders who asked questions or made comments			10

· Principal questions involved:

•

Approach to improving stock prices

•

Differentiation strategy in the technology field

•

Rationale of the Nominating Committee for selection of the Group CEO

· Questionnaire results

 

We obtained answers from 1,324 shareholders at the venue.

We sincerely appreciate the cooperation of our shareholders. The following is a selection of results from this questionnaire:

Understandability of the explanations provided

· Was the business report understandable? (Here, we show the result regarding the understandability of the report by the President):

 

 

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· Were the officers’ answers to questions understandable?

 

How did your impression of Mizuho Financial Group change after this general meeting of shareholders?

 

In addition to the above, we received valuable comments from approximately 620 shareholders regarding matters such as the meeting proceedings, answers to questions, and procedures and guidance given at the reception desk.

 

While we received praise from many shareholders, such as “easy to understand” and “satisfactory,” we also received comments that requested we make an effort to further enhance the general meetings of shareholders. We will continue to strive to conduct the general meeting of shareholders in a more understandable manner and to encourage our shareholders to support us.

∎ Shareholders’ newsletter (the 17th interim period report to our shareholders issued in December 2018)

We truly appreciate the valuable comments we received from 4,787 shareholders. We will incorporate them in our future publications and IR activities.

Was the newsletter understandable?

 

 

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How did your impression of Mizuho Financial Group change after reading the newsletter?

 

Additional comments (from approximately 1,350 shareholders)

The comments were primarily related to the following issues:

· Content and layout of the shareholder’s newsletter

· Fintech

· Dividend and stock prices

· Messages of encouragement to Mizuho Financial Group

 

As our effort to improve understandability by increasing usage of charts and commentaries, increasing the font size and utilizing other methods was well received, we have worked to make this convocation notice more understandable based on such response from our shareholders.

 

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(Securities code: 8411)

June 3, 2019

To our shareholders

CONVOCATION NOTICE OF

THE 17TH ORDINARY GENERAL MEETING OF SHAREHOLDERS

Please be advised that the 17th Ordinary General Meeting of Shareholders of Mizuho Financial Group, Inc. will be held as set forth below. You are cordially invited to attend the meeting.

If you are not able to attend the meeting, please exercise your voting rights by mail or via the Internet after examining the reference materials for the ordinary general meeting of shareholders set forth below (pages 35 through 57).

Tatsufumi Sakai

Member of the Board of Directors

President & Group CEO

Mizuho Financial Group, Inc.

5-5, Otemachi 1-chome,

Chiyoda–ku, Tokyo

 

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Details
1.		Date and time:				10:00 a.m. on Friday, June 21, 2019 (doors open at 9:00 a.m.)
2.		Venue:				Tokyo International Forum (Hall A)
						5-1, Marunouchi 3-chome, Chiyoda-ku, Tokyo
3.		Purpose of the Meeting:
		Matters to be reported:				Report on the Business Report for the 17th fiscal year (from April 1, 2018 to March 31, 2019), on the consolidated financial statements, on the financial statements and on the Results of Audit of the Consolidated Financial Statements by the Independent Auditors and the Audit Committee
		Matters to be resolved:
		Company’s Proposal (Proposal 1)
		Proposal made by the Nominating Committee
		Proposal 1:				Appointment of fourteen (14) directors
		Shareholders’ Proposal (Proposal 2)
		Proposal made by a certain shareholder
		Proposal 2:				Partial amendment to the Articles of Incorporation (renouncement of the qualification of JGB Market Special Participant)
		The Board of Directors opposes this proposal.

-End of notice-

 

 

 

∎

Any corrections made to the reference materials for the ordinary general meeting of shareholders, the business report, the consolidated financial statements and the non-consolidated financial statements shall be announced on our website.

Our website: https://www.mizuho-fg.com/

(or enter “Mizuho FG” into a search engine)

 

33

Notes:

 

·

If you exercise your voting rights twice, in writing and via the Internet, we will only accept the exercise of your voting rights via the Internet as effective.

 

·

If you exercise your voting rights more than once via the Internet, we will only accept the last exercise of your voting rights as effective.

 

 

Information regarding the general meeting of shareholders

 

∎

In the case of attendance by proxy, please appoint as a proxy one of the shareholders holding voting rights at this general meeting of shareholders, and submit the document certifying the authority of such proxy.

 

∎

No gifts to shareholders will be given on the meeting day.

We appreciate your cooperation to conduct the general meeting of shareholders as smoothly as possible. As the reception at the entrance to the venue is expected to be crowded just prior to the start of the meeting, we encourage you to arrive early in order to mitigate congestion.

 

34

[Translation]

Reference materials for the General Meeting of Shareholders

Company’s proposal

Proposal 1: Appointment of fourteen (14) directors

Of the fourteen (14) directors appointed at the 16th Ordinary General Meeting of Shareholders, Messrs. Takanori Nishiyama and Yasuyuki Shibata resigned as directors as of April 1, 2019, and the term of office of the other twelve (12) directors will expire at the closing of this ordinary general meeting of shareholders. Therefore, we propose the appointment of fourteen (14) directors in accordance with the determination by the Nominating Committee.

Among the fourteen (14) candidates for directors, twelve (12) candidates are male and two (2) candidates are female (percentage of female candidates is 14%).

 

Candidate No.				Name		Year of appointment		Chair of the Board		Current title and assignment at Mizuho Financial Group
1		Reappointment		Tatsufumi Sakai		2018		—		President & Group CEO (Representative Executive Officer ) Member of the Board of Directors
2		New appointment		Satoshi Ishii				—		Senior Managing Executive Officer Chief Digital Innovation Officer / CDIO Head of IT & Systems Group / Group CIO Head of Operations Group / Group COO
3		Reappointment		Makoto Umemiya		2017		—		Managing Executive Officer Head of Financial Control & Accounting Group / Group CFO Member of the Board of Directors
4		New appointment		Motonori Wakabayashi				—		Managing Executive Officer Head of Research & Consulting Unit Head of Risk Management Group / Group CRO
5		New appointment		Hiroaki Ehara				—		Managing Executive Officer Head of Human Resources Group / Group CHRO
6		Reappointment / Internal Non- Executive Director		Yasuhiro Sato		2009		—		Member of the Board of Directors, Chairman (Kaicho) (Note)
7		New appointment / Internal Non- Executive Director		Hisaaki Hirama				—		Advisor to Audit Committee
8		New appointment / Internal Non- Executive Director		Masahiro Kosugi				—		Advisor to Audit Committee

Note: Chairman (Kaicho) Sato engages in our external activities, but does not chair the Board meetings. The Board meetings are chaired by the independent director chair Ota.

 

35

All six (6) outside directors satisfy the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group. (For an overview of the independence standards above, please see page 54.)

 

Candidate No.

Name

Year of appointment

Chair of the Board

Current title and assignment at Mizuho Financial Group

Area of expertise which we expect candidates for directors to have*

Committee Membership

Corporate Manage- ment

Law

Finance and Accounting

Economic Policy

Finance

Tech- nology

Nominating

Compensation

Audit

Risk

9

Reappointment / Independent Outside Director

Tetsuo Seki

2015

—

Member of the Board of Directors

Member

Member

Chair

10

Reappointment / Independent Outside Director

Tatsuo Kainaka

2014

—

Member of the Board of Directors

Member

Chair

Member

11

Reappointment / Independent Outside Director

Hirotake Abe

2015

—

Member of the Board of Directors

Member

Member

12

New appointment / Independent Outside Director

Masami Yamamoto

—

13

Reappointment / Independent Outside Director

Hiroko Ota

2014

Chair

Member of the Board of Directors

Member

14

Reappointment / Independent Outside Director

Izumi Kobayashi

2017

—

Member of the Board of Directors

Member

Member

 

*	The above list is not exhaustive and does not show all areas of expertise for which candidates for director have.

 

36

Candidate No. 1		Tatsufumi Sakai		Reappointment
Date of birth		August 27, 1959 (Age 59)
Current title and assignment at Mizuho Financial Group		President & Group CEO (Representative Executive Officer) Member of the Board of Directors
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 337,217 shares Potential number of additional shares of common stock to be held: 183,684 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)2		The Board of Directors: 12/12 meetings (100%)
Term in office as a director		1 year (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in corporate planning, investment banking business planning, international business planning and other matters as a member of the group since 1984. Moreover, he has abundant management experience as the Group CEO and the President & CEO of Mizuho Securities Co., Ltd. We have selected him as a candidate for director based on the role delegated to him as the head of business execution and because the utilization, as a member of the Board of Directors, of his experience and expert knowledge is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

April 2011		Executive Officer, Senior Corporate Officer of Strategic Planning Group of CB
April 2012		Executive Officer, General Manager of Group Planning Division of FG Executive Officer, General Manager of Group Planning Division of BK Executive Officer, General Manager of Group Planning Division of CB
April 2013		Managing Executive Officer, Head of Investment Banking Unit of FG Managing Executive Officer, Head of Investment Banking Unit and in charge of Business Collaboration Division (Securities & Trust Services) of BK Managing Executive Officer, Head of Investment Banking Unit and in charge of Business Collaboration Division (Securities & Trust Services) of CB
April 2014		Managing Executive Officer, Head of International Banking Unit of FG Managing Executive Officer, Head of International Banking Unit of BK
April 2016		President & CEO of SC
April 2018		President & Group CEO of FG (Member of the Board of Directors / President & Group CEO from June 2018) (current) Member of the Board of Directors of BK (current) Member of the Board of Directors of TB (current) Member of the Board of Directors of SC (current)

 

37

Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. CB: Mizuho Corporate Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd. SC: Mizuho Securities Co., Ltd.

Status of major concurrent offices

Member of the Board of Directors of Mizuho Bank, Ltd.

Member of the Board of Directors of Mizuho Trust & Banking Co., Ltd.

Member of the Board of Directors of Mizuho Securities Co., Ltd.

 

38

Candidate No. 2		Satoshi Ishii		New appointment
Date of birth		September 1, 1963 (Age 55)
Current title and assignment at Mizuho Financial Group		Senior Managing Executive Officer Chief Digital Innovation Officer / CDIO Head of IT & Systems Group / Group CIO Head of Operations Group / Group COO
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 217,206 shares Potential number of additional shares of common stock to be held: 142,992 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in human resources planning, international business planning, business promotion and other matters as a member of the group since 1986. We have selected him as a candidate for director based on the role delegated to him as Chief Digital Innovation Officer, Head of IT & Systems Group and Head of Operations Group, and because the utilization, as a member of the Board of Directors, of his experience and expert knowledge is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

April 2014		Executive Officer, General Manager of Corporate Secretariat of FG Executive Officer, General Manager of Corporate Secretariat of BK
April 2015		Managing Executive Officer, Head of Human Resources Group of FG Managing Executive Officer, Head of Human Resources Group of BK
April 2017		Senior Managing Executive Officer, Head of Business Promotion of BK
April 2019		Senior Managing Executive Officer, Chief Digital Innovation Officer, Head of IT & Systems Group and Head of Operations Group of FG (current) Deputy President & Executive Officer, In charge of Digital Innovation Department, Head of IT & Systems Group and Head of Operations Group of BK (current)
Definitions:
FG: Mizuho Financial Group, Inc.
BK: Mizuho Bank, Ltd.

Status of major concurrent office

Deputy President & Executive Officer of Mizuho Bank, Ltd.

 

39

Candidate No. 3		Makoto Umemiya		Reappointment
Date of birth		December 23, 1964 (Age 54)
Current title and assignment at Mizuho Financial Group		Managing Executive Officer Head of Financial Control & Accounting Group / Group CFO Member of the Board of Directors
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 52,749 shares Potential number of additional shares of common stock to be held: 107,228 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%)
Term in office as a director		2 years (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in financial planning, portfolio management, business promotion and other matters as a member of the group since 1987. We have selected him as a candidate for director based on the role delegated to him as the Head of the Financial Control & Accounting Group and because the utilization, as a member of the Board of Directors, of his experience and expert knowledge is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

April 2012		General Manager of Osaka Branch of BK
April 2014		General Manager of Financial Planning Division of FG General Manager of Financial Planning Division of BK
April 2015		Executive Officer, General Manager of Financial Planning Department of FG Executive Officer, General Manager of Financial Planning Department of BK
April 2017		Managing Executive Officer, Head of Financial Control & Accounting Group of FG (Member of the Board of Directors, Managing Executive Officer from June 2017) (current) Executive Managing Director, Head of Financial Control & Accounting Group of BK (Managing Executive Officer from April 2019) (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd.

Status of major concurrent office

Executive Managing Officer of Mizuho Bank, Ltd.

 

40

Candidate No. 4		Motonori Wakabayashi		New appointment
Date of birth		August 13, 1964 (Age 54)
Current title and assignment at Mizuho Financial Group		Managing Executive Officer Head of Research & Consulting Unit Head of Risk Management Group / Group CRO
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 33,122 shares Potential number of additional shares of common stock to be held: 128,575 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in research & consulting business, business promotion, corporate credit supervision and other matters as a member of the group since 1987. We have selected him as a candidate for director based on the role to be delegated to him as the Head of Research & Consulting Unit and Head of Risk Management Group and because the utilization, as a member of the Board of Directors, of his experience and expert knowledge is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

April 2013		General Manager of Industry Research Division of BK General Manager of Industry Research Division of CB
April 2015		Executive Officer, General Manager of Industry Research Division of BK
April 2016		Managing Executive Officer, Deputy Head of Research & Consulting Unit of FG Managing Executive Officer, Head of Research & Consulting Unit and In charge of Banking of BK
April 2018		Managing Executive Officer, Head of Research & Consulting Unit of FG Managing Executive Officer, Head of Research & Consulting Unit of BK
April 2019		Managing Executive Officer, Head of Research & Consulting Unit and Head of Risk Management Group of FG (current) Managing Executive Officer, Head of Research & Consulting Unit and Head of Risk Management Group of BK (current) Managing Executive Officer, Head of Risk Management Group of TB (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. CB: Mizuho Corporate Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd.

Status of major concurrent office

Managing Executive Officer of Mizuho Bank, Ltd.

Managing Executive Officer of Mizuho Trust & Banking Co., Ltd.

President & CEO of Mizuho Research Institute Ltd. (Mr. Wakabayashi is expected to assume this position in late June 2019)

 

41

Candidate No. 5		Hiroaki Ehara		New appointment
Date of birth		February 5, 1965 (Age 54)
Current title and assignment at Mizuho Financial Group		Managing Executive Officer Head of Human Resources Group / Group CHRO
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 60,435 shares Potential number of additional shares of common stock to be held: 111,350 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in human resources planning, operations planning, business promotion, internal audits and other matters as a member of the group since 1987. We have selected him as a candidate for director based on the role to be delegated to him as the Head of the Human Resources Group and because the utilization, as a member of the Board of Directors, of his experience and expert knowledge is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

April 2013		General Manager of Sapporo Branch of TB
April 2015		Executive Officer, General Manager of Trust Business Department VI of TB
April 2016		Managing Executive Officer, Joint Head of Human Resources Group and Joint Head of Internal Audit Group of FG Executive Managing Director, Head of Human Resources Group and Head of Internal Audit Group of TB
April 2019		Managing Executive Officer, Head of Human Resources Group of FG (current) Managing Executive Officer, Head of Human Resources Group of BK (current) Managing Executive Officer, Head of Human Resources Group of TB (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd.

Status of major concurrent office

Managing Executive Officer of Mizuho Bank, Ltd.

Managing Executive Officer of Mizuho Trust & Banking Co., Ltd.

 

42

Candidate No. 6		Yasuhiro Sato		Reappointment Non-Executive Director
Date of birth		April 15, 1952 (Age 67)
Current title and assignment at Mizuho Financial Group		Chairman (Kaicho), Member of the Board of Directors* * Chairman (Kaicho) Sato engages in our external activities, but does not chair the Board meetings. The Board meetings are chaired by the independent director chair Ota.
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 954,642 shares Potential number of additional shares of common stock to be held: 581,420 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%)
Term in office as a director		10 years (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in corporate planning, international business planning, business promotion and other matters as a member of the group since 1976. Moreover, he has abundant management experience as the Group CEO and President & CEO of Mizuho Bank, Ltd. We have selected him as a candidate for director because the utilization, as a member of the Board of Directors, of his experience and expert knowledge in his position as director who does not concurrently serve as executive officer is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

Brief personal record

 

March 2003		Executive Officer / Senior Corporate Officer of International Banking Unit of CB
April 2004		Managing Executive Officer in charge of business promotion
March 2006		Executive Managing Director / Head of Corporate Banking Unit
April 2007		Deputy President / Chief Auditor
April 2009		President & CEO (until July 2013)
June 2009		Member of the Board of Directors of FG
June 2011		Member of the Board of Directors of BK President & Group CEO of FG (until June 2014)
July 2013		President & CEO of BK
April 2014		Member of the Board of Directors (until April 2018) Member of the Board of Directors of TB (until April 2018) Member of the Board of Directors of SC (until April 2018)
June 2014		Member of the Board of Directors, President & Group CEO of FG
April 2018		Chairman, Member of the Board of Directors, Executive Officer (Chairman, Member of the Board of Directors from June 2018) (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd. CB: Mizuho Corporate Bank, Ltd. TB: Mizuho Trust & Banking Co., Ltd. SC: Mizuho Securities Co., Ltd.

Status of major concurrent office

None

 

43

Candidate No. 7		Hisaaki Hirama		New appointment / Internal Non-Executive Director
Date of birth		December 26, 1962 (Age 56)
Current title and assignment at Mizuho Financial Group		Advisor to Audit Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 130,941 shares Potential number of additional shares of common stock to be held: 78,660 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in accounting, business promotion, internal audits and other matters as a member of the group since 1986. We have selected him as a candidate for director because the utilization, as a member of the Board of Directors, of his experience and expert knowledge in his position, as a director who does not concurrently serve as an executive officer is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

He has considerable expert knowledge concerning finance and accounting, which he gained through his experiences and career as General Manager of Accounting Department of Mizuho Financial Group and General Manager of Accounting Department of Mizuho Bank, Ltd.

Brief personal record

 

April 2014		Executive Officer, General Manager of Marunouchi-Chuo Branch Division No.1 of BK
April 2015		Executive Officer, General Manager of Nagoya Corporate Branch of BK
April 2017		Managing Executive Officer, Deputy Head of Internal Audit Group of FG Managing Executive Officer, Head of Internal Audit Group of BK
April 2019		Advisor to Audit Committee of FG (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd.

Status of major concurrent office

None

 

44

Candidate No. 8		Masahiro Kosugi		New appointment / Internal Non-Executive Director
Date of birth		July 4, 1965 (Age 53)
Current title and assignment at Mizuho Financial Group		Advisor to Audit Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 44,139 shares Potential number of additional shares of common stock to be held: 0 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)

Reason for selection as a candidate for director:

He is well-acquainted with the overall business, and has abundant business experience, having been engaged in accounting, portfolio management and other matters as a member of the group since 1989. We have selected him as a candidate for director because the utilization, as a member of the Board of Directors, of his experience and expert knowledge in his position, as a director who does not concurrently serve as an executive officer is expected to strengthen the effectiveness of both the decision-making and supervisory functions of the Board of Directors.

He has considerable expert knowledge concerning finance and accounting, which he gained through his experiences and career as General Manager of Accounting Department of Mizuho Financial Group Inc. and General Manager of Accounting Department of Mizuho Bank, Ltd.

Brief personal record

 

April 2014		General Manager of Portfolio Management Division of FG General Manager of Portfolio Management Division of BK
April 2016		General Manager of Accounting Department of FG General Manager of Accounting Department of BK
April 2018		Executive Officer, General Manager of Accounting Department of FG Executive Officer, General Manager of Accounting Department of BK
April 2019		Advisor to Audit Committee of Mizuho Financial Group, Inc. (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd.

Status of major concurrent office

None

 

45

Candidate No. 9		Tetsuo Seki		Reappointment / Independent Outside Director
Date of birth		July 29, 1938 (Age 80)
Current title and assignment at Mizuho Financial Group		Member of the Board of Directors Member of the Nominating Committee Member of the Compensation Committee Chairman of the Audit Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 46,500 shares Potential number of additional shares of common stock to be held: 11,200 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%) The Nominating Committee: 8/8 meetings (100%) The Compensation Committee: 11/11 meetings (100%) The Audit Committee: 17/17 meetings (100%)
Term in office as a director		4 years (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Corporate management Finance and accounting Finance

Reason for selection as a candidate for director:

He has served as Representative Director and Executive Vice President of Nippon Steel Corporation; President (Representative Director) of the Shoko Chukin Bank, Ltd.; Chairperson of the Japan Corporate Auditors Association; and Chairperson of the Audit Committee of Japan Post Holdings Co., Ltd. We propose to appoint him as an outside director based on our conclusion that he will be able to significantly contribute to, among other matters, (i) strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, and (ii) our efforts to further enhance internal control systems and group governance, from a perspective independent from that of the management, leveraging his extensive experience and deep insight as a senior executive.

He has considerable expert knowledge concerning finance and accounting which he gained through his experiences and career as CFO of Nippon Steel Corporation, Chairperson of the Japan Corporate Auditors Association and a member of the Audit Committee of Mizuho Financial Group.

Candidate’s independence

He satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

Activities on the Board of Directors and committees

By leveraging his extensive experience and deep insight as a senior executive, he proactively made suggestions concerning, among other matters, (i) increasing our fundamental earnings power, (ii) appropriate allocation of human resources based on our business strategies, (iii) how effective performance evaluations should be structured and (iv) direction of the new business plan based on our structural reforms.

Brief personal record

 

April 1963		Joined Yawata Iron & Steel Co., Ltd.
June 1993		Director of Nippon Steel Corporation
April 1997		Managing Director
April 2000		Representative Director and Executive Vice President
June 2003		Executive Advisor
June 2004		Senior Corporate Auditor
June 2006		Independent Director of Terumo Corporation (until September 2008)
March 2007		Outside Director of Sapporo Holdings Limited (until September 2008)
June 2007		Outside Director of Tokyo Financial Exchange Inc. (until September 2008)
October 2007		Chairperson of the Japan Corporate Auditors Association (until October 2008) Outside Director of Japan Post Holdings Co., Ltd. (until September 2008)
June 2008		Executive Advisor to Nippon Steel Corporation (until September 2008)
October 2008		President (Representative Director) of the Shoko Chukin Bank, Ltd.
June 2013		General Advisor (current)
June 2015		Member of the Board of Directors (Outside Director) of Mizuho Financial Group (current)
March 2016		Audit & Supervisory Board Member of Sapporo Holdings Limited (current)

Status of major concurrent office

Audit & Supervisory Board Member of Sapporo Holdings Limited

 

46

Candidate No. 10		Tatsuo Kainaka		Reappointment / Independent Outside Director
Date of birth		January 2, 1940 (Age 79)
Current title and assignment at Mizuho Financial Group		Member of the Board of Directors Member of the Nominating Committee Chairman of the Compensation Committee Member of the Audit Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 25,000 shares Potential number of additional shares of common stock to be held: 11,200 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%) The Nominating Committee: 8/8 meetings (100%) The Compensation Committee: 11/11 meetings (100%) The Audit Committee: 17/17 meetings (100%)
Term in office as a director		5 years (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Law

Reason for selection as a candidate for director:

He has served in positions such as Superintending Prosecutor of the Tokyo High Public Prosecutors Office and Justice of the Supreme Court, and he is currently active as an attorney-at-law. We propose to appoint him as an outside director based on our conclusion that he will be able to significantly contribute to, among other matters, (i) strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, and (ii) the further enhancement of our corporate governance, compliance and risk management framework, from a perspective independent from that of the management, leveraging his extensive experience, deep insight and high level of expertise.

Although he has not previously been engaged in management of a company other than in his career as an outside director and outside audit & supervisory board member, we believe he will fulfill the duties of an outside director of Mizuho Financial Group appropriately due to the reasons stated above.

Candidate’s independence

He satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

The relationship between him, as attorney-at-law, and the group does not affect his independence, for reasons including that neither he nor the law office to which he belongs, i.e., Takusyou Sogo Law Office, have received any money or proprietary benefit from the group other than the compensation he receives as an outside director of Mizuho Financial Group.

Activities on the Board of Directors and committees

By leveraging his extensive experience, deep insight and high level of expertise as a Public Prosecutor, judge, and attorney-at-law, he proactively made suggestions concerning, among other matters, (i) proper allocation of human resources responding to the volume of business, (ii) employee satisfaction with regards to working in the group and (iii) improvement plans based on the analysis of causes of crisis.

Brief personal record

 

April 1966		Appointed as Public Prosecutor
January 2002		Superintending Prosecutor of the Tokyo High Public Prosecutors Office
October 2002		Justice of the Supreme Court
March 2010		Admitted to the Tokyo Bar Association
April 2010		Joined Takusyou Sogo Law Office (current)
January 2011		President of the Life Insurance Policyholders Protection Corporation of Japan (current)
November 2013		Member of the Board of Directors (Outside Director) of BK (until June 2014)
June 2014		Member of the Board of Directors (Outside Director) of FG (current)
Definitions: FG: Mizuho Financial Group, Inc. BK: Mizuho Bank, Ltd.

Status of major concurrent offices

Attorney-at-law at Takusyou Sogo Law Office

President of the Life Insurance Policyholders Protection Corporation of Japan

Corporate Auditor (External) of Oriental Land Co., Ltd.

 

47

Candidate No. 11		Hirotake Abe		Reappointment / Independent Outside Director
Date of birth		November 13, 1944 (Age 74)
Current title and assignment at Mizuho Financial Group		Member of the Board of Directors Member of the Compensation Committee Member of the Audit Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 46,500 shares Potential number of additional shares of common stock to be held: 11,200 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%) The Compensation Committee: 11/11 meetings (100%) The Audit Committee: 17/17 meetings (100%)
Term in office as a director		4 years (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Finance and accounting

Reason for selection as a candidate for director:

He has served in positions such as CEO of Tohmatsu & Co., and he is currently active as a certified public accountant. We propose to appoint him as an outside director based on our conclusion that he will be able to significantly contribute to, among other matters, strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, from a perspective independent from that of the management, leveraging his extensive experience, deep insight and high level of expertise.

Although he has not previously been engaged in management of a company other than in his career as an outside director and an outside audit & supervisory board member, we believe he will fulfill the duties of an outside director of Mizuho Financial Group appropriately due to the reasons stated above and his considerable expert knowledge concerning finance and accounting as a certified public accountant.

Candidate’s independence

He satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

With respect to the relationship between him, as a certified public accountant, and the group, neither he nor the accounting office to which he belongs, i.e., Certified Public Accountant Hirotake Abe Office, have received any money or proprietary benefit from the group other than the compensation he receives as an outside director of Mizuho Financial Group.

Activities on the Board of Directors and committees

By leveraging his extensive experience, deep insight and high level of expertise as a certified public accountant, he proactively made suggestions concerning, among other matters, (i) proper financial reporting, (ii) human resources strategy in response to digitalization and business expansion overseas and (iii) strengthening the function of internal control within the Three Core Companies.

Brief personal record

 

January 1970		Joined Tohmatsu Awoki & Co.
June 1985		Temporarily transferred to Deloitte & Touche New York Office (until October 1992)
July 1990		Senior Partner of Tohmatsu & Co.
June 2001		CEO (until May 2007)
June 2004		Executive Member of Deloitte Touche Tohmatsu Limited (until May 2007)
June 2007		Senior Adviser of Deloitte Touche Tohmatsu (until December 2009)
January 2010		Established the Certified Public Accountant Hirotake Abe Office (current)
June 2010		Outside Corporate Auditor of Conexio Corporation (until June 2018)
September 2010		Visiting Professor, Chuo Graduate School of International Accounting (until March 2012)
June 2011		Outside Corporate Auditor of Honda Motor Co., Ltd. (until June 2015)
October 2012		Outside Audit and Supervisory Board Member of Nippon Steel & Sumitomo Metal Corporation (until June 2016)
June 2015		Member of the Board of Directors (Outside Director) of Mizuho Financial Group (current)

Status of major concurrent offices

Certified Public Accountant Hirotake Abe Office

 

48

Candidate No. 12		Masami Yamamoto		New appointment / Independent Outside Director
Date of birth		January 11, 1954 (Age 65)
Current title and assignment at Mizuho Financial Group		—
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 0 shares Potential number of additional shares of common stock to be held: 0 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		—
Term in office as a director		— (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Corporate management Technology

Reason for selection as a candidate for director:

He served as Representative Director, President of Fujitsu Limited and he is currently active as Representative Director, Chairman of this company. He is also in charge of important posts such as a member of the Council for Promotion of Regulatory Reform. We selected him as a candidate for outside director based on our conclusion that he will be able to significantly contribute to, among other matters, strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, from a perspective independent from that of the management, leveraging his extensive experience as a senior executive of a global corporation and deep insight and expertise in the field of technology.

Candidate’s independence

He satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

The business relationship between Fujitsu Limited, where he serves as Director, Chairman, and the group does not affect his independence, for reasons including that (i) the percentage of sales gained through the business with the group of the consolidated net sales of Fujitsu Limited, and (ii) the percentage of gross profits gained through the business with group companies of Fujitsu Limited of the consolidated gross profits of Mizuho Financial Group, are less than 1%, respectively.

Brief personal record

 

June 2004		Executive Vice President, Personal Systems Business Group of Fujitsu Limited
June 2005		Corporate Vice President
June 2007		Corporate Senior Vice President
January 2010		Corporate Senior Executive Vice President
April 2010		President
June 2010		Representative Director, President
June 2015		Representative Director, Chairman
June 2017		Director, Chairman (current) Outside Director of JFE Holdings, Inc. (current)
Status of major concurrent office   Director, Senior Advisor of Fujitsu Limited (Mr. Yamamoto is expected to assume this position in late June, 2019) Outside Director of JFE Holdings, Inc.

 

49

Candidate No. 13		Hiroko Ota		Reappointment / Independent Outside Director
Date of birth		February 2, 1954 (Age 65)
Current title and assignment at Mizuho Financial Group		Member of the Board of Directors Chairman of the Board of Directors Member of the Nominating Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 5,000 shares Potential number of additional shares of common stock to be held: 11,200 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%) The Nominating Committee: 8/8 meetings (100%)
Term in office as a director		5 years (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Economic policy

Reason for selection as a candidate for director:

She has served in positions such as Professor at the National Graduate Institute for Policy Studies and Minister of State for Economic and Fiscal Policy of the Cabinet Office. She currently teaches at the National Graduate Institute for Policy Studies and is in charge of important posts such as the Chairman of the Regulatory Reform Promotion Council of the Cabinet Office and a member of the Government Tax Commission. We propose to appoint her as an outside director based on our conclusion that she will be able to significantly contribute to, among other matters, strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, from a perspective independent from that of the management, leveraging her extensive experience, deep insight and high level of expertise, which includes the ability to see things from a macro perspective (e.g., from a public policy and economic policy perspective) and a high level of awareness of the problems that must be resolved for the revival of the Japanese economy.

Although she has not previously been engaged in management of a company other than in her career as an outside director, we believe she will fulfill the duties of an outside director of Mizuho Financial Group due to the reasons stated above.

Candidate’s independence

She satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

Activities on the Board of Directors and committees

By leveraging her extensive experience, deep insight and high level of expertise as a university professor and as Minister of State of the Cabinet Office and other positions, she proactively made suggestions concerning, among other matters, (i) how the new business plan should be established taking into account being conscious of accountability to stakeholders, (ii) enhancing personnel management for the improvement of productivity and (iii) initiatives focusing on strengthening the capabilities of our workforce

Brief personal record

 

April 1996		Associate Professor, the Graduate School of Policy Science, Saitama University
October 1997		Associate Professor, National Graduate Institute for Policy Studies
April 2001		Professor, National Graduate Institute for Policy Studies
April 2002		Director for Economic Research, Cabinet Office
March 2003		Deputy Director General for Economic Research, Cabinet Office
April 2004		Director General for Economic Research, Cabinet Office
August 2005		Professor, National Graduate Institute for Policy Studies
September 2006		Minister of State for Economic and Fiscal Policy
August 2008		Professor, National Graduate Institute for Policy Studies (current)
April 2009		Vice-President, National Graduate Institute for Policy Studies (until March 2011)
June 2014		Member of the Board of Directors (Outside Director) of Mizuho Financial Group (current)

Status of major concurrent offices

Professor of National Graduate Institute for Policy Studies

Outside Director of JXTG Holdings, Inc.

Outside Director of Panasonic Corporation

 

50

Candidate No. 14		Izumi Kobayashi		Reappointment / Independent Outside Director
Date of birth		January 18, 1959 (Age 60)
Current title and assignment at Mizuho Financial Group		Member of the Board of Directors Member of the Nominating Committee Member of the Risk Committee
Number of Mizuho Financial Group shares held1		Number of shares of Mizuho Financial Group’s common stock currently held: 11,000 shares Potential number of additional shares of common stock to be held: 11,200 shares
Attendance at meetings of the Board of Directors and committees (Fiscal year 2018)		The Board of Directors: 14/14 meetings (100%) The Nominating Committee: 8/8 meetings (100%) The Risk Committee: 6/6 meetings (100%)
Term in office as a director		2 years (as of the closing of this ordinary general meeting of shareholders)
Area of expertise expected to have		Corporate management Finance

Reason for selection as a candidate for director:

She has served as President and Representative Director of Merrill Lynch Japan Securities Co., Ltd., and Executive Vice President of the Multilateral Investment Guarantee Agency of the World Bank Group. We propose to appoint her as an outside director based on our conclusion that she will be able to significantly contribute to, among other matters, strengthening the effectiveness of both the decision-making and supervisory functions of the Board of Directors, from a perspective independent from that of the management, leveraging her extensive experience and deep insight that she has cultivated in Japan and overseas.

Candidate’s independence

She satisfies the Independence Standards of Outside Directors of Mizuho Financial Group established by Mizuho Financial Group.

Activities on the Board of Directors and committees

By leveraging her extensive experience and deep insight as a senior executive, she proactively made suggestions concerning, among other matters, (i) risk management structures that can respond to changes in the environment immediately, (ii) how performance evaluations in Trading & Others should be structured and (iii) the reach of new solutions responding to the changing needs of customers.

Brief personal record

 

April 1981		Joined Mitsubishi Chemical Industries, Ltd. (currently Mitsubishi Chemical Corporation)
June 1985		Joined Merrill Lynch Futures Japan Inc.
December 2001		President and Representative Director, Merrill Lynch Japan Securities Co., Ltd. (until November 2008)
July 2002		Outside Director, Osaka Securities Exchange Co., Ltd.
November 2008		Executive Vice President, the Multilateral Investment Guarantee Agency, the World Bank Group
July 2013		Outside Director, ANA Holdings Inc. (current)
November 2013		Outside Director, Suntory Holdings Limited (until March 2017)
June 2014		Outside Director, Mitsui & Co., Ltd. (current)
July 2014		Member of the Risk Committee of Mizuho Financial Group (as an outside expert who is not a director) (until June 2017)
April 2015		Vice Chairperson, Japan Association of Corporate Executives (until April 2019)
June 2016		Member of the Board of Governors, Japan Broadcasting Corporation (current)
June 2017		Member of the Board of Directors (Outside Director) of Mizuho Financial Group (current)

Status of major concurrent offices

Outside Director of ANA Holdings Inc.

Outside Director of Mitsui & Co., Ltd.

Member of the Board of Governors of Japan Broadcasting Corporation

 

51

(Notes)		1.		For reference, “potential number of additional shares of common stock” refers to the number of shares that are scheduled to be delivered equivalent to the stock ownership points granted by the current stock compensation system and the stock acquisition rights granted by the former stock option system.
		2.		With respect to Mr. Tatsufumi Sakai, his attendance at the meetings of the Board of Directors is for those meetings that were held during the fiscal year 2018 after his appointment as a director of Mizuho Financial Group in June 2018.
		3.		The former Mizuho Bank, Ltd. and the former Mizuho Corporate Bank, Ltd. conducted a merger on July 1, 2013, whereby the former Mizuho Corporate Bank, Ltd. was the surviving company in an absorption-type merger, and the former Mizuho Corporate Bank, Ltd. changed its trade name to Mizuho Bank, Ltd.
		4.		Messrs. Yasuhiro Sato, Hisaaki Hirama and Masahiro Kosugi are the candidates for non-executive director who do not concurrently serve as executive officers, specialist officers, employees or executive directors of Mizuho Financial Group or its subsidiaries.
		5.		Messrs. Tetsuo Seki, Tatsuo Kainaka, Hirotake Abe, Masami Yamamoto and Mses. Hiroko Ota and Izumi Kobayashi satisfy the Independence Standards of Outside Directors of Mizuho Financial Group. Except for Mr. Yamamoto, they are the “independent directors”, as defined by the Tokyo Stock Exchange, Inc., for the current period. We plan to register Mr. Masami Yamamoto as an independent director with the Tokyo Stock Exchange.
		6.		Liability Limitation Agreement with outside directors
				Pursuant to the provisions of Article 427, Paragraph 1 of the Companies Act, we have entered into liability limitation agreements with five (5) candidates for outside director—namely Messrs. Tetsuo Seki, Tatsuo Kainaka and Hirotake Abe and Mses. Hiroko Ota and Izumi Kobayashi—which limit the liability provided for in Article 423, Paragraph 1 of the Companies Act to the greater of either (i) JPY 20 million or (ii) the amount prescribed by laws and regulations, provided that such outside director acts bona fide and without gross negligence in performing his or her duty. We intend to continue with similar liability limitation agreements with each candidate for outside director, i.e., the above five (5) candidates and enter into a similar agreement with Mr. Masami Yamamoto, upon their appointment at this ordinary general meeting of shareholders.
		7.		If this proposal is adopted, we expect the designation of the Chairman of the Board of Directors, and designation of committee members and the Chairman of each committee to be as follows:
				Chairman of the Board of Directors: Hiroko Ota Nominating Committee members: Tatsuo Kainaka (Chairman), Tetsuo Seki, Masami Yamamoto, Hiroko Ota and Izumi Kobayashi Compensation Committee members: Masami Yamamoto (Chairman), Tetsuo Seki, Tatsuo Kainaka and Hirotake Abe Audit Committee members: Tetsuo Seki (Chairman), Tatsuo Kainaka, Hirotake Abe, Hisaaki Hirama and Masahiro Kosugi Risk Committee members: Hisaaki Hirama (Chairman), Izumi Kobayashi and Hidetaka Kawakita (Outside Expert)
		8.		The age of directors indicates their age on their last birthdays as of this ordinary general meeting of shareholders.

 

52

		9.		Mr. Hirotake Abe served (and retired in June 2018) as an Outside Corporate Auditor of Conexio Corporation. This company received a correction order from the Ministry of Internal Affairs and Communications under the Act for the Prevention of Illegal Mobile Phone Use in May 27, 2016 and November 7, 2017. Mr. Abe was not involved in this matter; he routinely promoted awareness of compliance on such occasions as meetings of the board of directors. After this incident came to light, he had been carrying out his responsibilities as an outside corporate auditor by, among other acts, advising this company to strengthen their compliance system.
		10.		Mr. Masami Yamamoto serves as a Director, Chairman of Fujitsu Limited. In July 2016, when Mr. Yamamoto served as a Director of this company, it received the cease and desist orders and surcharge payment orders from the Japan Fair Trade Commission (JFTC) after the JFTC found that there was an illegal violation of the Antimonopoly Act regarding to the trade of equipment for electric power security communication ordered by Tokyo Electric Power Company Holdings Inc. Moreover, in February 2017, the JFTC found that there was an illegal violation of the Antimonopoly Act regarding the trade of apparatus for hybrid optical communication and transmission path ordered by Chubu Electric Power Company Holdings Inc. With respect to this case, Fujitsu Limited is not subject to the cease and desist orders since it requested a leniency application which was accepted by the JFTC. Mr. Yamamoto was not involved in this matter; he routinely promotes awareness of compliance on such occasions as meetings of the board of directors. After this incident came to light, he has carried out his responsibilities as a Director, Chairman by, among other acts, further strengthening measures on compliance and ensuring the implementation of efforts toward prevention of recurrence.
		11.		In May 2018, Panasonic Corporation (“Panasonic”), for which Ms. Hiroko Ota serves as an outside director, and its U.S. subsidiary, Panasonic Avionics Corporation (“Panasonic Avionics”), as one party, and the United States Securities and Exchange Commission (SEC) and the United States Department of Justice (DOJ), as the other party, agreed that Panasonic and Panasonic Avionics would pay US$ 280,602,830.93 to the U.S. government and undertake various efforts to improve compliance with respect to the SEC’s and DOJ’s investigation on the suspected violation of the Foreign Corrupt Practices Act and other securities laws in respect of Panasonic Avionics’ execution of certain contracts with airline customers and use of sales agents and consultants pertaining to such contracts. Ms. Ota is not involved in this matter; she routinely promotes awareness of compliance on such occasions as meetings of the board of directors. After this incident came to light, she has been carrying out her responsibilities as an outside director by, among other acts, directing a thorough investigation of the facts and prevention of recurrence and confirming the details of the efforts toward prevention of recurrence.

 

53

Overview of Independence Standards of Outside Directors of Mizuho Financial Group

 

1.

An outside director shall not be an executive director, an executive officer, a specialist officer, or an employee (“a Person Performing an Executive Role”) of Mizuho Financial Group or its current subsidiaries nor have been a Person Performing an Executive Role in the past 10 years prior to his or her appointment, nor shall be a director, an audit & supervisory board member, an audit counselor, an executive officer, a specialist officer, or an employee of a company for which Mizuho Financial Group is a principal shareholder.

 

2.	(1) An outside director shall not be a person with whom, or Person Performing an Executive Role at a parent company or material subsidiary to whom, Mizuho Financial Group or the Three Core Companies have been principal business counterparties within the past three years.

(2) An outside director shall not be a person with whom, or Person Performing an Executive Role at a parent company or material subsidiary to whom, Mizuho Financial Group or the Three Core Companies have been principal business counterparties within the past three years.

 

3.

An outside director shall not be a Person Performing an Executive Role of an entity that receives donations or other support, the total amount of which exceeds a specific amount (greater amount of either the three-year average of JPY 10 million per year or 30% of the average annual total expenses) from Mizuho Financial Group or the Three Core Companies.

 

4.	An outside director shall not be a Person Performing an Executive Role of a company or its parent company or subsidiaries to which directors are transferred from Mizuho Financial Group or its subsidiaries.

 

5.

An outside director shall not currently be an accounting auditor or a person employed by an accounting auditor of Mizuho Financial Group or its subsidiaries nor has been in charge of the audit of Mizuho Financial Group or its current subsidiaries in such a capacity within the most recent three years.

 

6.

An outside director that is a lawyer, consultant, or other type of specialist shall not receive greater than or equal to JPY 10 million per year on a three-year average from Mizuho Financial Group or the Three Core Companies other than compensation for officers nor shall they be employed by an advisory firm such as a law firm, to whom Mizuho Financial Group or the Three Core Companies are principal business counterparties.

 

7.

An outside director shall not be a close relative of the directors, executive officers, specialist officers, or “Sanyo” (the highest rank for a non-executive employee), Advisors, Executive Advisors or others that have a rank similar to an officer (“Person Equivalent to an Officer”; the same applies hereinafter) of Mizuho Financial Group or its current subsidiaries nor close relatives of such directors, executive officers, specialist officers, or Person Equivalent to an Officer, within the past five years nor a close relative of individuals who satisfy similar standards set forth in the latter part of 1 and in 2, 3, 5 and 6 above (excluding non-material cases).

 

8.	An outside director shall not be a person who is likely to give rise to consistent substantive conflicts of interest in relation to general shareholders other than for the reasons considered above.

 

9.

Even in the event that a person does not satisfy items 2 through 7 set forth above, Mizuho Financial Group may appoint as its outside director a person who we believe to be suitable for the position of an outside director with sufficient independence in consideration of such person’s character and insight, provided that we externally provide an explanation as to why we believe such person qualifies as an outside director with sufficient independence.

Note:

 

“Three Core Companies” refers to Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd., and Mizuho Securities Co., Ltd.

 

“Principal business counterparties” are determined based on a standard of greater than or equal to 2% of the consolidated annual total sales (consolidated annual gross profits for Mizuho Financial Group) of each of the three fiscal years including the most recent fiscal year.

 

54

Shareholders’ proposal (Proposal 2) Pages 56 through 57

The proposal has been made by a certain shareholder.

 

∎

Proposal 2 has been made by one (1) shareholder. (The voting interest of such shareholder is 0.0001%.)

 

∎

We have reproduced the details of and reasons for the proposal as it originally appeared, without making any changes to the factual understanding of the proposer or correcting omissions and errors.

 

∎

What is a shareholder proposal?

Under the Companies Act, a Shareholder’s Right to Propose is recognized on condition that certain requirements are satisfied. When these proposals are made, we are required to insert the proposals in this convocation notice regardless of their content, except for the case where there is any breach of laws and regulations or the Articles of Incorporation.

As a result of considering matters based on the above, this fiscal year, we inserted in this convocation notice the proposal received from a certain shareholder. The Board of Directors opposes such proposal.

Please exercise your voting rights after confirming the opinion of the Board of Directors of Mizuho Financial Group on the following pages.

 

Proposal				Opinion of the Board of Directors		Page
Proposal 2		Partial amendment to the Articles of Incorporation (renouncement of the qualification of JGB Market Special Participant)		Oppose			p.56

 

55

Proposal 2: Partial amendment to the Articles of Incorporation (renouncement of the qualification of JGB Market Special Participant)

 

1.	Details of proposal

It is proposed that the following provision be added to the Articles of Incorporation:

Mizuho Financial Group shall renounce the qualification of JGB Market Special Participant.

 

2.	Reasons for proposal

Due to the Bank of Japan’s erroneous “negative interest rate policy,” the interest rate on Japanese government bonds has become almost zero, and, in some cases, it has become negative. If Japan’s financial situation were likened to that of a company, it would be considered almost bankrupt. There is no assurance that said government bonds will not default. I would like Mizuho Financial Group to cease participation in such a scheme that forces participants to buy a certain amount of high-risk government bonds. As a matter that I have brought attention to through my submission of shareholders’ proposals for many years and interviews with officers several times, I would also like to point out that all companies in the Mizuho Financial Group lack awareness of the cost burden on customers and awareness of cost and risk management. I believe the reason MUFG Bank was the first to renounce the qualification to participate in is that it has strong awareness of risk and cost management.

(Company’s note) The details and reasons for the proposal are as stated in the original text.

 

•

Opinion of the Board of Directors of Mizuho Financial Group

Oppose: The Board of Directors of Mizuho Financial Group opposes this proposal.

In accordance with the risk appetite framework, we are appropriately managing risks based on scenarios formulated by taking into account the external environment and potential risk events, and ensuring risk governance through implementation of a risk management system and monitoring system.

We are investing in Japanese government bonds in consideration of the entire portfolio, including stock portfolio and bond portfolio, while paying attention to the cost for holding Japanese government bonds under the negative interest rate policy in addition to economic and financial market trends that affect Japanese government bonds prices. We believe such investments are appropriate from the perspectives of cost and risk management.

Among the companies in the Mizuho Financial Group, Mizuho Bank, Ltd. and Mizuho Securities Co., Ltd. are qualified as JGB Market Special Participants. We believe that maintenance of such a qualification is meaningful from the perspective of not only the portfolio management of a bank, but also the sound development of the customer business and the Japanese government bond market.

 

56

Accordingly, the Board of Directors is of the opinion that whether to maintain such a qualification or not should be decided comprehensively in the context of business management, and that it is unnecessary to add the proposed provision to the Articles of Incorporation.

 

57

(Materials Attached to the Notice of Convocation of the Ordinary General Meeting of Shareholders)

Business Report for the 17th Fiscal Year

(from April 1, 2018 to March 31, 2019)

1. The current state of Mizuho Financial Group, Inc.

(1) Developments and results of operations

Group business domains

Mizuho Financial Group (“the group”) is composed of the holding company, Mizuho Financial Group, Inc. (“Mizuho Financial Group”), 117 consolidated subsidiaries and 22 affiliates under the equity method. Our vision is to become the most trusted financial services group with a global presence and a broad customer base, contributing to the prosperity of the world, Asia and Japan, and our business domain includes banking, trust banking, securities and other financial services.

 

 

The chart above briefly illustrates the relationship between Mizuho Financial Group and the core group companies.

 

58

Financial and economic environment (for the fiscal year ended March 31, 2019)

Reviewing the economic environment over the fiscal year ended March 31, 2019, the overall global economy continued on a path of gradual recovery driven by the steady expansion of U.S. economy. On the other hand, the Chinese and European economies showed a clear slowdown due to factors such as uncertainty related to the trade disputes between the United States and China.

In the United States, the economy continued its steady expansion as a result of tax cuts and fiscal expenditure. However, there was a downturn in business confidence in the manufacturing industry due primarily to the impact of the trade disputes with countries such as China. The unemployment rate remained low, and wage growth accelerated somewhat, and spillover effects on prices have yet to be observed. The Federal Reserve Board (FRB) also changed its stance regarding interest rates, from one with an inclination towards rate increases to a more wait-and-see stance, and announced their planned suspension of the shrinking of their balance sheet.

In Europe, the economy remained weak. Business confidence showed a clear downturn within mainly the manufacturing sector. The European Central Bank (ECB) suspended purchases of new assets but left its policy rate unchanged amid growing uncertainties such as Brexit*.

In Asia, the Chinese economy remained stagnant. In China, export growth slowed rapidly mainly due to the impact of trade disputes between the United States and China. Although the economies of emerging countries were continuing to recover, the risk of capital outflows remained in some countries with current account deficits due to concerns over U.S. trade policy and the Chinese economy.

In Japan, the economy continued to trend towards recovery but exports declined due to weak overseas economies and production was lacking strength. Consumer spending continued to remain on a moderate trend of recovery amid favorable employment conditions. The Bank of Japan continued its Quantitative and Qualitative Monetary Easing with Yield Curve Control measures with a view to achieving a price stability target of two percent but indicated that it will be difficult to achieve this target by the end of the 2020 fiscal year.

 

59

As to the prospects for the global economy, recovery is expected to continue to be centered on the United States, but close attention should be paid to growing uncertainties such as U.S. trade policy, the political concerns in Europe, the economic and market outlook for China and emerging countries and geopolitical risks in the Middle East.

 

*	The United Kingdom’s withdrawal from the European Union.

 

60

Developments and results of operations

Results of operations for fiscal year 2018

Profit Attributable to Owners of Parent for fiscal year 2018 amounted to JPY 96.5 billion, achieving 16% against our target of JPY 570.0 billion, which was determined at the beginning of the fiscal year.

During fiscal year 2018, both domestic and overseas profit from customer divisions increased due to an increase in income from settlement and foreign exchange business, solutions business-related income and other income; however, profits from the markets division decreased due primarily to our efforts to ensure the soundness of our bond portfolio, including non-Japanese bonds. Therefore, Consolidated Net Business Profits + Net gains or losses related to ETFs and others¹ for fiscal year 2018 decreased by JPY 129.6 billion on a year-on-year basis to JPY 408.3 billion. On the other hand, Profit Attributable to Owners of Parent for the fiscal year decreased by JPY 479.9 billion on a year-on-year basis regardless of factors such as profit from cross-shareholdings disposal, because major extraordinary factors of Credit-related Costs in the previous fiscal year were deducted, and Losses on Impairment of Fixed Assets attributable to the Japanese retail business were recorded as Extraordinary Losses. As a result, our consolidated Common Equity Tier 1 capital ratio as of March 31, 2019 was 10.71%, ensuring a sufficient level. In fiscal year 2018, we recorded JPY 695.4 billion as losses in light of structural reform. Excluding the impact of such losses, Profit Attributable to Owners of Parent amounted to JPY 581.8 billion, achieving our target for the fiscal year.

Mizuho Financial Group has been implementing disciplined capital management by pursuing the optimum balance between strengthening of stable capital base and steady returns to shareholders. As for our policy to return profits to shareholders for fiscal year 2018, Mizuho Financial Group has implemented a steady dividend payout policy setting a dividend payout ratio on a consolidated basis of approximately 30% as a guide for our consideration.

Based on this policy, Mizuho Financial Group has decided to make year-end cash dividend payments of JPY 3.75 per share of common stock for fiscal year 2018 (resulting in annual cash dividends including interim dividends totaling JPY 7.50 per share for fiscal year 2018, which is the same amount as that for the previous fiscal year), as forecast in the dividends estimates for fiscal year 2018. The Board of Directors of Mizuho Financial Group has considered thoroughly and decided to make the above stated cash dividend payments, although Profit Attributable to Owners of Parent declined significantly in fiscal year 2018 as a result of recording losses in light of structural reform. To make such decision, the Board of Directors of Mizuho Financial Group has considered that our consolidated Common Equity Tier 1 capital ratio (Basel III fully-effective basis (based on current regulations), excluding Net Unrealized Gains on Other Securities), which is the foundation of fulfilling stable financial functions, exceeded the target of the medium-term business plan formulated for the three years starting from fiscal year 2016, i.e. 10% as of March 31, 2019, and that Mizuho Financial Group aims to implement a steady dividend payout policy, and has taken into account our business environment comprehensively such as future earnings forecasts, profit base, status of capital adequacy, and domestic and international regulatory trends such as the Basel framework.

 

61

Notes:

 

1.	Aggregate of Net gains or losses related to ETFs and others in the banking and trust banking business and Net gains or losses related to operating investment securities (Mizuho Securities consolidated)

 

Profit Attributable to Owners of Parent		Consolidated Net Business Profits + Net gains or losses related to ETFs and others		Consolidated Common Equity Tier 1 capital ratio		Cash Dividend Payments on Common Stock (annual cash dividends)
JPY 96.5 billion		JPY 408.3 billion		10.71%		JPY 7.50
479.9 billion decrease on a year-on-year basis		129.6 billion decrease on a year-on-year basis		0.56% increase on a year-on-year basis		Year-end cash dividends for fiscal year 2018: JPY 3.75 per share

 

62

Results of operations (non-consolidated) for our major subsidiaries were as follows:

 

		(JPY billion)
Company name		Ordinary Income (Operating Income)				Ordinary Profits				Net Income2
Consolidated results of Mizuho Financial Group			3,925.6				614.1				96.5
Mizuho Bank, Ltd.			2,616.9				284.5				-144.4
Mizuho Trust & Banking Co., Ltd.			209.5				55.3				39.0
Mizuho Securities Co., Ltd.			341.1				35.9				12.3

 

2.	The “Net Income” figure of “Consolidated results of Mizuho Financial Group” refers to Profit Attributable to Owners of Parent.

 

63

Initiatives in FY2018

We promoted our medium-term business plan, entitled Progressive Development of “One Mizuho”—The Path to a Financial Services Consulting Group, for the three years from fiscal year 2016. In order to address three material issues in fiscal year 2018, the final year of the plan, specifically (1) commencement and implementation of fundamental structural reforms, (2) accomplishment of the medium-term business plan and (3) the migration to our next-generation IT system, our group-wide management policy was to progressively develop the One Mizuho strategy by implementing changes to the structure and foundations of our business, further integrating the “customer first” principle into everything we do, and fundamentally increasing productivity.

First, with respect to the commencement and implementation of fundamental structural reforms, in order to strengthen our earning power, we undertook various efforts, including expanding the scope of risk-taking, focusing on areas with growth potential and accelerating the credit review process through a revision of our credit assessment framework. In addition, we endeavored to streamline the number of personnel to align with our business strategy, shift some Head Office personnel to the frontlines and restructure our customer channels by combining branches with respect to banking, trust banking and securities.

Secondly, with respect to the accomplishment of the medium-term business plan, we steadily carried out our initiatives, including strengthening our model for non-interest income business on a global basis and disposing of cross-shareholdings. With respect to financial targets, we achieved the target levels we had set regarding our consolidated Common Equity Tier 1 capital (CET1) ratio and disposing of cross-shareholdings (based on the amount consented to); however, we failed to achieve our targets regarding our Consolidated ROE, RORA (based on Profit Attributable to Owners of Parent) and group expense ratio, partly due to the recording of losses in light of structural reforms, as described below, and other influences.

Thirdly, we worked on the migration to our next-generation IT system as one of our top management priorities and have successfully completed all of the eight migration steps that were scheduled to be implemented in fiscal year 2018.

In addition to the above-mentioned initiatives, we have proceeded with initiatives such as creation of new business opportunities and expansion of solution domains through the use of digital technology and open collaboration with third parties, including those in other industries.

 

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Fourthly, in an effort to contribute to the sustainable development of society and to create new corporate value, we have addressed environmental, social and governance (ESG) issues. With respect to the environment and society, we established Policies on Specific Industrial Sectors, which set forth our policies in response to clients in certain industries where there is a high possibility that our involvement with the client would contribute to an adverse impact on the group. With respect to governance, we revised our executive compensation system¹, raised the proportion of Stock Compensation for executives responsible for business execution and implemented other related measures.

Finally, with respect to legal compliance, we continued working on a variety of efforts, such as preventing transactions with individuals or organizations associated with organized crime and taking countermeasures against money laundering and terrorism financing, including our response to FATF’s² Fourth Mutual Evaluation of Japan.

Recording of losses in light of structural reforms

In our financial results for the fiscal year ended March 31, 2019, we bundled together and recorded losses totaling approximately JPY 695.4 billion at one time in order to carry out our structural reforms ahead of schedule and immediately eliminate the burdens that we would have incurred in the following fiscal years. Based on our view that the business environment will continue to be challenging for the foreseeable future, we aim to implement feasible measures at an early stage, accelerate the elimination of structural issues, reduce earnings volatility and further solidify our stable profit base, and such recording of losses will contribute to our future management direction.

 

1	Directors, executive officers as defined in the Companies Act, executive officers as defined in our internal regulations, and specialist officers of Mizuho Financial Group, Mizuho Bank, Ltd., Mizuho Trust & Banking Co., Ltd. and Mizuho Securities Co., Ltd.

 

2	FATF stands for the Financial Action Task Force, which is an inter-governmental body to promote international cooperation in countermeasures against money laundering and terrorism financing.

 

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Issues to be addressed by the group

Our customers’ needs and the financial industry are rapidly undergoing structural changes in reflection of the structural shifts occurring in the economy, industry and society such as digitalization, an aging society with low birthrate and globalization. It is essential that we respond quickly to these structural changes, especially in light of increasing uncertainty in the business environment due to concerns regarding a global economic slowdown, signs of a turn in the credit cycle* and other factors.

In consideration of this environment and the issues, we launched the 5-Year Business Plan: Transitioning to the Next Generation of Financial Services spanning a five-year period starting from fiscal year 2019.

Our new business plan is focused on transitioning to the next generation of financial services—building new forms of partnerships with our customers so that we can respond to their needs as the times change. Our objective is to build a stronger and more resilient financial group which our customers can depend on in the coming era.

 

*	The cycle of expansion and contraction of credit that occurs during certain periods in financial markets.

 

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5-Year Business Plan: Transitioning to the Next Generation of Financial Services

 

Outline of the new business plan

Basic policy

By implementing forward-looking structural reforms focused on three interconnected areas: business structure, finance structure and corporate foundations, we will resolve the mismatch that has arisen in the allocation of corporate resources such as branches and human resources and respond to new customer needs in order to transition to the next generation of financial services.

The 5 year period of the business plan can be broadly divided into two phases; Phase 1 (3 years from fiscal year 2019) in which full implementation of the structural reforms, building the firm foundations for the next generation financial services will be conducted and phase 2 (2 years from fiscal year 2022) which will aim to achieve the effects of the structural reforms and accelerate further growth.

Key strategy

In order to transition to the next generation of financial services, we will create new value incorporating both financial and non-financial products and services by going beyond the conventional boundaries of finance in order to forge new forms of partnerships with our customers.

Building new forms of partnerships with our customers

 

 

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For such purpose, we will draw on the strengths that we have cultivated thus far and accelerate our digitalization initiatives and proactive collaboration with external partners.

 

We will adopt “Open & Connected” and “Passionate & Professional” as our action principles.

 

 

*	The chain of value added in each process before a product is delivered to customers.

Financial targets

As financial targets, we have set a target for Consolidated ROE as an indicator of our earnings power compared to capital, and a target for Consolidated Net Business Profits as an indicator of fundamental earnings power.

 

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Financial targets

 

Consolidated ROE1		Approx. 7 - 8% by fiscal year 2023
Consolidated Net Business Profits2		Approx. JPY 900 billion by fiscal year 2023

 

1:	Excluding Net Unrealized Gains on Other Securities.

 

2:	Consolidated Net Business Profits + Net gains or losses related to ETFs and others. (aggregate for Mizuho Bank and Mizuho Trust & Banking) + Net gains or losses related to operating investment securities (Mizuho Securities consolidated)

Other key indicators

 

Common Equity Tier 1 (CET1) capital ratio target level3		Lower end of the 9 -10% range
Reduction of cross-shareholdings4		Reduction of JPY 300 billion by the end of fiscal year 2021

 

3:	Basel III (finalized requirements) fully-effective basis. Excluding Net Unrealized Gains on Other Securities.

 

4:	Acquisition cost basis.

Policy to return profits to shareholders

 

Priority business domains

(1) Business structural reforms

We will implement business structural reforms focused on the following initiatives to better enable us to respond to structural shifts occurring in the economy, industry, and society while drawing on our strengths.

 

·	Be a partner that helps customers design their lives in a changing society

 

Assist customers with asset building to support their life design in an era of lengthening lifespans, and develop professionals capable of providing this assistance.

 

Provide sophisticated solutions for business succession needs and assist clients with needs regarding identifying candidates for senior management roles.

 

Create next-generation branches focused on consulting which combine physical locations and digital channels.

 

Appeal to new customer demographics and create new demand through the application of technology and open collaboration.

 

·	Be a strategic partner for business development under a changing industrial structure

 

Open collaboration for growth acceleration including financing the growth of startups and forming industry-government-academia partnerships.

 

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Utilize our industry knowledge and other insights to build new forms of partnerships, sharing business risks.

 

Leveraging our Asian client base and network in order to support the business development of global clients.

 

·	Be a partner with expert knowledge of market mechanisms and the ability to draw on a range of intermediary functions

 

By optimizing our global network and products framework, draw on a broad range of intermediary functions to connect investors with other investors and connect issuers with investors.

 

Enhance the sophistication of our ALM and portfolio management through flexible asset allocation while maintaining a focus on achieving a balance between realized gains and unrealized gains/losses.

(2) Finance structure reforms

We will implement finance structure reforms focused on the following initiatives to transition to a flexible business/earnings structure which can better respond to changes in the business environment and competitive environment.

 

·	We will identify business/earnings structure issues in each business domain, focusing on the following four perspectives:

 

(1)

Risk & return (Gross profits ROE), (2) Cost & return (expense ratio), (3) Growth potential, (4) Stability

 

·	Based on the above issues, streamline certain areas and concentrate/re-allocate corporate resources to growth areas.

 

·	After establishing a stable profit base, transition to an earnings structure centered on proactively pursuing earnings streams with upside potential.

(3) Corporate foundations reforms

We will implement the following initiatives in order to strengthen our corporate foundations as a means of supporting continued competitive advantage.

 

Transform our approach to new business and our working style.

 

–

Focus on the areas of personnel & workplace, IT systems/digital, channels and group companies.

 

–

Revise our HR management in line with an approach which prioritizes employees’ professional growth and career preferences and promote a new HR management strategy focused on maximizing our workforce value that is universally recognizable.

 

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Strengthen group governance.

 

–

Expand the use of “dual-hat” appointments of executive officers between the holding company and group companies and other methods of strengthening unified management of the group, including group companies other than banking, trust banking and securities entities. This will enhance our ability to implement key strategies and structural reforms.

 

Cultivate a new corporate culture centered on communication.

Sustainability initiatives

Through the initiatives under the new business plan, we will create new value for our stakeholders.

 

·	Customers: Create new value in business areas surrounding finance and achieve increased customer convenience and business growth.

 

·	Shareholders: Increase corporate value by resolving structural issues and accelerating growth.

 

·	Employees: Create workplaces that give employees a sense of purpose, linked to customer satisfaction.

With this in mind, we will define sustainability for the group as “achieving sustainable and stable growth for the group, and through this growth, contributing to the sustainable development and prosperity of the economy, industry and society around the world.” Further, we will select “key sustainability areas” which reflect the expectations and demands of our stakeholders, in light of a materiality to and affinity with our strategies, and the medium- to long-term impact on our corporate value. This will form the basis of our efforts to contribute to the realization of the UN’s Sustainable Development Goals (SDGs)*.

 

*	International goals from 2016 to 2030 that were set forth in the “2030 Agenda for Sustainable Development” adopted by the UN Summit held in September 2015.

Fiscal year 2019 management policy

For the first year of the new business plan, we will implement forward-looking structural reforms ahead of schedule. Unified as a group, we will accelerate the structural reforms and along with this, we will come together as a group to revise various business operations in order to build new forms of partnerships with our customers as a starting point for creating value in a wide range of areas.

Initiatives taken by each in-house company/unit

We have established five in-house companies, which determine and promote group-wide strategies across banking, trust banking, securities and other business areas according to customer segment, as well as two units that support all of the in-house companies.

 

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The following section contains a closer look at each in-house company/unit’s initiatives in FY 2018 (developments and results of operations) and policy for initiatives in the future (issues to be addressed).

 

 

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Retail & Business Banking Company

The Retail & Business Banking Company, as the in-house company in charge of customer segments of individual customers, SMEs and middle-market corporations, engages in consulting services that integrate banking, trust banking, securities and other functions within the Mizuho group, as well as providing convenient financial services by leveraging advanced technologies and forming alliances with other companies as well as other means.

Initiatives in FY2018

We have worked to better meet individual customers’ needs regarding the shift from savings to investments and asset building, and asset succession through sophistication of consulting services. We have also endeavored, among other things, to provide corporate clients with optimal solutions utilizing our group functions to guide them through major events such as M&As, IPOs and business succession.

In addition, we strengthened our efforts in new business areas, including the launch of a new affiliate, J.Score CO., LTD, the commencement of discussions into joint establishment of a new bank with LINE Corporation, and the launch of J-Coin Pay, a smartphone-based payment service, in cooperation with approximately 60 other financial institutions.

Policy for initiatives in the future

In light of structural changes in customer needs against the backdrop of further progress in digitalization, an aging society with a low birthrate and other factors, we will optimize sales channels including stores, and expand new business areas to realize the wants and desires of individual customers as well as the sustainable growth of corporate customers.

In order to achieve this goal, we will take advantage of our broad customer base, trustworthiness & dependability, and our consulting capabilities and other things. At the same time, we will collaborate openly with those both inside and outside the Company to provide new value incorporating both financial and non-financial products and services, as a partner for individual customers’ life design and corporate customers’ growth strategies and business succession.

 

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Corporate & Institutional Company

The Corporate & Institutional Company, as the in-house company in charge of customer segments of large corporations, financial institutions and public-sector entities in Japan, provides custom-designed solutions for each client on a group-wide basis to meet clients’ capital raising, asset management and business/financial strategy related needs.

Initiatives in FY2018

In light of clients’ increasing needs to accelerate international business strategies and respond to digital innovation, we strengthened our efforts to offer solutions from various perspectives, including strengthening collaboration through the transaction to make IBJ Leasing Company, Limited* our equity-method affiliate.

In addition, we have actively worked on strengthening global inter-sectoral collaboration in the securities business and on strengthening real estate related business and consulting functions in the trust banking business, as well as on public private partnerships/private finance initiatives (PPP/PFI) and other initiatives.

 

*	IBJ Leasing Company, Limited plans to change its trade name to “Mizuho Leasing” subject to approval at the ordinary general meeting of shareholders scheduled to be held in June 2019.

Policy for initiatives in the future

We will build new relationships with customers and realize value co-creation and co-prosperity based on changes in customer needs in response to changes in social and industrial structures.

In order to achieve this goal, as a strategic partner for customers’ business development, we will utilize our sophisticated industry knowledge and competency to create business opportunities for our customers and to demonstrate our ability to draw on a broad range of intermediary functions in the sharing of business risk, in an open manner.

Global Corporate Company

The Global Corporate Company, as the in-house company in charge of customer segments, including both Japanese companies operating outside Japan and non-Japanese companies, provides various solutions by taking advantage of our deep understanding of our clients’ businesses and our strengths in corporate finance and transaction banking, such as lending and corporate bond underwriting.

 

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Initiatives in FY2018

We strengthened our support for Japanese companies looking to expand internationally, providing optimal solutions through tailor-made consulting services ranging from providing information for clients at the time of entering into overseas markets to advising on business and financial strategies.

For non-Japanese corporate clients, we continued the Global 300 Strategy, which involves focusing on approximately 300 blue-chip company groups around the world, and endeavored to build long-term relationships with clients through our approach which focuses on industry sectors utilizing our group’s in-depth understanding and record of accomplishments as well as our group’s close relationships with the management of companies.

Policy for initiatives in the future

We will optimize our business portfolio in anticipation of future growth constraints, such as future regulatory changes and our foreign currency funding capabilities. At the same time, we will collaborate with customers in their development of global business to leverage the cross-regional business value chains.

In order to achieve this goal, as a strategic partner that supports business development globally, we will link customers and functions with other customers and functions in each region based in Asia excluding Japan, while utilizing our network in the rapidly growing Asian economies and our presence in the highly productive U.S. capital market.

Global Markets Company

The Global Markets Company, as the in-house company in charge of market related business, engages in sales and trading services to a wide range of customers, from individuals to institutional investors, by offering market products to meet their risk hedging and asset management needs, and equity, fixed income and other investment business, based on a wide range of products through collaboration between the group’s banking, trust banking and securities functions.

Initiatives in FY2018

In order to further enhance our capacity to provide services to customers, the Global Markets Company, endeavored to enhance sales and trading services by optimizing transactions utilizing artificial intelligence (AI), as well as drawing on our group-wide capabilities to provide solutions.

 

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Moreover, in our investment business, we worked to manage our portfolios by enhancing the sophistication of our early warning systems for detecting fluctuations in the markets and by diversifying investments, however, amid growing uncertainty in the financial market we started measures such as restructuring of the securities portfolio of foreign bonds and other securities that we had invested in in the past, in order to achieve a more stable profit structure.

Policy for initiatives in the future

We will realize a stable earnings structure in the investment business and operation of well-balanced sales and trading services, which enable us to draw on diverse intermediary functions through the market and create diverse value for our customers.

In order to achieve this goal, as a partner with expert knowledge of market mechanisms that has insight into markets, we will optimize the asset allocation for investment and product lineup and establish a stable profit base. At the same time, we will provide optimal investment opportunities to investors with different risk preferences.

Asset Management Company

The Asset Management Company, as the in-house company in charge of business related to asset management, provides products and services that match the asset management needs of our wide range of customers, from individuals to institutional investors, through the collaboration between the group’s banking, trust banking, and securities functions and Asset Management One Co., Ltd.

Initiatives in FY2018

For individual customers, the Asset Management Company focused on providing services, such as investment trusts suitable for medium- to long-term asset building and individual-type defined contribution pension plans (iDeCo), in consideration of an era of lengthening lifespans. We also endeavored to develop products that meet customer needs, including the establishment of new capital-protected investment trusts.

 

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For clients such as pension funds, we focused on services such as (i) analysis of and advice on each portfolio from the perspective of both assets and liabilities, and (ii) consulting proposals from the perspective of both pension plans and investment.

Policy for initiatives in the future

We will work on transforming our structure to achieve the high capital efficiency that the investment management business essentially pursues, and, at the same time, support customers’ medium-to long-term asset formation, and thereby contribute to the revitalization of domestic financial assets.

In order to achieve this goal, we will strengthen our capacity for conducting asset management and providing solutions, increase the added value of our asset management functions, and respond to changing customer needs in a unified group manner. At the same time, we will pursue efficiency and progressiveness through innovation and business process reforms.

Global Products Unit

The Global Products Unit deals with creating a wide range of solutions, including M&A, real estate, project finance, domestic and foreign payments, asset management and stock transfer agency, as the unit in charge of providing solutions to a wide range of customer segments, including individual customers, corporate clients and investors, in the areas of investment banking and transaction banking.

Initiatives in FY2018

The Global Products Unit provided comprehensive services by exerting our strong group cooperation and high level of expertise regarding products and by assembling the group’s broad range of products and services to respond to a wide range of client needs for M&A, IPO, business succession and other events.

In addition, Trust & Custody Services Bank, Ltd. incorporated JTC Holdings, Ltd. by implementing a joint share transfer with Japan Trustee Services Bank, Ltd. for the purpose of realizing more stable and higher quality operations by seeking the benefit of scale.

Policy for initiatives in the future

As uncertainty grows in the operating environment that our customers and society confront today, we will be thoroughly aligned with our customers’ changing needs and will provide optimal solutions based on our high level of expertise and knowledge.

 

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In addition, we will support each in-house company’s pursuit of its strategies and contribute to increasing the group’s stable earnings power by optimizing the allocation of corporate resources for each product and by effectively creating value chains on a group-wide basis.

Research & Consulting Unit

The Research & Consulting Unit, as the unit in charge of providing research services and consulting services, offers a wide variety of solutions that combine (1) research functions that provide deep analysis, spanning from industrial to macroeconomic analysis, (2) consulting functions that cover many fields, including business strategy, and (3) IT and digital technology insights.

Initiatives in FY2018

The Research & Consulting Unit worked proactively to provide supports for contributing to our customers’ business transformation and to provide recommendations and other opinions for developing solutions regarding social issues, including an aging society with a low birthrate and environment and energy issues, as a key source of value creation by combining the research and consulting functions and IT and digital technology insights within the unit and by further strengthening collaboration with each in-house company.

Policy for initiatives in the future

In a rapidly changing economic and social environment, including an aging society with a low birthrate, digitalization and globalization, we will further contribute to creating new value for our customers and society by utilizing our expertise, including industry expertise that can better respond to structural shifts occurring in our customers’ needs, and by creating value chains on a group-wide basis.

In order to realize new value creation, we will work to increase sophistication of research functions, to enhance consulting business, to leverage IT and digital technology and to address other challenges.

 

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(2) Changes in financial conditions and results of operations (consolidated basis and non-consolidated basis)

a. Changes in financial conditions and results of operations (consolidated basis)

 

		(JPY billion)
		FY2015 (For the fiscal year  ended March 31, 2016)				FY2016 (For the fiscal year ended March 31, 2017)				FY2017 (For the fiscal year ended March 31, 2018)				FY2018 (For the fiscal year ended March 31, 2019)
Ordinary Income			3,215.2				3,292.9				3,561.1				3,925.6
Ordinary Profits			997.5				737.5				782.4				614.1
Profit Attributable to Owners of Parent			670.9				603.5				576.5				96.5
Comprehensive Income			304.5				558.1				765.5				(110.5	)
Total Net Assets			9,353.2				9,273.3				9,821.2				9,194.0
Total Assets			193,458.5				200,508.6				205,028.3				200,792.2

 

Note:

Fractions are rounded down.

b. Changes in financial conditions and results of operations (non-consolidated basis)

 

		(JPY billion)
		FY2015 (For the fiscal year ended March 31, 2016)				FY2016 (For the fiscal year ended March 31, 2017)				FY2017 (For the fiscal year ended March 31, 2018)				FY2018 (For the fiscal year ended March 31, 2019)
Operating Income			333.5				378.0				305.0				331.3
Cash Dividends Received			292.8				328.1				256.0				291.1
Cash Dividends Received from Majority-owned Banking Subsidiaries			272.0				300.5				227.0				267.7
Cash Dividends Received from Other Subsidiaries and Affiliates			20.8				27.6				28.9				23.3
Net Income			(JPY million 304,389	)			(JPY million 326,676	)			(JPY million 257,192	)			(JPY million 354,576	)
Net Income per Share of Common Stock			(JPY 12.17	)			(JPY 12.91	)			(JPY 10.13	)			(JPY 13.97	)
Total Assets			7,064.2				9,269.3				10,584.8				11,637.1
Investments in Majority-owned Banking Subsidiaries			5,454.8				5,454.4				5,454.4				5,454.4
Investments in Other Subsidiaries and Affiliates			567.7				620.1				620.1				620.1

 

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Notes:

1. Fractions are rounded down.

2. Net Income per Share of Common Stock was computed based upon the following formula:

 

Net Income per Share of Common Stock		=		Net income recognized in the statement of income			–			Amount not attributable to common stock (cash dividends on preferred stock, other)
				Average number of shares of common stock issued			–			Average number of shares of              treasury common stock

3. From FY2018, we apply the standard resulting after “Partial Amendments to Accounting Standard for Tax Effect Accounting” (Accounting Standards Board of Japan (“ASBJ”) Statement No.28, February 16, 2018). The amounts stated under FY2017 above have been adjusted retrospectively to reflect such amended accounting standard.

 

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(3) Employees

 

				Number of employees
March 31, 2019		Mizuho Bank, Ltd. (consolidated)			37,786
		Mizuho Trust & Banking Co., Ltd. (consolidated)			5,076
		Mizuho Securities Co., Ltd. (consolidated)			9,072
		Other			7,198
		Total			59,132
March 31, 2018		Mizuho Bank, Ltd. (consolidated)			38,058
		Mizuho Trust & Banking Co., Ltd. (consolidated)			5,019
		Mizuho Securities Co., Ltd. (consolidated)			9,091
		Other			7,883
		Total			60,051

 

Notes:

1. The number of employees is the number of persons employed by Mizuho Financial Group and its consolidated subsidiaries.

2. The number of employees includes locally hired staff outside Japan and does not include temporary employees.

3. The number of employees of Mizuho Financial Group is included in “Other.”

Reference:

The following sets forth information regarding the employees of Mizuho Bank, Mizuho Trust & Banking, and Mizuho Securities, as well as Mizuho Financial Group (collectively, the “Four Companies”):

 

		March 31, 2019		March 31, 2018
Number of employees		42,687		42,796
Average age		38 years, 6 months		38 years, 3 months
Average years of employment		14 years, 2 months		14 years, 0 months
Average monthly salary		JPY 480,000		JPY 487,000

 

Notes:

1. The number of employees is the number of persons employed by the Four Companies.

2. The number of employees is the aggregate total of employees of the Four Companies. The average age, average years of employment, and average monthly salary are the collective averages for the Four Companies.

3. The number of employees does not include temporary employees.

4. The calculations of average age, average years of employment, and average monthly salary do not take into account seconded employees and locally hired staff outside Japan. Fractions are rounded down.

5. The average monthly salary is the average salary for the month of March, pre-tax, and does not include bonuses.

 

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