Notice Regarding Unrealized Losses on Securities at the End of the Second Quarter of the Fiscal Year Ending March 2027

Overview and Causes

Shinkin Central Bank calculated unrealized losses on securities it holds, including bonds held to maturity, as of the end of the second quarter of the fiscal year ending March 2027, and recorded total unrealized losses of 671,575 million yen. Hedge-adjusted net unrealized loss was -361,381 million yen, unrealized gains totaled 1,154 million yen, and the net unrealized loss amounted to -670,420 million yen. There are no changes to the consolidated earnings guidance or dividend forecast for the fiscal year ending March 2026. The Bank implements hedging using interest rate swaps to attempt to mitigate unrealized losses in the event of rising interest rates.

Outlook and Impact

The disclosed information states that there is no change to the consolidated earnings guidance or dividend forecast for the fiscal year ending March 2027 as published on May 20, 2027. It notes that future performance depends on market interest rate trends and the valuation assumptions used, and is therefore uncertain; the effectiveness of future hedging strategies and valuation fluctuations of securities may affect performance.