Regarding the Change in the Method of Calculating the Capital Adequacy Ratio

Details of the Calculation Method Changes

The Hyakujushi Bank, Ltd. will, with approval from the Financial Services Agency, change the method for calculating the capital adequacy ratio starting from the calculation at the end of March 2026. The credit risk calculation method will shift from the current standardized approach to a foundation internal ratings-based approach using the bank’s internal credit ratings. The operational risk equivalent amount calculation method will also change from the previously specified ILM value of 1 to a standardized measurement method using a multiplier based on internal loss data. These changes will enable more appropriate reflection of risk changes in the capital adequacy ratio.

Purpose and Future Outlook

The purpose of these changes is to more accurately reflect the risks inherent in the bank, to enhance risk management systems, and to maintain soundness, thereby aiming to improve sustainability. Through these efforts, the bank intends to contribute to the creation of well-being in the local community as outlined in its "Long-Term Vision 2030" by providing more attractive products and services. The new capital adequacy ratio calculation results are scheduled to be announced in mid-May 2026.