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Annual Report 2010Year ended March 31, 2010
ACOM CO., LTD.
Overcoming the Hard Times
Corporate Philosophy
Based on our twin mottos of
“respecting other people” and “putting the customer first,”
we will continue to
pursue an innovative and creative style of
corporate management aimed at
helping our customers realize happier and
more fulfilling personal lives.
In 1936, ACOM was founded on the ideal of “extending the feeling of confidence from people to people.” Since then, we have always sought to develop our business
by establishing an unshakable mutual trust between us and our customers.
We are hard-working and humble as we carry out our business of helping our customers achieve satisfying lives.
We strive to establish an unshakable mutual trust between us and our customers.
We constantly attempt to haveheart-warming relations
with our customers that are based ontheir interests.
Affection
Confidence
Moderation
ACOM is an acronym created from the following three words:
1
Contents
Notes:1. Forward-Looking Statements
The figures contained in this annual report with respect to ACOM’s plans and strategies and other statements that are not historical facts are for-ward-looking statements about the future performance of ACOM which are based on management’s assumptions and belief in light of the infor-mation currently available to it and involve risks and uncertainties and actual results may differ from those in the forward-looking statements as aresults of various facts. Potential risks and uncertainties include, without limitation, general economic conditions in ACOM’s market and changesin the size of the overall market for consumer loans, the rate of default by customers, the fluctuations in number of cases of claims from and theamount paid to customers who claim us to reimburse the portion of interest in excess of the interest ceiling as specified in the Interest RateRestriction Law, the level of interest rates paid on the ACOM’s debt and legal limits on interest rates charged by ACOM.
2. All amounts are truncated to the nearest expressed unit.
3. Percentage figures are a result of rounding.
2Financial Highlights
4Message from the Management
7Special Feature
ACOM in the New Regime
13Overview of Businesses
21ACOM’s Management Structure
33ACOM in Figures
Related Macroeconomic Data/Six-Year Consolidated Financial Summary/Seven-Year Non-Consolidated Financial Summary/Other Business-Related Data
59Financial Section
163The ACOM Group
164Organization Chart
165Corporate Data
2
Financial HighlightsACOM CO., LTD. and Subsidiaries
Profit and Loss Related:Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision of Allowance for Doubtful Accounts *1 . . . . . . . . .Provision for Loss on Interest Repayment *2 . . . . . . . . . . . . .Other Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . .
Operating Income (Loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Income (Loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance Sheet Related:Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Receivables Outstanding*3 . . . . . . . . . . . . . . . . . . . . . . . . . . . .Total Amount of Non-performing Loans . . . . . . . . . . . . . . . .Allowance for Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Per Share:Net Income (Loss), Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cash Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Ratios:Operating Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROE*5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Operating Efficiency *6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROA1 (Net Income to Total Assets) *5 . . . . . . . . . . . . . . . . . . .ROA2 (Net Income to Receivables Outstanding) *5 . . . . . . . . .Shareholders’ Equity Ratio . . . . . . . . . . . . . . . . . . . . . . . . . . .Non-performing Loans Ratio (Gross Basis) [Non-Consolidated]*7 . .Non-performing Coverage Ratio [Non-Consolidated]*8 . . . . . . . . .
Notes: 1. The amount of provision of allowance for doubtful accounts is the sum of bad debts expenses, increase or decrease in allowance for accounts receivable-operating loans,and increase or decrease in provision for loss on guarantees. In addition, the amount of provision of allowance for doubtful accounts includes loss on sales of accountsreceivable-operating loans from the fiscal year ended March 31, 2009.
2. Provision for loss on interest repayment represents the sum of interest repayments, ACOM’s voluntary waiver of repayments accompanied with interest repayment, andincrease or decrease in provision for loss on interest repayment.
3. Receivables outstanding indicates the sum of receivables outstanding of the loan business, credit card business, and installment sales finance business.
445,431
335,039
117,125
37,228
180,685
110,392
65,595
2,106,681
1,834,628
114,371
131,620
927,722
416.69
5,901.69
140
24.8
7.3
11.8
3.1
3.6
44.0
6.9
112.0
2006/3
434,968
314,577
140,505
—
174,072
120,391
70,319
2,075,389
1,851,454
80,259
135,350
697,166
487.77
4,855.98
80
27.7
10.5
9.2
3.3
3.7
33.6
4.9
162.2
2004/3
433,965
289,604
108,453
—
181,151
144,361
81,533
2,077,334
1,856,962
83,961
130,532
863,760
516.23
5,456.39
100
33.3
10.4
9.8
3.9
4.4
41.6
5.1
150.7
2005/3
Industry Trends and ACOM’s Initiatives >
April 2003-March 2005———Japan’s consumer finance industry was born
in the 1960s after a period of high-level eco-nomic growth. Thereafter, the market grewsignificantly, to around ¥12 trillion at its peak.During that time, ACOM became one of theindustry leaders, with a market share of about16% in its core loan business. To further expe-dite growth, the ACOM Group also activelyadvanced its diversified financial services busi-ness and its overseas operations.
3
Millions of Yen
423,652
508,755
137,595
200,147
171,013
(85,102)
(437,972)
2,031,829
1,734,139
149,453
128,798
457,165
(2,786.19)
2,863.16
100
(20.1)
(63.6)
20.8
(21.2)
(24.5)
22.2
9.4
85.6
2007/3
379,706
298,054
115,848
19,620
162,586
81,651
35,406
1,861,505
1,561,839
136,396
119,882
472,144
225.24
2,950.01
100
21.5
7.7
11.1
1.8
2.1
24.9
9.4
87.0
2008/3
324,396
293,666
87,899
52,157
153,610
30,729
13,662
1,605,567
1,384,193
128,223
93,037
452,406
86.91
2,831.36
70
9.5
3.0
14.0
0.8
0.9
27.7
9.9
72.3
2009/3
278,795272,732
89,65458,362
124,7166,063
(7,239)
1,482,5201,231,949
116,69470,449
439,269
(46.18)2,773.59
10
2.2(1.6)14.0 (0.5)(0.6)29.3
9.9 56.5
2010/3
Operating Revenue and Operating Margin
Billions of yen
500
%
400
300
200
0
’09/3’08/3’07/3’06/3 ’10/3
50
40
30
20
0
100 10
-20
Operating Revenue Operating Margin (right axis)
’09/3’08/3’07/3’06/3 ’10/3
%
6
4
2
-26
-24
Receivables Outstanding and ROA2
Billions of yen
-2
00
2,000
%
8
1,500
1,000
500
Receivables Outstanding ROA2 (right axis)
’09/3’08/3’07/3’06/3 ’10/3
Cash Dividends per Share
Yen
0
150
100
50
%
Yen
Notes: 4. Net assets excludes minority interests in consolidated subsidiaries.5. ROE and ROA are calculated using the simple average of beginning and end of term balance sheet figures.6. Operating efficiency = Operating expenses excluding provision of allowance for doubtful accounts / Average of beginning and end of term receivables outstanding 7. Non-performing loans ratio (Gross basis) = Total amount of non-performing loans / Loans receivable plus loans to borrowers in bankruptcy or under reorganization8. Non-performing loans coverage ratio = Allowance for doubtful accounts / Total amount of non-performing loans
April 2005-March 2010———Requirements were made stricter for the application of “constructive repayment” following a
Supreme Court ruling on January 13, 2006. As a result, requests for interest repayment rosesharply. Seeking to solve multiple debts problems, the government revised the Money LendingBusiness Act in December 2006 (with full enforcement on June 18, 2010), reducing the maximuminterest rate on loans and placing restrictions on total loan amounts to each borrower. To addressthese changes, ACOM in November 2006 announced its “Group Management Reform” aimedat dramatically reducing operating costs through March 2011. We also acted swiftly, ahead ofthe full enforcement of the revised Money Lending Business Act, to reduce our maximum inter-est rate while adopting more stringent lending criteria in order to improve the quality of ourcredit portfolio. Due to the unprecedented severity of the operating environment, however, inNovember 2009 we announced our “Strengthening Business Management Policy” on the prem-ise of further cuts in operating costs. Since then, we have launched new initiatives in this area.
4
Fiscal 2009 Performance
In fiscal 2009, ended March 31, 2010, the ACOM Group’s operating environment continued to increase in severity due to various fac-
tors. These included shrinkage of the consumer credit market and falling profitability amid the incremental enactment of the revised
Money Lending Business Act, together with ongoing requests for interest repayments, which placed direct pressure on management.
Impacted by these factors, the ACOM Group posted a 14.1% year-on-year decline in consolidated operating revenue, to
¥278.7 billion. This was due to a decrease in the balance of accounts receivable-operating loans and a fall in average loan yield
during the year. Despite additional provision for loss on interest repayment and an increase in provision of allowance for
doubtful accounts, operating expenses were down 7.1%, to ¥272.7 billion, reflecting the effects of cuts in operating costs.
Accordingly, operating income fell 80.3%, to ¥6.0 billion. In other items, the Group reported an extraordinary loss in the form
of business structure improvement expenses aimed at further strengthening its business management. This resulted in a net loss
of ¥7.2 billion, a deterioration of ¥20.9 billion from the previous fiscal year.
Return to Shareholders
With respect to shareholder return, our basic policy is to return profits in a steady and consistent manner, with due consideration to the
Group’s business performance, shareholders’ equity, and economic and financial conditions. Based on this policy, we declared a year-end
dividend of ¥5.00 per share. Combined with the ¥5.00 interim dividend already paid, this brings annual dividends to ¥10.00 per share.
Further Reinforcement of Business Management
From an early stage, the ACOM Group envisaged the impact of falling balance of accounts receivable-operating loans and
Message from the Management
In our relentless quest to seize the No.1 share of the personal
loan market, we will respond appropriately to changing
business conditions and embrace the challenge of trans-
forming our business model in our closer alliance with the
MUFG Group, guided by our “Strengthening Business
Management Policy.”
Shigeyoshi Kinoshita Chairman, President & Chief Executive Officer
5
declining average loan yield caused by the revised Money Lending Business Act. Accordingly, in November 2006 we
announced our “Group Management Reform” set for completion in the year ending March 2011, and worked on reforming
our cost structure. Thanks to these efforts, we reached our operating cost reduction target of ¥40.0 billion in fiscal 2009—one
year ahead of schedule.
In addition, we further strengthened our internal control framework ahead of the full enforcement of the revised Money
Lending Business Act, and in June 2007 we expedited reductions on the maximum interest rates on our loans. In these and
other ways, we worked swiftly to address the changing operating environment.
Due to the ongoing high level of requests for interest repayment and a declining balance of accounts receivable-operating
loans, however, business conditions surrounding the ACOM Group have become more difficult than in November 2006,
when the “Group Management Reform” was formulated.
Responding to these circumstances, in November 2009 we announced our “Strengthening Business Management Policy,” a
set of management reinforcement measures. Under this policy, we will strive to reduce operating costs to ¥60.0 billion by the
year ending March 2012, or ¥32.1 billion lower than the year ended March 2009. At the same time, we will reorganize our
office network, enhance personnel efficiency, and otherwise implement drastic reductions to our operating costs.
Progress of Business Alliance with the MUFG Group
We continue to make steady progress with functional reorganization and efficiency enhancement measures involved in making
ACOM the core consumer finance company in Mitsubishi UFJ Financial Group, Inc. (“MUFG”).
In the year under review, we transferred the credit card guarantee business of DC Cash One Ltd. (“DCC1”), then a consoli-
dated subsidiary, to Mitsubishi UFJ NICOS Co., Ltd. (“Mitsubishi UFJ NICOS”), and integrated DCC1’s loan business into
ACOM. At the same time, RELATES CO., LTD. (“RELATES”), a consolidated subsidiary that is entrusted with call center
functions, was merged into MU Communications Co., Ltd. (“MU Communications”), the call center arm of The Bank of
Tokyo-Mitsubishi UFJ, Ltd. (“BTMU”) In addition, ACOM took over the unsecured card loan guarantee business of
Mitsubishi UFJ Home Loan Credit Co., Ltd. (“Mitsubishi UFJ Home Loan Credit”) ACOM is also scheduled to take over the
unsecured card loan guarantee business of Mitsubishi UFJ NICOS in October 2010.
Outlook for Fiscal 2010
Although requests for interest repayment remain at high levels, the trend began showing negative year-on-year growth in
November 2009, and the magnitude of declines has gradually widened in the subsequent months. However, the situation
remains unpredictable since the economic outlook is unclear, and at fiscal year-end 55.6% of customers subject to borrowing
restrictions had loans exceeding one-third of their annual income. With the loan business facing so many uncertainties, there-
6
fore, it is extremely difficult to make predictions about the year ending March 2011. At the present time, however, we forecast
a 12.5% year-on-year decrease in consolidated operating revenue, to ¥243.9 billion, in light of the declining balance of
accounts receivable-operating loans and falling average loan yield. Moreover, we forecast a 22.4% decline in operating expenses,
to ¥211.7 billion, taking into consideration rising interest rates on fund procurement, provision of allowance for doubtful
accounts and provision for loss on interest repayment we plan to make based on our financial performance in the year under
review, as well as reduction in operating costs. As a result, we project a 431.1% surge in operating income, to ¥32.2 billion, and
net income of ¥26.2 billion.
ACOM Group’s Management Vision
Fiscal 2010, ending March 31, 2011, is the first year of the ACOM Group’s new medium-term business plan, the five year
management vision of which is to “aim to become the ‘leading company’ which provides the greatest satisfaction to as many cus-
tomers as possible and wins the trust of the personal loan market.” This management vision embodies three key points based
on the “sphere of trust” spirit maintained since our foundation, which forms the basis for our Group-wide corporate activities,
the three words—Affection, Confidence, Moderation—that constitute the ACOM acronym, and our corporate philosophy.
Three Points Embodied in Management Vision
• Ensure commitment of each and every Group employee to “maximize satisfaction for as many customers as possible” as
reflected in our belief that customers lie at the heart of business and our corporate philosophy of “putting the customer first.”
• Concentrate managerial resources with a focus on the personal loan market—the market for lending money to individuals,
and the market for providing guarantees for such loans—regardless of service category (specialized consumer financing,
installment sales finance, credit card, banking).
• Establish a powerful brand by stepping up efforts to “foster brand image of reliability and trust” and become recognized as a
“leading company trusted by society.”
Guided by this management vision, we will respond appropriately to changing business conditions and embrace the chal-
lenge of transforming our business model, in our relentless quest to seize the No.1 share of the personal loan market. We look
forward to your ongoing and renewed support for these endeavors.
Shigeyoshi Kinoshita Chairman, President & Chief Executive Officer
7
Special Feature
ACOM in the NEW REGIME
8
Number of Money Lenders and Receivables Outstanding of Money Lenders Providing Unsecured Consumer Loans(10 years)
6,178
0
15,000
10,000
5,000
’00/3 ’01/3 ’02/3 ’03/3 ’04/3 ’05/3 ’06/3 ’07/3 ’08/3Receivables Outstanding of Money Lenders Providing Unsecured Consumer Loans Number of Money Lenders (right axis)
* Source: JFSA White Paper for FY 2009 published by Japan Financial Services Association
0
Billions of yen
30,000
20,000
10,000
’09/3
7,285
Amid the full enforcement of the revised Money Lending Business Act, ACOM is stepping up its pursuit of management rein-
forcement measures. At the same time, we are expediting our “selection and concentration” strategy under our alliance with the
MUFG Group, in our quest to become the leading company in the personal loan market.
Impact of Revised Money Lending Business Act
The revised Money Lending Business Act was fully enacted on June 18, 2010. This marks the introduction of restrictions on loan vol-
umes provided by money lenders. For loan applications exceeding ¥500,000 (to a single money lender) or ¥1 million (total loans), the
lender must now obtain documented proof of income from the borrower. Moreover, loans exceeding one-third of the borrower’s
annual income are now prohibited.
The impact of the revised Money Lending Business Act has been felt for some time—since its enactment were announced in
December 2006. In fact, the effects have spread beyond the consumer finance industry to include the credit card and install-
ment sales finance sectors, which have suffered declining loan balances and profitability, as well as the inevitable restructuring
of the industry.
More than Half of Borrowers Affected
In April 2010, the Japan Financial Services Association released its report on a survey it conducted related to recognition of the
revised Money Lending Business Act. According to the report, 51.2% of consumer finance customers had borrowings exceeding one-
third of their annual income. In other words, the survey reveals that more than half of customers will be unable to obtain additional
financing once the revised law is fully enforced.
9
Ratio of Borrowers Subject to Total Loan Volume Restrictions Borrowers’ Need for Further Loans(Borrowers subject to restrictions)
* Source: Report on the “Survey Related to Recognition of the Revised Money Lending Business Act” by the Japan Financial Services Association
48.8%
Not subject to restrictions
n=5,625 n=379
51.2%
Subject to restrictions
48.8%
Not necessary
51.2%
Necessary
The survey report also gave a breakdown of borrowers subject to restrictions by annual income: ¥3 million or less (67.6%), ¥3.01
million-¥5 million (43.4%), ¥5.01 million-¥7 million (42.3%), and ¥7.01 million or more (36.4%). This shows that the restrictions
have a greater impact on those in the lower-income brackets. Moreover, 77.3% of those subject to restrictions responded that they
had not planned to confine their borrowings to less than one-third of their annual income.
With the full enforcement of the revised Money Lending Business Act, the lending ratio for unsecured loan applications has been
declining, caused inevitable shrinkage in loan balances. At the present time, moreover, it is hard to predict the behavior of borrowers
who have trouble making loan repayments due to the aforementioned restrictions on loan volumes.
Concentrating Business Resources on Personal Loan Market
However, the social need for speedy and convenient financing services, collateralized on consumer trust, will not disappear. While
customers subject to total loan volume restrictions may be unable to obtain additional financing, 51% of them indicated that they
would require new borrowings to maintain their future lifestyles. Meeting the needs of such people requires advanced lending know-
how based on a record of transactions over many years.
In this context, ACOM reduced its maximum loan interest rate and expedited actions to build a rock-solid business foundation
capable of withstanding market contraction due to total loan restrictions. We are also pursuing a selection and concentration strategy
in areas where we can demonstrate our strength in credit screening know-how. We have identified the “personal loan market” as the
target for our services. This consists of the “market for lending money to individuals” and the “market for providing guarantees for
such loans” and does not focus on any particular category, such as specialized consumer financing, installment sales finance, credit
card, and banking. ACOM is concentrating its business resources on this key market in its role as the core consumer finance company
of the MUFG Group.
10
Consumer Credit
Unsecured Loan Business
Installment Sales Finance Business
Loans Secured by Deposits orPersonal Property
Consumer Loans
13 trillion of yen
Consumer Finance
Sales Credit
Mail Order Business
Others
ACOM’s Target Markets
87.7
Announcement of 40 billion yen reduction target in November 2006
Announcement of 32.1 billion yen reduction target in November 2009
Operating Cost (Other Operating Expenses)
0
150
100
50
’06/3 ’07/3 ’08/3
Billions of yen
’12/3’10/3 ’11/3’09/3
60.075.3
126.9
112.4
92.3 92.182.4
Actualcost
Guarantee Business
Achieved one year ahead of schedule
ACOM’s Target: Personal Loan Market
Japan’s private-sector financial institutions are generally classified into two groups: banks (which lend money and accept
deposits) and non-banks (which do not accept deposits but provide financing to individuals and companies). The non-bank sec-
tor includes a multitude of subcategories, such as loan companies, installment sales finance companies, credit card companies,
and leasing companies.
The consumer credit sector, which extends loans and credit mainly to individuals, is classified into two subsectors: (1) sales credit,
where companies pay vendors for product and service purchases on behalf of the consumer; and (2) consumer finance, where compa-
nies provide direct financing. Included within consumer finance is the consumer loan market segment, which excludes loans secured
by savings and deposits or personal property (handled by private-sector financial institutions and post offices). This market segment
has a broad range of participants, including banks and nonbanks.
ACOM regards the consumer loan market as the target for both of its loan and guarantee businesses, defining it as the personal
loan market. Our medium-term vision is to obtain the No.1 share of the market in total balance of unsecured loan receivables and
guaranteed receivables combined.
Management Reinforcement Measures: Major Hurdles
The ACOM Group was quick to envisage that the revised Money Lending Business Act would lead to declines in the balance of
accounts receivable-operating loans and average loan yield. For this reason, in November 2006 we announced our “Group
Management Reform” set for completion in the year ending March 2011, and have been working to reform our cost structure. Thanks
to these efforts, we reached our operating cost reduction target of ¥40.0 billion in fiscal 2009—one year ahead of schedule.
11
Agreement
Consolidation
BusinessRestructuring
September 2008Further strengthened business and capital alliance with the MUFG GroupThe MUFG Group’s ratio of voting rights: 40.04%, up from 15.77%
Progress of Business Alliance with the MUFG Group
December 2008Became a consolidated subsidiary of MUFG
April 2009Transferred the credit card guarantee business of DCC1 Ltd. to Mitsubishi UFJ NICOS
April 2009Merged RELATES (consolidated subsidiary that is entrusted with call center functions) into MU Communications, which became an equity-method affiliate of ACOM
May 2009Merged the loan business of DCC1
September 2009Succeeded the unsecured card loan guarantee business of Mitsubishi UFJ Home Loan Credit
October 2010Scheduled to succeed the unsecured card loan guarantee business of Mitsubishi UFJ NICOS
However, business conditions have since become more severe than in November 2006, and are expected to get even worse in the
future. In November 2009, therefore, realizing that we would achieve our operating cost reduction target at an early stage, we formu-
lated a new set of management reinforcement measures. Under these measures, we will strive to reduce operating costs to ¥60.0 bil-
lion or less by the year ending March 2012. To achieve this, we will reorganize our office network, enhance personnel efficiency, and
otherwise reduce costs through drastic reassessments focusing on cost-benefit analysis.
Among measures to enhance personnel efficiency, we have created a voluntary retirement program targeting 550 employees, 446 of
whom are now confirmed. Adding 182 employees who have retired in connection with consolidation of our outlets, we have reduced
our full-time workforce by 628.
Under our office network reorganization, we reduced the number of staffed outlets from 118 to 45, concentrated operating centers
from 4 to 2, and unstaffed outlets from 1,489 to 1,308 as compared to March 31, 2009. By March 31, 2011, we plan to reorganize
unstaffed outlets into 1,200.
Other operating cost reductions include computer expenses (down ¥3.4 billion), advertising expenses (down ¥1.7 billion), and oth-
ers (down ¥2.6 billion), for a total reduction of ¥7.7 billion from the previous fiscal year. In the year ended March 2010, we lowered
total operating costs by ¥9.6 billion, to ¥82.4 billion.
In the fiscal year ending March 2011, we expect to see further benefits from cost-cutting measures implemented so far, including
office network reorganization and personnel efficiency enhancement. Accordingly, we forecast a further ¥7.1 billion reduction in total
operating costs for the year, to ¥75.3 billion. This will include a ¥4.9 billion decline in personnel expenses and a ¥1.2 billion decrease
in office expenses.
12
Receivables Outstanding and Guaranteed Receivables of Unsecured Consumer Loans
0
1,500
1,000
500
’07/3 ’07/9 ’08/3 ’08/9 ’09/3’07/6 ’07/12 ’08/6 ’08/12 ’09/6 ’09/9 ’09/12 ’10/3Receivables Outstanding Guaranteed Receivables
* Guaranteed receivables represent non-consolidated figures of ACOM.
Billions of yen
’11/3 (Forecast)
922.5
355.8
1,074.8
317.2
Absorbed theloan business of
DCC1
Succeeded the unsecuredcard loan guaranteebusiness of MULC
Steady Progress in the MUFG Group Alliance
ACOM Becomes Consolidated MUFG Subsidiary and Expedites Selection and Concentration Strategy
ACOM is committed to building a consumer finance business with an overwhelming competitive edge. Similarly, MUFG is committed
to fostering its consumer finance business as a growth area. Accordingly, ACOM, MUFG, and BTMU reached an agreement in
September 2008 to make ACOM the core consumer finance arm of the MUFG Group—thus further reinforcing the strategic busi-
ness and capital alliance between ACOM and MUFG in the retail sector, formed back in March 2004. ACOM consequently became
a consolidated subsidiary of MUFG in December 2008 while maintaining its independence. Since then, we have focused our business
resources on three businesses—unsecured loans, guarantee, and loan servicing—with the aim of strengthening operational efficiency
and boosting profitability.
ACOM Takes Over Unsecured Card Loan Guarantee Business
In the guarantee business, where major future growth is expected, the MUFG Group is taking steps to reorganize its functions and
enhance efficiency. These include expediting ACOM’s takeover of MUFG’s unsecured card loan guarantee business.
In the year ended March 2010, ACOM took over the unsecured card loan guarantee business of Mitsubishi UFJ Home Loan
Credit. We have also worked to increase guaranteed receivables, including by supporting sales promotion activities for loan products
offered by existing alliance partners, centering on BANQUIC, an unsecured card loan offered by BTMU. As a result, ACOM’s
guaranteed receivables outstanding jumped 174.1% during the year, to ¥317.2 billion, and generated a 71.0% increase in operating
revenue, to ¥14.2 billion.
In October 2010, ACOM is scheduled to take over the unsecured card loan guarantee business, valued at around ¥110 billion, of
Mitsubishi UFJ NICOS.
OVERVIEW of BUSINESSES
14Business Highlights
16Operations by Business Segment
For more details of each segment, including customer attributes, pleasesee the ACOM in Figures section on pp. 33-58.
13
Business Highlights
Segment Business Overview
LOAN BUSINESS
DIVERSIFIED FINANCIAL SERVICES
GUARANTEE BUSINESS
CREDIT CARD BUSINESS
INSTALLMENT SALESFINANCE BUSINESS
LOAN SERVICING BUSINESS
BANKING BUSINESS
The loan business, centering on unsecured loans for consumers, is the ACOM Group’s core business. ACOM has acquiredadvanced credit screening expertise based on data from more than 9 million customers it has served in the past. We are uti-lizing this expertise to extend loans through various channels. In addition to our own network of branches and automaticcontract machines, these include our own ATMs, as well as alliances with convenience stores and financial institutionsaimed at making provision and repayment of loans as easy as possible. In addition, we have opened a multitude of saleschannels, including Internet services offered via personal computers and mobile phones, as well as call centers. In Japan, weprovide speedy loans services under two brands: ACOM and Cash One.
Overseas, we are focusing on the Asian market. There, EASY Buy Public Limited (“EASY BUY”), our subsidiary inThailand, is advancing its business in providing unsecured loans to individuals.
ACOM provides guarantees on unsecured personal loans via alliances with financial institutions, centering on prominentregional banks. Guarantee fees received on guaranteed receivables represent a major source of revenue. Amid ongoing busi-ness reorganization of the MUFJ Group to centralize its unsecured card loan guarantee business within ACOM, we are pro-viding guarantee arrangements tailored to the needs of alliance partners, from product planning to loan collection, and thebalance of guaranteed receivables is growing steadily as a result. We also provide guarantees on business loans. As of March31, 2010, ACOM had tie-ups with 17 banks.
In 1998, ACOM acquired principal membership of MasterCard International and subsequently entered the credit cardbusiness. In addition to our own ACOM card, we have issued other cards in alliance with large-scale retail chains andother companies.
Due to rapidly changing business conditions in recent years, however, we have gradually switched to a policy of cancelingalliance cards as their card renewal date approaches. Instead, we are encouraging alliance cardholders to switch to an ACOMcredit card. As of March 31, 2010, there were 374 thousand holders of cards issued by the ACOM Group.
In this segment, the ACOM Group specializes in installment sales finance services. When a customer wishes to purchase anitem, we pay the retailer in advance, and the customer reimburses us in subsequent installments. We offer a broad range ofpayment options to meet the diversifying needs of customers.
In Japan, our installment sales finance business is handled by AFRESH CREDIT CO., LTD. (“AFRESH CREDIT”). InAsia, we are advancing this business via EASY BUY, our subsidiary in Thailand.
The primary income sources in our loan servicing business are commissions received from banks, life insurers, and otherfinancial institutions for handling their debt collection activities on consignment, as well as marginal profit derived fromrecovery of loans purchased. IR Loan Servicing, Inc. (“IR Loan Servicing”), which handles the ACOM Group’s loan servic-ing business, is developing a comprehensive loans servicing business that takes full advantage of ACOM’s consumer loanservicing know-how and business loan management techniques.
In December 2007, ACOM acquired PT. Bank Nusantara Parahyangan, Tbk (“Bank BNP”), based in Indonesia, in ajoint arrangement with BTMU. Now a consolidated ACOM subsidiary, Bank BNP is advancing its banking businessin Indonesia.
14
Group Companies Composition of Operating Revenue (Five year period)
• PT. Bank Nusantara Parahyangan, Tbk.
• ACOM CO., LTD.• EASY BUY Public Company Limited
• ACOM CO., LTD.
• ACOM CO., LTD.
• AFRESH CREDIT CO., LTD.• EASY BUY Public Company Limited
• IR Loan Servicing, Inc.• General Incorporated Association Mirai Capital• Power Investments LLC
89.3%
86.1%
FY2004 FY2009
FY2004 FY2009
10.7%
13.9%
15
16
Loan Business (Consolidated)Operating Revenue and Receivables Outstanding
Billions of yen
0
2,000
1,500
1,000
500
Receivables OutstandingConsolidated Operating Revenue
Lending Ratio (Non-Consolidated)Number of Application and Monthly-Lending Ratio
0 0
50,000
%
50.0
40.0
35.0
30.0
0
Thousands
4,000
3,000
2,000
1,000
30,000
45.040,000
20,000
10,000
’09/3 4 5 6 7 8 9 10 11 12 ’10/1
38.0
Number of Application Monthly-Lending Ratio (right axis)
2,7202,580
1,174
240
1,017
204
32’11/3’10/3 (Forecast)’09/3’08/3’07/3
Number of Customer Accounts (right axis)
LOAN BUSINESS
Basic Strategies
In May 2009, DCC1—an ACOM consolidated subsidiary estab-
lished in 2001 jointly with the MUFG Group—was merged into
ACOM in line with the business reorganization of the MUFG
Group. Through this action, we will enhance the efficiency of our
double-brand strategy in our Japanese loan business, centering on
the “ACOM” and “DCC1” brands. At the same time, we will
adopt measures to further reinforce our business foundation in
response to the revised Money Lending Business Act. Overseas,
EASY BUY, our consolidated subsidiary in Thailand, holds a
prominent position in that market. Deploying high-quality serv-
ices based on ACOM’s know-how, EASY BUY is expanding its
business as a provider of unsecured loans to individuals.
Fiscal 2009 Highlights
Adopting stricter lending criteria
ACOM’s adoption of stricter lending criteria led to a decline in the
lending ratio on new loans. Nevertheless, we are making steady
progress in improving the quality of our loan portfolio, characterized
by customers with a low number of loans with other companies.
In the approach to the full enforcement of the revised Money
Lending Business Act on June 18, 2010, we have incrementally
raised the stringency of our credit screening criteria. Accordingly,
the lending ratio for new unsecured loans to individuals declined
to 36.8% in the year under review, from 40.6% in the previous
year, and the number of new borrowers fell 13.3%, to 160,700.
Reflecting the success of our meticulous credit screening criteria,
the ratio of unsecured loans contracts in which customers had zero
or one loan with other companies among outstanding loans was
85.2% at the end of fiscal 2009, up from 68.1% at the end of fiscal
2006. Meanwhile, the ratio of existing contracts in which customers
had zero or one loan with other companies among outstanding
loans was 55.3% at March 31, 2010, up from 47.7% three years
earlier. By contrast, the ratio of existing contracts in which cus-
tomers had four loans or more with other companies was 11.5% at
March 31, 2010, down from 22.4% three years earlier.
Reorganizing our office network to
further reinforce business foundation
To ensure a smooth response to the full enforcement of the revised
Money Lending Business Act, in the year under review we reduced
the number of concentrated operating centers from four to two, and
also reorganized our network of staffed and unstaffed outlets.
Actively advancing our operations in Thailand
During the year, EASY BUY sought to improve the quality of its loan
assets by enhancing its credit screening model. It also opened numer-
ous new booths dedicated to accepting new loan applications and
actively advanced its sales initiatives, resulting in an increase in its
loan receivables outstanding.
Fiscal 2009 Results
On a consolidated basis, receivables outstanding in the loan busi-
ness declined to ¥1,173.5 billion at fiscal year-end, down 10.8%
from a year earlier. Consolidated operating revenue in the loan
business declined 13.5% year on year, to ¥240.0 billion. The prin-
cipal factors in these results were declines in the balance of
accounts receivable-operating loans and the average loan yield dur-
ing the year.
Operations by Business Segment
17
EASY BUYOperating Revenue and Receivables Outstanding
Billions of yen
80
60
40
20
Receivables OutstandingOperating Revenue18.000%＜ ≦18.000%
Unsecured Accounts Receivable-Operating Loansby Interest Rate [Unsecured Consumer Loans] (Non-Consolidated)
%
0
100
80
60
40
20
72.661.2
38.827.4
73
22
67
19
0 ’11/3’10/3 (Forecast)’09/3’08/3’07/3’11/3’10/3 (Forecast)’09/3’08/3’07/3
Continued contraction of domestic market
The Japanese market continued to shrink. On a non-consolidated
basis, loan receivables outstanding decreased 5.8%, to ¥1,103.9 bil-
lion, despite the beneficial impact of ACOM taking over the loan
business of DCC1. The number of customer accounts declined
8.7%, to 1.94 million, and the number of new customers fell
13.3%, to 160 thousands. The average loan yield over the period
was 18.41%, down 91 basis points from the previous year. Non-
consolidated operating revenue in the loan business fell 10.2%, to
¥219.6 billion.
Interest repayment claims turn downward in second half
(year-on-year basis)
In the year under review, the monthly average number of interest
repayment claims remained high, at 12,200. Also, with the exception
of June 2009, when reconciliation alleviated claims on a large num-
ber of loans, average monthly interest repayments for the year fluctu-
ated between ¥6.0 billion-¥8.0 billion. On quarter basis, interest
repayments fluctuated between ¥20.0 billion-¥23.0 billion.
In November 2009, however, the number of monthly claims
turned downward on a year-on-year basis, and the magnitude of
declines subsequently widened through fiscal year-end.
Steady growth in Thailand
EASY BUY actively advanced its operations during the year. As a
result, receivables outstanding in EASY BUY’s loan business grew
7.4% on a local-currency basis, to 24.2 billion baht. In yen terms, as
well, loan receivables outstanding climbed 14.0%, to ¥66.8 billion,
but operating revenue slipped 2.1%, to ¥19.3 billion.
Fiscal 2010 Outlook
On a consolidated basis, ACOM forecasts a 13.4% decrease in
receivables outstanding in its loan business, to ¥1,016.7 billion.
On a non-consolidated basis, we project a 14.5% decline, to
¥943.6 billion. EASY BUY forecasts a 9.3% year-on-year increase
in receivables outstanding, to ¥73.1 billion.
In the Japanese market, however, the economic outlook is
unclear and the business environment is full of uncertainties in
the wake of various factors, including the full enforcement of the
revised Money Lending Business Act on June 18, 2010 and
trends in interest repayment claims. Under these conditions, the
adoption of restrictions of total loan amounts is expected to cause
declines in the lending ratio on new loans and average loan yield.
In response, we are taking various measures, including effective
advertising, in an effort to attract new, high-quality customers.
However, further declines in loan balances and average loan yield
will be unavoidable. On a non-consolidated basis, therefore, we
forecast a 16.8% fall in operating revenue, to ¥182.7 billion.
For the year, on a non-consolidated basis ACOM expects to
make ¥84.3 billion in total provision of allowance for doubtful
accounts and provision for loss on interest repayment.
EASY BUY will continue working to expand its operations
while raising the quality of its loan assets by enhancing its credit
screening model. Accordingly, EASY BUY forecasts an 11.6% rise
in operating revenue, to ¥21.6 billion.
For the entire segment, on a consolidated basis we expect a
14.9% fall in operating revenue, to ¥204.3 billion.
18
(Forecast)
Guarantee Business (Consolidated)Operating Revenue and Guaranteed Receivables
Billions of yen
0
400
300
200
100
’11/3’10/3’09/3’08/3’07/3Guaranteed ReceivablesOperating Revenue
14
317
Number of Guarantee Business Partners and Accounts(Non-Consolidated)
Thousands
0
800
600
400
200
’09/3’08/3’07/3’06/30
5
10
15
20670
CorporationBanks Accounts (right axis)’10/3
20
356 17 Banks
432
GUARANTEE BUSINESS
Basic Strategies
Deploying its credit screening expertise, ACOM has expanded its
network of alliances with prominent regional Japanese banks by
offering customized loan guarantee arrangements. As the MUFG
Group’s core company in the unsecured card loan guarantee busi-
ness, ACOM is seeking to dramatically expand the scope of its busi-
ness in this field.
Fiscal 2009 Highlights
Steady increase in guaranteed receivables outstanding
In September 2009, ACOM took over the unsecured card loan guar-
antee business of The Mitsubishi UFJ Home Loan Credit. In January
2010, we began providing guarantees for unsecured loans to individual
customers extended by Seven Bank, Ltd., bringing our network of
alliance partners in the guarantee business to 17. We also worked to
increase the balance of guaranteed receivables, including by support-
ing sales promotion activities for loan products offered by existing
alliance partners, centering on BANQUIC, an unsecured card loan
offered by BTMU.
Strengthening operating systems
In July 2009, ACOM reorganized its business promotion system
with the aim of boosting operational and personnel efficiency and
reinforcing its ability to service defaulted loans once ACOM assumes
the guaranteed debts.
Fiscal 2009 Results and Fiscal 2010 Outlook
In fiscal 2009, ACOM focused on broadening its business scope and
raising operating revenue, while implementing the aforementioned
measures aimed at improving its earnings structure. As a result, guar-
anteed receivables outstanding increased ¥172.8 billion from the pre-
vious fiscal year-end, to ¥317.2 billion, and operating revenue rose
22.9% year on year, to ¥14.2 billion.
In the year ending March 2011, we will continue providin
g sales support to our existing alliance partners while cultivating new
partners. Accordingly, we expect a 12.2% year-on-year increase in the
balance of guaranteed receivables, to ¥355.8 billion, and a 41.3%
jump in segment operating revenue, to ¥20.2 billion.
In October 2010, ACOM is scheduled to take over the unsecured
card loan guarantee business of Mitsubishi UFJ NICOS. At the pres-
ent time, we have not completed our valuation of that business’s
assets, so such valuation is not reflected in our forecasts. Once the
takeover is complete, however, we expect the balance of guaranteed
receivables to grow around ¥110.0 billion, bringing the total balance
to around ¥460.0 billion.
19
Installment Sales Finance Business (Consolidated)Operating Revenue and Receivables Outstanding
Billions of yen
0
60
40
20
’11/3’10/3 (Forecast)’09/3’08/3’07/3Receivables OutstandingOperating Revenue
32
4
Credit Card Business (Consolidated)Operating Revenue, Receivables Outstanding and Customer Accounts
Billions of yen
0 0
60
Thousands
1,500
1,000
500
40
20
’11/3’10/3 (Forecast)’09/3’08/3’07/3Receivables OutstandingOperating Revenue
Number of Cardholders (right axis)
375
29
3 222
27
4
20
3
INSTALLMENT SALES FINANCE BUSINESS
Basic Strategies
The domestic installment sales finance business of the ACOM Group
is handled entirely by its consolidated subsidiary, AFRESH CREDIT.
In this business, we are pursuing the key objectives of solidifying our
sales base and strengthening controls of existing member stores.
Overseas, we are advancing our hire purchase business in Thailand
under the EASY BUY brand.
Fiscal 2009 Results and Fiscal 2010 Outlook
In Japan, we further strengthened controls of member stores and
adopted stricter lending criteria in response to a revision of the
Installment Sales Act. As a result, AFRESH CREDIT’s install-
ment receivables outstanding declined 7.5% from the previous fis-
cal year-end, to ¥30.2 billion, while operating revenue increased
5.6% year on year, to ¥3.1 billion.
During the year, EASY BUY placed priority on reviewing its
member stores and improving the soundness of its credit portfo-
lio. Accordingly, EASY BUY’s installment receivables outstanding
fell 43.7%, to ¥1.6 billion, and operating revenue dropped
58.7%, to ¥0.8 billion.
As a result, the ACOM Group’s consolidated installment
receivables outstanding declined 10.5%, to ¥31.8 billion, and
operating revenue fell 19.8%, to ¥4.0 billion.
In fiscal 2010, we will continue placing top priority on improving
our credit portfolio, both in Japan and overseas. On a consolidat-
ed basis, we forecast an 8.9% decline in installment receivables
outstanding, to ¥29.0 billion, and a 20.0% decrease in operating
revenue, to ¥3.2 billion.
CREDIT CARD BUSINESS
Basic Strategies
In its credit card business, ACOM has been expanding its business by
issuing cards in two formats: an ACOM credit card, provided as a
value-added service for loan customers; and cards issued in alliance
with large-scale retail chains and other companies. Amid changing
market conditions, however, we have stopped issuing alliance cards.
Instead, we are encouraging alliance cardholders to switch to an
ACOM credit card as their card renewal date approaches.
Fiscal 2009 Results and Fiscal 2010 Outlook
In fiscal 2009, ACOM tightened controls over issuance of credit
cards to loan customers in order to maintain and improve the sound-
ness of its credit portfolio. We also stopped issuing new alliance
cards, instead encouraging existing alliance cardholders to switch to
an ACOM credit card as their card renewal date approaches. As a
result, the total number of cardholders at fiscal year-end was 374
thousands, down 208 thousands from a year earlier. Card shopping
receivables outstanding fell 18.2% from the previous fiscal year-end,
to ¥26.5 billion, and operating revenue from our credit card business
declined 15.4% year on year, to ¥3.9 billion.
In fiscal 2010, we expect a further 40.7% fall in the number of
cardholders. We also forecast a 24.7% decrease in card shopping
receivables outstanding, to ¥20.0 billion, and a 21.9% decline in seg-
ment operating revenue, to ¥3.1 billion.
20
(Forecast)
Loan Servicing Business (Consolidated)Operating Revenue and Receivables Outstanding
Billions of yen
0
30
20
10
’11/3’10/3’09/3’08/3’07/3Receivables OutstandingOperating Revenue
(Forecast)
Banking Business (Consolidated)Operating Revenue and Receivables Outstanding
Billions of yen
0
40
30
20
10
’11/3’10/3’09/3’08/3Operating Revenue Receivables Outstanding
1315
812
31
4.4
25
3.5
LOAN SERVICING BUSINESS
Basic Strategies
In the loan servicing business, we are utilizing ACOM’s know-how
to increase our focus on small, unsecured loans, in addition to servic-
ing business loans. Our priorities in this business are to strengthen
profitability and reinforce our loan servicing capabilities. Conditions
in this market remain severe, however, amid prolonged delays in the
recovery of the Japanese real estate market. For this reason, we are
working to improve our portfolio of operating assets while reducing
the balance of loans secured by real estate.
Fiscal 2009 Results and Fiscal 2010 Outlook
In fiscal 2009, IR Loan Servicing, the loan servicing arm of the
ACOM Group, sought to undertake more rigorous credit assess-
ments and strengthen its loan servicing capabilities. It has also been
sharing its know-how in servicing of small, unsecured loans with
ACOM in order to reinforce its overall servicing system. At the
same time, it has worked to optimize its portfolio of operating
assets by reducing the balance of loans secured by real estate.
As a result, the total principal of loans handled—sum of pur-
chased and consigned obligations—edged up 1.0%, to ¥3,666.0
billion. Purchased receivables outstanding declined 26.8% from
the previous fiscal year-end, to ¥15.3 billion. The collection of
purchased receivables was down 22.1% year on year, to ¥12.2 bil-
lion, and operating revenue fell 21.9%, to ¥12.8 billion.
In fiscal 2010, we expect business conditions to remain difficult.
We forecast a 20.3% decline in the balance of purchased receiv-
ables, to ¥12.2 billion, and a 36.2% fall in operating revenue, to
¥8.2 billion.
BANKING BUSINESS
In the banking business, Indonesia-based Bank BNP is advancing its
operations in collaboration with BTMU. In addition to establishing
and reinforcing its risk management and compliance frameworks,
Bank BNP is actively promoting loans to small and medium-sized
companies, its core target market, while placing priority on sales of
unsecured loan products. These initiatives reflect Bank BNP’s medi-
um-term vision of “becoming a national-level bank focusing on the
retail business.”
In fiscal 2009, Bank BNP extended loans valued at ¥25.3 billion,
up ¥7.2 billion, or 40.1%, from the previous year. Operating revenue
from the banking business totaled ¥3.5 billion.
In fiscal 2010, we will work to further expand our banking busi-
ness. We forecast a 21.6% increase in the loan balance in the banking
business, to ¥30.8 billion, and a 24.0% rise in banking business oper-
ating revenue, to ¥4.4 billion.
ACOM’S MANAGEMENT STRUCTURE
22Corporate Governance
29Social Contribution
30History of Creativity and Innovation
32Board of Directors
21
22
Corporate Governance
Basic Policy
The ACOM Group, guided by its lifelong “circle of trust” spirit,maintains an ongoing corporate commitment to respecting otherpeople, putting the customer first, and conducting creative andinnovative management. Based on this commitment, we are seek-ing to deepen mutual trust between our stakeholders and our-selves and thus progress in partnership with society.
In order to meet the expectations of stakeholders and buildstronger trust, we will strengthen corporate governance as a keymanagement priority. To this end, we will take steps to enhancethe soundness, transparency, and efficiency of our operations andachieve sustained increases in our corporate value.
We recognize that effective internal control systems are essen-tial to creating an appropriate corporate governance framework.Based on this recognition, we are encouraging all members of ourorganization to join forces in building internal control systemsand assuring their effectiveness, under the leadership of thePresident & CEO.
At the same time, we are constantly evaluating, verifying, andimproving the effectiveness of internal control mechanismsalready in place.
We introduced a company auditor system in order to achievethe following objectives:• Supervise the execution of duties by the Directors and the deci-
sion making by the Board of Directors that consists of internalDirectors who are closely attuned to the Company’s operations,ensuring that the decisions made are appropriate and effectivefor business execution.
• Ensure proper monitoring of the management from an objectiveand impartial standpoint by Outside Company Auditors.
• Clearly separate the supervision and business execution func-tions, and expedite business execution through the introductionof an executive officer system.
• Protect the interests of general shareholders by having inde-pendent directors/auditors.
The Content of ACOM’s Bodies and Development of its Internal Control System
(As of June 25, 2010)
(A) An Overview of Corporate Governance System and
Reasons for Employing Such a System
ACOM has a Board of Company Auditors. Of the four CompanyAuditors, three are Outside Company Auditors. In addition, of
the three Full-time Company Auditors, two are OutsideCompany Auditors. These ensure the independence of audits. AllCompany Auditors attend Board of Directors meetings, and Full-time Company Auditors divide duties to attend important meet-ings and committee meetings, ensuring a system in whichCompany Auditors can offer their opinions. Based on the above,ACOM believes that an objective and neutral surveillance of themanagement is conducted, and by ensuring fairness, health, andtransparency of the management, the functions expected ofIndependent Directors are substituted.
(B)Overview of Management Entities
(a)Board of Directors and Directors
ACOM has a reduced-size Board of Directors with 10 membersin order to speed up decision-making and ensure effective mutualmonitoring among directors. In the presence of CompanyAuditors, the Board decides important business managementmatters, such as management strategies and planning, and alsodetermines basic policies for building corporate governance andinternal control systems. On the basis of these management plansand fundamental policies, the Board monitors the performancesof the President & CEO and executive officers. It meets once amonth in principle, and more as deemed necessary.
(b)Board of Company Auditors and Company Auditors
The Board of Company Auditors consists of four CompanyAuditors, including three Outside Company Auditors. Theinternal Company Auditor held the positions of Chief GeneralManager of the Accounting Department and Director and ChiefGeneral Manager of the Accounting Department from April1990 to June 2003 and has respectable knowledge in financeand accounting.
It meets once a month, in principle, and more often as deemednecessary, to receive reports concerning important audit-relatedmatters, hold discussions, and pass resolutions.
To upgrade the Company Auditors’ capabilities, ACOM estab-lished the Company Auditors’ Office and assigned persons toassist Company Auditors by providing related support. Decisionsregarding their number, appointments and transfers of such per-sons are made after consultation with the Board of CompanyAuditors in order to secure independence of these persons.
23
(c)Executive Officers
ACOM introduced an executive officer system in June 2003. TheBoard of Directors appoints executive officers, determines theirfunction, lines of responsibility and authority, and delegates exe-cution of operations to them. In these ways, decision-making andbusiness execution are expedited, while supervision and executionfunctions are clearly separated. ACOM has 11 executive officers,9 of whom are in office, and 10 of the 12 members of the Boardof Directors serve concurrently as executive officers.
(d)Executive Officers’ Meeting
The Executive Officers’ Meeting consists of executive officers whoserve concurrently as directors in office and the Director in chargeof the Internal Auditor Department. In the presence of CompanyAuditors, the Executive Officers’ Meeting discusses and makesdecisions on important matters related to the execution of busi-ness as delegated by the Board of Directors in accordance withbasic policies determined by the Board of Directors, and alsodeliberates in advance resolutions for proposal to the Board ofDirectors. The Executive Officers’ Meeting assembles three timesa month, in principle, and more as deemed necessary.
(e)Affiliated Companies Coordination Board
The Affiliated Companies Coordination Board consists of execu-tive officers who serve concurrently as directors, the Director incharge of the Internal Auditor Department and representatives ofACOM Group companies. In the presence of Company Auditors,the Affiliated Companies Coordination Board discusses impor-tant matters concerning the management of affiliated companies,and also coordinates, communicates, and reports on importantmatters pertaining to the execution of their business. The Boardmeets once a month, in principle, and more as deemed necessary.
(f)Various Committees
1) Compliance CommitteeThe Compliance Committee, appointed by the Board ofDirectors, consists of three experts from outside the Companyand two ACOM Directors. It discusses and makes recommenda-tions about the following compliance-related matters.• Items relating to formulation, revision or abolishment of the
ACOM Group Code of Ethics and Code of Conduct• Important items related to establishment and operation of com-
pliance systems
• Items relating to formulation of basic plans• Mechanisms to correct major violations, prevent their recur-
rence and make improvements• Important items related to other compliance issues
The Compliance Committee meets once two months, or sixtimes a year, in principle, and more often as necessary.
2) Director Evaluation CommitteeCompensations and bonuses for directors and executive officerswho serve concurrently as directors are subject to evaluation bythe Director Evaluation Committee, which consists of theChairman, Deputy Chairman, President, and officer in charge ofhuman resources department. The Board of Directors passes reso-lutions based on the results of such evaluations, as well as internalrules covering remuneration and bonuses for directors.
3) Risk Management CommitteeThe Risk Management Committee consists of executive officersin offices and the Director in charge of the Internal AuditorDepartment. In the presence of Company Auditors, based onauthority bestowed upon it by the Executive Officers’ Meeting,the Committee establishes ACOM’s risk management approach,formulates basic risk management plans, and discusses and makesdecisions on important items related to risk management, such asevaluations of important risks. As necessary, it participates inExecutive Officers’ Meetings and Board of Directors meetingsand makes proposals and reports. It also makes reports to theBoard of Company Auditors as necessary.
The Risk Management Committee meets once every quarter,in principle, and more as deemed necessary.
4) Financial Information Disclosure CommitteeThe Financial Information Disclosure Committee consists of execu-tive officers who serve concurrently as directors in office that are incharge of the Treasury Department, Public Relations Department,Corporate Management Department as well as the CorporatePlanning Department, and chief general managers of relevant depart-ments. In the presence of Company Auditors, based on authoritybestowed upon it by the Executive Officers’ Meeting, the Committeediscusses and makes decisions on items related to the establishment ofthe financial disclosure system in order for the disclosure of the finan-cial information to be made in accordance with the relevant laws in atimely and in an appropriate manner. In addition, the Committeeconducts prior consultations regarding the financial information tobe disclosed before the Board of Directors meeting.
The Financial Information Disclosure Committee meets onceevery quarter in principle, and more often deemed necessary.
24
(C)Coordination between the Internal Audits,
Audits by Company Auditors and Accounting Audits and Relationship between These Audits and
Internal Control Departments
(a)Internal Audits
With an auditing staff of 18 people, the Internal AuditDepartment verifies, evaluates, and recommends ways to addressproblems pertaining to compliance status, including observanceof relevant laws, internal control initiatives, and other activities ofACOM’s business execution departments. In addition to ensuringconformity with various rules, the Department obtains an accu-rate understanding of the risks facing ACOM. Based on thisunderstanding, it conducts risk approach audits to evaluate therisk management stance of each relevant entity within ACOM,and reports the results of such audits regularly to the Board ofDirectors and Company Auditors.
In addition, the Internal Audit Department conducts directaudits of affiliated companies in the ACOM Group and providesassistance to auditing staff of such affiliates, thus ensuring estab-lishment of an effective Group auditing system.
(b)Audits by Company Auditors
Based on ACOM’s auditing policies and auditing plans, CompanyAuditors attend meetings of the Board of Directors and otherimportant meetings. Through examination of ACOM’s businessand financial situation, Company Auditors audit the execution ofbusiness by directors and make appropriate and timely suggestionsand recommendations to facilitate establishment of legal compli-ance and business ethics protocols. In addition, the CompanyAuditors work together with the accounting auditors and theInternal Audit Department to ensure an accurate grasp of operat-ing status and evaluate the condition of internal control systems.
In addition, the Company Auditors form close relationshipswith Company Auditors of Group companies to facilitate thesharing of information and ensure appropriate operational behav-ior throughout the Group.
(c)Collaboration between Company Auditors and accounting auditors
Company Auditors hold regular meetings with accounting audi-tors four times a year to confirm the accounting auditor’s auditingplan for the relevant fiscal year, and receive audit reports and theoverview and results of the audit. In addition, ACOM promotes
collaboration between Company Auditors and accounting audi-tors by having opinion exchange meetings when necessary, as wellas being present at audits.
(d)Collaboration between Company Auditors and
the Internal Audit DepartmentCompany Auditors and the Internal Audit Department hold amonthly meeting on internal audit policy, audit plans, and auditresults in order to collaborate between them.
(D)Development of Risk Management System
As the management environment surrounding ACOM changes,risks to be managed are becoming more complicated and diverse.Under such a circumstance, ACOM recognizes that one of themost important tasks of the management is to enhance andstrengthen ACOM’s risk management system in order to fullyrecognize risks, maintain the health of management, and stablysecure profitability and growth.
ACOM, under the Risk Management Committee, set basicmatters concerning risk management as the Risk ManagementRegulations to clarify risks to be managed, departments and sectionsin charge of risk management, while comprehensively controllingand uniformly managing potential risks arising in execution ofoperations at the Corporate Management Department, whichcomprehensively controls risks, in order to further enhance andstrengthen ACOM’s risk management system.
In addition, with respect to risk management for informationassets, such as individual information, ACOM, in compliance withits information security management regulations, implements avariety of counter-measures, such as appropriate safety managementmeasures, against potential risks, and strives to secure informationsecurity organically and systematically by appointing informationsecurity management officers, and deciding the roles of eachorganization and each manager and employee.
25
(F)Basic Stance on Internal Control System and
the Development of Such a System
The basic policies on the construction of the internal control systemwere amended and resolved at the Board of Directors held June 18,2010, as described below:
In addition, ACOM will make efforts to periodically evaluate thestatus of improvement of the internal control system based on theaforementioned basic policies, take remedial measures as necessary,review the basic policies to respond to changes in the business environ-ment, etc. and improve the effectiveness of the internal control system.
(G)Relationship with Outside Company Auditors
ACOM has three Outside Company Auditors. Their relationship withACOM is as shown in the chart below.
The Outside Company Auditors each makes proposals at Board ofDirectors meetings based on their neutral positions. At Board of CompanyAuditors meetings, they actively make proposals on resolution items inorder to ensure appropriateness and fairness of such resolution items. Theyalso actively engage in collaborations with accounting auditors and internalaudit department to accurately understand the actual management condi-tions and evaluate the status of the internal control system.
Incidentally, ACOM does not appoint Outside Directors.ACOM, as described in section (A), “An overview of corporate gov-ernance system and the reason for employing the system,” already hasa system in which external surveillance on the management is fullyfunctional due to the implementation of audit by Outside CompanyAuditors, and for that reason maintains the current system.
(E)Corporate Governance and Internal Control System Structure
(As of June 25, 2010)
Accounting Auditors
General Meeting of Shareholders
Company Auditors’ Office
Company AuditorsBoard of Company Auditors
Compliance Committee
Affiliated Companies
Executive Officers’ Meeting
Internal Audit Department
Financial InformationDisclosure Committee
Risk ManagementCommittee
Affiliated CompaniesCoordination Board
• Strategic Risk • Reputation Risk • Personnel Risk• Legal Risk • Credit Risk • Market Risk • Liquidity Risk • Administrative Risk • Accident & Disaster Risk • Information Asset Risk
General Risk Management Department(Corporate Management Department)
Risk Management Departments (Assigned by Risk Category)Ethics Hotline
(Internal Compliance Consultation Office)
Compliance Department
Reporting
Reporting
Internal Auditing
Support & GuidanceInternal Audit & Audit Support
Instruction
External Com
pliance Consultation and Ethics O
ffice
Director Evaluation CommitteeBoard of DirectorsEvaluationProposal
Reporting
Reporting
Analysis, Support & GuidanceReporting Analysis, Support & GuidanceReporting
Instruction
Reporting
Reporting
Credit Business Promotion Division
Compliance Office
Divisions and Other Departments
Compliance Office Compliance Office
Credit Supervision Division Guarantee Business Department
Personnel with responsibilitiesfor compliance promotion
Other Departments
26
Compensation to Directors and Company Auditors
(A) Total Amount of Compensations by Categories for the Filing Company,
Total Amount of Compensations by Type, and the Number of Paid Officers
Category Total amount(Millions of Yen)
Directors (excluding Outside Directors)Company Auditors (excluding Outside Company Auditors)Outside Directors and Outside Company AuditorsTotal
Basic salary
Total amount of compensations by type(Millions of Yen)
Stock option Bonus Retirementbenefit
Number ofpersons
31922
48390
31922
48390
——
——
——
——
——
——
121
417
(Notes) 1. There is no employee-director.2. Director Kyota Omori was previously an Outside Director but was appointed as a Director effective the end of the 32nd Ordinary General Meeting of
Shareholders held on June 25, 2009. For the above reason, “Total amount” of “Directors (excluding Outside Directors)” and “Outside Directors andOutside Company Auditors” as well as “Basic salary” include compensations for the respective period of the current fiscal year. “Number of persons”represents the total number of persons holding office.
(B)Total Amount of Consolidated Compensations by
the Filing Company’s Officers
This is not listed because no officers of the filing company receive thetotal of more than 100 million yen of consolidated compensations.
(C)Policy Concerning the Decision on
the Amounts of Compensations Paid to Officers
ACOM has no policy concerning the decision on the amounts ofcompensations paid to officers.
Name of Outside Company Auditor
Satoshi Ito
Minoru Ikeda
Norikatsu Takahashi
Relations with the Company
• Holds 100 shares of the Company’s Stock. There is no other specific interests in the Company• With his years of experience in a life insurance company, he is judged as being capable of monitoring corporate manage-
ment from objective and neutral point of view with respectable insight based on his experience in the different indus-tries. Therefore, the Company believes that he can contribute to further enhancement of audit system and corporategovernance.
• No special interests in the Company• With the years experience of being involved in research and analysis relating to economic policies and trends, he is
judged as being capable of monitoring corporate management from objective and neutral point of view with respectableinsight concerning overall national economy. Therefore, the Company believes that he can contribute to furtherenhancement of audit system and corporate governance.
• No special interests in the Company• Although he has experience of working at Mitsubishi Trust and Banking Corporation (current Mitsubishi UFJ Trust
and Banking Corporation), which is the Company’s fellow subsidiary and major business partner, as an employee fromApril 1966 to December 1968, since April 1971, he has been working independently as an attorney-at-law specializingin corporate legal practices and general civil cases. Therefore, it is judged that there is no potential conflict of interestwith general shareholders and he has been designated as the independent director/corporate auditor. Moreover, beingan attorney-at-law, he is judged capable of monitoring corporate management from legal point of view based on hisrespectable insight into laws and regulations and neutral and proper standpoint. Therefore, the Company believes thathe can contribute to further enhancement of audit system and corporate governance.
* The Company has concluded a limited liability agreement with each Outside Company Auditor, which limits the liability under Article 423, Paragraph 1 of the Companies Act to theextent of the amount stipulated in the law.
27
Purchase of Treasury Stock
Pursuant to Article 165, Paragraph 2 of the Companies Act,ACOM has included in its Articles of Incorporation a clauseallowing purchase of its own shares via the market, subject to aresolution of the Board of Directors. Such inclusion was made topermit flexible share buybacks according to ACOM’s businessand financial conditions and other circumstances.
Limited Liability Agreement
ACOM has signed agreements to limit liability under Article 425,Paragraph 1 of the Companies Act with Outside CompanyAuditors. The limited liability amount based on such agreementis the minimum liability amount determined in the law.
Membership of the Board of Directors
The Articles of Incorporation stipulates the Board of Directorsconsist of 12 members or less.
Resolution Requirement for Election of Directors
The Articles of Incorporation stipulates that voting on resolutionsfor election of directors shall take place under the presence ofshareholders who represent one-third or more of total votingrights, and the majority of the votes of those shareholders andthose which are not contingent upon cumulative votes shall bethe requisite for adoption of the resolution.
Liability Exemption for Directors and Company Auditors
To ensure that directors and Company Auditors can adequately carryout the duties they are entrusted with, as pursuant Article 426,Paragraph 1 of the Companies Act, a provision has been included in theArticles of Incorporation to allow the exemption of Directors (includingformer Directors) and Company Auditors (including former CompanyAuditors), by decision of the Board of Directors and within the limitsallowed by the law, from liability resulting from dereliction of duty.
Special Resolutions at the General Meeting of Shareholders
For purpose of maintaining smooth operation of the GeneralMeeting of Shareholders, the Articles of Incorporation stipulatesthat special resolutions as pursuant Article 309, Paragraph 2 ofthe Companies Act, shall be passed if at least two thirds of voting
rights are cast in favor, if shareholders representing at least onethird of eligible votes are present.
ACOM’s Position and its Relationship within the Group of the Parent Company
Under a business and capital alliance with MUFG and its subsidiary,BTMU, ACOM serves as the core company for the MUFGGroup’s consumer finance business.
In addition, under a contract relating to corporate management,ACOM engages in consultations and makes reports to MUFGconcerning important corporate matters. Nevertheless, while deci-sions on matters such as management policy and business strategyreflect the corporate management policy of the parent company,these decisions are based on ACOM’s own judgments, and as sucha certain level of independence as a listed company is ensured.
Guidelines for the Protection of Minority Shareholders in Transactions with Controlling Shareholders
Although ACOM engages in transactions with MUFG Group’scompanies, which include borrowing funds and guaranteeingunsecured card loans, the fairness of these transactions is ensuredbecause they are based on our code of conduct of adhering to fairmarket rules and proper commercial practices. And like transac-tions with unrelated companies, they are based on impartial judg-ments made in accordance with internal rules, etc.
Status of Securities Held by ACOM
(A) Regarding investment securities held for other than pure investment purposes, the number of stock names and total value recorded in the balance sheet.
Not applicable.
(B) Regarding individual investment securities held for other thanpure investment purposes, name, the number of shares, valuerecorded in the balance sheet total, and purpose of holding.
Not applicable.
28
Details of Compensation for Auditors
(A) Details of Compensation for Certified Public Accountants
Classification
The CompanyConsolidated subsidiaryTotal
Compensation in accordance toaudit certification
(Thousands of Yen)
Prior fiscal year Current fiscal year
Compensation in accordance tononaudit certification(Thousands of Yen)
Compensation in accordance toaudit certification
(Thousands of Yen)
Compensation in accordance tononaudit certification(Thousands of Yen)
109,52521,000
130,525
—4,2004,200
101,40021,000
122,400
—900900
(B) Other Important Details Concerning Remuneration
Not applicable.
(C) Details of Non-Audit Work Against
the Filing Company by Certified Public Accountants
Not applicable.
(D) Policies Concerning Auditing Remuneration
Not applicable.
(C) Regarding investment securities held for pure investment purposes, total value recorded in the balance sheet, total dividend received,total gain or loss on sale, and total valuation gain or loss in the previous and current fiscal years.
(D) Regarding individual investment securities, of which holding pur-pose has been changed from pure investment to other than pureinvestment, name, the number of shares and value recorded in thebalance sheet.
Not applicable.
(E) Regarding individual investment securities, of which holding pur-pose has been changed from other than pure investment to pureinvestment, name, the number of shares and value recorded in thebalance sheet.
Not applicable.
Previous fiscal year(Thousand Yen)
Total value inbalance sheet
Non-listed securitiesSecurities other than the above
Total value inbalance sheet
Current fiscal year(Thousand Yen)
Total dividendreceived
Total gain orloss on sale
Total valuationgain or loss
——
2,133,17516,359,230
149,570192,694
531,83526,050
(Note)(98,078)
(Note) Total amount of valuation gain or loss is not shown for non-listed securities, since it is extremely difficult to obtain the market value of such securities.
29
Social Contribution
ACOM’s Social Contribution Activity Policy
Guided by the basic principle of the “Circle of Trust” spirit onwhich it was founded, the ACOM Group embraces a corporatephilosophy emphasizing contribution to improved culturallifestyles. In line with this philosophy, ACOM aims to build goodrelations with society and be “the Company next door” and a“corporate citizen in harmony with society” through its widerange of social contribution activities, including social welfare andcommunity contribution.
Environmental Protection Activities
ACOM has acquired trust beneficiary rights to emission creditsfrom Mitsubishi UFJ Trust and Banking Corporation under aproject sanctioned by the United Nations to reduce greenhousegases. Consequently, we became the first company in Japan’s con-sumer finance industry to offset greenhouse gas emissions pro-duced by our “Miru Concert Monogatari” concerts, as well as ourhead office building and other locations. We are offsetting around1,000 tons of carbon emissions annually over a five-year periodunder the arrangement, which started in fiscal 2008. Under thearrangement, ACOM also donates the acquired emission creditsto the Japanese government.
Culture and Arts
Reflecting its philosophy emphasizing contribution to improvedcultural lifestyles, ACOM is actively engaged in supporting cul-
tural and artistic events. Our most prominent initiatives in thisarea are our “Miru Concert Monogatari” performances held regu-larly throughout Japan. Preparation and support for these concertsis provided entirely not only by ACOM employees, but also cit-izens and other volunteers from local authorities in the regionswhere the concerts are held. To maximize the enjoyment of allvisitors, we have organized these concerts as “barrier-free”events, providing onstage sign language interpretation and seat-ing spaces reserved for wheelchair users. The stated aims of theconcerts are to “do something for people,” “see many people’ssmiling faces,” and “build close relationships with local commu-nities.” Since the first event in 1994, we have held more than140 such concerts, bringing the cumulative total of audiences tomore than 130,000 people.
Social Welfare
As part of its “Circle of Trust” commitment, ACOM providessupport for volunteer activities by employees. The ACOMBluebird Fund was set up in 1984 at the suggestion of employeesand continues today. Collection boxes are placed in each work-place, and contributions are donated to social welfare groups andrelief funds to help people in disaster-stricken areas.
Regional Promotional Support Activities
In addition to sponsoring various cultural and sporting events,ACOM engages in local cleanup campaigns and other grass-rootsactivities through affiliated groups.
“Miru Concert Monogatari”“ACOM Bluebird Fund Collection Box”
30
History of Creativity and Innovation
Carrying on the spirit of its founder, ACOM joins the MUFG Group
Evolution of ACOM’s Creative and Innovative Management >
1970/5Developed the First Automatic
Cash Dispenser in Japan
1960/3Started “Salary-Man Loan”
Subsequently, ACOM’s businessexpanded dramatically in the wake ofhigh-level economic growth. In 1970,as automatic vending machines quick-ly spread, we developed Japan’s firstautomatic cash dispenser, essentiallyan automatic vending machine thatproduced ¥20,000 in an envelopewhen the customer inserted a card.
In the 1960s, Japan entered an era ofmass production and mass consump-tion. At that time, the founders ofACOM, aware of the need to mod-ernize the so-called “people’s finance”industry, took up the challenges ofproviding “salary-man finance” (provi-sion of credit to salaried workers) viaunsecured and unguaranteed loanswhich was not part of Japan’s financialsystem at the time.
1936/4 Started Wholesale and Retail Textile Business
ACOM was founded in 1936 as awholesale and retail textile businessunder the name “Maruito GofukuTen.” Our subsequent history of morethan 70 years has been based on thespirit of reciprocal trust-trusting peo-ple and being trusted by people.
31
ACOM was founded in 1936 as a wholesale and retail textile business under the name “Maruito Gofuku Ten.” Atthe time, the Company’s trading philosophy was based on “trusting people,” which resonated with many peopleand received warm acclaim, leading to significant prosperity. In those days, companies did not provide financebased on trust of individuals. However, our founding spirit remained with us through our later entry into theconsumer finance business. Our subsequent history of more than 70 years has been based on the spirit of recipro-cal trust—trusting people and being trusted by people.
With a rich history of “creativity and innovation,” we have evolved from a textile trader to a leading companyin the consumer finance sector. Today, ACOM is the core consumer finance company in the MUFG Group.
2004/3Formed an alliance with MTFG
1996/9Entered the Thai market
ACOM’s business development is basedon its belief of constant change and itssuccess in addressing changing condi-tions, changing markets, and changingcustomer needs. In March 2004, weformed a strategic business and capitalalliance with the Mitsubishi TokyoFinancial Group, Inc. (MTFG) (currently,“MUFG”). In December 2008, thebusiness and capital alliance was furtherstrengthened, with ACOM becoming aconsolidated subsidiary of MUFG.
Targeting further growth, in 1996ACOM entered the Thai market inconjunction with its globalization ini-tiative. In 1999, we were the first inthe industry to launch a credit cardbusiness.
1993/7Installed “MUJINKUN,”
automatic contract machine
In 1979, we installed the first 24-hour, 365-day ATM in the domesticconsumer finance industry. Sincethen, in 1993 we led the industry indeveloping an automatic contractmachine, called “MUJINKUN.”These innovations helped to tap intolatent customer demand, providing adriving force for the advancement ofthe entire industry.
32
Board of DirectorsAs of June 24, 2010
Directors
Deputy Chairman
Yuji OhashiSupporting Conspectus of Corporate
ManagementInternal Audit Department
Chairman and President
Shigeyoshi KinoshitaConspectus of Corporate Management
Senior Managing Director
Shigeru Akaki
Managing Director
Satoru Tomimatsu
Kiyoshi Tachiki
Shozo Tanaka
Shigeru Sato
Masahiko Shinshita
Tatsuo Taki
Director
Kyota Omori
Company Auditors
Tatsuaki Murata
Satoshi Ito (Outside)
Minoru Ikeda (Outside)
Norikatsu Takahashi (Outside)
Executive Officers
Chief Executive Officer
Shigeyoshi KinoshitaSupervisor of All Business ExecutionChairman of Risk Management Committee
Senior Executive Managing Officer
Shigeru AkakiSystem Development &
Administration DepartmentGeneral Affairs Department
Executive Managing Officer
Satoru TomimatsuHead of Credit Business Promotion DivisionCredit Marketing DepartmentEast Japan DivisionWest Japan DivisionCredit Business Management DepartmentCompliance for Credit Business Promotion Office
Kiyoshi TachikiCorporate Planning DepartmentBusiness Process Planning DepartmentPublic Relations Department
Shozo TanakaHead of Credit Supervision DivisionCredit Supervision Department ICredit Supervision Department IICompliance for Credit Supervision Office
Shigeru SatoChairman of Financial Information
Disclosure CommitteeTreasury DepartmentHuman Resources Department
Masahiko ShinshitaOverseas Business Development
DepartmentGuarantee Business DepartmentChief General Manager of
Overseas Business Development Department
Tatsuo TakiCustomer Relations DepartmentCompliance DepartmentCorporate Management Department
Executive Officer
Etsuro TabuchiPublic Relations
Kazuo FukumotoChief General Manager of
Corporate Planning Department
Teruyuki SagehashiChief General Manager of
System Development & Administration Department
ACOM in FIGURES
34Related Macroeconomic Data
36Operating Revenue, Receivables Outstanding, and Number ofCustomer Accounts by Segment (Consolidated)
40Six-Year Financial Summary (Consolidated)
42Seven-Year Financial Summary (Non-Consolidated)
44Other Business and Financial Data (Non-Consolidated)
58Investor Information
33
34
The Number of Unemployed People (Millions) *1 . . . .Unemployment Rate (%) *1 . . . . . . . . . . . . . . . . . . . . .Personal Bankruptcy Applications *2 . . . . . . . . . . . . . .
1. Employment-Related Statistics *1
Unemployment Rate (%) . . . . . . . . . . . . . . . . . . . . . . . . .The Ratio of Job Offers to Job Seekers (Times) . . . . . . . .The Total Cash Wage Amount (yoy %) . . . . . . . . . . . . . .Regular Employment Index (yoy %) . . . . . . . . . . . . . . . . .
2. Consumption-Related StatisticsConsumer Spending (yoy %) *2 . . . . . . . . . . . . . . . . . . . .Retail Sales (yoy %) *3 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. Financial-Related Statistics, etc. *1
Ten-year Government Bond Yield (%) . . . . . . . . . . . . . . .Nikkei 225 (Yen) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Related Macroeconomic Data (Yearly)
5.10.69-0.9-0.3
-0.20.7
1.43511,715
4.60.86-0.30.7
-0.50.3
1.32011,668
4.40.980.70.1
-0.61.2
1.77017,059
2004/3 2006/3
4.11.060.10.9
-1.6-0.1
1.65017,287
2007/32005/3
2.704.4
11,847
2.774.2
7,533
2.994.4
9,811
3.354.8
11,241
3.465.0
11,475
3.475.1
9,371
Related Macroeconomic Data (Monthly)
2008 2009
December January February March April May
Source: 1. Nihon Keizai Shimbun, Inc.2. Ministry of Internal Affairs and Communications 3. Ministry of Economy, Trade and Industry
Source: 1. Ministry of Internal Affairs and Communications 2. Supreme Court of Japan
35
4.10.77-1.11.2
-2.9-1.1
1.3408,109
3.81.02-0.7 1.8
0.80.5
1.27512,525
2008/3 2009/3
5.20.45-3.30.0
1.1-0.4
1.395 11,089
2010/3
3.485.3
11,743
3.595.6
11,813
3.615.4
9,922
3.635.3
10,228
3.445.2
11,195
3.315.3
10,112
3.175.2
11,821
3.234.9
7,601
3.244.9
9,695
3.505.0
11,833
2010
June July August September October November December January February March
36
Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . .Loan Business . . . . . . . . . . . . . . . . . . . . . . . . . .
ACOM CO., LTD. . . . . . . . . . . . . . . . . . .DC Cash One Ltd. *1 . . . . . . . . . . . . . . . . .EASY BUY Public Company Limited . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . .
Credit Card Business . . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . .
Installment Sales Finance Business . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . .EASY BUY Public Company Limited . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . .
Guarantee Business . . . . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . .DC Cash One Ltd. *1 . . . . . . . . . . . . . . . . .
Loan Servicing Business . . . . . . . . . . . . . . . . . .Collection of purchased receivables . . . . . . .
Rental Business . . . . . . . . . . . . . . . . . . . . . . . . .Others . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Financial Businesses . . . . . . . . . . . . .Banking Business *3 . . . . . . . . . . . . . . . . . . . . .
379,706331,476298,88713,71918,869
—5,4375,367
697,682
—4,2813,401
10,5657,5323,033
17,02615,5684,6002,917
993—
-10.4 -11.5 -14.2
3.8 46.8
—-11.3 -11.3 -7.1
-24.0 —
-15.6 178.2 14.3 6.5
39.6 23.1 16.8 2.5
-44.6 -61.5
—
2008/3
yoy %
Millions of Yen
445,431396,485374,23311,35410,895
06,4626,389
7214,8395,8026,7622,2756,6516,244
40614,11713,3224,3182,557
331—
2.6 2.4
-1.3 —
34.6 -77.5
2.4 2.6
-14.0 -10.7 -38.6 139.2 -47.6 -12.8 -18.1
—61.1 71.7 14.2
-27.2 676.0
—
Operating Revenue by Segment (Consolidated)
2006/3
yoy %
-4.9 -5.5 -6.9 16.4 17.9
-76.8 -5.2 -5.3 3.2
-31.9 -34.3 -25.0 -46.3 39.0 13.2
434.7 -2.1 0.0 4.0
105.9 679.8
—
2007/3
yoy %
423,652374,590348,51913,22012,850
06,1286,054
7410,1063,8115,0721,2229,2447,0712,172
13,82713,3284,4895,2652,581
—
Notes: 1. ACOM obtained all the stocks of DC Cash One Ltd., previously a consolidated subsidiary of ACOM, and DC Cash One Ltd. became a wholly owned subsidiary ofACOM as of April 1, 2009. DC Cash One Ltd. was merged into ACOM as of May 1, 2009.
2. AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007. 3. ACOM CO., LTD. made PT. Bank Nusantara Parahyangan, Tbk. a consolidated subsidiary on December 17, 2007.
37
Millions of Yen
yoy %
2009/3
324,396277,628244,63713,21919,770
—4,6904,649
414,989
—1,9723,016
11,6298,3623,267
16,44615,7643,4362,1831,1273,390
-14.6-16.2-18.2-3.64.8—
-13.7-13.4-40.0-35.1
—-53.9-11.310.111.07.7
-3.41.3
-25.3-25.113.4
—
70,57362,74957,2141,0634,470
—1,0571,050
61,029
—239789
2,1462,146
—2,6502,512
—5452
886
141,722124,337113,718
1,0639,555
—2,0752,063
112,065
—459
1,6055,2515,251
—6,1185,835
—5854
1,815
212,433183,878168,442
1,06314,372
—3,0573,042
143,064
—646
2,4179,6819,681
—9,9589,546
—8175
2,711
278,795240,041219,620
1,06319,357
—3,9673,949
174,002
—815
3,18614,29514,295
—12,84412,273
—9788
3,547
-14.1-13.5-10.2-92.0-2.1
—-15.4-15.1-57.6-19.8
—-58.7
5.622.971.0
—-21.9-22.1
—-95.5-92.2
4.6
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
243,900204,300182,700
—21,600
—3,1003,100
—3,200
—300
2,90020,20020,200
—8,200
——
500500
4,400
2011/3(E)
yoy %
-12.5-14.9-16.8
—11.6
—-21.9-21.5
—-20.0
—-63.2-9.041.341.3
—-36.2
——
415.5468.224.0
38
Loan Business *1 . . . . . . . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . . .EASY BUY Public Company Limited . . . . . .DC Cash One Ltd. *3 . . . . . . . . . . . . . . . . . .
Credit Card Business *4 . . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . . .
Installment Sales Finance Business *5 . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *2 . . . . . . . . .EASY BUY Public Company Limited . . . . . .
Loan Servicing Business *6 . . . . . . . . . . . . . . . . . .Banking Business *7 . . . . . . . . . . . . . . . . . . . . . . .
Receivables Outstanding . . . . . . . . . . . . . . . . . . .Loan Business . . . . . . . . . . . . . . . . . . . . . . . . .
ACOM CO., LTD. . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *1 . . . . . . .EASY BUY Public Company Limited . . .DC Cash One Ltd. *2 . . . . . . . . . . . . . . . .
Credit Card Business . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *1 . . . . . . .
Installment Sales Finance Business . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . .AFRESH CREDIT CO., LTD. *1 . . . . . . .EASY BUY Public Company Limited . . .
Loan Servicing Business . . . . . . . . . . . . . . . . .Banking Business *3 . . . . . . . . . . . . . . . . . . . .
Guaranteed Receivables . . . . . . . . . . . . . . . . . . . .ACOM CO., LTD. . . . . . . . . . . . . . . . . . . .DC Cash One Ltd. *2 . . . . . . . . . . . . . . . . . .
Notes: 1. Loan Business: Number of customer accounts with outstanding that includes non-interest bearing balance.2. AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007.3. ACOM obtained all the stocks of DC Cash One Ltd., previously a consolidated subsidiary of ACOM, and DC Cash One Ltd. became a wholly owned subsidiary of
ACOM as of April 1, 2009. DC Cash One Ltd. was merged into ACOM as of May 1, 2009.4. Credit Card Business: Number of cardholders.5. Installment Sales Finance Business: Number of contracts with receivables outstanding.6. Loan Servicing Business: Number of accounts for purchased loans.7. ACOM CO., LTD. made PT. Bank Nusantara Parahyangan, Tbk. a consolidated subsidiary on December 17, 2007.
1,759,9271,632,3101,494,399
—49,91882,69844,84244,268
56656,98632,1479,503
15,33525,788
—105,97796,8509,126
-5.0 -4.2 -6.4
—68.8 11.5 -6.8 -6.9 -0.4
-31.6 -29.8 -45.2 -24.2 48.0
—17.9 8.0 —
2007/3
yoy %
Millions of Yen
Receivables Outstanding by Segment (Consolidated)
1,852,0531,703,1721,596,276
2029,56474,14248,12047,537
56883,33545,76917,33520,22917,423
—89,89489,639
254
-0.9 1.4
-0.3 -38.7 72.3 25.1 -2.6 -2.7 4.1
-34.6 -34.6 -48.4 -14.8 36.9
—15.2 14.9
—
2006/3
yoy %
3,435,5862,682,160
—556,344182,878
1,181,8061,175,910
5,701421,554147,43357,840
216,281226,271
—
-0.4 -6.2
—35.6 6.2
-6.2 -6.2 -0.1
-37.2 -28.4 -39.8 -41.5 12.8
—
2007/3
yoy %
Number of Customer Accounts by Segment (Consolidated)
3,450,6362,859,176
40410,142172,183
1,259,5091,253,603
5,709671,742205,78396,023
369,936200,662
—
1.3 -1.5
-76.0 18.2 14.7 5.2 5.2 1.8
-29.9 -27.7 -35.1 -29.7 45.6
—
2006/3
yoy % yoy %
2008/3
3,208,8722,374,759
—638,291180,085871,773866,958
4,814313,664
—159,260154,404227,587
4,001
-6.6 -11.5
—14.7 -1.5
-26.2 -26.3 -15.6 -25.6
—175.3 -28.6
0.6 —
yoy %
2008/3
1,612,5561,480,9171,318,781
—74,73581,16138,12637,682
44342,795
—32,65610,13830,63820,078
120,639100,63320,005
-8.4 -9.3
-11.8 —
49.7 -1.9
-15.0 -14.9 -21.6 -24.9
—243.6 -33.9 18.8
—13.8 3.9
119.2
Notes: 1. AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007. 2. ACOM obtained all the stocks of DC Cash One Ltd., previously a consolidated subsidiary of ACOM, and DC Cash One Ltd. became a wholly owned subsidiary of ACOM
as of April 1, 2009. DC Cash One Ltd. was merged into ACOM as of May 1, 2009.3. ACOM CO., LTD. made PT. Bank Nusantara Parahyangan, Tbk. a consolidated subsidiary on December 17, 2007.
39
Millions of Yen
yoy %
2009/3
3,126,9162,135,224
—796,305177,379582,823580,134
2,689220,182
—145,44674,736
255,9344,119
-2.6 -10.1
—24.8 -1.5
-33.1 -33.1 -44.1 -29.8
—-8.7
-51.6 12.5 2.9
3,070,5792,254,285
—800,177
—525,226523,023
2,203208,121
—144,52563,596
283,5034,087
2,999,6032,170,800
—815,801
—467,700465,956
1,744206,275
—150,00956,266
289,8964,275
2,837,4281,996,255
—831,289
—415,133413,774
1,359199,798
—149,13950,659
292,3884,488
2,720,5111,948,949
—762,657
—374,532373,513
1,019188,922
—143,52345,399
293,6364,516
-13.0 -8.7
—-4.2
—-35.7 -35.6 -62.1 -14.2
—-1.3
-39.3 14.7 9.6
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
2,580,8001,792,200
—788,600
—222,200222,000
200165,700
—132,10033,600
——
-5.1 -8.0
—3.4 —
-40.7 -40.6 -80.4 -12.3
—-8.0
-26.0 ——
2011/3(E)
yoy %
yoy %
2009/3
1,423,1971,316,1661,171,893
—58,68878,13832,44632,228
21835,580
—32,6812,899
20,92318,081
144,351115,72328,628
-11.7 -11.1 -11.1
—-21.5 -3.7
-14.9 -14.5 -50.9 -16.9
—0.1
-71.4 -31.7 -9.9 19.7 15.0 43.1
1,387,8921,282,6611,212,596
—63,640
—31,00830,839
16836,216
—33,6842,531
19,65818,347
118,777118,777
—
1,351,3651,248,0141,176,080
—67,092
—29,46829,341
12735,049
—32,8342,215
18,35320,479
313,536313,536
—
1,301,9781,204,4361,136,652
—64,564
—27,93227,839
9334,057
—32,2201,836
15,75919,791
312,217312,217
—
1,272,5921,173,5451,103,969
—66,889
—26,55426,485
6831,850
—30,2191,631
15,31025,331
317,240317,240
—
-10.6 -10.8 -5.8
—14.0
—-18.2 -17.8 -68.6 -10.5
—-7.5
-43.7 -26.8 40.1
119.8 174.1
—
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
1,108,7001,016,700
943,600—
73,100—
20,00020,000
—29,000
—27,8001,200
12,20030,800
355,800355,800
—
-12.9 -13.4 -14.5
—9.3 —
-24.7 -24.5
—-8.9
—-8.0
-26.4 -20.3 21.612.2 12.2
—
2011/3(E)
yoy %
40
1. For the Year:Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision of Allowance for Doubtful Accounts *1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Provision for Loss on Interest Repayment *2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. At Year-end:Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Receivables Outstanding *3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Total Amount of Non-performing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loans to Borrowers in Bankruptcy or Under Reorganization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Loans in Arrears . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Loans Past Due for Three Months or More . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Restructured Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Interest-bearing Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. Per Shares:Net Income, Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cash Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4. Key Financial Ratios:Operating Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROE *5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROA *5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes: 1. The amount of provision of allowance for doubtful accounts is the sum of bad debts expenses, increase or decrease in allowance for accounts receivable-operating loans, and increase ordecrease in provision for loss on guarantees. In addition, the amount of provision of allowance for doubtful account includes loss on sales of accounts receivable-operating loans fromthe fiscal year ended March 31, 2009.
2. Provision for loss on interest repayment represents the sum of interest repayment, ACOM’s voluntary waiver of repayments accompanied with interest repayment, and the increase or decrease in provision for loss on interest repayment.
3. Receivables outstanding indicates the total amount of Loan Business, Credit Card Business and Installment Sales Finance Business.4. From FY2006, total shareholders’ equity is being shown as net assets.5. ROE and ROA are calculated using the simple average of beginning and end of term balance sheet figures.
2005
Millions of Yen
433,965289,604108,453
—144,36181,533
2,077,3341,856,962
83,9618,906
37,0771,781
36,196130,532863,760
1,128,226
516.235,456.39
100.00
33.310.43.9
Six-Year Financial Summary (Consolidated)Years ended March 31
Yen
%
41
Millions of Yen
2010200820072006
445,431335,039117,12537,228
110,39265,595
2,106,6811,834,629
114,3717,707
49,9041,995
54,764131,620927,722
1,064,585
416.695,901.69
140.00
24.87.33.1
423,652508,755137,595200,147-85,102
-437,972
2,031,8291,734,139
149,4537,050
86,3681,645
54,388128,798457,165
1,031,394
-2,786.192,863.16
100.00
-20.1-63.6-21.2
379,706 298,054 115,848 19,620 81,651 35,406
1,861,505 1,561,839
136,396 5,806
81,511 3,426
45,652 119,882 472,144 932,474
225.24 2,950.01
100.00
21.5 7.7 1.8
278,795 272,732 89,654 58,362 6,063
-7,239
1,482,520 1,231,949
116,694 3,112
63,666 3,392
46,522 70,449
439,269 762,568
-46.182,773.59
10.00
2.2-1.6-0.5
2009
324,396293,66687,89952,15730,72913,662
1,605,5671,384,193
128,2234,405
80,4252,811
40,58093,037
452,406809,215
86.912,831.36
70.00
9.53.00.8
Yen
%
42
1. For the Year:Operating Revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Operating Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Provision of Allowance for Doubtful Accounts *1 . . . . . . . . . . . . . . . . . . . . . . . . . . . .Provision for Loss on Interest Repayment *2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2. At Year-end:Total Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Receivables Outstanding *3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Total Amount of Non-performing Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Loans to Borrowers in Bankruptcy or Under Reorganization . . . . . . . . . . . . . . . . . . .Loans in Arrears . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Loans Past Due for Three Months or More . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Restructured Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Interest-bearing Debts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3. Per Shares:Net Income, Basic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Net Assets *4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Cash Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4. Key Financial Ratios:Operating Margin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROE *5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ROA *5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Ratio of Bad Debt Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Non-performing Loans Ratio (Gross basis) *6 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Non-performing Loans Ratio (Net basis) *7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes: 1. The amount of provision of allowance for doubtful accounts is the sum of bad debts expenses, increase or decrease in allowance for accounts receivable-operating loans, and increase ordecrease in provision for loss on guarantees. In addition, the amount of provision of allowance for doubtful account includes loss on sales of accounts receivable-operating loans fromthe fiscal year ended March 31, 2009.
2. Provision for loss on interest repayment represents the sum of interest repayment, ACOM’s voluntary waiver of repayments accompanied with interest repayment, and the increase or decrease in provision for loss on interest repayment.
3. Receivables outstanding indicates the sum of receivables outstanding of the loan business, credit card business, and installment sales finance business.4. From FY2006, total shareholders’ equity is being shown as net assets.5. ROE and ROA are calculated using the simple average of beginning and end of term balance sheet figures.6. Non-performing loans ratio (Gross basis) = Total amount of non-performing loans / loans receivables plus loans to borrowers in bankruptcy or under reorganization.7. Non-performing loans ratio (Net basis) = (Non-performing loans -allowance for doubtful accounts) / loans receivables plus loans to borrowers in bankruptcy or under reorganization.
20052004
Millions of Yen
Yen
%
411,799295,918135,474
—115,88065,648
2,019,6481,772,706
79,7549,280
36,6321,638
32,204129,400694,082
1,260,090
455.364,834.50
80.00
28.19.83.26.44.9
-3.1
402,734262,500102,462
—140,23483,001
1,951,6251,720,641
81,2108,377
35,3101,345
36,177122,400862,301
1,028,722
525.535,447.18
100.00
34.810.74.26.15.1
-2.6
Seven-Year Financial Summary (Non-Consolidated)Years ended March 31
43
Millions of Yen
Yen
2010200820072006 2009
%
262,120235,22376,27652,15726,89616,928
1,423,1871,204,121
116,1323,409
72,841935
38,94584,000
440,398680,734
107.692,801.62
70.00
10.33.81.1
11.69.92.7
396,637290,512108,18337,227
106,12464,152
1,961,4621,689,598
109,5737,000
46,7091,110
54,752122,700923,408945,208
407.525,874.25
140.00
26.87.23.36.06.9
-0.8
370,769459,762129,056200,147-88,992
-439,463
1,861,2851,570,823
141,3076,120
80,976499
53,711121,000443,797888,587
-2,795.682,823.24
100.00
-24.0-64.3-23.0
8.49.41.4
317,116236,956100,76019,62080,15933,518
1,620,4681,356,464
124,7674,824
75,690727
43,524108,500451,321774,407
213.232,871.10
100.00
25.3 7.5 1.9
11.8 9.41.2
238,215232,52675,05858,3625,689
-10,056
1,368,0281,130,454
109,1342,767
61,0601,443
43,86361,700
426,597705,387
-64.152,723.05
10.00
2.4-2.3-0.711.79.94.3
44
Loan Business *1 . . . . . . . . . . . . . . . . . . . .Unsecured Loans . . . . . . . . . . . . . . . . .
Consumers . . . . . . . . . . . . . . . . . .Commercials . . . . . . . . . . . . . . . . .
Secured Loans . . . . . . . . . . . . . . . . . . .Credit Card Business *2 . . . . . . . . . . . . . .
MasterCard® . . . . . . . . . . . . . . . . . . . .Installment Sales Finance Business *3, 4 . . .
Receivables Outstanding . . . . . . . . . . . . .Loan Business . . . . . . . . . . . . . . . . . . .
Unsecured Loans . . . . . . . . . . . . . .Consumers . . . . . . . . . . . . . . . .Commercials . . . . . . . . . . . . . .
Secured Loans . . . . . . . . . . . . . . . .Real Estate Card Loan . . . . . . .
Credit Card Business . . . . . . . . . . . . . .MasterCard® . . . . . . . . . . . . . . . . . .
Installment Sales Finance Business * . .Average Balance of Unsecured Loans for Consumers per Account (Thousands of Yen) . . . . . .
<Reference>Guaranteed Receivables . . . . . . . . . . . . . .
Notes: 1. Loan Business: Number of loan accounts with loans receivable.2. Credit Card Business: Number of cardholders.3. Installment Sales Finance Business: Number of contracts with receivables outstanding.4. AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007.
yoy %
2008/3
1,356,4641,318,7811,277,9441,277,879
6440,83735,50037,68337,682
—
540
181,795
-13.6 -11.8 -11.6 -11.6 -29.5 -15.3 -15.2 -14.9 -14.9
—
-0.2
1.3
1,570,8231,494,3991,446,2091,446,117
9148,19041,87744,27644,26832,147
541
179,549
-7.0 -6.4 -6.2 -6.2
-32.3 -10.8 -9.4 -6.9 -6.9
-29.8
-0.2
9.6
2007/3
yoy %
Millions of Yen
Receivables Outstanding (Non-Consolidated)
yoy %
2008/3
2,374,7592,364,7272,364,664
6310,032
866,958866,958
—
-11.5 -11.5 -11.5 -37.6 -12.4 -26.3 -26.3
—
yoy %
2009/3
1,204,1221,171,8931,137,1461,137,099
4634,74729,97432,22832,228
—
535
193,862
-11.2 -11.1 -11.0 -11.0 -27.7 -14.9 -15.6 -14.5 -14.5
—
-0.9
6.6
yoy %
2009/3
2,135,2242,126,3962,126,348
488,828
580,134580,134
—
-10.1 -10.1 -10.1 -23.8 -12.0 -33.1 -33.1
—
2,682,1602,670,7072,670,606
10111,453
1,176,1051,175,910
147,433
-6.2 -6.2 -6.2
-34.0 -7.5 -6.2 -6.2
-28.4
2007/3
yoy %
Number of Customer Accounts (Non-Consolidated)
Note: AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007.
45
Millions of Yen
1,243,4351,212,5961,179,3301,179,287
4333,26528,71230,83930,839
—
525
118,777
1,205,4211,176,0801,144,1721,144,130
4131,90727,55829,34129,341
—
529
313,536
1,164,4921,136,6521,106,2831,106,244
3930,36926,19827,83927,839
—
556
312,217
1,130,4551,103,9691,074,9331,074,894
3829,03625,05626,48526,485
—
554
317,240
-6.1 -5.8 -5.5 -5.5
-16.4 -16.4 -16.4 -17.8 -17.8
—
3.6
63.6
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
-5.8 -5.5 -5.1 -5.1
-17.5 -15.7 -15.9 -16.9 -16.9
—
3.9
63.2
-5.6 -5.3 -5.0 -5.0
-16.1 -15.0 -15.1 -16.0 -16.0
—
-1.7
65.2
-5.5 -5.2 -4.9 -4.9
-20.8 -14.7 -15.1 -15.0 -15.0
—
-2.6
-35.6
yoy % yoy % yoy %
963,600943,600922,500922,500
—21,100
—20,00020,000
—
516
355,800
-14.8-14.5-14.2-14.2
—-27.3
—-24.5-24.5
—
-6.9
12.2
2011/3(E)
yoy %
2,254,2852,245,7422,245,699
438,543
523,023523,023
—
2,170,8002,162,5552,162,517
388,245
465,956465,956
—
1,996,2551,988,3641,988,332
327,891
413,774413,774
—
1,948,9491,941,3331,941,301
327,616
373,513373,513
—
-8.7 -8.7 -8.7
-33.3 -13.7 -35.6 -35.6
—
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
-8.8 -8.8 -8.8
-34.7 -13.3 -35.0 -35.0
—
-3.4 -3.3 -3.3
-25.5 -12.3 -33.4 -33.4
—
-2.4 -2.4 -2.4
-23.2 -11.9 -33.6 -33.6
—
yoy % yoy % yoy %
1,792,2001,786,0001,786,000
—6,200
222,000222,000
—
-8.0 -8.0 -8.0
—-18.6 -40.6 -40.6
—
2011/3(E)
yoy %
46
Number of New Loan Customers . . . . . .Unsecured Loans . . . . . . . . . . . . . . . . .
Consumers . . . . . . . . . . . . . . . . . .Secured Loans . . . . . . . . . . . . . . . . . . .
Number of Loan Business Outlets . . . . . .Staffed . . . . . . . . . . . . . . . . . . . . . . . .Unstaffed . . . . . . . . . . . . . . . . . . . . . .
QUICK MUJIN Machine . . . . . . .
Number of Cash Dispensers and ATMs . . . . . . . . . . . . . . . . . . . . . . .
Proprietary . . . . . . . . . . . . . . . . . . . . .Open 365 Days/Year . . . . . . . . . . .
Open 24 Hours/Day . . . . . . . . .Tie-up . . . . . . . . . . . . . . . . . . . . . . . . .
Others * . . . . . . . . . . . . . . . . . . . . . . . . . .
Number of MUJINKUN Outlets . . . . . .Number of MUJINKUN Machines . . . . . . . . . .
QUICK MUJIN Machine . . . . . . .
Note: “Others” indicates receipt of payment by convenience stores under an agency agreement.
yoy %
2008/3
175,864175,859175,859
5
-34.6-34.6-34.6-97.1
268,885268,710268,710
175
-18.6-18.5-18.5-69.4
2007/3
yoy %
Number of New Loan Customers (Non-Consolidated)
yoy
2008/3
1,689137
1,552—
-123-5
-118—
1,812142
1,670119
-191-135-56-75
2007/3
yoy
Number of Loan Business Outlets (Non-Consolidated)
yoy
2008/3
92,063 1,820 1,820 1,615
90,243 8,537
4,290 -21 -21 -17
4,311 73
87,7731,8411,8411,632
85,9328,464
3,905-111-110-95
4,016-439
2007/3
yoy
Cash Dispensers and ATMs (Non-Consolidated)
yoy
2008/3
1,688
1,688—
-132
-132—
yoy %
2009/3
185,453185,453185,453
—
5.5 5.5 5.5 —
yoy
2009/3
1,607118
1,489—
-82 -19-63—
yoy
2009/3
95,0241,6701,6701,485
93,3548,636
2,961-150-150-130
3,11199
yoy
2009/3
1,606
1,606—
-82
-82—
1,820
1,820128
-187
-188-73
2007/3
yoy
MUJINKUN (Non-Consolidated)
47
46,57646,57646,576
—
87,47487,47487,474
—
123,312123,312123,312
—
160,700160,700160,700
—
-13.3 -13.3 -13.3
—
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
-11.2 -11.2 -11.2
—
-3.2 -3.2 -3.2
—
0.0 0.0 0.0 —
yoy %yoy % yoy %
180,000180,000180,000
—
12.0 12.0 12.0
—
2011/3(E)
yoy %
1,591118
1,473—
1,566118
1,448—
1,525107
1,418—
1,35345
1,308—
-254 -73
-181 —
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy
-82 -11 -71 —
-41 0
-41 —
-16 0
-16 —
ytdytd ytd
1,24545
1,200—
-108 0
-108 —
2011/3(E)
yoy
94,5241,6541,6541,469
92,8708,677
95,1811,6291,6291,445
93,5528,742
95,8591,5891,5891,407
94,2708,795
95,6741,4171,4171,254
94,2578,804
650 -253 -253 -231 903 168
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy
835 -81 -81 -78 916 159
157 -41 -41 -40 198 106
-500 -16 -16 -16
-484 41
ytdytd ytd
—1,309
————
—-108
————
2011/3(E)
yoy
1,590
1,590—
1,565
1,565—
1,525
1,525—
1,353
1,359—
-253
-247 —
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy
-81
-81 —
-41
-41 —
-16
-16 —
ytdytd ytd
1,245
1,251—
-108
-108 —
2011/3(E)
yoy
48
Average Loan Yield * . . . . . . . . . . . . . .Unsecured Loans . . . . . . . . . . . . . .
Consumers . . . . . . . . . . . . . . . .Commercials . . . . . . . . . . . . . . .
Secured Loans . . . . . . . . . . . . . . . .
Number of Total Employees . . . . . . . . . . . .Permanent Employees . . . . . . . . . . . . . . .Temporary Employees . . . . . . . . . . . . . .
yoy
2008/3
3,1872,774
413
-187-182
-5
3,3742,956
418
-1,090-955-135
2007/3
yoy
Employees (Non-Consolidated)
Accounts Receivable-operating Loans . . . . . .28.470% and Higher . . . . . . . . . . . . . . .27.375% . . . . . . . . . . . . . . . . . . . . . . . . .25.000% - 26.500% . . . . . . . . . . . . . . . .20.000% - 24.820% . . . . . . . . . . . . . . . .18.250% - 19.000% . . . . . . . . . . . . . . . .15.000% - 18.000% . . . . . . . . . . . . . . . .Less than 15.000% . . . . . . . . . . . . . . . . .
C.R.(%)
2008/3
1,277,87916,048
373,968183,019164,86548,616
434,05257,310
100.0 1.2
29.3 14.3 12.9 3.8
34.0 4.5
1,446,11720,506
537,612289,512278,94383,666
169,23566,641
100.0 1.4
37.2 20.0 19.3 5.8
11.7 4.6
2007/3
C.R.(%)
Millions of Yen
Receivables Outstanding
Unsecured Accounts Receivable-operating Loans by Interest Rate [Unsecured Loans for Consumers] (Non-Consolidated)
Effective Annual Interest Rate
Note: Average loan yield = Interest on operating loans / term average of receivable outstanding at the beginning of the year (%, Annual rate)
%
Average Loan Yield (Non-Consolidated)
23.13 23.55 23.55 17.12 12.27
-0.10 -0.17 -0.17 -1.84 0.11
2005/3
yoy p.p.
22.94 23.32 23.32 16.6312.38
-0.19 -0.23 -0.23 -0.490.11
2006/3
yoy p.p.
21.9122.2522.2515.5112.11
-1.03-1.07-1.07-1.12-0.27
2007/3
yoy p.p.
2008/32007/3
Accounts Receivable-operating Loans . . . . . .18.000%＜ . . . . . . . . . . . . . . . . . . . . . . .15.000%＜≦18.000% . . . . . . . . . . . . .12.000%＜≦15.000% . . . . . . . . . . . . .
≦12.000% . . . . . . . . . . . .
Millions of Yen
Receivables Outstanding
Unsecured Accounts Receivable-operating Loans by Interest Rate [Unsecured Loans for Consumers] (Non-Consolidated)
Effective Annual Interest Rate C.R.(%)
1,277,879786,517208,603226,25056,508
100.0 61.616.317.74.4
yoy
2009/3
3,0802,636
444
-107-138
31
C.R.(%)
2009/3
1,137,09912,534
267,887130,472115,75035,399
517,87357,183
100.0 1.1
23.6 11.5 10.2 3.1
45.5 5.0
2009/3
C.R.(%)
1,137,099562,043268,823253,69952,533
100.0 49.423.722.34.6
C.R.(%)
1,446,1171,210,241
123,08746,25566,533
100.0 83.78.53.24.6
49
2010/3 2011/3(E)
yoy
Millions of Yen
Receivables Outstanding
2010/3 2011/3(E)
C.R.(%)
yoy p.p.
2009/3
%
19.0819.3219.3215.4111.16
-1.67 -1.73 -1.73 -0.25 -0.47
yoy p.p.
2010/3
18.2118.4118.4115.0911.14
-0.87 -0.91 -0.91 -0.32 -0.02
16.9517.1417.149.699.55
-1.26 -1.27 -1.27 -5.40 -1.59
2011/3(E)
yoy p.p.
20.7521.0521.0515.6611.63
-1.16-1.20-1.200.15
-0.48
2008/3
yoy p.p.
1,179,28711,705
249,174121,479107,56933,208
595,46760,681
1,144,13010,963
230,247112,607100,05531,076
599,40159,778
1,106,24410,298
213,060104,52992,81229,123
597,31159,108
1,074,8949,672
197,01396,96886,15127,319
599,37158,397
100.0 0.9
18.3 9.0 8.0 2.6
55.8 5.4
1st quarter 2nd quarter 3rd quarter 4th quarterfull term C.R.(%)
100.0 0.9
19.3 9.5 8.4 2.6
54.0 5.3
100.0 1.0
20.1 9.8 8.8 2.7
52.4 5.2
100.0 1.0
21.1 10.3 9.1 2.8
50.5 5.2
C.R.(%)C.R.(%) C.R.(%)
922,5006,200
110,00061,30055,10019,800
611,20058,900
100.0 0.7
11.9 6.6 6.0 2.1
66.3 6.4
Millions of Yen
Receivables Outstanding
2011/3(E)2010/3
C.R.(%)
922,500252,500361,600256,90051,500
100.0 27.4 39.2 27.8 5.6
C.R.(%)4th quarterfull term
1,074,894417,125326,530280,88850,349
100.0 38.8 30.4 26.1 4.7
C.R.(%)3rd quarter
1,106,244449,823322,845282,65250,922
100.0 40.7 29.2 25.5 4.6
C.R.(%)2nd quarter
1,144,130484,950320,825286,71651,638
100.0 42.4 28.0 25.1 4.5
C.R.(%)1st quarter
1,179,287523,138314,376289,29452,478
100.0 44.4 26.7 24.5 4.4
3,2332,785
448
3,1772,756
421
3,1562,768
388
2,8422,610
232
-238 -26
-212
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy
76 132-56
97 120-23
153 149
4
ytdytd ytd
—2,043
—
—-567
—
50
≦2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2＜≦5 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5＜≦7 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7＜≦10 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10＜ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
≦100 . . . . . . . . . . . . . . . . . . .100＜≦300 . . . . . . . . . . . . . . . . . . .300＜≦500 . . . . . . . . . . . . . . . . . . .500＜≦1,000 . . . . . . . . . . . . . . . . .1,000＜ . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . .
C.R. (%)
2009/3
13,79098,438
417,322186,413421,135
1,137,099
1.28.7
36.716.437.0
100.0
15,721102,108473,805213,188473,055
1,277,879
1.2 8.0
37.1 16.7 37.0
100.0
2008/3
C.R. (%)
Millions of Yen
Unsecured Accounts Receivable-operating Loans by Classified Receivable Outstanding [Unsecured Loans for Consumers] (Non-Consolidated)
19,518106,969540,562252,047527,019
1,446,117
1.4 7.4
37.4 17.4 36.4
100.0
2007/3
Receivables Outstanding
C.R. (%)
Composition Ratio of Customer Accounts by Annual Income [Unsecured Loans for Consumers] (Non-Consolidated)
25.1 63.0 8.0 3.2 0.7
100.0
2006/3
139 158 192 220 243 159
Initial AverageLending Amount
Thousands of Yen
NewAccounts
%
22.157.912.95.81.3
100.0
ExistingAccounts
%
25.162.97.93.40.7
100.0
2007/3
135158192221244158
Initial AverageLending Amount
Thousands of Yen
NewAccounts
%
22.157.912.85.91.3
100.0
ExistingAccounts
%
Composition Ratio of Customer Accounts by Age [Unsecured Loans for Consumers] (Non-Consolidated)
Classified Receivable Outstanding(Thousands of Yen)
Annual Income (Millions of Yen)
Under 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Age 30 - 39 . . . . . . . . . . . . . . . . . . . . . . . . . . .Age 40 - 49 . . . . . . . . . . . . . . . . . . . . . . . . . . .Age 50 - 59 . . . . . . . . . . . . . . . . . . . . . . . . . . .Over 60 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48.621.314.911.43.8
100.0
2006/3
22.1 29.3 20.9 18.9 8.8
100.0
Existing Accounts
NewAccounts
22.5 28.1 21.6 18.7 9.1
100.0
Write-offsAccounts
47.021.715.312.04.0
100.0
2007/3
20.5 29.2 21.3 19.3 9.7
100.0
Existing Accounts
NewAccounts
23.2 27.5 20.9 19.7 8.7
100.0
Write-offsAccounts
%
51
Millions of Yen
14,682108,486425,897196,494433,726
1,179,287
14,434106,717410,637191,637420,704
1,144,130
13,949104,008395,203186,695406,387
1,106,244
13,769102,547382,376182,091394,108
1,074,894
1.39.5
35.616.936.7
100.0
2010/3
Receivables Outstanding
1st quarter 2nd quarter 3rd quarter 4th quarterfull term
C.R. (%)
1.39.4
35.716.936.7
100.0
1.39.3
35.916.736.8
100.0
1.29.2
36.116.736.8
100.0
C.R. (%)
C.R. (%)
C.R. (%)
12,30091,900
322,300159,800336,200922,500
1.310.0 34.917.336.5
100.0
2011/3(E)
C.R. (%)
21.863.09.94.40.9
100.0
2008/3
138182214244283179
Initial AverageLending Amount
Thousands of Yen
NewAccounts
%
22.157.313.16.11.4
100.0
ExistingAccounts
%
20.863.610.14.41.1
100.0
2009/3
135173213245290174
Initial AverageLending Amount
Thousands of Yen
NewAccounts
%
22.056.813.36.31.6
100.0
ExistingAccounts
%
22.963.19.04.01.0
100.0
2010/3
125165208240279165
Initial AverageLending Amount
Thousands of Yen
NewAccounts
%
22.755.613.46.61.7
100.0
ExistingAccounts
%
44.422.616.712.53.8
100.0
2008/3
18.8 28.8 22.1 19.2 11.1
100.0
Existing Accounts
NewAccounts
17.1 28.0 22.7 20.0 12.2
100.0
Write-offsAccounts
43.223.417.212.04.2
100.0
2009/3
18.0 28.2 22.6 19.1 12.1
100.0
Existing Accounts
NewAccounts
14.127.723.820.414.0
100.0
Write-offsAccounts
45.222.716.511.24.4
100.0
2010/3
17.2 27.7 23.7 18.8 12.6
100.0
Existing Accounts
NewAccounts
13.127.0 24.420.315.2
100.0
Write-offsAccounts
%
52
Loan Business . . . . . . . . . . . . . . . . . . . . .Unsecured Loans . . . . . . . . . . . . . . . .Secured Loans . . . . . . . . . . . . . . . . . .
Credit Card Business . . . . . . . . . . . . . . . .Installment Sales Finance Business *3 . . . .
<Reference>Guarantee Business . . . . . . . . . . . . . . . . .
Bad Debts Expenses . . . . . . . . . . . . . . . .Loan Business . . . . . . . . . . . . . . . . . . .
Unsecured Loans . . . . . . . . . . . . . .Secured Loans . . . . . . . . . . . . . . . .
Credit Card Business . . . . . . . . . . . . .Installment Sales Finance Business * . .Guarantee Business . . . . . . . . . . . . . .
Average Amount of Bad Debts Expenses per Account for Unsecured Loans (Thousands of Yen) . . . . . . . . . . . . . . .
<Reference>Average Balance of Unsecured Loans for Consumers per Account (Thousands of Yen) . . . . . . . . . . . . . . . .
Male . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Female . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
%
Composition Ratio of Customer Accounts by Gender [Unsecured Loans for Consumers] (Non-Consolidated)
yoy %
2009/3
149,805136,434135,736
6983,952
—9,390
502
535
-12.1 -12.4 -12.5 28.4
-18.1 —
-1.1
4.6
-0.9
170,506155,755155,211
5444,825
—9,499
480
540
22.7 23.6 23.7 3.9
17.0 —
26.7
9.6
-0.2
2008/3
yoy %
Millions of Yen
Bad Debts Expenses (Non-Consolidated)
138,977126,038125,515
5234,1231,2777,495
438
541
29.6 31.5 32.0
-32.2 5.6
-38.9 38.6
3.1
-0.2
2007/3
yoy %
yoy p.p.
2009/3
11.6211.921.98
12.23—
4.54
(-0.17)(-0.21)(0.67)
(-0.54)—
(-0.38)
11.7912.131.31
12.77—
4.92
(3.37)(3.46)(0.24)(3.48)
—
(0.95)
2008/3
yoy p.p.
%
Ratio of Bad Debts Expenses (Non-Consolidated) *1, 2
8.428.671.079.293.97
3.97
(2.43)(2.52)
(-0.34)(1.09)
(-0.56)
(0.79)
2007/3
yoy p.p.
Notes: 1. Ratio of Bad Debts Expenses Loan Business = Bad debts expenses of loan business / (receivables outstanding plus loans to borrowers in bankruptcy or under reorganization)Credit Card Business = Bad debts expenses of credit card business / card shopping receivablesInstallment Sales Finance Business = Bad debts expenses of installment sales finance business / installment receivablesGuarantee Business = Bad debts expenses guarantee business / (guaranteed receivables plus payments in subrogation)
2. Figures in brackets indicate year-on-year change in percentage points.3. AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007.
Note: AFRESH CREDIT CO., LTD. (formerly, JCK CREDIT CO., LTD.) succeeded to ACOM’s split up installment sales finance business as of April 1, 2007.
69.530.5
2006/3
73.3 26.7
Existing Accounts
NewAccounts
69.8 30.2
Write-offsAccounts
68.731.3
2007/3
73.2 26.8
Existing Accounts
NewAccounts
70.1 29.9
Write-offsAccounts
53
%
Millions of Yen
37,08933,61533,499
116996—
2,476
522
525
74,69967,83167,544
2872,040
—4,802
521
529
109,45598,99398,494
4982,958
—7,473
519
556
141,898128,964128,151
8123,752
—9,150
518
554
-5.3 -5.5 -5.6 16.4 -5.0
—-2.6
3.2
3.6
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy %
-5.0 -5.8 -5.8 -6.6 -3.0
—4.9
3.6
3.9
-5.0 -5.5 -5.4
-22.9 -1.2
—0.6
5.0
-1.7
-4.7 -4.5 -4.3
-35.4 -5.1
—-8.4
5.9
-2.6
yoy % yoy % yoy %
———————
—
516
———————
—
-6.9
2011/3(E)
yoy %
%
2.772.840.343.22
—
1.89
5.76 5.90 0.88 6.95
—
1.48
8.70 8.89 1.61
10.61—
2.30
11.67 11.91 2.75
14.14—
2.76
(0.05)(-0.01)(0.77)(1.91)
—
(-1.78)
2010/3
1st quarter 2nd quarter 3rd quarter 4th quarterfull term yoy p.p.
(-0.02)(-0.06)(0.15)(1.53)
—
(-1.20)
(-0.01)(-0.02)(-0.10)(1.05)
—
(-0.89)
(0.03)(0.02)
(-0.11)(0.33)
—
(0.51)
yoy p.p. yoy p.p. yoy p.p.
—————
—
—————
—
2011/3(E)
yoy p.p.
70.929.1
2008/3
73.5 26.5
Existing Accounts
NewAccounts
70.0 30.0
Write-offsAccounts
69.130.9
2009/3
73.526.5
Existing Accounts
NewAccounts
70.129.9
Write-offsAccounts
70.529.5
2010/3
73.126.9
Existing Accounts
NewAccounts
72.127.9
Write-offsAccounts
54
Total Amount of Non-performing Loans . . . . . . . . . . . .Loans to Borrowers in Bankruptcy or Under Reorganization . . . . . . . . . . . . . . . . . . . . .
Applications for Bankruptcy are Proceeded . . . . . .Applications for the Civil Rehabilitation are Proceeded . . . . . . . . . . . . . . . . . . . . . . . . . . .
Applications for the Civil Rehabilitation are Determined . . . . . . . . . . . . . . . . . . . . . . . . . .
Loans in Arrears * . . . . . . . . . . . . . . . . . . . . . . . . . . .Loans Past Due for Three Months or More . . . . . . . .Restructured Loans . . . . . . . . . . . . . . . . . . . . . . . . . .
2008/3
Millions of Yen
Non-performing Loans (Non-Consolidated)
6.85
0.44 0.08
0.17
0.15 2.92 0.07 3.42
%
141,307
6,1201,026
2,430
2,10880,976
49953,711
9.44
0.41 0.07
0.16
0.14 5.41 0.03 3.59
%
9.44
0.37 0.04
0.13
0.15 5.73 0.06 3.29
%
2006/3 2007/3
Provision for Loss on Interest Repayment * . . . . . . . . . .Increase or Decrease in Provision . . . . . . . . . . . . . . . . . .
Millions of Yen
2008/3
Provision for Loss on Interest Repayment (Non-Consolidated)
23,70023,700
——
yoy %
490,000466,300
——
yoy %
374,800-115,200
——
yoy %
2006/3 2007/3
11 days ≦＜ 3 months . . . . . . . . . . . . . . . . . . . . . . . . .31 days ≦＜ 3 months . . . . . . . . . . . . . . . . . . . . . . .11 days ≦＜ 31 days . . . . . . . . . . . . . . . . . . . . . . . .
2008/3
Millions of Yen
12,9687,2895,679
0.81 0.46 0.36
%
17,2236,586
10,637
1.15 0.44 0.71
%
19,7097,603
12,106
1.49 0.58 0.92
%
2006/3 2007/3
Note: In line with the inclusion of provision for loss on interest repayment, the amount of loans to borrowers seeking legal counsel that has not been resolved yet is counted in theamount of loans in arrears as loans exclusive of accrued interest from the fiscal year ended March 31, 2006.
Millions of Yen
Allowance for Doubtful Accounts . . . . . . . . . . . . . . . . . .Ratio of Allowance (%) * . . . . . . . . . . . . . . . . . . .
General Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . .Unsecured Consumer Loans . . . . . . . . . . . . . . . . .
Specific Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . .Increase or Decrease in Allowance . . . . . . . . . . . . . . . . .
Provision for Loss on Guarantees . . . . . . . . . . . . . . . . . .Increase or Decrease in Allowance . . . . . . . . . . . . . . .
2008/3
Allowance for Doubtful Accounts (Non-Consolidated)
122,7007.26
66,81061,18754,276
300
3,330450
0.2 —
-13.1 -11.8 24.3
—
15.6 -55.7
yoy %
121,0007.72
54,25748,96365,145-1,700
3,670340
-1.4 —
-18.8 -20.0 20.0
—
10.2 -24.4
yoy %
108,5008.00
48,65744,43658,843
-12,500
3,490-180
-10.3 —
-10.3 -9.2 -9.7
—
-4.9 —
yoy %
2006/3 2007/3
Note:
Loans in Arrears for Less Than 3 Months [excluding balance held by headquarters’ collection department] (Non-Consolidated)
Ratio of allowance for doubtful accounts (%) = ×100Allowance for doubtful accounts
Accounts receivable-operating loans at term-end plus installment receivables (excluding deferred income on installment sales finance)
109,573
7,0001,307
2,716
2,35846,7091,110
54,752
124,767
4,824557
1,695
1,92475,690
72743,524
Note: The numbers in the above contain a portion of Allowance for doubtful accounts calculated by former method from interim accounting period as of September 2006.
55
Millions of Yen
2010/3
%4th quarterfull term
Millions of Yen
2009/3 2010/3
283,400-91,400
——
yoy % yoy % yoy %
244,900-38,500
——
yoy %
218,200-65,200
——
200,600-82,800
——
204,500-78,900
——
yoy %
2011/3(E)
——
——
yoy %1st quarter 2nd quarter 3rd quarter 4th quarterfull term
2009/3
116,132
3,409344
1,030
1,48672,841
93538,945
9.89
0.29 0.03
0.09
0.13 6.21 0.08 3.32
%
118,727
3,128336
894
1,33077,3341,646
36,617
9.78
0.26 0.03
0.07
0.11 6.37 0.14 3.02
%
112,811
3,020347
913
1,19272,1932,028
35,568
9.58
0.26 0.03
0.08
0.10 6.13 0.17 3.02
%
112,192
2,937299
998
1,09972,5032,575
34,177
9.86
0.26 0.03
0.09
0.10 6.37 0.23 3.00
%
109,134
2,767281
941
1,05561,0601,443
43,863
9.87
0.25 0.03
0.09
0.10 5.52 0.13 3.97
1st quarter 2nd quarter 3rd quarter
Millions of Yen
2010/32009/3
16,8887,3889,499
1.44 0.63 0.81
%
16,5428,0338,509
1.36 0.66 0.70
%
17,5657,9439,621
1.49 0.67 0.82
%
12,5456,6475,898
1.10 0.58 0.52
%
14,4337,0147,419
1.31 0.63 0.67
%1st quarter 2nd quarter 3rd quarter 4th quarterfull term
Millions of Yen
2009/3 2010/3
yoy % yoy %1st quarter
84,0006.98
44,34740,75938,733
-24,500
3,390-100
-22.6 —
-8.9 -8.3
-34.2 —
-2.9 —
yoy %
87,0007.00
47,19343,73038,9563,000
1,700-1,690
-14.0 —
4.7 6.2
-29.4 —
-51.6 —
yoy %
88,7007.36
50,64947,24337,0514,700
7,8204,430
-6.0 —
19.1 22.2
-27.3 —
139.1 —
85,8007.37
49,11445,71435,7821,800
7,7404,350
-7.0 —
15.4 17.7
-26.6 —
139.6 —
61,7005.46
32,55529,17828,374
-22,300
8,2704,880
-26.5 —
-26.6 -28.4 -26.7
—
144.0 —
yoy %
2011/3(E)
——————
——
——————
——
yoy %2nd quarter 3rd quarter 4th quarterfull term
56
Borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Indirect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
City Banks, etc. *1 . . . . . . . . . . . . . . . . . . . .Regional Banks . . . . . . . . . . . . . . . . . . . . . .Trust Banks . . . . . . . . . . . . . . . . . . . . . . . .Foreign Banks . . . . . . . . . . . . . . . . . . . . . . .Life Insurance Companies . . . . . . . . . . . . .Non-life Insurance Companies . . . . . . . . . .Others . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Direct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Straight Bonds . . . . . . . . . . . . . . . . . . . . . .Asset Based Lending . . . . . . . . . . . . . . . . . .Commercial Papers . . . . . . . . . . . . . . . . . . .Others *2 . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term Loans Payable . . . . . . . . . . . . . . . . . . .Long-term Loans Payable . . . . . . . . . . . . . . . . . . .Fixed
Interest Rate Swaps (Notional) . . . . . . . . . . . .Interest Cap (Notional) . . . . . . . . . . . . . . . . . .
Average Interest Rate on Funds Procured During the Year (%) . . .
Average Nominal Interest Rate on Funds Procured During the Year *3 . . .
Floating Interest Rate . . . . . . . . . . . . . . . . . . .Fixed Interest Rate . . . . . . . . . . . . . . . . . . . . . .Short-term . . . . . . . . . . . . . . . . . . . . . . . . . . . .Long-term . . . . . . . . . . . . . . . . . . . . . . . . . . . .Direct . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Indirect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<Reference>Term Average of Long-term Prime Rate . . . . .
2007/32006/32005/3
Millions of Yen
100.0 70.0 7.3 3.2
32.9 0.6
18.4 2.9 4.7
30.0 25.8
— 1.9 2.3 2.2
97.8 87.5 15.7 8.0
—
———————
—
945,208614,28865,53619,330
290,0936,500
152,74921,65958,421
330,920265,000
—50,00015,92051,000
894,208805,086207,053
7,000
1.84
1.471.331.690.191.901.641.94
1.76
888,587580,62768,17718,433
269,3407,500
112,58116,53088,066
307,960260,000
—40,0007,960
60,000828,587762,560236,505
—
1.86
1.531.811.870.461.951.532.04
2.39
Funds Procurement (Non-Consolidated)
C.R.(%)
100.0 65.0 6.9 2.0
30.7 0.7
16.2 2.3 6.2
35.0 28.0
— 5.3 1.7 5.4
94.6 85.2 21.9 0.7
—
———————
—
C.R.(%)
100.0 65.3 7.7 2.1
30.3 0.8
12.7 1.8 9.9
34.7 29.3
— 4.5 0.9 6.8
93.2 85.8 26.6
—
—
———————
—
C.R.(%)
1,028,722719,84275,40932,791
337,9516,500
189,09029,43948,662
308,880265,000
—20,00023,88022,500
1,006,222900,468161,71282,000
1.92
1.611.661.960.801.921.801.97
1.69
Notes: 1. “Former Long-term Credit Banks” is listed under “City Banks, etc.”2. The exercised outstanding of commitment facility (structured finance) is booked under “Others” in “Direct” according to management accounting.3. Financial expenses pertaining to derivatives have been excluded from the calculation of average nominal interest rate on funds procured during the year.
57
Millions of Yen
2011/3(E)2010/32009/32008/3
774,407514,40790,23817,271
176,9457,500
95,90911,144
115,400260,000260,000
————
774,407717,872228,987
—
1.94
1.642.111.930.871.951.722.02
2.30
680,734445,73479,36518,222
149,5416,000
76,5109,072
107,024235,000235,000
————
680,734612,400189,485
—
2.04
1.792.302.01
—2.041.842.10
2.31
705,387463,887107,75714,743
162,5785,000
62,8208,088
102,901241,500221,50020,000
———
705,387630,422238,764
—
2.28
1.74 2.07 2.30
—2.28 1.92 2.41
1.87
654,100416,800
———————
237,300—————
654,100615,600
——
2.76
2.17 2.24 2.81
—2.76 2.29 3.01
—
100.0 66.4 11.7 2.2
22.8 1.0
12.4 1.4
14.9 33.6 33.6
— ———
100.0 92.7 29.6
—
—
———————
—
C.R.(%)
100.0 65.5 11.7 2.7
22.0 0.9
11.2 1.3
15.7 34.5 34.5
— ———
100.0 90.0 27.8
—
—
———————
—
C.R.(%)
3.6 4.1
35.8 -19.1
8.7-16.7 -17.9 -10.8 -3.9 2.8
-5.7 ————
3.6 2.9
26.0 —
—
———————
—
yoy %
100.0 65.8 15.3 2.1
23.0 0.7 8.9 1.1
14.6 34.2 31.4 2.8 ———
100.0 89.4 33.8
—
—
———————
—
C.R.(%)
-7.3 -10.2
———————
-1.7 —————
-7.3 -2.4
——
—
———————
—
100.0 63.7
———————
36.3 —————
100.0 94.1
——
—
———————
—
C.R.(%)yoy %
58
Investor InformationAs of March 31, 2010
Foreign Corporation and Individuals5.53%
Japanese Individuals and Other11.46%
Japanese FinancialInstrumentsBusinessOperator0.16%
Japanese Financial Institutions and Insurance Companies7.78%
Treasury Stock1.86%
Other Japanese Corporations73.21%
Index
0
250
200
150
50
100
Thousands of Shares
0
50,000
40,000
30,000
10,000
20,000
TOPIX
’09/4’08/10’08/4 ’10/4’09/10’05/4 ’05/10 ’06/10’06/4 ’07/10’07/4
ACOM Trading Volume per Month (right axis)ACOM Share Price
Breakdown of Shareholders
Other Data
Transfer Agent:Mitsubishi UFJ Trust and Banking Corporation
Stock Listing:First Section of Tokyo Stock Exchange
General Shareholders’ Meeting:June 24, 2010
Number of Stock Issued:159,628,280
Number of Shareholders:13,874
ADR (American Depositary Receipts) Information
Type: Sponsored Level-1 Program
ADR Ratio: 4ADRs : 1 Ordinary Share
Symbol: ACMUY
CUSIP: 004845202
Market: The U.S. Market for OTC (Over-the-Counter)
Depositary Bank: The Bank of New York Mellon101 Barclay Street, 22W, NEW YORK, NY 10286, U.S.A.TEL: 1-201-680-6825Toll-free number from the United States:
888-269-2377 (888-BNY-ADRS)URL: http://www.adrbnymellon.com
Principal ShareholdersName Number of shares held % of ownership
of voting right
Mitsubishi UFJ Financial Group, Inc. .......................... 58,872,349 37.57Maruito Shokusan Co., Ltd. ......................................... 27,346,755 17.45Maruito Co., Ltd.......................................................... 12,553,343 8.01Kinoshita Memorial Foundation .................................. 9,219,232 5.88Maruito Shoten Co., Ltd. ............................................. 3,873,320 2.47Kyosuke Kinoshita ....................................................... 3,240,321 2.06Shigeyoshi Kinoshita .................................................... 3,220,164 2.05Mitsubishi UFJ Trust and Banking Corporation .......... 3,157,280 2.01NOBUKA CO., LTD .................................................. 3,000,000 1.91Japan Trustee Services Bank, Ltd. (Trust Account 4).... 2,608,510 1.66
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