Year ended March 31, 20102010

THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Profile (Consolidated)

Based in Niigata Prefecture on the western coast of Japan’smain island, Honshu, Daishi Bank is the oldest bank in Japanand the most influential institution in the prefecture. It wasfounded in 1873 as the Fourth National Bank of Japan.

Niigata Prefecture, Daishi Bank's target marketaerA

noitalupoP

PDG

Gross agricultural output

Industrial shipment per capital

Annual sales

Deposits ¥4,072 billion

Loans ¥2,498 billion

Total assets ¥4,500 billion

Number of branches 122

Credit rating A2 (Moody’s)

Niigata, Our Target MarketIn Niigata Prefecture, basic technology indispensable formanufacturing is accumulating at an accelerated rate. Thisincludes mold-making, high-precision machining, casting,forging, and metal pressing. Niigata Prefecture is the numberone manufacturer in Japan of products such as metal table-ware and oil stoves.

With a prosperous agricultural industry centering on ricegrowing, it is a leading producer of rice and the number onemanufacturer of rice confectionery in Japan.

(As of March 31, 2010)

Contents13 Consolidated Statements of Operations14 Consolidated Statements of Shareholders' Equity15 Consolidated Statements of Cash Flows16 Notes To Consolidated Financial Statements26 Corporate Organization Directory Chart27 Corporate Data

1

(For the Years ended March 31) 201020102008 2009

Thousands ofU.S. DollarsMillions of Yen

Notes: (1) In this annual report, Japanese yen in millions are indicated with fractions omitted.

U.S. DollarsYen

Financial Highlights

IncomeInterest on Loans and

Discounts.....................................

Interest and Dividends on

Securities.....................................

Total Income...................................

ExpensesInterest on Deposits .......................

General and Administrative

Expenses.....................................

Total Expenses...............................

Net Income ...................................

AssetsSecurities........................................

Loans and Bills Discounted............

Total Assets ....................................

LiabilitiesDeposits .........................................

Total Liabilities................................

Net AssetsCapital Stock ..................................

Shareholders’ Equity ......................

Total Net Assets .............................

Amounts per Share of Capital StockNet Income.....................................

Cash Dividends..............................

1 Financial Highlights3 Message from the President6 Financial services with roots in the regional community6 Contributing to the Regional Communities7 Environmental Measures8 Compliance9 Corporate Governance

10 Risk Management

12 Consolidated Balance Sheets

(2) The translations of the Japanese yen amounts into US dollars are using the prevailing exchange rate at March 31, 2010, which was ¥93.04 to US$1.

¥ 46,805

19,493115,175

9,345

47,88697,772

9,322

1,391,9652,335,2864,115,845

3,748,3663,884,001

32,776186,078231,843

25.15 7.00

(Consolidated)

km2

thousands

billion

billion

billion

billion

12,583

2,378

¥8,979

¥277

¥5,195

¥7,185

( 5 th of 47 pref.)

(14 th of 47 pref.)

(14 th of 47 pref.)

( 9 th of 47 pref.)

(23 th of 47 pref.)

(14 th of 47 pref.)

¥ 43,822

18,225102,694

6,967

49,85888,767

7,528

1,624,8162,498,4794,500,985

4,072,0754,261,278

32,776195,055239,707

$ 471,010

195,8901,103,765

74,882

535,880954,083

80,914

17,463,63226,853,82448,376,884

43,766,92945,800,496

352,2892,096,4682,576,388

20.38 7.00

0.21 0.07

¥ 47,525

19,846113,139

9,996

48,878100,121

6,677

1,467,2612,478,5144,349,791

3,906,2854,134,529

32,776190,036215,262

18.06 7.00

Air RoutesSea Routes

Keelung

Kaohsiung

To Singapore

To the East Coast of North America

Niigata

Tokyo

Sapporo

Fukuoka

NagoyaOsaka

Pusan

Seoul

Dalian

Vladivostok

Shanghai

Qingdao

Hong Kong Naha

ShinkansenExpressway

Narita International Airport

Central Japan International Airport

Kansai International Airport

Niigata

Joetsu

ArakawaTainai

Koriyama

OmiyaTakasaki

Nagano

NagoyaKyoto

Nagaoka

Sendai

Tokyo

Osaka

KhabarovskHarbin

THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Profile (Consolidated)

Based in Niigata Prefecture on the western coast of Japan’smain island, Honshu, Daishi Bank is the oldest bank in Japanand the most influential institution in the prefecture. It wasfounded in 1873 as the Fourth National Bank of Japan.

Niigata Prefecture, Daishi Bank's target marketaerA

noitalupoP

PDG

Gross agricultural output

Industrial shipment per capital

Annual sales

Deposits ¥4,072 billion

Loans ¥2,498 billion

Total assets ¥4,500 billion

Number of branches 122

Credit rating A2 (Moody’s)

Niigata, Our Target MarketIn Niigata Prefecture, basic technology indispensable formanufacturing is accumulating at an accelerated rate. Thisincludes mold-making, high-precision machining, casting,forging, and metal pressing. Niigata Prefecture is the numberone manufacturer in Japan of products such as metal table-ware and oil stoves.

With a prosperous agricultural industry centering on ricegrowing, it is a leading producer of rice and the number onemanufacturer of rice confectionery in Japan.

(As of March 31, 2010)

Contents13 Consolidated Statements of Operations14 Consolidated Statements of Shareholders' Equity15 Consolidated Statements of Cash Flows16 Notes To Consolidated Financial Statements26 Corporate Organization Directory Chart27 Corporate Data

1

(For the Years ended March 31) 201020102008 2009

Thousands ofU.S. DollarsMillions of Yen

Notes: (1) In this annual report, Japanese yen in millions are indicated with fractions omitted.

U.S. DollarsYen

Financial Highlights

IncomeInterest on Loans and

Discounts.....................................

Interest and Dividends on

Securities.....................................

Total Income...................................

ExpensesInterest on Deposits .......................

General and Administrative

Expenses.....................................

Total Expenses...............................

Net Income ...................................

AssetsSecurities........................................

Loans and Bills Discounted............

Total Assets ....................................

LiabilitiesDeposits .........................................

Total Liabilities................................

Net AssetsCapital Stock ..................................

Shareholders’ Equity ......................

Total Net Assets .............................

Amounts per Share of Capital StockNet Income.....................................

Cash Dividends..............................

1 Financial Highlights3 Message from the President6 Financial services with roots in the regional community6 Contributing to the Regional Communities7 Environmental Measures8 Compliance9 Corporate Governance

10 Risk Management

12 Consolidated Balance Sheets

(2) The translations of the Japanese yen amounts into US dollars are using the prevailing exchange rate at March 31, 2010, which was ¥93.04 to US$1.

¥ 46,805

19,493115,175

9,345

47,88697,772

9,322

1,391,9652,335,2864,115,845

3,748,3663,884,001

32,776186,078231,843

25.15 7.00

(Consolidated)

km2

thousands

billion

billion

billion

billion

12,583

2,378

¥8,979

¥277

¥5,195

¥7,185

( 5 th of 47 pref.)

(14 th of 47 pref.)

(14 th of 47 pref.)

( 9 th of 47 pref.)

(23 th of 47 pref.)

(14 th of 47 pref.)

¥ 43,822

18,225102,694

6,967

49,85888,767

7,528

1,624,8162,498,4794,500,985

4,072,0754,261,278

32,776195,055239,707

$ 471,010

195,8901,103,765

74,882

535,880954,083

80,914

17,463,63226,853,82448,376,884

43,766,92945,800,496

352,2892,096,4682,576,388

20.38 7.00

0.21 0.07

¥ 47,525

19,846113,139

9,996

48,878100,121

6,677

1,467,2612,478,5144,349,791

3,906,2854,134,529

32,776190,036215,262

18.06 7.00

Air RoutesSea Routes

Keelung

Kaohsiung

To Singapore

To the East Coast of North America

Niigata

Tokyo

Sapporo

Fukuoka

NagoyaOsaka

Pusan

Seoul

Dalian

Vladivostok

Shanghai

Qingdao

Hong Kong Naha

ShinkansenExpressway

Narita International Airport

Central Japan International Airport

Kansai International Airport

Niigata

Joetsu

ArakawaTainai

Koriyama

OmiyaTakasaki

Nagano

NagoyaKyoto

Nagaoka

Sendai

Tokyo

Osaka

KhabarovskHarbin

Financial Review (Consolidated) Message from the President

I would like to take this opportunity to express our sincere gratitude and appreciation to all of our stakeholders.　Since our establishment in 1873 as Dai-yon Kokuritsu Ginko (“the Fourth National Bank of Japan”), Daishi Bank has grown in partnership with the people of Niigata Prefecture, the regional community in which the main business of Daishi Bank is located. We are grateful for the constant support and encouragement we receive from our customers, shareholders, and the regional community. 　The difficult operating conditions in FY 2008 in international financial markets improved in FY 2009 for the Japanese economy. Exports picked up at the beginning of the fiscal year and stimulus measures began to see results. By the end of the fiscal year, clear signs of recovery were on the horizon. Unfortunately, the ability of the Japanese economy to rebound on its own was limited, and so the business environment remains challenging. 　Clear signs of recovery were no more forthcoming in Niigata Prefecture, Daishi Bank’s main operating base. As with the national economy, gradual improvement in production activity was seen, however business appetite for capital investment and consumers’ desire to invest in residential housing remained low, while employment stayed unfavorable. 　Daishi Bank’s reaction to these difficult prospects is

contained in the “Daishi AAAA (Four-A) Plan”, our current middle-term plan launched in FY 2009 and covering the period April, 2009 to March, 2012. The “Four-A” designation conveys our commitment to visit our customers frequently (Ashi), work diligently (Ase), use our heads to devise high-quality solutions (Atama), and convey to customers our deep and sincere gratitude (Arigato) for their support. This Four-A commitment forms the basis for four core strategies for strengthening relationships of trust with our customers: innovation in retail branches, boosting profitability, restructuring of personnel, and pursuit of customer satisfaction. 　These strategies manifest themselves in a number of specific programs. To serve individual customers better, we supplemented yen-denominated deposits with mutual funds, foreign-currency accounts, and insurance products. In individual loans, Daishi Bank offered reduced interest rates on loans taken out to purchase environmentally friendly homes or vehicles. To supplement Tokimeki Niigata Teiki Yokin, a term deposit launched in 2009 to support the National Athletic Meet at Niigata, we launched the Tenchijin campaign in cooperation with Yamagata Bank and Toho Bank, which are also located in Sengoku Period warlord Naoe Kanetsugu country.

2010

2008 20102009

2010

As of June 30, 2010

*Daishi Bank calculates capital adequacy ratioaccording to the new BIS standards.

2008 2009

2008 2009

32 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Balance of deposits

Thanks to expansion in Daishi Bank’s roster of deposit products,tha balance of deposits increased.

Credit rating

Daishi Bank enjoys a credit rating of A+ (senior long-term credit rating) from the Japan Credit Rating Agency, Ltd. (JCR) while Moody’s Investors Service conferred on Daishi Bank a rate of A2 (long-term deposit rating).

Non-accrual-loan ratio

The non-accrual-loan ratio in accordance with the Financial Reconstruction Law became 3.46%. The headquarters and branch offices are working together to support customers in improving their business and financial management.

Balance of outstanding loans

Daishi Bank spared no effort to serve the financial needs of our customers. The balance of loans remained stable at ¥2,498 billion as of March 31, 2010.

Capital adequacy ratio

We are required to maintain a capital adequacy ratio of at least 4% by domestic standards. The capital adequacy ratio stood above 10% in the period under review on both a consolidated and non-consolidated basis, demonstrating Daishi Bank’s exception-ally sound asset base.

Masayuki Obara President

Non-consolidated Consolidated

(%)

2

4

6 Loans subject to bankruptcy or rehabilitationLoans requiring management

0

●JCR ●

A

D

CCCCCC

BBB

BBB

AAAAA

A

Caa

Ca

C

B

Ba

Baa

Aa

AaaDaishi Bank

A--

A+

A

Daishi Bank

A3

A1A2

(¥ Billion)

(¥ Billion)

4,000

3,000

2,000

0

3,000

2,000

1,000

0

Loans at risk

Moody’s

8

12

(%)

420102008 2009

4,0723,748 3,906

2,4982,335 2,478

13.5512.8012.37

11.7512.69

12.02

0.332.71

0.42

2.590.47

0.47

0.222.79

0.48

3.463.54 3.50

Financial Review (Consolidated) Message from the President

I would like to take this opportunity to express our sincere gratitude and appreciation to all of our stakeholders.　Since our establishment in 1873 as Dai-yon Kokuritsu Ginko (“the Fourth National Bank of Japan”), Daishi Bank has grown in partnership with the people of Niigata Prefecture, the regional community in which the main business of Daishi Bank is located. We are grateful for the constant support and encouragement we receive from our customers, shareholders, and the regional community. 　The difficult operating conditions in FY 2008 in international financial markets improved in FY 2009 for the Japanese economy. Exports picked up at the beginning of the fiscal year and stimulus measures began to see results. By the end of the fiscal year, clear signs of recovery were on the horizon. Unfortunately, the ability of the Japanese economy to rebound on its own was limited, and so the business environment remains challenging. 　Clear signs of recovery were no more forthcoming in Niigata Prefecture, Daishi Bank’s main operating base. As with the national economy, gradual improvement in production activity was seen, however business appetite for capital investment and consumers’ desire to invest in residential housing remained low, while employment stayed unfavorable. 　Daishi Bank’s reaction to these difficult prospects is

contained in the “Daishi AAAA (Four-A) Plan”, our current middle-term plan launched in FY 2009 and covering the period April, 2009 to March, 2012. The “Four-A” designation conveys our commitment to visit our customers frequently (Ashi), work diligently (Ase), use our heads to devise high-quality solutions (Atama), and convey to customers our deep and sincere gratitude (Arigato) for their support. This Four-A commitment forms the basis for four core strategies for strengthening relationships of trust with our customers: innovation in retail branches, boosting profitability, restructuring of personnel, and pursuit of customer satisfaction. 　These strategies manifest themselves in a number of specific programs. To serve individual customers better, we supplemented yen-denominated deposits with mutual funds, foreign-currency accounts, and insurance products. In individual loans, Daishi Bank offered reduced interest rates on loans taken out to purchase environmentally friendly homes or vehicles. To supplement Tokimeki Niigata Teiki Yokin, a term deposit launched in 2009 to support the National Athletic Meet at Niigata, we launched the Tenchijin campaign in cooperation with Yamagata Bank and Toho Bank, which are also located in Sengoku Period warlord Naoe Kanetsugu country.

2010

2008 20102009

2010

As of June 30, 2010

*Daishi Bank calculates capital adequacy ratioaccording to the new BIS standards.

2008 2009

2008 2009

32 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Balance of deposits

Thanks to expansion in Daishi Bank’s roster of deposit products,tha balance of deposits increased.

Credit rating

Daishi Bank enjoys a credit rating of A+ (senior long-term credit rating) from the Japan Credit Rating Agency, Ltd. (JCR) while Moody’s Investors Service conferred on Daishi Bank a rate of A2 (long-term deposit rating).

Non-accrual-loan ratio

The non-accrual-loan ratio in accordance with the Financial Reconstruction Law became 3.46%. The headquarters and branch offices are working together to support customers in improving their business and financial management.

Balance of outstanding loans

Daishi Bank spared no effort to serve the financial needs of our customers. The balance of loans remained stable at ¥2,498 billion as of March 31, 2010.

Capital adequacy ratio

We are required to maintain a capital adequacy ratio of at least 4% by domestic standards. The capital adequacy ratio stood above 10% in the period under review on both a consolidated and non-consolidated basis, demonstrating Daishi Bank’s exception-ally sound asset base.

Masayuki Obara President

Non-consolidated Consolidated

(%)

2

4

6 Loans subject to bankruptcy or rehabilitationLoans requiring management

0

●JCR ●

A

D

CCCCCC

BBB

BBB

AAAAA

A

Caa

Ca

C

B

Ba

Baa

Aa

AaaDaishi Bank

A--

A+

A

Daishi Bank

A3

A1A2

(¥ Billion)

(¥ Billion)

4,000

3,000

2,000

0

3,000

2,000

1,000

0

Loans at risk

Moody’s

8

12

(%)

420102008 2009

4,0723,748 3,906

2,4982,335 2,478

13.5512.8012.37

11.7512.69

12.02

0.332.71

0.42

2.590.47

0.47

0.222.79

0.48

3.463.54 3.50

54 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

　For corporate customers, Daishi Bank has made efforts in support for businesses throughout the prefecture, providing a wide variety of syndicated loans and “emer-gency economic response loan-guarantee systems” through National Federation of Credit Guarantee Corpora-tions.　We are also actively working in business-matching activities for assisting customers starting new businesses or expanding business dealings. To the existing Daishi

Food Seminar, Daishi Bank added the “Niigata Food and Ecology Exhibition and Seminar”, which is geared to spur business discussions related to the environment and new energy sources, two areas expected to yield high growth. We also strengthened our support for agriculture, one of the economic mainstays of Niigata Prefecture, with Agri-Frontier, a loan product for farmers provided in partner-ship with the Credit Guarantee Agriculture Fund Associa-tion.

　Daishi Bank has responded quickly and appropriately to provide small business with advisory services, making ever stronger efforts to maintain smooth financing. These advisory services include consultation to SMEs on new loans and changes to the terms of loans including home loans. Daishi Bank even offered seminars to business-people with tips on improving management. By strength-ening our functions as a guide and advisor, Daishi Bank continued to fulfill our mission as a regional financial institution.　In FY 2009, Daishi Bank enhanced our branch office network and systems in preparation for the rollout of comprehensive financial services and greater conve-nience. Takada Main ofice and Nagaoka Main office were opened, boasting innovations such as Consulting Plaza, a total support system for individuals’ financial lifestyles. Branches of the group company Niigata Securities were also established within. These large branches offered customers the convenience of one-stop financial shopping. Daishi Bank also opened two new locations: Nagaoka-nishi Branch, which was moved from a previous location, and Takada Sales Office, Honcho local office. To acceler-ate improvements to services and product development as well as IT related cost reduction, Daishi Bank joined with Chiba Bank, Hokkoku Bank, Chugoku Bank, and Iyo Bank for the Tsubasa Project. In this project, the banks conferred to standardize a wide range of systems. As a result, a common call center was established in November 2009 while preparing the introduction of a new sales office system which will be linked to a newly introduced CRM system. By the end of FY 2010, Daishi Bank expects to move to this system at all branches.　In addition to strengthening our environmental stance, in February 2010 Daishi Bank launched Daishi Eco Action, which we followed in April by proclaiming an official Environmental Policy. Under this policy, we are enlightening all directors and employees on environmen-tal issues, providing support to businesses in environment-friendly operations through financial services, as well as actively implementing our own efforts

to preserve the environment. 　Through all these and other measures to meet custom-ers’ financial needs with high quality service, Daishi Bank desires to be a bank continually chosen by stakeholders such as shareholders and customers in the region. To this end, we believe it is vital to gain their trust as a financial organization that fulfills its corporate social responsibility and is firmly rooted in society through contribution to regional communities, environmental conservation activi-ties, and thorough implementation of the core of bank management, compliance. 　On behalf of the directors and employees of the Daishi Bank Group, I thank you for your continuing support, encouragement, and patronage.

『AAAA（Four-A）』Four-A stands for ashi (feet), ase (sweat), atama (head), and arigato (thank you). It also reflects our desire to earn the highest credit rating—higher even than the highest possible rating of AAA.

『Strengthening bonds of trust with customers』We achieve our mission by cultivating strong relationships of mutual trust with our customers.

Securing revenues and a sound financial constitution

Four management strategies

Daishi Bank will strengthen relationship-banking operations by reinventing our branches as consultation and sales bases.

Strategy II: Bolstering profitability

Da ish i Bank w i l l f ocus on customer needs, fostering close teamwork between branches and the head office to advance a comprehensive menu of finan-cial services.

Strategy III: Personnel restructuring

Bank personnel are the corner-stone of our operations. We will train our personnel in a planned and systematic manner.

Strategy I: Reforming branch operations

We will strengthen our relationship of trust with customers by accurately responding to their needs from customers’ perspec-tives.

Strategy IV: Pursuit of customer satisfaction

Financial services with roots in the regional community

Basis of operations Improving the quality of compliance

The AAAA (Four-A) Plan logoRecalling the motif of the lucky four-leaf clover, the Four-A Plan logo combines the four themes of ashi (feet; going to where the customer is), ase (sweat: working hard for the customer), atama (head: using our brains to find solutions), and arigato (thank you: a spirit of gratitude). The gradations in the leaves express the nurturing and growth of new shoots. 　Beginning in April 2010, all directors and employees wear badges with the Four-A logo to enhance awareness of the plan.

■

Key Themes■

『The Daishi AAAA (Four-A) Plan』Period: April 1, 2009 to March 31, 2012 (three years)

Middle-term Plan■

Four Keywords for Growth at Daishi Bank

■

Schematic view of the medium middle-term plan

■

54 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

　For corporate customers, Daishi Bank has made efforts in support for businesses throughout the prefecture, providing a wide variety of syndicated loans and “emer-gency economic response loan-guarantee systems” through National Federation of Credit Guarantee Corpora-tions.　We are also actively working in business-matching activities for assisting customers starting new businesses or expanding business dealings. To the existing Daishi

Food Seminar, Daishi Bank added the “Niigata Food and Ecology Exhibition and Seminar”, which is geared to spur business discussions related to the environment and new energy sources, two areas expected to yield high growth. We also strengthened our support for agriculture, one of the economic mainstays of Niigata Prefecture, with Agri-Frontier, a loan product for farmers provided in partner-ship with the Credit Guarantee Agriculture Fund Associa-tion.

　Daishi Bank has responded quickly and appropriately to provide small business with advisory services, making ever stronger efforts to maintain smooth financing. These advisory services include consultation to SMEs on new loans and changes to the terms of loans including home loans. Daishi Bank even offered seminars to business-people with tips on improving management. By strength-ening our functions as a guide and advisor, Daishi Bank continued to fulfill our mission as a regional financial institution.　In FY 2009, Daishi Bank enhanced our branch office network and systems in preparation for the rollout of comprehensive financial services and greater conve-nience. Takada Main ofice and Nagaoka Main office were opened, boasting innovations such as Consulting Plaza, a total support system for individuals’ financial lifestyles. Branches of the group company Niigata Securities were also established within. These large branches offered customers the convenience of one-stop financial shopping. Daishi Bank also opened two new locations: Nagaoka-nishi Branch, which was moved from a previous location, and Takada Sales Office, Honcho local office. To acceler-ate improvements to services and product development as well as IT related cost reduction, Daishi Bank joined with Chiba Bank, Hokkoku Bank, Chugoku Bank, and Iyo Bank for the Tsubasa Project. In this project, the banks conferred to standardize a wide range of systems. As a result, a common call center was established in November 2009 while preparing the introduction of a new sales office system which will be linked to a newly introduced CRM system. By the end of FY 2010, Daishi Bank expects to move to this system at all branches.　In addition to strengthening our environmental stance, in February 2010 Daishi Bank launched Daishi Eco Action, which we followed in April by proclaiming an official Environmental Policy. Under this policy, we are enlightening all directors and employees on environmen-tal issues, providing support to businesses in environment-friendly operations through financial services, as well as actively implementing our own efforts

to preserve the environment. 　Through all these and other measures to meet custom-ers’ financial needs with high quality service, Daishi Bank desires to be a bank continually chosen by stakeholders such as shareholders and customers in the region. To this end, we believe it is vital to gain their trust as a financial organization that fulfills its corporate social responsibility and is firmly rooted in society through contribution to regional communities, environmental conservation activi-ties, and thorough implementation of the core of bank management, compliance. 　On behalf of the directors and employees of the Daishi Bank Group, I thank you for your continuing support, encouragement, and patronage.

『AAAA（Four-A）』Four-A stands for ashi (feet), ase (sweat), atama (head), and arigato (thank you). It also reflects our desire to earn the highest credit rating—higher even than the highest possible rating of AAA.

『Strengthening bonds of trust with customers』We achieve our mission by cultivating strong relationships of mutual trust with our customers.

Securing revenues and a sound financial constitution

Four management strategies

Daishi Bank will strengthen relationship-banking operations by reinventing our branches as consultation and sales bases.

Strategy II: Bolstering profitability

Da ish i Bank w i l l f ocus on customer needs, fostering close teamwork between branches and the head office to advance a comprehensive menu of finan-cial services.

Strategy III: Personnel restructuring

Bank personnel are the corner-stone of our operations. We will train our personnel in a planned and systematic manner.

Strategy I: Reforming branch operations

We will strengthen our relationship of trust with customers by accurately responding to their needs from customers’ perspec-tives.

Strategy IV: Pursuit of customer satisfaction

Financial services with roots in the regional community

Basis of operations Improving the quality of compliance

The AAAA (Four-A) Plan logoRecalling the motif of the lucky four-leaf clover, the Four-A Plan logo combines the four themes of ashi (feet; going to where the customer is), ase (sweat: working hard for the customer), atama (head: using our brains to find solutions), and arigato (thank you: a spirit of gratitude). The gradations in the leaves express the nurturing and growth of new shoots. 　Beginning in April 2010, all directors and employees wear badges with the Four-A logo to enhance awareness of the plan.

■

Key Themes■

『The Daishi AAAA (Four-A) Plan』Period: April 1, 2009 to March 31, 2012 (three years)

Middle-term Plan■

Four Keywords for Growth at Daishi Bank

■

Schematic view of the medium middle-term plan

■

76 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Defined-contribution pension plans are corporate pensions offered in addition to public pensions. The key feature of these pension plans is that contributors (employees) decide how their pension assets are invested in consideration of their own expected needs in old age. 　Daishi Bank helps customers prepare for retirement. We design pension plans for companies to implement, offering

employee seminars and other forms of support. After they retire, customers can take advantage of our system for detailed consultation at branches. Daishi Bank is proud to support sound capital formation for private-sector employ-ees and employee-benefit schemes throughout Niigata Prefecture.

To add might to its efforts to grapple with environmental issues, in April 2010, Daishi Bank proclaimed the Daishi Bank Group Environmental Policy. Guided by this policy, Daishi Bank and our affiliates will strive to raise all directors’

and employees’ awareness of environmental issues, support customers’ environmental efforts through opera-tions, and lead efforts to preserve the precious environment.

In March 2010, Daishi Bank established a rating system for the environmental activities of each enterprise. Called Daishi Environmental Ratings, the rating system provides the basis for Daishi Environmentally Rated Finance, a system

for reduced interest rates according to each company’s environmental ranking. We offer a wide selection of service plans compliant with the interest subsidy system of the Ministry of the Environment.

Daishi Bank provides Niigata Prefecture’s agricultural producers, fisheries, and food processors with vital sales promotion support through the Daishi Food Seminars, a series of trade exhibition and seminar events. To date these events have produced over 500 business negotiations, contributing to the food businesses that are a vital mainstay of the Niigata economy. 　At the “Niigata Food and Ecology Exhibition and Semi-nar” in March 2010, a wide range of exhibitions and discus-

sions were held not only on the food industry but also on the environmental and new-energy industries, which are expected to enjoy solid growth in the near future. Daishi Bank is an active supporter of environ-mentally friendly businesses.

Daishi Bank dispatches employees to three cities in China: Shanghai, Dalian, and Hong Kong. These employees con-duct overseas support activities for Niigata-owned over-seas businesses, providing the latest local information and business know-how. 　In FY 2009, Daishi Bank launched a service catering to the consulting needs of customers currently doing business

with or seeking to do business with Chinese companies. Part-nering with the JETRO Niigata Trade Information Center, Daishi Bank offers a China Business Seminar twice a year.

▲China Business Seminar

▲Niigata Food and Ecology Exhibition 　and Seminar

The Research Center of Niigata is a think tank affiliated with Daishi Bank. With the collaboration of tourism organizations and administrative offices in each region of Niigata Prefec-ture, the Research Center of Niigata regularly conducts

questionnaire surveys while analyzing the current status and trends at hot-spring resort areas throughout the prefec-ture. These efforts play a role in energizing the economies of various regions.

For individual customers seeking loans to install environ-mentally friendly facilities in their homes or to purchase an

ecologically friendly car, Daishi Bank applies a lower than usual interest rate.

Financial services with roots in the regional community Environmental Measures　～ ～

Enhancing Defined-contribution Pension Operations The Daishi Bank Group’s Environmental Policy

Daishi Environmental Ratings and Daishi Environmentally Rated Loans

Business Seminars

Overseas Business Support

Stimulating Regional Development through Support for Tourism

Eco-friendly Car and Home Loans

To preserve the natural beauty of the Oze Plateau in perpe-tuity for future generations, since 2006 Daishi Bank manages the Oze Kiko Natural Environment Protection Fund

which contributes a part of its proceeds to the Oze Preser-vation Foundation. We will continue to support preservation of the Oze Plateau.

Nature Preservation Fund

To preserve the region’s lush, green environment for future generations, Daishi Bank is proud to take part in the Niigata Afforestation Support Project, a program by Niigata Prefec-ture. In October 2009, 400 Daishi Bank directors, employees, and family members took part in a tree-planting exercise at Daishi-no-Mori (“Daishi Forest”), located in Agamachi, Higashikanbara-gun, Niigata Prefecture.

　As a member of the regional community, Daishi Bank also enthusiastically joins the people of each area in volunteer cleanup activities.

Activities for Environmental Protection

▲Tree-planting activities ▲Volunteers harvesting rice on 　rice terraces

▲Volunteer cleanup of Ijimino Park　

【Basic Philosophy】

. Compliance

. Reducing environmental impact

. Supporting customers through excellence in banking

. Activities to preserve the environment

To preserve the abundant and beautiful natural environment of our native Niigata Prefecture and achieve a sustainable society, the Daishi Bank Group will work together to support customers who are working to preserve the environment, actively initiate measures to preserve the regional environment as a corporate citizen, and work toward solutions for environmental issues.

We comply with all environmental laws and regulations, taking due precautions to minimize environmental impact at all times.

We establish targets for reduction of environmental impact and undertake continuous activities to improve the environment by reducing energy, conserving resources, and implementing recycling.

We develop environmentally friendly products and services to offer comprehensive financial services to support customers making efforts to preserve the environment.

All directors and employees take steps to deepen their awareness of environmental issues and practice environmental awareness in all aspects of operations.

Code ofEnvironmentalConduct

Daishi Bank presents gifts of tulips, our official flower, to welfare facilities throughout Niigata Prefecture. Every spring and fall, Daishi Bank orders delivery of the flowers from bank locations to approximately 100 facilities prefecture-wide. A tradition since 1970, this practice has

taken hold as one of Daishi Bank’s most sustained contri-butions to society.

▲Presentation of Tulips

Presentation of Tulips

To contribute to the promotion of regional arts and culture, Daishi Bank proudly sponsors classical concerts and other events at Daishi Hall, a concert hall established within the head office. People in Niigata Prefecture enjoy wide use of this facility. In support of the musical careers of persons related to Niigata Prefecture.

　Daishi Bank permits the use of the hall free of charge for appropriate occasions.

Daishi Hall and the Life Up Concerts

▲Daishi Hall

Contributing to the Regional Communities

76 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Defined-contribution pension plans are corporate pensions offered in addition to public pensions. The key feature of these pension plans is that contributors (employees) decide how their pension assets are invested in consideration of their own expected needs in old age. 　Daishi Bank helps customers prepare for retirement. We design pension plans for companies to implement, offering

employee seminars and other forms of support. After they retire, customers can take advantage of our system for detailed consultation at branches. Daishi Bank is proud to support sound capital formation for private-sector employ-ees and employee-benefit schemes throughout Niigata Prefecture.

To add might to its efforts to grapple with environmental issues, in April 2010, Daishi Bank proclaimed the Daishi Bank Group Environmental Policy. Guided by this policy, Daishi Bank and our affiliates will strive to raise all directors’

and employees’ awareness of environmental issues, support customers’ environmental efforts through opera-tions, and lead efforts to preserve the precious environment.

In March 2010, Daishi Bank established a rating system for the environmental activities of each enterprise. Called Daishi Environmental Ratings, the rating system provides the basis for Daishi Environmentally Rated Finance, a system

for reduced interest rates according to each company’s environmental ranking. We offer a wide selection of service plans compliant with the interest subsidy system of the Ministry of the Environment.

Daishi Bank provides Niigata Prefecture’s agricultural producers, fisheries, and food processors with vital sales promotion support through the Daishi Food Seminars, a series of trade exhibition and seminar events. To date these events have produced over 500 business negotiations, contributing to the food businesses that are a vital mainstay of the Niigata economy. 　At the “Niigata Food and Ecology Exhibition and Semi-nar” in March 2010, a wide range of exhibitions and discus-

sions were held not only on the food industry but also on the environmental and new-energy industries, which are expected to enjoy solid growth in the near future. Daishi Bank is an active supporter of environ-mentally friendly businesses.

Daishi Bank dispatches employees to three cities in China: Shanghai, Dalian, and Hong Kong. These employees con-duct overseas support activities for Niigata-owned over-seas businesses, providing the latest local information and business know-how. 　In FY 2009, Daishi Bank launched a service catering to the consulting needs of customers currently doing business

with or seeking to do business with Chinese companies. Part-nering with the JETRO Niigata Trade Information Center, Daishi Bank offers a China Business Seminar twice a year.

▲China Business Seminar

▲Niigata Food and Ecology Exhibition 　and Seminar

The Research Center of Niigata is a think tank affiliated with Daishi Bank. With the collaboration of tourism organizations and administrative offices in each region of Niigata Prefec-ture, the Research Center of Niigata regularly conducts

questionnaire surveys while analyzing the current status and trends at hot-spring resort areas throughout the prefec-ture. These efforts play a role in energizing the economies of various regions.

For individual customers seeking loans to install environ-mentally friendly facilities in their homes or to purchase an

ecologically friendly car, Daishi Bank applies a lower than usual interest rate.

Financial services with roots in the regional community Environmental Measures　～ ～

Enhancing Defined-contribution Pension Operations The Daishi Bank Group’s Environmental Policy

Daishi Environmental Ratings and Daishi Environmentally Rated Loans

Business Seminars

Overseas Business Support

Stimulating Regional Development through Support for Tourism

Eco-friendly Car and Home Loans

To preserve the natural beauty of the Oze Plateau in perpe-tuity for future generations, since 2006 Daishi Bank manages the Oze Kiko Natural Environment Protection Fund

which contributes a part of its proceeds to the Oze Preser-vation Foundation. We will continue to support preservation of the Oze Plateau.

Nature Preservation Fund

To preserve the region’s lush, green environment for future generations, Daishi Bank is proud to take part in the Niigata Afforestation Support Project, a program by Niigata Prefec-ture. In October 2009, 400 Daishi Bank directors, employees, and family members took part in a tree-planting exercise at Daishi-no-Mori (“Daishi Forest”), located in Agamachi, Higashikanbara-gun, Niigata Prefecture.

　As a member of the regional community, Daishi Bank also enthusiastically joins the people of each area in volunteer cleanup activities.

Activities for Environmental Protection

▲Tree-planting activities ▲Volunteers harvesting rice on 　rice terraces

▲Volunteer cleanup of Ijimino Park　

【Basic Philosophy】

. Compliance

. Reducing environmental impact

. Supporting customers through excellence in banking

. Activities to preserve the environment

To preserve the abundant and beautiful natural environment of our native Niigata Prefecture and achieve a sustainable society, the Daishi Bank Group will work together to support customers who are working to preserve the environment, actively initiate measures to preserve the regional environment as a corporate citizen, and work toward solutions for environmental issues.

We comply with all environmental laws and regulations, taking due precautions to minimize environmental impact at all times.

We establish targets for reduction of environmental impact and undertake continuous activities to improve the environment by reducing energy, conserving resources, and implementing recycling.

We develop environmentally friendly products and services to offer comprehensive financial services to support customers making efforts to preserve the environment.

All directors and employees take steps to deepen their awareness of environmental issues and practice environmental awareness in all aspects of operations.

Code ofEnvironmentalConduct

Daishi Bank presents gifts of tulips, our official flower, to welfare facilities throughout Niigata Prefecture. Every spring and fall, Daishi Bank orders delivery of the flowers from bank locations to approximately 100 facilities prefecture-wide. A tradition since 1970, this practice has

taken hold as one of Daishi Bank’s most sustained contri-butions to society.

▲Presentation of Tulips

Presentation of Tulips

To contribute to the promotion of regional arts and culture, Daishi Bank proudly sponsors classical concerts and other events at Daishi Hall, a concert hall established within the head office. People in Niigata Prefecture enjoy wide use of this facility. In support of the musical careers of persons related to Niigata Prefecture.

　Daishi Bank permits the use of the hall free of charge for appropriate occasions.

Daishi Hall and the Life Up Concerts

▲Daishi Hall

Contributing to the Regional Communities

98 THE DAISHI BANK 2010 ANNUAL REPORT THE DAISHI BANK 2010 ANNUAL REPORT

Fundamental Policies Toward Compliance Basic Approach

Governance Framework

Compliance System

Corporate Governance

Four basic principles

Compliance

■Divisions

1

Customer trust is a bank’s greatest asset. To ensure that we continue to earn and maintain the trust of our customers, we at Daishi Bank must improve the soundness of management and win the confidence of the community based on our corporate ethics. The cornerstone of this effort is compli-ance.

　At Daishi Bank, compliance is our top priority. Adhering to four basic principles, all directors and employees are work-ing every day to establish a management constitution that is firmly grounded in the spirit of compliance.

Daishi Bank aims to be a bank that satisfies all of its stake-holders, from customers to shareholders. On the financial front, we are bolstering the soundness of our asset portfolio and the profitability of our operations. We realize that strengthening and fulfilling our corporate governance

regime is vital for our management. At the same time, we are enhancing audition and monitoring of management, enforcing thorough and consistent compliance, and improv-ing transparency.

As of the end of March 2010, the Board of Directors consists of 10 directors. In addition to basic affairs relating to management and implementing important business decisions, the Board of Directors monitors the status of business management by each director (nine directors as of June 24, 2010, with the approval of the 199th general meeting of shareholders). For important affairs of business management based on basic policies decided by the Board of Directors management, conferences established under the Board of Directors are held in principle once a week. 　Furthermore, to accelerate management decision-making and strengthen execution capability, Daishi Bank adopts a system of “operating directors.” Under this system, the Board of Directors elects a group of operating directors, each of whom is responsible for operations in their sector. In addition, a number of specialized commit-tees are established, including the Risk Management Com-mittee, the Asset Liability Management (ALM) Committee, and the Compliance Committee. 　Daishi Bank also adopts a system of auditors. The Board of Corporate Auditors consists of two statutory auditors and three external auditors; the latter are chosen for their ability to offer advice and suggestions from a broad perspective, based on extensive knowledge and experience in profes-sional fields. The corporate auditors monitor and supervise the performance of the directors by attending board meet-ings and other important meetings as well as reviewing important documents. 　The statutory auditors constantly monitor the status of Daishi Bank’s management, reporting and deliberating on their findings at the Board of Corporate Auditors, which

meets in principle once a month. Moreover, the Board of Corporate Auditors works closely with accounting auditors and Daishi Bank’s internal auditing organization, the Audit and Inspection Division, to monitor accounting auditors and ensure an efficient auditing process. 　The Board of Corporate Auditors also submits a general audit report every year to the Board of Directors, who carefully deliberates on the opinions given before suggest-ing policies in response. In order to assist the professional duties of the auditors, a specialized staff member is assigned, supporting the auditing duties of the external auditors. 　The Audit and Inspection Division is directly controlled by the Board of Directors with independence and neutrality from the target groups. They verify the appropriateness of compliance systems and various risk management systems. Every year, the Audit and Inspection Division conducts a comprehensive operational, system, and asset audit of all branches, head offices, centers, and Daishi Bank group companies, based on an audition policy and auditing plan approved by the Board of Directors. 　The results of these audits are reported to the Board of Directors and are used to examine and follow up on improvements to matters indicated in internal audits.　When a decision on legal matters is required, Daishi Bank calls on the third-party services of advisory legal attorneys. In addition, we have been accepting proposals related to the improvement of business operations through financial auditing from the accounting inspector KPMG Azusa & Co. at regular intervals.

Guided by our mission and adhering to our corporate ethics, we are establishing a thor-ough compliance framework through the development and execution of a practical com-pliance program.

2In operations, all directors and employees understand both the letter and spirit of the code of ethics regulated by the Japanese Bankers Association. The directors and employees of Daishi Bank work together to apply the code of this charter with common principles of con-duct.

3Through training and awareness-raising exercises, we build and instill a strong ethical consciousness and compliance-oriented mindset in our employees. We also work hard to produce a rigorous system for the verification of bank processes, strengthening measures to prevent violations of the law and other problems.

4We appropriately verify, evaluate, and report the status of compliance and of the imple-mentation of our compliance program. We make every effort to discover issues early and solve them promptly, with effective measures for correction of problems and prevention of their recurrence.

The Compliance Committee, whose activities are linked closely with everyday operations, meets in principle once a month to discuss important issues and the status of efforts on compliance.　The Compliance Office, established within the Manage-ment Administration Division, plans compliance measures, provides valuable support to each division, and offers guidance on compliance issues to each branch.

■ Training and EducationThe Compliance Manual is a set of standards distributed to all directors and employees. This manual is used for joint training exercises and compliance seminars within each branch and office.　Through development of an e-learning service and other training activities, we are broadening and deepening employee awareness of compliance issues.

■Main Divisions and BranchesEvery main branch manager and office manager serves as the compliance officer for that branch or office, and each assistant manager is responsible for checking on legal issues. Moreover, each branch has its own Compliance Committee, which examines conditions and implements measures to prevent compliance problems from arising, discover any problems at an early stage, and prevent any problems from recurring.

98 THE DAISHI BANK 2010 ANNUAL REPORT THE DAISHI BANK 2010 ANNUAL REPORT

Fundamental Policies Toward Compliance Basic Approach

Governance Framework

Compliance System

Corporate Governance

Four basic principles

Compliance

■Divisions

1

Customer trust is a bank’s greatest asset. To ensure that we continue to earn and maintain the trust of our customers, we at Daishi Bank must improve the soundness of management and win the confidence of the community based on our corporate ethics. The cornerstone of this effort is compli-ance.

　At Daishi Bank, compliance is our top priority. Adhering to four basic principles, all directors and employees are work-ing every day to establish a management constitution that is firmly grounded in the spirit of compliance.

Daishi Bank aims to be a bank that satisfies all of its stake-holders, from customers to shareholders. On the financial front, we are bolstering the soundness of our asset portfolio and the profitability of our operations. We realize that strengthening and fulfilling our corporate governance

regime is vital for our management. At the same time, we are enhancing audition and monitoring of management, enforcing thorough and consistent compliance, and improv-ing transparency.

As of the end of March 2010, the Board of Directors consists of 10 directors. In addition to basic affairs relating to management and implementing important business decisions, the Board of Directors monitors the status of business management by each director (nine directors as of June 24, 2010, with the approval of the 199th general meeting of shareholders). For important affairs of business management based on basic policies decided by the Board of Directors management, conferences established under the Board of Directors are held in principle once a week. 　Furthermore, to accelerate management decision-making and strengthen execution capability, Daishi Bank adopts a system of “operating directors.” Under this system, the Board of Directors elects a group of operating directors, each of whom is responsible for operations in their sector. In addition, a number of specialized commit-tees are established, including the Risk Management Com-mittee, the Asset Liability Management (ALM) Committee, and the Compliance Committee. 　Daishi Bank also adopts a system of auditors. The Board of Corporate Auditors consists of two statutory auditors and three external auditors; the latter are chosen for their ability to offer advice and suggestions from a broad perspective, based on extensive knowledge and experience in profes-sional fields. The corporate auditors monitor and supervise the performance of the directors by attending board meet-ings and other important meetings as well as reviewing important documents. 　The statutory auditors constantly monitor the status of Daishi Bank’s management, reporting and deliberating on their findings at the Board of Corporate Auditors, which

meets in principle once a month. Moreover, the Board of Corporate Auditors works closely with accounting auditors and Daishi Bank’s internal auditing organization, the Audit and Inspection Division, to monitor accounting auditors and ensure an efficient auditing process. 　The Board of Corporate Auditors also submits a general audit report every year to the Board of Directors, who carefully deliberates on the opinions given before suggest-ing policies in response. In order to assist the professional duties of the auditors, a specialized staff member is assigned, supporting the auditing duties of the external auditors. 　The Audit and Inspection Division is directly controlled by the Board of Directors with independence and neutrality from the target groups. They verify the appropriateness of compliance systems and various risk management systems. Every year, the Audit and Inspection Division conducts a comprehensive operational, system, and asset audit of all branches, head offices, centers, and Daishi Bank group companies, based on an audition policy and auditing plan approved by the Board of Directors. 　The results of these audits are reported to the Board of Directors and are used to examine and follow up on improvements to matters indicated in internal audits.　When a decision on legal matters is required, Daishi Bank calls on the third-party services of advisory legal attorneys. In addition, we have been accepting proposals related to the improvement of business operations through financial auditing from the accounting inspector KPMG Azusa & Co. at regular intervals.

Guided by our mission and adhering to our corporate ethics, we are establishing a thor-ough compliance framework through the development and execution of a practical com-pliance program.

2In operations, all directors and employees understand both the letter and spirit of the code of ethics regulated by the Japanese Bankers Association. The directors and employees of Daishi Bank work together to apply the code of this charter with common principles of con-duct.

3Through training and awareness-raising exercises, we build and instill a strong ethical consciousness and compliance-oriented mindset in our employees. We also work hard to produce a rigorous system for the verification of bank processes, strengthening measures to prevent violations of the law and other problems.

4We appropriately verify, evaluate, and report the status of compliance and of the imple-mentation of our compliance program. We make every effort to discover issues early and solve them promptly, with effective measures for correction of problems and prevention of their recurrence.

The Compliance Committee, whose activities are linked closely with everyday operations, meets in principle once a month to discuss important issues and the status of efforts on compliance.　The Compliance Office, established within the Manage-ment Administration Division, plans compliance measures, provides valuable support to each division, and offers guidance on compliance issues to each branch.

■ Training and EducationThe Compliance Manual is a set of standards distributed to all directors and employees. This manual is used for joint training exercises and compliance seminars within each branch and office.　Through development of an e-learning service and other training activities, we are broadening and deepening employee awareness of compliance issues.

■Main Divisions and BranchesEvery main branch manager and office manager serves as the compliance officer for that branch or office, and each assistant manager is responsible for checking on legal issues. Moreover, each branch has its own Compliance Committee, which examines conditions and implements measures to prevent compliance problems from arising, discover any problems at an early stage, and prevent any problems from recurring.

1110 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Risk Management

Systems for operational continuity

Risk Management Framework

■Market Risk Management

■Credit Risk Management

Risk Management

The advance of financial deregulation and globalization,　coupled with rapid progress in the IT sphere, has signifi-cantly broadened the scope of products and services that banks can handle. Each time financial institutions widen their circle of operations, however, the risks they confront grow more varied and complex.

To support a sound management base for its operations, and to win the confidence of its customers, Daishi Bank is strengthening its risk-management framework. As ever, Daishi Bank recognizes the critical importance of assess-ing. Through auditing of this process, profits corresponding to the risk are stably guaranteed, and the planning of the appropriate distribution of management resources is accomplished as a basic policy of risk management.

Organizationally, under this basic policy, Daishi Bank assigns specific jurisdiction over responses to each type of risk to specific sectors, while establishing a Management Administration Division that understands and manages risk comprehensively, cutting across organizational boundaries.

The Audit and Inspection Division, which is separated from the sectors it audits, conducts rigorous audits of the general sweep of bank operations, testing the appropriateness and effectiveness of Daishi Bank’s internal-control provisions.

Daishi Bank has instituted a number of committees to oversee risk management. The Risk Management Commit-tee supervises risk management and advances organiza-tional restructuring for the entire bank. The ALM Committee measures and analyzes risk, with the aim of controlling risk and securing stable revenues, and the Compliance Com-mittee pursues business management that thoroughly complies with laws and regulations. These committees work in concert to address and resolve a wide range of risk-related issues.

Under the risk-management system described above, Daishi Bank maintains sound control of its assets and conducts effective risk allocation, ensuring that assets are invested prudently for the effective management of risk capital.

Credit risk is the risk that a company or individual to whom a bank has lent money and who may fail to repay some or all of the principal and interest owed, usually due to bank-ruptcy or other deterioration of financial circumstances, resulting in a loss incurred by the bank.

Daishi Bank implements effective operation/management of credit risks by adhering to our credit risk policy estab-lished based on credit risk management.

The Credit Supervision Division and Management Admin-istration Division, which have general control over credit risk management, implement regulations to manage credit risk and plan/execute activities to analyze, evaluate and improve them.

Completely autonomous from the business promotion section, the Loan Examination Division strictly inspects finances and properly deals with problem loans as well as ensures the assets in regards to business improvement

support activities relating to business deals for the entire bank.

To foster strict and accurate credit examination, autono-mous assessment of lending is carried out at two levels, with local branches and the Loan Examination Division each conducting separate investigations. In addition, auditing by the Audit and Inspection Division ensures the accuracy and appropriateness of credit examination and autonomous assessment.

Daishi Bank is currently working to strengthen and enhance its credit risk management functions by quantify-ing credit risk* and setting credit risk limits, etc. that suit our capital adequacy.

Market risk is the risk that assets held by a bank may fall in value due to fluctuations in market factors, causing a bank to incur a loss. Such market factors include domestic and foreign interest rates, valuations on securities and foreign exchange rates.

Each fiscal year Daishi Bank establishes an asset liability management (ALM) policy to determine the quanti-tative level of risk that we deem acceptable and ensure stable earnings. Based on this policy, we set risk-taking and loss limits in the market sector. In addition, an ALM Commit-tee meets once a month, in principle to discuss important issues in market risk management. If the market sections encounter a serious incident, this framework ensures that the details are reported to management immediately.

The handling of market transactions is separated

between market administration (the Treasury and Capital Markets Division), office administration (the Securities and International Division) and integrated risk administration (the Management Administration Division). Daishi Bank is also constructing a framework of checks and balances to ensure that the auditing section can operate with maximum efficacy.

Daishi Bank is constantly working to strengthen and enhance its management of market risks. For example, we conduct daily VaR* measurements to ensure accurate assessment and analysis of risks associated with financial market fluctuations.

* VaR: Value at RiskA risk-management technique in which statistical methods are used to calculate the maximum loss that can occur within a given period.

*Quantification of credit risk The expression of the degree of risk in quantitative form, based on statistical treatment of data from various rating services.

■Liquidity Risk ManagementLiquidity risk is the combination of two related types of risk: fundraising risk and market liquidity risk. Fundraising risk is the risk that the financial institution may be unable to secure the necessary funds, or may unavoidably be obliged to do so at unusually high rates of interest. Market liquidity risk is the risk that the only market transactions available may be those with disadvantageous terms and prices.

Daishi Bank stipulates its methods of risk management in the operation guidance for liquidity risk management, which are used to control risk according to circumstances. Fundraising risk in particular is a fundamental risk for finan-cial institutions. Daishi Bank recognizes that the essence of

effective liquidity risk management lies in supporting a sound management constitution and maintaining the confi-dence of customers and financial markets. The Securities and International Division handles cash flow issues by carefully managing cash positions, while the Management Administration Division, our liquidity risk management arm, conducts monitoring to maintain a smooth cash flow.

In addition, we stipulate a set of countermeasures, which spell out how to respond in the face of unexpected events, while taking steps to implement a framework to maintain a stable cash flow.

■Operational Risk Management SystemOperational risk is the risk that Daishi Bank’s internal admin-istrative procedures, actions of directors or employees, or systems operations may be inappropriate, or that loss may occur due to external factors. At Daishi Bank, this risk consists of 1) administrative risk, 2) systems risk, and 3) other operational risk. The other operational risk is divided into seven subcategories and managed: 1) information-security risk, 2) legal risk, 3) human-error risk, 4) tangible-asset risk, 5) outsourcing risk, 6) reputational risk, and 7) other risk

To manage operational risk appropriately, the sector with jurisdiction for each risk collects and analyzes data on

losses that represent the realization of the risks in question, and the sector conducts examination and evaluation of the status of controls designed to minimize said risks. This assessment of Daishi Bank’s own risk-control status is called control self-assessment (CSA). Key risk indicators (KRIs) are gathered and analyzed to assess latent risks.

Tasked with managing operational risk, the Management Administration Division oversees the status of management of these risks and reports regularly to senior management via the Risk Management Committee. Through this system, appropriate responses are framed to minimize risk.

In the event of disasters or other unforeseen events, Daishi Bank must be able to continue to function with minimal disruption to customers and to bank management. To prepare for such contingencies, Daishi Bank is building a robust system to maintain continuity of operations. One aspect of these preparations is the formation of the Basic Policy on Operational Continuity.

The Basic Policy on Operational Continuity stipulates a system of responses that vary according to the nature of the disruptive event. For example, a Disaster Response Division is established to implement prompt recovery and continuity of operations in the event of a major natural disas-ter or system interruption.

(As of April 1, 2010)

Types of risk

Management regulations

Sectors responsiblefor each type of risk

ALM CommitteeDeliberation and monitoring of important issues in the general

management of assets and liabilities

Risk Management Committee

Deliberation and monitoring of important risk-management issues

Compliance Committee

Deliberation and monitoring of important compliance issues

Executive Committee

Board of Directors

All risks (comprehensive risk management)Operation guidelines for risk management

Management Administration Division (in general charge of risk management)

Audi

t and

Insp

ectio

n D

ivis

ion

(inte

rnal

mon

itorin

g se

ctor

s)

Boar

d of

Cor

pora

te A

udito

rs

Exte

rnal

aud

its (a

uditi

ng fi

rm)

Offices, Head Office Divisions, Group companies Operating sectors

Operational risk

Other operational risks

Operation guidelines for operational-risk management

Credit risk

Credit risk policy

Market riskOperation

guidelines for market risk

management

Liquidity riskOperation

guidelines for liquidity risk

managementAdministrative

risk

Operation guidelines for clerical-risk

management

Systemrisk

Operation guidelines for information

security management

Information-security risk

Operation guidelines for information-security risk

management

Legal risk

Legal-risk management regulations

Human-errorrisk

Operation guidelines for

human-error risk management

Tangible-assetrisk

Operation guidelines for tangible-asset

risk management

Outsourcingrisk

Operation guidelines for

outsourcing risk management

Reputationalrisk

Manual designated for external affairs

Credit Supervision

DivisionManagement Administration

Division

Systems Planning Division

Management Administration

Division

Management Administration

DivisionPersonnel Division

General Affairs

Division

Management Administration

Division

Planning and Coordination

Division

Operation Administration Division

Credit Supervision DivisionSecurities and International

Division

Management Administration Division

1110 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Risk Management

Systems for operational continuity

Risk Management Framework

■Market Risk Management

■Credit Risk Management

Risk Management

The advance of financial deregulation and globalization,　coupled with rapid progress in the IT sphere, has signifi-cantly broadened the scope of products and services that banks can handle. Each time financial institutions widen their circle of operations, however, the risks they confront grow more varied and complex.

To support a sound management base for its operations, and to win the confidence of its customers, Daishi Bank is strengthening its risk-management framework. As ever, Daishi Bank recognizes the critical importance of assess-ing. Through auditing of this process, profits corresponding to the risk are stably guaranteed, and the planning of the appropriate distribution of management resources is accomplished as a basic policy of risk management.

Organizationally, under this basic policy, Daishi Bank assigns specific jurisdiction over responses to each type of risk to specific sectors, while establishing a Management Administration Division that understands and manages risk comprehensively, cutting across organizational boundaries.

The Audit and Inspection Division, which is separated from the sectors it audits, conducts rigorous audits of the general sweep of bank operations, testing the appropriateness and effectiveness of Daishi Bank’s internal-control provisions.

Daishi Bank has instituted a number of committees to oversee risk management. The Risk Management Commit-tee supervises risk management and advances organiza-tional restructuring for the entire bank. The ALM Committee measures and analyzes risk, with the aim of controlling risk and securing stable revenues, and the Compliance Com-mittee pursues business management that thoroughly complies with laws and regulations. These committees work in concert to address and resolve a wide range of risk-related issues.

Under the risk-management system described above, Daishi Bank maintains sound control of its assets and conducts effective risk allocation, ensuring that assets are invested prudently for the effective management of risk capital.

Credit risk is the risk that a company or individual to whom a bank has lent money and who may fail to repay some or all of the principal and interest owed, usually due to bank-ruptcy or other deterioration of financial circumstances, resulting in a loss incurred by the bank.

Daishi Bank implements effective operation/management of credit risks by adhering to our credit risk policy estab-lished based on credit risk management.

The Credit Supervision Division and Management Admin-istration Division, which have general control over credit risk management, implement regulations to manage credit risk and plan/execute activities to analyze, evaluate and improve them.

Completely autonomous from the business promotion section, the Loan Examination Division strictly inspects finances and properly deals with problem loans as well as ensures the assets in regards to business improvement

support activities relating to business deals for the entire bank.

To foster strict and accurate credit examination, autono-mous assessment of lending is carried out at two levels, with local branches and the Loan Examination Division each conducting separate investigations. In addition, auditing by the Audit and Inspection Division ensures the accuracy and appropriateness of credit examination and autonomous assessment.

Daishi Bank is currently working to strengthen and enhance its credit risk management functions by quantify-ing credit risk* and setting credit risk limits, etc. that suit our capital adequacy.

Market risk is the risk that assets held by a bank may fall in value due to fluctuations in market factors, causing a bank to incur a loss. Such market factors include domestic and foreign interest rates, valuations on securities and foreign exchange rates.

Each fiscal year Daishi Bank establishes an asset liability management (ALM) policy to determine the quanti-tative level of risk that we deem acceptable and ensure stable earnings. Based on this policy, we set risk-taking and loss limits in the market sector. In addition, an ALM Commit-tee meets once a month, in principle to discuss important issues in market risk management. If the market sections encounter a serious incident, this framework ensures that the details are reported to management immediately.

The handling of market transactions is separated

between market administration (the Treasury and Capital Markets Division), office administration (the Securities and International Division) and integrated risk administration (the Management Administration Division). Daishi Bank is also constructing a framework of checks and balances to ensure that the auditing section can operate with maximum efficacy.

Daishi Bank is constantly working to strengthen and enhance its management of market risks. For example, we conduct daily VaR* measurements to ensure accurate assessment and analysis of risks associated with financial market fluctuations.

* VaR: Value at RiskA risk-management technique in which statistical methods are used to calculate the maximum loss that can occur within a given period.

*Quantification of credit risk The expression of the degree of risk in quantitative form, based on statistical treatment of data from various rating services.

■Liquidity Risk ManagementLiquidity risk is the combination of two related types of risk: fundraising risk and market liquidity risk. Fundraising risk is the risk that the financial institution may be unable to secure the necessary funds, or may unavoidably be obliged to do so at unusually high rates of interest. Market liquidity risk is the risk that the only market transactions available may be those with disadvantageous terms and prices.

Daishi Bank stipulates its methods of risk management in the operation guidance for liquidity risk management, which are used to control risk according to circumstances. Fundraising risk in particular is a fundamental risk for finan-cial institutions. Daishi Bank recognizes that the essence of

effective liquidity risk management lies in supporting a sound management constitution and maintaining the confi-dence of customers and financial markets. The Securities and International Division handles cash flow issues by carefully managing cash positions, while the Management Administration Division, our liquidity risk management arm, conducts monitoring to maintain a smooth cash flow.

In addition, we stipulate a set of countermeasures, which spell out how to respond in the face of unexpected events, while taking steps to implement a framework to maintain a stable cash flow.

■Operational Risk Management SystemOperational risk is the risk that Daishi Bank’s internal admin-istrative procedures, actions of directors or employees, or systems operations may be inappropriate, or that loss may occur due to external factors. At Daishi Bank, this risk consists of 1) administrative risk, 2) systems risk, and 3) other operational risk. The other operational risk is divided into seven subcategories and managed: 1) information-security risk, 2) legal risk, 3) human-error risk, 4) tangible-asset risk, 5) outsourcing risk, 6) reputational risk, and 7) other risk

To manage operational risk appropriately, the sector with jurisdiction for each risk collects and analyzes data on

losses that represent the realization of the risks in question, and the sector conducts examination and evaluation of the status of controls designed to minimize said risks. This assessment of Daishi Bank’s own risk-control status is called control self-assessment (CSA). Key risk indicators (KRIs) are gathered and analyzed to assess latent risks.

Tasked with managing operational risk, the Management Administration Division oversees the status of management of these risks and reports regularly to senior management via the Risk Management Committee. Through this system, appropriate responses are framed to minimize risk.

In the event of disasters or other unforeseen events, Daishi Bank must be able to continue to function with minimal disruption to customers and to bank management. To prepare for such contingencies, Daishi Bank is building a robust system to maintain continuity of operations. One aspect of these preparations is the formation of the Basic Policy on Operational Continuity.

The Basic Policy on Operational Continuity stipulates a system of responses that vary according to the nature of the disruptive event. For example, a Disaster Response Division is established to implement prompt recovery and continuity of operations in the event of a major natural disas-ter or system interruption.

(As of April 1, 2010)

Types of risk

Management regulations

Sectors responsiblefor each type of risk

ALM CommitteeDeliberation and monitoring of important issues in the general

management of assets and liabilities

Risk Management Committee

Deliberation and monitoring of important risk-management issues

Compliance Committee

Deliberation and monitoring of important compliance issues

Executive Committee

Board of Directors

All risks (comprehensive risk management)Operation guidelines for risk management

Management Administration Division (in general charge of risk management)

Audi

t and

Insp

ectio

n D

ivis

ion

(inte

rnal

mon

itorin

g se

ctor

s)

Boar

d of

Cor

pora

te A

udito

rs

Exte

rnal

aud

its (a

uditi

ng fi

rm)

Offices, Head Office Divisions, Group companies Operating sectors

Operational risk

Other operational risks

Operation guidelines for operational-risk management

Credit risk

Credit risk policy

Market riskOperation

guidelines for market risk

management

Liquidity riskOperation

guidelines for liquidity risk

managementAdministrative

risk

Operation guidelines for clerical-risk

management

Systemrisk

Operation guidelines for information

security management

Information-security risk

Operation guidelines for information-security risk

management

Legal risk

Legal-risk management regulations

Human-errorrisk

Operation guidelines for

human-error risk management

Tangible-assetrisk

Operation guidelines for tangible-asset

risk management

Outsourcingrisk

Operation guidelines for

outsourcing risk management

Reputationalrisk

Manual designated for external affairs

Credit Supervision

DivisionManagement Administration

Division

Systems Planning Division

Management Administration

Division

Management Administration

DivisionPersonnel Division

General Affairs

Division

Management Administration

Division

Planning and Coordination

Division

Operation Administration Division

Credit Supervision DivisionSecurities and International

Division

Management Administration Division

1312 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Years ended March 31, 2009 and 2010

Note : The translations of the Japanese yen amounts into US dollars are using the prevailing exchange rate at March 31,2010, which was ￥93.04 to US $1.

Cash and due from banks Call loans and bills bought Monetary claims bought Trading account securities Securities Loans and bills discounted Foreign exchanges Other assets Property, plant and equipment Intangible assets Deferred tax assets Customers' liabilities for acceptances and guarantees Allowance for loan losses Allowance for investment loss

Total Assets

$ 1,858,073 140,000 494,821

56,941 17,463,632 26,853,824

44,895 898,511 561,233

24,746 108,280 140,406

(261,893)(6,588)

$ 48,376,884

¥ 172,875 13,025 46,038

5,297 1,624,816 2,498,479

4,177 83,597 52,217

2,302 10,074 13,063

(24,366)(612)

¥ 4,500,985

¥ 186,603 ----

62,643 5,317

1,467,261 2,478,514

5,297 82,548 52,457

1,662 23,083 12,766

(28,336)(28)

¥ 4,349,791

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009Assets

Deposits and Negotiable certificates of deposit Payables under securities lending transactions Borrowed money Foreign exchanges Other liabilities Provision for directors' bonuses Provision for retirement benefits Provision for directors' retirement benefits Provision for reimbursement of deposits Provision for contingent loss Reserves under special laws Deferred tax liabilities Deferred tax liabilities for land revaluation Negative goodwill Acceptances and guarantees

Liabilities

Total Liabilities

$ 43,766,929 419,042 680,043

1,353 531,007

882 154,401

7,032 4,314 4,774

216 412

88,438 1,240

140,406

$ 45,800,496

¥ 4,072,075 38,987 63,271

125 49,404

82 14,365

654 401 444

20 38

8,228 115

13,063

¥ 4,261,278

¥ 3,906,285 18,656

130,252 152

43,359 77

12,999 567 393 370

24 34

8,414 173

12,766

¥ 4,134,529

Capital stock Authorized-576,999 thousand shares, Issued-370,079 thousand sharesCapital surplus Retained earnings Treasury stock Shareholders' equityValuation difference on available-for-sale securities Deferred gains or losses on hedges Revaluation reserve for land Valuation and translation adjustments Minority interests

Total Net Assets

Net Assets

Total Liabilities and Net Assets

$ 352,289 200,475

1,547,533 (3,829)

2,096,468 230,182

(180)68,447

298,449 181,470

2,576,388

$ 48,376,884

¥ 32,776 18,652

143,982 (356)

195,055 21,416

(16)6,368

27,767 16,883

239,707

¥ 4,500,985

¥ 32,776 18,652

138,951 (344)

190,036 2,948

(93)6,474 9,330

15,895 215,262

¥ 4,349,791

Interest on loans and discountsInterest and dividends on securitiesOther interest income Fees and commissionsOther ordinary income Other income

Income

Total Income

$ 471,010 195,890

8,120 161,533 31,967

235,242

$ 1,103,765

¥ 43,822 18,225

755 15,029 2,974

21,886

¥ 102,694

¥ 47,525 19,846

1,297 15,543

5,430 23,494

¥ 113,139

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009

Interest on deposits Interest on borrowings and rediscountsOther interest expensesFees and commissions paymentsOther ordinary expenses General and administrative expenses Provision of allowance for loan losses Other expenses

Expenses

Total Expenses

$ 74,882 5,170 3,627

38,300 42,224

535,880 ----

253,998

$ 954,083

¥ 6,967 481 337

3,563 3,928

49,858 ----

23,631

¥ 88,767

¥ 9,996 701

2,103 3,421 5,065

48,878 5,207

24,746

¥ 100,121

Income before income taxes and minority interests Provision for income taxes: Income taxes-current Income taxes-deferred

Net income before minority interestsMinority interests in income

Net Income

$ 149,682

55,910 2,529

91,242 10,327

$ 80,914

¥ 13,926

5,201 235

8,489 960

¥ 7,528

¥ 13,017

6,023 (697)

7,691 1,014

¥ 6,677

Amounts Per Share of Capital Stock:Net income Cash dividends

$ 0.21 0.07

¥ 20.38 7.00

¥ 18.06 7.00

sralloD .S.UneY

Years ended March 31, 2009 and 2010

Consolidated Balance Sheets Consolidated Statements of Operations

1312 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Years ended March 31, 2009 and 2010

Note : The translations of the Japanese yen amounts into US dollars are using the prevailing exchange rate at March 31,2010, which was ￥93.04 to US $1.

Cash and due from banks Call loans and bills bought Monetary claims bought Trading account securities Securities Loans and bills discounted Foreign exchanges Other assets Property, plant and equipment Intangible assets Deferred tax assets Customers' liabilities for acceptances and guarantees Allowance for loan losses Allowance for investment loss

Total Assets

$ 1,858,073 140,000 494,821 56,941

17,463,632 26,853,824

44,895 898,511 561,233 24,746

108,280 140,406

(261,893)(6,588)

$ 48,376,884

¥ 172,875 13,025 46,038 5,297

1,624,816 2,498,479

4,177 83,597 52,217 2,302

10,074 13,063

(24,366)(612)

¥ 4,500,985

¥ 186,603 ----

62,643 5,317

1,467,261 2,478,514

5,297 82,548 52,457 1,662

23,083 12,766

(28,336)(28)

¥ 4,349,791

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009Assets

Deposits and Negotiable certificates of deposit Payables under securities lending transactions Borrowed money Foreign exchanges Other liabilities Provision for directors' bonuses Provision for retirement benefits Provision for directors' retirement benefits Provision for reimbursement of deposits Provision for contingent loss Reserves under special laws Deferred tax liabilities Deferred tax liabilities for land revaluation Negative goodwill Acceptances and guarantees

Liabilities

Total Liabilities

$ 43,766,929 419,042 680,043

1,353 531,007

882 154,401

7,032 4,314 4,774

216 412

88,438 1,240

140,406

$ 45,800,496

¥ 4,072,075 38,987 63,271

125 49,404

82 14,365

654 401 444 20 38

8,228 115

13,063

¥ 4,261,278

¥ 3,906,285 18,656

130,252 152

43,359 77

12,999 567 393 370 24 34

8,414 173

12,766

¥ 4,134,529

Capital stock Authorized-576,999 thousand shares, Issued-370,079 thousand sharesCapital surplus Retained earnings Treasury stock Shareholders' equityValuation difference on available-for-sale securities Deferred gains or losses on hedges Revaluation reserve for land Valuation and translation adjustments Minority interests

Total Net Assets

Net Assets

Total Liabilities and Net Assets

$ 352,289 200,475

1,547,533 (3,829)

2,096,468 230,182

(180)68,447

298,449 181,470

2,576,388

$ 48,376,884

¥ 32,776 18,652

143,982 (356)

195,055 21,416

(16)6,368

27,767 16,883

239,707

¥ 4,500,985

¥ 32,776 18,652

138,951 (344)

190,036 2,948

(93)6,474 9,330

15,895 215,262

¥ 4,349,791

Interest on loans and discountsInterest and dividends on securitiesOther interest income Fees and commissionsOther ordinary income Other income

Income

Total Income

$ 471,010 195,890

8,120 161,533

31,967 235,242

$ 1,103,765

¥ 43,822 18,225

755 15,029

2,974 21,886

¥ 102,694

¥ 47,525 19,846

1,297 15,543

5,430 23,494

¥ 113,139

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009

Interest on deposits Interest on borrowings and rediscountsOther interest expensesFees and commissions paymentsOther ordinary expenses General and administrative expenses Provision of allowance for loan losses Other expenses

Expenses

Total Expenses

$ 74,882 5,170 3,627

38,300 42,224

535,880 ----

253,998

$ 954,083

¥ 6,967 481 337

3,563 3,928

49,858 ----

23,631

¥ 88,767

¥ 9,996 701

2,103 3,421 5,065

48,878 5,207

24,746

¥ 100,121

Income before income taxes and minority interests Provision for income taxes: Income taxes-current Income taxes-deferred

Net income before minority interestsMinority interests in income

Net Income

$ 149,682

55,910 2,529

91,242 10,327

$ 80,914

¥ 13,926

5,201 235

8,489 960

¥ 7,528

¥ 13,017

6,023 (697)

7,691 1,014

¥ 6,677

Amounts Per Share of Capital Stock:Net income Cash dividends

$ 0.21 0.07

¥ 20.38 7.00

¥ 18.06 7.00

sralloD .S.UneY

Years ended March 31, 2009 and 2010

Consolidated Balance Sheets Consolidated Statements of Operations

1514 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Consolidated Statements of Shareholders' EquityYears Ended March 31, 2009 and 2010

¥ 15,192 ---- ---- ---- ---- ---- ----

703 703

¥ 6,776 ---- ---- ---- ---- ---- ----

(301)(301)

¥ (37)---- ---- ---- ---- ---- ----

(56)(56)

¥ 23,832 ---- ---- ---- ---- ---- ----

(20,883)(20,883)

¥ (110)---- ----

(358)125 ---- ---- ----

(233)

¥ 134,760 (2,772)6,677

---- (15)----

301 ----

4,191

¥ 18,652 ---- ---- ---- (0)---- ---- ---- (0)

Minorityinterests

Valuationdifference on

available-for-sale

securities

Deferredgains or losses onhedges

Revaluationreservefor land

Treasurystock

Retainedearnings

Capitalsurplus

Capitalstock

¥ 32,776 ---- ---- ---- ---- ---- ---- ---- ----

370,079 ---- ---- ---- ---- ---- ---- ---- ----

Shares ofCapital stock(Thousands)

Millions of Yen

Minorityinterests

Valuationdifference on

available-for-sale

securities

Deferredgains or

losses onhedges

Revaluationreservefor land

Treasurystock

Retainedearnings

Capitalsurplus

Capitalstock

Thousands of U.S. Dollars

Balance at March 31, 2008 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Net changes of items other than shareholders' equity Total changes of items during the period

¥ 15,895 ---- ---- ---- ---- ---- ---- ----

988 988

¥ 6,474 ---- ---- ---- ---- ---- ---- ----

(106)(106)

¥ (93)---- ---- ---- ---- ---- ---- ---- 76 76

¥ 2,948 ---- ---- ---- ---- ---- ---- ----

18,467 18,467

¥ (344)---- ----

(19)8

---- ---- ---- ----

(11)

¥ 138,951 (2,584)7,528

---- (1)----

106 (17)----

5,030

¥ 18,652 ---- ---- ----

0 ---- ---- ---- ----

0

¥ 32,776 ---- ---- ---- ---- ---- ---- ---- ---- ----

370,079 ---- ---- ---- ---- ---- ---- ---- ---- ----

Balance at March 31, 2009 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Change of scope of consolidation Net changes of items other than shareholders' equity Total changes of items during the period

¥ 16,883 ¥ 6,368 ¥ (16)¥ 21,416 ¥ (356)¥ 143,982 ¥ 18,652 ¥ 32,776 370,079 Balance at March 31, 2010

$ 170,845 ---- ---- ---- ---- ---- ---- ----

10,625 10,625

$ 69,593 ---- ---- ---- ---- ---- ---- ----

(1,146)(1,146)

$ (1,004)---- ---- ---- ---- ---- ---- ----

823 823

$ 31,695 ---- ---- ---- ---- ---- ---- ----

198,486 198,486

$ (3,704)---- ----

(213)88 ---- ---- ---- ----

(125)

$1,493,463 (27,781)80,914

---- (15)----

1,146 (192)

---- 54,070

$ 200,475 ---- ---- ----

0 ---- ---- ---- ----

0

$ 352,289 ---- ---- ---- ---- ---- ---- ---- ---- ----

Balance at March 31, 2009 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Change of scope of consolidation Net changes of items other than shareholders' equity Total changes of items during the period

$ 181,470 $ 68,447 $ (180)$ 230,182 $ (3,829)$1,547,533 $ 200,475 $ 352,289 Balance at March 31, 2010

Consolidated Statements of Cash Flows Years ended March 31, 2009 and 2010

Net cash provided by (used in) operating activities:Income before income taxes and minority interests Adjustments to reconcile income before provision for income taxesand minority interests to net cash provided by operating activities: Depreciation and amortization Impairment loss Amortization of negative goodwill Increase (decrease) in allowance for loan losses Increase (decrease) in allowance for investment losses Increase (decrease) in provision for contingent loss Increase (decrease) in provision for directors' bonuses Increase (decrease) in provision for retirement benefits Increase (decrease) in provision for director's retirement benefits Increase (decrease) in provision for reimbursement of deposits Gain on fund management Financing expenses Loss (gain) related to securities Foreign exchange losses (gains) Loss (gain) on disposal of noncurrent assets Net decrease (increase) in trading account securities Net decrease (increase) in loans and bills discounted Net increase (decrease) in deposit Net increase (decrease) in negotiable certificates of deposit Net increase (decrease) in borrowed money (excluding subordinated borrowings) Net decrease (increase) in deposit (excluding deposit paid to Bank of Japan) Net decrease (increase) in call loans Net increase (decrease) in call money Net increase (decrease) in payables under securities lending transactions Net decrease (increase) in foreign exchanges-assets Net increase (decrease) in foreign exchanges-liabilities Proceeds from fund management Payments for finance Other, net

sub-totalIncome taxes paid

Total adjustmentsNet cash provided by (used in) operating activities

$ 149,682

38,021 7,088

(1,013)(42,668)

6,278 788 50

14,685 936 88

(675,022)83,679 41,560

(19)1,990

211 (214,587)

1,151,503 630,419

(719,921)4,733

36,547 ----

218,518 12,044

(281)681,062 (71,478)75,115

1,430,011 (65,094)

1,215,234

$ 1,364,917

¥ 13,926

3,537 659 (94)

(3,969)584 73 4

1,366 87 8

(62,804)7,785 3,866

(1)185 19

(19,965)107,135 58,654

(66,981)440

3,400 ----

20,330 1,120

(26)63,366 (6,650)6,988

133,048 (6,056)

113,065

¥ 126,991

¥ 13,017

3,311 29

(86)3,921

(2,011)85

3 388

36 57

(68,669)12,801

3,253 (1)

669 (581)

(143,228)111,389

46,529 100,077

155 106,553

(2,847)(4,781)(1,866)

(184)70,684

(11,235)11,607

249,076 (6,297)

229,762

¥ 242,779

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009

Net increase (decrease) in cash and cash equivalentsCash and cash equivalents at beginning of the year

Cash and cash equivalents at the end of the year

(142,821)1,992,382

$ 1,849,561

(13,288)185,371

¥ 172,083

114,516 70,855

¥ 185,371

Net cash provided by (used in) financing activities:Cash dividends paidCash dividends paid to minority shareholdersPurchase of treasury stockProceeds from sales of treasury stock

Net cash provided by (used in) financing activities

(27,781)(262)(213)

69

$ (28,188)

(2,584)(24)(19)

6

¥ (2,622)

(2,772)(30)

(358)109

¥ (3,052)

Net cash provided by (used in) investment activities:Purchase of short-term investment securities Proceeds from sales of short-term investment securities Proceeds from redemption of securities Purchase of property, plant and equipmentPurchase of intangible assetsProceeds from sales of property, plant and equipmentProceeds from sales of intangible assets

Net cash provided by (used in) investment activities:

(4,086,030)1,025,763 1,632,027

(47,964)(13,755)10,386

0

$ (1,479,569)

(380,164)95,437

151,843 (4,462)(1,279)

966 0

¥ (137,659)

(546,891)211,768 213,869

(3,752)(379)172

2

¥ (125,211)

1514 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Consolidated Statements of Shareholders' EquityYears Ended March 31, 2009 and 2010

¥ 15,192 ---- ---- ---- ---- ---- ----

703 703

¥ 6,776 ---- ---- ---- ---- ---- ----

(301)(301)

¥ (37)---- ---- ---- ---- ---- ----

(56)(56)

¥ 23,832 ---- ---- ---- ---- ---- ----

(20,883)(20,883)

¥ (110)---- ----

(358)125 ---- ---- ----

(233)

¥ 134,760 (2,772)6,677

---- (15)----

301 ----

4,191

¥ 18,652 ---- ---- ---- (0)---- ---- ---- (0)

Minorityinterests

Valuationdifference on

available-for-sale

securities

Deferredgains or losses onhedges

Revaluationreservefor land

Treasurystock

Retainedearnings

Capitalsurplus

Capitalstock

¥ 32,776 ---- ---- ---- ---- ---- ---- ---- ----

370,079 ---- ---- ---- ---- ---- ---- ---- ----

Shares ofCapital stock(Thousands)

Millions of Yen

Minorityinterests

Valuationdifference on

available-for-sale

securities

Deferredgains or

losses onhedges

Revaluationreservefor land

Treasurystock

Retainedearnings

Capitalsurplus

Capitalstock

Thousands of U.S. Dollars

Balance at March 31, 2008 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Net changes of items other than shareholders' equity Total changes of items during the period

¥ 15,895 ---- ---- ---- ---- ---- ---- ----

988 988

¥ 6,474 ---- ---- ---- ---- ---- ---- ----

(106)(106)

¥ (93)---- ---- ---- ---- ---- ---- ---- 76 76

¥ 2,948 ---- ---- ---- ---- ---- ---- ----

18,467 18,467

¥ (344)---- ----

(19)8

---- ---- ---- ----

(11)

¥ 138,951 (2,584)7,528

---- (1)----

106 (17)----

5,030

¥ 18,652 ---- ---- ----

0 ---- ---- ---- ----

0

¥ 32,776 ---- ---- ---- ---- ---- ---- ---- ---- ----

370,079 ---- ---- ---- ---- ---- ---- ---- ---- ----

Balance at March 31, 2009 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Change of scope of consolidation Net changes of items other than shareholders' equity Total changes of items during the period

¥ 16,883 ¥ 6,368 ¥ (16)¥ 21,416 ¥ (356)¥ 143,982 ¥ 18,652 ¥ 32,776 370,079 Balance at March 31, 2010

$ 170,845 ---- ---- ---- ---- ---- ---- ----

10,625 10,625

$ 69,593 ---- ---- ---- ---- ---- ---- ----

(1,146)(1,146)

$ (1,004)---- ---- ---- ---- ---- ---- ----

823 823

$ 31,695 ---- ---- ---- ---- ---- ---- ----

198,486 198,486

$ (3,704)---- ----

(213)88 ---- ---- ---- ----

(125)

$1,493,463 (27,781)80,914

---- (15)----

1,146 (192)

---- 54,070

$ 200,475 ---- ---- ----

0 ---- ---- ---- ----

0

$ 352,289 ---- ---- ---- ---- ---- ---- ---- ---- ----

Balance at March 31, 2009 Dividends from surplus Net income Purchase of treasury stock Disposal of treasury stock Retirement of treasury stock Reversal of revaluation reserve for land Change of scope of consolidation Net changes of items other than shareholders' equity Total changes of items during the period

$ 181,470 $ 68,447 $ (180)$ 230,182 $ (3,829)$1,547,533 $ 200,475 $ 352,289 Balance at March 31, 2010

Consolidated Statements of Cash Flows Years ended March 31, 2009 and 2010

Net cash provided by (used in) operating activities:Income before income taxes and minority interests Adjustments to reconcile income before provision for income taxesand minority interests to net cash provided by operating activities: Depreciation and amortization Impairment loss Amortization of negative goodwill Increase (decrease) in allowance for loan losses Increase (decrease) in allowance for investment losses Increase (decrease) in provision for contingent loss Increase (decrease) in provision for directors' bonuses Increase (decrease) in provision for retirement benefits Increase (decrease) in provision for director's retirement benefits Increase (decrease) in provision for reimbursement of deposits Gain on fund management Financing expenses Loss (gain) related to securities Foreign exchange losses (gains) Loss (gain) on disposal of noncurrent assets Net decrease (increase) in trading account securities Net decrease (increase) in loans and bills discounted Net increase (decrease) in deposit Net increase (decrease) in negotiable certificates of deposit Net increase (decrease) in borrowed money (excluding subordinated borrowings) Net decrease (increase) in deposit (excluding deposit paid to Bank of Japan) Net decrease (increase) in call loans Net increase (decrease) in call money Net increase (decrease) in payables under securities lending transactions Net decrease (increase) in foreign exchanges-assets Net increase (decrease) in foreign exchanges-liabilities Proceeds from fund management Payments for finance Other, net

sub-totalIncome taxes paid

Total adjustmentsNet cash provided by (used in) operating activities

$ 149,682

38,021 7,088

(1,013)(42,668)

6,278 788

50 14,685

936 88

(675,022)83,679 41,560

(19)1,990

211 (214,587)

1,151,503 630,419

(719,921)4,733

36,547 ----

218,518 12,044

(281)681,062 (71,478)75,115

1,430,011 (65,094)

1,215,234

$ 1,364,917

¥ 13,926

3,537 659 (94)

(3,969)584

73 4

1,366 87

8 (62,804)

7,785 3,866

(1)185

19 (19,965)107,135

58,654 (66,981)

440 3,400

---- 20,330

1,120 (26)

63,366 (6,650)6,988

133,048 (6,056)

113,065

¥ 126,991

¥ 13,017

3,311 29

(86)3,921

(2,011)85

3 388

36 57

(68,669)12,801

3,253 (1)

669 (581)

(143,228)111,389

46,529 100,077

155 106,553

(2,847)(4,781)(1,866)

(184)70,684

(11,235)11,607

249,076 (6,297)

229,762

¥ 242,779

2010

Thousands of U.S. Dollars

2010Millions of Yen

2009

Net increase (decrease) in cash and cash equivalentsCash and cash equivalents at beginning of the year

Cash and cash equivalents at the end of the year

(142,821)1,992,382

$ 1,849,561

(13,288)185,371

¥ 172,083

114,516 70,855

¥ 185,371

Net cash provided by (used in) financing activities:Cash dividends paidCash dividends paid to minority shareholdersPurchase of treasury stockProceeds from sales of treasury stock

Net cash provided by (used in) financing activities

(27,781)(262)(213)

69

$ (28,188)

(2,584)(24)(19)

6

¥ (2,622)

(2,772)(30)

(358)109

¥ (3,052)

Net cash provided by (used in) investment activities:Purchase of short-term investment securities Proceeds from sales of short-term investment securities Proceeds from redemption of securities Purchase of property, plant and equipmentPurchase of intangible assetsProceeds from sales of property, plant and equipmentProceeds from sales of intangible assets

Net cash provided by (used in) investment activities:

(4,086,030)1,025,763 1,632,027

(47,964)(13,755)10,386

0

$ (1,479,569)

(380,164)95,437

151,843 (4,462)(1,279)

966 0

¥ (137,659)

(546,891)211,768 213,869

(3,752)(379)172

2

¥ (125,211)

1716 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Notes To Consolidated Financial StatementsMarch 31, 2009 and 2010

1. Basis of presenting consolidated financial statements

The Daishi Bank, Ltd., (the “Bank”) and its consolidated domestic subsidiaries maintain their official accounting records in Japanese yen in accordance with the provisions set forth in the Japanese Corporation Law, the Bank Law of Japan, and the Financial Instruments and Exchange Law, and in conformity with accounting principles and practices generally accepted in Japan (“Japanese GAAP”). Certain accounting principles and practices generally accepted in Japan are different from International Accounting Standards and standards in other countries in certain respects as to application and disclosure requirements. Accordingly, the accompanying consolidated financial statements are intended for use by those who are informed about Japanese accounting principles and practices.

The accompanying consolidated financial statements have been restructured and translated into English with some expanded descriptions and the inclusion of consolidated statements of stockholders’ equity from the consolidated financial statements of the Bank which were prepared in accordance with Japanese GAAP and filed with the appropriate Local Finance Bureau of the Ministry of Finance as required by the Financial Instruments and Exchange Law. Some supple-mentary information included in the statutory Japanese language consolidated financial statements, but not required for fair presentation, is not presented in the accompanying consolidated financial statements.

Amounts less than one million yen have been omitted. As a result, the totals in Japanese yen shown in the financial statements do not necessarily agree with the sum of the individual amounts.

The translations of the Japanese yen amounts into U.S. dollars are included solely for the convenience of the readers, using the prevailing exchange rate on March 31, 2010, which was ¥93.04 to U.S. $1. These convenience translations should not be construed as representations that the Japanese yen amounts have been, could have been, or could in the future be converted into U.S. dollars at this or any other rate of exchange.

2. Significant accounting policies ConsolidationThe consolidated financial statements include the accounts of the Bank and all of its significant subsidiaries (together, the“Group”). The number of consolidated subsidiaries as of March 31, 2010 and 2009 was 10 and 11, respectively. The Daishi Jimu Shuchu Co.,Ltd. was liquidated. All significant intercompany balances and transactions have been eliminated.

Cash and cash equivalents In preparing the consolidated statements of cash flows, cash and due from THE BANK OF JAPAN are considered to be cash and cash equivalents.

Trading account securities The Bank’s trading account securities are stated at fair market value, and unrealized gains or losses are recognized in the consolidated statements of income.

Realized gains or losses on sale of such securities are primarily computed using the moving-average cost.

SecuritiesAccording to the Japanese Accounting Standards for Financial Instruments, securities are classified as follows based on their intention of holdings: (a) securities held for trading purposes (hereafter, "trading securities"), (b) debt securities intended to be held to maturity (hereafter, "held-to-maturity debt securi-ties"), (c) equity securities issued by subsidiaries and affiliated companies, and (d) for all other securities that are not classified in any of the above categories (hereafter, "available-for-sale securities")　　

Trading securities are stated at fair market value. Gains and losses realized on disposal and unrealized gains and losses from market value fluctuations are recognized as gains or losses in the period of the change.

Held-to-maturity debt securities are stated at amortized cost.Equity securities issued by subsidiaries and affiliated

companies which are not consolidated or accounted for using the equity method are stated at moving-average cost.

Available-for-sale securities with available fair values are stated at fair value. Unrealized gains and unrealized losses on these securities are reported, net of applicable income taxes, as a separate component of net assets. Realized gains and losses on sale of such securities are computed using moving-average cost.

Other securities whose fair value is judged to be difficult to determine are stated at moving-average cost.

If there is significant decline in the market value of held-to-maturity debt securities, equity securities issued by unconsoli-dated subsidiaries and affiliated companies, and available-for-sale securities, such securities are stated at fair value and the difference between fair value and the carrying amount is recognized as loss in the period of the decline. If the fair value of equity securities issued by unconsolidated subsidiaries and affiliated companies not on the equity method is not readily available, such securities should be written down to net asset value with a corresponding charge in the income statement in the event that net asset value declines significantly. In these cases, such fair value or the net asset value will be the carrying amount of the securities at the beginning of the next year.

DerivativesDerivative financial instruments are stated at fair value and changes in the fair value are recognized as gains or losses unless derivative financial instruments are used for hedging purposes.

Property, plant and equipment (excluding lease assets)Property, plant and equipment are stated at cost less accumu-lated depreciation except for certain revalued land used for business operations as explained in Note 15.

Depreciation of property, plant and equipment is computed using the declining-balance method at rates based on the estimated useful lives of respective assets. The estimated useful lives of major items are as follows: Buildings; 10 – 50 years Others; 2 – 20 years

Intangible assets (excluding lease assets)Intangible assets are amortized on a straight-line depreciation.

Software for internal use is amortized on a straight-line basis over its estimated useful life (principally 5 years).

Lease assetsAmong “tangible fixed assets” and “intangible assets”, lease assets relating to finance leases which do not transfer ownership to lessees are amortized on the straight-line method over the lease term. For residual value, residual value guarantees decided upon based on lease contracts are shown at the aforementioned residual value guarantee amount, others are shown as zero.

Foreign currency translation Assets and liabilities denominated in foreign currencies are translated into Japanese yen at the exchange rates prevailing on the balance sheet date.

Allowance for loan losses For loans to insolvent customers who are undergoing bankruptcy or other collection proceeding or in a similar financial condition, allowance for loan losses is provided in the full amount of such loans, excluding the portion that is estimated to be recoverable due to available security interests or guarantees.

For the unsecured and unguaranteed portions of loans to customers not presently in the above circumstances but for which there is a high probability of so becoming, the allowance for loan losses is provided for estimated unrecoverable amounts determined after evaluating the customer’s overall financial conditions.

For loans to customers who are not yet legally and formally bankrupt but who are substantially bankrupt or customers whose credit terms are rescheduled or reconditioned and exceed the certain threshold, the Discounted Cash Flow Method is applied if cash flows on repayment of principals and collection of interest of the loan can be reasonably estimated.

The Discounted Cash Flow Method (the DCF Method) requires that the difference between the cash flows discounted by the original interest rate and the book value of the loan be provided as a reserve for possible loan losses. During the medium middle-term reform plan, the same method was used for reserves.

For other loans, allowance for loan losses are provided based on the rate of the Bank’s actual loan losses in the past.

All branches and other business related sections evaluate all loans in accordance with the self-assessment rule, and their evaluations are audited by the asset audit section, which is independent from branches and other business related sections, and the evaluations are revised as required based on the audits.

Also, consolidated subsidiaries provide for an allowance for loan losses. It consists of the estimated uncollectible amount with respect to identified doubtful accounts and an amount calculated mainly using the rate of actual loan losses in the past.

Loans to insolvent customers who are undergoing bankruptcy or other collection proceedings or in a similar

financial condition are stated net of estimated uncollectible amount equal to the full amount of such loans less the portion that is estimated to be recoverable due to available security interests or guarantees.

Such estimated uncollectible amounts directly deducted from receivables amounted to ¥26,571 million and ¥24,320 million ($261,400 thousand) at March 31, 2009 and 2010, respectively.

Provision for retirement benefitsThe Bank provides two types of post-employment benefit plans, funded lump-sum payment plans and funded non-contributory pension plans, under which all eligible employees are entitled to benefits based on the level of wages and salaries at the time of retirement or termination, length of service, and certain other factors.

Also, consolidated subsidiaries provide lump-sum payment plans and one of them provides cash balance plans.

The Bank contributed certain marketable equity securities to an employee retirement benefit trust.

Liabilities and expenses for employees’ retirement benefits are determined based on the amounts actuarially calculated using certain assumptions. The Bank and its consolidated subsidiaries provide reserve for employees’ severance and retirement benefits based on the estimated amounts of projected benefit obligation at the balance sheet date and the fair value of the plan assets at that date.

Prior service costs are recognized in profit and loss using the straight-line method over 10 years commencing with the year incurred.

Actuarial gains and losses are recognized in expenses using the straight-line method over 10 years commencing with the following period.

Allowance for investment lossAllowance for investment losses is provided for the estimated losses on investments based on the evaluation of the financial conditions of the investees.

Provision for directors’ retirement benefitsThe reserve for directors’ retirement benefits is appropriated in the amount of the portion of expected total retirement-benefit payment that is recognized as generated in the consolidated fiscal year under review, to provide for payment of retirement benefits to directors.

Provision for reimbursement of depositsReserves against refund of inactive bank accounts are prepared against repayment losses that may be incurred when the holders of inactive bank accounts with suspended liability appropriation demand repayment. These reserves are prepared in the amount of the estimated future repayment loss based on past repayment results.

Provision for directors’ bonuses Provision for directors’ bonuses is appropriated as the total amount of bonuses expected to be paid to directors within the current consolidated fiscal year.

1716 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Notes To Consolidated Financial StatementsMarch 31, 2009 and 2010

1. Basis of presenting consolidated financial statements

The Daishi Bank, Ltd., (the “Bank”) and its consolidated domestic subsidiaries maintain their official accounting records in Japanese yen in accordance with the provisions set forth in the Japanese Corporation Law, the Bank Law of Japan, and the Financial Instruments and Exchange Law, and in conformity with accounting principles and practices generally accepted in Japan (“Japanese GAAP”). Certain accounting principles and practices generally accepted in Japan are different from International Accounting Standards and standards in other countries in certain respects as to application and disclosure requirements. Accordingly, the accompanying consolidated financial statements are intended for use by those who are informed about Japanese accounting principles and practices.

The accompanying consolidated financial statements have been restructured and translated into English with some expanded descriptions and the inclusion of consolidated statements of stockholders’ equity from the consolidated financial statements of the Bank which were prepared in accordance with Japanese GAAP and filed with the appropriate Local Finance Bureau of the Ministry of Finance as required by the Financial Instruments and Exchange Law. Some supple-mentary information included in the statutory Japanese language consolidated financial statements, but not required for fair presentation, is not presented in the accompanying consolidated financial statements.

Amounts less than one million yen have been omitted. As a result, the totals in Japanese yen shown in the financial statements do not necessarily agree with the sum of the individual amounts.

The translations of the Japanese yen amounts into U.S. dollars are included solely for the convenience of the readers, using the prevailing exchange rate on March 31, 2010, which was ¥93.04 to U.S. $1. These convenience translations should not be construed as representations that the Japanese yen amounts have been, could have been, or could in the future be converted into U.S. dollars at this or any other rate of exchange.

2. Significant accounting policies ConsolidationThe consolidated financial statements include the accounts of the Bank and all of its significant subsidiaries (together, the“Group”). The number of consolidated subsidiaries as of March 31, 2010 and 2009 was 10 and 11, respectively. The Daishi Jimu Shuchu Co.,Ltd. was liquidated. All significant intercompany balances and transactions have been eliminated.

Cash and cash equivalents In preparing the consolidated statements of cash flows, cash and due from THE BANK OF JAPAN are considered to be cash and cash equivalents.

Trading account securities The Bank’s trading account securities are stated at fair market value, and unrealized gains or losses are recognized in the consolidated statements of income.

Realized gains or losses on sale of such securities are primarily computed using the moving-average cost.

SecuritiesAccording to the Japanese Accounting Standards for Financial Instruments, securities are classified as follows based on their intention of holdings: (a) securities held for trading purposes (hereafter, "trading securities"), (b) debt securities intended to be held to maturity (hereafter, "held-to-maturity debt securi-ties"), (c) equity securities issued by subsidiaries and affiliated companies, and (d) for all other securities that are not classified in any of the above categories (hereafter, "available-for-sale securities")　　

Trading securities are stated at fair market value. Gains and losses realized on disposal and unrealized gains and losses from market value fluctuations are recognized as gains or losses in the period of the change.

Held-to-maturity debt securities are stated at amortized cost.Equity securities issued by subsidiaries and affiliated

companies which are not consolidated or accounted for using the equity method are stated at moving-average cost.

Available-for-sale securities with available fair values are stated at fair value. Unrealized gains and unrealized losses on these securities are reported, net of applicable income taxes, as a separate component of net assets. Realized gains and losses on sale of such securities are computed using moving-average cost.

Other securities whose fair value is judged to be difficult to determine are stated at moving-average cost.

If there is significant decline in the market value of held-to-maturity debt securities, equity securities issued by unconsoli-dated subsidiaries and affiliated companies, and available-for-sale securities, such securities are stated at fair value and the difference between fair value and the carrying amount is recognized as loss in the period of the decline. If the fair value of equity securities issued by unconsolidated subsidiaries and affiliated companies not on the equity method is not readily available, such securities should be written down to net asset value with a corresponding charge in the income statement in the event that net asset value declines significantly. In these cases, such fair value or the net asset value will be the carrying amount of the securities at the beginning of the next year.

DerivativesDerivative financial instruments are stated at fair value and changes in the fair value are recognized as gains or losses unless derivative financial instruments are used for hedging purposes.

Property, plant and equipment (excluding lease assets)Property, plant and equipment are stated at cost less accumu-lated depreciation except for certain revalued land used for business operations as explained in Note 15.

Depreciation of property, plant and equipment is computed using the declining-balance method at rates based on the estimated useful lives of respective assets. The estimated useful lives of major items are as follows: Buildings; 10 – 50 years Others; 2 – 20 years

Intangible assets (excluding lease assets)Intangible assets are amortized on a straight-line depreciation.

Software for internal use is amortized on a straight-line basis over its estimated useful life (principally 5 years).

Lease assetsAmong “tangible fixed assets” and “intangible assets”, lease assets relating to finance leases which do not transfer ownership to lessees are amortized on the straight-line method over the lease term. For residual value, residual value guarantees decided upon based on lease contracts are shown at the aforementioned residual value guarantee amount, others are shown as zero.

Foreign currency translation Assets and liabilities denominated in foreign currencies are translated into Japanese yen at the exchange rates prevailing on the balance sheet date.

Allowance for loan losses For loans to insolvent customers who are undergoing bankruptcy or other collection proceeding or in a similar financial condition, allowance for loan losses is provided in the full amount of such loans, excluding the portion that is estimated to be recoverable due to available security interests or guarantees.

For the unsecured and unguaranteed portions of loans to customers not presently in the above circumstances but for which there is a high probability of so becoming, the allowance for loan losses is provided for estimated unrecoverable amounts determined after evaluating the customer’s overall financial conditions.

For loans to customers who are not yet legally and formally bankrupt but who are substantially bankrupt or customers whose credit terms are rescheduled or reconditioned and exceed the certain threshold, the Discounted Cash Flow Method is applied if cash flows on repayment of principals and collection of interest of the loan can be reasonably estimated.

The Discounted Cash Flow Method (the DCF Method) requires that the difference between the cash flows discounted by the original interest rate and the book value of the loan be provided as a reserve for possible loan losses. During the medium middle-term reform plan, the same method was used for reserves.

For other loans, allowance for loan losses are provided based on the rate of the Bank’s actual loan losses in the past.

All branches and other business related sections evaluate all loans in accordance with the self-assessment rule, and their evaluations are audited by the asset audit section, which is independent from branches and other business related sections, and the evaluations are revised as required based on the audits.

Also, consolidated subsidiaries provide for an allowance for loan losses. It consists of the estimated uncollectible amount with respect to identified doubtful accounts and an amount calculated mainly using the rate of actual loan losses in the past.

Loans to insolvent customers who are undergoing bankruptcy or other collection proceedings or in a similar

financial condition are stated net of estimated uncollectible amount equal to the full amount of such loans less the portion that is estimated to be recoverable due to available security interests or guarantees.

Such estimated uncollectible amounts directly deducted from receivables amounted to ¥26,571 million and ¥24,320 million ($261,400 thousand) at March 31, 2009 and 2010, respectively.

Provision for retirement benefitsThe Bank provides two types of post-employment benefit plans, funded lump-sum payment plans and funded non-contributory pension plans, under which all eligible employees are entitled to benefits based on the level of wages and salaries at the time of retirement or termination, length of service, and certain other factors.

Also, consolidated subsidiaries provide lump-sum payment plans and one of them provides cash balance plans.

The Bank contributed certain marketable equity securities to an employee retirement benefit trust.

Liabilities and expenses for employees’ retirement benefits are determined based on the amounts actuarially calculated using certain assumptions. The Bank and its consolidated subsidiaries provide reserve for employees’ severance and retirement benefits based on the estimated amounts of projected benefit obligation at the balance sheet date and the fair value of the plan assets at that date.

Prior service costs are recognized in profit and loss using the straight-line method over 10 years commencing with the year incurred.

Actuarial gains and losses are recognized in expenses using the straight-line method over 10 years commencing with the following period.

Allowance for investment lossAllowance for investment losses is provided for the estimated losses on investments based on the evaluation of the financial conditions of the investees.

Provision for directors’ retirement benefitsThe reserve for directors’ retirement benefits is appropriated in the amount of the portion of expected total retirement-benefit payment that is recognized as generated in the consolidated fiscal year under review, to provide for payment of retirement benefits to directors.

Provision for reimbursement of depositsReserves against refund of inactive bank accounts are prepared against repayment losses that may be incurred when the holders of inactive bank accounts with suspended liability appropriation demand repayment. These reserves are prepared in the amount of the estimated future repayment loss based on past repayment results.

Provision for directors’ bonuses Provision for directors’ bonuses is appropriated as the total amount of bonuses expected to be paid to directors within the current consolidated fiscal year.

1918 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

（1）Cash and due from banks（2）Monetary claims bought*2

（3）Securities Trading securities Held-to-maturity debt securities Other securities

（4）Loans Allowance for loan losses*2

Asset capital（1） Deposits（2） Negotiable deposit（3） Borrowed money

Total liabilities

Derivative transactions*3

Hedge accounting not appliedHedge accounting applied

Total derivative transactions

–– 31

––

669 ––

31,170 ¥ 31,872

(3,536)(0)

(95)(¥ 3,632)

–– (116)

(¥ 116)

Millions of Yen

Difference*1

Cash and due from banksMonetary claims boughtSecurities Held-to-maturity debt securities Those that are Japanese government bonds Japanese local government bonds Corporate bonds Other securities Those that are Japanese government bonds Japanese local government bonds Corporate bondsLoans

Total

¥ 123,15311,591

6,417

800

4,6171,000

261,238

156,277

31,67859,333

455,539¥ 857,939

―2,722

9,701

4,200

3,5711,930

289,890

111,160

27,72988,861

486,921¥ 789,236

―7,525

22,109

21,000

―1,109

390,513

219,492

48,656110,691426,746

¥ 846,894

―4,680

140

―

―140

86,675

34,700

15,12632,838

177,334¥ 268,830

――

12,000

12,000

――

407,981

269,000

89,75248,379

155,140¥ 575,122

―20,216

―

―

――

18,833

10,000

――

289,784¥ 328,833

Millions of Yen

Within 1year

1 to 3years

3 to 5years

5 to 7years

7 to 10years

Over 10years

(Note 1) The financial instruments whose fair value is judged to be difficult to determine are as follows. They are not included in “Assets (3) Other securities” in fair value information for financial instruments.

(Note 3) The scheduled repayment amount after the consoli-dated balance sheet date for borrowed money and other interest-bearing debt

Cash and due from banksOther

Cash and cash equivalents

Thousands ofU.S. Dollars

¥ 172,875 (791)

¥ 172,083

2009 2010 2010

Millions of Yen

¥ 186,603(1,232)

¥ 185,371

$ 1,858,073 (8,511)

$ 1,849,561

Provision for contingent loss The reserve for contingent liabilities is a reserve for unexpected or incidental losses not covered by the other reserves. Losses expected to occur in the future are estimated, and the amount deemed necessary is appropriated.

Reserves under the special lawsReserves under the special laws are reserves for financial products transaction liabilities in securities business consoli-dated domestic subsidiaries, and in order to compensate for any losses incurred with respect to securities futures, etc., are appro-priated at an amount calculated based on the establishment of article 46, provision 5 of the Financial Instruments and Exchange Law.

Accounting for certain lease transactions (Lessees)Among finance leases which do not transfer ownership to lessees for Daishi Bank and our subsidiaries as well as affiliates, etc., the standard accounting method is applied to those from consolidated fiscal year accounting beginning before April 1st, 2008 based on standard lease transactions.(Lessors)The standard accounting method is applied to finance leases which do not transfer ownership to lessees for lease business consolidated domestic subsidiaries, however finance leases which do not transfer ownership to lessees from consolidated fiscal year accounting beginning before April 1st, 2008 are appropriated at carrying values (after deducting accumulated depreciation) appropriate for fixed assets at the end of the previous consolidated fiscal year accounting for the first year of application for the following guidelines based on Item No.81 of Accounting Standards Implementation Guidelines for Lease Transactions (Corporate Accounting Standards Implementation Guidelines No.16, March 30, 2007) as the lease investment asset beginning-of-term carrying values, and equivalent interest amounts are distributed evenly according to the total amount for each term during the residual lease term.

Compared with the application of Item No.80 of the same implementation guidelines, the net income before tax and adjustments for the period was increased by ¥265 million.

Lease transaction revenue/expense appropriation standardsRevenue/expense appropriation standards concerning finance lease transactions depend on the appropriation method for proceeds and costs of sales at the time of lease charge acceptance.

Hedge accounting①Hedge accounting for interest rate riskAs for the hedge accounting method applied to hedging transactions for interest rate risk arising from financial assets and liabilities, the Bank applies deferred hedge accounting stipulated in “the Treatment for Accounting and Auditing of Application of Accounting Standard for Financial Instruments in Banking Industry” (JICPA Industry Audit Committee Report No.24). The Bank assesses the effectiveness of such hedge for offsetting changes in interest rate, by classifying the hedged items (such as deposits and loans) and the hedging instruments (such as interest rate swaps) by their maturity. The Bank assesses the effectiveness of such hedges for fixing cash flows

by verifying the correlation between the hedged items and the hedging instruments.

②Hedge accounting for exchange rate riskAs for the hedge accounting method applied to hedging transactions for exchange rate risk arising from foreign currency-denominated financial assets and liabilities, the Bank applies deferred hedge accounting stipulated in “the Treatment for Accounting and Auditing Concerning Accounting for Foreign Currency Transactions in Banking Industry” (JICPA Industry Audit Committee Report No.25).

The effectiveness of such hedge accounting is assessed by considering currency swap transactions, which are for the purpose of offsetting foreign exchange risks arising from foreign-currency-denominated financial assets and liabilities as hedge methods, and by verifying the existence of foreign currency-position of such hedging methods matching up to the foreign-currency-denominated assets and liabilities of the hedging objects.

Amounts per shareComputation of net income per share is based on the weighted-average number of capital shares outstanding during each year.

Cash dividends per share represent the actual amounts declared as applicable to the respective years.

Important item changes for standards for consolidated financial statements(Accounting standards relating to financial instruments)Beginning at the end of the current consolidated fiscal year, the “Accounting Standard for Financial Instruments” (ASBJ Statement No.10 2008.3.10) and “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No.19 2008.3.10) take effect.

Through this, in comparison with the previous methods securities increased by ¥18 million, deferred tax assets decreased by ¥7 million, the valuation difference on available-for-sale securities increased by ¥105 million, and the net income before tax and adjustments for the period increased by ¥154 million.

Effects on segment information are noted in the appropriate locations.Cash and cash equivalentsThe reconciliation of cash and due from banks in the consoli-dated balance sheets and cash and cash equivalents in the consolidated statements of cash flows for 2009 and 2010 is as follows:

3. Issues relating to fair value, etc. of financial instrumentsThe consolidated balance sheet amounts, fair values, and their

¥ 172,87546,038

13651,085

1,568,501

2,506,221¥ 4,344,858

3,962,870112,741

63,367¥ 4,138,978

23948

¥ 287

Fair value¥ 172,875

46,006

136 50,415

1,568,501 2,498,479

(23,428)2,475,051

¥ 4,312,985 3,959,333

112,741 63,271

¥ 4,135,346

239 164

¥ 404

Book value

*1 Income/loss on valuation is shown in the difference column.*2 General reserve for possible loan losses applicable to loans and reserve for possible

loan losses are subtracted. Since the reserve for possible loan losses applicable to monetary claims bought is of insignificant importance, it was directly reduced from the consolidated balance sheet amounts.

*3 Derivative transactions included for other assets/liabilities and transactions utilizing special financial swap processing are shown together.

*1 Non-listed stock that has no market value whose fair value is judged to be difficult to determine are not applicable to fair value disclosure.

*2 For the current consolidated fiscal year, ¥10 million in impairment processing for non-listed stocks was carried out.

*3 Among associated investments, associated assets such as non-listed stock whose fair value is judged to be difficult to determine are not applicable to fair value disclosure. Some association capital is included in “Other assets”.

(Note 2) The scheduled repayment amount after the consoli-dated balance sheet date for monetary claims and matured securities

①Listed stock*1*2 ②Associated investments, etc.*3

Total

Book value

Millions of Yen

¥ 4,4453,817

¥ 8,262

* Of loans, ¥80,685 million securities without expectation of repayment to be bankrupt, substantially bankrupt, and not to yet legally and formally be bankrupt, as well as ¥425,922 million without term for claims, etc. are not included.

Deposits*Negotiable depositBorrowed money

Total

¥ 3,496,210112,74139,371

¥ 3,648,323

413,940―

2,325¥ 416,265

47,870―

575¥ 48,445

101―

21,000¥ 21,101

1,211――

¥ 1,211

――――

Millions of Yen

Within 1year

1 to 3years

3 to 5years

5 to 7years

7 to 10years

Over 10years

* Of deposits, demand deposit is disclosed within “Within 1 year”.

4. Securities A．The following tables summarize acquisition costs, book

values, fair value, and other information of securities with available fair values as of March 31, 2009 and 2010:

(1) Trading securities

(2) Held-to-maturity debt securities

Book valueAmount of net unrealized

gains included in theincome statement

$ 58,409

584

Thousands ofU.S. Dollars

26

Millions of Yen

Book valueFair valueDifference

Thousands ofU.S. DollarsMillions of Yen

2010

2010$ 541,867

549,0657,198

¥ 5,4342010

54

¥ 5,4392009

¥ 44,02744,410

382

2009 2010¥ 50,415

51,085669

differences as of March 31, 2010 are as follows. Non-listed stock, etc. whose fair value is judged to be difficult to determine are not included in the following charts (see Note 1).

StocksBondsOther than stocks

and bonds

StocksBondsOther than stocks

and bonds

Total

(3) Available-for-sale securities

Acquisitioncost

Millions of Yen

StocksBondsOther than stocks

and bonds

Total

Total

Acquisitioncost

Millions of Yen

$ 730,10314,572,204

1,540,083$ 16,842,390

$ 226,114 168,249

(8,161)$ 386,202

$ 956,21814,740,453

1,531,921$ 17,228,593

Acquisitioncost Book value Difference

Thousands of U.S. Dollars

March 31, 2010：

March 31, 2010：

March 31, 2009：

¥ 70,8771,178,736

172,084¥ 1,421,698

¥ 10,940 1,117

(7,278)¥ 4,780

¥ 81,8181,179,853

164,806¥ 1,426,478

¥ 67,9281,355,797

143,289¥ 1,567,016

¥ 21,037 15,653

(759)¥ 35,932

¥ 88,9661,371,451

142,529¥ 1,602,948

Book value Difference

Book value Difference

1918 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

（1）Cash and due from banks（2）Monetary claims bought*2

（3）Securities Trading securities Held-to-maturity debt securities Other securities

（4）Loans Allowance for loan losses*2

Asset capital（1） Deposits（2） Negotiable deposit（3） Borrowed money

Total liabilities

Derivative transactions*3

Hedge accounting not appliedHedge accounting applied

Total derivative transactions

–– 31

––

669 ––

31,170 ¥ 31,872

(3,536)(0)

(95)(¥ 3,632)

–– (116)

(¥ 116)

Millions of Yen

Difference*1

Cash and due from banksMonetary claims boughtSecurities Held-to-maturity debt securities Those that are Japanese government bonds Japanese local government bonds Corporate bonds Other securities Those that are Japanese government bonds Japanese local government bonds Corporate bondsLoans

Total

¥ 123,15311,591

6,417

800

4,6171,000

261,238

156,277

31,67859,333

455,539¥ 857,939

―2,722

9,701

4,200

3,5711,930

289,890

111,160

27,72988,861

486,921¥ 789,236

―7,525

22,109

21,000

―1,109

390,513

219,492

48,656110,691426,746

¥ 846,894

―4,680

140

―

―140

86,675

34,700

15,12632,838

177,334¥ 268,830

――

12,000

12,000

――

407,981

269,000

89,75248,379

155,140¥ 575,122

―20,216

―

―

――

18,833

10,000

――

289,784¥ 328,833

Millions of Yen

Within 1year

1 to 3years

3 to 5years

5 to 7years

7 to 10years

Over 10years

(Note 1) The financial instruments whose fair value is judged to be difficult to determine are as follows. They are not included in “Assets (3) Other securities” in fair value information for financial instruments.

(Note 3) The scheduled repayment amount after the consoli-dated balance sheet date for borrowed money and other interest-bearing debt

Cash and due from banksOther

Cash and cash equivalents

Thousands ofU.S. Dollars

¥ 172,875 (791)

¥ 172,083

2009 2010 2010

Millions of Yen

¥ 186,603(1,232)

¥ 185,371

$ 1,858,073 (8,511)

$ 1,849,561

Provision for contingent loss The reserve for contingent liabilities is a reserve for unexpected or incidental losses not covered by the other reserves. Losses expected to occur in the future are estimated, and the amount deemed necessary is appropriated.

Reserves under the special lawsReserves under the special laws are reserves for financial products transaction liabilities in securities business consoli-dated domestic subsidiaries, and in order to compensate for any losses incurred with respect to securities futures, etc., are appro-priated at an amount calculated based on the establishment of article 46, provision 5 of the Financial Instruments and Exchange Law.

Accounting for certain lease transactions (Lessees)Among finance leases which do not transfer ownership to lessees for Daishi Bank and our subsidiaries as well as affiliates, etc., the standard accounting method is applied to those from consolidated fiscal year accounting beginning before April 1st, 2008 based on standard lease transactions.(Lessors)The standard accounting method is applied to finance leases which do not transfer ownership to lessees for lease business consolidated domestic subsidiaries, however finance leases which do not transfer ownership to lessees from consolidated fiscal year accounting beginning before April 1st, 2008 are appropriated at carrying values (after deducting accumulated depreciation) appropriate for fixed assets at the end of the previous consolidated fiscal year accounting for the first year of application for the following guidelines based on Item No.81 of Accounting Standards Implementation Guidelines for Lease Transactions (Corporate Accounting Standards Implementation Guidelines No.16, March 30, 2007) as the lease investment asset beginning-of-term carrying values, and equivalent interest amounts are distributed evenly according to the total amount for each term during the residual lease term.

Compared with the application of Item No.80 of the same implementation guidelines, the net income before tax and adjustments for the period was increased by ¥265 million.

Lease transaction revenue/expense appropriation standardsRevenue/expense appropriation standards concerning finance lease transactions depend on the appropriation method for proceeds and costs of sales at the time of lease charge acceptance.

Hedge accounting①Hedge accounting for interest rate riskAs for the hedge accounting method applied to hedging transactions for interest rate risk arising from financial assets and liabilities, the Bank applies deferred hedge accounting stipulated in “the Treatment for Accounting and Auditing of Application of Accounting Standard for Financial Instruments in Banking Industry” (JICPA Industry Audit Committee Report No.24). The Bank assesses the effectiveness of such hedge for offsetting changes in interest rate, by classifying the hedged items (such as deposits and loans) and the hedging instruments (such as interest rate swaps) by their maturity. The Bank assesses the effectiveness of such hedges for fixing cash flows

by verifying the correlation between the hedged items and the hedging instruments.

②Hedge accounting for exchange rate riskAs for the hedge accounting method applied to hedging transactions for exchange rate risk arising from foreign currency-denominated financial assets and liabilities, the Bank applies deferred hedge accounting stipulated in “the Treatment for Accounting and Auditing Concerning Accounting for Foreign Currency Transactions in Banking Industry” (JICPA Industry Audit Committee Report No.25).

The effectiveness of such hedge accounting is assessed by considering currency swap transactions, which are for the purpose of offsetting foreign exchange risks arising from foreign-currency-denominated financial assets and liabilities as hedge methods, and by verifying the existence of foreign currency-position of such hedging methods matching up to the foreign-currency-denominated assets and liabilities of the hedging objects.

Amounts per shareComputation of net income per share is based on the weighted-average number of capital shares outstanding during each year.

Cash dividends per share represent the actual amounts declared as applicable to the respective years.

Important item changes for standards for consolidated financial statements(Accounting standards relating to financial instruments)Beginning at the end of the current consolidated fiscal year, the “Accounting Standard for Financial Instruments” (ASBJ Statement No.10 2008.3.10) and “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No.19 2008.3.10) take effect.

Through this, in comparison with the previous methods securities increased by ¥18 million, deferred tax assets decreased by ¥7 million, the valuation difference on available-for-sale securities increased by ¥105 million, and the net income before tax and adjustments for the period increased by ¥154 million.

Effects on segment information are noted in the appropriate locations.Cash and cash equivalentsThe reconciliation of cash and due from banks in the consoli-dated balance sheets and cash and cash equivalents in the consolidated statements of cash flows for 2009 and 2010 is as follows:

3. Issues relating to fair value, etc. of financial instrumentsThe consolidated balance sheet amounts, fair values, and their

¥ 172,87546,038

13651,085

1,568,501

2,506,221¥ 4,344,858

3,962,870112,741

63,367¥ 4,138,978

23948

¥ 287

Fair value¥ 172,875

46,006

136 50,415

1,568,501 2,498,479

(23,428)2,475,051

¥ 4,312,985 3,959,333

112,741 63,271

¥ 4,135,346

239 164

¥ 404

Book value

*1 Income/loss on valuation is shown in the difference column.*2 General reserve for possible loan losses applicable to loans and reserve for possible

loan losses are subtracted. Since the reserve for possible loan losses applicable to monetary claims bought is of insignificant importance, it was directly reduced from the consolidated balance sheet amounts.

*3 Derivative transactions included for other assets/liabilities and transactions utilizing special financial swap processing are shown together.

*1 Non-listed stock that has no market value whose fair value is judged to be difficult to determine are not applicable to fair value disclosure.

*2 For the current consolidated fiscal year, ¥10 million in impairment processing for non-listed stocks was carried out.

*3 Among associated investments, associated assets such as non-listed stock whose fair value is judged to be difficult to determine are not applicable to fair value disclosure. Some association capital is included in “Other assets”.

(Note 2) The scheduled repayment amount after the consoli-dated balance sheet date for monetary claims and matured securities

①Listed stock*1*2 ②Associated investments, etc.*3

Total

Book value

Millions of Yen

¥ 4,4453,817

¥ 8,262

* Of loans, ¥80,685 million securities without expectation of repayment to be bankrupt, substantially bankrupt, and not to yet legally and formally be bankrupt, as well as ¥425,922 million without term for claims, etc. are not included.

Deposits*Negotiable depositBorrowed money

Total

¥ 3,496,210112,74139,371

¥ 3,648,323

413,940―

2,325¥ 416,265

47,870―

575¥ 48,445

101―

21,000¥ 21,101

1,211――

¥ 1,211

――――

Millions of Yen

Within 1year

1 to 3years

3 to 5years

5 to 7years

7 to 10years

Over 10years

* Of deposits, demand deposit is disclosed within “Within 1 year”.

4. Securities A．The following tables summarize acquisition costs, book

values, fair value, and other information of securities with available fair values as of March 31, 2009 and 2010:

(1) Trading securities

(2) Held-to-maturity debt securities

Book valueAmount of net unrealized

gains included in theincome statement

$ 58,409

584

Thousands ofU.S. Dollars

26

Millions of Yen

Book valueFair valueDifference

Thousands ofU.S. DollarsMillions of Yen

2010

2010$ 541,867

549,0657,198

¥ 5,4342010

54

¥ 5,4392009

¥ 44,02744,410

382

2009 2010¥ 50,415

51,085669

differences as of March 31, 2010 are as follows. Non-listed stock, etc. whose fair value is judged to be difficult to determine are not included in the following charts (see Note 1).

StocksBondsOther than stocks

and bonds

StocksBondsOther than stocks

and bonds

Total

(3) Available-for-sale securities

Acquisitioncost

Millions of Yen

StocksBondsOther than stocks

and bonds

Total

Total

Acquisitioncost

Millions of Yen

$ 730,10314,572,204

1,540,083$ 16,842,390

$ 226,114 168,249

(8,161)$ 386,202

$ 956,21814,740,453

1,531,921$ 17,228,593

Acquisitioncost Book value Difference

Thousands of U.S. Dollars

March 31, 2010：

March 31, 2010：

March 31, 2009：

¥ 70,8771,178,736

172,084¥ 1,421,698

¥ 10,940 1,117

(7,278)¥ 4,780

¥ 81,8181,179,853

164,806¥ 1,426,478

¥ 67,9281,355,797

143,289¥ 1,567,016

¥ 21,037 15,653

(759)¥ 35,932

¥ 88,9661,371,451

142,529¥ 1,602,948

Book value Difference

Book value Difference

2120 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Total sales of available-for-sale securities sold in the year ended March 31, 2009 amounted to ¥183,687 million and the related gains and losses amounted to ¥5,107 million and ¥3,989 million, respectively, and those sales in the year ended March 31, 2010 amounted to ¥89,256 million ($959,334 thousand) and the related gains and losses amounted to ¥2,010 million ($21,606 thousand) and ¥2,726 million ($29,301 thousand), respectively.

Difference betweenCost and FairValue on available-for-sale securities Deferred tax liability

Sub-total

Minority Interests

Valuation difference on Available-for-sale securities

Thousands ofU.S. Dollars

2010

Millions of Yen

(C) Swap:

Receive fixed – pay variable rateReceive variable – pay fixed rate

Option:SellBuy

¥ 40,90112,830

77,25976,997

¥ 231(147)

(318)276

$ 439,617137,908

830,390827,579

$ 2,492(1,582)

(3,419)2,968

Notional principal amount

Fair valueNotionalprincipalamount

Fair value

Millions of YenThousands ofU.S. Dollars

March 31, 2010: March 31, 2010:

Swap:Receive fixed – pay variable rateReceive variable – pay fixed rate

Option:SellBuy

Notionalprincipalamount

Fair value

Millions of Yen

March 31, 2009:

Currency Swap:Foreign exchange contract:

Sell Buy

Currency options:Sell Buy

Notional principal amount

Fair value

Millions of Yen

March 31, 2009:

(1) Interest rate-related transaction

(2) Foreign exchange-related transactions

Valuation difference on available-for-sale securities at March 31, 2009 and 2010 were were aswere as follows:

(B) Held-to-maturity debt securities sold in the year ended March 31, 2010 were ¥304 million and the related gain was ¥4 million.

(D)

Currency Swap:Foreign exchange contract:

Sell Buy

Currency options:Sell Buy

¥ 74,106

6,5426,580

142,260142,262

¥ 150

(94)139

(12,640)12,641

$ 796,496

70,31670,725

1,529,0291,529,043

$ 1,613

(1,017)1,503

(135,857)135,869

Notionalprincipal amount

Fair valueNotionalprincipalamount

Fair value

Millions of YenThousands ofU.S. Dollars

March 31, 2010: March 31, 2010:

Fair values of interest rate and currency swap contracts are estimated based on discounted cash flow method.

Derivative transactions for which hedge accounting is applied are excluded from the table above, because the Bank adopted the transitional treatments prescribed in the Industry Audit Committee Report No.24 and No.25.

5. Derivative financial instrumentsThe Bank engages in derivative transactions to mitigate interest rate risk and liquidity risk of foreign currencies in the normal course of asset-liability management (ALM), and to meet customers’ needs. The Bank established the ALM committee and Risk Control Team to assess derivative transactions and market risks surrounding these transactions according to the Bank’s policy regarding derivative transactions. The Risk Control Team analyzes risks related to derivative transactions and reports to the ALM committee for review every month.

The Bank’s consolidated subsidiaries did not engage in any derivative transactions for the years ended March 31, 2009 and 2010.

The following tables summarized the underlying notional principal amounts and fair values for outstanding derivative financial instruments by risk category and instrument type at March 31, 2009 and 2010:

¥ 29,16718,291

33,72733,429

¥ 160(68)

(60)26

¥ 91,909

4,4454,277

151,781151,761

¥ 190

(16)67

(11,537)11,537

6. Information for certain lease trans-actions

(Finance lease transactions)1. Finance lease transactions which do not transfer ownership to

lessees with account processing based on methods relating to standard lease transactions

(1) LesseesEquivalent lease property acquisition cost, equivalent accumulated depreciation expense, and equivalent of netbook value

•Tangible fixed assets

Due within 1 yearDue after 1 year but within 2 years Due after 2 years but within 3 years Due after 3 years but within 4 yearsDue after 4 years but within 5 yearsDue after 5 years

Total

2009¥ 255

262243214165150

¥ 1,293

2010¥ 367

353319264154104

¥ 1,563

2010$ 3,949

3,7953,4312,8431,6611,122

$16,803•Future minimum lease payments

•Equivalent of interest expense calculation method Computed using the straight-line method over the lease terms assuming no residual value.

•Equivalent of interest expense calculation method Computed using the interest rate method over the lease terms for the difference between acquisition cost and total lease payments, and the allocation method for each consolidated fiscal year accounting is appropriated using the interest method.

(2) Lessors　Not applicable

2. Lease–backed securities among lease investment assets, estimated residual value, and equivalent interest/dividends received values

3. Estimated receivables for lease–backed securities amounts after the consolidated balance sheet date regarding lease-backed securities and lease investment assets

(1) Lease credit

(2) Lease investment assets

•Lease payments, equivalent of depreciation expense, and equivalent of interest expense

¥ 35,932

(14,239)

21,692(276)

¥ 21,416

$ 386,202

(153,049)

233,153(2,971)

$ 230,182

2009 2010

(1,717)

3,062(113)

¥ 2,948

¥ 4,780

Equivalent acquisition costEquivalent accumulated depreciation expense

Equivalent of net book value

Thousands ofU.S. Dollars

¥ 25

15¥ 10

2009 2010 2010

Millions of Yen

¥ 58

36¥ 21

$ 277

162$ 115

Due within 1 yearDue after 1 year

Total

Thousands ofU.S. Dollars

¥ 37

¥ 11

2009 2010 2010

Millions of Yen

¥ 1011

¥ 21

$ 4177

$ 118

Lease paymentsEquivalent of depreciation expenseEquivalent of interest expense

Thousands ofU.S. Dollars

¥ 1010

0

2009 2010 2010

Millions of Yen

¥ 1414

0

$ 117114

3

Cost estimation residual value amountsEstimated residual valueEquivalent interest/dividends received values

Lease investment assets

Thousands ofU.S. Dollars

¥ 33,314 1,930

(5,431)¥ 29,812

2009 2010 2010

Millions of Yen

Thousands ofU.S. DollarsMillions of Yen

Due Within 1 yearDue after 1 year but within 2 years Due after 2 years but within 3 years Due after 3 years but within 4 yearsDue after 4 years but within 5 yearsDue after 5 years

Total

2009¥ 11,211

8,8676,4334,2352,1791,804

¥ 34,731

2010¥ 11,144

8,3826,1654,0232,0811,517

¥ 33,314

2010$ 119,779

90,09866,26743,24522,36716,305

$ 358,063

Thousands ofU.S. DollarsMillions of Yen

¥ 34,731 2,086

(5,954)¥ 30,864

$ 358,063 20,746

(58,380)$ 320,428

Loans on notesLoans on deedsBills discountedOverdraftsOther

Total

$ 1,127,12720,787,390

217,0994,638,503

83,703$ 26,853,824

Thousands ofU.S. Dollars

¥ 104,8671,934,058

20,198431,566

7,787¥ 2,498,479

2009 2010 2010

Millions of Yen

7. Loans and bills discounted Loans and bills discounted at March 31, 2009 and 2010 consisted of the following:

¥ 117,1591,851,608

28,149474,921

6,675

¥ 2,478,514

Due within 1 yearDue after 1 year

Total

$ 1,8172,539

$ 4,356

Thousands ofU.S. Dollars

¥ 169236

¥ 405

2009 2010 2010

Millions of Yen

¥ 176337

¥ 514

(Operating lease transactions)

1. LesseesNot applicable

2. LessorsFuture minimum lease receipts under non-cancelable finance and operating leases

2120 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Total sales of available-for-sale securities sold in the year ended March 31, 2009 amounted to ¥183,687 million and the related gains and losses amounted to ¥5,107 million and ¥3,989 million, respectively, and those sales in the year ended March 31, 2010 amounted to ¥89,256 million ($959,334 thousand) and the related gains and losses amounted to ¥2,010 million ($21,606 thousand) and ¥2,726 million ($29,301 thousand), respectively.

Difference betweenCost and FairValue on available-for-sale securities Deferred tax liability

Sub-total

Minority Interests

Valuation difference on Available-for-sale securities

Thousands ofU.S. Dollars

2010

Millions of Yen

(C) Swap:

Receive fixed – pay variable rateReceive variable – pay fixed rate

Option:SellBuy

¥ 40,90112,830

77,25976,997

¥ 231(147)

(318)276

$ 439,617137,908

830,390827,579

$ 2,492(1,582)

(3,419)2,968

Notional principal amount

Fair valueNotionalprincipalamount

Fair value

Millions of YenThousands ofU.S. Dollars

March 31, 2010: March 31, 2010:

Swap:Receive fixed – pay variable rateReceive variable – pay fixed rate

Option:SellBuy

Notionalprincipalamount

Fair value

Millions of Yen

March 31, 2009:

Currency Swap:Foreign exchange contract:

Sell Buy

Currency options:Sell Buy

Notional principal amount

Fair value

Millions of Yen

March 31, 2009:

(1) Interest rate-related transaction

(2) Foreign exchange-related transactions

Valuation difference on available-for-sale securities at March 31, 2009 and 2010 were were aswere as follows:

(B) Held-to-maturity debt securities sold in the year ended March 31, 2010 were ¥304 million and the related gain was ¥4 million.

(D)

Currency Swap:Foreign exchange contract:

Sell Buy

Currency options:Sell Buy

¥ 74,106

6,5426,580

142,260142,262

¥ 150

(94)139

(12,640)12,641

$ 796,496

70,31670,725

1,529,0291,529,043

$ 1,613

(1,017)1,503

(135,857)135,869

Notionalprincipal amount

Fair valueNotionalprincipalamount

Fair value

Millions of YenThousands ofU.S. Dollars

March 31, 2010: March 31, 2010:

Fair values of interest rate and currency swap contracts are estimated based on discounted cash flow method.

Derivative transactions for which hedge accounting is applied are excluded from the table above, because the Bank adopted the transitional treatments prescribed in the Industry Audit Committee Report No.24 and No.25.

5. Derivative financial instrumentsThe Bank engages in derivative transactions to mitigate interest rate risk and liquidity risk of foreign currencies in the normal course of asset-liability management (ALM), and to meet customers’ needs. The Bank established the ALM committee and Risk Control Team to assess derivative transactions and market risks surrounding these transactions according to the Bank’s policy regarding derivative transactions. The Risk Control Team analyzes risks related to derivative transactions and reports to the ALM committee for review every month.

The Bank’s consolidated subsidiaries did not engage in any derivative transactions for the years ended March 31, 2009 and 2010.

The following tables summarized the underlying notional principal amounts and fair values for outstanding derivative financial instruments by risk category and instrument type at March 31, 2009 and 2010:

¥ 29,16718,291

33,72733,429

¥ 160(68)

(60)26

¥ 91,909

4,4454,277

151,781151,761

¥ 190

(16)67

(11,537)11,537

6. Information for certain lease trans-actions

(Finance lease transactions)1. Finance lease transactions which do not transfer ownership to

lessees with account processing based on methods relating to standard lease transactions

(1) LesseesEquivalent lease property acquisition cost, equivalent accumulated depreciation expense, and equivalent of netbook value

•Tangible fixed assets

Due within 1 yearDue after 1 year but within 2 years Due after 2 years but within 3 years Due after 3 years but within 4 yearsDue after 4 years but within 5 yearsDue after 5 years

Total

2009¥ 255

262243214165150

¥ 1,293

2010¥ 367

353319264154104

¥ 1,563

2010$ 3,949

3,7953,4312,8431,6611,122

$16,803•Future minimum lease payments

•Equivalent of interest expense calculation method Computed using the straight-line method over the lease terms assuming no residual value.

•Equivalent of interest expense calculation method Computed using the interest rate method over the lease terms for the difference between acquisition cost and total lease payments, and the allocation method for each consolidated fiscal year accounting is appropriated using the interest method.

(2) Lessors　Not applicable

2. Lease–backed securities among lease investment assets, estimated residual value, and equivalent interest/dividends received values

3. Estimated receivables for lease–backed securities amounts after the consolidated balance sheet date regarding lease-backed securities and lease investment assets

(1) Lease credit

(2) Lease investment assets

•Lease payments, equivalent of depreciation expense, and equivalent of interest expense

¥ 35,932

(14,239)

21,692(276)

¥ 21,416

$ 386,202

(153,049)

233,153(2,971)

$ 230,182

2009 2010

(1,717)

3,062(113)

¥ 2,948

¥ 4,780

Equivalent acquisition costEquivalent accumulated depreciation expense

Equivalent of net book value

Thousands ofU.S. Dollars

¥ 25

15¥ 10

2009 2010 2010

Millions of Yen

¥ 58

36¥ 21

$ 277

162$ 115

Due within 1 yearDue after 1 year

Total

Thousands ofU.S. Dollars

¥ 37

¥ 11

2009 2010 2010

Millions of Yen

¥ 1011

¥ 21

$ 4177

$ 118

Lease paymentsEquivalent of depreciation expenseEquivalent of interest expense

Thousands ofU.S. Dollars

¥ 10100

2009 2010 2010

Millions of Yen

¥ 14140

$ 117114

3

Cost estimation residual value amountsEstimated residual valueEquivalent interest/dividends received values

Lease investment assets

Thousands ofU.S. Dollars

¥ 33,314 1,930

(5,431)¥ 29,812

2009 2010 2010

Millions of Yen

Thousands ofU.S. DollarsMillions of Yen

Due Within 1 yearDue after 1 year but within 2 years Due after 2 years but within 3 years Due after 3 years but within 4 yearsDue after 4 years but within 5 yearsDue after 5 years

Total

2009¥ 11,211

8,8676,4334,2352,1791,804

¥ 34,731

2010¥ 11,144

8,3826,1654,0232,0811,517

¥ 33,314

2010$ 119,779

90,09866,26743,24522,36716,305

$ 358,063

Thousands ofU.S. DollarsMillions of Yen

¥ 34,731 2,086

(5,954)¥ 30,864

$ 358,063 20,746

(58,380)$ 320,428

Loans on notesLoans on deedsBills discountedOverdraftsOther

Total

$ 1,127,12720,787,390

217,0994,638,503

83,703$ 26,853,824

Thousands ofU.S. Dollars

¥ 104,8671,934,058

20,198431,566

7,787¥ 2,498,479

2009 2010 2010

Millions of Yen

7. Loans and bills discounted Loans and bills discounted at March 31, 2009 and 2010 consisted of the following:

¥ 117,1591,851,608

28,149474,921

6,675

¥ 2,478,514

Due within 1 yearDue after 1 year

Total

$ 1,8172,539

$ 4,356

Thousands ofU.S. Dollars

¥ 169236

¥ 405

2009 2010 2010

Millions of Yen

¥ 176337

¥ 514

(Operating lease transactions)

1. LesseesNot applicable

2. LessorsFuture minimum lease receipts under non-cancelable finance and operating leases

2322 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

9. Borrowed moneyBorrowed money included subordinated loans totaling ¥21,000 million and ¥21,000 million ($213,783 thousand) at March 31, 2009 and 2010, respectively.

10. Assets PledgedAssets pledged as collateral and related liabilities at March 31, 2010 were as follows:

In addition, the following assets were pledged as collateral for settlement of exchange, short-term financial transaction, and forward exchange contracts.

Guaranty money deposited was included in other assets, and amounted to ¥548 million ($5,892 thousand) at March 31, 2010

Current depositsOrdinary depositsNegotiable certificates of

depositsSavings depositsDeposits at noticeTime depositsOther deposits

Total

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

Trading account securitiesSecurities

Total

Thousands ofU.S. Dollars

¥ 287 144,116

¥ 144,403

Millions of Yen

Assets pledged: Securities LoansRelated liabilities: Deposits Payables under securities lending transactionsBorrowed money

Thousands ofU.S. DollarsMillions of Yen

Non-accrual loans:Loans to borrowers under

bankruptcy proceedingsLoans past due six

months or more

Total non-accrual loans

Accrual loans past due overmore than three months

Restructured loans-adjustedthe terms in favor ofborrowers for financialassistance

$ 40,319

826,897$ 867,216

$ 2,146

$ 89,744

Thousands ofU.S. Dollars

¥ 3,751

76,934¥ 80,685

¥ 199

¥ 8,349

2009 2010 2010

Millions of Yen

Non-accrual loans, accrual loans past due over more than three months, and restructured loans at March 31, 2009 and 2010 were as follows:

11. Employee’s severance and pen-sion benefits

The Provision for retirement benefits included in the liability section of the consolidated balance sheets as of March 31, 2009 and 2010 consisted of the following:

13. Revaluation reserve for landPursuant to the Law concerning Revaluation of Land (the “Law”), land used for business operations was revalued at fair value at March 31, 1998. Due to the revaluation, land was appreciated by ¥21,889 million to ¥41,412 million at March 31, 1998. Net unrealized gain was classified in a separate compo-nent of stockholders’ equity, net of applicable income taxes, as

“Land revaluation reserve, net of tax” and in liabilities as “Deferred tax liabilities for land revaluation reserve” in the accompanying consolidated balance sheets. Under the Law, once after the Bank revalued the land, it is not permitted to revalue the land. Such unrealized revaluation loss at March 31, 2010 was ¥15,537 million ($166,997 thousand).

Included in the consolidated statements of operations for the years ended March 31, 2009 and 2010 are severance and retirement benefit expenses comprised of the following:

Service costs – benefits earned during the year

Interest cost on projected benefit obligation

Expected return on planassets

Amortization of priorservice cost

Amortization of actuarialdifferences

Other

Severance and retirement benefit expenses

Basic assumptions of employees’ retirement benefits calculation:

Thousands ofU.S. Dollars

¥ 1,252

922

(752)

(456)

2,133 169

¥ 3,269

$ 13,462

9,914

(8,083)

(4,906)

22,936 1,820

$ 35,144

2009 2010 2010

Millions of Yen

Discount rateExpected return rate of assetsAllocation basis of expect

retirement benefitsAmortization term of unrecognized

prior service costAmortization term of unrecognized

actuarial differences

2.0%0–3.5%

Fixed

10 years

10 years

2.0%0–3.5%

Fixed

10 years

10 years

2009 2010

Deferred tax assets:Allowance for loan losses

and write-off of claimsRetirement benefitsDepreciationOtherLess valuation allowance

Total deferred income tax assets

Deferred tax liabilities:Unrealized gains on

securities availablefor sale

Gain on contibution ofsecurities to employeeretierment benefit trust

Other

Total deferred income taxliabilities

Net deferred tax assets(liabilities)

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

¥ 4,379

79,530¥ 83,909

¥ 363

¥ 5,474

8. DepositsDeposits at March 31, 2009 and 2010 consisted of the following:

¥ 168,3651,801,097

54,08631,96117,947

1,688,704144,120

¥ 3,906,285

¥ 167,9721,876,989

112,74131,09919,077

1,701,757162,437

¥ 4,072,075

$ 1,805,38220,174,001

1,211,749334,255205,042

18,290,6051,745,892

$ 43,766,929

$ 3,107,991$ 766,874

$ 1,948,484$ 419,042$ 379,742

¥ 289,167¥ 71,350

¥ 181,286¥ 38,987¥ 35,331

$ 3,089 1,548,969

$ 1,552,058

¥ 1,210

915

(941)

(456)

1,558 126

¥ 2,412

12. Income taxes The Bank is subject to a number of taxes levied on income, which, in the aggregate, indicate a statutory rate in Japan of approximately 40.4% for the year ended March 31, 2009 and 2010.

The difference for the years ended March 31, 2009 and 2010 are not disclosed as permitted under Japanese accounting standards since the difference is not more than 5% of the statutory tax rate.

Significant components of deferred tax assets and liabilities at March 31, 2009 and 2010 were as follows:

¥ 17,652 6,648 1,559 4,420

(3,819)

26,461

(1,717)

(1,146)(549)

(3,413)

¥ 23,048

¥ 15,996 7,290 1,521 5,145

(3,945)

26,008

(14,239)

(1,076)(655)

(15,972)

¥ 10,036

$ 171,927 78,359 16,355 55,307

(42,408)

279,541

(153,049)

(11,574)(7,050)

(171,674)

$ 107,867

Projected benefit obligationPension assetsUnrecognized actuarial

differencesUnrecognized prior

service cost

Net amount recognized in theconsolidated balance sheets

Prepaid pension costs

Provision for retirement benefits

Thousands ofU.S. Dollars

¥ 47,497 (26,100)

(8,238)

1,207

14,365 ―

¥ 14,365

$ 510,504 (280,527)

(88,548)

12,973

154,401 ―

$ 154,401

2009 2010 2010

Millions of Yen

¥ 47,453 (24,384)

(12,073)

1,663

12,658 (340)

¥ 12,999

14. Long-lived AssetsThe Group recognized impairment losses for the years ended March 31, 2010 as follows:

The Bank policies for asset grouping are as follows. In principle, grouping is implemented at the smallest managerial accounting division level, individual branch offices. Grouping is also carried out at the asset level for assets scheduled for disposal and for inactive assets. The headquarters, operation centers, and welfare centers which are assets related to the entire Daishi Bank are treated as common assets.

The Bank also carries out grouping for consolidated subsid-iaries with impairment losses included using similar methods.

The recoverable value is calculated based on the higher amounts of the net selling price and the value in use. The net selling price is calculated, mainly, based on the real estate appraisal value. The value in use is calculated with 3.96% discounted from the future cash flow, with separate calculation methods for the above.

15. Accumulated depreciationAccumulated depreciation of Property, plant and equipment was ¥79,656 million as of March 31, 2009 and ¥79,131 million($850,515 thousand) as of March 31, 2010.

Niigata Pref.

Niigata Pref.

Saitama Pref.

Fukushima Pref.

Total

Thousands ofMillionsof Yen U.S. DollarsArea

Branch offices and other

Idle assets and other

Branch offices and other

Idle assets and other

Principal purpose

of use

Land and buildings

Land and buildings

Land and buildings

Land and buildings

Classification

$ 3,337

$ 2,783

$ 938

$ 29

$ 7,088

¥ 310

¥ 259

¥ 87

¥ 2

¥ 659

2322 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

9. Borrowed moneyBorrowed money included subordinated loans totaling ¥21,000 million and ¥21,000 million ($213,783 thousand) at March 31, 2009 and 2010, respectively.

10. Assets PledgedAssets pledged as collateral and related liabilities at March 31, 2010 were as follows:

In addition, the following assets were pledged as collateral for settlement of exchange, short-term financial transaction, and forward exchange contracts.

Guaranty money deposited was included in other assets, and amounted to ¥548 million ($5,892 thousand) at March 31, 2010

Current depositsOrdinary depositsNegotiable certificates of

depositsSavings depositsDeposits at noticeTime depositsOther deposits

Total

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

Trading account securitiesSecurities

Total

Thousands ofU.S. Dollars

¥ 287 144,116

¥ 144,403

Millions of Yen

Assets pledged: Securities LoansRelated liabilities: Deposits Payables under securities lending transactionsBorrowed money

Thousands ofU.S. DollarsMillions of Yen

Non-accrual loans:Loans to borrowers under

bankruptcy proceedingsLoans past due six

months or more

Total non-accrual loans

Accrual loans past due overmore than three months

Restructured loans-adjustedthe terms in favor ofborrowers for financialassistance

$ 40,319

826,897$ 867,216

$ 2,146

$ 89,744

Thousands ofU.S. Dollars

¥ 3,751

76,934¥ 80,685

¥ 199

¥ 8,349

2009 2010 2010

Millions of Yen

Non-accrual loans, accrual loans past due over more than three months, and restructured loans at March 31, 2009 and 2010 were as follows:

11. Employee’s severance and pen-sion benefits

The Provision for retirement benefits included in the liability section of the consolidated balance sheets as of March 31, 2009 and 2010 consisted of the following:

13. Revaluation reserve for landPursuant to the Law concerning Revaluation of Land (the “Law”), land used for business operations was revalued at fair value at March 31, 1998. Due to the revaluation, land was appreciated by ¥21,889 million to ¥41,412 million at March 31, 1998. Net unrealized gain was classified in a separate compo-nent of stockholders’ equity, net of applicable income taxes, as

“Land revaluation reserve, net of tax” and in liabilities as “Deferred tax liabilities for land revaluation reserve” in the accompanying consolidated balance sheets. Under the Law, once after the Bank revalued the land, it is not permitted to revalue the land. Such unrealized revaluation loss at March 31, 2010 was ¥15,537 million ($166,997 thousand).

Included in the consolidated statements of operations for the years ended March 31, 2009 and 2010 are severance and retirement benefit expenses comprised of the following:

Service costs – benefits earned during the year

Interest cost on projected benefit obligation

Expected return on planassets

Amortization of priorservice cost

Amortization of actuarialdifferences

Other

Severance and retirement benefit expenses

Basic assumptions of employees’ retirement benefits calculation:

Thousands ofU.S. Dollars

¥ 1,252

922

(752)

(456)

2,133 169

¥ 3,269

$ 13,462

9,914

(8,083)

(4,906)

22,936 1,820

$ 35,144

2009 2010 2010

Millions of Yen

Discount rateExpected return rate of assetsAllocation basis of expect

retirement benefitsAmortization term of unrecognized

prior service costAmortization term of unrecognized

actuarial differences

2.0%0–3.5%

Fixed

10 years

10 years

2.0%0–3.5%

Fixed

10 years

10 years

2009 2010

Deferred tax assets:Allowance for loan losses

and write-off of claimsRetirement benefitsDepreciationOtherLess valuation allowance

Total deferred income tax assets

Deferred tax liabilities:Unrealized gains on

securities availablefor sale

Gain on contibution ofsecurities to employeeretierment benefit trust

Other

Total deferred income taxliabilities

Net deferred tax assets(liabilities)

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

¥ 4,379

79,530¥ 83,909

¥ 363

¥ 5,474

8. DepositsDeposits at March 31, 2009 and 2010 consisted of the following:

¥ 168,3651,801,097

54,08631,96117,947

1,688,704144,120

¥ 3,906,285

¥ 167,9721,876,989

112,74131,09919,077

1,701,757162,437

¥ 4,072,075

$ 1,805,38220,174,001

1,211,749334,255205,042

18,290,6051,745,892

$ 43,766,929

$ 3,107,991$ 766,874

$ 1,948,484$ 419,042$ 379,742

¥ 289,167¥ 71,350

¥ 181,286¥ 38,987¥ 35,331

$ 3,089 1,548,969

$ 1,552,058

¥ 1,210

915

(941)

(456)

1,558 126

¥ 2,412

12. Income taxes The Bank is subject to a number of taxes levied on income, which, in the aggregate, indicate a statutory rate in Japan of approximately 40.4% for the year ended March 31, 2009 and 2010.

The difference for the years ended March 31, 2009 and 2010 are not disclosed as permitted under Japanese accounting standards since the difference is not more than 5% of the statutory tax rate.

Significant components of deferred tax assets and liabilities at March 31, 2009 and 2010 were as follows:

¥ 17,652 6,648 1,559 4,420

(3,819)

26,461

(1,717)

(1,146)(549)

(3,413)

¥ 23,048

¥ 15,996 7,290 1,521 5,145

(3,945)

26,008

(14,239)

(1,076)(655)

(15,972)

¥ 10,036

$ 171,927 78,359 16,355 55,307

(42,408)

279,541

(153,049)

(11,574)(7,050)

(171,674)

$ 107,867

Projected benefit obligationPension assetsUnrecognized actuarial

differencesUnrecognized prior

service cost

Net amount recognized in theconsolidated balance sheets

Prepaid pension costs

Provision for retirement benefits

Thousands ofU.S. Dollars

¥ 47,497 (26,100)

(8,238)

1,207

14,365 ―

¥ 14,365

$ 510,504 (280,527)

(88,548)

12,973

154,401 ―

$ 154,401

2009 2010 2010

Millions of Yen

¥ 47,453 (24,384)

(12,073)

1,663

12,658 (340)

¥ 12,999

14. Long-lived AssetsThe Group recognized impairment losses for the years ended March 31, 2010 as follows:

The Bank policies for asset grouping are as follows. In principle, grouping is implemented at the smallest managerial accounting division level, individual branch offices. Grouping is also carried out at the asset level for assets scheduled for disposal and for inactive assets. The headquarters, operation centers, and welfare centers which are assets related to the entire Daishi Bank are treated as common assets.

The Bank also carries out grouping for consolidated subsid-iaries with impairment losses included using similar methods.

The recoverable value is calculated based on the higher amounts of the net selling price and the value in use. The net selling price is calculated, mainly, based on the real estate appraisal value. The value in use is calculated with 3.96% discounted from the future cash flow, with separate calculation methods for the above.

15. Accumulated depreciationAccumulated depreciation of Property, plant and equipment was ¥79,656 million as of March 31, 2009 and ¥79,131 million($850,515 thousand) as of March 31, 2010.

Niigata Pref.

Niigata Pref.

Saitama Pref.

Fukushima Pref.

Total

Thousands ofMillionsof Yen U.S. DollarsArea

Branch offices and other

Idle assets and other

Branch offices and other

Idle assets and other

Principal purpose

of use

Land and buildings

Land and buildings

Land and buildings

Land and buildings

Classification

$ 3,337

$ 2,783

$ 938

$ 29

$ 7,088

¥ 310

¥ 259

¥ 87

¥ 2

¥ 659

2524 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

¥ 78,078591

78,66969,176

¥ 9,493¥ 4,469,551

2,759659

4,614

2010Millions of Yen

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

2009Millions of Yen

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

$ 27,99926,79254,79238,992

$ 15,800$ 164,516

47----52

$ 24,74320

24,76323,437

$ 1,326$ 127,387

34138

479

$ 1,073,86939,529

1,113,399985,088

$ 128,310$ 48,794,957

34,6807,123

58,418

$ ---- (39,529)(39,529)(40,089)

$ 559 $ (418,072)

3,341 (35)

3,301

$ 1,073,869 ----

1,073,869944,999

$ 128,870$ 48,376,884

38,0217,088

61,719

$ 181,9386,359

188,298179,146

$ 9,151$ 464,019

4,632----

8,284

$ 839,1886,356

845,545743,512

$ 102,032$ 48,039,033

29,6587,084

49,601

2010Thousands of U.S. Dollars

Segment information for the years ended March 31, 2009 and 2010 is shown in the tables below:

16. Segment information

(a) Business segment information

¥ 2,6052,4925,0973,627

¥ 1,470¥ 15,306

4----4

¥ 2,7582,9315,6894,830

¥ 858¥ 15,267

1--------

¥ 2,3021

2,3042,180

¥ 123¥ 11,852

313

44

¥ 2,138 1

2,140 2,195

¥ (55)¥ 12,086

29 8

17

¥ 99,9123,677

103,59091,652

¥ 11,938¥ 4,539,882

3,226662

5,435

¥ 110,3454,382

114,727104,242

¥ 10,484¥ 4,391,495

2,85532

3,844

¥ ---- (3,677)(3,677)(3,729)

¥ 52 ¥ (38,897)

310 (3)

307

¥ ---- (4,382)(4,382)(4,824)

¥ 442 ¥ (41,703)

455 (3)----

¥ 99,912 ----

99,91287,922

¥ 11,990¥ 4,500,985

3,537659

5,742

¥ 110,345----

110,34599,418

¥ 10,927¥ 4,349,791

3,31129

3,844

¥ 16,927591

17,51916,667

¥ 851¥ 43,172

431----

770

¥ 17,193698

17,89117,136

¥ 755¥ 45,339

435----

889

¥ 88,255750

89,00580,080

¥ 8,925¥ 4,318,800

2,38924

2,937

Notes;1. Yen amounts are rounded down to the nearest million yen.2. The business segmentation is determined based on the Bank’s internal administrative purposes.3. Segmentation is based on each consolidated company’s line of business. “Others” represents non-banking business, credit card business, and so forth.4. As noted in “Important item changes for standards for consolidated financial statements”, “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10

2008.3.10) and “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No.19 2008.3.10) take effect beginning with the current consolidated fiscal year.Through this, in comparison with the previous methods operating profit for our banking business decreased by ¥142 million.

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Written-off of loansLosses on sales of fixed assetsLosses on devaluation of stocks　and other securitiesImpairment lossesOther

Total

Reversal of allowance for loan losses

Gain on sales of stocksand other securities

Recoveries of written-off claimsOther

Total

$ 45,3391,995

7,5247,088

199,574$ 253,998

Thousands ofU.S. Dollars

¥ 4,218185

700659

18,568¥ 23,631

2009 2010 2010

Millions of Yen

$ 8,946

10,05820,898

195,338$ 235,242

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

(b) Segment information by location

(c) International operating income

Since the operating income and assets is only the “Japan” segment, segment information by location for the years ended March 31, 2009 and 2010 is not disclosed.

Since the international operating income is less than 10% of the total operating income for the years ended March 31, 2009 and 2010, such information is not disclosed.

¥ ----

2,1711,226

20,096¥ 23,494

¥ 4,473674

83529

18,733¥ 24,746

¥ 832

9351,944

18,174¥ 21,886

17. Other incomeOther income for the years ended March 31, 2009 and 2010 consisted of the following:

18. Other expensesOther expenses for the years ended March 31, 2009 and 2010 consisted of the following:

19. Subsequent eventsAt the general meeting held on June 24, 2010, the stockholders approved a cash dividend totaling ¥1,292 million ($ 13,890 thousand) or ¥3.50 per share.

2524 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

¥ 78,078591

78,66969,176

¥ 9,493¥ 4,469,551

2,759659

4,614

2010Millions of Yen

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

2009Millions of Yen

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Operating income:External customersIntersegment

TotalOperating expenses

Operating profit

AssetsDepreciation and amortizationLoss on impairment of fixed assetsCapital expenditures

$ 27,99926,79254,79238,992

$ 15,800$ 164,516

47----52

$ 24,74320

24,76323,437

$ 1,326$ 127,387

34138

479

$ 1,073,86939,529

1,113,399985,088

$ 128,310$ 48,794,957

34,6807,123

58,418

$ ---- (39,529)(39,529)(40,089)

$ 559 $ (418,072)

3,341 (35)

3,301

$ 1,073,869 ----

1,073,869944,999

$ 128,870$ 48,376,884

38,0217,088

61,719

$ 181,9386,359

188,298179,146

$ 9,151$ 464,019

4,632----

8,284

$ 839,1886,356

845,545743,512

$ 102,032$ 48,039,033

29,6587,084

49,601

2010Thousands of U.S. Dollars

Segment information for the years ended March 31, 2009 and 2010 is shown in the tables below:

16. Segment information

(a) Business segment information

¥ 2,6052,4925,0973,627

¥ 1,470¥ 15,306

4----4

¥ 2,7582,9315,6894,830

¥ 858¥ 15,267

1--------

¥ 2,3021

2,3042,180

¥ 123¥ 11,852

313

44

¥ 2,138 1

2,140 2,195

¥ (55)¥ 12,086

29 8

17

¥ 99,9123,677

103,59091,652

¥ 11,938¥ 4,539,882

3,226662

5,435

¥ 110,3454,382

114,727104,242

¥ 10,484¥ 4,391,495

2,85532

3,844

¥ ---- (3,677)(3,677)(3,729)

¥ 52 ¥ (38,897)

310 (3)

307

¥ ---- (4,382)(4,382)(4,824)

¥ 442 ¥ (41,703)

455 (3)----

¥ 99,912 ----

99,91287,922

¥ 11,990¥ 4,500,985

3,537659

5,742

¥ 110,345----

110,34599,418

¥ 10,927¥ 4,349,791

3,31129

3,844

¥ 16,927591

17,51916,667

¥ 851¥ 43,172

431----

770

¥ 17,193698

17,89117,136

¥ 755¥ 45,339

435----

889

¥ 88,255750

89,00580,080

¥ 8,925¥ 4,318,800

2,38924

2,937

Notes;1. Yen amounts are rounded down to the nearest million yen.2. The business segmentation is determined based on the Bank’s internal administrative purposes.3. Segmentation is based on each consolidated company’s line of business. “Others” represents non-banking business, credit card business, and so forth.4. As noted in “Important item changes for standards for consolidated financial statements”, “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10

2008.3.10) and “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No.19 2008.3.10) take effect beginning with the current consolidated fiscal year.Through this, in comparison with the previous methods operating profit for our banking business decreased by ¥142 million.

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Banking Leasing Securities Other Total Elimination orcorporate Consolidated

Written-off of loansLosses on sales of fixed assetsLosses on devaluation of stocks　and other securitiesImpairment lossesOther

Total

Reversal of allowance for loan losses

Gain on sales of stocksand other securities

Recoveries of written-off claimsOther

Total

$ 45,3391,995

7,5247,088

199,574$ 253,998

Thousands ofU.S. Dollars

¥ 4,218185

700659

18,568¥ 23,631

2009 2010 2010

Millions of Yen

$ 8,946

10,05820,898

195,338$ 235,242

Thousands ofU.S. Dollars

2009 2010 2010

Millions of Yen

(b) Segment information by location

(c) International operating income

Since the operating income and assets is only the “Japan” segment, segment information by location for the years ended March 31, 2009 and 2010 is not disclosed.

Since the international operating income is less than 10% of the total operating income for the years ended March 31, 2009 and 2010, such information is not disclosed.

¥ ----

2,1711,226

20,096¥ 23,494

¥ 4,473674

83529

18,733¥ 24,746

¥ 832

9351,944

18,174¥ 21,886

17. Other incomeOther income for the years ended March 31, 2009 and 2010 consisted of the following:

18. Other expensesOther expenses for the years ended March 31, 2009 and 2010 consisted of the following:

19. Subsequent eventsAt the general meeting held on June 24, 2010, the stockholders approved a cash dividend totaling ¥1,292 million ($ 13,890 thousand) or ¥3.50 per share.

2726 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Corporate Organization Directory Chart

Assets Review and Audit Office

(As of July 1, 2010)

Secretariat

Planning and Coordination Division

Public Relations Office

Compliance and Risk Supervision Office

ALM Office

Management Administration Division

Audit and Inspection Division

Credit Supervision Division

Loan Examination Division

Operation Centralization Division

Operation Support Division

Treasury and Capital Markets Division

Securities and International Division

Corporate Support Office

Systems Planning Division

Business Process Reengineering Promotion Office

Loan Administration Division

Loan Operation Center

International Business Planning Office

Securities Office

New Business Planning Office

Customer Relations Office

Credit Card Office

Loan Centers

Business Promotion Division

Consumer Business Support Division

Corporate Business Support Division

Public Institutions Office

Personnel Division

Human Resources Development Office

Operation Administration Division

General Affairs Division

Tokyo Representative Office

Offices

Board of Corporate Auditors

Accounting Auditors

Board of Directors

Executive Committee

General Meeting of Stockholders

Sourcing Administration Office

Offices

Consulting Plaza

Area Headquarters

OperationHeadquarters

Number of Offices by Area

Niigata 113

Tokyo 2

Others 7

Total 122

(As of July 1, 2010)

(As of July 1, 2010)

(As of March 31, 2010)

Head Office1071-1, Higashiborimae-dori7-bancho chuo-ku, Niigata 950-8746Telephone: (025)222-4111URL: http://www.daishi-bank.co. jp/

Securities and International Division(International Division)HeadquartersAddress: same as above.Telephone: (025)222-4111Facsimile: (025)225-2331SWIFT: DAIS JPJT

Board of Directors andCorporate Auditors

Service Network

Major stockholders (10 largest)Number of Share

(Thousand)

The Daishi Staff Service Co., Ltd.224-1, Honcho-dori 5-bancho chuo-ku, Niigata 951-8067

The Daishi Lease Co., Ltd.2-10, Akashi 2-chome chuo-ku, Niigata 950-0084

The Daishi Computer Service Co., Ltd.1-17, Abumi 1-chome chuo-ku, Niigata 950-0913

The Daishi Guaranty Co., Ltd.224-1, Honcho-dori 5-bancho chuo-ku, Niigata 951-8067

The Daishi JCB Card Co., Ltd.1245, Kamiokawamae-dori 8-bancho chuo-ku, Niigata 950-8068

The Daishi Management Consulting Co., Ltd.1-18, Higashi-odori 2-chome chuo-ku, Niigata 950-0087

The Daishi DC Card Co., Ltd.1245, Kamiokawamae-dori 8-bancho chuo-ku, Niigata 950-8068

latipaCnoitaroprocnIssenisub rojaMynapmoC

Ratio of shareholder voting rights held bythe Daishi Bank

Supply of temporary staff

General leasing business

Computer-related services

Credit guarantee business

Credit card andcredit guaranty businesses

Consulting business andventure capital

Credit card business

Niigata Securities Co., Ltd.8-26, Jonaicho 3-chome, Nagaoka 940-0061

The securities industry

Corporate Data

Subsidiaries

ChairmanKunito Kojima PresidentMasayuki Obara Senior Managing DirectorKenichi Yazawa

Managing DirectorsYoshihito SaitoKiyofumi TamakiSumio TanedaFujio NamikiKousuke Sasaki

DirectorsSatoshi Hasegawa

Standing Corporate AuditorsFumitoshi TashiroYasunori Kokuryou Corporate AuditorsGen HoshinoTadashi MaruyamaToshio Suzuki Securities and International Division(International Division)General ManagerNobuyuki Takaki

Percent

(As of July 1, 2010)

1. Nippon Life Insurance Company 12,826 3.46

　2. Japan Trustee Service Bank,Ltd.（Trust Account） 10,960 2.96

　3. Nipponkoa Insurance Co.,Ltd. 9,464 2.55

　4. The Bank of Tokyo-Mitsubishi UFJ,Ltd. 9,356 2.52

　5. Employees' stockholdings 8,927 2.41

　6. Tokio Marine & Nichido Fire Insurance Co.,Ltd. 8,384 2.26

　7. Tohoku Electric Power Co.,Inc. 8,372 2.26

8. Meiji Yasuda Life Insurance Company 8,159 2.20

9. The Master Trust Bank of Japan,Ltd.（Trust Account） 8,126 2.19

10. Daido Life Insurance Company 7,056 1.90

Oct. 28, 1988 ¥ 20 million 100%

Nov. 11, 1974 ¥ 100 million 5%

May 10, 1976 ¥ 15 million 5%

Oct. 27, 1978 ¥ 50 million 5%

March 1,1990 ¥ 30 million 5%

Aug. 8,1952 ¥ 600 million 48%

Nov. 12, 1982 ¥ 30 million 5%

June 8, 1984 ¥ 20 million 5%

2726 THE DAISHI BANK THE DAISHI BANK 2010 ANNUAL REPORT 2010 ANNUAL REPORT

Corporate Organization Directory Chart

Assets Review and Audit Office

(As of July 1, 2010)

Secretariat

Planning and Coordination Division

Public Relations Office

Compliance and Risk Supervision Office

ALM Office

Management Administration Division

Audit and Inspection Division

Credit Supervision Division

Loan Examination Division

Operation Centralization Division

Operation Support Division

Treasury and Capital Markets Division

Securities and International Division

Corporate Support Office

Systems Planning Division

Business Process Reengineering Promotion Office

Loan Administration Division

Loan Operation Center

International Business Planning Office

Securities Office

New Business Planning Office

Customer Relations Office

Credit Card Office

Loan Centers

Business Promotion Division

Consumer Business Support Division

Corporate Business Support Division

Public Institutions Office

Personnel Division

Human Resources Development Office

Operation Administration Division

General Affairs Division

Tokyo Representative Office

Offices

Board of Corporate Auditors

Accounting Auditors

Board of Directors

Executive Committee

General Meeting of Stockholders

Sourcing Administration Office

Offices

Consulting Plaza

Area Headquarters

OperationHeadquarters

Number of Offices by Area

Niigata 113

Tokyo 2

Others 7

Total 122

(As of July 1, 2010)

(As of July 1, 2010)

(As of March 31, 2010)

Head Office1071-1, Higashiborimae-dori7-bancho chuo-ku, Niigata 950-8746Telephone: (025)222-4111URL: http://www.daishi-bank.co. jp/

Securities and International Division(International Division)HeadquartersAddress: same as above.Telephone: (025)222-4111Facsimile: (025)225-2331SWIFT: DAIS JPJT

Board of Directors andCorporate Auditors

Service Network

Major stockholders (10 largest)Number of Share

(Thousand)

The Daishi Staff Service Co., Ltd.224-1, Honcho-dori 5-bancho chuo-ku, Niigata 951-8067

The Daishi Lease Co., Ltd.2-10, Akashi 2-chome chuo-ku, Niigata 950-0084

The Daishi Computer Service Co., Ltd.1-17, Abumi 1-chome chuo-ku, Niigata 950-0913

The Daishi Guaranty Co., Ltd.224-1, Honcho-dori 5-bancho chuo-ku, Niigata 951-8067

The Daishi JCB Card Co., Ltd.1245, Kamiokawamae-dori 8-bancho chuo-ku, Niigata 950-8068

The Daishi Management Consulting Co., Ltd.1-18, Higashi-odori 2-chome chuo-ku, Niigata 950-0087

The Daishi DC Card Co., Ltd.1245, Kamiokawamae-dori 8-bancho chuo-ku, Niigata 950-8068

latipaCnoitaroprocnIssenisub rojaMynapmoC

Ratio of shareholder voting rights held bythe Daishi Bank

Supply of temporary staff

General leasing business

Computer-related services

Credit guarantee business

Credit card andcredit guaranty businesses

Consulting business andventure capital

Credit card business

Niigata Securities Co., Ltd.8-26, Jonaicho 3-chome, Nagaoka 940-0061

The securities industry

Corporate Data

Subsidiaries

ChairmanKunito Kojima PresidentMasayuki Obara Senior Managing DirectorKenichi Yazawa

Managing DirectorsYoshihito SaitoKiyofumi TamakiSumio TanedaFujio NamikiKousuke Sasaki

DirectorsSatoshi Hasegawa

Standing Corporate AuditorsFumitoshi TashiroYasunori Kokuryou Corporate AuditorsGen HoshinoTadashi MaruyamaToshio Suzuki Securities and International Division(International Division)General ManagerNobuyuki Takaki

Percent

(As of July 1, 2010)

1. Nippon Life Insurance Company 12,826 3.46

　2. Japan Trustee Service Bank,Ltd.（Trust Account） 10,960 2.96

　3. Nipponkoa Insurance Co.,Ltd. 9,464 2.55

　4. The Bank of Tokyo-Mitsubishi UFJ,Ltd. 9,356 2.52

　5. Employees' stockholdings 8,927 2.41

　6. Tokio Marine & Nichido Fire Insurance Co.,Ltd. 8,384 2.26

　7. Tohoku Electric Power Co.,Inc. 8,372 2.26

8. Meiji Yasuda Life Insurance Company 8,159 2.20

9. The Master Trust Bank of Japan,Ltd.（Trust Account） 8,126 2.19

10. Daido Life Insurance Company 7,056 1.90

Oct. 28, 1988 ¥ 20 million 100%

Nov. 11, 1974 ¥ 100 million 5%

May 10, 1976 ¥ 15 million 5%

Oct. 27, 1978 ¥ 50 million 5%

March 1,1990 ¥ 30 million 5%

Aug. 8,1952 ¥ 600 million 48%

Nov. 12, 1982 ¥ 30 million 5%

June 8, 1984 ¥ 20 million 5%

Year ended March 31, 20102010