(1) General Account

Balance Sheet

(Unit: million yen)
Assets Liabilities and Net Assets
Item March 31, 2011 Item March 31, 2011
(Current Assets) 6,149 (Current Liabilities) 93,238
Cash and Deposits
794
Short-term Borrowings
92,300
Short-Term Loans
5,064
Accounts Payable
906
Money Deposited
219
Accrued Expenses Payable
9
Securities
-
Money on Deposit
22
Suspense Payments
-
Suspense Receipts
0
Prepaid Expenses
1    
Accrued Income
176 (Fixed Liabilities) 137,565
Accounts Receivable
0 Liability Reserves 137,348
Loan Loss Reserves
(105) Reserves for Retirement Allowance 216
       
(Fixed Assets) 225,109    
Financial Assistance Related Assets 23,289 (Liabilities Total) 230,804
Purchased Assets
30,445    
Loan Loss Reserves
(7,155) (Capital) 455
Deposits and Other Assets Related to Asset
Purchase Operations
 
Government Capital
150
Deposits and Other Claims Purchased
2,421
Bank of Japan Capital
150
Assets Related to Contracted Bridge Bank  
Private Capital
155
Subsidiary Stock
4,170    
Assets Related to Contracted Bank 107,600 (Deficit) -
Contracted Bank Shares
12,000
Deficit Brought Forward
(273,260)
Loans for Contracted Bank
95,600
Current Profit
273,260
Assets of Financial Institutions Under      
Management 87,175    
Loans of Financial Institutions Under Management
348,700    
Loan Loss Reserves
(261,525)    
Tangible Fixed Assets 187 (Net Assets Total) 455
Buildings
160    
Tools/Equipment/Fixtures
26    
Intangible Fixed Assets 2    
Investment and Other Assets      
Guarantee Money and Other Security Deposit
263    
       
Total 231,259 Total 231,259

Note: Figures are rounded down.

 

Profit and Loss Statement

(Unit: million yen)
Expenses Revenue
Item FY2010 Item FY2010
(Current Expenses) 448,894 (Current Revenue) 722,155
Financial Assistance Expenses
524
Insurance Premium Revenues
 
Monetary Grants
18
Deposit Insurance Premiums
679,397
Loss on sales of Purchased Assets
485
Income from Financial Assistance-related Business
0
Administrative Expenses for Purchased Assets
5
Income from Purchased Assets
0
Cost of Commissioning Management and Collection Recovery Business
15
Profit on Sales of Purchased Assets
0
Expenses for Operations to Purchase Deposits and Other Claims 18
Interrest on Loans of Financial Institutions Under Management
140
Refunds of Insurance Premiums for Prior Periods 50
Income from Contracted Bank Business
33,281
Payments to Government 33,941
Interest on Loans to Contracted Bank
151
General Administrative Expenses 7,891
Transfer Payments by Contracted Bank
33,129
Transfer to Liability Reserves 137,348 Income from Contribution by Contracted Bridge Banks 38
Transfer to Loan Loss Reserves 268,786 Refunded Monetary Grants 1,556
Non-Operating Expenses 332 Reversal from Loan Loss Reserves 7,694
Interest on Borrowing
330 Non-operating Income 44
Administrative Expenses for Borrowings
1    
Interest on DICJ Bonds
-    
Administrative Expenses for DICJ Bonds
-    
       
       
(Extraordinary Expenses)      
Loss from Retirement of Fixed Assets 0    
       
(Current Profit) 273,260    
       
Total 722,155 Total 722,155

The notes below refer to the items mentioned for the FY2010 settlement of accounts.

Notes: 1. Current profit of ¥273,260 million for this fiscal year is used to decrease loss brought forward from the previous fiscal year, pursuant to the provision of Article 15,paragraph 1 of the Ordinance of Enforcement of the Deposit Insurance Act.
2. Figures are rounded down.
Important Accounting Principles and Other Relevant Matters
1.  Evaluation Method for Securities

Cost method based on the periodic average method.

2.  Depreciation Method for Fixed Assets
Fixed installment method using the criteria under the Corporation Tax Act. The aggregate depreciation amount is as follows
Financial Assistance Operating Assets¥23 million
Tangible Fixed Assets: ¥336 million
3.  Appropriation Criteria for Reserves

(1)  Loan Loss Reserves

For claims related to debtors for whom statutory facts of business failure (e.g. bankruptcy or composition) have occurred, or debtors in an equivalent position, the estimated disposable collateral and estimated recoverable amount through guarantees are subtracted from the amount of the claim, and the remainder is aggregated. For debtors who face, or are highly likely to face, serious problems in the repayment of debts, although not yet in a state of business failure, the estimated amount recovered through collateral etc., and the estimated amount in light of the debtors' financial status and business performance, are reduced from the amount of the claim, and the remainder being aggregated as loan loss reserves. Claims other than the above are aggregated on the basis of a bad debt ratio deemed reasonable.
Given that it has been decided to conduct the purchase of deposits and other claims (the estimated proceeds payment) prescribed by Article 70 of the Deposit Insurance Act at the estimated proceeds payment rate of 25%, provisions for loan loss reserves for the principal of loans outstanding to the Incubator Bank and interest on those loans have been set aside using the rate obtained (75%) by subtracting, the said estimated proceeds payment rate (25%) as the loan loss reserve rate in view of the facts that assets and liabilities of the borrower concerned have been evaluated at the time of calculating the estimated proceeds payment rate and that no new development (approval of a reorganization plan) has occurred as of the end of FY2010.
The loan loss reserves for the principal of the loans have been accounted for as business assets of financial institutions under management among fixed assets, while the loan loss reserves on interest on the loans have been accounted for as current assets. No loan loss reserves have been set aside for short-term loans accounted for as current assets pursuant to the provisions of Article 17 of the Ordinance for Enforcement on the Deposit Insurance Act, as such short-term loans are the lending of call money against the collateral of government bonds.

(2)  Reserves for Retirement Allowance

The required remuneration at the end of fiscal year is used as the criteria for appropriating reserves in preparation for payment of retirement allowances for employees.
4.  Provisions for liability reserves
At the end of each business year, the DICJ must calculate a liability reserve for the General Account, to be set aside in accordance with ordinances of the Cabinet Office and the Ministry of Finance. Article 15 of the Ordinance for Enforcement on the Deposit Insurance Act stipulates that an amount of liability reserves that must be set aside cumulatively in each business year shall be an amount equivalent to an amount obtained by subtracting the combined amount of expenses (excluding the transfer to liability reserves) and loss carried forward from an amount of revenue in the business year concerned.
5.  Other Important Matters relating to Preparation of Financial Statements

(1)  Accounting method for consumption tax: tax inclusive method

(2)  Accounting criteria for revenue and expenses: accrual method

(3)  Other

ⅰ)  Regarding income from contracted banks under the provision of Article 7 of the Supplementary Provisions of Deposit Insurance Act, the DICJ received the payments statement prepared under the account settlement for FY2010 from the RCC (Contracted Bank) on May 31, 2011. In the RCC, the payments are accounted for in FY2010, but in the DICJ, they are accounted for as revenue in the following fiscal year in accordance with the provision of Article 4, paragraph 2 of the Accounting Regulations.
The amount of profit or loss arising from such accounting is estimated at¥26,826 million in transfer payments by the contracted bank (of which the estimated amount of payments to the government¥25,023 million) in the following fiscal year.

ⅱ)  Following the application for financial assistance as well as financial assistance for equal treatment filed in the joint names of the Incubator Bank, the failed financial institution, and the 2nd BBJ, the assuming financial institution, the Policy Board of the DICJ, at the 217th meeting held on April 15, 2011, decided to provide the following financial assistance on the day when the transfer of business is to be implemented (April 25, 2011):

a.  Monetary grants to the 2nd BBJ
The amount of monetary grants ¥104,050 million
However, the amount of monetary grants may increase or decrease after the determination of actual figures as of the date of the transfer of business.

b.  Monetary grants to the Incubator Bank
The amount of monetary grants¥65,597 million
However, the amount of monetary grants may increase or decrease after the determination of actual figures as of the date of the transfer of business.

c.   Purchase of assets from the Incubator Bank
The amount of assets to be purchased¥52,929 million

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