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Policy for Disposal of Nonperforming Loans and Balance of Nonperforming Loans as of March 31, 2006
Hyakugo Bank makes appropriate write-offs and provisions to reserves according to the possibility of recovery or the risk of impairment of loan assets, as determined by the Bank’s self-assessment of credits. In addition, the Bank aggressively works to recover nonperforming loans, and is carrying out the final disposal of nonperforming loans through sales and other means. As a result, the amount of disposal of nonperforming loans on a consolidated basis in the year ended March 31, 2006 totaled ¥3,631 million.
Risk-Monitored Loans and Balance, Prior-Year Comparison and Loans Disclosed under the Financial Reconstruction Law
Risk-monitored loans on a consolidated basis totaled ¥83,589 million as of March 31, 2006, a decrease of ¥904 million from a year earlier, and represented 4.04 percent of total loans outstanding, a decrease of 18 basis points from a year earlier.
Loans disclosed under the Financial Reconstruction Law on a consolidated basis totaled ¥84,427 million as of March 31, 2006, a decrease of ¥761 million compared to a year earlier. Nonperforming loans as a percentage of total credit outstanding remained at a low level, decreasing 16 basis points from a year earlier to 3.99 percent. The coverage for nonperforming loans was 80.39 percent, and the Bank maintains appropriate reserves to cover future risks and improve asset quality.
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| Coverage for Credit Exposure under Financial Reconstruction Law Disclosure Standards (Consolidated) |
| |
Millions of yen |
| |
2006 |
2005 |
2004 |
2003 |
2002 |
2006/2005
Increase
(decrease) |
|
Loans disclosed according to the
Financial Reconstruction Law
(normal loans excluded) |
¥84,427 |
|
¥85,188 |
|
¥98,646 |
|
¥102,265 |
|
¥98,190 |
|
¥ (761 |
) |
|
| Reserve for possible loan losses |
26,367 |
|
28,663 |
|
30,803 |
|
38,052 |
|
35,052 |
|
(2,295 |
) |
|
| Collateral,etc. |
41,509 |
|
42,625 |
|
48,291 |
|
50,253 |
|
50,015 |
|
(1,116 |
) |
|
| Coverage amount |
¥67,877 |
|
¥71,289 |
|
¥79,094 |
|
¥ 88,305 |
|
¥85,068 |
|
¥(3,411 |
) |
|
| Coverage ratio |
80.39 |
% |
83.68 |
% |
80.17 |
% |
86.35 |
% |
86.63 |
% |
(3.29 |
) |
points |
|
|
|
|
|
 |
| Loans under the Financial Reconstruction Law (Consolidated) |
| |
Millions of yen |
| |
2006 |
2005 |
2004 |
2003 |
2002 |
2006/2005
Increase
(decrease) |
|
| Bankrupt and quasi-bankrupt assets |
¥15,360 |
|
¥13,584 |
|
¥17,491 |
|
¥ 32,785 |
|
¥29,082 |
|
¥ 1,776 |
|
|
| Doubtful assets |
40,574 |
|
40,115 |
|
44,478 |
|
40,520 |
|
40,313 |
|
458 |
|
|
| Substandard loans |
28,492 |
|
31,489 |
|
36,676 |
|
28,958 |
|
28,795 |
|
(2,996 |
) |
|
| Total of problem assets |
¥84,427 |
|
¥85,188 |
|
¥98,646 |
|
¥102,265 |
|
¥98,190 |
|
¥ (761 |
) |
|
| Normal assets |
¥2,028,063 |
|
¥1,967,373 |
|
¥1,952,196 |
|
¥1,993,974 |
|
¥1,984,921 |
|
¥60,689 |
|
|
| Ratio of the problem assets to loans |
3.99 |
% |
4.15 |
% |
4.81 |
% |
4.87 |
% |
4.71 |
% |
(0.16 |
) |
points |
|
|
|
|
|
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| Risk-Monitored Loans (Consolidated) |
| |
Millions of yen |
| |
2006 |
2005 |
2004 |
2003 |
2002 |
2006/2005
Increase
(decrease) |
|
| Loans to borrowers in legal bankruptcy |
¥ 3,736 |
|
¥ 3,864 |
|
¥ 5,725 |
|
¥13,799 |
|
¥12,697 |
|
¥ (128 |
) |
|
| Past due loans |
51,361 |
|
49,140 |
|
55,469 |
|
57,972 |
|
55,131 |
|
2,220 |
|
|
| Past due three months or more |
233 |
|
402 |
|
559 |
|
620 |
|
465 |
|
(169 |
) |
|
| Restructured loans |
28,259 |
|
31,086 |
|
36,116 |
|
28,330 |
|
28,315 |
|
(2,827 |
) |
|
| Total |
¥83,589 |
|
¥84,494 |
|
¥97,871 |
|
¥100,723 |
|
¥96,610 |
|
¥ (904 |
) |
|
|
| Nonperforming Loans under Internal-Assessment Standard (Non-Consolidated) |
| March 31, 2006 |
(Billions of yen) |
| Failure
|
Substantial failure possible |
Possible failure |
Loans under close observation |
Pass |
Total |
| Substandard |
Others |
| 3.7 |
11.2 |
40.0 |
45.3 |
107.6 |
1,900.6 |
2,108.5 |
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