consolidated financial results of toyo trust & banking · consolidated financial results of...

The Toyo Trust and Banking Company, Limited

November 22, 2001

Consolidated Financial Results of Toyo Trust & BankingFor the Six Months Ended September 30, 2001

The Toyo Trust and Banking Company, Limited, a subsidiary of UFJ Holdings, Inc., today reported the Bank's consolidated financial results for the six months ended September 30, 2001.

Total Income for the fiscal year was 171 billion yen, compared with 196 billion yen for theprevious fiscal year. Net Income for the fiscal year was (33) billion yen, compared with 19 billionfor the previous fiscal year.

FINANCIAL HIGHLIGHTSSix months ended September 30,

2001 2000Millions of yen (Unaudited) (Unaudited)

RESULTS

Total Income 171,882 196,158

Income before Income Taxes, & Minority Interests (56,055) 35,665

Net Income (33,667) 19,510

BALANCE SHEET

Total Assets 8,228,946 7,791,227

Stockholders' Equity 426,195 591,927

PER SHARE

Net Income (36.35) 19.60

Stockholders' Equity 157.88 336.86

Notes:

(1)

(2)

*Excluding treasury stocks and stocks held by subsidiaries

(3) Equity in earnings of affiliates as of September 30, 2001 is 1,307 million yen.

(4) For Net Income per Share and Stockholders' Equity per Share, the third decimal is omitted.

(5) Amounts less than one million yen are omitted.

Net Income － Dividends for Preferred Stock

Weighted Average Number of Shares of Common Stock *Net Income per Share =

Stockholders' Equity Stockholders' Equity － Number of Shares of Preferred Stock × Issue Priceper Share Number of Shares of Common Stock *

=

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(NOTES)Scope of Consolidation and Application of the Equity Method(1) Consolidated Companies

(Consolidated Subsidiaries) 12 CompaniesToyo Trust Capital Co., Ltd.Toyo Trust Total Finance Co., Ltd.Toyo Realty Co., Ltd.Toyo Trust Company of New York, and others

(Companies excluded) 2 CompaniesToyo Trust Asset Management Co., Ltd.

Toyo Trust Operation Services Co., Ltd.

(2) Companies accounted for under the Equity Method(Companies accounted for under the equity method) 7 Companies

United Leasing Company LimitedJapan Pension Planning Co., Ltd.

(Companies newly accounted for under equity method) 2 CompaniesUFJ Asset Management Co., Ltd.M&T Information Technology Co.,Ltd.

(3) Assets, income and net income of non-consolidated subsidiaries and affiliates which arenot accounted for under equity method have no significant impact on the consolidatedfinancials.

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The Toyo Trust and Banking Company, LimitedCONSOLIDATED BALANCE SHEETS

As of September 30, As of March 31,Millions of yen 2001 2000 2001

(Unaudited) (Unaudited)

Assets: Cash and Due from Banks 417,986 648,796 523,530 Call Loans 56,990 35,675 26,599 Monetary Receivables Bought 66,572 18,228 33,730 Trading Assets 100,982 83,551 110,604 Securities 2,780,808 2,320,555 2,757,988 Loans and Bills Discounted 3,927,788 3,974,986 3,748,440 Foreign Exchanges 3,696 5,956 3,544 Other Assets 272,457 219,764 309,228 Premises and Equipment 119,615 179,994 178,840 Deferred Tax Assets 249,746 145,663 159,976 Goodwill - 437 -Customers' Liabilities for Acceptances and Guarantees 330,827 263,231 342,717 Reserve for Possible Loan Losses (98,525) (105,533) (91,154)Reserve for Possible Losses on Securities - (81) (183)

Total Assets 8,228,946 7,791,227 8,103,865

Liabilities, Minority Interests and Stockholders' Equity

Liabilities:Deposits 2,967,718 3,533,564 2,934,566 Negotiable Certificates of Deposit 1,128,970 246,930 739,610 Call Money 407,765 120,486 218,458 Payables under Repurchase Agreements 4,249 - -Trading Liabilities 18,861 6,513 17,752 Borrowed Money 200,417 194,586 188,722 Foreign Exchanges 54 17 0 Bonds and Notes 158,224 188,174 162,588 Convertible Bonds - 24,196 19,140 Borrowed Money from Trust Account 2,474,250 2,186,388 2,736,497 Other Liabilities 98,102 405,215 162,680 Reserve for Bonus 1,842 - -Reserve for Retirement Benefits 632 3,358 923 Reserve for Contingent Liabilities Related to Loans Sold 2,039 3,868 3,944 Reserve for Supporting Specific Borrowers - 14,920 -Deferred Tax Liabilities Related to Revaluation Reserve for Land 7,265 6,950 7,265 Acceptances and Guarantees 330,827 263,231 342,717

Total Liabilities 7,801,223 7,198,401 7,534,866

Minority Interests 1,527 898 990

Stockholders' Equity:

First Class, First Series Preferred Stock 40,000 40,000 40,000First Class, Second Series Preferred Stock 100,000 100,000 100,000Common Stock 140,536 140,536 140,536Capital Surplus 252,676 252,676 252,676Revaluation Reserve for Land, Net of Taxes 11,364 10,870 11,364Retained Earnings (11,017) 49,735 24,011Net Unrealized Losses on Securities, Net of Taxes (107,304) - -Foreign Currency Translation Adjustments (58) (1,889) (575)Treasury Stock - (1) (5)

Total Stockholders' Equity 426,195 591,927 568,008Total Liabilities, Minority Interests and Stockholders' Equity 8,228,946 7,791,227 8,103,865

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Notes:(1) The Bank applies the following standard to assess the Trading Assets and the Trading

Liabilities.Transactions for "trading purposes" are those seeking to capture gains arising from short-termmarket changes or from differences between markets for interest rates, currency exchange ratesor securities. Such transactions are reported as Trading Assets and Trading Liabilities in the consolidated balance sheets for the six months ended September 30, 2001, on a trade date basis.Trading account securities and monetary receivables, etc. held for trading purposes are statedat market value at the end of the six months. Trading-related financial derivatives such as swaps,futures and options, etc. are valued on the assumption that they were settled at the end of the sixmonths.

(2) Available-for-sale securities with market value are carried at market value (cost of securities sold is determined by the moving average method), and available-for-sale securities with no market value are carried at cost or amortized cost, as determined by the moving average method. Net unrealized profits or losses on available-for-sale securities are directly reflected in the stockholders' equity.

(3) Derivatives transactions, excluding those for trading purposes, are valued at fair value method.(4) As regards the depreciation of premises and equipment, buildings are depreciated using the

straight line method and equipments are depreciated using the declining-balance method. The depreciation method hitherto for buildings has been changed from the declining-balance method to the straight line method as from the six months ended September 30, 2001. As a result of this change, the interim loss before income taxes decreased by 300 million yen,when compared with the method used hitherto.

(5) Reserve for Possible Loan Losses is provided as follows in accordance withinternal criteria regarding write-offs and reserves :(a) The reserve for claims on debtors who are legally or substantially bankrupt (Non-performing

or Quasi Non-performing) is provided based on the remaining amount of the claims after thecharge-off described below and the deductions of the amount expected to be collected through the disposal of collateral or the execution of guarantees.

(b) The reserve for claims on debtors who are not currently legally bankrupt but are likely tobecome bankrupt is provided based on the amount necessary, given the overall solvencyassessment of the debtors after deducting the amount expected to be collected through thethe disposal of collateral or the execution of guarantees.

(c) The reserve for claims on debtors other than the above is provided primarily based on thedefault rate, calculated by the actual defaults during a certain period in the past.

(d) The Specific reserve for loans to certain refinancing countries is provided based on the expected loss amount considering the political and economic situations of such countries.

With respect to the claims with collateral or guarantees on debtors who are legally or substantiallybankrupt (Non-performing or Quasi Non-performing), the remaining amount of the claims afterdeduction of the amount which is deemed collectible through the disposal of collateral or theexecution of guarantees was charged-off against the respective claims for the six months ended September 30, 2001. The amount of the charge-off was 146,912 million yen for the six months.The consolidated subsidiaries provide the Reserve for Possible Loan Losses as the amountdeemed necessary to cover such losses, principally based on past experience andmanagement's assessment of the loan portfolio.

(6) Reserve for Possible Losses on Securities is provided for possible losses on securitiesand other investments based on the amount necessary, considering the financial condition ofthe issuing companies.

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(7) Reserve for Bonuses is provided for payment of bonuses to employees. Within the estimated amount payable to employees, the amount corresponding to the six months ended September 30, 2001, is recorded. This had hitherto been recorded under Other Liabilities.

(8) Reserve for Retirement Benefit is provided for future pension payments to employees.The reserve is recorded based on the projected benefit obligation and pension plan assetamount at the end of the six months ended September 30, 2001. The unrecognized net obligation (13,370 million yen) is amortized pro rata over 5 years, and 6 /12 multiplied by the pro rata amount is recorded for the six months endedSeptember 30, 2001.

(9) Reserve for Contingent Liabilities Related to Loans Sold of the Bank is provided based onthe estimated liabilities of future losses for the loans sold, considering the fair value of collateral of loans sold to the Cooperative Credit Purchasing Company, Limited.

(10) The Bank adopts a macro hedging methodology using derivatives to manage the overall interest rate risk arising from various financial assets and liabilities held, such as loans and deposits.This macro hedging methodology is a risk management method stipulated as a "Risk Adjusted Approach" in "Tentative Accounting and Auditing Treatment relatingto Adoption of 'Accounting for Financial Instruments' for Banks" (Japanese Institute of Certified Public Accountants. Industry Audit Committee Report No.15). Accordingly hedging items are accounted for using the deferral method of hedge accounting. Hedge effectiveness is assessed by checking (i) whether the total risk in relation to derivatives instruments, used as hedging instruments, is within established risk limits as set out in the risk management policy and (ii) whether the interest rate risk arising on hedged items has been reduced.Hedging against risks of forex fluctuations on foreign currency securities (other than bonds) is accounted for using the fair value method of hedge accounting. The deferral method for hedge accounting is also applied to certain assets or liabilities other than the above. Other hedging of the Bank's domestic consolidated subsidiaries adopt the deferral method for hedge accounting.

(11) As at September 30, 2001 Loans to Bankrupt Companies and Other Delinquent Loans were11,228 million yen and 106,457 million yen, respectively.

(12) As at September 30, 2001 Loans Past Due 3 Months or More, other than Loans to BankruptCompanies and Other Delinquent Loans, were 550 million yen.

(13) As at September 30, 2001 Restructured Loans were 236,893 million yen.(14) The net realized and unrealized profits and losses arising on hedging instruments are included in

Other Liabilities as deferred hedge profits. The gross amounts of deferred hedge profits and losses are39,452 million yen and 41,582 million yen, respectively.

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(15) Market value, net unrealized profits/ losses and other information regarding securities are as follows. In addition to "Securities", trading account securities, negotiable due from banks and commercial paper under "Trading Assets", negotiable due from banks under "Cash and Due from Banks" and commodity funds under "Monetary Receivables Bought" are included.

Trading Securities Book value as of September 30, 2001 82,138 million yen

Net profits/ losses reflected in the Statements of Income for the six months ended September 30, 2001 10 million yen

Available-for-sale securities with market value

As of September 30, 2001Profits/Losses

(Millions of Yen) Cost Book Value Net Profits LossesStocks 808,412 654,245 (154,167) 17,703 171,871Bonds 1,726,538 1,727,224 686 3,118 2,432

Japanese Government Bonds 1,600,765 1,599,225 (1,539) 775 2,314Local Government Bonds 3,250 3,494 243 248 5Corporate Bonds and

Financial Debentures 122,522 124,505 1,982 2,094 112Others 352,583 330,572 (22,011) 297 22,308Total 2,887,535 2,712,043 (175,491) 21,119 196,611

Net Unrealized Profits/ Losses on Available-for-sale Securities, Net of Taxes, as ofSeptember 30, 2001, is (107,304) million yen: net unrealized profits / losses onavailable-for-sale securities shown in the above table of (175,491) million yen, plus deferred tax assets of 68,436 million yen, less minority interests equivalent of 247 million yen, plus parent bank's interest of (2) million in net unrealized profit/ loss of available-for-sale securities held by affiliates accounted for under the equity method.

(16) The Bank sold available-for-sale securities during the six months ended September 30, 2001 as follows:Book value 1,509,161 million yenProfits on sale 49,331 million yenLosses on sale 10,252 million yen

(17) Available-for-sale securities whose market value is not readily determinableAs of September 30, 2001

(Millions of Yen) Book valueAvailable-for-sale securities

Beneficiary certificates of Loan Trusts 206,093Unlisted stocks (excluding over-the-counter stocks) 39,182Unlisted bonds 31,664

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(18) The following is the redemption schedule of available-for-sale securities with maturity.

(Millions of Yen / Year) 1 or less over 1 to 5 over 5 to 10 over 10Bonds 90,113 1,113,440 230,354 324,981

Japanese Government Bonds 42,016 1,010,510 222,298 324,400Local Government Bonds - 1,770 1,142 581Corporate Bonds and

Financial Debentures 48,097 101,159 6,913 0Others 445,515 20,370 44,805 53Total 535,628 1,133,811 275,159 325,034

(19) Pursuant to overdraft agreements and commitments to provide loans, the Bank may provide loans with customers up to certain limits. Among such limits, 921,284 millionyen remains unused of which 874,487 million yen is based on contracts to be terminated within a year or revocable for the Bank at any time without any conditions.

(20) Concurrent with the adoption of accounting standard for financial instruments, the following areadopted as from the six months ended September 30, 2001.(1) The net unrealized profits or losses from the marked-to-market valuation of available-for-sale

securities, after taking deferred tax effects into account, are recorded as Net UnrealizedProfits/ Losses on Available-for-sale Securities, Net of Taxes. As a result, 'Securities' decreased 175,491 million yen, and (107,304) million yen in 'Net Unrealized Profits/ Losses on Available-for-sale Securities, Net of Taxes' was recorded.

(2) For dividends of stocks with market prices, these had hitherto been recorded as income for the fiscal year in which there was a resolution on the dividends at the shareholders' meeting or Board of Directors' meeting of the issuing company. But as from the six months ended September 30, 2001, concurrent with the marked-to-market valuation of available-for-sale securities, the accrueddividend amount based on the forecast dividend per share announced for each stock is estimatedand recorded. Due to this change, the accrued income under 'Other Assets' increased2,630 million yen, and loss before income taxes increased 2,630 million, when compared withthe method hitherto.


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CONSOLIDATED STATEMENTS OF INCOME

Six months ended September 30, Year ended2001 2000 March 31, 2001

Millions of yen (Unaudited) (Unaudited)

Income:

Trust fees 32,146 19,213 56,111 Interest Income 49,472 61,029 103,459

Interest on Loans and Discounts 28,521 33,925 68,586Interest on and Dividends from Securities 18,325 14,642 25,043

Fees and Commissions 23,955 25,592 47,522 Trading Revenue 456 421 886 Other Operating Income 17,789 3,639 12,435 Other Income 48,062 86,261 131,217

Total Income 171,882 196,158 351,632

Expenses:

Interest Expenses 24,364 38,316 64,357Interest on Deposits 9,269 11,232 23,669

Fees and Commissions 1,395 1,920 2,954Trading Expenses - 722 474 Other Operating Expenses 12,875 1,203 1,814General and Administrative Expenses 46,121 46,997 93,473Other Expenses 143,180 71,332 187,628

Total Expenses 227,937 160,493 350,703

Income (Loss) before Income Taxes, & Minority Interests (56,055) 35,665 929Provision for Income Taxes 539 516 1,043Adjustment to Income Taxes Paid in Past Year 1,944 - -Deferred Income Taxes (21,270) 16,586 2,588Minority Interests in Net Income 288 (948) (797)

Net Income (Loss) (33,667) 19,510 (1,904)

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Notes:(1) Profits and losses on transactions for trading purposes are shown as "Trading Revenue" or

"Trading Expenses" on the Statements of Income on a trade date basis.In the case of securities and monetary receivables, etc. held for trading purposes, TradingRevenue/Expenses includes the interest received/paid during the six months ended September 30, 2001 and the increase/decrease of the valuation profits/losses at the end ofthe six months ended September 30, 2001 from those at the end of the fiscal year ended March 31, 2001. In the case of trading-related financial derivatives, Trading Revenue/Expenses includes the interest received/paid during the six months ended September 30, 2001 and the increase/ decrease of the amounts of profits/losses based on the assumption that transactions were settled at the end of the six months ended September 30, 2001 from the fiscal year ended March 31, 2001.

(2) Other Expenses for the six months ended September 30, 2001 includes transfer toReserve for Possible Loan Losses of 15,499 million yen, Write-off of Loans of 9,550 millionyen, Losses on Sales of Stocks and Other Equity Securities of 9,609 million yen, Write-down of Stocks and Other Equity Securities of 98,573 million yen and 4,016 millionyen loss for the indemnified amount for principal indemnified trust accounts. Also, expenses for amortization of unrecognized net pension obligation of 1,336 million yen, pursuant to a change in accounting policy, is included.

(3) Other Income for the six months ended September 30, 2001 includes 2,078 million yen for gains on the establishment of a retirement benefit trust.


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Notes:(1) Profits and losses on transactions for trading purposes are shown as "Trading Revenue" or

"Trading Expenses" on the Statements of Income on a trade date basis.In the case of securities and monetary receivables, etc. held for trading purposes, TradingRevenue/Expenses includes the interest received/paid during the six months and the increase/decrease between the valuation profits/losses at the end of the six months and thoseat the end of the previous six months. In the case of trading-related financial derivatives, TradingRevenue/Expenses includes the interest received/paid during the six months and the increase/decrease between the amounts of profits/losses based on the assumption that transactions were settled at the end of the six months and the previous six months.

(2) Other Expenses for the six months ended September 30, 2001 includes payment of 55,640 million yen for the losses in principal indemnified trust accounts.

(3) Other Expenses for the six months ended September 30, 2001 includes pension expenses of2,677 million yen to amortize the unrecognized net obligation, pursuant to a change inaccounting policy.

(4) From this six months ended September 30, 2001, the Bank has adopted the Accounting Standard for Retirement Benefit stipulated in "Opinion Concerning the Establishment of Accounting Standards for Retirement Benefits" (Business Accounting Deliberation Council June 16, 1998). As a result, Income before Income Tax has decreased by 4,184 million yen,compared with the result that would have been presented if the previous year accountingmethodology had been used.Reserve for Retirement Allowance and the amounts payable relating to previous years' servicecosts, etc. are included in the Reserve for Retirement Benefit.As a result of establishing a retirement benefit trust in the six months ended September 30, 2001, Income before Income Tax has increased by 9,015 million yen.

(5) From this six months ended September 30, 2001, The Bank has adopted the Accounting Standard for Financial Instruments, and so the methodology adopted to value securities, derivative contracts, and the principles by which hedge accounting has been applied, have been modified. The effect of this change in accounting policy has been an decrease in Incomebefore Income Tax of 954 million yen, compared with the result that would have been presented if the previous year accounting methodology had been used.

(6) According to "Municipal Ordinance Relating to Special Business Tax Treatments for Banksin Tokyo Metropolitan" (Tokyo Municipal Ordinance No.145 of 2000), the Bank reportedb usiness tax in Tokyo Metropolitan, which used to be reported within Income Tax (deferred),within Other Expenses. In the six months ended September 30, 2001, the Bank reported1,770 million yen in Other Expenses.


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CONSOLIDATED STATEMENTS OF RETAINED EARNINGS

Six months ended Sep. 30, Year ended2001 2000 Mar. 31, 2001

Millions of yen (Unaudited) (Unaudited)

Balance at Beginning of the Fiscal Year 24,011 33,902 33,902

Additions: - - 930

Increase Resulted from Newly Consolidated Subsidiaries 930

Deductions: 1,362 3,678 8,916

Cash Dividends 1,362 3,676 7,353

Decrease Resulted from Exclusion of Subsidiaries

Previously under Scope of Consolidation - 2 1,069

Decrease Resulted from Reversal of Revaluation

Reserve for Land - - 493

Net Income (Loss) for the Fiscal Year (33,667) 19,510 (1,904)

Balance at End of the Fiscal Year (11,017) 49,735 24,011

Note : Amounts less than one million yen are omitted.

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CONSOLIDATED STATEMENTS OF CASH FLOWSSix Months Ended September 30, Year ended

2001 2000 March 31, 2001Millions of yen (Unaudited) (Unaudited) (Unaudited)

Cash Flows from Operating ActivitiesIncome Before Income Taxes, & Minority Interests (56,055) 35,665 929

Depreciation 2,212 10,744 22,314

Amortization of Goodwill - 437 875

Equity in Earnings of Affiliates 1,307 148 799

Net Increase (Decrease) in Reserve for PossibleLoan Losses 7,370 (53,643) (67,968)

Net Increase (Decrease) in Reserve for PossibleLosses on Securities (183) (30) 70

Net Increase (Decrease) in Reserve for ContingentLiabilities Related to Loans Sold (1,905) (1,860) (1,784)

Net Increase (Decrease) in Reserve for SupportingSpecific Borrowers - (18,903) (33,823)

Net Increase (Decrease) in Reserve for RetirementAllowances - (3,599) (3,599)

Net Increase (Decrease) in Reserve for Bonus (36) - -

Net Increase (Decrease) in Reserve for Retirement Benefits (286) 3,358 927

Interest Income (49,472) (61,029) (103,459)Interest Expenses 24,364 38,316 64,357Net (Gain) Loss on Securities 60,579 13,405 (10,246)Net (Gain) Loss on Money Held in Trust - (3,445) (3,445)Net (Gain) Loss on Exchanges 7,647 1,669 6,697Net (Gain) Loss on Sales of Premises and Equipment 344 212 297Net (Gain) Loss on Establishment of Pension Trust (2,078) - -Net (Increase) Decrease in Trading Assets 9,621 112,355 85,302Net Increase (Decrease) in Trading Liabilities 1,109 (17,826) (6,587)Net (Increase) Decrease in Loans and Bills Discounted (179,347) 159,734 387,857Net Increase (Decrease) in Deposits 30,812 373,788 (225,219)Net Increase (Decrease) in Negotiable Certificates of

Deposit 389,360 (184,270) 308,410

Net Increase (Decrease) in Borrowed MoneyExcluding Subordinated Debt 13,695 (18,280) (21,144)

Net (Increase) Decrease in Due from Banks (excluding Bank of Japan) 174,344 (260,212) (253,454)

Net (Increase) Decrease in Call Loans andMonetary Receivables Bought (62,932) 77,120 70,693

Net Increase (Decrease) in Call Money and Other Fundings Related to Operating Activities 193,557 4,319 102,291

Net (Increase) Decrease in Foreign Exchanges (Assets) (151) 1,829 4,252

Net Increase (Decrease) in Foreign Exchanges (Liabilities) 54 0 (17)Net increase (Decrease) in Borrowed Money from Trust Account (262,727) (584,323) (34,215)

Interest Received (47,600) 68,940 105,909Interest Paid 23,533 (38,926) (67,243)Others, Net 66,437 (60,526) (394,061)Sub-total 343,573 (404,829) (64,280)Income Taxes Paid (Refunded) 95 1,341 697

Net Cash Provided by (Used in) Operating Activities 343,669 (403,488) (63,583)

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CONSOLIDATED STATEMENTS OF CASH FLOWS

(CONTINUED)Six Months Ended September 30, Year ended

2001 2000 March 31, 2001Millions of yen (Unaudited) (Unaudited) (Unaudited)

Cash Flows from Investing Activities

Purchases of Securities (2,390,033) (1,254,026) (3,154,889)

Proceeds from Sales of Securities 1,558,138 677,474 2,030,183

Proceeds from Maturities of Securities 563,307 318,350 464,790

Increase in Money Held in Trust - - -

Decrease in Money Held in Trust - 47,108 47,108

Expenditures for Premises and Equipment (1,510) (17,140) (29,015)

Proceeds from Sales of Premises and Equipment 120 1,228 3,208

Proceeds from Sales of Consolidated Subsidiaries 10 40 40

Net Cash Provided by (Used in) Investing Activities (269,967) (226,964) (638,574)

Cash Flows from Financing Activities

Expenditures for Repayment of Subordinated Debt (2,000) (8,000) (11,000)

Proceeds from Issuance of Subordinated Bonds 10,000 20,500 28,900

Redemption and Repurchase of Subordinated Bonds (21,546) (3,808) (48,272)

Dividends Paid (1,362) (3,676) (7,353)

Expenditures for Purchase of Treasury Stock - (15) (60)

Proceeds from Sales of Treasury Stock - 14 55

Net Cash Provided by (Used in) Financing Activities (14,908) 5,014 (37,729)

Effect of Exchange Rate Changes on Cash andCash Equivalents (0) 156 188

Net Increase (Decrease) in Cash and Cash Equivalents 58,792 (625,281) (739,699)

Cash and Cash Equivalents at Beginning of Fiscal Year 59,729 803,255 803,255

Decrease in Cash and Cash EquivalentsCaused by Exclusion from Scope of Consolidation - (42) (3,826)

Cash and Cash Equivalents at End of Interim period 118,522 177,930 59,729

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BALANCE SHEETS (TRUST ACCOUNT)

Six Months ended Sept. 30, Year endedMillions of yen 2001 2000 Mar. 31, 2001Assets:

Loans and Bills Discounted 1,509,587 2,154,155 1,767,754Securities 13,957,449 13,175,297 12,796,772 Securities of Investment Trusts 8,451,471 9,327,486 7,401,596 Overseas Investments of Investment Trusts 1,171,259 836,164 934,340 Beneficiary Rights in Trust 97,949 271,557 131,525Securities in Trust 229,785 197,353 202,693Securities Lent 492,100 381,300 364,900 Money Claims 4,125,491 1,399,699 2,958,438 Premises and Equipment 628,303 522,794 570,943 Leasing Rights on Land 15,885 15,885 15,885Other Claims 1,629,633 391,227 833,685 Bills Purchased - 5,000 1,010,000 Call Loans 1,987,957 2,351,801 3,778,728 Lending Money to Banking Account 2,474,250 2,186,388 2,736,497Cash and Due from Banks 599,881 1,418,259 661,316

Total Assets 37,371,005 34,634,372 36,165,079

Liabilities:Money Trusts 8,923,936 8,380,261 8,428,003 Pension Trusts 4,508,080 4,469,785 4,494,590 Property Formation Trusts 4,527 4,653 4,481Loan Trusts 2,747,327 3,562,096 3,302,042Investment Trusts 15,500,500 14,033,815 15,744,706Money in Trusts Other than Money Trusts 1,359,699 1,443,383 1,315,758Securities in Trust 1,120,336 936,700 956,393Money Claims in Trust 1,338,774 825,744 834,543Equipment in Trust 124,484 108,945 108,674Real Estate in Trust 104,771 117,087 111,223Leasing Rights on Land in Trust 712 707 718Composite Trusts 1,625,278 751,192 853,741Other Trusts 12,573 - 10,203

Total Liabilities 37,371,005 34,634,372 36,165,079

Note: Amounts less than one million yen are omitted.

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SEGMENT INFORMATION

1.Segment Information by Type of Business

Concurrent with the business integration, as from the six months ended Sept.30, 2001, the significance of the business of consolidated companies is small.Therefore, segment information by type of business is not shown here.

Previous Six Months Ended Trust Other Elimination andSeptember 30, 2000 Banking Financial Total Corporate Assets Consolidated

(Millions of yen)I Ordinary Income 177,997 17,199 195,197 (4,792) 190,405

(1)Ordinary Income from Outside Customers 177,073 13,331 190,405 - -(2)Internal Ordinary Income between Segments 924 3,867 4,792 (4,792) 190,405

II Ordinary Expense 146,297 17,025 163,322 (4,778) 158,543

Ordinary Profit (I-II) 31,700 174 31,875 (13) 31,861

Notes:1. Amounts less than million yen are omitted.2. In place of sales and operating profit, which are reported by companies in general, the bank discloses ordinary income and ordinary profit.3. Other financial includes guarantee business, leasing and investment trust management and investment advisory services.

2.Segment Information by Location

Concurrent with the closure of overseas branches and offices, as forthe six months ended September 30, 2001,the six months ended September 30, 2000 andthe fiscal year ended March 31, 2001,

segment information is omitted.

3. Ordinary Income from Overseas Operations

Ordinary income from overseas operations of the six months ended September 30, 2001,the six months ended September 30, 2000 andthe fiscal year ended March 31, 2001,

is less than 10% of total recurring income,Therefore, recurring Income from overseas operations for the fiscal year ended March 31, 2001 is not shown here.

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The Toyo Trust and Banking Company, LimitedMARKET VALUE INFORMATION ON SECURITIES AND MONEY HELD IN TRUST

The following includes Securities, "negotiable due from banks," contained in Cash and Due from Banks, and "commodity funds," contained in Monetary Receivables Bought.

Amounts less than one million yen are omitted.

A. End of September 30,2001

1. Available-for-sale Securities with Market ValueAs of September 30, 2001

Book Market Unrealized Profit/LossType Value Value Net Profit Loss

(Millions of yen)Stocks 808,412 654,245 (154,167) 17,703 171,871Bonds 1,726,538 1,727,224 686 3,118 2,432

Japanese Government Bonds 1,600,765 1,599,225 (1,539) 755 2,314Local Government Bonds 3,250 3,494 243 248 5Corporate Bonds and Notes 122,522 124,505 1,982 2,094 112

Others 352,583 330,572 (22,011) 297 22,308

Total 2,887,535 2,712,043 (175,491) 21,119 196,611

Market Value: Stocks: Average market value over one month period prior to the closing of the interim accounting period. Others: Market value at the end of the interim accounting period.

2. Securities without Market Value & Amount Reflected in Balance SheetsAs of September 30, 2001

Type Book Value(Millions of yen)

Available-for-sale SecuritiesBeneficiary Certificates of Loan Trusts 206,093Unlisted Stocks (excluding over-the-counter stocks) 39,182Unlisted Foreign Securities 31,664

3. Unrealized Gains (Losses) on Available-for-sale Securities

As of September 30, 2001Type Book Value

(Millions of yen)Net Unrealized Gains (Losses) (175,491)

Available-for-sale Securities (175,491)Less: Deferred Tax Assets 68,436Net Unrealized Gains (Losses), Net of Taxes (107,055)(before minority interests)

Less: Minority Interests 247Parent Company's Share of Net Unrealized Gains(Losses) Securities Held by Affiliates Accountedfor under Equity Method 2Net Unrealized Gains on Available-for-sale Securities, Net of Taxes (107,304)

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B. End of September 30,2000

1. Available-for-sale Securities with Market ValueAs of September 30, 2000

Book Market Unrealized Profit/LossType Value Value Net Profit Loss

(Millions of yen)Stocks 979,611 1,014,491 34,880 145,865 110,985Bonds 1,156,580 1,157,497 916 3,900 2,984

Japanese Government Bonds 1,032,000 1,029,507 (2,493) 287 2,781Local Government Bonds 3,776 3,923 147 161 14Corporate Bonds and Notes 120,804 124,067 3,263 3,451 188

Others 424,334 422,069 (2,265) 222 2,488

Total 2,560,527 2,594,058 33,531 149,988 116,457

Market Value: Market value at the end of the interim accounting period. Mark to the market method is not applied.

2. Securities without Market Value & Amount Reflected in Balance SheetsAs of September 30, 2000


Available-for-sale SecuritiesUnlisted Stocks (excluding over-the-counter stocks) 45,330Unlisted Bonds 15,688Unlisted Foreign Securities 14,894

3. Unrealized Gains (Losses) on Available-for-sale Securities (Trial Base)

As of September 30, 2000Type Book Value

(Millions of yen)Net Unrealized Gains (Losses) 33,531

Available-for-sale Securities 33,531Less: Deferred Tax Liabilities 13,138Net Unrealized Gains (Losses), Net of Taxes 20,392(before minority interests)

Less: Minority Interests 807Parent Company's Share of Net Unrealized Gains(Losses) Securities Held by Affiliates Accountedfor under Equity Method -Net Unrealized Gains on Available-for-sale Securities, Net of Taxes 19,584

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C. End of March 31,2001

1. Available-for-sale Securities with Market ValueAs of March 31, 2001

Book Market Unrealized Profit/LossType Value Value Net Rrofit Loss

(Millions of yen)Stocks 977,421 895,889 (81,532) 82,260 163,793Bonds 1,464,015 1,472,142 8,126 8,304 178

Japanese Government Bonds 1,328,032 1,332,508 4,475 4,600 124Local Government Bonds 1,536 1,742 206 206 -Corporate Bonds and Notes 134,447 137,890 3,443 3,497 53

Others 523,733 514,217 (9,516) 869 10,385

Total 2,965,171 2,882,248 (82,922) 91,434 174,357

Market Value: Market value at the end of the accounting period. Mark to the market method is not applied.

2. Securities without Market Value & Amount Reflected in Balance SheetsAs of March 31, 2001


Available-for-sale SecuritiesBeneficiary Certificates of Loan Trusts 89,342Unlisted Stocks (excluding over-the-counter stocks) 42,326Unlisted Foreign Securities 26,065Unlisted Bonds 18,119

3. Unrealized Gains (Losses) on Available-for-sale Securities (Trial Base)As of March 31, 2001


Net Unrealized Gains (Losses) (82,922)Available-for-sale Securities (82,922)

Less: Deferred Tax Liabilities 32,311

Net Unrealized Gains (Losses), Net of Taxes (50,610)(before minority interests)

Less: Minority Interests (437)Parent Company's Share of Net Unrealized Gains(Losses) Securities Held by Affiliates Accountedfor under Equity Method -Net Unrealized Gains on Available-for-sale Securities, Net of Taxes (50,172)

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The Toyo Trust and Banking Company, LimitedMARKET VALUE INFORMATION ON DERIVATIVES TRANSACTIONS

1. Interest Related TransactionsAs of September 30, 2001 As of September 30, 2000

Contractual Market Unrealized Contractual Market UnrealizedType Value Value Profits/Losses Value Value Profits/Losses

(Millions of yen) (Millions of yen)Over-the-Counter

Interest Rate Swaps 1,412,384 46 46 131,218 930 930Others (19,159) (544) (10) 330,231 25 254,587 871 4,587 871

Total 36 955

Notes: (1) The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives transactions to which hedge accounting is applied are excluded.

2. Currency Related TransactionsAs of September 30, 2001 As of September 30, 2000

Contractual Market Unrealized Contractual Market UnrealizedType Value Value Profits/Losses Value Value Profits/Losses


Currency Swaps - - - 1,832 161 161

Notes: (1) The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives transactions, to which hedge accounting is applied, and transactions stated in the Note (2) below are excluded.

(2) Certain Currency Swaps have been excluded from table 2. above, since such Currency Swaps have been accounted for by using the accrual method of accounting based on "Tentative Auditing Treatment relating to Adoption of 'Revised Accounting for ForeignCurrency Transaction' for Banks." (The Japanese Institute of Certified Public Accountants April 10, 1999)The Contractual Value etc. of such Currency Swaps accounted for on an accrual method is as follows:

As of September 30, 2001 As of September 30, 2000Contractual Market Unrealized Contractual Market Unrealized

Type Value Value Profits/Losses Value Value Profits/Losses(Millions of yen) (Millions of yen)

Currency Swaps 25,615 1,391 1,391 87,694 668 668

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The Toyo Trust and Banking Company, Limited(3) Foreign exchange forward contracts, currency options and some other transactions are excluded from the above table, since they are

revalued at the end of the fiscal year and their profits and losses are effected to the Consolidated Statements of Income of the Bank orthey are attached to foreign currency based receivables/payables, which are reflected to Consolidated Balance Sheets or eliminated in consolidation process. Set forth below are contractual values of foreign exchange related transactions reflected in the Statements ofIncome by revaluation at the dates i ndicated.

As of September 30, 2001 As of September 30, 2000Type Book Value Book Value


Foreign Exchange Forward Contracts 12,910 1,713,979Currency Options - 216

3. Equity Related Transactions

There are no equity related transactions.

4. Bond Related TransactionsAs of September 30, 2001 As of September 30, 2000

Unrealized UnrealizedType Contractual Value Market Value Profits/Losses Contractual Value Market Value Profits/Losses

(Millions of yen) (Millions of yen)Standardized

Bond Futures - - - 8,415 (59) (59)Over-the-Counter

- - - - - -Total - - - (59)

Notes: The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives Transactions to which hedge accounting is applied are excluded.

5. Commodity Related Transactions

There are no commodity related derivatives transactions.

6. Credit Derivatives Related Transactions

There are no credit derivatives related transactions.

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The Toyo Trust and Banking Company, LimitedMARKET VALUE INFORMATION ON DERIVATIVES TRANSACTIONS

1. Interest Related TransactionsAs of March 31, 2001

UnrealizedType Contractual Value Market Value Profits/Losses

Over 1 year (Millions of yen)Standardized

- - - -Over-the-Counter

Interest Rate SwapsReceipts Fixed, Payments Floating 638,169 608,860 18,124 18,124Receipts Floating, Payments Fixed 647,357 582,580 (17,189) (17,189)Basis Swaps 183,580 150,580 (45) (45)

OthersSold 144,013 108,913 2,165 (207)Bought 118,536 92,036 1,532 1884,587 871

Total 4,587 871

Notes: (1) The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives transactions to which hedge accounting is applied are excluded.

2. Currency Related TransactionsAs of March 31, 2001


Over 1 year (Millions of yen)Over-the-Counter

- - - -Total

Notes: (1) The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives transactions, to which hedge accounting is applied, and transactions stated in the Note (2) below are excluded.

(2) Certain Currency Swaps have been excluded from table 2. above, since such Currency Swaps have been accounted for by using the accrual method of accounting based on "Tentative Auditing Treatment relating to Adoption of 'Revised Accounting for ForeignCurrency Transaction' for Banks." (The Japanese Institute of Certified Public Accountants April 10, 1999)The Contractual Value etc. of such Currency Swaps accounted for on an accrual method is as follows:

As of March 31, 2001Unrealized

Type Contractual Value Market Value Profits/Losses(Millions of yen)

Currency Swaps 39,057 1,735 1,735

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The Toyo Trust and Banking Company, Limited(3) Foreign exchange forward contracts, currency options and some other transactions are excluded from the above table, since they are

revalued at the end of the fiscal year and their profits and losses are effected to the Consolidated Statements of Income of the Bank orthey are attached to foreign currency based receivables/payables, which are reflected to Consolidated Balance Sheets or eliminated in consolidation process. Set forth below are contractual values of foreign exchange related transactions reflected in the Statements ofIncome by revaluation at the dates i ndicated.

As of March 31, 2001Type Book Value

(Millions of yen)Standardized

-Over-the-Counter

Foreign Exchange Forward ContractsSold 454,921Bought 464,585

3. Equity Related Transactions

There are no equity related transactions.

4. Bond Related TransactionsAs of March 31, 2001


Over 1 year (Millions of yen)Standardized

Bond FuturesSold 976 - 3 3Bought - - - -

Over-the-Counter- - - -

Total 3 3

Notes: The above Profits/Losses are stated on the Consolidated Statements of Income. Derivatives Transactions to which hedge accounting is applied are excluded.

5. Commodity Related Transactions

There are no commodity related derivatives transactions.

6. Credit Derivatives Related Transactions

There are no credit derivatives related transactions.

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