Management Policy
Under the vision of “becoming a corporate group that offers financial services free from conventional frameworks,” we aim to establish a comprehensive financial service centered on banking and receivables acquisition and collection businesses, so that our performance will not be swayed by economic cycles. Regarding our revenue model, we will thoroughly reassess the value and future potential of our existing business portfolio to improve our profitability structure.
Going forward, we will accelerate this approach by reassessing the value of each business without sacred cows and building new growth strategies to maximize shareholder value. Furthermore, we are committed to a management approach that prioritizes compliance and governance, aiming to develop into a corporate group that coexists and prospers with local communities by delivering high-value-added financial services to our customers.
Medium- to Long-Term Management Strategies and Challenges to be Addressed
Financial Business in Japan
In our credit guarantee operations, during the current consolidated fiscal year, we implemented measures focusing on our core products-condominium loans, overseas real estate-backed loans, and securities-backed loans. These efforts have significantly contributed to our performance.
In the next consolidated fiscal year, we will continue to drive revenue growth by maintaining a focus on guarantees for condominium loans, securities-backed loans, and overseas real estate-backed loans.
The main challenges and measures in our credit guarantee operations are outlined below.
| Items | Challenges | Measures |
|---|---|---|
| Credit Guarantee Business for condominium loans | Continued Expansion of condominium loans |
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| Credit Guarantee Business for securities-backed loans | Development of Guarantee Products through Cross-Group Customer Collaboration | ・Improving Profitability of Securities-Backed Loans and Adding Eligible Securities
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| Other Credit Guarantee Business | Development (and Diversification) of Guarantee Products, including Overseas Real Estate-Backed Loans |
・Boosting the Spread and Utilization of Overseas Property-Backed Loan Products
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In our receivables collection operations, although the outlook remains uncertain due to persistent inflation driven by factors such as the weak yen, our Group has continued to steadily increase its balance of receivables. This is largely supported by the strong performance of internet-based credit card and consumer finance companies, which have seen rising sales even under such challenging circumstances.
Going forward, we will strive to expand our business by leveraging our strong collection capabilities to ensure stable and continuous purchase of receivables.
In addition, any impact on debtors' repayment capacity could lead to a decline in collections.
Going forward, we will continue to closely monitor debtor conditions and forecast end-of-period performance on a monthly basis. Should there be any indication of underperformance, we will promptly implement corrective measures.
In our securities operations, J Trust Global Securities Co., Ltd. (JTG Securities) is working to create added value in three core areas—“JTG Securities - Your Gateway for Global Investment,” “JTG Securities - Empowering Venture Business,” and “JTG Securities - Experts in Wealth Management”—as we aim to reach ¥1 trillion in assets under custody.
The main challenges and measures in our securities operations are outlined below.
| Items | Challenges | Measures |
|---|---|---|
| JTG Securities - Your Gateway for Global Investment | A Leading Company in Retail Bond Business |
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| JTG Securities - Empowering Venture Business | Enhancing Support Systems for Entrepreneurs |
・As a private banker for entrepreneurs, we will enhance our end-to-end support system to respond comprehensively to their needs.
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| JTG Securities - Experts in Wealth Management | Building Long-Term, Trusting Relationships with High-Net-Worth Clients | ・We will build long-term, trusting relationships with high-net-worth clients.
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Financial Business in South Korea
We will continue our efforts to secure earnings from savings bank operations during this consolidated fiscal year.
In the South Korean economy, although the base interest rate was lowered to 3.0% in November 2024, we believe that the impact of this rate cut has already been partially reflected in the funding rates of savings banks. As a result, the extent to which funding rates can be further reduced is currently limited, even if the base rate is lowered.
Furthermore, across South Korea, there has been a rising trend in delinquent loans, individual rehabilitation, and credit recovery since the COVID-19 pandemic. In addition, the regulatory environment remains challenging, as amendments to the Supervisory Regulations for Savings Banks are set to introduce phased implementation of additional loan loss provisions for multiple-debt borrowers, aimed at strengthening the soundness of savings banks.
The main challenges and measures in Financial Business in South Korea are outlined below.
| Items | Challenges | Measures |
|---|---|---|
| The uncertain South Korean economy | Initiatives to Secure Stable Revenue |
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In the receivables collection business, restrictions on asset sales have remained in place since the COVID-19 pandemic, presenting ongoing challenges. However, we aim to expand our operations by leveraging the strong collection capabilities and legal compliance we have developed over time.
Financial Business in Southeast Asia
We expect to continue expanding revenue in this consolidated fiscal year, primarily through interest revenue from the banking operations of PT Bank JTrust Indonesia Tbk. (hereinafter referred to as “J Trust Bank Indonesia”) and J Trust Royal Bank Plc. (hereinafter referred to as “J Trust Royal Bank”).
In Indonesia, although the benchmark interest rate was lowered to 6.0% in September 2024 for the first time in three years and seven months, the persistently high funding costs have put downward pressure on earnings. However, by raising lending rates in line with market conditions and maintaining a certain level of profitability, coupled with a steady increase in the balance of loans in the banking business, interest revenue has also increased.
With regard to the benchmark interest rate, as the inflation rate remains at a low level, a rate cut to 5.75% was implemented in January 2025. As further rate cuts are also anticipated going forward, we will continue to periodically adjust funding rates and lending rates accordingly.
At J Trust Bank Indonesia, the main challenges for ensuring profitability are to actively increase the balance of outstanding loans, reduce credit costs by lowering the non-performing loan (NPL) ratio, and lower the cost of funds (COF).
The main challenges and measures at J Trust Bank Indonesia are outlined below.
| Items | Challenges | Measures |
|---|---|---|
| Increase in loan receivables | Strengthening of revenue base | Daily meetings with the business department are held to strengthen lending activities. By enhancing collaboration between the business and credit screening departments, the organizational framework is being reviewed to minimize non-performing loan risks while maximizing interest revenue. Efforts are being made to proactively increase the balance of loans and corporate bonds. |
| Strengthening of capital base | Following regulatory revisions, the Indonesian Financial Services Authority (OJK) has requested the achievement of a capital adequacy ratio of 11.0% (the regulatory standard level). | As of the end of December 2024, the capital adequacy ratio was 13.83%, thereby satisfying the current requirement. Respond flexibly to regulatory and other amendments |
| Marketing activities and securing liquidity |
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Actively promote the acquisition of new deposit accounts ・Implementation of deposit programs
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We have entered into business alliance agreements with three regional banks in Japan to introduce their clients—businesses that are either expanding into or planning to expand into Indonesia—to J Trust Bank Indonesia.
With the relocation of the capital city being planned and Indonesia expected to enter a demographic bonus period for more than 40 years, we believe that by mutually leveraging each other's business resources, we can enhance the corporate value of businesses expanding into Indonesia and contribute to Indonesia’s economic development.
In Indonesia, rapid population growth and urbanization in recent years have driven up real estate prices and demand. As a result, the real estate market continues to expand in scale and has become one of the strongest sectors.
As a result, backed by a favorable real estate market, the market for receivables sales has also become more active, and the receivables collection business at PT JTRUST INVESTMENTS INDONESIA is progressing smoothly.
The main challenges and measures for maximizing the amount of recoveries are outlined below.
| Items | Challenges | Measures |
|---|---|---|
| New Purchase of receivables | Strengthening the New Purchase of Receivables |
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| Collections | Strengthening legal collection and related measures |
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In Cambodia, J Trust Royal Bank will take a proactive and progressive approach to achieving success by leveraging agility, consistency, and excellence under the slogan "Now, ACE Forward" for the year 2025.
J Trust Royal Bank will continue to focus on affluent customers as its primary client base. By leveraging strong relationship management (RM) between customer representatives and customers, the bank aims to differentiate itself from competitors through tailored lending and investment proposals. In addition, it will place emphasis on product development that meets customer needs and enhancing digital capabilities.
Starting in October 2024, J Trust Royal Bank will aim to expand its earnings by specifically promoting measures such as increasing the usage rate of VISA credit cards with a newly added installment payment option, enhancing commission revenue through strengthened life insurance sales. The Bank will also continue efforts to recover non-performing loans and curb the generation of new ones.
Real Estate Business
In the Real Estate Business, J Grand Co., Ltd. (hereinafter referred to as “J Grand”) is developing businesses targeting affluent customers, including the “J-ARC” series of investment condominium buildings built utilizing real estate and financial expertise, newly constructed value-added apartments equipped with standard IoT features under the “J-Maison” brand, and the acquisition of pre-owned apartments that are subsequently inspected by third-party home inspectors, renovated, and sold as “Vintage Residence” properties. J Grand will continue to expand its business targeting affluent customers going forward.
At J Grand, by focusing its core business on investment properties targeting affluent customers, J Grand expects steady business expansion.
In addition, Grobels Co., Ltd.,(hereinafter referred to as “Grobels”) has been steadily building a solid track record as a comprehensive real estate company engaged in land, detached houses, condominiums, income-generating properties, and crowdfunding. Going forward, Grobels intends to strengthen efforts to enhance recognition of the Group’s product brands as part of further expanding its business scale.
In order to secure stable earnings, Grobels will closely monitor the Bank of Japan's interest rate policies and other factors, and will conduct marketing research with even greater care to avoid misreading market trends and changes.
Investment Business
In the Investment Business, we will continue to make efforts to recover claims from Group Lease PCL (hereinafter referred to as “GL”).
In January 2025, we recovered €3,729,608 (approximately \607 million, converted at €1 = ¥163) through foreclosure based on a finalized judgment rendered by the Singapore court. Going forward, we will continue to strengthen our recovery efforts while controlling recovery costs, including court expenses.
Since full provision has already been made for the claims against GL, any recoveries will be recognized as revenue as they are collected.
Our Group recognizes the enhancement of shareholder returns and the sustainable improvement of corporate value through improved capital efficiency as key management priorities. The acquisition and cancellation of treasury stock are carried out in consideration of factors such as business performance, capital policies, stock prices, and overall market conditions.
In recent years, we have managed capital allocation with a balanced approach, taking into account both shareholder returns and capital investments, including capital reinforcement for Financial Business in Southeast Asia. Currently, recognizing that we have entered a phase of expansion and growth, we conducted share buybacks and cancellations during this consolidated fiscal year with the aim of enhancing shareholder returns, improving capital efficiency, and driving appropriate shareholder value creation.
In the fiscal year beginning January 1, 2025, which marks our 50th fiscal period, we plan to issue a commemorative dividend of ¥1 per share. Including the regular dividend, the total annual dividend for the fiscal year ending December 2025 is scheduled to be ¥17 per share (no interim dividend; year-end dividend of ¥17, consisting of a ¥16 regular dividend and a ¥1 commemorative dividend).
We will continue to enhance our corporate value and strive to meet the expectations of our shareholders.