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MITSUBISHI UFJ FINANCIAL GROUP INC

MITSUBISHI UFJ FINANCIAL GROUP INCMUFGEarnings & Financial Report

NYSE · Financials · Commercial Banks, NEC

Mitsubishi UFJ Financial Group, Inc. is a Japanese bank holding and financial services company headquartered in Chiyoda, Tokyo, Japan. MUFG was created in 2005 by merger between Mitsubishi Tokyo Financial Group and UFJ Holdings. These two groups in turn brought together multiple predecessor banks including Mitsubishi Bank, Yokohama Specie Bank, Sanwa Bank, and Tokai Bank.

What changed in MITSUBISHI UFJ FINANCIAL GROUP INC's 20-F — 2022 vs 2023

Top changes in MITSUBISHI UFJ FINANCIAL GROUP INC's 2023 20-F

713 paragraphs added · 722 removed · 507 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

63 edited+9 added−24 removed144 unchanged
The methodologies and data used to monitor and manage climate change-related risks also continue to evolve and currently utilize information and estimates derived from information or factors that are currently available which may be revised or replaced. In light of these and other uncertainties, we expect that climate change-related risks will increase over time.
The methodologies and data used to monitor and manage climate change-related risks also continue to evolve and currently utilize information and estimates derived from information or factors that are currently available which may be revised or replaced. In light of these and other developments and uncertainties, we expect that climate change-related risks will increase over time.
In addition, with our current investment in Morgan Stanley, we have neither a controlling interest in, nor control over the business operations of, Morgan Stanley. If Morgan Stanley makes any business decisions that are inconsistent with our interests, we may be unable to achieve the goals initially set out for the strategic alliance.
In addition, with our current investment in Morgan Stanley, we have neither a controlling interest in, nor control over the business operations of, Morgan Stanley. If Morgan Stanley makes any business decisions that are inconsistent with our interests, we may be unable to achieve the goals set out for the strategic alliance.
In particular, among other things, • such transition may adversely affect the price, liquidity, profitability, and tradability of a wide range of financial instruments, such as loans and derivatives, included in our financial assets and liabilities that reference LIBOR and other interest rate benchmarks; • we may be unable to modify contracts with our counterparties to replace the reference rate for existing contracts based on or linked to LIBOR and other interest rate benchmarks with alternative reference rates by the dates set for cessation of LIBOR and other interest rate benchmarks; • such transition may result in disputes with customers and counterparties concerning the interpretation of affected contracts or economic adjustments to the alternative reference rate adopted in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, or disputes concerning inappropriate trade practices or abuse of a dominant bargaining position in transactions with customers; • such transition may require us to respond to regulatory authorities in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates; and • our operational and risk management systems may not be fully effective to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates.
In particular, among other things, • such transition may adversely affect the price, liquidity, profitability, and tradability of a wide range of financial instruments, such as loans and derivatives, included in our financial assets and liabilities that reference LIBOR and other interest rate benchmarks; • we may be unable to modify contracts with our counterparties to replace the reference rate for existing contracts based on or linked to LIBOR and other interest rate benchmarks with alternative reference rates as planned; • such transition may result in disputes with customers and counterparties concerning the interpretation of affected contracts or economic adjustments to the alternative reference rate adopted in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, or disputes concerning inappropriate trade practices or abuse of a dominant bargaining position in transactions with customers; • such transition may require us to respond to regulatory authorities in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates; and • our operational and risk management systems may not be fully effective to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates.
In addition, if our risk assessment and disclosure relating to climate change that we make and plan to enhance with the intent to be aligned with the recommendations of the Task Force on Climate-related Financial Disclosures, or TCFD, and other standards are deemed insufficient, if our measures designed to combat climate change or facilitate the transition to a less carbon-dependent economy do not proceed as planned, if our climate change-related risk management proves not to be as effective as expected, if we fail, or are deemed to have failed, to comply with regulatory requirements relating to climate change, or if, as a result of any of the foregoing, we are considered to be failing to fulfill our responsibility to society, then our corporate value may be impaired and our business, financial condition and results of operations may be adversely affected.
In addition, if 7 Table of Conten t s our risk assessment and disclosure relating to climate change that we make and plan to enhance with the intent to be aligned with the recommendations of the Task Force on Climate-related Financial Disclosures, or TCFD, and other standards are deemed insufficient, if our measures designed to combat climate change or facilitate the transition to a less carbon-dependent economy do not proceed as planned, if our climate change-related risk management proves not to be as effective as expected, if we fail, or are deemed to have failed, to comply with regulatory requirements relating to climate change, or if, as a result of any of the foregoing, we are considered to be failing to fulfill our responsibility to society, then our corporate value may be impaired and our business, financial condition and results of operations may be adversely affected.
In anticipation of the discontinuation of the publication of LIBOR after the end of calendar year 2021, we have been taking measures to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, and our transition away from LIBOR with respect to transactions referencing LIBOR settings which ceased to be published at the end of calendar year 2021 have been mostly completed, with a strategy in place for the remainder of such transactions.
In preparation for the discontinuation of the publication of LIBOR, we have been taking measures to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, and our transition away from LIBOR with respect to transactions referencing LIBOR settings which ceased to be published at the end of calendar year 2021 have been mostly completed, with a strategy in place for the remainder of such transactions.
Our acquisition, investments and capital alliances may not proceed as planned or may be changed or dissolved, we may not achieve the synergies or other results that we expected, or we may incur impairment or valuation losses on securities acquired or intangible assets, including goodwill, recorded in connection with such business acquisitions, investments or business alliances, because of, among other things, political and social instability, stagnation of the economy, fluctuations of the financial market, inability to obtain regulatory approvals, changes in the laws, regulations or accounting standards, changes in the strategies or financial condition of our acquirees, investees or alliance partners that are inconsistent with our interests, and unanticipated changes in the local market, industry or business environment affecting our acquirees, investees or alliance partners.
Our acquisition, investments and capital alliances may not proceed as planned or may be changed or dissolved, we may not achieve the synergies or other results that we expected, or we may incur impairment or valuation losses on 8 Table of Conten t s securities acquired or intangible assets, including goodwill, recorded in connection with such business acquisitions, investments or business alliances, because of, among other things, political and social instability, stagnation of the economy, fluctuations of the financial market, inability to obtain regulatory approvals, changes in the laws, regulations or accounting standards, changes in the strategies or financial condition of our acquirees, investees or alliance partners that are inconsistent with our interests, and unanticipated changes in the local market, industry or business environment affecting our acquirees, investees or alliance partners.
In addition, we may be adversely affected because: • we are shareholders of financial institutions; • financial institutions that face difficulties may terminate or reduce financial support to borrowers, putting such borrowers under financial stress and causing our loans to such borrowers to be impaired; • we may be requested to participate in providing support to distressed financial institutions; • the government may elect to provide regulatory, tax, funding or other benefits to financial institutions under its supervision or control to strengthen their capital or increase their profitability or for other purposes, causing our competitiveness against such financial institutions to weaken; • our deposit insurance premiums may rise if deposit insurance funds prove to be inadequate; • bankruptcies or government control or other intervention of financial institutions may generally undermine the confidence of depositors in, or adversely affect the overall business environment for, financial institutions; and • negative media coverage of the financial industry or system, regardless of its accuracy and applicability to us, may harm our reputation as well as market confidence in the financial industry and system.
In addition, we may be adversely affected because: • we are shareholders of financial institutions; • financial institutions that face difficulties may terminate or reduce financial support to borrowers, putting such borrowers under financial stress and causing our loans to such borrowers to be impaired; • we may be requested to participate in providing support to distressed financial institutions; 11 Table of Conten t s • the government may elect to provide regulatory, tax, funding or other benefits to financial institutions under its supervision or control to strengthen their capital or increase their profitability or for other purposes, causing our competitiveness against such financial institutions to weaken; • our deposit insurance premiums may rise if deposit insurance funds prove to be inadequate; • bankruptcies or government control or other intervention of financial institutions may generally undermine the confidence of depositors and investors in, or adversely affect the overall business environment for, financial institutions; and • negative media coverage of the financial industry or system, regardless of its accuracy and applicability to us, may harm our reputation as well as market confidence in the financial industry and system.
Our reputation may be damaged by their negative perceptions of us and our operations in light of their concerns over human rights, the environment, public health and safety, or other corporate social responsibilities, or by our transactions or operations if they are deemed adverse to the intent and policy underlying applicable laws and regulations such as anti-money laundering, economic sanctions and competition laws as well as the prohibition on dealing with anti-social forces.
Our reputation may be damaged by their negative perceptions of us and our operations in light of their concerns over human rights, the environment, public health and safety, or other corporate social responsibilities, or by our transactions or operations if they are deemed adverse to the intent and policy underlying 15 Table of Conten t s applicable laws and regulations such as anti-money laundering, economic sanctions and competition laws as well as the prohibition on dealing with anti-social forces.
There is also growing political pressure to demand even greater internal compliance and risk management systems following several high-profile scandals and risk management failures in the financial industry. See “Item 4.B.
There is also growing political pressure to demand even greater capital and liquidity requirements and internal compliance and risk management systems following several high-profile scandals and risk management failures in the financial industry. See “Item 4.B.
We believe there is doubt as to the enforceability in Japan, in original actions or in actions brought in Japanese courts to enforce judgments of U.S. courts, of claims predicated solely upon the U.S. federal or state securities 16 T a b l e o f C o n t e n t s laws mainly because the Civil Execution Act of Japan requires Japanese courts to deny requests for the enforcement of judgments of foreign courts if foreign judgments fail to satisfy the requirements prescribed by the Civil Execution Act, including: • the jurisdiction of the foreign court be recognized under laws, regulations, treaties or conventions; • proper service of process be made on relevant defendants, or relevant defendants be given appropriate protection if such service is not received; • the judgment and proceedings of the foreign court not be repugnant to public policy as applied in Japan; and • there exist reciprocity as to the recognition by a court of the relevant foreign jurisdiction of a final judgment of a Japanese court.
We believe there is doubt as to the enforceability in Japan, in original actions or in actions brought in Japanese courts to enforce judgments of U.S. courts, of claims predicated solely upon the U.S. federal or state securities laws mainly because the Civil Execution Act of Japan requires Japanese courts to deny requests for the enforcement of judgments of foreign courts if foreign judgments fail to satisfy the requirements prescribed by the Civil Execution Act, including: • the jurisdiction of the foreign court be recognized under laws, regulations, treaties or conventions; • proper service of process be made on relevant defendants, or relevant defendants be given appropriate protection if such service is not received; • the judgment and proceedings of the foreign court not be repugnant to public policy as applied in Japan; and • there exist reciprocity as to the recognition by a court of the relevant foreign jurisdiction of a final judgment of a Japanese court.
As of March 31, 2022, the total balance of goodwill was ¥303.6 billion. U.S. GAAP requires us to test goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. For further information, see Note 6 to our consolidated financial statements.
As of March 31, 2023, the total balance of goodwill was ¥296.8 billion. U.S. GAAP requires us to test goodwill for impairment at least annually, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. For further information, see Note 6 to our consolidated financial statements.
Assuming a two-notch downgrade by all of the same credit rating agencies occurring on the same date, we estimate that the additional collateral requirements for the same MUFG group companies under their derivative contracts would have been approximately ¥179.4 billion. Rating agencies regularly evaluate us and our major subsidiaries as well as our and their respective debt securities.
Assuming a two-notch downgrade by all of the same credit rating agencies occurring on the same date, we estimate that the additional collateral postings for the same MUFG group companies under their derivative contracts would have been approximately ¥210.6 billion. Rating agencies regularly evaluate us and our major subsidiaries as well as our and their respective debt securities.
Assuming all of the relevant credit rating agencies downgraded the credit ratings of MUFG, MUFG Bank, Mitsubishi UFJ Trust and Banking and Mitsubishi UFJ Securities Holdings as of March 31, 2022 by one-notch on the same date, we estimate that MUFG and its three main subsidiaries would have been required to provide approximately ¥149.2 billion of additional collateral under their derivative contracts.
Assuming all of the relevant credit rating agencies downgraded the credit ratings of MUFG, MUFG Bank, Mitsubishi UFJ Trust and Banking and Mitsubishi UFJ Securities Holdings as of March 31, 2023 by one-notch on the same date, we estimate that MUFG and its three main subsidiaries would have been required to provide approximately ¥180.1 billion of additional collateral postings under their derivative contracts.
In addition, such incidents could create a negative public perception of our operations, systems or brand, which may in turn decrease customer and market confidence and materially and adversely affect our business, operating results and financial condition.
In addition, such 13 Table of Conten t s incidents could create a negative public perception of our operations, systems or brand, which may in turn decrease customer and market confidence and materially and adversely affect our business, operating results and financial condition.
We hold approximately 21.5% of the voting rights in Morgan Stanley as of March 31, 2022 and continue to hold approximately $521.4 million of perpetual non-cumulative non-convertible preferred stock with a 10% dividend. In addition, we currently have two representatives on Morgan Stanley’s board of directors.
We hold approximately 22.6% of the voting rights in Morgan Stanley as of March 31, 2023 and continue to hold approximately $521.4 million of perpetual non-cumulative non-convertible preferred stock with a 10% dividend. In addition, we currently have two representatives on Morgan Stanley’s board of directors.
ICE Benchmark Administration Limited, the LIBOR administrator, ceased publication of short-term U.S. dollar LIBOR settings and all non-U.S. dollar LIBOR settings on a representative basis after December 31, 2021, with plans to cease publication of all other U.S. dollar LBIOR settings after June 30, 2023.
ICE Benchmark Administration Limited, the LIBOR administrator, ceased publication of short-term U.S. dollar LIBOR settings and all non-U.S. dollar LIBOR settings on a representative basis after December 31, 2021, ceased publication of all other U.S. dollar LIBOR settings after June 30, 2023.
Our strategic equity investments in Japan, which account for a vast majority of our total domestic marketable equity securities, were approximately ¥4.6 trillion as of March 31, 2022.
Our strategic equity investments in Japan, which account for a vast majority of our total domestic marketable equity securities, were approximately ¥4.2 trillion as of March 31, 2023.
Factors that will affect our and our bank subsidiaries’ capital ratios or leverage ratios include: • fluctuations in our or our banking subsidiaries’ portfolios due to deterioration in the creditworthiness of borrowers and the issuers of equity and debt securities; • difficulty in refinancing or issuing instruments upon redemption or at maturity of such instruments to raise capital under terms and conditions similar to prior financings or issuances; • declines in the value of our or our banking subsidiaries’ securities portfolios; • adverse changes in foreign currency exchange rates; • adverse revisions to the capital ratio and other regulatory ratio requirements; 10 T a b l e o f C o n t e n t s • reductions in the value of our or our banking subsidiaries’ deferred tax assets; and • other adverse developments.
Factors that will affect our and our bank subsidiaries’ capital ratios or leverage ratios include: • fluctuations in our or our banking subsidiaries’ portfolios due to deterioration in the creditworthiness of borrowers and the issuers of equity and debt securities; • difficulty in refinancing or issuing instruments upon redemption or at maturity of such instruments to raise capital under terms and conditions similar to prior financings or issuances; • declines in the value of our or our banking subsidiaries’ securities portfolios; • adverse changes in foreign currency exchange rates; • adverse revisions to the capital ratio and other regulatory ratio requirements; • reductions in the value of our or our banking subsidiaries’ deferred tax assets; and • other adverse developments.
Our allowance for credit losses in our loan portfolio is based on evaluations of customers’ creditworthiness and the value of collateral we hold.
Our allowance for credit losses in our loan portfolio is based on evaluations of customers’ creditworthiness and the value of collateral we hold as well as macroeconomic trends.
Our loans to banks and other financial institutions have been more than 10% of our total loans as of each year-end in the three fiscal years ended March 31, 2022, with the percentage being 17.5% as of March 31, 2022.
Our loans to banks and other financial institutions have been more than 10% of our total loans as of each year-end in the three fiscal years ended March 31, 2023, with the percentage being 18.9% as of March 31, 2023.
Of this amount, the consumer loans provided by Mitsubishi UFJ NICOS, Co., Ltd., which is our primary consumer financing subsidiary, were ¥464.3 billion as of March 31, 2022, compared to ¥502.2 billion as of March 31, 2021.
Of this amount, the consumer loans provided by Mitsubishi UFJ NICOS, Co., Ltd., which is our primary consumer financing subsidiary, were ¥472.8 billion as of March 31, 2023, compared to ¥464.3 billion as of March 31, 2022.
As of March 31, 2022, we maintained 18.23% of External TLAC on a risk-weighted assets basis compared to the required minimum ratio of 18.00% and 9.23% of External TLAC on a leverage exposure basis compared to the required minimum ratio of 6.75%.
As of March 31, 2023, we maintained 20.22% of External TLAC on a risk-weighted assets basis compared to the required minimum ratio of 18.00% and 9.47% of External TLAC on a leverage exposure basis compared to the required minimum ratio of 6.75%.
MUFG Bank is undertaking necessary actions relating to the consent order. We have received requests and subpoenas for information from government agencies in some jurisdictions that are conducting investigations into past submissions made by panel members, including us, to the bodies that set various interbank benchmark rates as well as investigations into foreign exchange related practices of global financial institutions.
For example, we have received requests and subpoenas for information from government agencies in some jurisdictions that are conducting investigations into past submissions made by panel members, including us, to the bodies that set various interbank benchmark rates as well as investigations into foreign exchange related practices of global financial institutions.
Regulatory and market expectations regarding climate change continue to evolve rapidly and may develop in ways that diverge from our expectations or vary from market to market.
Regulatory and market expectations regarding climate change continue to evolve rapidly and generate conflicting views and approaches and may further develop in ways that diverge from our expectations or vary from market to market.
For example, we and our borrowers and counterparties may become subject to new or heightened regulatory requirements and stakeholder expectations regarding climate change, including those relating to lending, investing and advisory as well as natural resource extraction and processing, energy generation and other business activities, capital 7 T a b l e o f C o n t e n t s and liquidity adequacy, operational resiliency, and disclosure and financial reporting.
For example, we and our borrowers and counterparties may become subject to new or heightened regulatory requirements and stakeholder expectations regarding climate change, including those relating to lending, investing and advisory as well as natural resource extraction and processing, energy generation and other business activities, capital and liquidity adequacy, operational resiliency, and disclosure and financial reporting.
As of March 31, 2020, 2021 and 2022, we had ¥29.4 billion, ¥24.9 billion and ¥21.1 billion of allowance for repayment of excess interest, respectively.
As of March 31, 2021, 2022 and 2023, we had ¥24.9 billion, ¥21.1 billion and ¥12.1 billion of allowance for repayment of excess interest, respectively.
Moreover, the measures proposed or adopted vary across the major jurisdictions, increasing the cost and resources necessary to design and implement an appropriate global compliance program.
Moreover, the measures proposed or adopted vary across the 14 Table of Conten t s major jurisdictions, increasing the cost and resources necessary to design and implement an appropriate global compliance program.
For example, the geopolitical developments in Ukraine have led to the imposition of economic and financial sanctions against certain Russian banks, companies and individuals by the governments of Japan, the United States, the European Union and other jurisdictions, resulting in increased complexity in our compliance and control environment. These geopolitical tensions have also led to increased risk of cyber-attacks.
For example, the geopolitical developments in Ukraine have led to the imposition of economic and financial sanctions against certain banks, companies and individuals in or related to Russia by the governments of Japan, the United States, the European Union and other jurisdictions, resulting in increased complexity in our compliance and control environment.
Global financial institutions, including us, currently face heightened regulatory scrutiny as a result of the concerns developing in the global financial sector, and growing public pressure to demand even greater regulatory surveillance following several high-profile scandals and risk management 13 T a b l e o f C o n t e n t s failures in the financial industry.
Global financial institutions, including us, currently face heightened regulatory scrutiny as a result of the concerns developing in the global financial sector, and growing public pressure to demand even greater regulatory surveillance following several high-profile scandals and risk management failures in the financial industry.
In addition, we may incur foreign currency translation losses with respect to our foreign subsidiaries and equity method investees due to fluctuations in foreign currency exchange rates.
In addition, we may 10 Table of Conten t s incur foreign currency translation losses with respect to our foreign subsidiaries and equity method investees due to fluctuations in foreign currency exchange rates.
We have a global strategic alliance with Morgan Stanley, under which we operate two joint venture securities companies in Japan, engage in joint corporate finance operations in the United States and pursue other cooperative opportunities.
If our strategic alliance with Morgan Stanley fails, we could suffer financial or reputational loss. We have a global strategic alliance with Morgan Stanley, under which we operate two joint venture securities companies in Japan, engage in joint corporate finance operations in the United States and pursue other cooperative opportunities.
As of March 31, 2022, approximately 26.7% of our total assets were financial instruments which we measure at fair value. The aggregate carrying amount of the Japanese government and corporate bonds and foreign bonds, including U.S. Treasury bonds, that we held as of March 31, 2022 was 10.8% of our total assets.
As of March 31, 2023, approximately 23.2% of our total assets were financial instruments which we measure at fair value. The aggregate carrying amount of the Japanese government and corporate bonds and foreign bonds, including U.S. Treasury bonds, that we held as of March 31, 2023 was 11.5% of our total assets.
Interest and non-interest income in Japan represented 55.0% of our total interest and non-interest income for the fiscal year ended March 31, 2022. Furthermore, as of March 31, 2022, our loans in Japan accounted for 59.9％ of our total loans outstanding. There is significant uncertainty surrounding Japan’s economy.
Interest and non-interest income in Japan represented 41.5% of our total interest and non-interest income for the fiscal year ended March 31, 2023. Furthermore, as of March 31, 2023, our loans in Japan accounted for 57.5% of our total loans outstanding. There is significant uncertainty surrounding Japan’s economy.
A further continuation or escalation of these tensions may hamper our ability to manage such complexity or risk and may result in significant financial, reputational and other losses.
These geopolitical tensions have also led to increased risk of cyber-attacks. A further continuation or escalation of these and other geopolitical conflicts and tensions may hamper our ability to manage such complexity or risk and may result in significant financial, reputational and other losses.
Major global financial institutions currently face an increasingly stricter set of laws, regulations and standards as a result of emerging 15 T a b l e o f C o n t e n t s technologies, political and geopolitical developments, environmental, social and governance concerns, and other concerns enveloping the global financial sector.
Major global financial institutions currently face an increasingly stricter set of laws, regulations and standards as a result of emerging technologies, political and geopolitical developments, environmental, social and governance concerns, and other concerns enveloping the global financial sector.
While we closely observe conditions of our individual borrowers and industry trends, we may need to provide for additional allowance for credit losses due to deterioration in domestic and global economic conditions as well as commodity price fluctuations or other conditions specific to certain borrowers.
While we closely observe conditions of our individual borrowers and industry and macroeconomic trends, if we need to provide for additional allowance for credit losses, or the value or liquidity of collateral declines, due to deterioration in domestic and global economic conditions, commodity price fluctuations or other conditions specific to certain borrowers, we may incur significant credit losses.
Concerns 12 T a b l e o f C o n t e n t s over the impact of geopolitical tensions and conflicts in various parts of the world on Japanese companies may also adversely affect stock prices in Japan. In addition, the global trend towards further reduction in risk assets could result in lower stock prices.
Concerns over the impact of geopolitical tensions and conflicts in various parts of the world on Japanese companies may also adversely affect stock prices in Japan. In addition, the global trend towards further reduction in risk assets could result in lower stock prices.
In particular, the Japanese national government and Japanese government agency bonds accounted for 9.8% of our total assets as of March 31, 2022.
In particular, the Japanese national government and Japanese government agency bonds accounted for 10.5% of our total assets as of March 31, 2023.
Our controls may be found insufficient in addressing regulatory or public concerns relating to money laundering, economic sanctions, bribery, corruption, financial crimes, or unfair or inappropriate business practices, or in meeting market or industry rules or standards, customer protection requirements, or corporate behavior expectations. In February 2019, MUFG Bank entered into a consent order with the U.S.
Our controls may be found insufficient in addressing regulatory or public concerns relating to money laundering, economic sanctions, bribery, corruption, financial crimes, or unfair or inappropriate business practices, or in meeting market or industry rules or standards, customer protection requirements, or corporate behavior expectations.
As a strategic measure implemented in an effort to become the world’s most trusted financial group, we acquire businesses, make investments and enter into capital alliances globally. We may continue to pursue opportunities to acquire businesses, make investments and enter into capital alliances.
As a strategic measure implemented in an effort to become the world’s most trusted financial group, we acquire businesses, make investments and enter into capital alliances globally. We may continue to pursue opportunities to acquire businesses, make investments and enter into capital alliances. Our major overseas subsidiaries include Krungsri, a subsidiary in Thailand, and Bank Danamon, a subsidiary in Indonesia.
As of March 31, 2022, 67.1% of our total assets were related to Japanese domestic assets, including Japanese national government and Japanese government agency bonds, which accounted for 64.7% of our total investment securities portfolio and 9.8％ of our total assets, respectively.
As of March 31, 2023, 65.4% of our total assets were related to Japanese domestic assets, including Japanese national government and Japanese government agency bonds, which accounted for 64.1% of our total investment securities portfolio and 10.5% of our total assets, respectively.
As of March 31, 2022, based principally on the domicile of the obligors, assets related to the United States accounted for approximately 14.8% of our total assets, assets related to Asia and Oceania excluding Japan accounted for approximately 8.7% of our total assets, and assets related to Europe accounted for approximately 6.1% of our total assets.
As of March 31, 2023, based principally on the domicile of the obligors, assets related to the United States accounted for approximately 15.6% of our total assets, assets related to Asia and Oceania excluding Japan accounted for approximately 9.0% of our total assets, and assets related to Europe accounted for approximately 6.5% of our total assets.
Our competitiveness may decline because of various factors, including where: • the volume of loans made to borrowers cannot be maintained or does not increase as anticipated; • our income from interest spreads on the existing loans does not improve as anticipated; • our loan interest spread further narrows as a result of the “quantitative and qualitative monetary easing with yield curve control” program being maintained in Japan for an extended period or the negative interest rate being lowered from the current level; • our fee income does not increase as much or quickly as we aim to do; • our strategy to build a business infrastructure for new services and products through digital transformation or otherwise does not proceed as planned; • clients and business opportunities are lost, or costs and expenses significantly exceed our expectations, as a result of the ongoing or planned strategies to streamline our business portfolio, to integrate our systems, or to improve financial and operational efficiency not being achieved as expected; • we are unable to hire or retain sufficient human resources; • our foreign currency funding becomes limited or unavailable; and • we are restricted in agility or flexibility in investing in non-financial institutions under applicable laws and regulations in and outside of Japan. 8 T a b l e o f C o n t e n t s Our strategy to expand the range of our financial products and services and the geographic scope of our business globally may fail if we are unable to anticipate or manage new or expanded risks that entail such global expansion.
Our competitiveness may decline because of various factors, including where: • the volume of loans made to borrowers cannot be maintained or does not increase as anticipated; • our income from interest spreads on the existing loans does not improve as anticipated; • our loan interest spread further narrows as a result of the “quantitative and qualitative monetary easing with yield curve control” program being maintained in Japan for an extended period or the negative interest rate being lowered from the current level; • the fair value of our financial assets fluctuate to a larger extent than anticipated; • our fee income does not increase as much or quickly as we aim to do; • our strategy to build a business infrastructure for new services and products through digital transformation or otherwise does not proceed as planned; • clients and business opportunities are lost, or costs and expenses significantly exceed our expectations, as a result of the ongoing or planned strategies to streamline our business portfolio, to integrate our systems, or to improve financial and operational efficiency not being achieved as expected; • we are unable to hire or retain sufficient human resources; • our foreign currency funding becomes limited or unavailable; • we are restricted in agility or flexibility in investing in non-financial institutions under applicable laws and regulations in and outside of Japan; and • rapid and significant deposit outflows caused by deteriorated customer confidence in our financial health or market confidence in the financial industry result in a lack of liquidity.
As of March 31, 2022, our total risk-adjusted capital ratio was 14.29% compared to the minimum risk-adjusted capital ratio required of 12.01%, our Tier 1 capital ratio was 12.38% compared to the minimum Tier 1 capital ratio required of 10.01%, and our Common Equity Tier 1 capital ratio was 11.06% compared to the minimum Common Equity Tier 1 capital ratio required of 8.51%, each including a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01%.
As of March 31, 2023, our total risk-adjusted capital ratio was 13.91% compared to the minimum risk-adjusted capital ratio required of 12.04%, our Tier 1 capital ratio was 12.04% compared to the minimum Tier 1 capital ratio required of 10.04%, and our Common Equity Tier 1 capital ratio was 10.76% compared to the minimum Common Equity Tier 1 capital ratio required of 8.54%, each including a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.04%.
If our or our Japanese banking subsidiaries’ capital ratios or leverage ratios fall below the required levels, including various capital buffers, the FSA may require us to take a variety of corrective actions, including abstention from making capital distributions and suspension of our business operations.
If our or our Japanese banking subsidiaries’ capital ratios or leverage ratios fall below the required levels, including various capital buffers or a leverage buffer, the FSA may require us to take a variety of corrective actions, including abstention from making capital distributions , such as dividends, share buybacks, interest payments on, and redemption and repurchase of, Additional Tier 1 capital instruments and bonus payments, and suspension of our business operations.
While the Bank of Japan has maintained its negative interest rate policy, the central banks in the United States and other major jurisdictions have begun increasing, or signaling that they expect to increase, interest rates in response to rising inflation concerns.
While the Bank of Japan has maintained its negative interest rate policy, the central banks in the United States and other major jurisdictions have increased interest rates in response to the ongoing inflation.
Various other factors, including large-scale health issues such as the COVID-19 pandemic and disease containment measures such as restrictions on travel, store operations and other economic activities, significant or prolonged inflationary or deflationary price trends, 5 T a b l e o f C o n t e n t s the decreasing and aging demographics in Japan, stagnation or deterioration of economic and market conditions in other countries, growing global competition, and trade conflicts, may also have a material negative impact on the Japanese economy.
Various other factors, including large-scale public health issues, significant or prolonged inflationary or deflationary price trends, the decreasing and aging demographics in Japan, stagnation or deterioration of economic and market conditions in other countries, 5 Table of Conten t s growing global competition, and trade conflicts, may also have a material negative impact on the Japanese economy.
Reforms of London Interbank Offered Rate and other interest rate benchmarks could adversely affect our business, financial condition and results of operations. We have various transactions, including derivatives, loans, bonds, and securitized products, that reference London Interbank Offered Rate, or LIBOR, and other interest rate benchmarks.
We have various transactions, including derivatives, loans, bonds, and securitized products, that reference London Interbank Offered Rate, or LIBOR, and other interest rate benchmarks.
Credit losses may 11 T a b l e o f C o n t e n t s also increase if we elect, or are forced by economic or other considerations, to sell or write off our problem loans at a larger discount, in a larger amount or in a different time or manner, than we may otherwise want.
These practices may substantially increase our exposure to troubled borrowers and increase our losses. Credit losses may also increase if we elect, or are forced by economic or other considerations, to sell or write off our problem loans at a larger discount, in a larger amount or in a different time or manner, than we may otherwise want.
We may provide additional loans, equity capital or other forms of support to troubled borrowers in order to facilitate their restructuring and revitalization efforts. We may also forbear from exercising some or all of our rights as a creditor against them, and we may forgive loans to them in conjunction with their debt restructurings.
We may also forbear from exercising some or all of our rights as a creditor against them, and we may forgive loans to them in conjunction with their debt restructurings.
Declining asset quality and other financial problems may exist, arise or worsen at some domestic and foreign financial institutions, including banks, non-bank lending and credit institutions, securities companies and insurance companies.
Declining asset quality and other financial problems may exist, arise or worsen at some domestic and foreign financial institutions, including banks, non-bank lending and credit institutions, securities companies and insurance companies. Such problems recently manifested in a series of high-profile failures of financial institutions in the United States and Europe.
In addition, our redundancy and backup measures may not be sufficient to avoid a material disruption in our operations, and our contingency and business continuity plans may not address all eventualities that may occur in the event of a material disruption caused by a large-scale natural disaster.
In addition, our redundancy and backup measures may not be sufficient to avoid a material disruption in our operations, and our contingency and business continuity plans may not address all eventualities that may occur in the event of a material disruption caused by a large-scale natural disaster. 6 Table of Conten t s Reforms of London Interbank Offered Rate and other interest rate benchmarks could adversely affect our business, financial condition and results of operations.
As of the same date, our leverage ratio was 5.14% compared to the minimum leverage ratio required of 3.00%. Basel III risk measurement reforms are expected to be phased in from 2024. Our capital and leverage ratios are calculated in accordance with Japanese banking regulations based on information derived from our financial statements prepared in accordance with Japanese GAAP.
Basel III risk measurement reforms are expected to be phased in from 2024. Our capital and leverage ratios are calculated in accordance with Japanese banking regulations based on information derived from our financial statements prepared in accordance with Japanese GAAP. The Financial Stability Board has identified us as one of G-SIBs.
As the list of G-SIBs is expected to be updated annually, we may be required to meet stricter capital ratio requirements. G-SIBs are currently expected to become subject to a leverage ratio surcharge in 2023.
The banks that are included in the list of G-SIBs are subject to a capital surcharge to varying degrees depending on the bucket to which each bank is allocated. As the list of G-SIBs is expected to be updated annually, we may be required to meet stricter capital ratio requirements.
If the economic conditions in Japan or other parts of the world, including emerging countries, or in particular industries, including the real estate industry, to which we have significant credit risk exposure, or the industries that may be adversely affected by climate change or public health issues such as the COVID-19 pandemic, worsen, or if emerging market currencies depreciate against major currencies, or if geopolitical conflicts such as the geopolitical developments in Ukraine and the ensuing imposition of sanctions and other response measures adversely affect global or local economic conditions or particular industries, our problem loans and credit-related expenses and losses may increase.
If the economic conditions in Japan or other parts of the world, including emerging countries, or in particular industries, including the real estate industry, to which we have significant credit risk exposure, worsen, or if climate change, public health issues, geopolitical conflicts, fluctuations in commodity, real estate or stock prices or in interest or foreign exchange rates, changes in the competitive environment or other developments adversely affect global or local economic conditions or particular industries or borrowers, our problem loans and credit-related expenses and losses may increase.
In addition, we may be required to incur significant costs and expenses, including those incurred for preventive or remedial measures, to deal with the consequences of such external events. As a result, our business, operating results and financial condition may be materially and adversely affected.
We may also be required to incur significant costs and expenses, including those incurred for preventive or remedial measures, to deal with the consequences of such external events. In addition, such external events may negatively impact the economic conditions in the markets we or our customers operate.
However, with respect to transactions referencing U.S. dollar LIBOR settings which are expected to cease to be published at the end of June of calendar year 2023, we continue to take measures to complete our transition away from LIBOR.
With respect to transactions referencing U.S. dollar LIBOR settings which ceased to be published at the end of June 2023, we continue to take measures to complete our transition away from U.S. dollar LIBOR, while legislative solutions have been developed to address existing contracts that cannot feasibly be transitioned away from U.S. dollar LIBOR.
During the fiscal year ended March 31 , 2022, the average balance of our foreign interest-earning assets was ¥100,705.1 billion and the average balance of our foreign interest-bearing liabilities was ¥67,920.5 billion, representing 36.5% of our average total interest-earning assets and 24.3% of our average total intere st-bearing liabilities during the same period.
During the fiscal year ended March 31 , 2023, the average balance of our foreign interest-earning assets was ¥115,159.2 billion and the average balance of our foreign interest-bearing liabilities was ¥76,295.0 billion, representing 39.6% of our average total interest-earning assets and 25.9% of our average total intere st-bearing liabilities during the same period.
In addition, ADS holders may not be able to exercise their rights as ADS holders due to delays in the depositary transmitting our shareholder communications to ADS holders.
In addition, ADS holders may not be able to exercise their rights as ADS holders due to delays in the depositary transmitting our shareholder communications to ADS holders. For a detailed discussion of the rights of ADS holders and the terms of the deposit agreement, see Exhibit 2(c) to this Annual Report. 16 Table of Conten t s
For instance, bank internal financial transaction systems or automatic teller machines may become the 14 T a b l e o f C o n t e n t s target of cyber-attacks for monetary gain, and bank internal information systems may become the target of confidential information theft.
Cyber-attacks, unauthorized access and computer viruses are becoming increasingly more sophisticated and more difficult to predict, detect and prevent. For instance, bank internal financial transaction systems or automatic teller machines may become the target of cyber-attacks for monetary gain, and bank internal information systems may become the target of confidential information theft.
Uncertainty over the Japanese and global economies still remain not only because of the unpredictability of the timing of containment of COVID-19, particularly with the emergence of new viral variants, but also because of such other factors as instabilities resulting from the geopolitical developments in Ukraine, concerns over political developments in the United States, the possible negative impact on international trade resulting from shifts in the trade policies of various countries and regions, concerns over the U.S.-China conflict, inflation concerns, interruptions in global supply of commodities and international trade, political turmoil in various regions around the world, changes in the monetary and fiscal policies in major jurisdictions, and rapid and significant fluctuations in foreign exchange rates.
Uncertainty over the Japanese and global economies still remain because of such other factors as concerns over political developments in the United States, concerns over the U.S.-China conflict, geopolitical instabilities and conflicts, interruptions in international supply chains and trade, and political turmoil in various regions around the world.
Our results of operations may be materially affected by deterioration of economic conditions in Japan and around the world. Economic conditions in Japan and around the world may deteriorate due to various factors such as large-scale health issues and disease containment measures in Japan and other countries and regions as well as international geopolitical instabilities.
Our results of operations may be materially affected by deterioration of economic conditions in Japan and around the world.
An increase in problem loans and credit-related expenses and losses would adversely affect our results of operations, weaken our financial condition and erode our capital base. For example, the effect of the COVID-19 pandemic on our credit portfolio has been significant, resulting in increases in our problem loans and credit-related expenses and losses.
An increase in problem loans and credit-related expenses and losses would adversely affect our results of operations, weaken our financial condition and erode our capital base. We may provide additional loans, equity capital or other forms of support to troubled borrowers in order to facilitate their restructuring and revitalization efforts.
Removed
Furthermore, external events, such as earthquakes, typhoons, floods and other natural disasters, and terrorism, in addition to health pandemics or epidemics as well as geopolitical conflicts and ensuing economic and financial sanctions and other political and social conflicts, may cause deterioration in economic conditions and market instability in affected areas.
Added
Economic conditions in Japan and around the world may deteriorate due to various factors such as global inflation trends, changes in the monetary and fiscal policies in major jurisdictions and the fiscal condition of major countries, rapid and significant fluctuations in foreign exchange rates, and concerns and developments affecting financial institutions.
Removed
In addition, the COVID-19 pandemic has required us to temporarily close some of our business locations, resulted in reduction in our and our vendors’ operational capacity due to restrictions on mobility, and had other negative impact on us.
Added
As a result, our business, operating results and financial condition may be materially and adversely affected.
Removed
We have taken 6 T a b l e o f C o n t e n t s various measures designed to ensure the safety of our employees and vendors as well as the continuity of our operations.
Added
Our strategy to expand the range of our financial products and services and the geographic scope of our business globally may fail if we are unable to anticipate or manage new or expanded risks that entail such global expansion.
Removed
For example, we have made adjustments to our workforce management designed to increase flexibility to minimize infection, including enhancement of remote work capabilities. If the pandemic impacts our workforce or vendors and results in disruptions in our business operations or if our workforce management adjustments result in cybersecurity vulnerabilities and data losses, we may be further adversely affected.
Added
As of the same date, our leverage ratio was 4.70% compared to the minimum leverage ratio required of 3.75%, which is the sum of a minimum leverage ratio requirement at 3.00% plus a leverage ratio buffer set at 50% of the G-SIB surcharge.
Removed
Our major overseas subsidiaries include MUFG Americas Holdings, a wholly owned subsidiary in the United States, Krungsri, a subsidiary in Thailand, and Bank Danamon, a subsidiary in Indonesia.
Added
On and after April 1, 2024, the applicable minimum leverage ratio requirement is expected to be raised to 3.15%, and the applicable leverage ratio buffer requirement is expected to be set at 50% of a G-SIB surcharge plus an additional 0.05%, while deposits with the Bank of Japan will continue to be excluded from the leverage 9 Table of Conten t s exposure for the purpose of the calculation of the leverage ratio, in light of exceptional macroeconomic conditions and other circumstances.
Removed
Unexpected changes in the planned sale of MUFG Union Bank may adversely affect our strategy, financial condition or operating results. In September 2021, we agreed with U.S. Bancorp to the sale of all shares in MUFG Union Bank. Although the transfer of the MUFG Union Bank shares to U.S.
Added
The required minimum ratio of External TLAC on a total exposure basis on and after April 1, 2024 is expected to be raised to 7.10%, while deposits with the Bank of Japan will continue to be excluded from the total exposure for the purpose of the calculation of the external TLAC ratio, in light of exceptional macroeconomic conditions and other circumstances.
Removed
Bancorp was originally expected to become effective in the first half of calendar year 2022, the U.S. regulatory approval process remains ongoing. Therefore, considering the current timing, the expected closing date has shifted to the second half of calendar year 2022, subject to the receipt of required regulatory approvals and the satisfaction of other closing conditions.
Added
Funding Liquidity Risk Market liquidity and other external circumstances and an actual or perceived decline in our creditworthiness could negatively affect our ability to access and maintain liquidity Our liquidity may be impaired by factors such as an inability to raise funding in financial markets, an increase in our funding costs, unexpected increases in cash or collateral requirements, an inability to sell assets or enter into or settle other transactions as 12 Table of Conten t s planned or needed, and an inability to attract or retain deposits.
Removed
If these conditions precedent are not satisfied before the expiration of any period extended in accordance with the share purchase agreement between the parties, the share transfer may not be completed as we currently expect or at all. The businesses of MUFG Union Bank that we will transfer to U.S.
Added
These situations may arise due to circumstances which we may be unable to control but which have occurred in the past, including market or economic disruptions, financial system instability, and a downgrade in our credit ratings, or circumstances specific to us, including an actual or perceived decline in our creditworthiness.
Removed
Bancorp through the share transfer exclude the Global Corporate & Investment Banking, or GCIB, business, (with certain exceptions as agreed to by the parties, including certain deposits of the GCIB business that will be retained by MUFG Union Bank), the Global Markets business to the extent related to the GCIB business, which consist of transactions with clients and investors, and certain assets and liabilities that are part of shared middle and back office functions.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

159 edited+87 added−71 removed245 unchanged
For example, we begun operating the “WM Digital Platform,” a digital tool for understanding customers’ assets and needs across the MUFG Group, at all of our business locations. Through this tool, we have established a system designed to provide comprehensive solutions on a group-wide basis to the various challenges our customers face.
For example, we have begun operating the “WM Digital Platform,” a digital tool for understanding customers’ assets and needs across the MUFG Group, at all of our business locations. Through this tool, we have established a system designed to provide comprehensive solutions on a group-wide basis to the various challenges our customers face.
In March 2020, the implementation date was deferred by one year to January 1, 2023 in light of the COVID-19 pandemic. In April 2022, the FSA announced a further deferment of the implementation date by one more year to March 31, 2024 for banking institutions with international operations conducted through foreign offices, including us.
In March 2020, the implementation date was deferred by one year to January 1, 2023 in light of the COVID-19 pandemic. In April 2022, the FSA announced a further deferment of the implementation date by one more year to March 31, 2024 for banking institutions with international operations conducted through foreign offices, including us.
MUFG is classified as a triennial full filer as applicable to large foreign and domestic banks classified within Category II and III, and MUFG is subject to alternating between submitting full and targeted resolution plans every three years.
MUFG is classified as a triennial full filer as applicable to large foreign and domestic banks classified within Category II and Category III, and MUFG is subject to alternating between submitting full and targeted resolution plans every three years.
On July 1, 2014, we integrated Bank of Tokyo-Mitsubishi UFJ’s operations in the Americas region with UNBC’s operations and changed UNBC’s corporate name to “MUFG Americas Holdings Corporation.” On the same day, Union Bank, N.A., which is MUFG Americas Holdings’ principal subsidiary and our primary operating subsidiary in the United States, was also renamed “MUFG Union Bank, N.A.” On July 1, 2016, MUFG Americas Holdings was designated as our U.S. intermediate holding company to comply with the FRB’s enhanced prudential standards.
On July 1, 2014, we integrated Bank of Tokyo-Mitsubishi UFJ’s operations in the Americas region with UNBC’s operations and changed UNBC’s corporate name to “MUFG Americas Holdings Corporation.” On the same day, Union Bank, N.A., which was MUFG Americas Holdings’ principal subsidiary and our primary operating subsidiary in the United States, was also renamed “MUFG Union Bank, N.A.” On July 1, 2016, MUFG Americas Holdings was designated as our U.S. intermediate holding company to comply with the FRB’s enhanced prudential standards.
BHC and IHC, is classified as Category IV, a classification that provides certain capital and liquidity relief from prior requirements, taking into account the size and other risk characteristics of MUFG’s U.S. subsidiary operations. On October 10, 2019, the FRB issued with the FDIC final rule amendments revising their joint resolution planning requirements of Section 165(d) of the Dodd-Frank Act.
IHC, is classified as Category IV, a classification that provides certain capital and liquidity relief from prior requirements, taking into account the size and other risk characteristics of MUFG’s U.S. subsidiary operations. On October 10, 2019, the FRB issued with the FDIC final rule amendments revising their joint resolution planning requirements of Section 165(d) of the Dodd-Frank Act.
The final rule that was issued solely by the FRB determined the applicability of certain enhanced prudential standards requirements, including liquidity stress testing and management, capital planning and stress testing, risk management, single counterparty credit limits requirements, and related regulatory reporting by categorizing all foreign banking organizations with $100 billion or more in combined U.S. assets into three categories.
The final rule that was issued solely by the FRB determined the applicability of certain enhanced prudential standards requirements, including liquidity stress testing and management, capital planning and stress testing, risk management, single counterparty credit limits requirements, and related regulatory reporting by categorizing all foreign banking organizations with $100 billion or more in combined U.S. assets into one of three categories.
The regulatory reforms also included amendments to the Money Lending Business Act which, effective June 18, 2010, abolished the so-called “gray-zone interest.” Gray-zone interest refers to interest rates exceeding the limits stipulated by the Interest Rate Restriction Act (between 15% per annum to 20% per annum depending on the amount of principal).
The regulatory reforms also included amendments to the Money Lending Business Act which, effective June 18, 2010, abolished the so-called “gray-zone interest.” Gray-zone interest refers to interest rates exceeding the limits stipulated by the Interest Rate Restriction Act (between 15% per annum and 20% per annum depending on the amount of principal).
U.S. branches and agencies of foreign banks must be licensed, and are also supervised and regulated, by a state or by the Office of the Comptroller of the Currency, or the OCC, the federal regulator of U.S. national banks. The OCC is an independent bureau of the U.S. Department of the Treasury.
U.S. branches and agencies of foreign banks must be licensed, and are also supervised and regulated, by a state or by the Office of the Comptroller of the Currency (the “OCC”), the federal regulator of U.S. national banks. The OCC is an independent bureau of the U.S. Department of the Treasury.
In addition, a financial holding company must ensure that its U.S. banking subsidiaries meet certain minimum standards under the Community Reinvestment Act of 1977. U.S. branches and agencies of subsidiary Japanese banks.
In addition, a financial holding company must ensure that its U.S. insured banking subsidiaries meet certain minimum standards under the Community Reinvestment Act of 1977. U.S. branches and agencies of subsidiary Japanese banks.
In addition, failure by MUFG Americas Holdings or MUFG Union Bank to meet minimum risk-based capital ratios of: (1) 4.5% Common Equity Tier 1 capital ratio, (2) 6.0% Tier 1 capital ratio and (3) 8.0% total capital ratio, or to a Tier 1 leverage ratio regulatory minimum requirement of 4% and a well-capitalized prompt corrective action standard of 5%, can result in additional certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a material effect on MUFG Americas Holdings’ consolidated financial statements.
In addition, failure by MUFG Americas Holdings to meet minimum risk-based capital ratios of: (1) 4.5% Common Equity Tier 1 capital ratio, (2) 6.0% Tier 1 capital ratio and (3) 8.0% total capital ratio, or to a Tier 1 leverage ratio regulatory minimum requirement of 4% and a well-capitalized prompt corrective action standard of 5%, can result in additional certain mandatory, and possibly additional discretionary, actions by regulators that, if undertaken, could have a material effect on MUFG Americas Holdings’ consolidated financial statements.
The final rules apply the same framework as to the U.S. and foreign BHCs but use a differing calibration for foreign BHCs. The final rules became effective on December 31, 2019.
The Tailoring Final Rules apply the same framework as to the U.S. and foreign BHCs but use a differing calibration for foreign BHCs. The Tailoring Final Rules became effective on December 31, 2019.
(“Bank Danamon”) Bank Danamon is a strategic subsidiary of MUFG Bank in Indonesia. Bank Danamon provides a comprehensive range of banking and other financial products and services to retail consumers, small and medium-sized enterprises, and large corporations in Indonesia. It operates an extensive distribution network spread out from Aceh to Papua, with more than 860 branches and service outlets.
(“Bank Danamon”) Bank Danamon is a strategic subsidiary of MUFG Bank in Indonesia. Bank Danamon provides a comprehensive range of banking and other financial products and services to retail consumers, small and medium-sized enterprises, and large corporations in Indonesia. It operates an extensive distribution network spread out from Aceh to Papua, with more than 879 branches and service outlets.
These rules required us to organize by July 1, 2016 all of our U.S. bank and non-bank subsidiaries, with certain limited exceptions, under a U.S. Intermediate Holdings Company ("IHC") that is subject to U.S. capital requirements and enhanced prudential standards comparable to those applicable to top-tier U.S. bank holding companies of the same size.
These rules required us to organize by July 1, 2016 all of our U.S. bank and non-bank subsidiaries, with certain limited exceptions, under a U.S. Intermediate Holdings Company (“IHC”) that is subject to U.S. capital requirements and enhanced prudential standards comparable to those applicable to top-tier U.S. bank holding companies of the same size.
Through our treasury operations, we seek to manage interest rate and liquidity risks residing in our balance sheets through, among other things, transactions designed to manage the profit and loss impact attributable to market movements based on our balance sheet analyses and forecasts. Such transactions include investments in high quality liquid securities such as Japanese government bonds and U.S.
We seek to manage interest rate and liquidity risks residing in our balance sheets through, among other things, transactions designed to manage the profit and loss impact attributable to market movements based on our balance sheet analyses and forecasts. Such transactions include investments in high quality liquid securities such as Japanese government bonds and U.S.
In response to the global financial crisis and the perception that lax supervision of the financial industry in the United States may have been a contributing cause, legislation designed to reform the system for supervision and regulation of financial firms doing business in the United States, the so-called Dodd-Frank Act, was signed into law on July 21, 2010.
In response to the global financial crisis of 2007-2008 and the perception that lax supervision of the financial industry in the United States may have been a contributing cause to the crisis, legislation designed to reform the system for supervision and regulation of financial firms doing business in the United States, the so-called Dodd-Frank Act, was signed into law on July 21, 2010.
Among them are the following: • The Development Bank of Japan, which was established for the purpose of contributing to the economic development of Japan by extending long-term loans, mainly to primary and secondary sector industries, and which was reorganized as a joint stock company in October 2008 as part of its ongoing privatization process, with the government being required by law to continue to hold 50% or more of the shares in the bank until the completion of certain specified investment operations, which the bank is required to endeavor to achieve by March 2026, and more than one-third for an unspecified period thereafter; • Japan Finance Corporation, which was formed in October 2008, through the merger of the international financial operations of the former Japan Bank for International Cooperation, National Life Finance Corporation, Agriculture, Forestry and Fisheries Finance Corporation, and Japan Finance Corporation for Small and Medium Enterprise, for the primary purposes of supplementing and encouraging the private financing of exports, imports, overseas investments and overseas economic cooperation, and supplementing private financing to the general public, small and medium-sized enterprises and those engaged in agriculture, forestry and fishery.
Among them are the following: • The Development Bank of Japan, which was established for the purpose of contributing to the economic development of Japan by extending long-term loans, mainly to primary and secondary sector industries, and which was reorganized as a joint stock company in October 2008 as part of its ongoing privatization process, with the government being required by law to continue to hold 50% or more of the shares in the bank until the completion of certain specified investment operations, which the bank is required to endeavor to achieve by March 2026, and more than one-third for an unspecified period thereafter; • Japan Finance Corporation, which was formed in October 2008, through the merger of the international financial operations of the former Japan Bank for International Cooperation, National Life Finance Corporation, Agriculture, Forestry and Fisheries Finance Corporation, and Japan Finance Corporation for Small and Medium Enterprise, for the 32 Table of Conten t s primary purposes of supplementing and encouraging the private financing of exports, imports, overseas investments and overseas economic cooperation, and supplementing private financing to the general public, small and medium-sized enterprises and those engaged in agriculture, forestry and fishery.
Under our “Strategy for Growth” strategy, in order to strengthen profitability, we will seek to promote our “Wealth Management Business,” “Approach of proposing solutions to issues faced by our corporate customers,” “Asia Business,” “GCIB and Global Markets” and “Global Asset Management / Investor Services.” Under our “Structural Reforms” strategy, to ensure resilience, we will seek to promote “Cost and risk asset control,” “Transformation of platforms and our business base,” and a “Review of our business portfolios” by reconsidering businesses that do not meet our profitability expectations and undertaking to find new business opportunities.
Under our “Strategy for Growth” strategy, in order to strengthen profitability, we seek to promote our “Wealth Management Business,” “Approach of proposing solutions to issues faced by our corporate customers,” “Asia Business,” “GCIB and Global Markets” and “Global Asset Management / Investor Services.” Under our “Structural Reforms” strategy, to ensure resilience, we will seek to promote “Cost and risk-weighted asset control,” “Transformation of platforms and our business infrastructure,” and a “Review of our business portfolios” by reconsidering businesses that do not meet our profitability expectations and undertaking to find new business opportunities.
Other Activities in Southeast Asia We have been expanding our operations in Southeast Asia with an effort to further develop our businesses abroad. In addition to MUFG Union Bank, Krungsri and Bank Danamon, we have strategic business and capital alliances with other banks in Southeast Asia, including VietinBank in Vietnam and Security Bank in the Philippines, as our Partner Banks.
Other Activities in Southeast Asia We have been expanding our operations in Southeast Asia with an effort to further develop our businesses abroad. In addition to Krungsri and Bank Danamon, we have strategic business and capital alliances with other banks in Southeast Asia, including VietinBank in Vietnam and Security Bank in the Philippines, as our Partner Banks.
Japanese banks and bank holding companies with international operations are required to maintain a minimum leverage ratio and disclose their leverage ratios calculated in accordance with the methodology prescribed in the FSA guidelines that have been adopted to implement the relevant Basel III standard.
Japanese banks and bank holding companies with international operations, including us, are required to maintain a minimum leverage ratio and disclose their leverage ratios calculated in accordance with the methodology prescribed in the FSA guidelines that have been adopted to implement the relevant Basel III standard.
The Executive Committee is established as a decision-making body for business execution and discusses and decides on important matters related to management of the operations of the MUFG Group based on the basic policies determined by the Board of Directors. The Executive Committee reports to the Board of Directors from time to time as necessary.
The committee reports to the Executive Committee and, as necessary, reports to the Board of Directors. The Executive Committee is established as a decision-making body for business execution and discusses and decides on important matters related to management of the operations of the MUFG Group based on the basic policies determined by the Board of Directors.
In addition, MUFG Bank and Mitsubishi UFJ Trust and Banking, as foreign banking organizations that have U.S. branches and agencies and are controlled by us, are subject to the FRB’s requirements that they be “well-capitalized” based on Japan’s risk based capital standards.
MUFG Bank and Mitsubishi UFJ Trust and Banking, as foreign banking organizations that have U.S. branches and agencies and are controlled by us, are subject to the FRB’s requirements that they be “well-capitalized” based on Japan’s risk based capital standards.
In November 2021, the Financial Stability Board published the latest list of G-SIBs, which includes us. The list is annually updated by the Financial Stability Board. A recovery and resolution plan must be put in place for each G-SIB, and the plans must be regularly reviewed and updated.
In November 2022, the Financial Stability Board published the latest list of G-SIBs, which includes us. The list is annually updated by the Financial Stability Board. A recovery and resolution plan must be put in place for each G-SIB, and the plans must be regularly reviewed and updated.
During the fiscal year ended March 31, 2022, our non-U.S. subsidiary, MUFG Bank, engaged in certain limited business activities with entities in, or affiliated with, Iran, including counterparties owned or controlled by the Iranian government.
During the fiscal year ended March 31, 2023, our non-U.S. subsidiary, MUFG Bank, engaged in certain limited business activities with entities in, or affiliated with, Iran, including counterparties owned or controlled by the Iranian government.
Global Commercial Banking Business Group The Global Commercial Banking Business Group provides a comprehensive array of financial products and services such as loans, deposits, fund transfers, investments and asset management services for local retail, small and medium-sized enterprise, and corporate customers across the Asia-Pacific region through our major local commercial banking subsidiaries and affiliates outside of Japan referred to as “Partner Banks.” Our Partner Banks include MUFG Union Bank in the United States, Krungsri in Thailand, Bank Danamon in Indonesia, VietinBank in Vietnam and Security Bank in the Philippines.
Global Commercial Banking Business Group The Global Commercial Banking Business Group provides a comprehensive array of financial products and services such as loans, deposits, fund transfers, investments and asset management services for local retail, small and medium-sized enterprise, and corporate customers across the Asia-Pacific region through our major local commercial banking subsidiaries and affiliates outside of Japan referred to as “Partner Banks.” Our Partner Banks include Krungsri in Thailand, Bank Danamon in Indonesia, VietinBank in Vietnam and Security Bank in the Philippines.
In order to achieve this mission, this business group aims to thoroughly refine our channels, products, services, and marketing by using digital technology, and provides the most advanced and optimal financial services for our customers.
In order to achieve this mission, this business group aims to thoroughly refine our channels, products, services, and marketing by using digital technology, and provide the most advanced and optimal financial services for our customers.
The agreement on Basel III includes the following: (1) raising the quality of capital to ensure banks are able to better absorb losses both on a going concern basis and on a gone concern basis, (2) increasing the risk coverage of the capital framework, in particular for trading activities, securitizations, exposures to off-balance sheet vehicles and counterparty credit exposures arising from derivatives, (3) raising the level of minimum capital requirements, including an increase in the minimum 31 T a b l e o f C o n t e n t s common equity requirement from 2% to 4.5%, which was phased in between January 1, 2013 and the end of the calendar year 2014, and a capital conservation buffer of 2.5%, which was phased in between January 1, 2016 and the end of the calendar year 2018, bringing the total common equity requirement to 7%, (4) introducing an internationally harmonized leverage ratio to serve as a backstop to the risk-based capital measure and to contain the build-up of excessive leverage in the system, (5) raising standards for the supervisory review process (Pillar 2) and public disclosures (Pillar 3), together with additional guidance in the areas of valuation practices, stress testing, liquidity risk management, corporate governance and compensation, (6) introducing minimum global liquidity standards consisting of both a short term liquidity coverage ratio, or LCR, and a longer term structural net stable funding ratio, or NSFR, and (7) promoting the build-up of capital buffers that can be drawn down in periods of stress, including both a capital conservation buffer and a countercyclical buffer to protect the banking sector from periods of excess credit growth.
The agreement on Basel III includes the following: (1) raising the quality of capital to ensure banks are able to better absorb losses both on a going concern basis and on a gone concern basis, (2) increasing the risk coverage of the capital framework, in particular for trading activities, securitizations, exposures to off-balance sheet vehicles and counterparty credit exposures arising from derivatives, (3) raising the level of minimum capital requirements, including an increase in the minimum common equity requirement from 2% to 4.5%, which was phased in between January 1, 2013 and the end of the calendar year 2014, and a capital conservation buffer of 2.5%, which was phased in between January 1, 2016 and the end of the calendar year 2018, bringing the total common equity requirement to 7%, (4) introducing an internationally harmonized leverage ratio to serve as a backstop to the risk-based capital measure and to contain the build-up of excessive leverage in the system, (5) raising standards for the supervisory review process (Pillar 2) and public disclosures (Pillar 3), together with additional guidance in the areas of valuation practices, stress testing, liquidity risk management, corporate governance and compensation, (6) introducing minimum global liquidity standards consisting of both a short term liquidity coverage ratio, or LCR, and a longer term structural net stable funding ratio, or NSFR, and (7) promoting the build-up of capital buffers that can be drawn down in periods of stress, including both a capital conservation buffer and a countercyclical buffer to protect the banking sector from periods of excess credit growth.
The IBA also provides that if the FRB determines that a foreign bank is not subject to comprehensive supervision or regulation on a consolidated basis by the appropriate authorities in its home country, or if there is reasonable cause to believe that the foreign bank or its affiliate has committed a violation of law or engaged in an unsafe or unsound banking practice in the United States, the FRB may order the foreign bank to terminate activities conducted at a branch or agency in the United States.
The IBA also provides that if the FRB determines that a foreign bank is not subject to comprehensive supervision or regulation on a consolidated basis by the appropriate authorities in its home country, or if there is reasonable cause to believe that the foreign bank or its affiliates have committed a violation of law or engaged in an unsafe or unsound banking practice in the United States, the FRB may order the foreign bank to terminate activities conducted at a branch or agency in the United States.
As of April 1, 2022, the Deposit Insurance Corporation charged an insurance premium equal to 0.021% per year on the deposits in the settlement accounts, and a premium equal to 0.014% per year on the deposits in other accounts.
As of April 1, 2023, the Deposit Insurance Corporation charged an insurance premium equal to 0.021% per year on the deposits in the settlement accounts, and a premium equal to 0.014% per year on the deposits in other accounts.
These higher standards include meeting the “well capitalized” and “well managed” standards for financial holding companies as defined in regulations of the FRB. Failure to meet these standards, due to inadequate capital management or shortcomings in operations, results in restrictions on the ability to engage in expanded activities as a financial holding company.
These higher standards include meeting the “well capitalized” and “well managed” standards for financial holding companies as defined in regulations of the FRB. Failure to meet these standards, due to inadequate capital management or shortcomings in operations, results in restrictions on the ability to engage in expanded activities, including making acquisitions, as a financial holding company.
Under the authority of the IBA, our banking subsidiaries, MUFG Bank and Mitsubishi UFJ Trust and Banking, operate five branches, two agencies and seven representative offices in the United States.
Under the authority of the IBA, our banking subsidiaries, MUFG Bank and Mitsubishi UFJ Trust and Banking, operate five branches, two agencies and 17 representative offices in the United States.
MUFG Americas Holdings is subject to various U.S. prudential requirements and became subject to additional requirements with the designation of MUFG Americas Holdings as our IHC as of July 1, 2016.
MUFG Americas Holdings is subject to various U.S. prudential requirements as a BHC and became subject to additional requirements with the designation of MUFG Americas Holdings as our IHC as of July 1, 2016.
Further, where the Prime Minister recognizes that the failure of a financial institution which falls into either of (a) or (b) below may cause a significant disruption to the Japanese financial market or system in Japan if measures described in (a) or measures described in (b) are not taken, the Prime Minister may, following deliberation by the Financial Response Crisis Council, confirm (nintei) that any of the following measures need to be applied to the financial institution: (a) if the financial institution is not a financial institution whose liabilities exceed its assets, the financial institution shall be placed under the special supervision by the Deposit Insurance Corporation over the financial institution’s business operations and management and the disposal of the financial institution’s assets, and the Deposit Insurance Corporation may provide the financial institution with loans or guarantees necessary to avoid the risk of significant disruption to the financial system in Japan, or subscribe for shares or subordinated bonds of, or extend subordinated loans to, the financial institution, taking into consideration the financial condition of the financial institution (“Specified Item 1 measures” ( tokutei dai ichigo sochi ) under Article 126-2, Paragraph 1, Item 1 of the Deposit Insurance Act); or 35 T a b l e o f C o n t e n t s (b) if the financial institution is a financial institution whose liabilities exceed, or are likely to exceed, its assets or which has suspended, or is likely to suspend, payments on its obligations, the financial institution shall be placed under the special supervision by the Deposit Insurance Corporation over the financial institution’s business operations and management and the disposal of the financial institution’s assets, and the Deposit Insurance Corporation may provide financial aid necessary to assist a merger, business transfer, corporate split or other reorganization in respect of such failed financial institution (“Specified Item 2 measures” ( tokutei dai nigo sochi ) under Article 126-2, Paragraph 1, Item 2 of the Deposit Insurance Act).
Further, where the Prime Minister recognizes that the failure of a financial institution which falls into either of (a) or (b) below may cause a significant disruption to the Japanese financial market or system in Japan if measures described in (a) or measures described in (b) are not taken, the Prime Minister may, following deliberation by the Financial Response Crisis Council, confirm ( nintei ) that any of the following measures need to be applied to the financial institution: (a) if the financial institution is not a financial institution whose liabilities exceed its assets, the financial institution shall be placed under the special supervision by the Deposit Insurance Corporation over the financial institution’s business operations and management and the disposal of the financial institution’s assets, and the Deposit Insurance Corporation may provide the financial institution with loans or guarantees necessary to avoid the risk of significant disruption to the financial system in Japan, or subscribe for shares or subordinated bonds of, or extend subordinated loans to, the financial institution, taking into consideration the financial condition of the financial institution (“Specified Item 1 measures” ( tokutei dai ichigo sochi ) under Article 126-2, Paragraph 1, Item 1 of the Deposit Insurance Act); or 37 Table of Conten t s (b) if the financial institution is a financial institution whose liabilities exceed, or are likely to exceed, its assets or which has suspended, or is likely to suspend, payments on its obligations, the financial institution shall be placed under the special supervision by the Deposit Insurance Corporation over the financial institution’s business operations and management and the disposal of the financial institution’s assets, and the Deposit Insurance Corporation may provide financial aid necessary to assist a merger, business transfer, corporate split or other reorganization in respect of such failed financial institution (“Specified Item 2 measures” ( tokutei dai nigo sochi ) under Article 126-2, Paragraph 1, Item 2 of the Deposit Insurance Act).
Separately, based on the categorization of MUAH as a Category IV entity under the final rules tailoring prudential standards for large banking organization (“Tailoring Final Rules”), SCCL will no longer apply to MUAH. The following paragraphs discuss the Tailoring Final Rules in greater detail.
Separately, based on the categorization of MUAH as a Category IV entity under the final rules tailoring prudential standards for large banking organization (“Tailoring Final Rules”), SCCL no longer applies to MUAH. The following paragraphs discuss the Tailoring Final Rules in greater detail.
Talent Attraction, Development and Retention Our sustainable growth and long-term success depend on our ability to attract, develop and retain talented individuals in all of our business fields. We seek to recruit highly competent talents from external candidate pools and internal human resources flexibly based on the qualifications required for the particular position to be filled.
Our sustainable growth and long-term success depend on our ability to attract, develop and retain talented individuals in all of our business fields. We seek to recruit highly competent talents from external candidate pools and internal human resources flexibly based on the qualifications required for the particular position to be filled.
Under the 2022 stress testing cycle the FRB noted that due to certain accounting reclassifications by MUFG Americas Holdings related to the planned sale of MUFG Union Bank, the Board determined not to include MUFG Americas Holdings’ detailed projections in the 2022 stress test.
Under the 2022 stress testing cycle, the FRB noted that due to certain accounting reclassifications by MUFG Americas Holdings related to the then-pending sale of MUFG Union Bank, the Board determined not to include MUFG Americas Holdings’ detailed projections in the 2022 stress test.
The requirements as of March 31, 2022 consist of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01% in addition to the 4.5% minimum Common Equity Tier 1 capital ratio. In December 2017, the Group of Central Bank Governors and Heads of Supervision released final Basel III reforms.
The requirements as of March 31, 2023 consist of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.04% in addition to the 4.5% minimum Common Equity Tier 1 capital ratio. In December 2017, the Group of Central Bank Governors and Heads of Supervision released final Basel III reforms.
For a discussion of our climate change-related risks, see “Item 3.D. Key Information—Risk Factors—Climate change could have a material adverse impact on us and our clients.” For more information on our risk management framework, see “Item 11.
For a discussion of our climate change-related risks, see “Item 3.D. Key Information—Risk Factors—Risks Related to Our Business Environment—Climate change could have a material adverse impact on us and our clients.” For more information on our risk management framework, see “Item 11.
Key Information—Risk Factors—Operational Risk.” Disclosure pursuant to Section 13(r) of the US Securities Exchange Act of 1934 We are disclosing the following information pursuant to Section 13(r) of the Securities Exchange Act of 1934 (Exchange Act), which requires an issuer to disclose whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with natural persons or entities designated by the U.S. government under specified Executive Orders.
Disclosure pursuant to Section 13(r) of the US Securities Exchange Act of 1934 We are disclosing the following information pursuant to Section 13(r) of the Securities Exchange Act of 1934 (Exchange Act), which requires an issuer to disclose whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with natural persons or entities designated by the U.S. government under specified Executive Orders.
Under tailoring of regulations applicable to domestic and foreign banks to more closely match their risk profiles which became effective December 31, 2019, MUFG Americas Holdings is classified as a Category IV firm under which it is minimally subject to biennial supervisory stress testing in even years.
Under tailoring of regulations applicable to domestic and foreign 43 Table of Conten t s banks to more closely match their risk profiles, which became effective December 31, 2019, MUFG Americas Holdings is classified as a Category IV firm under which it is minimally subject to biennial supervisory stress testing in even years.
Under the framework of the final rules, MUFG’s U.S. operations are subject to a split category treatment: (i) the combined U.S. operations are classified as Category II, subject to the most stringent requirements other than those applicable to U.S. G-SIBs; and (ii) MUAH, the U.S.
Under the framework of the final rules, MUFG’s U.S. operations are subject to a split category treatment: (i) the combined U.S. operations are classified as Category II, subject to the most stringent requirements other than those applicable to U.S. 44 Table of Conten t s G-SIBs; and (ii) MUAH, the U.S.
In addition, since we consider climate change-related risks to be our top risks requiring close attention, such risks are reviewed by the Credit & Investment Management Committee, the Credit Committee and the Risk Management Committee, which are also sub-committees formed under the Executive Committee, based on their respective expertise. Each of these sub-committees also directly reports to the Executive Committee.
In addition, since we consider climate change-related risks to be our top risks requiring close attention, such risks are reviewed by the Credit & Investment Management Committee, the Credit Committee and the Risk Management Committee, which are also sub-committees formed under the Executive Committee, based on their respective expertise. The deliberations of these sub-committees are reported to the Executive Committee.
The TLAC standard which was set forth in the regulatory notices and related materials for the implementation of the Financial Stability Board’s TLAC standard in Japan published by the FSA in March 2019 and which became applicable to (i) G-SIBs in Japan and (ii) a domestic systemically important bank designated by the FSA, or D-SIB, in Japan deemed to be in particular need for a cross-border resolution arrangement and of particular systemic significance to the Japanese financial system if it fails (such G-SIBs and D-SIB, collectively, “Covered SIBs”) on March 31, 2019, and March 31, 2021, respectively, or the Japanese TLAC Standard, requires entities designated by the FSA as Domestic Resolution Entities for Covered-SIBs to meet certain minimum external total loss-absorbing capacity, or External TLAC, requirements.
The TLAC standard which was set forth in the regulatory notices and related materials for the implementation of the Financial Stability Board’s TLAC standard in Japan published by the FSA in March 2019 and which became applicable to (i) G-SIBs in Japan in phases starting on March 31, 2019 until fully implemented on March 31, 2022, and (ii) a domestic systemically important bank designated by the FSA, or D-SIB, in Japan deemed to be in particular need for a cross-border resolution arrangement and of particular systemic significance to the Japanese financial system if it fails (such G-SIBs and D-SIB, collectively, “Covered SIBs”) in phases starting on March 31, 2021 until its scheduled full implementation on March 31, 2024, respectively, or the Japanese TLAC Standard, requires entities designated by the FSA as Domestic Resolution Entities for Covered-SIBs to meet certain minimum external total loss-absorbing capacity, or External TLAC, requirements.
Under the prompt warning system, the FSA may take precautionary measures to maintain and promote the sound operations of financial institutions, even before those financial institutions become subject to prompt corrective actions. These measures require a financial institution to enhance profitability, credit risk management, stability and cash flows. Deposit insurance system and government measures for troubled financial institutions .
Prompt warning system . Under the prompt warning system, the FSA may take precautionary measures to maintain and promote the sound operations of financial institutions, even before those financial institutions become subject to prompt corrective actions. These measures require a financial institution to enhance profitability, credit risk management, stability and cash flows.
MUFG owns a 76.88% ownership interest in Krungsri through MUFG Bank as of March 31, 2022.
MUFG owns a 76.88% ownership interest in Krungsri through MUFG Bank as of March 31, 2023.
MUFG Bank recognizes that following the withdrawal in May 2018 by the United States from the Joint Comprehensive Plan of Action, the United States has imposed secondary sanctions against non-U.S. persons who engage in or facilitate a broad range of transactions and activities involving Iran.
We recognize that following the withdrawal in May 2018 by the United States from the Joint Comprehensive Plan of Action, the United States has imposed secondary sanctions against non-U.S. persons who engage in or facilitate a broad range of transactions and activities involving Iran.
The final rule tailors the requirements for firms that do not pose the same systemic risk as the largest institutions, requiring resolution plans for these firms to be submitted on a three-year cycle.
As informed by the FRB tailoring rule, the final rule tailors the requirements for firms that do not pose the same systemic risk as the largest institutions, requiring resolution plans for these firms to be submitted on a three-year cycle.
With the application of the specified SCB, MUFG Americas Holdings capital distributions and discretionary bonus payments are subject to the following regulatory minimum risk-based capital ratios: (1) 7.8% Common Equity Tier 1 capital ratio, (2) 9.3% Tier 1 capital ratio and (3) 11.3% total capital ratio.
With the application of the specified SCB, MUFG Americas 45 Table of Conten t s Holdings capital distributions and discretionary bonus payments are subject to the following regulatory minimum risk-based capital ratios: (1) 7.8% Common Equity Tier 1 capital ratio, (2) 9.3% Tier 1 capital ratio and (3) 11.3% total capital ratio.
In April 2012, Japan Finance Corporation spun off its international operations to create Japan Bank for International Cooperation as a separate government-owned entity; 30 T a b l e o f C o n t e n t s • Japan Housing Finance Agency, which was originally established in June 1950 as the Government Housing Loan Corporation for the purpose of providing housing loans to the general public, and which was reorganized as an incorporated administrative agency and started to specialize in securitization of housing loans in April 2007; and • The Japan Post Group companies, a group of joint stock companies including Japan Post Bank, which were formed in October 2007 as part of the Japanese government’s privatization plan for the former Japan Post, a government-run public services corporation, which had been the Postal Service Agency until March 2003.
In April 2012, Japan Finance Corporation spun off its international operations to create Japan Bank for International Cooperation as a separate government-owned entity; • Japan Housing Finance Agency, which was originally established in June 1950 as the Government Housing Loan Corporation for the purpose of providing housing loans to the general public, and which was reorganized as an incorporated administrative agency and started to specialize in securitization of housing loans in April 2007; and • The Japan Post Group companies, a group of joint stock companies including Japan Post Bank, which were formed in October 2007 as part of the Japanese government’s privatization plan for the former Japan Post, a government-run public services corporation, which had been the Postal Service Agency until March 2003.
Capital Adequacy . MUFG Americas Holdings and MUFG Union Bank are required to maintain minimum capital ratios in accordance with rules issued by the U.S. Federal banking agencies. In July 2013, the U.S. Federal banking agencies issued final rules to implement the Basel Committee on Banking Supervision’s capital guidance for U.S. banking organizations, or U.S. Basel III.
Capital Adequacy . MUFG Americas Holdings is required to maintain minimum capital ratios in accordance with rules issued by the U.S. Federal banking agencies. In July 2013, the U.S. Federal banking agencies issued final rules to implement the Basel Committee on Banking Supervision’s capital guidance for U.S. banking organizations, or U.S. Basel III.
MUFG Union Bank, MUFG Bank, Mitsubishi UFJ Trust and Banking, and MUFG Americas Holdings are all “well capitalized” as defined under, and otherwise comply with, all U.S. regulatory capital requirements applicable to them.
MUFG Bank, Mitsubishi UFJ Trust and Banking, and MUFG Americas Holdings are all “well capitalized” as defined under, and otherwise comply with, all U.S. regulatory capital requirements applicable to them. Other regulated U.S. subsidiaries.
Krungsri provides a comprehensive range of banking, consumer finance, investment, asset management, and other financial products and services to retail consumers, small and medium-sized enterprises, and large corporations mainly in Thailand through 642 branches (consisting 602 banking branches, 39 automobile finance business branches and one overseas branch) and other service outlets nationwide.
Krungsri provides a comprehensive range of banking, consumer finance, investment, asset management, and other financial products and services to retail consumers, small and medium-sized enterprises, and large corporations mainly in Thailand through 614 branches (consisting of 575 banking branches, 40 automobile finance business branches and one overseas branch) and other service outlets nationwide.
Federally-licensed branches and agencies must also submit written reports concerning their assets and liabilities and other matters, to the extent required by the OCC or the FRB, and are examined at periodic intervals by the OCC and the FRB. U.S. banking subsidiaries. We indirectly own and control one U.S. bank, MUFG Union Bank, N.A.
Federally-licensed branches and agencies must also submit written reports concerning their assets and liabilities and other matters, to the extent required by the OCC or the FRB, and are examined at periodic intervals by the OCC and the FRB. U.S. banking subsidiaries. We previously owned and controlled one U.S. bank, MUFG Union Bank, N.A.
In recent years, U.S. regulatory and enforcement agencies including the SEC and the U.S. Department of Justice have significantly increased their enforcement efforts of the Foreign Corrupt Practices Act, or the FCPA.
See “—Recent regulatory developments” below. Foreign Corrupt Practices Act. In recent years, U.S. regulatory and enforcement agencies including the SEC and the U.S. Department of Justice have significantly increased their enforcement efforts of the Foreign Corrupt Practices Act, or the FCPA.
The FRB functions as our “umbrella” supervisor under amendments to the BHCA effected by the Gramm-Leach-Bliley Act of 1999, which among other things: • authorized qualifying bank holding companies to opt to become “financial holding companies,” and thereby acquire the authority to engage in an expanded list of activities; and • modified the role of the FRB by specifying new relationships between the FRB and the functional regulators of non-bank subsidiaries of both bank holding companies and financial holding companies. 39 T a b l e o f C o n t e n t s The BHCA generally prohibits each of a bank holding company and a foreign banking organization that maintains branches or agencies in the United States from, directly or indirectly, acquiring more than 5% of the voting shares of any company engaged in non-banking activities in the United States unless the bank holding company or foreign banking organization has elected to become a financial holding company, as discussed above, or the FRB has determined, by order or regulation, that such activities are so closely related to banking as to be a proper incident thereto and has granted its approval to the bank holding company or foreign banking organization for such an acquisition.
The FRB functions as our “umbrella” supervisor under amendments to the BHCA effected by the Gramm-Leach-Bliley Act of 1999, which among other things: • authorized qualifying bank holding companies to opt to become “financial holding companies,” and thereby obtain the authority to engage in an expanded list of activities; and • modified the role of the FRB by redefining the relationships between the FRB and the functional regulators of non-bank subsidiaries of both bank holding companies and financial holding companies. 41 Table of Conten t s The BHCA generally prohibits each of a bank holding company and a foreign banking organization that maintains branches or agencies in the United States from, directly or indirectly, acquiring more than 5% of the voting shares of any company engaged in non-banking activities in the United States unless the bank holding company or foreign banking organization has elected to become a financial holding company, as discussed above, or the FRB has determined, by order or regulation, that such activities are so closely related to banking as to be a proper incident thereto and has granted its approval to the bank holding company or foreign banking organization for such an acquisition.
For the fiscal year ended March 31, 2022, the aggregate fee income relating to these transactions was less than ¥5 million, representing less than 0.001 percent of our total fee income.
For the fiscal year ended March 31, 2023, the aggregate fee income relating to these transactions was less than ¥5 million, representing less than 0.0005 percent of our total fee income.
Under the Medium-term Business Plan, we will continue with our initiatives to secure business stability (focusing on business resilience) and maintain our management policy that is attractive to employees and fosters greater motivation for employee participation (engagement-focused management) 20 T a b l e o f C o n t e n t s Group Business Strategy In order to attain our vision for the three-year period to leverage our financial and digital capabilities to be the leading business partner that pioneers the future, we have identified three strategic pillars of “Corporate Transformation,” “Strategy for Growth,” and “Structural Reforms.” Under our “Corporate Transformation” strategy, we will seek to change how we operate and execute.
Under the Medium-term Business Plan, we will continue with our initiatives to secure business stability (focusing on business resilience) and maintain our management policy that is attractive to employees and fosters greater motivation for employee participation (engagement-focused management). 19 Table of Conten t s Group Business Strategy In order to attain our vision for the three-year period to leverage our financial and digital capabilities to be the leading business partner that pioneers the future, we have identified three strategic pillars of “Corporate Transformation,” “Strategy for Growth,” and “Structural Reforms.” Under our “Corporate Transformation” strategy, we seek to change how we operate and execute.
These rules supersede the U.S. federal banking agencies’ general risk-based capital rules generally referred to as Basel I, the advanced approaches rules generally referred to as Basel II, which are applicable to firms classified as Category II under the tailoring rules issued October 10, 2019, and leverage rules.
These rules supersede the U.S. federal banking agencies’ general risk-based capital rules generally referred to as Basel I, the advanced approaches rules generally referred to as Basel II, which are applicable to firms classified as Category II under the tailoring rules issued October 10, 2019, and leverage rules. MUFG Americas Holdings continues to be subject to the U.S.
Following the conversion on June 30, 2011, Morgan Stanley became our equity-method affiliate. As of March 31, 2021, we held approximately 20.2% of the voting rights in Morgan Stanley and had two representatives appointed to Morgan Stanley’s board of directors.
Following the conversion on June 30, 2011, Morgan Stanley became our equity-method affiliate. As of March 31, 2023, we held approximately 22.6% of the voting rights in Morgan Stanley and had two representatives appointed to Morgan Stanley’s board of directors.
Any such confirmation by the Prime Minister also triggers the point of non-viability clauses of Additional Tier 1 and Tier 2 instruments issued by the financial institution, causing such instruments to be written off or, if applicable, converted into equity, as described above. 36 T a b l e o f C o n t e n t s Upon the application of Specified Item 2 Measures (tokutei dai nigo sochi), a financial institution will be placed under the special supervision by, or if the Prime Minister so orders, under the special control of, the Deposit Insurance Corporation.
Any such confirmation by the Prime Minister also triggers the point of non-viability clauses of Additional Tier 1 and Tier 2 instruments issued by the financial institution, causing such instruments to be written off or, if applicable, converted into equity, as described above. 38 Table of Conten t s Upon the application of Specified Item 2 Measures ( tokutei dai nigo sochi ), a financial institution will be placed under the special supervision by, or if the Prime Minister so orders, under the special control of, the Deposit Insurance Corporation.
Included among these provisions are sweeping reforms designed to 41 T a b l e o f C o n t e n t s reduce systemic risk presented by largest financial firms, promote enhanced supervision, regulation, and prudential standards for financial firms, establish comprehensive supervision of financial markets, impose new limitations on permissible financial institution activities and investments, expand regulation of the derivatives markets, protect consumers and investors from financial abuse, and provide the government with the tools needed to manage a financial crisis.
Included among these provisions are sweeping reforms designed to reduce systemic risk presented by largest financial firms, promote enhanced supervision, regulation, and prudential standards for financial firms, establish comprehensive supervision of financial markets, impose new limitations on permissible financial institution activities and investments, expand regulation of the derivatives markets, protect consumers and investors from financial abuse, and provide the government with the tools needed to manage a financial crisis.
In addition, Bank Danamon provides financing for automotive and consumer goods through PT Adira Dinamika Multi Finance Tbk, a subsidiary of Bank Danamon. MUFG made an initial investment in December 2017 and owns a 92.47% ownership interest in Bank Danamon through MUFG Bank as of March 31, 2022.
In addition, Bank Danamon provides financing for automotive and consumer goods through PT Adira Dinamika Multi Finance Tbk, a subsidiary of Bank Danamon. 29 Table of Conten t s MUFG made an initial investment in December 2017 and owns a 92.47% ownership interest in Bank Danamon through MUFG Bank as of March 31, 2023.
Inclusion and Diversity We consider a diverse workforce and an inclusive culture to be essential for our ability to maintain organizational resilience and remain competitive. We continue to strive to develop a work environment which fosters diverse experience, backgrounds and perspectives, which, in turn, facilitate creativity and innovation.
(b) Internal Environmental Improvement We consider a diverse workforce and an inclusive and equitable culture to be essential for our ability to maintain organizational resilience and remain competitive. We continue to strive to develop a work environment which fosters diverse experience, backgrounds and perspectives, which, in turn, facilitate creativity and innovation.
In calendar year 2022, MUFG Americas Holdings was again subject to FRB supervisory Dodd-Frank Act stress testing, the results of which were released on June 23, 2022.
In calendar year 2022, MUFG Americas Holdings was subject to the FRB supervisory Dodd-Frank Act stress testing cycle, the results of which were initially released on June 27, 2022.
The IBA provides, among other things, that the FRB may examine U.S. branches and agencies of foreign banks, and each branch and agency shall be subject to on-site examination by the appropriate federal or state bank supervisor as frequently as would a U.S. bank.
Mitsubishi UFJ Trust and Banking operates a branch in New York, New York. The IBA provides, among other things, that the FRB may examine U.S. branches and agencies of foreign banks, and each branch and agency shall be subject to on-site examination by the appropriate federal or state bank supervisor as frequently as would a U.S. bank.
On May 6, 2020, the agencies, in recognition of immediate challenges of the COVID-19 pandemic, extended the next submission date by 90 days to September 29, 2021, and subsequently extended the next submission date again to December 17, 2021 as a Targeted Information Request was added to industry required submissions.
On May 6, 2020, the agencies, in recognition of immediate challenges of the COVID-19 pandemic, extended the then-upcoming submission date by 90 days to September 29, 2021, and subsequently extended the submission date again to December 17, 2021 as a Targeted Information Request focusing on covered companies’ actions in response to COVID-19 was added to industry required submissions.
In addition, Krungsri’s consolidated subsidiaries include the largest credit card issuer in Thailand with a total of 9.6 million credit card, sales finance and personal loan accounts in its portfolio, a major auto finance provider, a fast growing asset management company and a leading microfinance service provider in Thailand.
In addition, Krungsri’s consolidated subsidiaries include the largest credit card issuer in Thailand with a market share of 15%, sales finance and personal loan accounts in its portfolio, a major auto finance provider, a fast growing asset management company and a leading microfinance service provider in Thailand.
Concerning coal-fired power generation, mining (coal), oil and gas, and other specific sectors in which concerns are raised over environmental and social impacts, including climate change, we have established a finance policy and introduced a due diligence process to identify and assess the environmental and social risks or impacts associated with transactions.
In the MUFG Environmental and Social Policy Framework mentioned above, with respect to the coal-fired power generation, mining (coal), oil and gas, and other specific sectors in which concerns are raised over environmental and social impacts, including climate change, we have established our finance policy and a due diligence process to identify and assess the environmental and social risks or impacts associated with transactions has been introduced.
Private Banking Institutions Private banking institutions in Japan are commonly classified into two categories (the following numbers are based on information published by the FSA available as of February 8, 2022): • ordinary banks (121 ordinary banks and 57 foreign commercial banks with ordinary banking operations); and • trust banks (13 trust banks, including two Japanese subsidiaries of foreign financial institutions).
Private Banking Institutions Private banking institutions in Japan are commonly classified into two categories (the following numbers are based on information published by the FSA available as of January 4, 2023): • ordinary banks (121 ordinary banks and 56 foreign commercial banks with ordinary banking operations); and • trust banks (13 trust banks, including two Japanese subsidiaries of foreign financial institutions).
By combining Krungsri’s local franchise with competitive presence in the retail and small and medium-sized enterprise banking markets in Thailand with MUFG Bank’s global financial expertise, we seek to offer a wider range of high-value financial products and services to a more diverse and larger customer base. 27 T a b l e o f C o n t e n t s PT Bank Danamon Indonesia, Tbk.
By combining Krungsri’s local franchise with competitive presence in the retail and small and medium-sized enterprise banking markets in Thailand with MUFG Bank’s global financial expertise, we seek to offer a wider range of high-value financial products and services to a more diverse and larger customer base. PT Bank Danamon Indonesia, Tbk.
In addition, under the Japanese TLAC Standard, Japanese G-SIBs are allowed to count as external TLAC the Japanese Deposit Insurance Fund Reserves in an amount equivalent to 2.5% of their consolidated risk-weighted assets from March 31, 2019 and 3.5% of their consolidated risk-weighted assets from March 31, 2022.
In addition, under the Japanese TLAC Standard, Japanese G-SIBs are allowed to count as external TLAC the Japanese Deposit Insurance Fund Reserves in an amount equivalent to 3.5% of their consolidated risk-weighted assets.
The Sustainability Committee, which is a sub-committee formed under the Executive Committee and is chaired by the Chief Sustainability Officer, regularly deliberates policies on addressing climate change-related matters, including risks and opportunities arising from climate change, and monitors the progress on the MUFG Group’s measures designed to address such matters.
Directors, Senior Management and Employees—Board Practices.” The Sustainability Committee, which is a sub-committee formed under the Executive Committee and is chaired by the Chief Sustainability Officer, regularly deliberates policies on addressing sustainability-related matters, including risks and opportunities arising from such matters, and monitors the progress on the MUFG Group’s measures designed to address such matters.
The Financial Stability Board’s TLAC standard is designed to ensure that if a G-SIB fails, it has sufficient loss-absorbing and recapitalization capacity available in resolution to implement an orderly resolution that 33 T a b l e o f C o n t e n t s minimizes impacts on financial stability, ensures the continuity of critical functions, and avoids exposing public funds to loss.
The Financial Stability Board’s TLAC standard is designed to ensure that if a G-SIB 35 Table of Conten t s fails, it has sufficient loss-absorbing and recapitalization capacity available in resolution to implement an orderly resolution that minimizes impacts on financial stability, ensures the continuity of critical functions, and avoids exposing public funds to loss.
The Japanese TLAC Standard requires a Japanese G-SIB, including us, to issue and maintain TLAC debt in an amount not less than 16% of its consolidated risk-weighted assets and 6% of the applicable Basel III leverage ratio denominator on and after March 31, 2019, and not less than 18% of its consolidated risk-weighted assets and 6.75% of the applicable Basel III leverage ratio denominator on or after March 31, 2022.
The Japanese TLAC Standard currently requires a Japanese G-SIB, including us, to issue and maintain TLAC debt in an amount not less than 18% of its consolidated risk-weighted assets and 6.75% of the applicable Basel III leverage ratio denominator.
Although certain of the regulatory rules regarding the foregoing components are still pending, based on information currently available to us, other than the Volcker Rule and derivatives regulations as discussed below, the impact of these components is expected to be mainly limited to our U.S. operations and not to be material to us on a consolidated basis.
Based on information currently available to us, other than the Volcker Rule and derivatives regulations as discussed below, the impact of these components is expected to be mainly limited to our U.S. operations and not to be material to us on a consolidated basis.
There have recently been amendments to various financial regulation related laws, including the Banking Act, which includes certain deregulations of restrictions on shareholdings by banks, as described above. 37 T a b l e o f C o n t e n t s In addition, a bank is prohibited from holding shares in other companies exceeding the aggregate of its Common Equity Tier 1 capital amount and Additional Tier 1 capital amount.
There have recently been amendments to various financial regulation related laws, including the Banking Act, which include certain deregulations of restrictions on shareholdings by banks, as described above. 39 Table of Conten t s In addition, a bank is prohibited from holding shares in other companies exceeding the aggregate of its Common Equity Tier 1 capital amount and Additional Tier 1 capital amount.
On October 1, 2017, we acquired all of the shares of common stock of Mitsubishi UFJ NICOS which we did not previously own and, as a result, Mitsubishi UFJ NICOS became a wholly-owned subsidiary of MUFG. 18 T a b l e o f C o n t e n t s On December 29, 2017, Bank of Tokyo-Mitsubishi UFJ initially acquired 19.9% of the shares of common stock of PT Bank Danamon Indonesia, Tbk.
On October 1, 2017, we acquired all of the shares of common stock of Mitsubishi UFJ NICOS which we did not previously own and, as a result, Mitsubishi UFJ NICOS became a wholly-owned subsidiary of MUFG. 17 Table of Conten t s On December 29, 2017, Bank of Tokyo-Mitsubishi UFJ initially acquired 19.9% of the shares of common stock of PT Bank Danamon Indonesia, Tbk.
MUFG seeks to meet these changes with clear visions and to make the most of these challenges as opportunities for growth to become a leading force in the new era.
These developments are changing the business environment in significant ways. MUFG seeks to meet these changes with clear visions and to make the most of these challenges as opportunities for growth to become a leading force in the new era.
In addition, MUFG Securities EMEA plc registered with the SEC as a securities-based swap dealer during the fiscal year ended March 31, 2022.
Commodity Futures Trading Commission, or CFTC. In addition, MUFG Securities EMEA plc registered with the SEC as a securities-based swap dealer during the fiscal year ended March 31, 2022.
These actions include requiring such bank or bank holding company to formulate and implement capital improvement measures, requiring it to reduce assets or the bank’s business operations or take other specific actions, and issuing an order to dispose of shares of its subsidiaries or suspend all or part of the bank’s business operations. 34 T a b l e o f C o n t e n t s Capital distribution constraints system .
These actions include requiring such bank or bank holding company to formulate and implement capital improvement measures, requiring it to reduce assets or the bank’s business operations or take other specific actions, and issuing an order to dispose of shares of its subsidiaries or suspend all or part of the bank’s business operations. Capital distribution constraints system .
Human Capital Basic Policy Attracting, developing and retaining a highly qualified and motivated workforce that enables us to better serve our clients, generate long-term value for our shareholders and other stakeholders, and contribute to society, is a strategic priority for us.
(3) Human Capital 24 Table of Conten t s Attracting, developing and retaining a highly qualified and motivated workforce that enables us to better serve our clients, generate long-term value for our shareholders and other stakeholders, and contribute to society, is a strategic priority for us.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

221 edited+104 added−95 removed106 unchanged
The TLAC ratio on a risk-weighted assets basis and the required minimum ratios as of March 31, 2022 do not include the regulatory capital buffers consisting of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01%.
(3) The TLAC ratio on a risk-weighted assets basis and the required minimum ratios as of March 31, 2022 do not include the regulatory capital buffers consisting of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01%.
The allowance for credit losses includes qualitative adjustments to cover losses that are expected but were not be reflected in the modeled allowance. The determination of the allowance for credit losses for the Commercial and Krungsri segments required management to make significant judgements due to the subjectivity and uncertainty associated with the development of qualitative adjustments.
The allowance for credit losses includes qualitative adjustments to cover losses that are expected but were not reflected in the modeled allowance. The determination of the allowance for credit losses for the Commercial and Krungsri segments required management to make significant judgements due to the subjectivity and uncertainty associated with the development of qualitative adjustments.
Sources of Funding and Liquidity Our primary source of liquidity is from a large balance of deposits, mainly ordinary deposits, certificates of deposit and time deposits. Time deposits have historically shown a high rollover rate among our corporate customers and individual depositors.
Bancorp. Sources of Funding and Liquidity Our primary source of liquidity is from a large balance of deposits, mainly ordinary deposits, certificates of deposit and time deposits. Time deposits have historically shown a high rollover rate among our corporate customers and individual depositors.
The Bank of Japan has maintained its quantitative and qualitative monetary easing policy with yield curve control currently applying a negative interest rate of minus 0.1% to the "Policy-Rate Balances," which are a part of current account amounts held by financial institutions at the Bank of Japan, and aiming to keep the yield of 10-year Japanese government bonds around zero percent, and with exchange-traded fund, bond and commercial paper purchase programs.
The Bank of Japan has maintained its quantitative and qualitative monetary easing policy with yield curve control currently applying a negative interest rate of minus 0.1% to the “Policy-Rate Balances,” which are a part of current account amounts held by financial institutions at the Bank of Japan, and aiming to keep the yield of 10-year Japanese government bonds around zero percent, and with exchange-traded fund, bond and commercial paper purchase programs.
Recent Developments During the fiscal year ended March 31, 2022, we engaged in transactions to ensure adequate capital base and structure, while pursuing strategies to improve our capital management and streamline our group companies. Japan faces some challenges such as a declining birth rate, an aging society and a shrinking population, while low growth has become normalized throughout the world.
Recent Developments During the fiscal year ended March 31, 2023, we engaged in transactions to ensure adequate capital base and structure, while pursuing strategies to improve our capital management and streamline our group companies. Japan faces some challenges such as a declining birth rate, an aging society and a shrinking population, while low growth has become normalized throughout the world.
Management believes that, as of March 31, 2022, our banking subsidiaries were in compliance with all capital adequacy requirements to which they were subject. Liquidity Coverage Ratios of MUFG and Major Banking Subsidiaries in Japan The LCRs in the table below are calculated in accordance with Basel III as adopted by the FSA for the periods indicated.
Management believes that, as of March 31, 2023, our banking subsidiaries were in compliance with all capital adequacy requirements to which they were subject. Liquidity Coverage Ratios of MUFG and Major Banking Subsidiaries in Japan The LCRs in the table below are calculated in accordance with Basel III as adopted by the FSA for the periods indicated.
Of the two categories, trading account assets relating to the application of certain accounting rules represent a larger portion of our trading account losses for the fiscal year ended March 31, 2022. We generally do not separate, for financial reporting purposes, customer originated trading activities from non-customer related, proprietary trading activities.
Of the two categories, trading account assets relating to the application of certain accounting rules represent a larger portion of our trading account losses for the fiscal year ended March 31, 2023. We generally do not separate, for financial reporting purposes, customer originated trading activities from non-customer related, proprietary trading activities.
Geographic regions are based principally on the domicile of the obligors. (2) Other areas primarily include Canada, Latin America, the Caribbean and the Middle East. Loan Portfolio The following table sets forth our loans outstanding, before deduction of allowance for credit losses by class.
Geographic regions are based principally on the domicile of the obligors. (2) Other areas primarily include Canada, Latin America, the Caribbean and the Middle East. 72 Table of Contents Loan Portfolio The following table sets forth our loans outstanding, before deduction of allowance for credit losses by class.
The increase in operating expense mainly reflected the impact of foreign exchange translation on overseas expenses. Other —Consists mainly of the corporate centers of MUFG, MUFG Bank, Mitsubishi UFJ Trust and Banking and Mitsubishi UFJ Morgan Stanley Securities. The elimination of duplicated amounts of net revenues among business segments is also reflected in Other.
The increase in operating expenses mainly reflected the impact of foreign exchange translation and inflation on overseas expenses. Other —Consists mainly of the corporate centers of MUFG, MUFG Bank, Mitsubishi UFJ Trust and Banking and Mitsubishi UFJ Morgan Stanley Securities. The elimination of duplicated amounts of net revenues among business segments is also reflected in Other.
Item 5. Operating and Financial Review and Prospects. The following discussion and analysis should be read in conjunction with “Selected Statistical Data” and our consolidated financial statements and related notes. Page Summary of Financial Data 50 Business Environment 53 Recent Developments 55 A.
Item 5. Operating and Financial Review and Prospects. The following discussion and analysis should be read in conjunction with “Selected Statistical Data” and our consolidated financial statements and related notes. Page Summary of Financial Data 51 Business Environment 53 Recent Developments 55 A.
Loans to borrowers categorized as Close Watch represent those that require close monitoring as the borrower has begun to exhibit elements of potential concern with respect to its business performance and financial condition, the borrower has begun to exhibit elements of serious concern with respect to its business performance and financial condition, including business problems requiring long-term solutions, or the borrower’s loans are troubled debt restructuring or loans contractually past due 90 days or more for special reasons.
Loans to borrowers categorized as Close Watch represent those that require close monitoring as the borrower has begun to exhibit elements of potential 74 Table of Contents concern with respect to its business performance and financial condition, the borrower has begun to exhibit elements of serious concern with respect to its business performance and financial condition, including business problems requiring long-term solutions, or the borrower’s loans are troubled debt restructuring or loans contractually past due 90 days or more for special reasons.
The determination of the fair value of these reporting units requires management to make significant judgments related to significant assumptions due to the subjectively and uncertainty associated with the assumptions. The significant assumptions included projected future operating cash flows based on forecasted future income in the income approach.
The determination of the fair value of these reporting units requires management to make significant judgments related to significant assumptions due to the subjectivity and uncertainty associated with the assumptions. The significant assumptions included projected future operating cash flows based on forecasted future income in the income approach.
Quantitative and Qualitative Disclosures about Credit, Market and Other Risk—Credit Risk Management.” For the Commercial, MUFG Americas Holdings and Krungsri segments, our allowance for credit losses represents an estimate of the credit losses that are expected over the life of the financial instrument or exposure and is recognized by incorporating relevant available information relating to past events, current conditions, and reasonable and supportable forecasts.
Quantitative and Qualitative Disclosures about Credit, Market and Other Risk—Credit Risk Management.” For the Commercial and Krungsri segments, our allowance for credit losses represents an estimate of the credit losses that are expected over the life of the financial instrument or exposure and is recognized by incorporating relevant available information relating to past events, current conditions, and reasonable and supportable forecasts.
You should read the summary of financial data set forth below in conjunction with the remainder of this Item 5, “Selected Statistical Data” and our consolidated financial statements and other financial data included elsewhere in this Annual Report.
You should read the summary of financial data set forth below in conjunction with the remainder of this Item 5, “Selected Statistical Data” and our consolidated financial statements and related notes and other financial data included elsewhere in this Annual Report.
As of March 31, 2021 and 2022, the aggregate book value of our marketable equity securities under Japanese GAAP satisfied the requirements of the legislation prohibiting banks from holding equity securities in excess of their Tier 1 capital.
As of March 31, 2022 and 2023, the aggregate book value of our marketable equity securities under Japanese GAAP satisfied the requirements of the legislation prohibiting banks from holding equity securities in excess of their Tier 1 capital.
Information on the Company—Business Overview—Supervision and Regulation—Japan—Total loss-absorbing capacity.” For information on the issuances of TLAC-qualified securities, see also “—Recent Developments—Issuances of Senior Debt Securities for TLAC Purposes.” Capital Ratios, Leverage Ratio and External TLAC Ratios of MUFG The figures underlying the amounts and ratios in the table below are calculated in accordance with Japanese banking regulations based on information derived from our consolidated financial statements prepared in accordance with Japanese GAAP, as required by the FSA.
Information on the Company—Business Overview—Supervision and Regulation—Japan—Total loss-absorbing capacity.” For information on the issuances of TLAC-qualified securities, see also “—Recent Developments—Issuances of TLAC Eligible Senior Debt.” 83 Table of Contents Capital Ratios, Leverage Ratio and External TLAC Ratios of MUFG The figures underlying the amounts and ratios in the table below are calculated in accordance with Japanese banking regulations based on information derived from our consolidated financial statements prepared in accordance with Japanese GAAP, as required by the FSA.
This lower effective income tax rate primarily reflected an addition of ¥47.4 billion of valuation allowance against deferred tax assets for certain subsidiaries, which resulted in an increase of ¥52.9 billion in income tax expense and a decrease of 90.1 percentage points in the effective income tax rate for the fiscal year ended March 31, 2022.
This lower effective income tax rate primarily reflected an addition of ¥47.4 65 Table of Contents billion of valuation allowance against deferred tax assets for certain subsidiaries, which resulted in an increase of ¥52.9 billion in income tax expense and a decrease of 90.1 percentage points in the effective income tax rate for the fiscal year ended March 31, 2022.
Net foreign exchange gains for the fiscal year ended March 31, 2022 mainly reflected net foreign exchange gains related to the fair value option applied to foreign currency-denominated trading account securities such as U.S.
Net foreign exchange gains for the fiscal year ended March 31, 2023 mainly reflected net foreign exchange gains related to the fair value option applied to foreign currency-denominated trading account securities such as U.S.
However, in order to ensure more efficient management of resources, and to strengthen controls on profits and losses in each business group, we have allocated reasonably allocable fixed assets of MUFG Bank on a stand-alone basis and Mitsubishi UFJ Trust and Banking on a stand-alone basis to each business unit of such subsidiaries as of March 31, 2022.
However, in order to ensure more efficient management of resources, and to strengthen controls on profits and losses in each business group, we have allocated fixed assets of both MUFG Bank on a stand-alone basis and Mitsubishi UFJ Trust and Banking on a stand-alone basis to each business unit of such subsidiaries as of March 31, 2022.
For the discussion on our operating results for the fiscal year ended March 31, 2020, including certain comparative discussion on our operating results for the fiscal years ended March 31, 2020 and 2021, please refer to “Item 5. Operating and Financial Review and Prospects—5.A.
For the discussion on our operating results for the fiscal year ended March 31, 2021, including certain comparative discussion on our operating results for the fiscal years ended March 31, 2021 and 2022, please refer to “Item 5. Operating and Financial Review and Prospects—5.A.
We classify our loan portfolio into the following portfolio segments—Commercial, Residential, Card, MUFG Americas Holdings, Krungsri, and Other based on the grouping to determine the allowance for credit losses. We further classify the Commercial segment into Domestic and Foreign classes based on initial measurement attributes, risk characteristics, and method of monitoring and assessing credit risk.
We classify our loan portfolio into the following portfolio segments—Commercial, Residential, Card, Krungsri, and Other based on the grouping to determine the allowance for credit losses. We further classify the Commercial segment into Domestic and Foreign classes based on initial measurement attributes, risk characteristics, and method of monitoring and assessing credit risk.
However, the impact of the interest rate decrease on foreign interest income was larger than the impact of the interest rate decrease on foreign interest expense because the average balance of foreign interest-earning assets was approximately 1.5 times the average balance of foreign interest-bearing liabilities.
However, the impact of the interest rate increase on foreign interest income was larger than the impact of the interest rate increase on foreign interest expense because the average balance of foreign interest-earning assets was approximately 1.5 times the average balance of foreign interest-bearing liabilities.
Prior period business segment information has been restated to enable comparison between the relevant amounts for the fiscal years ended March 31, 2020, 2021 and 2022.
Prior period business segment information has been restated to enable comparison between the relevant amounts for the fiscal years ended March 31, 2021, 2022 and 2023.
Net trading account losses for the fiscal year ended March 31, 2022 mainly reflected net losses on trading account securities under the fair value option. During the quarter ended March 31, 2022, long-term U.S. interest rates gradually increased, and the fair value of trading account securities under the fair value option decreased at the end of March 2022.
Net trading account losses for the fiscal year ended March 31, 2023 mainly reflected net losses on trading account securities under the fair value option. During the fiscal year ended March 31, 2023, long-term U.S. interest rates gradually increased, and the fair value of trading account securities under the fair value option decreased at the end of March 2023.
Japan’s economy generally followed the global economic trends, showing a mixture of negative and positive trends, during the fiscal year ended March 31, 2022.
Japan’s economy generally followed the global economic trends, showing a mixture of negative and positive trends, during the fiscal year ended March 31, 2023.
Particularly significant judgment was required to be made when these borrowers’ performance and business sustainability were affected by changes in the external and internal business environment, including the prolonged COVID-19 pandemic and the sudden changes relating to the Russia-Ukraine situation.
Particularly significant judgment was required to be made when these borrowers’ performance and business sustainability were affected by changes in the external and internal business environment, including the prolonged COVID-19 and Russia-Ukraine situation.
Operating Results The following discussion relates to our operating results for the fiscal years ended March 31, 2022 compared to our operating results for the fiscal year ended March 31, 2021, unless otherwise noted.
Operating Results The following discussion relates to our operating results for the fiscal years ended March 31, 2023 compared to our operating results for the fiscal year ended March 31, 2022, unless otherwise noted.
The minimum capital ratios required as of March 31, 2022 include a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01%. (2) Deposits with the Bank of Japan are excluded from the leverage exposure based on notification issued by the FSA.
The minimum capital ratios required as of March 31, 2023 include a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.04%. (2) Deposits with the Bank of Japan are excluded from the leverage exposure based on notification issued by the FSA.
The economic conditions of these regions remain subject to various uncertainties, including the impact of the COVID-19 pandemic and fluctuations in the global and local economies as well as geopolitical developments. Interest Rates Interest rates remained at historical low levels in Japan under the Bank of Japan’s monetary policy.
The economic conditions of these regions remain subject to various uncertainties, including the fluctuations in the global and local economies as well as geopolitical developments. Interest Rates Interest rates remained at historical low levels in Japan under the Bank of Japan’s monetary policy.
As of March 31, 2022, we were required to maintain a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.01% in addition to the 4.5% minimum Common Equity Tier 1 capital ratio. See “Item 4.B.
As of March 31, 2023, we were required to maintain a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.04% in addition to the 4.5% minimum Common Equity Tier 1 capital ratio. See “Item 4.B.
The environment we operate in has been affected by issues including significant inflationary price trends, geographical conflicts, the COVID-19 pandemic, growing awareness of environmental and social issues, and advances in digital technologies that enable the entry of new competitors in the financial sector. These developments are changing the business environment in significant ways and with unprecedented speed.
The environment we operate in has been affected by issues including significant inflationary price trends, instability in the financial system, geographical conflicts, growing awareness of environmental and social issues, and advances in digital technologies that enable the entry of new competitors in the financial sector. These developments are changing the business environment in significant ways and with unprecedented speed.
Net revenue decreased mainly due to the lower net interest income reflecting declines in the policy interest rates in the United States, Thailand and Indonesia as well as a decrease in the automobile loan balance of Bank Danamon. The increase in operating expenses primarily resulted from expenditures for system development and regulatory compliance.
Global Commercial Banking Business Group Net revenue decreased mainly due to the lower net interest income reflecting declines in the policy interest rates in the United States, Thailand and Indonesia as well as a decrease in the automobile loan balance of Bank Danamon. The increase in operating expenses primarily resulted from expenditures for system development and regulatory compliance.
Fiscal Year Ended March 31, 2022 Compared to Fiscal Year Ended March 31, 2021 Digital Service Business Group— Covers digital-based non-face-to-face businesses servicing “mass-segment” customers, or retail customers and small and medium-sized enterprise customers, of Mitsubishi UFJ NICOS, other consumer finance companies, and MUFG Bank in Japan.
Fiscal Year Ended March 31, 2023 Compared to Fiscal Year Ended March 31, 2022 68 Table of Contents Digital Service Business Group —Covers digital-based non-face-to-face businesses servicing “mass-segment” customers, or retail customers and small and medium-sized enterprise customers, of Mitsubishi UFJ NICOS, other consumer finance companies, and MUFG Bank in Japan.
(5) Each of the ratios is calculated as the average balance of High-Quality Liquid Assets on the business days between January 4, 2022 and March 31, 2022 divided by the average amount of net cash outflows for the same 59 business days.
(5) Each of the ratios is calculated as the average balance of High-Quality Liquid Assets on the business days between January 4, 2023 and March 31, 2023 divided by the average amount of net cash outflows for the same 60 business days.
Its net revenue mainly consists of interest income from lending and deposit-taking operations and fees and commissions from investment banking services and foreign exchange and derivatives transactions.
Its net revenue mainly consists of interest income from lending 69 Table of Contents and deposit-taking operations and fees and commissions from investment banking services and foreign exchange and derivatives transactions.
Operating Results” in our annual report on Form 20-F for the fiscal year ended March 31, 2021, filed with the SEC on July 9, 2021.
Operating Results” in our annual report on Form 20-F for the fiscal year ended March 31, 2021, filed with the SEC on July 8, 2022.
The Japanese yen was on a generally depreciating trend against the Thai baht during the fiscal year ended March 31, 2022, with the exchange rate being ¥3.68 to the Thai baht as of March 31, 2022 compared to ¥3.54 to the Thai baht as of March 31, 2021.
The Japanese yen was on a generally depreciating trend against the Thai baht during the fiscal year ended March 31, 2023, with the exchange rate being ¥3.91 to the Thai baht as of March 31, 2023 compared to ¥3.68 to the Thai baht as of March 31, 2022.
Investment Portfolio Our investment securities primarily consist of Japanese government bonds and marketable equity securities. Japanese government bonds are mostly classified as available-for-sale debt securities. Our investment in Japanese government bonds is a part of our asset and liability management policy with respect to investing the amount of Japanese yen-denominated funds exceeding our net loans.
Japanese government bonds are mostly classified as available-for-sale debt securities. Our investment in Japanese government bonds is a part of our asset and liability management policy with respect to investing the amount of Japanese yen-denominated funds exceeding our net loans.
The allowance is recorded as a liability in Other liabilities. For further information, see Note 26 to our consolidated financial statements and “Item 3.D.
The allowance is recorded as a liability in Other liabilities. 88 Table of Contents For further information, see Note 26 to our consolidated financial statements and “Item 3.D.
Also, the Committee announced that the current median projection by FRB members for the federal funds rate at the end of calendar year 2022 is 3.4%. The 10-year U.S. Treasury bond yield increased from 1.742% at the end of March 2021 to 2.341% at the end of March 2022, while fluctuating between 1.173% and 2.477% during the period.
Also, the Committee announced that the current median projection by FRB members for the federal funds rate at the end of calendar year 2023 is 5.1%. The 10-year U.S. Treasury bond yield increased from 2.341% at the end of March 2022 to 3.5% at the end of March 2023, while fluctuating between 2.341% and 4.244% during the period.
Given the three-month difference between our consolidated reporting period and the reporting period of some of our subsidiaries, including MUFG Americas Holdings, our fair value assessment with respect to such subsidiaries after December 31 of each year is reflected in our consolidated financial statements for a period ending after March 31 of each year.
Given the three-month difference between our consolidated reporting period and the reporting period of some of our subsidiaries, including First Sentier Investors, our fair value assessment with respect to such subsidiaries after December 31 of each year is reflected in our consolidated financial statements for a period ending after March 31 of each year.
The fair value of a reporting unit is defined as the amount at which the unit as a whole could be bought or sold in a current transaction between willing parties. Our consolidated goodwill balance was ¥303.6 billion at March 31, 2022, which was allocated to our reporting units.
The fair value of a reporting unit is defined as the amount at which the unit as a whole could be bought or sold in a current transaction between willing parties. Our consolidated goodwill balance was ¥296.8 billion at March 31, 2023, which was allocated to our reporting units.
On a year-over-year basis, Eurozone real GDP grew by 14.6% for the quarter ended June 30, 2021, 4.1% for the quarter ended September 30, 2021, 4.7% for the quarter ended December 31, 2021, and 5.1% for the quarter ended March 31, 2022. The unemployment rate in the Eurozone declined to 6.8% in March 2022, from 8.2% in March 2021.
On a year-over-year basis, Eurozone real GDP grew by 4.3% for the quarter ended June 30, 2022, 2.5% for the quarter ended September 30, 2022, 1.8% for the quarter ended December 31, 2022, and 1.0% for the quarter ended March 31, 2023. The unemployment rate in the Eurozone declined to 6.6% in March 2023, from 6.8% in March 2022.
For more information on our credit and borrower ratings, see “Item 11. Quantitative and Qualitative Disclosures about Credit, Market and Other Risk—Credit Risk Management.” The accrual status is a primary credit quality indicator for loans within the Residential segment, the Card segment and the Other segment as well as consumer loans within the MUFG Americas Holdings segment.
For more information on our credit and borrower ratings, see “Item 11. Quantitative and Qualitative Disclosures about Credit, Market and Other Risk—Credit Risk Management.” The accrual status is a primary credit quality indicator for loans within the Residential segment, the Card segment and the Other segment.
Capital Ratios and Leverage Ratios of Major Banking Subsidiaries in Japan The figures underlying the rations in the table below are calculated in accordance with Japanese banking regulations based on information derived from each bank’s consolidated and non-consolidated financial statements prepared in accordance with Japanese GAAP, as required by the FSA.
Information on the Company—Business Overview—Supervision and Regulation—Japan—Capital adequacy.” Capital Ratios and Leverage Ratios of Major Banking Subsidiaries in Japan The figures underlying the rations in the table below are calculated in accordance with Japanese banking regulations based on information derived from each bank’s consolidated and non-consolidated financial statements prepared in accordance with Japanese GAAP, as required by the FSA.
As of March 31, 2022, our external TLAC ratios were 18.23% on a risk-weighted assets basis and 9.23% on a leverage exposure basis. We are required to maintain external TLAC ratios of 18% on a risk-weighted assets basis and 6.75% on a leverage exposure basis as of the same date. See “—B.
As of March 31, 2023, our external TLAC ratios were 20.22% on a risk-weighted assets basis and 9.47% on a leverage exposure basis. We are required to maintain external TLAC ratios of 18% on a risk-weighted assets basis and 6.75% on a leverage exposure basis as of the same date. See “—B.
(3) The TLAC ratio on a risk-weighted assets basis and the required minimum ratios as of March 31, 2021 do not include the regulatory capital buffers consisting of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a nil countercyclical buffer.
The TLAC ratio on a risk-weighted assets basis and the required minimum ratios as of March 31, 2023 do not include the regulatory capital buffers consisting of a capital conservation buffer of 2.5%, a G-SIB surcharge of 1.5% and a countercyclical buffer of 0.04%.
Japanese Corporate & Investment Banking Business Group —Covers the large Japanese corporate businesses. This business group offers large Japanese corporations advanced financial solutions designed to respond to their diversified and globalized needs and to contribute to their business and financial strategies through the global network of our group companies.
This business group offers large Japanese corporations advanced financial solutions designed to respond to their diversified and globalized needs and to contribute to their business and financial strategies through the global network of our group companies.
For information on the issuances of Additional Tier 1 and Tier 2 securities, see also “Recent Developments—Issuances of Basel III-Compliant Domestic Subordinated Bonds.” Leverage Requirements for Banking Institutions in Japan Our consolidated leverage ratio is calculated in accordance with the methodology prescribed in the FSA guidance that has been adopted to implement the relevant Basel III standard.
Information on the Company—Business Overview—Supervision and Regulation—Japan—Capital adequacy.” For information on the issuances of Additional Tier 1 and Tier 2 securities, see also “Recent Developments—Issuances of Basel III-Compliant Domestic Subordinated Debt.” Leverage Requirements for Banking Institutions in Japan Our consolidated leverage ratio is calculated in accordance with the methodology prescribed in the FSA guidance that has been adopted to implement the relevant Basel III standard.
External TLAC ratios are expressed as the ratio of external TLAC amount to risk-weighted assets or leverage exposure in accordance with the FSA guidance. We are required to maintain external TLAC ratios of 18% on a risk-weighted assets basis and 6.75% on a leverage exposure basis. See “Item 4.B.
External TLAC ratios are expressed as the ratio of external TLAC amount to risk-weighted assets or a total exposure in accordance with the FSA guidance. We are required to maintain external TLAC ratios of 18% on a risk-weighted assets basis and 6.75% on a total exposure basis.
Equity securities decreased 12.9% mainly because marketable equity securities decreased due to sales of equity securities held in our strategic equity investment portfolio. Marketable equity securities largely consist of listed equity securities in Japan.
Equity securities decreased 7.8% mainly because marketable equity securities decreased due to sales of equity securities held in our strategic equity investment portfolio. Marketable equity securities largely consist of listed equity securities in Japan.
These changes had the following impact on our previously reported business segment information for the fiscal years ended March 31, 2020 and 2021: • increasing the operating profits of the Global Corporate & Investment Banking Business Group, Other, and the Global Commercial Banking Business Group by ¥9.0 billion, ¥4.2 billion and ¥0.2 billion, respectively, for the fiscal year ended March 31, 2020, • reducing the operating profits of the Retail & Commercial Banking Business Group, the Japanese Corporate & Investment Banking Business Group, the Global Markets Business Group and the Asset Management & Investor Services Business Group by ¥217.0 billion, ¥3.5 billion, ¥2.9 billion and ¥2.1billion, respectively, for the fiscal year ended March 31, 2020, • increasing the operating profits of Other, the Global Corporate & Investment Banking Business Group, and the Global Commercial Banking Business Group by ¥15.6 billion, ¥5.1 billion and ¥2.0 billion, respectively, for the fiscal year ended March 31, 2021, and • reducing the operating profits of the Retail & Commercial Banking Business Group, the Asset Management & Investor Services Business Group, the Global Markets Business Group and the Japanese Corporate & Investment Banking Business Group by ¥191.8 billion, ¥2.8 billion, ¥0.7 billion and ¥0.5billion, respectively, for the fiscal year ended March 31, 2021.
These changes had the following impact on our previously reported business segment information for the fiscal years ended March 31, 2021 and 2022: • increasing the operating profits of the Digital Service Business Group, the Japanese Corporate & Investment Banking Business Group, the Global Corporate & Investment Banking Business Group and the Global Commercial Banking Business Group by ¥8.2 billion, ¥5.7 billion, ¥4.9 billion and ¥0.8 billion, respectively, for the fiscal year ended March 31, 2021, • reducing the operating profits of the Retail & Commercial Banking Business Group, Other, the Global Markets Business Group and the Asset Management & Investor Services Business Group by ¥9.1 billion, ¥7.4 billion, ¥2.9 billion and ¥0.2 billion, respectively, for the fiscal year ended March 31, 2021, • increasing the operating profits of the Digital Service Business Group, the Global Corporate & Investment Banking Business Group, the Japanese Corporate & Investment Banking Business Group and the Global Commercial Banking Business Group by ¥10.3 billion, ¥6.5 billion, ¥0.9 billion and ¥0.3 billion, respectively, for the fiscal year ended March 31, 2022, and • reducing the operating profits of the Retail & Commercial Banking Business Group, Other, the Global Markets Business Group and the Asset Management & Investor Services Business Group by ¥11.0 billion, ¥3.9 billion, ¥3.0 billion and ¥0.1 billion, respectively, for the fiscal year ended March 31, 2022.
The average exchange rate for the conversion of the US dollar financial statements of some of our foreign subsidiaries for the fiscal year ended December 31, 2021 was ¥109.80 per US$1.00, compared to the average exchange rate for the fiscal year ended December 31, 2020 of ¥106.82 per US$1.00.
The average exchange rate for the conversion of the US dollar financial statements of some of our foreign subsidiaries for the fiscal year ended December 31, 2022 was ¥131.43 per US$1.00, compared to the average exchange rate for the fiscal year ended December 31, 2021 of ¥109.80 per US$1.00.
Fixed assets of MUFG, other consolidated subsidiaries and Japanese GAAP consolidation adjustments amounting to ¥1,286.1 billion are not allocated to each business segment when determining the allocation of management resources and assessing performance, therefore such amounts are not included in the table above.
Fixed assets of MUFG and other consolidated subsidiaries and Japanese GAAP consolidation adjustments amounting to ¥1,286.1 billion as of March 31, 2022 and ¥1,210.2 billion as of March 31, 2023, respectively, are not allocated to each business segment when determining the allocation of management resources and assessing performance and, therefore, such amounts are not included in the table above.
On a year-on-year basis, U.S. real GDP grew by 12.2% for the quarter ended June 30, 2021, 4.9% for the quarter ended September 30, 2021, 5.5% for the quarter ended December 31, 2021 and 3.6% for the quarter ended March 31, 2022. The unemployment rate declined to 3.6% in March 2022, from 6.0% in March 2021.
On a year-on-year basis, U.S. real GDP grew by 1.8% for the quarter ended June 30, 2022, 1.9% for the quarter ended September 30, 2022, 0.9% for the quarter ended December 31, 2022 and 1.8% for the quarter ended March 31, 2023. The unemployment rate declined to 3.5% in March 2023, from 3.6% in March 2022.
Operating Results 57 Results of Operations 57 Business Segment Analysis 65 Geographic Segment Analysis 70 Effect of Change in Exchange Rates on Foreign Currency Translation 71 B. Liquidity and Capital Resources 71 Financial Condition 71 Capital Adequacy 81 Non-exchange Traded Contracts Accounted for at Fair Value 87 C. Research and Development, Patents and Licenses, etc. 87 D.
Operating Results 58 Results of Operations 58 Business Segment Analysis 67 Geographic Segment Analysis 71 Effect of Change in Exchange Rates on Foreign Currency Translation 72 B. Liquidity and Capital Resources 72 Financial Condition 72 Capital Adequacy 83 Non-exchange Traded Contracts Accounted for at Fair Value 86 C. Research and Development, Patents and Licenses, etc. 87 D.
These economic forecast scenarios include macroeconomic variables that have historically been correlated with historical credit losses. These variables include, but are not limited to, unemployment rates and gross domestic product. As any one economic forecast scenario is inherently uncertain, multiple economic forecast scenarios were leveraged.
The allowance for credit losses is estimated using quantitative models that incorporate economic forecast scenarios. These economic forecast scenarios include macroeconomic variables that have historically been correlated with historical credit losses. These variables include, but are not limited to, unemployment rates and gross domestic product. As any one economic forecast scenario is inherently uncertain, multiple economic forecast scenarios were leveraged.
Key Information—Risk Factors—Risks Related to Our Ability to Meet Regulatory Capital Requirements—We may not be able to maintain our capital ratios and other regulatory ratios above minimum required levels, which could result in various regulatory actions, including the suspension of some or all of our operations.” 81 T a b l e o f C o n t e n t s We continually monitor our risk-adjusted capital ratios, leverage ratio and TLAC ratios closely, and manage our operations in consideration of the capital requirements.
Key Information—Risk Factors—Risks Related to Our Ability to Meet Regulatory Capital Requirements—We may not be able to maintain our capital ratios and other regulatory ratios above minimum required levels, which could result in various regulatory actions, including the suspension of some or all of our operations.” We continually monitor our risk-adjusted capital ratios, leverage ratio and TLAC ratios closely, and manage our operations in consideration of the capital requirements.
For the Residential and Card segments, the loans are smaller-balance homogeneous loans that are pooled by the risk ratings based on the number of delinquencies. 76 T a b l e o f C o n t e n t s For more information on our methodologies used to estimate the allowance for each portfolio segment, see “Summary of Significant Accounting Policies” in Note 1 to our consolidated financial statements and “—E.
For the Residential and Card segments, the loans are smaller-balance homogeneous loans that are pooled by the risk ratings based on the number of delinquencies. For more information on our methodologies used to estimate the allowance for each portfolio segment, see “Summary of Significant Accounting Policies” in Note 1 to our consolidated financial statements and “—E.
The U.S. economy generally underwent upward trends during the fiscal year ended March 31, 2022, with U.S. real GDP growing by 6.7% for the quarter ended June 30, 2021, 2.3% for the quarter ended September 30, 2021, and 6.9% for the quarter ended December 31, 2021, and contracting 1.4% for the quarter ended March 31, 2022, on a quarter-on-quarter annualized basis.
The U.S. economy generally underwent upward trends during the fiscal year ended March 31, 2023, with U.S. real GDP contracting by 0.6% for the quarter ended June 30, 2022, but growing by 3.2% for the quarter ended September 30, 2022, 2.6% for the quarter ended December 31, 2022, and 2.0% for the quarter ended March 31, 2023, on a quarter-on-quarter annualized basis.
Net gains (losses) from marketable equity securities include net gains (losses) on sales of marketable equity securities as well as unrealized gains (losses) on such securities. Net investment securities losses were ¥119.0 billion for the fiscal year ended March 31, 2022, compared to net gains of ¥1,458.3 billion for the fiscal year ended March 31, 2021.
Net gains (losses) from marketable equity securities include net gains (losses) on sales of marketable equity securities as well as unrealized gains (losses) on such securities. Net investment securities losses for the fiscal year ended March 31, 2023 were ¥254.2 billion, compared to net losses of ¥119.0 billion for the fiscal year ended March 31, 2022.
These notes are subject to our discretion to cease interest payments and a write-down of the principal upon the occurrence of certain events, including when our Common Equity Tier 1 capital ratio declines below 5.125%, when 55 T a b l e o f C o n t e n t s we are deemed to be at risk of becoming non-viable or when we become subject to bankruptcy proceedings, but, following any write-down, the principal may be reinstated to the extent permitted by the Japanese banking regulator.
These securities and borrowings are subject to our discretion to cease interest payments and a write-down of the principal upon the occurrence of certain events, including when our Common Equity Tier 1 capital ratio declines below 5.125%, when we are deemed to be at risk of becoming non-viable or when we become subject to bankruptcy proceedings, but, following any write-down, the principal may be reinstated to the extent permitted by the Japanese banking regulator.
Krungsri segment —We recorded ¥90.5 billion of provision for credit losses for the fiscal year ended March 31, 2022, compared to ¥90.1 billion of provision for credit losses for the previous fiscal year.
Krungsri segment —We recorded ¥70.7 billion of provision for credit losses for the fiscal year ended March 31, 2023, compared to ¥90.5 billion of provision for credit losses for the previous fiscal year.
The Japanese economy remains subject to the impact of the COVID-19 pandemic, instabilities resulting from the geopolitical developments in Ukraine, increasing public debt, intensifying trade conflicts and global competition, declining domestic population, inflation concerns, downward pressure on private consumption, and various other factors that could adversely affect economic conditions in Japan.
The Japanese economy remains subject to instabilities resulting from geopolitical developments, increasing public debt, intensifying trade conflicts and global competition, declining domestic population, inflationary trends, downward pressure on private consumption, and various other factors that could adversely affect economic conditions in Japan.
Japan’s real gross domestic product, or GDP, grew by 0.5% for the quarter ended June 30, 2021, contracted by 0.7% for the quarter ended September 30, 2021, grew by 0.9% for the quarter ended December 31, 2021, and contracted by 0.2% for the quarter ended March 31, 2022 on a quarter-on-quarter basis.
Japan’s real gross domestic product, or GDP, grew by 1.4% for the quarter ended June 30, 2022, contracted by 0.4% for the quarter ended September 30, 2022, grew by 0.1% for the quarter ended December 31, 2022, and grew by 0.7% for the quarter ended March 31, 2023 on a quarter-on-quarter basis.
As of March 31, 2021, Mitsubishi UFJ Morgan Stanley Securities’ capital accounts less certain fixed assets of ￥475.3billion represented 275.4% of the total amounts equivalent to market, counterparty credit and operational risks. These figures are calculated in accordance with Japanese GAAP, pursuant to the Financial Instruments and Exchange Act of Japan.
As of March 31, 2022, Mitsubishi UFJ Morgan Stanley Securities’ capital accounts less certain fixed assets of ¥486.8 billion represented 317.1% of the total amounts equivalent to market, counterparty credit and operational risks. These figures are calculated in accordance with Japanese GAAP, pursuant to the Financial Instruments and Exchange Act of Japan.
The ratio of loans classified as Close Watch to total loans in the segment decreased to 2.65% as of March 31, 2022 from 3.02% as of March 31, 2021.
The ratio of loans classified as Close Watch to total loans in the segment decreased to 2.35% as of March 31, 2023 from 2.65% as of March 31, 2022.
Treasury bonds as the Japanese yen depreciated against the U.S. dollar from ¥110.71 to the U.S. dollar as of March 31, 2021 to ¥122.39 to the U.S. dollar as of March 31, 2022, which represented a larger exchange rate fluctuation compared to the previous fiscal year when the Japanese yen depreciated against the U.S. dollar from ¥108.83 to the U.S. dollar as of March 31, 2020 to ¥110.71 to the U.S. dollar as of March 31, 2021.
Treasury bonds as the Japanese yen depreciated against the U.S. dollar from ¥122.39 to the U.S. dollar as of March 31, 2022 to ¥133.53 to the U.S. dollar as of March 31, 2023, which represented a slightly smaller exchange rate fluctuation compared to the previous fiscal year when the Japanese yen depreciated against the U.S. dollar from ¥110.71 to the U.S. dollar as of March 31, 2021 to ¥122.39 to the U.S. dollar as of March 31, 2022.
The ratio of loans classified as Likely to become Bankrupt or Legally/Virtually Bankrupt to total loans in the segment increased to 0.72% as of March 31, 2022 from 0.58% as of March 31, 2021.
The ratio of loans classified as Likely to become Bankrupt or Legally/Virtually Bankrupt to total loans in the segment decreased to 0.56% as of March 31, 2023 from 0.72% as of March 31, 2022.
The ratio of total allowance for credit losses to the total loan balance in this segment increased to 1.05% as of March 31, 2022 from 0.85% as of March 31, 2021.
The ratio of total allowance for credit losses to the total loan balance in this segment decreased to 0.74% as of March 31, 2023 from 1.05% as of March 31, 2022.
The Eurozone economy also grew modestly during the fiscal year ended March 31, 2022, with Eurozone real GDP growing by 2.2% for the quarter ended June 30, 2021, 2.2% for the quarter ended September 30, 2021, 0.3% for the quarter ended December 31, 2021, and 0.3% for the quarter ended March 31, 2022, on a quarter-on-quarter basis.
The Eurozone economy also grew modestly during the fiscal year ended March 31, 2023, with Eurozone real GDP growing by 0.8% for the quarter ended June 30, 2022, and 0.4% for the quarter ended September 30, 2022, and contracting by 0.1% for the quarter ended December 31, 2022, and 0.1% for the quarter ended March 31, 2023, on a quarter-on-quarter basis.
Treasury bonds, which can be used for cash funding even in periods of stress. In addition, they regularly perform 80 T a b l e o f C o n t e n t s liquidity stress testing designed to evaluate the impact of systemic market stress conditions and institution-specific stress events, including credit rating downgrades, on their liquidity positions.
Treasury bonds, which can be used for cash funding even in periods of stress. In addition, they regularly perform liquidity stress testing designed to evaluate the impact of systemic market stress conditions and institution-specific stress events, including credit rating downgrades, on their liquidity positions.
In addition, consumer finance business revenue decreased due to the adverse impact of the prolonged COVID-19 pandemic. The decrease in operating expenses was primarily due to measures implemented to optimize our branch network. Retail & Commercial Banking Business Group —Covers the domestic retail and commercial banking businesses.
In addition, consumer finance business revenue decreased due to the adverse impact of the prolonged COVID-19 pandemic. The decrease in operating expenses was primarily due to measures implemented to optimize our branch network.
We have adopted for such instruments the same methodology as that which is used in determining the allowance for credit losses on loans. The allowance for credit losses on off-balance sheet credit instruments was ¥126.1 billion as of March 31, 2022, an increase of ¥42.5 billion from ¥83.6 billion as of March 31, 2021.
We have adopted for such instruments the same methodology as that which is used in determining the allowance for credit losses on loans. The allowance for credit losses on off-balance sheet credit instruments was ¥143.8 billion as of March 31, 2023, an increase of ¥17.7 billion from ¥126.1 billion as of March 31, 2022.
Japan’s Consumer Price Index, or CPI, fluctuated between negative 0.9% and positive 0.5% on a month-on-month basis and between negative 1.1% and positive 1.2% on a year-over-year basis during the fiscal year ended March 31, 2022. The unemployment rate in Japan remained low while slightly increasing to 2.9% in June 2021and subsequently decreasing to 2.6% in March 2022.
Japan’s Consumer Price Index, or CPI, fluctuated between negative 0.6% and positive 0.4% on a month-on-month basis and between positive 1.2% and positive 4.3% on a year-over-year basis during the fiscal year ended March 31, 2023. The unemployment rate in Japan remained low while slightly increasing from 2.6% in March 2022 to 2.8% in March 2023.
The accrual status of these loans is determined based on the number of delinquent payments. Commercial loans within the MUFG Americas Holdings segment are categorized as either pass or criticized based on the internal credit rating assigned to each borrower. Criticized credits are those that are internally risk graded as Special Mention, Substandard or Doubtful.
Commercial loans within the MUFG Americas Holdings segment were categorized as either pass or criticized based on the internal credit rating assigned to each borrower. Criticized credits are those that are internally risk graded as Special Mention, Substandard or Doubtful.
Business Segment Analysis We measure the performance of each of our business segments primarily in terms of “operating profit.” Operating profit and other segment information in this Annual Report are based on the financial information prepared in accordance with Japanese GAAP as adjusted in accordance with internal management accounting rules and practices.
This mainly reflected a decrease in net income of certain consolidated VIEs. 66 Table of Contents Business Segment Analysis We measure the performance of each of our business segments primarily in terms of “operating profit.” Operating profit and other segment information in this Annual Report are based on the financial information prepared in accordance with Japanese GAAP as adjusted in accordance with internal management accounting rules and practices.
(2) Fixed assets in the above table are based on the financial information prepared in accordance with Japanese GAAP as adjusted in accordance with internal management accounting rules and practices, and it corresponds to the U.S.
(2) Fixed assets in the above table are based on the financial information prepared in accordance with Japanese GAAP as adjusted in accordance with internal management accounting rules and practices, and it corresponds to the U.S. GAAP amounts of premises and equipment-net, intangible assets-net and goodwill of BK and TB.
Receivables under Securities Borrowing Transactions Receivables under securities borrowing transactions increased ¥1,126.5 billion to ¥4,496.4 billion as of March 31, 2022 from ¥3,369.9 billion as of March 31, 2021. This increase was mainly due to an increase in collateral deposited for funding in our domestic banking and securities subsidiaries.
Receivables under Securities Borrowing Transactions Receivables under securities borrowing transactions increased ¥59.3 billion to ¥4,555.7 billion as of March 31, 2023 from ¥4,496.4 billion as of March 31, 2022. This increase was mainly due to an increase in collateral deposited for funding in our domestic banking and securities subsidiaries.
While we have not entered into any consumer loan agreement after April 2007 that imposes an interest rate exceeding the limits stipulated by the Interest Rate Restriction Act, we need to estimate the number of possible claims for reimbursement of excess interest 88 T a b l e o f C o n t e n t s payments.
While we have not entered into any consumer loan agreement after April 2007 that imposes an interest rate exceeding the limits stipulated by the Interest Rate Restriction Act, we need to estimate the number of possible claims for reimbursement of excess interest payments.

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Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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June 2019 Member of the Board of Directors (Outside Director) of MUFG (incumbent) March 2021 Non-executive Director of Kirin Holdings Company, Limited (incumbent) June 2022 Senior Advisor of NTT DOCOMO, INC.
June 2019 Member of the Board of Directors (Outside Director) of MUFG (incumbent) March 2021 Non-executive Director of Kirin Holdings Company, Limited June 2022 Senior Advisor of NTT DOCOMO, INC.
(incumbent) Satoko Kuwabara (November 1, 1964) Member of the Board of Directors (Outside Director) April 1990 Registered as an attorney at law, Member of the Daini Tokyo Bar Association Joined Mori Sogo (currently Mori Hamada & Matsumoto) January 1998 Partner of Mori Hamada & Matsumoto June 2016 Outside Director of BANDAI NAMCO Holdings Inc.
Satoko Kuwabara (November 1, 1964) Member of the Board of Directors (Outside Director) April 1990 Registered as an attorney at law, Member of the Daini Tokyo Bar Association Joined Mori Sogo (currently Mori Hamada & Matsumoto) January 1998 Partner of Mori Hamada & Matsumoto June 2016 Outside Director of BANDAI NAMCO Holdings Inc.
The chairman of the committee is Hirofumi Nomoto, an independent outside director. The other members of this committee are Mariko Fujii, Kaoru Kato and Satoko Kuwabara, who are independent outside directors, and Hironori Kamezawa, Director, President & Group CEO. Between April 2021 and March 2022, the nominating and governance committee met 11 times.
The chairman of the committee is Hirofumi Nomoto, an independent outside director. The other members of this committee are Mariko Fujii, Kaoru Kato and Satoko Kuwabara, who are independent outside directors, and Hironori Kamezawa, Director, President & Group CEO. Between April 2022 and March 2023, the nominating and governance committee met 11 times.
Directors and Senior Management Members of the Board of Directors The following table sets forth the members of our board of directors as of June 29, 2022, together with their respective dates of birth, positions and experience: Name (Date of Birth) Position in MUFG Business Experience Mariko Fujii (March 9, 1955) Member of the Board of Directors (Outside Director) April 1977 Joined Ministry of Finance of Japan July 1997 Director, International Affairs and Research Division, Customs and Tariff Bureau, Ministry of Finance April 1999 Associate Professor, Research Center for Advanced Science and Technology, The University of Tokyo March 2001 Professor, Research Center for Advanced Economic Engineering, The University of Tokyo April 2004 Professor, Research Center for Advanced Science and Technology, National University Corporation, The University of Tokyo June 2014 Outside Director of Electric Power Development Co., Ltd.
Directors and Senior Management Members of the Board of Directors The following table sets forth the members of our board of directors as of July 1, 2023, together with their respective dates of birth, positions and experience: Name (Date of Birth) Position in MUFG Business Experience Mariko Fujii (March 9, 1955) Member of the Board of Directors (Outside Director) April 1977 Joined Ministry of Finance of Japan July 1997 Director, International Affairs and Research Division, Customs and Tariff Bureau, Ministry of Finance April 1999 Associate Professor, Research Center for Advanced Science and Technology, The University of Tokyo March 2001 Professor, Research Center for Advanced Economic Engineering, The University of Tokyo April 2004 Professor, Research Center for Advanced Science and Technology, National University Corporation, The University of Tokyo June 2014 Outside Director of Electric Power Development Co., Ltd.
Corporate Executives Our corporate executives are responsible for executing and managing our business operations within the scope of the authority delegated to them by the board of directors. Under the Companies Act, at least one corporate executive must be appointed by a resolution of the board of directors. We currently have 18 corporate executives.
Corporate Executives Our corporate executives are responsible for executing and managing our business operations within the scope of the authority delegated to them by the board of directors. Under the Companies Act, at least one corporate executive must be appointed by a resolution of the board of directors. We currently have 17 corporate executives.
The compensation paid by MUFG and its subsidiaries during the fiscal year ended March 31, 2022 to our directors and corporate executives consisted of annual base salaries, performance-based stock compensation, cash bonuses and other benefits. MUFG’s compensation committee determines the compensation paid to our directors and corporate executives.
Compensation The compensation paid by MUFG and its subsidiaries during the fiscal year ended March 31, 2023 to our directors and corporate executives consisted of annual base salaries, performance-based stock compensation, cash bonuses and other benefits. MUFG’s compensation committee determines the compensation paid to our directors and corporate executives.
Under the Companies Act, the audit committee must consist of at least three non-executive directors, and the majority of its members must be outside directors. Our committee currently has six members. The chairman of the committee is Koichi Tsuji, an independent outside director.
Under the Companies Act, the audit committee must consist of at least three non-executive directors, and the majority of its members must be outside directors. Our committee currently has five members. The chairman of the committee is Koichi Tsuji, an independent outside director.
An “outside director” is defined by the Companies Act as a person who meets all of the following conditions: • the person is not currently, and has not been in the ten years prior to his or her assumption of office as outside director, an executive director, who is a director concurrently performing an executive role ( gyomu shikko torishimariyaku ), a corporate executive, a manager ( shihainin ), or any other type of employee of the company or any of its subsidiaries; • if the person has been a non-executive director, a corporate auditor, or an accounting adviser ( kaikei sanyo ) of the company or any of its subsidiaries within the ten years prior to his or her assumption of office as outside director, the person was not an executive director, a corporate executive, a manager or any other type of employee of the company or any of its subsidiary in the ten years prior to his or her assumption of office as such; • the person is not a director, a corporate executive, a manager or any other type of employee of the company’s parent company, or a person who controls the company; • the person is not an executive director, a corporate executive, a manager or any other type of employee of another subsidiary of the company’s parent company; and • the person is not the spouse or a family member within the second degree of kinship of a director, a corporate executive, a manager, or any other type of important employee of the company or a person who controls the company.
An “outside director” is defined by the Companies Act as a person who meets all of the following conditions: • the person is not currently, and has not been in the ten years prior to his or her assumption of office as outside director, an executive director, who is a director concurrently performing an executive role ( gyomu shikko torishimariyaku ), a corporate executive, a manager ( shihainin ), or any other type of employee of the company or any of its subsidiaries; 105 Table of Contents • if the person has been a non-executive director, a corporate auditor, or an accounting adviser ( kaikei sanyo ) of the company or any of its subsidiaries within the ten years prior to his or her assumption of office as outside director, the person was not an executive director, who is a director concurrently performing an executive role, a corporate executive, a manager or any other type of employee of the company or any of its subsidiary in the ten years prior to his or her assumption of office as such; • the person is not a director, a corporate executive, a manager or any other type of employee of the company’s parent company, or a natural person who controls the company; • the person is not an executive director, who is a director concurrently performing an executive role, a corporate executive, a manager or any other type of employee of another subsidiary of the company’s parent company or another company controlled by a natural person who controls the company; and • the person is not the spouse or a family member within the second degree of kinship of a director, a corporate executive, a manager, or any other type of important employee of the company, or a natural person who controls the company.
Ambassador Extraordinary and Plenipotentiary of Japan to the Republic of Latvia June 2016 Emeritus Professor of The University of Tokyo (incumbent) January 2019 Retired from Ambassador of Japan to the Republic of Latvia June 2019 Outside Director of NTT DATA CORPORATION (incumbent) Member of the Board of Directors (Outside Director) of MUFG (incumbent) Keiko Honda (September 27, 1961) Member of the Board of Directors (Outside Director) April 1984 Joined Bain & Company Japan, Incorporated May 1986 Joined Shearson Lehman Brothers Securities Co., Ltd.
October 2015 Ambassador Extraordinary and Plenipotentiary of Japan to the Republic of Latvia June 2016 Emeritus Professor of The University of Tokyo (incumbent) January 2019 Retired from Ambassador of Japan to the Republic of Latvia June 2019 Outside Director of NTT DATA CORPORATION (currently NTT DATA GROUP CORPORATION) (incumbent) Member of the Board of Directors (Outside Director) of MUFG (incumbent) Keiko Honda (September 27, 1961) Member of the Board of Directors (Outside Director) April 1984 Joined Bain & Company Japan, Incorporated May 1986 Joined Shearson Lehman Brothers Securities Co., Ltd.
Nominating Committee Our nominating committee, which we call the nominating and governance committee, determines the contents of proposals regarding the election and removal of director candidates to be submitted to general meetings of shareholders.
Nominating Committee 106 Table of Contents Our nominating committee, which we call the nominating and governance committee, determines the contents of proposals regarding the election and removal of director candidates to be submitted to general meetings of shareholders.
April 2022 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Shuichi Yokoyama (December 17, 1965) Managing Corporate Executive (Group Chief Risk Officer or Group CRO) April 1990 Joined The Bank of Tokyo, Ltd.
April 2021 Managing Executive Officer of BK April 2022 Managing Corporate Executive of MUFG June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) April 2023 Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) Shuichi Yokoyama (December 17, 1965) Managing Corporate Executive (Group Chief Risk Officer, or Group CRO) April 1990 Joined The Bank of Tokyo, Ltd.
The chairman of the committee is Satoko Kuwabara, an independent outside director. The other members of this committee are Mariko Fujii, Kaoru Kato and Hirofumi Nomoto, who are independent outside directors, and Hironori Kamezawa, Director, President & Group CEO. Between April 2021 and March 2022, the compensation committee met 8 times.
The chairman of the committee is Satoko Kuwabara, an independent outside director. The other members of this committee are Mariko Fujii, Kaoru Kato and Hirofumi Nomoto, who are independent outside directors, and Hironori Kamezawa, Director, President & Group CEO. Between April 2022 and March 2023, the compensation committee met 7 times.
June 2016 Executive Officer of BK Executive Officer of MUFG April 2020 Managing Executive Officer of BK April 2022 Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Notes: The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd. or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.
June 2018 Executive Officer of BK Executive Officer of MUFG April 2022 Managing Executive Officer of BK Managing Executive Officer of MUFG June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) April 2023 Managing Corporate Executive of MUFG (incumbent) Notes: The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd. or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.
Board of Directors Our board of directors consists of directors who are elected at a general meeting of shareholders. Under our articles of incorporation, the number of directors may not exceed 20. We currently have 16 directors, nine of whom are independent outside directors and two of whom are internal non-executive directors.
Board of Directors Our board of directors consists of directors who are elected at a general meeting of shareholders. Under our articles of incorporation, the number of directors may not exceed 20. We currently have 15 directors, eight of whom are independent outside directors and two of whom are internal non-executive directors.
(or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.) “TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd. “MUMSS” refers to Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
(or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.) “TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.” Cash Bonuses We from time to time pay cash bonuses to our directors and corporate executives to further motivate them to contribute to the improvement of our stock prices and profits if such bonuses are deemed appropriate based on a balanced scorecard approach taking 104 T a b l e o f C o n t e n t s into account the results of operations of the MUFG Group and each director’s or corporate executive’s individual performance of his or her duties as a director or corporate executive in light of both quantitative and qualitative criteria, including our medium-term strategy for improving our corporate value.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.” 103 Table of Contents Cash Bonuses We from time to time pay cash bonuses to our directors and corporate executives to further motivate them to contribute to the improvement of our stock prices and profits if such bonuses are deemed appropriate based on a balanced scorecard approach taking into account the results of operations of the MUFG Group and each director’s or corporate executive’s individual performance of his or her duties as a director or corporate executive in light of both quantitative and qualitative criteria, including our medium-term strategy for improving our corporate value.
Between April 2021 and March 2022, the risk committee met six times. U.S. Risk Committee The U.S. risk committee oversees the risk management function for our combined U.S. operations. Its oversight role includes, but is not limited to, all roles and responsibilities required under the FRB’s final rules for Enhanced Prudential Standards for foreign banking organizations.
Between April 2022 and March 2023, the risk committee met four times. 107 Table of Contents U.S. Risk Committee The U.S. risk committee oversees the risk management function for our combined U.S. operations. Its oversight role includes, but is not limited to, all roles and responsibilities required under the FRB’s final rules for Enhanced Prudential Standards for foreign banking organizations.
April 2020 Member of the Board of Directors of BK (incumbent) Member of the Board of Directors, President & Group CEO of MUFG (incumbent) May 2021 Director of Morgan Stanley (incumbent) Iwao Nagashima (March 15, 1963) Member of the Board of Directors April 1985 Joined The Mitsubishi Trust and Banking Corporation June 2011 Executive Officer of TB June 2013 Managing Executive Officer of TB Executive Officer of MUFG June 2015 Director and Managing Executive Officer of TB Managing Executive Officer of TB June 2016 Director and Senior Managing Executive Officer of TB April 2019 Director, Deputy President, and Executive Officer of TB Senior Managing Corporate Executive of MUFG President & CEO of MU Trust Apple Planning Company, Ltd.
April 2020 Member of the Board of Directors of BK (incumbent) Member of the Board of Directors, President & Group CEO of MUFG (incumbent) May 2021 Director of Morgan Stanley (incumbent) 95 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Iwao Nagashima (March 15, 1963) Member of the Board of Directors April 1985 Joined The Mitsubishi Trust and Banking Corporation June 2011 Executive Officer of TB June 2013 Managing Executive Officer of TB Executive Officer of MUFG June 2015 Director and Managing Executive Officer of TB Managing Executive Officer of MUFG June 2016 Director and Senior Managing Executive Officer of TB April 2019 Director, Deputy President, and Executive Officer of TB Senior Managing Corporate Executive of MUFG President & CEO of MU Trust Apple Planning Company, Ltd.
April 2020 President and CEO of TB (incumbent) Deputy Chairman of MUFG June 2020 Member of the Board of Directors, Deputy Chairman of MUFG 96 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience April 2022 Member of the Board of Directors of MUFG (incumbent) Junichi Hanzawa (January 19, 1965) Member of the Board of Directors April 1988 Joined The Mitsubishi Bank, Limited June 2014 Executive Officer of BK Executive Officer of MUFG May 2018 Managing Executive Officer of BK April 2019 Managing Corporate Executive of MUFG June 2019 Member of the Board of Directors, Managing Executive Officer of BK April 2021 President & CEO of BK (incumbent) Deputy Chairman of MUFG June 2021 Member of the Board of Directors, Deputy Chairman of MUFG April 2022 Member of the Board of Directors of MUFG (incumbent) Makoto Kobayashi (February 22, 1962) Member of the Board of Directors April 1985 Joined The Mitsubishi Bank, Limited June 2011 Executive Officer of BK May 2015 Managing Executive Officer of BK July 2015 Executive Officer of MUFG July 2018 Managing Executive Officer of SCHD Managing Executive Officer of MUFG October 2018 Managing Executive Officer of TB April 2020 Senior Managing Executive Officer of SCHD Deputy President of MUMSS June 2020 Member of the Board of Directors, Senior Managing Executive Officer of SCHD June 2021 Member of the Board of Directors, Deputy President of MUMSS April 2022 President & Global CEO of SCHD (incumbent) President & CEO of MUMSS (incumbent) June 2022 Member of the Board of Directors of MUFG (incumbent) Notes: The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd. or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.
April 2020 President and CEO of TB (incumbent) Deputy Chairman of MUFG June 2020 Member of the Board of Directors, Deputy Chairman of MUFG April 2022 Member of the Board of Directors of MUFG (incumbent) Junichi Hanzawa (January 19, 1965) Member of the Board of Directors April 1988 Joined The Mitsubishi Bank, Limited June 2014 Executive Officer of BK Executive Officer of MUFG May 2018 Managing Executive Officer of BK April 2019 Managing Corporate Executive of MUFG June 2019 Member of the Board of Directors, Managing Executive Officer of BK April 2021 President & CEO of BK (incumbent) Deputy Chairman of MUFG June 2021 Member of the Board of Directors, Deputy Chairman of MUFG April 2022 Member of the Board of Directors of MUFG (incumbent) Makoto Kobayashi (February 22, 1962) Member of the Board of Directors April 1985 Joined The Mitsubishi Bank, Limited June 2011 Executive Officer of BK May 2015 Managing Executive Officer of BK July 2015 Executive Officer of MUFG July 2018 Managing Executive Officer of SCHD Managing Executive Officer of MUFG October 2018 Managing Executive Officer of TB April 2020 Senior Managing Executive Officer of SCHD Deputy President of MUMSS June 2020 Member of the Board of Directors, Senior Managing Executive Officer of SCHD June 2021 Member of the Board of Directors, Deputy President of MUMSS April 2022 President & Global CEO of SCHD (incumbent) President & CEO of MUMSS (incumbent) June 2022 Member of the Board of Directors of MUFG (incumbent) 96 Table of Contents Notes: The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd. or its former name The Bank of Tokyo-Mitsubishi UFJ, Ltd.
(incumbent) June 2022 Outside Director of Olympus Corporation (incumbent) Koichi Tsuji (April 10, 1957) Member of the Board of Directors (Outside Director) October 1984 Joined Peat Marwick Mitchell & Company September 1988 Registered as Certified Public Accountant in Japan February 1989 Resident Representative, Zurich, Switzerland July 2004 Senior Partner of Ernst & Young ShinNihon LLC February 2016 Chairman and CEO of Ernst & Young ShinNihon LLC July 2019 Chairman & CEO of EY Japan Godo Kaisha Member of the Board of Directors of EY Japan Co., Ltd.
February 1992 Associate of Simpson Thacher & Bartlett LLP January 1994 Partner of Simpson Thacher & Bartlett LLP June 2022 Outside Director of PHC Holdings Corporation (incumbent) June 2023 Member of the Board of Directors (Outside Director) of MUFG (incumbent) Koichi Tsuji (April 10, 1957) Member of the Board of Directors (Outside Director) October 1984 Joined Peat Marwick Mitchell & Company September 1988 Registered as Certified Public Accountant in Japan February 1989 Resident Representative, Zurich, Switzerland July 2004 Senior Partner of Ernst & Young ShinNihon LLC February 2016 Chairman and CEO of Ernst & Young ShinNihon LLC July 2019 Chairman & CEO of EY Japan Godo Kaisha Member of the Board of Directors of EY Japan Co., Ltd.
(incumbent) June 2020 Member of the Board of Directors (Outside Director) of MUFG (incumbent) June 2022 Outside Director of the Board Recruit Holdings Co., Ltd.(incumbent) Kaoru Kato (May 20, 1951) Member of the Board of Directors (Outside Director) April 1977 Joined Nippon Telegraph and Telephone Public Corporation (NTT) July 1999 General Manager of Plant Department of NTT Kansai Mobile Communications Network, Inc.
(incumbent) June 2020 Member of the Board of Directors (Outside Director) of MUFG (incumbent) June 2022 Outside Director of the Board of Recruit Holdings Co., Ltd.(incumbent) 91 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Kaoru Kato (May 20, 1951) Member of the Board of Directors (Outside Director) April 1977 Joined Nippon Telegraph and Telephone Public Corporation (NTT) July 1999 General Manager of Plant Department of NTT Kansai Mobile Communications Network, Inc.
See “Members of the Board of Directors” under this Item 6.A. Hironori Kamezawa (November 18, 1961) See “Members of the Board of Directors” under this Item 6.A. See “Members of the Board of Directors” under this Item 6.A. Iwao Nagashima (March 15, 1963) See “Members of the Board of Directors” under this Item 6.A.
See “Members of the Board of Directors” under this Item 6.A. Hironori Kamezawa (November 18, 1961) See “Members of the Board of Directors” under this Item 6.A. See “Members of the Board of Directors” under this Item 6.A.
The following tables show the percentages of our employees across our different business units and in different locations as of March 31, 2022: Business unit MUFG Bank: Retail & Commercial Banking Business Unit 14 % Japanese Corporate & Investment Banking Business Unit 3 Global Corporate & Investment Banking Business Unit 2 Global Commercial Banking Business Unit 41 Global Markets Business Unit 1 Digital Service Business Unit 2 Corporate Center/Corporate Staff 17 Mitsubishi UFJ Trust and Banking: Trust-Banking 3 Trust Assets 4 Real Estate 2 Global Markets 0 Administration and subsidiaries 1 Mitsubishi UFJ Securities Holdings: Retail & Commercial Banking Business Unit 2 Japanese Corporate & Investment Banking Business Unit 0 Global Corporate & Investment Banking Business Unit 0 Global Markets Business Unit 1 Corporate Center/Corporate Staff 1 Mitsubishi UFJ NICOS: Business Marketing Division 1 Credit Risk Management & Risk Assets Administration Division 1 Operations Division 1 Systems & Systems Integration Division 0 Corporate Division 0 Others 0 Others 3 100 % 110 T a b l e o f C o n t e n t s Location MUFG Bank: Japan 24 % United States 10 Europe 2 Asia/Oceania excluding Japan 43 Other areas 0 Mitsubishi UFJ Trust and Banking: Japan 8 United States 1 Europe 1 Asia/Oceania excluding Japan 1 Mitsubishi UFJ Securities Holdings: Japan 5 United States 0 Europe 0 Asia/Oceania excluding Japan 0 Mitsubishi UFJ NICOS: Japan 3 United States 0 Europe 0 Asia/Oceania excluding Japan 0 Others 2 100 % Most of our employees are members of an employees’ union, which negotiates on behalf of employees in relation to remuneration and working conditions.
The following tables show the percentages of our employees across our different business units and in different locations as of March 31, 2023: 108 Table of Contents Business unit MUFG Bank: Retail & Commercial Banking Business Unit 13 % Japanese Corporate & Investment Banking Business Unit 3 Global Corporate & Investment Banking Business Unit 2 Global Commercial Banking Business Unit 40 Global Markets Business Unit 1 Digital Service Business Unit 2 Corporate Center/Corporate Staff 16 Mitsubishi UFJ Trust and Banking: Trust-Banking 3 Trust Assets 5 Real Estate 1 Global Markets 0 Administration and subsidiaries 2 Mitsubishi UFJ Securities Holdings: Retail & Commercial Banking Business Unit 2 Japanese Corporate & Investment Banking Business Unit 1 Global Corporate & Investment Banking Business Unit 0 Global Commercial Banking Business Unit 0 Trust Assets Business Unit 0 Global Markets Business Unit 1 Digital Service Business Unit 0 Corporate Center/Corporate Staff 2 Mitsubishi UFJ NICOS: Business Marketing Division 1 Credit Risk Management & Risk Assets Administration Division 1 Operations Division 1 Systems & Systems Integration Division 0 Corporate Division 0 Others 0 Others 3 100 % 109 Table of Contents Location MUFG Bank: Japan 25 % United States 4 Europe 2 Asia/Oceania excluding Japan 46 Other areas 1 Mitsubishi UFJ Trust and Banking: Japan 8 United States 1 Europe 1 Asia/Oceania excluding Japan 1 Mitsubishi UFJ Securities Holdings: Japan 5 United States 0 Europe 0 Asia/Oceania excluding Japan 0 Mitsubishi UFJ NICOS: Japan 3 United States 0 Europe 0 Asia/Oceania excluding Japan 0 Others 3 100 % Most of our employees are members of an employees’ union, which negotiates on behalf of employees in relation to remuneration and working conditions.
See “Members of the Board of Directors” under this Item 6.A. Yoshitaka Shiba (July 25, 1961) Senior Managing Corporate Executive (Group Chief Audit Officer, or Group CAO) Managing Director, Head of Internal Audit Division April 1986 Joined The Tokai Bank, Ltd.
Yoshitaka Shiba (July 25, 1961) Senior Managing Corporate Executive (Group Chief Audit Officer, or Group CAO) Managing Director, Head of Internal Audit Division April 1986 Joined The Tokai Bank, Ltd.
“MUAH” refers to MUFG Americas Holdings Corporation. 97 T a b l e o f C o n t e n t s Corporate Executives The following table sets forth our corporate executives as of July 1, 2022, together with their respective dates of birth, positions and experience: Name (Date of Birth) Position in MUFG Business Experience Kanetsugu Mike (November 4, 1956) See “Members of the Board of Directors” under this Item 6.A.
“MUAH” refers to MUFG Americas Holdings Corporation. 97 Table of Contents Corporate Executives The following table sets forth our corporate executives as of June 29, 2023, together with their respective dates of birth, positions and experience: Name (Date of Birth) Position in MUFG Business Experience Kanetsugu Mike (November 4, 1956) See “Members of the Board of Directors” under this Item 6.A.
The committee currently has eight members. The chairperson of the committee is Mariko Fujii, an independent outside director. The other members of this committee are Toby S. Myerson, Yasushi Shingai and Tarisa Watanagase, who are independent outside directors, Yutaka Miyashita, Managing Corporate Executive and Group CSO, and Shinichi Koide, Atsushi Miyanoya and Kazuhiko Ohashi, who are external experts.
The committee currently has eight members. The chairperson of the committee is Mariko Fujii, an independent outside director. The other members of this committee are David Sneider and Tarisa Watanagase, who are independent outside directors, Hideaki Takase, Managing Corporate Executive and Group CSO, and Shinichi Koide, Atsushi Miyanoya, Kazuhiko Ohashi and Takeo Hoshi, who are external experts.
The ADSs to be delivered to grantees will be purchased on the open market by the trustee of the independent trust pursuant to a trust agreement between MUFG Americas Holdings and the trustee. As of June 30, 2022, 140,889,406 RSUs have been granted under the plan, of which 28,570,739 RSUs were outstanding as of June 30, 2022.
The ADSs to be delivered to grantees will be purchased on the open market by the trustee of the independent trust pursuant to a trust agreement between MUFG Americas Holdings and the trustee. As of June 30, 2023, 148,089,572 RSUs have been granted under the plan, of which 15,614,429 RSUs were outstanding as of June 30, 2023.
The 107 T a b l e o f C o n t e n t s board of directors may delegate, to the extent permitted by the Companies Act, the authority to make decisions on the execution and management of our business operations. Our board of directors has delegated most of this authority to the corporate executives.
The board of directors may delegate, to the extent permitted by the Companies Act, the authority to make decisions on the execution and management of our business operations. Our board of directors has delegated most of this authority to the corporate executives.
“TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd. “MUMSS” refers to Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. “BK(US)” refers to MUFG Union Bank, N.A.
“TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd. “MUMSS” refers to Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.
April 2019 Managing Executive Officer of BK April 2021 Managing Executive Officer of MUFG June 2021 Member of the Board of Directors, Managing Executive Officer of BK January 2022 Managing Corporate Executive of MUFG April 2022 Member of the Board of Directors, Senior Managing Executive Officer of BK (incumbent) Senior Managing Corporate Executive of MUFG (incumbent) 99 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Hiroshi Mori (February 21, 1965) Managing Corporate Executive (Group Chief Legal Officer, or Group CLO) April 1989 Joined Development Bank of Japan (currently Development Bank of Japan, Inc.) April 1993 Seconded to Finance Bureau of Ministry of Home Affairs June 2003 Seconded to Tesac Corporation, a Company under Reorganization Trustee Representative, Manager of Corporate Planning Department October 2006 Registered as attorney at law Joined Nishimura & Asahi November 2010 Outside Director, USEN Corporation January 2012 Partner at Nishimura & Asahi June 2013 Substitute Auditor of KAGOME CO., LTD.
April 2021 Senior Managing Corporate Executive of BK April 2022 Deputy President of BK April 2023 Senior Managing Corporate Executive of MUFG (incumbent) June 2023 Member of the Board of Directors, Deputy President of BK (incumbent) Seiichiro Akita (November 11, 1966) Senior Managing Corporate Executive (Representative Corporate Executive) (Group Head, Japanese Corporate & Investment Banking Business Group(excluding in charge of Wealth Management Research Division)) April 1989 Joined The Mitsubishi Bank, Limited June 2015 Executive Officer of BK April 2019 Managing Executive Officer of BK May 2019 President & CEO, Bank of Ayudhya Public Company Limited May 2023 Deputy President of BK Senior Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) June 2023 Member of the Board of Directors, Deputy President of BK (incumbent) Hiroshi Mori (February 21, 1965) Managing Corporate Executive (Group Chief Legal Officer, or Group CLO) April 1989 Joined Development Bank of Japan (currently Development Bank of Japan, Inc.) April 1993 Seconded to Finance Bureau of Ministry of Home Affairs June 2003 Seconded to Tesac Corporation, a Company under Reorganization Trustee Representative, Manager of Corporate Planning Department October 2006 Registered as attorney at law Joined Nishimura & Asahi November 2010 Outside Director, USEN Corporation January 2012 Partner at Nishimura & Asahi June 2013 Substitute Auditor of KAGOME CO., LTD.
(incumbent) Yutaka Miyashita (October 11, 1967) Managing Corporate Executive (Representative Corporate Executive) (Group Chief Strategy Officer or Group CSO (Corporate Planning Division excluding Finances & Resources Management and Global Business) and in charge of Corporate Administration Division) April 1990 Joined The Sanwa Bank, Limited June 2016 Executive Officer of BK Executive Officer of MUFG April 2020 Managing Executive Officer of BK Managing Executive Officer of MUFG June 2020 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) April 2021 Managing Corporate Executive of MUFG April 2022 Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) 100 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Keitaro Tsukiyama (December 7, 1967) Managing Corporate Executive (Group Chief Compliance Officer, or Group CCO) April 1991 Joined The Mitsubishi Bank, Limited June 2018 Executive Officer of BK Executive Officer of MUFG April 2021 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) June 2021 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Fumitaka Nakahama (July 28, 1966) Managing Corporate Executive (Group Head, Global Corporate & Investment Banking Business Group) December 2009 Joined The Bank of Tokyo-Mitsubishi UFJ, Ltd.
June 2016 Outside Director, Audit & Supervisory Committee Member of SCHD June 2019 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Managing Corporate Executive of MUFG (incumbent) 99 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Yutaka Miyashita (October 11, 1967) Managing Corporate Executive (Representative Corporate Executive) (Group Head, Retail & Commercial Banking Business Group (excluding in charge of Wealth Management Research Division)) April 1990 Joined The Sanwa Bank, Limited June 2016 Executive Officer of BK Executive Officer of MUFG April 2020 Managing Executive Officer of BK Managing Executive Officer of MUFG June 2020 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) April 2021 Managing Corporate Executive of MUFG April 2022 Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) Keitaro Tsukiyama (December 7, 1967) Managing Corporate Executive (Group Chief Compliance Officer, or Group CCO) April 1991 Joined The Mitsubishi Bank, Limited June 2018 Executive Officer of BK Executive Officer of MUFG April 2021 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) June 2021 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Fumitaka Nakahama (July 28, 1966) Managing Corporate Executive (Group Head, Global Corporate & Investment Banking Business Group) December 2009 Joined The Bank of Tokyo-Mitsubishi UFJ, Ltd.
April 2022 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Hiroyuki Seki (March 10, 1968) Managing Corporate Executive (Group Head, Global Markets Business Group) April 1990 Joined The Mitsubishi Bank, Limited June 2016 Executive Officer of BK Executive Officer of MUFG April 2021 Managing Executive Officer of BK Managing Executive Officer of MUFG April 2022 Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Hideaki Takase (December 14, 1968) Managing Corporate Executive (Group Chief Operating Officer-International or Group COO-I, Deputy Group Head, Global Commercial Banking Business Group and in charge of the Americas and EMEA) April 1991 Joined The Mitsubishi Bank, Limited June 2018 Executive Officer of BK Executive Officer of MUFG August 2019 President & CEO of MUFG Bank (Europe) N.V.
April 2022 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Hiroyuki Seki (March 10, 1968) Managing Corporate Executive (Group Head, Global Markets Business Group) April 1990 Joined The Mitsubishi Bank, Limited June 2016 Executive Officer of BK Executive Officer of MUFG April 2021 Managing Executive Officer of BK Managing Executive Officer of MUFG April 2022 Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) 100 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Hideaki Takase (December 14, 1968) Managing Corporate Executive (Group Chief Strategy Officer, or Group CSO (Corporate Planning Division excluding Finances & Resources Management and Global Business) In charge of Corporate Administration Division) April 1991 Joined The Mitsubishi Bank, Limited June 2018 Executive Officer of BK Executive Officer of MUFG August 2019 President & CEO of MUFG Bank (Europe) N.V.
June 2021 Member of the Board of Directors (Outside Director) of MUFG (incumbent) Tarisa Watanagase (November 30, 1949) Member of the Board of Directors (Outside Director) June 1975 Joined the Bank of Thailand January 1988 Economist, International Monetary Fund (On the Secondment) October 2002 Deputy Governor of the Bank of Thailand November 2006 Governor of the Bank of Thailand September 2010 Retired from the Bank of Thailand March 2013 Outside Director of the Siam Cement Public Company Limited June 2017 Member of the Board of Directors (Outside Director) of MUFG (incumbent) 94 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Ritsuo Ogura (January 21, 1964) Member of the Board of Directors April 1986 Joined The Sanwa Bank, Limited June 2012 Executive Officer of BK Executive Officer of MUFG May 2016 Managing Executive Officer of BK May 2017 Managing Executive Officer of MUFG April 2019 Managing Corporate Executive of MUFG April 2020 Managing Executive Officer of MUFG June 2020 Member of the Board of Directors of MUFG (incumbent) Kenichi Miyanaga (February 25, 1960) Member of the Board of Directors April 1982 Joined The Toyo Trust and Banking Company, Limited June 2009 Executive Officer of TB June 2013 Director and Managing Executive Officer of TB June 2016 Senior Managing Executive Officer of TB June 2017 Director, Deputy President, and Executive Officer of TB Managing Executive Officer of MUFG June 2021 Member of the Board of Directors of MUFG (incumbent) Kanetsugu Mike (November 4, 1956) Member of the Board of Directors Chairman (Corporate Executive) April 1979 Joined The Mitsubishi Bank, Limited June 2005 Executive Officer of BK Executive Officer of MUFG May 2009 Managing Executive Officer of BK May 2011 Managing Executive Officer of MUFG June 2011 Member of the Board of Directors, Managing Executive Officer of BK May 2013 Senior Managing Executive Officer of BK October 2015 Executive Chairman of MUAH Executive Chairman of BK(US) May 2016 Deputy President and Executive Officer of BK Senior Managing Corporate Executive of MUFG June 2016 Member of the Board of Directors, Deputy President of BK June 2017 President & CEO of BK Member of the Board of Directors, Deputy Chairman of MUFG April 2019 Member of the Board of Directors, President & Group CEO of MUFG April 2020 Member of the Board of Directors, Deputy Chairman of MUFG April 2021 Member of the Board of Directors, Chairman of MUFG (incumbent) 95 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Hironori Kamezawa (November 18, 1961) Member of the Board of Directors President & Group CEO (Representative Corporate Executive) April 1986 Joined The Mitsubishi Bank, Limited June 2010 Executive Officer of BK Executive Officer of MUFG May 2014 Managing Executive Officer of BK Managing Executive Officer of MUFG July 2014 Deputy CEO of Americas at BK(US) May 2017 Managing Corporate Executive of MUFG June 2017 Member of the Board of Directors, Managing Executive Officer of BK May 2018 Member of the Board of Directors, Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG December 2018 CEO and Representative of the Board of Directors of Global Open Network, Inc.
(incumbent) 93 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Tarisa Watanagase (November 30, 1949) Member of the Board of Directors (Outside Director) June 1975 Joined the Bank of Thailand January 1988 Economist, International Monetary Fund (On the Secondment) October 2002 Deputy Governor of the Bank of Thailand November 2006 Governor of the Bank of Thailand September 2010 Retired from the Bank of Thailand March 2013 Outside Director of the Siam Cement Public Company Limited June 2017 Member of the Board of Directors (Outside Director) of MUFG (incumbent) Kenichi Miyanaga (February 25, 1960) Member of the Board of Directors April 1982 Joined The Toyo Trust and Banking Company, Limited June 2009 Executive Officer of TB June 2013 Director and Managing Executive Officer of TB June 2016 Senior Managing Executive Officer of TB June 2017 Director, Deputy President, and Executive Officer of TB Managing Executive Officer of MUFG June 2021 Member of the Board of Directors of MUFG (incumbent) Ryoichi Shinke (December 8, 1965) Member of the Board of Directors April 1988 Joined The Sanwa Bank, Limited June 2014 Executive Officer of BK May 2018 Managing Executive Officer of BK May 2020 Managing Executive Officer of MUFG April 2022 Senior Managing Executive Officer of BK June 2023 Member of the Board of Directors of MUFG (incumbent) 94 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Kanetsugu Mike (November 4, 1956) Member of the Board of Directors Chairman (Corporate Executive) April 1979 Joined The Mitsubishi Bank, Limited June 2005 Executive Officer of The Bank of Tokyo-Mitsubishi,Ltd.
The following table sets forth details of the aggregate compensation paid by MUFG and its subsidiaries during the fiscal year ended March 31, 2022 to our directors (excluding outside directors) and corporate executives: Non-Adjustable Compensation Adjustable Compensation Number of Directors and Corporate Executives (1) Aggregate Compensation Annual Base Salary Performance- based Stock Compensation Cash Bonuses Performance- based Stock Compensation Retirement Allowances (2) Other (in millions) 25 ¥ 2,876 ¥ 1,376 ¥ 416 ¥ 627 ¥ 399 ¥ 58 ¥ 0 Notes: (1) Includes the current directors and corporate executives as well as those who retired during the fiscal year ended March 31, 2022 but excludes the outside directors.
The following table sets forth details of the aggregate compensation paid by MUFG and its subsidiaries during the fiscal year ended March 31, 2023 to our directors (excluding outside directors), corporate executives and outside directors: Non-Adjustable Compensation Adjustable Compensation Classification Number of Recipients (1) Aggregate Compensation Annual Base Salary (2) Performance- based Stock Compensation Cash Bonuses Performance- based Stock Compensation (in millions) Directors (excluding outside directors) 6 ¥ 721 ¥ 338 ¥ 59 ¥ 217 ¥ 107 Corporate Executives 18 ¥ 1,968 ¥ 1,046 ¥ 318 ¥ 416 ¥ 188 Outside Directors 9 ¥ 244 ¥ 244 ― ― ― Notes: (1) Includes the current directors and corporate executives as well as those who retired during the fiscal year ended March 31, 2023.
Under the Companies Act, a resolution of the board of directors is required if any corporate executive wishes to engage in any business that is in competition with us or any transaction with us. 109 T a b l e o f C o n t e n t s Under the Companies Act and our articles of incorporation, we may exempt, by resolution of the board of directors, our corporate executives from liabilities to MUFG arising in connection with their failure to execute their duties in good faith and without gross negligence within the limits stipulated by applicable laws and regulations.
Under the Companies Act and our articles of incorporation, we may exempt, by resolution of the board of directors, our corporate executives from liabilities to MUFG arising in connection with their failure to execute their duties in good faith and without gross negligence within the limits stipulated by applicable laws and regulations.
Japan 91 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience July 2013 Executive Vice President & CEO of Multilateral Investment Guarantee Agency (World Bank Group) October 2019 Retired from Multilateral Investment Guarantee Agency (World Bank Group) January 2020 Joined Columbia University School of International and Public Affairs as Adjunct Professor and Adjunct Senior Research Scholar (incumbent) March 2020 Outside Director of AGC Inc.
Japan July 1999 Partner of McKinsey & Company July 2007 Director (Senior Partner) of McKinsey & Company July 2013 Executive Vice President of Multilateral Investment Guarantee Agency (World Bank Group) June 2014 Executive Vice President & CEO of Multilateral Investment Guarantee Agency (World Bank Group) October 2019 Retired from Multilateral Investment Guarantee Agency (World Bank Group) January 2020 Columbia University School of International and Public Affairs as Adjunct Professor and Adjunct Senior Research Scholar (incumbent) March 2020 Outside Director of AGC Inc.
(incumbent) Chairman and Representative of the Board of Directors of Global Open Network Japan, Inc. June 2020 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) June 2022 Chairman, CEO and Representative of the Board of Directors of Global Open Network Japan, Inc.
May 2017 Managing Corporate Executive of MUFG June 2017 Member of the Board of Directors, Managing Executive Officer of BK May 2018 Member of the Board of Directors, Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG December 2018 CEO and Representative of the Board of Directors of Global Open Network, Inc.
We believe our labor relations to be good. E. Share Ownership The information required by this item is set forth in “—B. Compensation.” 111 T a b l e o f C o n t e n t s
We believe our labor relations to be good. E. Share Ownership The information required by this item is set forth in “—B. Compensation.” F. Disclosure of a Registrant’s Action to Recover Erroneously Awarded Compensation Not applicable. 110 Table of Contents
The other members of the committee are Keiko Honda, Kaoru Kato and Yasushi Shingai, who are independent outside directors, and Ritsuo Ogura and Kenichi Miyanaga, who are non-executive directors.
The other members of the committee are Keiko Honda and Kaoru Kato, who are independent outside directors, and Kenichi Miyanaga and Ryoichi Shinke, who are non-executive directors. Between April 2022 and March 2023, the audit committee met 16 times.
Between April 2021 and March 2022, the audit committee met 16 times. 108 T a b l e o f C o n t e n t s Compensation Committee The compensation committee establishes our policy regarding the determination of the compensation of MUFG’s directors, corporate executives, executive officers (shikko yakuin) and others and also determines the details of individual compensation based on the policy.
Compensation Committee The compensation committee establishes our policy regarding the determination of the compensation of MUFG’s directors, corporate executives, executive officers ( shikko yakuin ) and others and also determines the details of individual compensation based on the policy.
For more information, see “—Retirement Allowances” below. 102 T a b l e o f C o n t e n t s The following table sets forth the details of individual compensation paid, including benefits in kind granted by MUFG and its subsidiaries, in an amount equal to or exceeding ¥100 million during the fiscal year ended March 31, 2022: Non-Adjustable Compensation Adjustable Compensation Directors Aggregate Compensation Paid by Annual Base Salary Performance- based Stock Compensation Cash Bonuses Performance- based Stock Compensation Retirement Allowances (2) (in millions) Kanetsugu Mike ¥ 241 MUFG ¥ 75 ¥ 19 ¥ 59 ¥ 32 — BK — — — 10 46 Saburo Araki ¥ 185 MUFG ¥ 25 ¥ 5 ¥ 40 ¥ 26 — SCHD 13 2 22 13 — MUMSS 13 2 11 13 — Iwao Nagashima ¥ 197 MUFG ¥ 35 ¥ 7 ¥ 37 ¥ 21 — TB 35 13 29 20 — Junichi Hanzawa ¥ 276 MUFG ¥ 41 ¥ 9 ¥ 42 ¥ 20 — BK 45 59 41 19 — Hironori Kamezawa ¥ 252 MUFG ¥ 71 ¥ 21 ¥ 89 ¥ 46 — BK 18 6 — 1 — Masato Miyachi ¥ 137 MUFG ¥ 46 ¥ 8 ¥ 20 ¥ 8 — BK 27 10 12 6 — Takayoshi Futae ¥ 139 MUFG ¥ 41 ¥ 8 ¥ 17 ¥ 7 — BK 22 18 10 4 — SCHD 8 2 0 2 — Masahiro Kuwahara ¥ 107 MUFG ¥ 33 ¥ 7 ¥ 12 ¥ 7 — BK 19 8 7 4 — SCHD 10 — — — — Yoshitaka Shiba ¥ 103 MUFG ¥ 61 ¥ 12 ¥ 18 ¥ 10 — BK — — — 2 — Tetsuya Yonehana ¥ 104 MUFG ¥ 39 ¥ 9 ¥ 11 ¥ 7 — BK 22 5 6 4 — TB — — — 1 — Naomi Hayashi ¥ 124 MUFG ¥ 39 ¥ 8 ¥ 11 ¥ 7 — BK 22 25 7 5 — Atsushi Miyata ¥ 122 MUFG ¥ 39 ¥ 8 ¥ 10 ¥ 7 — BK 22 25 6 5 — Shigeru Yoshifuji ¥ 107 MUFG ¥ 39 ¥ 9 ¥ 12 ¥ 7 — BK 22 6 7 5 — Notes: (1) The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd.
The following table sets forth the details of individual compensation paid, including benefits in kind granted by MUFG and its subsidiaries, in an amount equal to or exceeding ¥100 million during the fiscal year ended March 31, 2023: Non-Adjustable Compensation Adjustable Compensation Directors Aggregate Compensation Paid by Annual Base Salary Performance- based Stock Compensation Cash Bonuses Performance- based Stock Compensation (in millions) Kanetsugu Mike ¥ 162 MUFG ¥ 52 ¥ 21 ¥ 66 ¥ 23 Hironori Kamezawa ¥ 257 MUFG ¥ 71 ¥ 23 ¥ 99 ¥ 39 BK 18 7 ― ― Iwao Nagashima ¥ 194 MUFG ¥ 35 ¥ 8 ¥ 37 ¥ 17 TB 35 14 31 17 Junichi Hanzawa ¥ 250 MUFG ¥ 42 ¥ 10 ¥ 49 ¥ 20 BK 46 14 49 20 Makoto Kobayashi ¥ 113 MUFG ¥ 19 ¥ 3 ¥ 24 ¥ 11 SCHD 9 2 12 5 MUMSS ¥ 9 ¥ 2 ¥ 12 ¥ 5 Yoshitaka Shiba ¥ 100 MUFG ¥ 61 ¥ 13 ¥ 17 ¥ 9 Naomi Hayashi ¥ 141 MUFG ¥ 44 ¥ 10 ¥ 20 ¥ 7 BK 26 16 13 5 Atsushi Miyata ¥ 141 MUFG ¥ 44 ¥ 10 ¥ 20 ¥ 7 BK 26 16 13 5 Teruyuki Sasaki ¥ 116 MUFG ¥ 39 ¥ 7 ¥ 10 ¥ 5 BK 22 23 6 4 Note: (1) The following abbreviations are used in the table above: “BK” refers to MUFG Bank, Ltd.
June 2012 Executive Officer of BK July 2015 Executive Officer of MUFG May 2016 Managing Executive Officer of BK April 2020 Senior Managing Corporate Executive of MUFG (incumbent) Tetsuya Yonehana (February 10, 1964) Senior Managing Corporate Executive (Representative Corporate Executive) (Group Chief Financial Officer, or Group CFO) April 1986 Joined The Mitsubishi Trust and Banking Corporation June 2012 Executive Officer of TB Executive Officer of MUFG June 2015 Managing Executive Officer of TB June 2016 Director and Managing Executive Officer of TB Managing Executive Officer of MUFG April 2019 Director and Senior Managing Executive Officer of TB April 2020 Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG June 2020 Member of the Board of Directors, Senior Managing Executive Officer of BK (incumbent) April 2022 Senior Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) 98 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Naomi Hayashi (March 16, 1965) Senior Managing Corporate Executive (Representative Corporate Executive) (Group Head, Japanese Corporate & Investment Banking Business Group (excluding in charge of Wealth Management Research Division)) April 1987 Joined The Mitsubishi Bank, Limited June 2013 Executive Officer of BK Executive Officer of MUFG January 2017 Managing Executive Officer of BK May 2018 Managing Corporate Executive of MUFG June 2018 Member of the Board of Directors, Managing Executive Officer of BK Member of the Board of Directors of SCHD April 2021 Member of the Board of Directors, Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG April 2022 Member of the Board of Directors, Deputy President of BK (incumbent) Senior Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) Atsushi Miyata (March 29,1964) Senior Managing Corporate Executive (Representative Corporate Executive) (Group Head, Retail & Commercial Banking Business Group, Head of Wealth Management Unit (excluding in charge of Wealth Management Research Division)) April 1987 Joined The Sanwa Bank, Limited June 2013 Executive Officer of BK May 2015 Executive Officer of MUFG May 2017 Managing Executive Officer of BK July 2018 Managing Executive Officer of MUFG April 2021 Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG June 2021 Member of the Board of Directors, Senior Managing Executive Officer of BK April 2022 Member of the Board of Directors, Deputy President of BK (incumbent) Senior Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) Takayuki Yasuda (June 19, 1963) Senior Managing Corporate Executive (Group Head, Asset Management & Investor Services Business Group) April 1987 Joined The Mitsubishi Trust and Banking Corporation June 2013 Executive Officer of TB February 2015 Executive Officer of MUFG June 2017 Managing Executive Officer of TB April 2021 Director and Senior Managing Executive Officer of TB (incumbent) Senior Managing Corporate Executive of MUFG (incumbent) Teruyuki Sasaki (January 12, 1965) Senior Managing Corporate Executive (Group Chief Human Resource Officer, or Group CHRO) April 1988 Joined The Sanwa Bank, Limited June 2014 Executive Officer of BK June 2017 President & CEO of The Mitsubishi UFJ Factors Limited.
June 2012 Executive Officer of BK July 2015 Executive Officer of MUFG May 2016 Managing Executive Officer of BK April 2020 Senior Managing Corporate Executive of MUFG (incumbent) Tetsuya Yonehana (February 10, 1964) Senior Managing Corporate Executive (Representative Corporate Executive) (Group Chief Financial Officer, or Group CFO) April 1986 Joined The Mitsubishi Trust and Banking Corporation June 2012 Executive Officer of TB Executive Officer of MUFG June 2015 Managing Executive Officer of TB June 2016 Director and Managing Executive Officer of TB Managing Executive Officer of MUFG April 2019 Director and Senior Managing Executive Officer of TB April 2020 Senior Managing Executive Officer of BK Senior Managing Corporate Executive of MUFG June 2020 Member of the Board of Directors, Senior Managing Executive Officer of BK (incumbent) April 2022 Senior Managing Corporate Executive (Representative Corporate Executive) of MUFG (incumbent) Takayuki Yasuda (June 19, 1963) Senior Managing Corporate Executive (Group Head, Asset Management & Investor Services Business Group) April 1987 Joined The Mitsubishi Trust and Banking Corporation June 2013 Executive Officer of TB February 2015 Executive Officer of MUFG June 2017 Managing Executive Officer of TB April 2021 Director and Senior Managing Executive Officer of TB Senior Managing Corporate Executive of MUFG (incumbent) April 2023 Director, Deputy President, and Executive Officer of TB (incumbent) 98 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Yasushi Itagaki (May 24, 1964) Senior Managing Corporate Executive (Group Chief Operating Officer-International, or Group COO-I, Group Head Global Commercial Banking Business Group) April 1987 Joined The Bank of Tokyo, Ltd.
Board Practices Our articles of incorporation provide for a board of directors with statutorily mandated nominating and governance committee, audit committee and compensation committee, each consisting of members of the board of directors. We have also elected, though not statutorily mandated under the Companies Act of Japan, to establish a risk committee consisting of directors and external experts.
We have also elected, though not statutorily mandated under the Companies Act of Japan, to establish a risk committee consisting of directors and external experts. We also have a U.S. risk committee pursuant to the U.S. Enhanced Prudential Standards for foreign banking organizations.
We, however, currently have no such arrangements with any of our corporate executives. D. Employees As of March 31, 2022, we had approximately 129,700 employees, a decrease of approximately 3,000 employees compared with the number of employees as of March 31,2021. In addition, as of March 31, 2022, we had approximately28,400 part-time and temporary employees.
We, however, currently have no such arrangements with any of our corporate executives. D. Employees As of March 31, 2023, we had approximately 121,800 employees, a decrease of approximately 7,900 employees compared with the number of employees as of March 31, 2022 primarily due to the sale of MUFG Union Bank, N.A. in December 2022.
“TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd. “BK(US)” refers to MUFG Union Bank, N.A. “MUAH” refers to MUFG Americas Holdings Corporation. The board of directors and corporate executives may be contacted through our headquarters at Mitsubishi UFJ Financial Group, Inc., 7-1, Marunouchi 2-chome, Chiyoda-ku, Tokyo 100-8330, Japan.
The board of directors and corporate executives may be contacted through our headquarters at Mitsubishi UFJ Financial Group, Inc., 7-1, Marunouchi 2-chome, Chiyoda-ku, Tokyo 100-8330, Japan. No family relationship exists among any of our directors or corporate executives. 101 Table of Contents B.
June 2017 Executive Officer of BK August 2019 President & CEO of MUFG Bank (China), Ltd.
June 2013 Executive Officer of BK July 2013 Executive Officer of MUFG May 2017 Managing Executive Officer of BK October 2019 President & CEO of PT Bank Danamon Indonesia, Tbk.
Myerson 368* Hirofumi Nomoto 25,000 Yasushi Shingai — Koichi Tsuji — Tarisa Watanagase — Ritsuo Ogura 95,534 Kenichi Miyanaga 183,678 Iwao Nagashima 129,081 Junichi Hanzawa 58,900 Makoto Kobayashi 153,058 Corporate Executives Number of Shares Registered Kanetsugu Mike 292,062 Hironori Kamezawa 69,639 Yoshitaka Shiba 129,403 Tetsuya Yonehana 89,922 Naomi Hayashi 26,810 Atsushi Miyata 45,297 Takayuki Yasuda 30,500 Teruyuki Sasaki 51,521 Hiroshi Mori 8,285 Masakazu Osawa 15,200 Yutaka Miyashita 26,400 Keitaro Tsukiyama 26,769 Fumitaka Nakahama 11,269 Toshiki Ochi 18,800 Hiroyuki Seki 23,150 Hideaki Takase 16,300 Kenichi Yamato 35,326 Shuichi Yokoyama 39,800 * Held in the form of ADRs.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers.” Share Ownership As of July 1, 2023, our directors and corporate executives held the following numbers of shares of our common stock: Directors Number of Shares Registered Mariko Fujii — Keiko Honda — Kaoru Kato — Satoko Kuwabara — Hirofumi Nomoto 25,000 David Sneider ― Koichi Tsuji — Tarisa Watanagase — Kenichi Miyanaga 183,678 Ryoichi Shinke 1,100 Iwao Nagashima 129,081 Junichi Hanzawa 58,900 Makoto Kobayashi 153,058 104 Table of Contents Corporate Executives Number of Shares Registered Kanetsugu Mike 292,062 Hironori Kamezawa 69,639 Yoshitaka Shiba 129,403 Tetsuya Yonehana 89,922 Takayuki Yasuda 30,500 Yasushi Itagaki ― Hiroshi Mori 8,285 Yutaka Miyashita 26,400 Keitaro Tsukiyama 26,769 Fumitaka Nakahama 11,269 Toshiki Ochi 18,800 Hiroyuki Seki 23,150 Hideaki Takase 15,800 Shuichi Yokoyama 39,800 Kenji Horikawa 61,667 Tadashi Yamamoto 9,400 Seiichiro Akita 3,712 None of the shares of our common stock held by our directors and corporate executives have voting rights that are different from shares of our common stock held by any other shareholder.
(incumbent) 92 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience April 2020 Partner of Gaien Partners (incumbent) June 2020 Outside Audit and Supervisory Board Member of Nippon Yusen Kabushiki Kaisha (incumbent) June 2021 Member of the Board of Director (Outside Director) of MUFG (incumbent) Toby S.
(incumbent) April 2020 Partner of Gaien Partners (incumbent) June 2020 Outside Audit and Supervisory Board Member of Nippon Yusen Kabushiki Kaisha June 2021 Member of the Board of Director (Outside Director) of MUFG (incumbent) June 2023 Outside Director of Nippon Yusen Kabushiki Kaisha (incumbent) 92 Table of Contents Name (Date of Birth) Position in MUFG Business Experience Hirofumi Nomoto (September 27, 1947) Member of the Board of Directors (Outside Director) April 1971 Joined TOKYU CORPORATION April 2003 Executive General Manager of Media Business Headquarters of TOKYU CORPORATION April 2004 President & Representative Director of its communications Inc.
Myerson (July 20, 1949) Member of the Board of Directors (Outside Director) September 1977 Registered as an attorney at law, admitted in States of New York and California in the United States October 1981 Joined Paul, Weiss, Rifkind, Wharton & Garrison LLP June 1983 Partner of Paul, Weiss, Rifkind, Wharton & Garrison LLP April 1989 Managing Director of Wasserstein Perella & Co.
(incumbent) Member of the Board of Directors (Outside Director) of MUFG (incumbent) David Sneider (July 25, 1957) Member of the Board of Directors (Outside Director) December 1984 Associate of Paul, Weiss, Rifkind, Wharton & Garrison LLP June 1985 Registered as an attorney at law, admitted in States of New York in the United States July 1987 Director and Counsel of Legal Department, Salomon Brothers Inc.
For information on the performance-based stock compensation for our directors and corporate executives, see “—Performance-based Stock Compensation Plans.” 106 T a b l e o f C o n t e n t s C.
For information on the performance-based stock compensation for our directors and corporate executives, see “—Performance-based Stock Compensation Plans.” C. Board Practices Our articles of incorporation provide for a board of directors with statutorily mandated nominating and governance committee, audit committee and compensation committee, each consisting of members of the board of directors.
June 2016 Outside Director, Audit & Supervisory Committee Member of SCHD June 2019 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Managing Corporate Executive of MUFG (incumbent) Masakazu Osawa (June 20, 1968) Managing Corporate Executive (Group Head, Digital Service Business Group Group Chief Digital Transformation Officer, or Group CDTO) April 1991 Joined The Mitsubishi Bank, Limited June 2017 Executive Officer of BK Executive Officer of MUFG April 2020 Managing Executive Officer of BK Managing Corporate Executive of MUFG (incumbent) CEO and Representative of the Board of Directors of Global Open Network, Inc.
June 2016 Executive Officer of BK Executive Officer of MUFG April 2020 Managing Executive Officer of BK April 2022 Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) Kenji Horikawa (December 9, 1967) Managing Corporate Executive (Group Chief Human Resources Officer, or Group CHRO) April 1990 Joined The Sanwa Bank, Limited June 2016 Executive Officer of BK April 2020 Managing Executive Officer of SCHD Managing Executive Officer of MUMSS Managing Executive Officer of MUFG April 2022 Member of the Board of Directors, Managing Executive Officer of SCHD Member of the Board of Directors, Managing Executive Officer of MUMSS April 2023 Managing Corporate Executive of MUFG (incumbent) Tadashi Yamamoto (May 23, 1969) Managing Corporate Executive (Group Head, Digital Service Business Group Group Chief Digital Transformation Officer, or Group CDTO) April 1992 Joined The Bank of Tokyo, Ltd.
A reserve in the total amount of such retirement allowances was set aside as of September 30, 2007. For more information, see “—Retirement Allowances” below. Annual Base Salary Annual base salaries were paid to our directors (including outside directors) and corporate executives in the form of monthly cash installment payments.
“MUMSS” refers to Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. 102 Table of Contents Annual Base Salary Annual base salaries were paid to our directors (including outside directors) and corporate executives in the form of monthly cash installment payments.
March 2018 Outside Director of Asahi Group Holdings, Ltd. June 2018 Outside Director of ExaWizards Inc. (incumbent) Member of the Board of Directors (Outside Director) of MUFG (incumbent) June 2019 Outside Director of Dai-ichi Life Holdings, Inc.
June 2021 Member of the Board of Directors (Outside Director) of MUFG (incumbent) June 2023 Outside Statutory Auditor of TEIJIN LIMITED (incumbent) Outside Director of MARUICHI STEEL TUBE LTD.
Removed
October 2015 Retired from The University of Tokyo Retired from Outside Director of Electric Power Development Co., Ltd.
Added
Executive Officer of Mitsubishi Tokyo Financial Group, Inc. May 2009 Managing Executive Officer of BK May 2011 Managing Executive Officer of MUFG June 2011 Member of the Board of Directors, Managing Executive Officer of BK May 2013 Senior Managing Executive Officer of BK October 2015 Executive Chairman of MUAH Executive Chairman of MUFG Union Bank, N.A.
Removed
July 1989 Joined McKinsey & Company, Inc. Japan July 1999 Partner of McKinsey & Company, Inc. Japan July 2007 Director (Senior Partner) of McKinsey & Company, Inc.
Added
May 2016 Deputy President and Executive Officer of BK Senior Managing Corporate Executive of MUFG June 2016 Member of the Board of Directors, Deputy President of BK June 2017 President & CEO of BK Member of the Board of Directors, Deputy Chairman of MUFG April 2019 Member of the Board of Directors, President & Group CEO of MUFG April 2020 Member of the Board of Directors, Deputy Chairman of MUFG April 2021 Member of the Board of Directors, Chairman of MUFG (incumbent) Hironori Kamezawa (November 18, 1961) Member of the Board of Directors President & Group CEO (Representative Corporate Executive) April 1986 Joined The Mitsubishi Bank, Limited June 2010 Executive Officer of BK Executive Officer of MUFG May 2014 Managing Executive Officer of BK Managing Executive Officer of MUFG July 2014 Deputy CEO of Americas at MUFG Union Bank, N.A.
Removed
November 1990 Partner of Paul, Weiss, Rifkind, Wharton & Garrison LLP June 2014 Outside Director of BK(US) (incumbent) December 2016 Retired from Paul, Weiss, Rifkind, Wharton & Garrison LLP January 2017 Chairman & CEO of Longsight Strategic Advisors LLC (incumbent) February 2017 Outside Director of MUAH (incumbent) June 2017 Member of the Board of Directors (Outside Director) of MUFG (incumbent) Hirofumi Nomoto (September 27, 1947) Member of the Board of Directors (Outside Director) April 1971 Joined TOKYU CORPORATION April 2003 Executive General Manager of Media Business Headquarters of TOKYU CORPORATION April 2004 President & Representative Director of its communications Inc.
Added
“TB” refers to Mitsubishi UFJ Trust and Banking Corporation. “SCHD” refers to Mitsubishi UFJ Securities Holdings Co., Ltd. “MUMSS” refers to Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. “MUAH” refers to MUFG Americas Holdings Corporation.
Removed
(incumbent) Member of the Board of Directors (Outside Director) of MUFG (incumbent) 93 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Yasushi Shingai (January 11, 1956) Member of the Board of Directors (Outside Director) April 1980 Joined Japan Tobacco and Salt Public Corporation (current Japan Tobacco Inc.) July 2001 Vice President of Finance Planning Division of Japan Tobacco Inc.
Added
Each grantee receives shares of MUFG common stock in exchange for points upon the grantee’s departure from his or her job responsibilities based on which the right to receive such shares was granted.
Removed
June 2004 Senior Vice President, Head of Finance Group of Japan Tobacco Inc. July 2004 Senior Vice President, Chief Financial Officer of Japan Tobacco Inc. June 2005 Member of the Board, Senior Vice President, and Chief Financial Officer of Japan Tobacco Inc.
Added
Under the Companies Act, a resolution of the board of directors is required if any corporate executive wishes to engage in any business that is in competition with us or any transaction with us.
Removed
June 2006 Member of the Board of Japan Tobacco Inc., Executive Vice President and Deputy CEO of JT International S.A. June 2011 Representative Director and Executive Vice President of Japan Tobacco Inc. June 2014 External Board Director of Recruit Holdings Co., Ltd. January 2018 Member of the Board of Japan Tobacco Inc.
Added
In addition, as of March 31, 2023, we had approximately 27,900 part-time and temporary employees.
Removed
See “Members of the Board of Directors” under this Item 6.A. Junichi Hanzawa (January 19, 1965) See “Members of the Board of Directors” under this Item 6.A. See “Members of the Board of Directors” under this Item 6.A. Makoto Kobayashi (February 22, 1962) See “Members of the Board of Directors” under this Item 6.A.
Removed
April 2021 Managing Executive Officer of BK April 2022 Managing Corporate Executive of MUFG (incumbent) June 2022 Member of the Board of Directors, Managing Executive Officer of BK (incumbent) 101 T a b l e o f C o n t e n t s Name (Date of Birth) Position in MUFG Business Experience Kenichi Yamato (June 27, 1968) Managing Corporate Executive (Group Head, Global Commercial Banking Business Group, Group Deputy COO-I and in charge of Asia) April 1991 Joined The Bank of Tokyo, Ltd.
Removed
No family relationship exists among any of our directors or corporate executives. B.
Removed
Compensation The aggregate amount of compensation paid, including benefits in kind granted and any contingent and deferred compensation, by MUFG and its subsidiaries during the fiscal year ended March 31, 2022 to our directors (excluding outside directors), to corporate executives and to outside directors, was ¥177 million, ¥2,699 million and ¥236 million, respectively.
Removed
(2) Represents the aggregate amount of retirement allowances paid in cash during the fiscal year ended March 31, 2022, pursuant to a one-time shareholders’ approval in June 2007 for the retirement allowances to be paid to the directors and corporate auditors who were elected prior to that date at the time of their retirement.
Removed
A reserve in the total amount of such retirement allowances was set aside as of September 30, 2007.
Removed
(2) Represents the amount of retirement allowances paid in cash during the fiscal year ended March 31, 2022, pursuant to a one-time shareholders’ approval in June 2007 for the retirement allowances to be paid to the directors and corporate auditors who were elected prior to that date at the time of their retirement.
Removed
The aggregate annual base salary paid to our directors (excluding outside directors) and corporate 103 T a b l e o f C o n t e n t s executives for the fiscal year ended March 31, 2022 was ¥1,376 million. The aggregate annual base salary paid to our outside directors for the same period was ¥236 million.
Removed
The aggregate cash bonus paid to our directors and corporate executives for the fiscal year ended March 31, 2022 was ¥627 million.
Removed
Retirement Allowances Prior to June 28, 2007, in accordance with customary Japanese practice, when a director or corporate auditor retired, a proposal to pay a retirement allowance was submitted at the annual ordinary general meeting of shareholders for approval.
Removed
The retirement allowance consisted of a one-time payment of a portion of the allowance paid at the time of retirement and periodic payments of the remaining amount for a prescribed number of years.
Removed
After the shareholders’ approval was obtained, the retirement allowance for a director or corporate auditor was fixed by the board of directors or by consultation among the corporate auditors in accordance with our internal regulations and practice and generally reflected the position of the director or corporate auditor at the time of retirement, the length of his service as a director or corporate auditor and his contribution to our performance.
Removed
Historically, MUFG did not set aside reserves for any retirement payments for directors and corporate auditors made under this practice. Pursuant to a one-time shareholders’ approval in June 2007, retirement allowances are paid in cash to the directors and corporate auditors who were elected prior to that date at the time of their retirement.
Removed
A reserve in the total amount of such retirement allowances was set aside as of September 30, 2007.
Removed
The aggregate amount of retirement allowances paid in cash by MUFG and its subsidiaries pursuant to the one-time shareholder approval during the fiscal year ended March 31, 2022 to our directors (excluding outside directors), to corporate auditors (excluding outside corporate auditors) and to outside directors and corporate auditors, who have retired from their respective positions held at MUFG or, if such directors and corporate auditors concurrently held positions at MUFG’s subsidiaries, who have retired from such positions, was ¥58 million, nil and nil, respectively.

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

11 edited+0 added−1 removed13 unchanged
Although for the fiscal year ended March 31, 2022, such transactions included, but were not limited to, call money, loans, electronic data processing, leases and management of properties, those transactions were immaterial and were made at prevailing market rates, terms and conditions and do not involve more than the normal risk of collectability or present other unfavorable features.
Although for the fiscal year ended March 31, 2023, such transactions included, but were not limited to, call money, loans, electronic data processing, leases and management of properties, those transactions were immaterial and were made at prevailing market rates, terms and conditions and do not involve more than the normal risk of collectability or present other unfavorable features.
The ten largest holders of our common stock appearing on the register of shareholders as of March 31, 2022, and the number and the percentage of such shares held by each of them, were as follows: Name Number of shares held Percentage of total shares in issue (3) The Master Trust Bank of Japan, Ltd.
The ten largest holders of our common stock appearing on the register of shareholders as of March 31, 2023, and the number and the percentage of such shares held by each of them, were as follows: Name Number of shares held Percentage of total shares in issue (3) The Master Trust Bank of Japan, Ltd.
According to a beneficial ownership report on Schedule 13G filed with the SEC by Sumitomo Mitsui Trust Holdings, Inc. on February 4, 2022, Sumitomo Mitsui Trust Holdings and its consolidated subsidiaries beneficially owned an aggregate of 5.4% of the outstanding shares of our common stock as of December 31, 2021.
According to a beneficial ownership report on Schedule 13G filed with the SEC by Sumitomo Mitsui Trust Holdings, Inc. on February 3, 2023, Sumitomo Mitsui Trust Holdings and its consolidated subsidiaries beneficially owned an aggregate of 5.6% of the outstanding shares of our common stock as of December 31, 2022.
Related Party Transactions As of March 31, 2022, we held approximately 21.5% of the voting rights in Morgan Stanley and Series C Preferred Stock with a face value of approximately $521.4 million and 10% dividend. We also have two representatives appointed to Morgan Stanley’s board of directors.
Related Party Transactions As of March 31, 2023, we held approximately 22.6% of the voting rights in Morgan Stanley and Series C Preferred Stock with a face value of approximately $521.4 million and 10% dividend. We also have two representatives appointed to Morgan Stanley’s board of directors.
Other than as described in the table above, we have not independently confirmed this beneficial ownership information. As of March 31, 2022, 1,836,807 shares, representing approximately 0.01% of our outstanding common stock, were held by our directors and corporate executives.
Other than as described in the table above, we have not independently confirmed this beneficial ownership information. As of March 31, 2023, 1,573,884 shares, representing approximately 0.01% of our outstanding common stock, were held by our directors and corporate executives.
(4) According to a beneficial ownership report on Schedule 13G filed with the SEC by BlackRock Inc. on January 31, 2022, BlackRock and its consolidated subsidiaries beneficially owned an aggregate of 5.7% of the outstanding shares of our common stock as of December 31, 2021.
(4) According to a beneficial ownership report on Schedule 13G filed with the SEC by BlackRock Inc. on February 1, 2023, BlackRock and its consolidated subsidiaries beneficially owned an aggregate of 6.2% of the outstanding shares of our common stock as of December 31, 2022.
Item 7. Major Shareholders and Related Party Transactions. A. Major Shareholders Common Stock As of March 31, 2022, we had 933,949 registered shareholders of our common stock.
Item 7. Major Shareholders and Related Party Transactions. A. Major Shareholders Common Stock As of March 31, 2023, we had 1,064,553 registered shareholders of our common stock.
As of March 31, 2022, 2,177,129,996 shares, representing 16.39% of our outstanding common stock, were owned by 387 U.S. shareholders of record who are resident in the United States, one of whom is the ADR depository’s nominee holding 233,704,588 shares, or 1.75%, of our total issued shares of common stock. Our major shareholders do not have different voting rights. B.
As of March 31, 2023, 1,815,944,634 shares, representing 14.31% of our outstanding common stock, were owned by 407 U.S. shareholders of record who are resident in the United States, one of whom is the ADR depository’s nominee holding 241,322,875 shares, or 1.90%, of our total issued shares of common stock. Our major shareholders do not have different voting rights. B.
We hold a 60% voting interest and Morgan Stanley holds a 40% voting interest in Mitsubishi 112 T a b l e o f C o n t e n t s UFJ Morgan Stanley Securities, and we hold a 49% voting interest and Morgan Stanley holds a 51% voting interest in Morgan Stanley MUFG Securities.
We hold a 60% voting interest and Morgan Stanley holds a 40% voting interest in Mitsubishi 111 Table of Contents UFJ Morgan Stanley Securities, and we hold a 49% voting interest and Morgan Stanley holds a 51% voting interest in Morgan Stanley MUFG Securities.
(Meiji Yasuda Life Insurance Company retirement benefit trust account) 175,000,000 1.31 % JP MORGAN CHASE BANK 385781 169,142,961 1.27 % Toyota Motor Corporation 149,263,153 1.12 % Nippon Life Insurance Company 142,562,953 1.07 % Total 4,606,293,559 34.68 % Notes: (1) Includes the shares held in trust accounts, which do not disclose the names of beneficiaries.
(Meiji Yasuda Life Insurance Company retirement benefit trust account) 175,000,000 1.37 % JP MORGAN CHASE BANK 385781 166,053,638 1.30 % JPMorgan Securities Japan Co., Ltd. 152,600,825 1.20 % Toyota Motor Corporation 149,263,153 1.17 % GOVERNMENT OF NORWAY 147,989,424 1.16 % Total 4,194,963,246 33.02 % Notes: (1) Includes the shares held in trust accounts, which do not disclose the names of beneficiaries.
(Trust account) (1) 697,488,500 5.25 % BNYM AS AGT/CLTS NON TREATY JASDEC 534,632,894 4.02 % SSBTC CLIENT OMNIBUS ACCOUNT 284,445,619 2.14 % The Bank of New York Mellon as Depositary Bank for DR Holders (2) 233,704,588 1.75 % State Street Bank West Client-Treaty 505234 209,100,091 1.57 % The Master Trust Bank of Japan, Ltd.
(Trust account) (1) 1,945,291,400 15.33 % Custody Bank of Japan, Ltd. (Trust account) (1) 741,362,200 5.84 % SSBTC CLIENT OMNIBUS ACCOUNT 257,748,540 2.03 % THE BANK OF NEW YORK MELLON AS DEPOSITARY BANK FOR DR HOLDERS (2) 241,322,875 1.90 % STATE STREET BANK WEST CLIENT - TREATY 505234 218,331,191 1.72 % The Master Trust Bank of Japan, Ltd.
Removed
(Trust account) (1) 2,010,952,800 15.14 % Custody Bank of Japan, Ltd.

Other MUFG 10-K year-over-year comparisons