Corporate Governance System

System Overview
Board of Directors
Support System for Outside Directors
Succession plan
Elections and Dismissals of Executive Officers, Nominations of Director Candidates
Policy for Determining Amount or Calculation Method of Compensation, etc., for Directors and Executive Officers

System Overview

JAPAN POST BANK adopted the company with three statutory committees system of corporate governance to implement rapid decision-making and to increase management transparency. This is deemed to be a system under which the Board of Directors and each statutory and voluntarily established committee can provide appropriate oversight of management.

A Diagram of General Meeting of Shareholders

Supervisory Function

As of July 1, 2023

	Role and composition (as of July 1, 2023)	Main agenda / Operational status (FY2023/3)	Number of times held (FY2023/3)
Board of Directors	The JAPAN POST BANK Board of Directors has 14 members (five women and nine men), and of these nine are Outside Directors. Directors who possess diverse experience and knowledge work to oversee the Bank’s operations.	In FY2023/3, the Board of Directors discussed important management strategy issues, which included the establishment of the Risk Committee, formulation of the FY2024/3 management plan, establishment of the Basic Policy on Internal Auditing, the upgrade and expansion of the corporate governance systems, as well as the capital policy regarding the offering of shares of the Bank’s common stock held by JAPAN POST HOLDINGS Co., Ltd., and the repurchase and cancellation of the Bank’s shares. From the perspective of ensuring the propriety of operations, the Board of Directors also supervised business execution in an appropriate manner.	13 times
Nomination Committee	Comprising five directors (three of whom are outside directors), this committee determines the criteria regarding the election and dismissal of directors. In addition, it determines the content of proposals regarding the election and dismissal of directors that are submitted to general meetings of shareholders.	In FY2023/3, the Nomination Committee decided on candidates for directors and discussed president succession plans and other matters.	13 times
Compensation Committee	Comprising four directors (three of whom are outside directors), this committee decides the Policy for Determining the Details of Individual Compensation for Directors and Executive Officers. It also decides the content of individual compensation for executive officers and directors.	In FY2023/3, the Compensation Committee decided on individual compensation for executive officers and directors as well as performance-linked compensation for executive officers. The Committee also discussed officer compensation levels.	4 times
Audit Committee	Comprising five directors (four of whom are outside directors), this committee audits the execution of duties by executive officers and directors and prepares audit reports. The committee also determines the content of proposals regarding the election and dismissal of accounting auditors and the refusal to reelect accounting auditors to be submitted to general meetings of shareholders.	In FY2023/3, the Audit Committee focused on auditing both internal control system improvements and initiatives to maintain and develop the business. In particular, steps have been taken to prevent internal crimes at post offices by developing comprehensive crime prevention measure and building a system to promote these measures through the JAPAN POST GROUP. Moreover, the Audit Committee has confirmed that steps for improvement continue to be taken.	14 times
Risk Committee (Voluntary Committee)	As an advisory body to the Board of Directors, the Risk Committee comprises three directors (two of whom are outside directors) and two outside experts, who deliberate on important matters related to the status of risk management and provide reports and advice to the Board of Directors.	In FY2023/3, the Risk Committee deliberated on risks related to market operation, ALM and IT systems in light of the Bank’s risk characteristics. In particular, it deliberated on the investment plan and the result of its assessment as well as the preparation status for system updates, and it reported or advised the Board of Directors on important matters from among its discussions.	5 times

	Role
Meetings of Independent Outside Directors	Based on the independent and objective positions of the independent outside directors, the purpose of the Meetings of Independent Outside Directors is to exchange information and share awareness about important matters relating to issues of importance to the management of the Bank and its governance. The Bank also designates all outside directors as independent directors as stipulated by the Tokyo Stock Exchange.

Role

Meetings of Independent Outside Directors

Based on the independent and objective positions of the independent outside directors, the purpose of the Meetings of Independent Outside Directors is to exchange information and share awareness about important matters relating to issues of importance to the management of the Bank and its governance. The Bank also designates all outside directors as independent directors as stipulated by the Tokyo Stock Exchange.

Business Management and Operational Execution

		Role
Executive Committee		The Executive Committee has been established as an advisory body to the President and Representative Executive Officer to hold discussions on important business execution matters.
Internal Control Committee		The Internal Control Committee has been established as an advisory body to the President and Representative Executive Officer to hold discussions on the legal, regulatory and other compliance-related issues as well as other important internal control matters.
Special Committees		The Special Committees assist the Executive Committee in matters requiring specialized discussions.
	Compliance Committee	The Compliance Committee formulates compliance systems and programs and holds discussions and provides reports regarding progress in these matters.
	Risk Management Committee	The Risk Management Committee formulates risk management systems and operational policies. The committee also holds discussions and provides reports regarding progress in risk management matters.
	ALM Committee	The ALM Committee formulates basic ALM plans and operational policies, determines management items, and holds discussions and provides reports regarding progress in these matters.
	Sustainability Committee	The Sustainability Committee formulates action plans with regard to Sustainability and holds discussions and provides reports regarding progress in these matters.
	Information Disclosure Committee	The Information Disclosure Committee formulates basic information disclosure policies, holds discussions, and provides reports on disclosure content and progress in order to ensure the appropriateness and effectiveness of information disclosure.
	Service Improvement Committee	This Service Improvement Committee discusses and reports on the content of the policy relating to customer-oriented business operations, the formulation of plans relating to the improvement of customer-oriented products and services and other important items including the status of implementation.
	Σ Business Strategy Committee	The Σ Business Strategy Committee deliberates and reports on the strategies and plans for new JPB-appropriate wholesale banking business through investment (we call “Σ business”).The Committee also holds discussions and provides reports regarding progress in these matters.

Features of JAPAN POST BANK Corporate Governance (As of July 1, 2023)

[Ratio of outside directors] Outside directors 9/14, Outside directors 64.2% [Ratio of Men to Women] Women 5/14, Women 35.7%

Board of Directors

Skills Matrix

The Board of Directors is comprised of directors with diverse experience and knowledge.

As of July 1, 2023

Name		Experience / expertise									Committee staffing status
Name		Management(Corporate Management)	Legal/Compliance	Financial Accounting	Finance	Market Operation/Risk Management	Sales/Digital Marketing	Human Resources Development	ESG	Administration	Board of Directors	Nomination Committee	Compensation Committee	Audit Committee	Risk Committee(Voluntary committee)
Outside Directors	Keisuke Takeuchi	●							●		●	●	★
	Makoto Kaiwa	●		●					●		●	★
	Risa Aihara	●					●				●		●
	Hiroshi Kawamura		●								●			★
	Kenzo Yamamoto				●	●					●			●	★
	Keiji Nakazawa		●	●							●		●	●
	Atsuko Sato				●	●		●			●				●
	Reiko Amano					●			●		●	●
	Akane Kato	●						●			●			●
Internal Nonexecutive Directors	Hiroya Masuda	●			●				●	●	●	●	●
Internal Nonexecutive Directors	Katsuyo Yamazaki				●			●		●	●			●	●
Internal Directors	Norito Ikeda	●			●		●		●		●	●
	Susumu Tanaka			●	●					●	●
	Takayuki Kasama				●	●					●

External experts	Takao Yajima	Chairman of specified non-profit organization CIO Lounge					●
External experts	Hiromi Yamaoka	Board Director of Future Corporation, Director Group CSO & CLO					●

The ★ mark refers to committee chairperson.

Mr. Norito Ikeda retired from the position of Director, President and Representative Executive Officer of JAPAN POST BANK Co., Ltd. on March 31, 2024 dated.

Reasons for the Nomination as Candidate for Director

Position	Name	Reason
Director	Takayuki Kasama	Mr. Takayuki Kasama successively held various important posts at our Investment Division and others, and has experiences in the management of Japan Post Bank as Senior Managing Executive Officer, and as such Japan Post Bank expects that, with his abundant experience and achievements, he will sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors.
Director	Susumu Tanaka	Mr. Susumu Tanaka successively held various important posts at our Corporate Administration Division and others, and has been responsible for the management of Japan Post Bank as Representative Executive Vice President, and as such Japan Post Bank expects that, with his abundant experience and achievements, he will sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors.
Director	Hiroya Masuda	Mr. Hiroya Masuda successively held various important posts in government administration, including Governor of Iwate Prefecture and Minister for Internal Affairs and Communications, as well as serving as Chairman of the Postal Service Privatization Committee, and has sufficient knowledge about Japan Post Group. In addition, he has been responsible for the management of overall Japan Post Group as Director and Representative Executive Officer, President & CEO of the parent company, JAPAN POST HOLDINGS Co., Ltd., and as such Japan Post Bank expects that, with his abundant experience and achievements, he will sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors.
Director	Katsuyo Yamazaki	Ms. Katsuyo Yamazaki successively held various important posts at JAPAN POST Co., Ltd., and has experience in the management of Japan Post Bank as Managing Executive Officer, and as such Japan Post Bank expects that, with her abundant experience and achievements, she will sufficiently fulfill her role in enhancing the decision making function and supervision function of the Board of Directors.
Outside Director	Keisuke Takeuchi	Mr. Keisuke Takeuchi has been involved in corporate management of a publicly traded company for a long time, and Japan Post Bank expects him to fulfill his role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on his abundant experience and insights as a specialist of corporate management gained through his career.
Outside Director	Makoto Kaiwa	Mr. Makoto Kaiwa has been involved in corporate management of a publicly traded company for a long time, and Japan Post Bank expects him to fulfill his role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on his abundant experience and insights as a specialist of corporate management gained through his career.
Outside Director	Risa Aihara	Ms. Risa Aihara has been involved in corporate management of Internet service businesses for a long time and has deep insights into Internet marketing. As such Japan Post Bank expects that with her abundant experience and insights, she will sufficiently fulfill her role in enhancing the decision making function and supervision function of the Board of Directors.
Outside Director	Hiroshi Kawamura	Mr. Hiroshi Kawamura has been in the legal profession for a long time, and Japan Post Bank expects him to sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on his abundant experience and insights gained through his career as a legal professional.
Outside Director	Kenzo Yamamoto	Mr. Kenzo Yamamoto successively held various important posts at the Bank of Japan, and Japan Post Bank expects him to sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on his abundant experience and insights in the financial market and financial system gained through his career.
Outside Director	Keiji Nakazawa	Mr. Keiji Nakazawa successively held various important posts at publicly traded companies for a long time, and Japan Post Bank expects him to sufficiently fulfill his role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on his abundant experience and insights in finance and accounting gained through his career.
Outside Director	Atsuko Sato	Ms. Atsuko Sato successively held various important posts at Goldman Sachs (Japan) Ltd. and positions as university professor, and Japan Post Bank expects her to sufficiently fulfill her role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on her abundant experience and insights in market operations, risk management and human resource development gained through her career.
Outside Director	Reiko Amano	Ms. Reiko Amano successively held various important posts at publicly traded companies and national research and development agencies for a long time, and Japan Post Bank expects her to sufficiently fulfill her role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on her abundant experience and insights in risk management gained through her career.
Outside Director	Akane Kato	Ms. Akane Kato worked as a human resources development consultant for a long time, and Japan Post Bank expects her to sufficiently fulfill her role in enhancing the decision making function and supervision function of the Board of Directors as an Outside Director, based on her abundant experience and insights in human resources development gained through her career.

Independent Director Appointment Standards

Japan Post Bank shall appoint Independent Directors stipulated by the Tokyo Stock Exchange from Outside Directors who do not fall under any of the following.

Those who have served as an Executive of the Japan Post Group in the past.
Those who have served as a Director who is not an Executive of the parent company of Japan Post Bank in the past.
Entities which hold Japan Post Bank as major client or an Executive thereof, etc.
Entities which are major clients of Japan Post Bank or an Executive thereof, etc.
Consultant, accounting expert or legal expert who acquire, or have acquired substantial money or other property from Japan Post Bank other than officers’ compensation (in case of an organization including corporation, association, etc., those who are, or have been affiliated to such organization in the past)
Major shareholder of Japan Post Bank (in case of a corporation, an Executive thereof, etc.)
Spouse or relative within the second degree of kinship of the following (excluding those without significance).
(1) Those listed in 1 to 6 above
(2) Executive of the Japan Post Group (excluding Japan Post Bank)
(3) Director who is not an Executive of the parent company of Japan Post Bank
Those who execute business in a company in which those who execute business, etc. of Japan Post Bank serve as outside officer.
Those who receive a substantial amount of donation from Japan Post Bank (in case of an organization including corporation, association, etc., those who execute business, etc. thereof, or similar)

Appendix

The definitions of the terms in these Standards are as follows.

Japan Post Group	Japan Post Bank, its parent company, subsidiaries and fellow subsidiaries of the parent company
Executive	An executive stipulated in Article 2, Paragraph 3, Item 6 of the Ordinances for the Enforcement of the Companies

	Act
Executive, etc.	An Executive or those who have been an Executive in the past
Entities which hold Japan Post Bank as major client	An entity which the average annual cash amount paid from Japan Post Bank thereto in the past three fiscal years is over 2% of annual average consolidated total net sales thereof in the past three fiscal years
Entities which are major clients of Japan Post Bank	An entity which the average annual cash amount paid therefrom to Japan Post Bank in the past three fiscal years is over 2% of annual average consolidated ordinary income of Japan Post Bank in the past three fiscal years
Substantial money	Individuals: An average annual cash amount of over ¥10 million in the past three fiscal years Organizations: The average annual cash amount paid from Japan Post Bank to such entity in the past three fiscal years which is over 2% of annual average consolidated total net sales of such entity in the past three fiscal years
Major shareholders	Major shareholders stipulated in Article 163, Paragraph 1 of the Financial Instruments and Exchange Act
Substantial amount of donation	An average annual donation of over ¥10 million in the past three fiscal years

In case transactions or donations relating to the independent directors satisfy the following standards of immateriality, statement on the attribute information of independent directors will be omitted on the judgment that there are no effects on the independence of such independent directors.
(1) Transactions
- 1) The average annual amount paid from Japan Post Bank to such entity in the past three fiscal years is less than 1% of annual average consolidated total net sales of such entity in the past three fiscal years
- 2) The average annual amount paid from such entity to Japan Post Bank in the past three fiscal years is less than 1% of annual average consolidated ordinary income of Japan Post Bank in the past three fiscal years
(2) Donations

An annual average donation from Japan Post Bank is less than ¥5 million in the past three fiscal years

Support System for Outside Directors

The Bank shall take the following actions in relation to directors to ensure the effective and smooth operation of meetings of the Board of Directors and enhance the effectiveness of supervision by outside directors, in particular.

Coordination of an annual schedule with sufficient time available
Timely and appropriate provision of information as necessary
Ensuring sufficient prior explanation and time for prior consideration of the content of agenda items
Ensuring time for questions at Board of Directors’ meetings

In addition, the Bank shall establish the Board of Directors Office and allocate appropriate staff for operational support to effectively and efficiently carry out meetings of the Board of Directors, and for communication and coordination with outside directors.

Providing Opportunities for Outside Directors to Collect Information

To ensure that the expected roles and responsibilities of executives who include outside directors are properly fulfilled, we regularly provide them with opportunities to acquire the necessary knowledge. For example, we provide them with opportunities to deepen their understanding of our business, issues, management strategies, etc., and to acquire the necessary knowledge, such as by conducting inspections of our facilities.

Major lectures given to executives (including outside directors) in FY2023/3

Seminar relating to the General Meeting of Shareholders
Seminar relating to sustainability
Seminar relating to media responses
Seminar relating to cyber security
Project debriefings to analyze business data
Seminar on countering money laundering / the financing of terrorism

In addition, the Bank strives to enhance support for directors. For example, we provide new outside directors with opportunities for individual explanations of the Bank's operations (management plans, market operations, risk management, compliance, etc.) .
Also, the Risk Committee, which invites outside experts as committee members, is open to directors who are not committee members, so that audit committee members and other directors attend the committee.

Succession plan

At JAPAN POST BANK, the Nomination Committee deliberates on succession plans for executives, including the President and Representative Executive Officer, with the aim of achieving sustainable corporate growth and enhancing corporate value over the medium to long term. The Nomination Committee clarifies the ideal image of the President and Representative Executive Officer in terms of values, qualities, and abilities based on JAPAN POST BANK’s vision. The Nomination Committee then establishes objective evaluation criteria and holds discussions based on them, referring to individual and multifaceted evaluations by external organizations. In addition, we are working to develop human resources based on evaluation criteria for the ideal President and Representative Executive Officer in order to facilitate succession planning.

Elections and Dismissals of Executive Officers, Nominations of Director Candidates

With regard to the policies and procedures for electing or dismissing executive officers and nominating director candidates, the Bank has established the "Criteria for Election or Dismissal of Executive Officers" and the "Criteria for Nomination of Director Candidates."

Related Information

Criteria for Election or Dismissal of Executive Officers (PDF/46KB)

Criteria for Nomination of Director Candidates (PDF/51KB)

Policy for Determining Amount or Calculation Method of Compensation, etc., for Directors and Executive Officers

In regard to compensation for the Bank’s directors and executive officers, the Compensation Committee has prescribed the policy for determining the details of individual compensation for directors and executive officers as follows, and it determines the amount of compensation in accordance with this policy.

1. Compensation system

1.When serving concurrently as a director and executive officer, compensation shall be paid for the position of executive officer.

2.Compensation that directors of the Bank receive shall be paid in the form of a fixed amount of compensation corresponding to duties, in light of the scope and scale of responsibility relating to management, and the like.

3.Compensation that executive officers of the Bank receive shall be paid in the form of a base salary (a fixed amount of compensation) and performance-linked stock compensation, and shall function as a sound incentive for sustainable growth.

2. Compensation for directors

Compensation for directors shall be paid as a certain level of a fixed amount of compensation corresponding to duties, in light of the main role of supervision of management, and the level shall be an appropriate one that takes into account the scale of duties as a director and the current situation of the Bank.

3. Compensation for executive officers

Compensation for executive officers shall be paid in the form of a certain level of base salary (a fixed amount of compensation), in light of differences in responsibility that varies according to the job position, and performance-linked stock compensation that reflects the state of achievement of management targets, and the like.
The level of base salary shall be an appropriate one that takes into account the scale of duties of the executive officer and the current situation of the Bank.
In regard to stock compensation, based on the viewpoint of a sound incentive for sustainable growth, points that are calculated by multiplying the sum of basic points corresponding to separately prescribed duties and evaluation points based on individual evaluation by a coefficient that varies according to the state of achievement of management targets shall be granted every year, and shares corresponding to the points accumulated at the time of retirement from office shall be provided. However, a certain percentage of this shall be paid in the form of money obtained by converting the shares into cash.
Furthermore, in the case of a person who is an executive officer in charge of an area that requires special knowledge and skills and, based on the compensation corresponding to his/her duties, would receive a significantly lower level of compensation than what an officer in charge of such an area would generally receive at other companies, it shall be permitted to adopt compensation that refers to the level of compensation at other companies instead of compensation corresponding to duties.

^*1

Evaluation based on the status of achievement of each KPI, etc. set forth in the mid-term management plan (number of accounts registered in the Yucho Bankbook app, number of Tsumitate NISA operation accounts, Regional vitalization fund participation cases, balance of risk assets, RORA (Return on Risk-Weighted Assets), balance of ESG-themed investments, and Ratio of women in managerial positions, etc.)

^*2

Performance-linked stock compensation is calculated by multiplying the points granted based on fiscal 2022 performance by the stock price on the date the points are granted for those who remain in office and by the stock price on the date of retirement for those who retire.　In addition, in the event of serious misconduct or violation by an Executive Officer, the Company has a system that allows for a reduction or forfeiture of the points that form the basis for calculating the shares to be paid to the Executive Officer in question.

^*3

Rounded to the nearest whole number.

Number of persons compensated, compensation, etc., for each officer category (FY2023/3)

(Millions of yen)

Category	Number of persons compensated	Compensation, etc.	Base compensation	Performance-linked stock compensation	Retirement benefit	Other
Category	Number of persons compensated	Compensation, etc.
Directors	12	115	115	–	–	–
Executive Officers	30	746	653	90	–	2
Total	42	862	769	90	–	2

(Notes)

The figures for compensation, etc., are rounded down to the nearest million yen.
If a person holds concurrent positions as Director and Executive Officer, we do not pay compensation for services as Director to such person.
Number of Directors compensated excludes one Director without pay.
Includes compensation paid to two Directors and four Executive Officers who retired during the fiscal year under review and one Executive Officer who resigned at the end of the fiscal year under review.
Performance-linked stock compensation above represents the amount accounted for as expense during the fiscal year ended March 31, 2023.
Although the retirement benefits program to Executive Officers was abolished in June 2013, retirement benefits will be paid upon retirement to Executive Officers who have remained in their positions since then, for their terms of office up to the day of the abolishment of the system.

Related Information

ESG Data: "Compensation for Directors (excluding outside directors)"

ESG Data

ESG-Related Information Index