JAPAN POST BANK Priority Issues

Positioning of Priority Issues (Materiality) in Management
Priority Issues (Materiality)

Positioning of Priority Issues (Materiality) in Management

Japan Post Bank is engaging in the advancement of Sustainability management, which combines both corporate value enhancement and the solving of social issues. At the basis of this is a "cycle of value creation" – an approach that involves working to solve social issues and provide value to our various stakeholders through our business activities, which in turn is linked to the enhancement of our corporate value.

Related Information

Management Strategy

Priority Issues (Materiality)

Japan Post Bank has established its materiality (priority issues) in line with the launch of its new medium-term management plan, effective from 2026. These issues have been identified based on what we, as a "chosen bank that continues to grow with society," should prioritize in delivering value to stakeholders such as customers, regional communities, the environment, and our employees. By returning to the fundamentals of our business and clearly defining these priority issues, we can reinforce our commitment to growing in harmony with society, while empowering our employees to work toward this goal. Furthermore, for each of these priority issues, we have established KPIs to monitor our progress. Going forward, Japan Post Bank will continue to advance sustainable management while conducting regular reviews of these priorities.

Relevance to Materiality

For each of the four materiality issues, we are working to minimize risks and maximize opportunities by sorting out risks and opportunities.
Additionally, we will advance human capital management, corporate culture reforms, and the enhancement of our management base as critical foundations essential to addressing our materiality.

Priority Issues (Materiality)	Basic Approach	Risks	Opportunities	Specific initiatives	KPIs
Provide side-by-side, lifelong support in an era of 100-year lifespans	Through collaboration with partner companies, we provide products and services tailored to the diverse needs of customers, offering side-by-side support for a fulfilling life that may span 100 years in a super-aging society.	Customer attrition due to an inadequate response to the growing demand for asset formation Outflow of deposits due to inheritance	Strengthen the customer base by earning customer trust Expand assets under management by appropriately addressing customers' asset-building needs	Promote the use of long-term asset formation schemes , etc.	Number of long-term asset formation program users： 1.1mn
Ensure access to quality financial services	Through three physical, digital, and remote channels, we provide customers across Japan with "safe, secure, and easy-to-use" + "beneficial" financial services, and strive to ensure financial access for all.	Customer attrition due to deterioration in the safety and reliability of financial services Contraction of the customer base due to regional characteristics and differences in digital literacy	Strengthen the customer base by providing services to a broad range of customers Increase opportunities to use the bank's services through the provision of highly convenient services	Promote the use of the Yucho Bankbook App, etc.	Number of accounts registered for the Yucho Bankbook App: 25.0mn
Co-create value with local communities	To support vibrant local communities, we work with regional financial institutions and others to promote funds flow to regional communities and expand services.	Decline in assets under custody due to regional population decline Reduction in investment opportunities due to the contraction of the regional economy	Securing the customer base and expanding revenue opportunities through collaboration with regional financial institutions and other partners Expansion of investment initiatives through the identification of regional opportunities	Execute investments by our subsidiary and GPs, etc.	Investments executed through subsidiary General Partner: Approx. 60deals executed, totaling approx.¥60.0bn
Investments and financing for a sustainable environment and society	As one of Japan's largest institutional investors, we contribute to realizing a sustainable environment and society through our investment and lending activities, including the steady expansion of our sustainable finance track record.	Damage to the Group's assets, including ATMs, due to natural disasters, along with increased credit risk among investee companies Decline in the value of securities held for investment purposes, particularly those issued by companies significantly impacted by tightening environmental regulations Deterioration in corporate value if the Group is perceived as inadequately addressing environmental issues	Enhancement of the Group's reputation in capital markets and society through appropriate environmental initiatives and disclosures Increase in lending and investment in renewable energy projects, along with expanded investment opportunities in green bonds and other instruments	Steadily promote sustainable finance, etc.	Net interest income, etc.: Over¥2.3tn Sustainable finance: Approx.¥10tn* *As of March 31, 2031

The Process of Identifying Materiality

Step 1: Initial identification⇒Long list⇒Short list
After defining stakeholders and the value chain, we examined long-term external environmental changes (megatrends) surrounding society and the environment and conducted an analysis of both internal and external conditions. Based on this analysis, we identified issues and topics that would serve as the basis for candidate materiality topics and selected 22 items.

Step 2: Interviews with Head Office Departments and Impact Mapping
For the 22 topics, risks and opportunities on the horizontal axis were assessed based on "impact" and "probability" in accordance with the Bank's risk appetite framework. Meanwhile, impact on the vertical axis was evaluated from the perspectives of "scale," "scope," "difficulty of remediation" (for negative impacts only), and "likelihood of occurrence," with reference to guidance published by the European Financial Reporting Advisory Group (EFRAG). Furthermore, we conducted interviews with the heads of relevant head office departments closely associated with the candidate materiality topics and subsequently performed a re-evaluation.

Step 2: Interviews with Head Office Departments and Impact Mapping

For the 22 topics, risks and opportunities on the horizontal axis were assessed based on "impact" and "probability" in accordance with the Bank's risk appetite framework. Meanwhile, impact on the vertical axis was evaluated from the perspectives of "scale," "scope," "difficulty of remediation" (for negative impacts only), and "likelihood of occurrence," with reference to guidance published by the European Financial Reporting Advisory Group (EFRAG). Furthermore, we conducted interviews with the heads of relevant head office departments closely associated with the candidate materiality topics and subsequently performed a re-evaluation.

Step 3: Directional Discussion and Issue Prioritization
From the dual perspectives of the 22 topics and the Bank’s existing initiatives, similar issues were broadly consolidated into seven categories. Corporate governance, which underpins management and serves as the source of all issues, was not identified as a materiality topic. Instead, it was positioned as the foundation supporting both the materiality topics and their associated strategies (the Medium-Term Management Plan).

Step 3: Directional Discussion and Issue Prioritization

From the dual perspectives of the 22 topics and the Bank’s existing initiatives, similar issues were broadly consolidated into seven categories. Corporate governance, which underpins management and serves as the source of all issues, was not identified as a materiality topic. Instead, it was positioned as the foundation supporting both the materiality topics and their associated strategies (the Medium-Term Management Plan).

Step 4: Identifying Priority Issues (Materiality)
The Management Committee and the Board of Directors review the appropriateness and identify four materiality issues. The Management Committee and the Board of Directors confirm the status of progress at their meetings once a quarter. The materiality issues will be reviewed periodically—at least once every two to three years—taking into account changes in the social environment and the Bank’s initiatives. The identification, evaluation, review, etc. of materiality issues will be decided by the Board of Directors upon discussion.

Step 4: Identifying Priority Issues (Materiality)

The Management Committee and the Board of Directors review the appropriateness and identify four materiality issues. The Management Committee and the Board of Directors confirm the status of progress at their meetings once a quarter.
The materiality issues will be reviewed periodically—at least once every two to three years—taking into account changes in the social environment and the Bank’s initiatives. The identification, evaluation, review, etc. of materiality issues will be decided by the Board of Directors upon discussion.