6-K 1 d6k.htm FORM 6-K Form 6-K
 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 6-K

 

 

Report of Foreign Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

For the month of January, 2008

 

 

MITSUBISHI UFJ FINANCIAL GROUP, INC.

(Translation of registrant’s name into English)

 

 

7-1, Marunouchi 2-chome, Chiyoda-ku

Tokyo 100-8330, Japan

(Address of principal executive offices)

 

 

[Indicate by check mark whether the registrant files or

will file annual reports under cover Form 20-F or Form 40-F.]

Form 20-F      X            Form 40-F              

[Indicate by check mark whether the registrant by furnishing the information

contained in this Form is also thereby furnishing the information to the Commission

pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.]

Yes                      No      X    

 

 


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: January 31, 2008

 

MITSUBISHI UFJ FINANCIAL GROUP, INC.
By:  

/S/ Ryutaro Kusama

Name:   Ryutaro Kusama
Title:   Chief Manager, General Affairs
  Corporate Administration Division


LOGO

Consolidated Financial Information

<consistent with Japanese GAAP>

for the nine months ended December 31, 2007

January 31, 2008

 

Company name:    Mitsubishi UFJ Financial Group, Inc.
   URL http://www.mufg.jp/
Stock exchange listings:    Tokyo, Osaka, Nagoya, New York
Code number:    8306
Representative:    Nobuo Kuroyanagi, President & CEO
For inquiry:    Takeaki Ishii, General Manager of Financial Accounting Office, Financial Planning Division
   TEL (03) 3240-7200

Summary Information

1. Consolidated financial data for the nine months ended December 31, 2007

 

(1) Results of Operations

 

     (Amounts of less than one million yen are rounded down)  
     ( % represents the change from the same period in previous fiscal year)  
     Ordinary Income    Ordinary Profits     Net Income  
     million yen    %    million yen    %     million yen    %  

Nine months ended

                

December 31, 2007

   4,758,387    10.4    665,033    (31.0 )   314,656    (54.4 )

December 31, 2006

   4,308,950    56.3    963,979    30.2     690,550    12.2  

FYE Mar. 31, 2007

   6,094,033       1,457,080      880,997   

 

     Net Income
per Common Share
   Diluted Net Income
per Common Share
     yen    yen

Nine months ended

     

December 31, 2007

   30.01    29.84

December 31, 2006

   68,333.70    67,286.85

FYE Mar. 31, 2007

   86,795.08    86,274.70

Percentages for the nine months ended December 31, 2006 represent the changes from the simple sum of amounts of former Mitsubishi Tokyo Financial Group, Inc. from April 1, 2005 to September 30, 2005 and amounts of Mitsubishi UFJ Financial Group, Inc. from October 1, 2005 to December 31, 2005.

 

(2) Financial Conditions

 

     Total Assets    Total Net Assets    Net Assets Attributable
to MUFG
Shareholders
to Total Assets (*1)
   Total Net Assets
per Common Share
     million yen    million yen    %    yen

As of

           

December 31, 2007

   195,274,038    10,200,599    4.3    770.90

December 31, 2006

   191,355,513    10,090,525    4.2    760,975.97

March 31, 2007

   187,281,022    10,523,700    4.5    801,320.41

 

(*1) “Net assets attributable to MUFG shareholders to total assets” is computed under the formula shown below.

(Total net assets - Subscription rights to shares - Minority interests) / Total assets

(*2) Risk-adjusted Capital Ratio will be disclosed separately in late February 2008.

2. Dividends on Common Stock

 

     Dividends
per Common Share
     yen

Nine months ended

  

December 31, 2006

   —  

December 31, 2007

   —  

3. Earnings forecasts for the fiscal year ending March 31, 2008 (Consolidated)

 

     ( % represents the change from the same period in previous fiscal year)
     Ordinary Income    Ordinary Profits     Net Income     Net Income
per Common Share
     million yen    %    million yen    %     million yen    %     yen

Annual

   6,500,000    6.7    1,150,000    (21.1 )   600,000    (31.9 )   57.45

Unchanged from forecasts announced on November 21, 2007

 

1


Mitsubishi UFJ Financial Group, Inc.

 

4. Other

 

(1) Changes in significant subsidiaries (changes in scope of consolidation involving “Specified Subsidiary” (Tokutei Kogaisya)) during the period:

Newly consolidated: 2 companies (MUFG Capital Finance 6 Limited and BTMU Preferred Capital 6 Limited)

Excluded from consolidation: None

 

(2) Adoption of simplified accounting methods: Adopted

 

(3) There were changes in accounting policies during the period.

Please refer to “4. Other” in Qualitative information and financial statements section on page 4 for detailed information.

(Notes for forecasted information)

The forecast for net income per common share is calculated based on forecasted average number of common shares outstanding for the fiscal year.

 

 

This financial summary report and the accompanying financial highlights contain forward-looking statements regarding estimations, forecasts, targets and plans in relation to the results of operations, financial conditions and other overall management of the company and/or the group as a whole (the “forward-looking statements”). The forward-looking statements are made based upon, among other things, the company’s current estimations, perceptions and evaluations. In addition, in order for the company to adopt such estimations, forecasts, targets and plans regarding future events, certain assumptions have been made. Accordingly, due to various risks and uncertainties, the statements and assumptions are inherently not guarantees of future performance, may be considered differently from alternative perspectives and may result in material differences from the actual result. For the main factors that may effect the current forecasts, please see the Consolidated Summary Report, Annual Securities Report, Disclosure Book, Annual Report, and other current disclosures that the company has announced.

 

 

(Adjustments related to stock split effective on September 30, 2007)

A 1,000 for 1 common stock split became effective on September 30, 2007. Adjusted “per share” information for the fiscal year ended March 31, 2007 and the nine months ended December 31, 2006 prepared on the assumption that the stock split had been effective as of April 1, 2006 is as follows:

 

     Net Income
per Common Share
   Diluted Net Income
per Common Share
     yen    yen

Consolidated

     

Nine months ended December 31, 2006

   68.33    67.29

Fiscal year ended March 31, 2007

   86.80    86.27

 

2


Mitsubishi UFJ Financial Group, Inc.

 

Qualitative Information and Financial Statements

1. Qualitative information related to the consolidated results of operations

Consolidated gross profits (gross profits before credit related costs for trust accounts) for the nine months ended December 31, 2007 was ¥2,559.9 billion, a decrease of ¥127.3 billion compared to the previous nine months ended December 31, 2006. This decrease was mainly due to a decrease of ¥43.8 billion in net fees and commissions and a decrease of ¥137.4 billion in net other business profits, which were partially offset by an increase of ¥6.1 billion in net interest income and an increase of ¥48.8 billion in net trading profits, compared to the previous nine months ended December 31, 2006. General and administrative expenses for the nine months ended December 31, 2007 was ¥1,574.5 billion, an increase of ¥38.5 billion compared to the previous nine months ended December 31, 2006. As a result, net business profits (before credit related costs for trust accounts and provision for general allowance for credit losses) for the nine months ended December 31, 2007 was ¥985.4 billion, a decrease of ¥165.9 billion compared to the previous nine months ended December 31, 2006.

Total credit related costs for the nine months ended December 31, 2007 was ¥334.4 billion, an increase of ¥341.2 billion compared to the previous nine months ended December 31, 2006. Total of net gains (losses) on equity securities for the nine months ended December 31, 2007 was ¥36.9 billion, an increase of ¥19.0 billion compared to the previous nine months ended December 31, 2006. This increase was mainly due to an increase in gains on sales of equity securities. There was also a loss of ¥35.6 billion in other net non-recurring losses in the nine months ended December 31, 2007.

As a result, consolidated ordinary profit for the nine months ended December 31, 2007 was ¥665.0 billion, a decrease of ¥298.9 billion compared to the previous nine months ended December 31, 2006. Net income for the nine months ended December 31, 2007 was ¥314.6 billion, a decrease of ¥375.8 billion compared to the previous nine months ended December 31, 2006. This decrease was mainly due to a decrease in net extraordinary gains of ¥219.2 billion compared to the previous nine months ended December 31, 2006, caused primarily by the decrease in reversal of allowance for credit losses.

2. Qualitative information related to the consolidated financial conditions

Total assets increased by ¥7,993.0 billion from March 31, 2007 to ¥195,274.0 billion at December 31, 2007 (an increase of ¥3,918.5 billion from December 31, 2006), and total net assets decreased by ¥323.1 billion from March 31, 2007 to ¥10,200.5 billion at December 31, 2007 (an increase of ¥110.0 billion from December 31, 2006). The decrease in total net assets was mainly due to a decrease in net unrealized gains on other securities, mainly equity securities, by ¥640.7 billion, which were partially offset by an increase in retained earnings of ¥168.3 billion.

With regards to assets, investment securities decreased by ¥4,589.5 billion from March 31, 2007 to ¥43,618.0 billion at December 31, 2007 (a decrease of ¥5,363.9 billion from December 31, 2006), and loans and bills discounted increased by ¥3,675.5 billion from March 31, 2007 to ¥88,507.4 billion at December 31, 2007 (an increase of ¥1,485.5 billion from December 31, 2006). With regards to liabilities, deposits increased by ¥2,902.0 billion from March 31, 2007 to ¥121,610.7 billion at December 31, 2007 (an increase of ¥5,351.9 billion from December 31, 2006).

3. Qualitative information related to the consolidated earnings forecasts

There are no changes to our earnings forecasts issued on November 21, 2007 for the fiscal year ending March 31, 2008.

 

3


Mitsubishi UFJ Financial Group, Inc.

 

4. Other

 

(1) Changes in significant subsidiaries (changes in scope of consolidation involving “Specified Subsidiary” (Tokutei Kogaisya)) during the period

The following Specified Subsidiaries were newly consolidated during the period.

 

Name

  

Location

   Stated Capital    Primary Business    Ownership  

MUFG Capital Finance 6 Limited

   George Town, Grand Cayman, Cayman Islands    150,000 million yen    Finance    100 %

BTMU Preferred Capital 6 Limited

   George Town, Grand Cayman, Cayman Islands    150,006 million yen    Finance    100
(100)
%
%

Notes:

 

  1. Both of these Specified Subsidiaries are overseas special purpose companies established for issuance of Non-dilutive Preferred Securities.

 

  2. The bracketed number in “Ownership” means MUFG’s indirect ownership share through subsidiaries.

 

(2) Adoption of simplified accounting methods

Allowance for loan losses and some other items are stated partially under simplified accounting methods.

Allowance for loan losses is stated based on the following methods:

For some of the claims to borrowers whose internal credit ratings did not change since the previous semi-annual period-end, allowance is calculated based on the loan loss ratios applied to the borrower in the previous semi-annual period-end settlement.

For some of the claims to borrowers whose internal credit ratings changed since the previous semi-annual period-end, allowance is calculated based on the loan loss ratios used in the previous semi-annual period-end settlement correlated to internal credit ratings of the borrowers as of December 31, 2007.

Some amounts of assets, which are not material, are stated by estimation based on actual amounts as of the previous semi-annual period-end.

 

(3) Changes in accounting policies during the period

(Changes in grouping methods for recognition and measurement of impairment losses for fixed assets)

Upon its merger with DC Card Co., Ltd., Mitsubishi UFJ NICOS Co., Ltd., a consolidated subsidiary of MUFG, changed its grouping method for recognition and measurement of impairment losses for fixed assets. Assets related to credit card business, which used to be grouped as one unit, were allocated into smaller business units which are consistent with the ongoing management and monitoring under the internal managerial accounting. This revision was made as operating systems improved and as a result of business restructurings from aforementioned merger.

This revision caused a 813 million yen increase in ordinary profits and a 4,446 million yen decrease in income before income taxes and others.

 

4


Mitsubishi UFJ Financial Group, Inc.

 

5. Consolidated Financial Statements

(1) Consolidated Balance Sheets

 

(in millions of yen)

   As of
December 31, 2007
(A)
    As of
March 31, 2007
(B)
    Increase (Decrease)
(A) - (B)
    (Reference)
As of December 31,
2006
 

Assets:

        

Cash and due from banks

   11,387,430     8,760,240     2,627,189     9,489,039  

Call loans and bills bought

   712,980     1,897,554     (1,184,574 )   1,463,814  

Receivables under resale agreements

   5,291,527     4,173,178     1,118,349     4,874,350  

Receivables under securities borrowing transactions

   8,033,830     6,700,434     1,333,396     4,566,512  

Commercial paper and other debt purchased

   5,156,371     4,241,859     914,511     3,971,315  

Trading assets

   12,540,410     9,577,974     2,962,435     10,688,568  

Money held in trust

   469,774     368,972     100,802     421,329  

Investment securities

   43,618,045     48,207,623     (4,589,578 )   48,981,969  

Allowance for losses on investment securities

   (33,800 )   (26,150 )   (7,649 )   (21,707 )

Loans and bills discounted

   88,507,468     84,831,949     3,675,518     87,021,954  

Foreign exchanges

   1,560,158     1,353,848     206,309     1,331,265  

Other assets

   5,028,798     4,714,204     314,594     6,038,917  

Tangible fixed assets

   1,714,947     1,697,105     17,842     1,694,358  

Intangible fixed assets

   964,513     741,705     222,808     695,516  

Deferred tax assets

   383,829     259,144     124,684     433,460  

Customers’ liabilities for acceptances and guarantees

   11,183,570     10,966,811     216,758     10,803,737  

Allowance for credit losses

   (1,245,817 )   (1,185,432 )   (60,384 )   (1,098,887 )
                        

Total assets

   195,274,038     187,281,022     7,993,015     191,355,513  
                        

Liabilities:

        

Deposits

   121,610,756     118,708,663     2,902,092     116,258,812  

Negotiable certificates of deposit

   6,768,632     7,083,233     (314,601 )   6,970,849  

Call money and bills sold

   3,886,472     2,546,243     1,340,228     2,868,357  

Payables under repurchase agreements

   10,116,789     8,214,875     1,901,913     9,309,803  

Payables under securities lending transactions

   4,167,610     5,135,235     (967,625 )   5,625,710  

Commercial paper

   509,890     607,902     (98,012 )   603,291  

Trading liabilities

   5,442,904     4,299,018     1,143,886     5,325,653  

Borrowed money

   6,136,258     4,810,735     1,325,523     7,099,360  

Foreign exchanges

   1,274,128     1,001,763     272,364     829,540  

Short-term corporate bonds

   399,300     326,000     73,300     462,600  

Bonds and notes

   6,399,758     6,505,572     (105,813 )   6,568,587  

Bonds with warrants

   —       49,656     (49,656 )   49,673  

Due to trust accounts

   2,173,282     1,542,448     630,834     1,878,555  

Other liabilities

   4,400,263     4,326,742     73,521     6,068,952  

Reserve for employees’ bonuses

   15,958     53,427     (37,469 )   15,871  

Reserve for bonuses to directors and corporate auditors

   160     363     (202 )   173  

Reserve for employees’ retirement benefits

   62,158     66,524     (4,365 )   69,439  

Reserve for retirement benefits to directors and corporate auditors

   1,916     —       1,916     —    

Reserve for contingent losses

   141,682     116,249     25,433     122,802  

Reserve for losses related to business restructuring

   28,397     —       28,397     —    

Reserves under special laws

   4,477     2,316     2,160     2,184  

Deferred tax liabilities

   147,911     187,755     (39,843 )   121,840  

Deferred tax liabilities for land revaluation

   201,158     205,782     (4,623 )   209,191  

Acceptances and guarantees

   11,183,570     10,966,811     216,758     10,803,737  
                        

Total liabilities

   185,073,439     176,757,322     8,316,116     181,264,987  
                        

Net assets:

        

Capital stock

   1,383,052     1,383,052     —       1,383,052  

Capital surplus

   1,865,723     1,916,300     (50,577 )   1,916,306  

Retained earnings

   4,270,589     4,102,199     168,390     3,911,026  

Treasury stock

   (725,760 )   (1,001,470 )   275,710     (1,001,081 )

Total shareholders’ equity

   6,793,604     6,400,081     393,522     6,209,304  

Net unrealized gains (losses) on other securities, net of taxes

   1,414,051     2,054,813     (640,762 )   1,856,745  

Net deferred gains (losses) on hedging instruments, net of taxes

   12,919     (56,429 )   69,348     (75,078 )

Land revaluation excess, net of taxes

   143,628     148,281     (4,653 )   148,492  

Foreign currency translation adjustments

   (40,681 )   (26,483 )   (14,198 )   (29,273 )

Total valuation and translation adjustments

   1,529,918     2,120,183     (590,264 )   1,900,887  

Subscription rights to shares

   2,023     0     2,023     0  

Minority interests

   1,875,052     2,003,434     (128,382 )   1,980,334  
                        

Total net assets

   10,200,599     10,523,700     (323,101 )   10,090,525  
                        

Total liabilities and net assets

   195,274,038     187,281,022     7,993,015     191,355,513  
                        

 

5


Mitsubishi UFJ Financial Group, Inc.

 

(2) Consolidated Statements of Income

 

(in millions of yen)

   For the nine months
ended
December 31, 2007
(A)
   For the nine months
ended
December 31, 2006
(B)
   Increase (Decrease)
(A) - (B)
    (Reference)
For the fiscal year
ended
March 31, 2007

Ordinary income

          

Interest income:

   2,955,376    2,521,091    434,284     3,514,976

(Interest on loans and bills discounted)

   1,760,046    1,564,321    195,724     2,123,825

(Interest and dividends on securities)

   590,819    522,897    67,922     778,295

Trust fees

   112,035    113,120    (1,084 )   152,945

Fees and commissions

   928,435    962,578    (34,143 )   1,330,617

Trading income

   256,792    207,911    48,881     315,042

Other business income

   197,469    255,526    (58,057 )   331,646

Other ordinary income

   308,277    248,720    59,557     448,805
                    

Total ordinary income

   4,758,387    4,308,950    449,436     6,094,033
                    

Ordinary expenses:

          

Interest expenses:

   1,571,182    1,143,460    427,721     1,613,422

(Interest on deposits)

   696,724    524,102    172,621     732,883

Fees and commissions

   132,332    122,648    9,684     171,993

Other business expenses

   188,509    109,139    79,369     136,050

General and administrative expenses

   1,591,750    1,558,900    32,850     2,111,754

Other ordinary expenses

   609,578    410,821    198,757     603,732
                    

Total ordinary expenses

   4,093,353    3,344,970    748,383     4,636,953
                    

Ordinary profits

   665,033    963,979    (298,946 )   1,457,080
                    

Extraordinary gains

   50,858    244,636    (193,778 )   132,123

Extraordinary losses

   83,833    58,377    25,456     80,473
                    

Income before income taxes and others

   632,058    1,150,238    (518,180 )   1,508,730
                    

Income taxes - current

   66,670    87,632    (20,962 )   115,091

Income taxes - deferred

   196,034    301,876    (105,842 )   413,731

Minority interests

   54,696    70,178    (15,481 )   98,910
                    

Net income

   314,656    690,550    (375,894 )   880,997
                    

 

6


Mitsubishi UFJ Financial Group, Inc.

 

(3) Consolidated Statement of Changes in Net Assets

(From April 1, 2007 to December 31, 2007)

 

     (in millions of yen)  
     Shareholders’ equity  
     Capital stock    Capital surplus     Retained earnings     Treasury stock     Total
shareholders’
equity
 

Balances as of March 31, 2007

   1,383,052    1,916,300     4,102,199     (1,001,470 )   6,400,081  

Changes during the period

           

Dividends from retained earnings

        (141,327 )     (141,327 )

Net income

        314,656       314,656  

Acquisition of treasury stock

          (151,722 )   (151,722 )

Disposition of treasury stock

      (50,577 )     427,432     376,855  

Reversal of land revaluation excess, net of taxes

        4,733       4,733  

Changes in accounting standards in overseas consolidated subsidiaries

        (9,672 )     (9,672 )

Net changes in items other than shareholders’ equity

           
                             

Total changes during the period

   —      (50,577 )   168,390     275,710     393,522  
                             

Balances as of December 31, 2007

   1,383,052    1,865,723     4,270,589     (725,760 )   6,793,604  
                             

 

     (in millions of yen)  
     Valuation and translation adjustments     Subscription
rights to
shares
   Minority
interests
    Total net
assets
 
     Net
unrealized
gains
(losses) on
other
securities,
net of taxes
    Net
deferred
gains
(losses) on
hedging
instruments,
net of taxes
    Land
revaluation
excess,

net of taxes
    Foreign
currency
translation
adjustments
    Total valuation
and translation
adjustments
        

Balances as of March 31, 2007

   2,054,813     (56,429 )   148,281     (26,483 )   2,120,183     0    2,003,434     10,523,700  
                                               

Changes during the period

                 

Dividends from retained earnings

                  (141,327 )

Net income

                  314,656  

Acquisition of treasury stock

                  (151,722 )

Disposition of treasury stock

                  376,855  

Reversal of land revaluation excess, net of taxes

                  4,733  

Changes in accounting standards in overseas consolidated subsidiaries

                  (9,672 )

Net changes in items other than shareholders’ equity

   (640,762 )   69,348     (4,653 )   (14,198 )   (590,264 )   2,023    (128,382 )   (716,624 )
                                               

Total changes during the period

   (640,762 )   69,348     (4,653 )   (14,198 )   (590,264 )   2,023    (128,382 )   (323,101 )
                                               

Balances as of December 31, 2007

   1,414,051     12,919     143,628     (40,681 )   1,529,918     2,023    1,875,052     10,200,599  
                                               

 

7


Mitsubishi UFJ Financial Group, Inc.

 

(From April 1, 2006 to December 31, 2006)

 

     (in millions of yen)  
     Shareholders’ equity  
     Capital stock    Capital surplus     Retained earnings     Treasury stock     Total
shareholders’
equity
 

Balances as of March 31, 2006

   1,383,052    1,915,855     3,325,980     (773,941 )   5,850,946  

Changes during the period

           

Dividends from retained earnings

        (103,150 )     (103,150 )

Bonuses to directors and corporate auditors

        (163 )     (163 )

Net income

        690,550       690,550  

Acquisition of treasury stock

          (291,513 )   (291,513 )

Disposition of treasury stock

      456       64,372     64,829  

Reversal of land revaluation excess, net of taxes

        1,100       1,100  

Decrease in consolidated subsidiaries

        (16 )     (16 )

Decrease in companies accounted for under the equity method

        (2,003 )     (2,003 )

Increase in consolidated subsidiaries resulting from changes in accounting standard

        (1,270 )     (1,270 )

Others

      (4 )       (4 )

Net changes in items other than shareholders’ equity

           
                             

Total changes during the period

   —      451     585,046     (227,140 )   358,358  
                             

Balances as of December 31, 2006

   1,383,052    1,916,306     3,911,026     (1,001,081 )   6,209,304  
                             

 

    (in millions of yen)  
    Valuation and translation adjustments   Subscription
rights to
shares
  Minority
interests
    Total net
assets
 
    Net
unrealized
gains
(losses) on
other
securities,
net of taxes
  Net
deferred
gains
(losses) on
hedging
instruments,
net of taxes
    Land
revaluation
excess,
net of taxes
    Foreign
currency
translation
adjustments
    Total valuation
and translation
adjustments
     

Balances as of March 31, 2006

  1,769,525   —       149,534     (42,168 )   1,876,891   0   2,098,512     9,826,349  
                                         

Changes during the period

               

Dividends from retained earnings

                (103,150 )

Bonuses to directors and corporate auditors

                (163 )

Net income

                690,550  

Acquisition of treasury stock

                (291,513 )

Disposition of treasury stock

                64,829  

Reversal of land revaluation excess, net of taxes

                1,100  

Decrease in consolidated subsidiaries

                (16 )

Decrease in companies accounted for under the equity method

                (2,003 )

Increase in consolidated subsidiaries resulting from changes in accounting standard

                (1,270 )

Others

                (4 )

Net changes in items other than shareholders’ equity

  87,220   (75,078 )   (1,041 )   12,895     23,995   —     (118,177 )   (94,181 )
                                         

Total changes during the period

  87,220   (75,078 )   (1,041 )   12,895     23,995   —     (118,177 )   264,176  
                                         

Balances as of December 31, 2006

  1,856,745   (75,078 )   148,492     (29,273 )   1,900,887   0   1,980,334     10,090,525  
                                         

 

8


Mitsubishi UFJ Financial Group, Inc.

 

(Reference)

(From April 1, 2006 to March 31, 2007)

 

     (in millions of yen)  
     Shareholders’ equity  
     Capital stock    Capital surplus     Retained earnings     Treasury stock     Total
shareholders’
equity
 

Balances as of March 31, 2006

   1,383,052    1,915,855     3,325,980     (773,941 )   5,850,946  

Changes during the period

           

Dividends from retained earnings

        (103,150 )     (103,150 )

Bonuses to directors and corporate auditors

        (163 )     (163 )

Net income

        880,997       880,997  

Acquisition of treasury stock

          (292,199 )   (292,199 )

Disposition of treasury stock

      451       64,669     65,121  

Reversal of land revaluation excess, net of taxes

        1,311       1,311  

Decrease in consolidated subsidiaries

        (16 )     (16 )

Decrease in companies accounted for under the equity method

        (2,003 )     (2,003 )

Increase in consolidated subsidiaries resulting from changes in accounting standard

        (1,270 )     (1,270 )

Unrecognized actuarial difference based on accounting standard for retirement benefits in UK

        515       515  

Others

      (6 )       (6 )

Net changes in items other than shareholders’ equity

           
                             

Total changes during the period

   —      445     776,219     (227,529 )   549,135  
                             

Balances as of March 31, 2007

   1,383,052    1,916,300     4,102,199     (1,001,470 )   6,400,081  
                             

 

    (in millions of yen)  
    Valuation and translation adjustments   Subscription
rights to
shares
  Minority
interests
    Total net
assets
 
    Net
unrealized
gains
(losses) on
other
securities,
net of taxes
  Net
deferred
gains
(losses) on
hedging
instruments,
net of taxes
    Land
revaluation
excess,

net of taxes
    Foreign
currency
translation
adjustments
    Total valuation
and translation
adjustments
     

Balances as of March 31, 2006

  1,769,525   —       149,534     (42,168 )   1,876,891   0   2,098,512     9,826,349  
                                         

Changes during the period

               

Dividends from retained earnings

                (103,150 )

Bonuses to directors and corporate auditors

                (163 )

Net income

                880,997  

Acquisition of treasury stock

                (292,199 )

Disposition of treasury stock

                65,121  

Reversal of land revaluation excess, net of taxes

                1,311  

Decrease in consolidated subsidiaries

                (16 )

Decrease in companies accounted for under the equity method

                (2,003 )

Increase in consolidated subsidiaries resulting from changes in accounting standard

                (1,270 )

Unrecognized actuarial difference based on accounting standard for retirement benefits in UK

                515  

Others

                (6 )

Net changes in items other than shareholders’ equity

  285,288   (56,429 )   (1,252 )   15,685     243,292   —     (95,077 )   148,214  
                                         

Total changes during the period

  285,288   (56,429 )   (1,252 )   15,685     243,292   —     (95,077 )   697,350  
                                         

Balances as of March 31, 2007

  2,054,813   (56,429 )   148,281     (26,483 )   2,120,183   0   2,003,434     10,523,700  
                                         

 

9


Mitsubishi UFJ Financial Group, Inc.

 

(4) Statements of Trust Assets and Liabilities

Mitsubishi UFJ Trust and Banking Corporation (Non-consolidated)

Including trust assets under service-shared co-trusteeship

 

(in millions of yen)

   As of
December 31, 2007
(A)
   As of
March 31, 2007
(B)
   Increase
(Decrease)
(A) - (B)
    (Reference)
As of
December 31, 2006

Assets:

          

Loans and bills discounted

   276,232    318,762    (42,530 )   332,324

Securities

   59,125,851    51,797,506    7,328,345     50,777,948

Beneficiary rights to the trust

   27,826,548    24,954,882    2,871,665     25,176,051

Securities held in custody accounts

   1,502,143    1,327,575    174,567     1,426,191

Money claims

   12,350,954    12,639,248    (288,293 )   12,223,635

Tangible fixed assets

   8,459,499    7,810,422    649,077     —  

Intangible fixed assets

   135,283    91,057    44,225     —  

Premises and equipment

   —      —      —       7,269,109

Surface rights

   —      —      —       18,405

Real estate lease rights

   —      —      —       63,114

Other claims

   2,619,206    3,005,010    (385,804 )   2,508,317

Call loans

   1,196,004    1,321,679    (125,675 )   1,276,620

Due from banking account

   2,173,158    1,542,327    630,831     1,878,376

Cash and due from banks

   2,107,979    1,442,039    665,939     1,203,330
                    

Total assets

   117,772,861    106,250,513    11,522,348     104,153,423
                    

Liabilities:

          

Money trusts

   28,519,095    30,086,680    (1,567,584 )   29,017,861

Pension trusts

   14,089,781    13,444,615    645,165     12,780,390

Property formation benefit trusts

   12,535    13,978    (1,443 )   13,784

Loan trusts

   265,812    379,728    (113,915 )   432,844

Investment trusts

   25,912,507    23,220,314    2,692,192     23,537,078

Money entrusted other than money trusts

   3,056,122    2,909,555    146,566     2,971,516

Securities trusts

   1,879,631    1,773,451    106,180     1,913,846

Money claim trusts

   12,917,515    13,099,740    (182,224 )   12,740,560

Equipment trusts

   39,119    42,461    (3,341 )   42,666

Land and fixtures trusts

   106,285    114,487    (8,201 )   115,787

Composite trusts

   30,974,453    21,165,498    9,808,954     20,587,086

Other trusts

   —      —      —       0
                    

Total liabilities

   117,772,861    106,250,513    11,522,348     104,153,423
                    

 

10


Mitsubishi UFJ Financial Group, Inc.

 

(5) Business Segment Information

<For the nine months ended Dcember 31, 2007>

 

     (in millions of yen)
     Banking    Trust
Banking
   Securities    Credit
card
    Other    Total    (Elimination)     Consolidated

Ordinary profits

   547,140    142,114    38,074    (48,648 )   504,890    1,183,570    (518,536 )   665,033

Notes:

 

  1. “Ordinary profits” corresponds to “Operating profits” on the statement of income of companies in non-banking industries.

 

  2. “Other” includes leasing.

 

  3. “Other” includes 502,470 million yen of dividends from MUFG’s domestic consolidated banking subsidiary and domestic consolidated trust banking subsidiary.

 

  4. Changes in grouping methods for recognition and measurement of impairment losses for fixed assets Upon its merger with DC Card Co., Ltd., Mitsubishi UFJ NICOS Co., Ltd., a consolidated subsidiary of MUFG, changed its grouping method for recognition and measurement of impairment losses for fixed assets. Assets related to credit card business, which used to be grouped as one unit, were allocated into smaller business units which are consistent with the ongoing management and monitoring under the internal managerial accounting. This revision was made as operating systems improved and as a result of business restructurings from aforementioned merger.

This revision caused a 813 million yen increase in ordinary profits on “Credit card”.

<For the nine months ended Dcember 31, 2006>

 

     (in millions of yen)
     Banking    Trust
Banking
   Securities    Credit
card
   Other    Total    (Elimination)     Consolidated

Ordinary profits

   710,068    192,713    39,918    80,068    436,624    1,459,392    (495,413 )   963,979

Notes:

 

  1. “Ordinary profits” corresponds to “Operating profits” on the statement of income of companies in non-banking industries.

 

  2. “Other” includes leasing.

 

  3. “Other” includes 488,899 million yen of dividends from MUFG’s domestic consolidated banking subsidiary and domestic consolidated trust banking subsidiary.

(Reference)

<For the fiscal year ended March 31, 2007>

 

     (in millions of yen)
     Banking    Trust
Banking
   Securities    Credit
card
   Other    Total    (Elimination)     Consolidated

Ordinary profits

   1,127,449    273,065    70,522    9,240    384,852    1,865,130    (408,050 )   1,457,080

Notes:

 

  1. “Ordinary profits” corresponds to “Operating profits” on the statement of income of companies in non-banking industries.

 

  2. “Other” includes leasing.

 

  3. “Other” includes 488,899 million yen of dividends from MUFG’s domestic consolidated banking subsidiary and domestic consolidated trust banking subsidiary.

 

11


 

Selected Financial Information

<consistent with Japanese GAAP>

For the nine months ended December 31, 2007

 

 

 

 

 

 

 

 

 

  LOGO  

 

 

Mitsubishi UFJ Financial Group, Inc.


[Contents]

 

I. Financial Highlights for the nine months ended December 31, 2007

   1

II. Summary Report for the nine months ended December 31, 2007

  
   1. Financial Results    [ MUFG Consolidated ] *1    5
      [ BTMU and MUTB Combined ] *2    6
      [ BTMU Non-consolidated ]    7
      [ MUTB Non-consolidated ]    8
  

2. Non-performing Loans Based on the Financial Reconstruction Law

   [ BTMU and MUTB Combined including Trust Accounts ] *3    9
      [ BTMU Non-consolidated : Banking Accounts ]   
      [ MUTB Non-consolidated : Banking Accounts]   
      [ MUTB Non-consolidated : Trust Accounts ]   
  

3. Return on Equity

   [ MUFG Consolidated ]    10
  

4. Average Interest Rate Spread

   [ BTMU and MUTB Combined ]    10
  

5. Fair Value Information on Investment Securities

   [ MUFG Consolidated ]    11
      [ BTMU Non-consolidated ]    12
      [ MUTB Non-consolidated ]    13
  

6. Loans and Deposits

   [ BTMU and MUTB Combined ]    14
  

7. Domestic Deposits

   [ BTMU and MUTB Combined ]    14
  

8. Domestic Consumer Loans

   [ BTMU and MUTB Combined : Banking Accounts]    14
      [ MUTB Non-consolidated : Trust Accounts ]   
  

9. Domestic Loans to Small / Medium-sized Companies and Proprietors

   [ BTMU and MUTB Combined : Banking Accounts]    14
      [ MUTB Non-consolidated : Trust Accounts ]   
  

10. Tax Effects of the Items Comprising Net Deferred Tax Assets

   [ BTMU Non-consolidated ]    15
      [ MUTB Non-consolidated ]   

 

(*1) “MUFG” means Mitsubishi UFJ Financial Group, Inc.
(*2) “BTMU” means The Bank of Tokyo-Mitsubishi UFJ, Ltd.

“MUTB” means Mitsubishi UFJ Trust and Banking Corporation.

(*3) “BTMU and MUTB Combined” means simple sum of “BTMU” and “MUTB” without consolidation processes.


Mitsubishi UFJ Financial Group, Inc.

 

I. Financial Highlights for the nine months ended December 31, 2007

1. Highlights of Consolidated Statements of Income

Consolidated net business profits was ¥985.4 billion, a decrease of ¥165.9 billion compared to the previous nine months ended December 31, 2006. This decrease was mainly due to a decrease in consolidated gross profits by the deterioration in financial market conditions.

Consolidated net income was ¥314.6 billion, a decrease of ¥375.8 billion compared to the previous nine months period. This was mainly due to ¥334.4 billion of total credit related costs in the nine months ended December 31, 2007, and the recording of reconstruction allowance which was accounted for as extraordinary losses in the interim period of fiscal 2007, due to the implementation of structural reforms at Mitsubishi UFJ NICOS Co., Ltd.

LOGO

 

          (in billions of yen )  
          Nine months
ended
December 31, 2007
(A)
    Nine months
ended
December 31, 2006
(B)
    (A) - (B)  
1    Gross profits before credit related costs for trust accounts    2,559.9     2,687.2     (127.3 )
2    General and administrative expenses    1,574.5     1,535.9     38.5  
3    Net business profits before credit related costs for trust accounts and provision for general allowance for credit losses    985.4     1,151.3     (165.9 )
4    Credit related costs*1    (334.4 )   (133.2 )   (201.1 )
5    Total of net gains (losses) on equity securities    36.9     17.9     19.0  
6    Profits (Losses) from investments in affiliates    12.8     (32.6 )   45.4  
7    Other net non-recurring gains (losses)    (35.6 )   (39.3 )   3.6  
                     
8    Ordinary profits    665.0     963.9     (298.9 )
                     
9    Net extraordinary gains    (32.9 )   186.2     (219.2 )
10   

Gains on loans written-off

   31.2     94.7     (63.4 )
11   

Reversal of allowance for credit losses

   —       140.0     (140.0 )
12   

Provision for reserve for losses related to business restructuring

   (62.4 )   —       (62.4 )
13    Total of income taxes-current and income taxes-deferred    262.7     389.5     (126.8 )
14    Minority interests    54.6     70.1     (15.4 )
                     
15    Net income    314.6     690.5     (375.8 )
                     
16    Total credit related costs (negative amount express expenses)*2    (334.4 )   6.7     (341.2 )

 

*1

Credit related costs = Credit related costs(Net non-recurring gains(losses))+Credit related costs for trust accounts +Provision for general allowance for credit losses

*2

Total credit related costs = Credit related costs+Reversal of allowance for credit losses

 

1


Mitsubishi UFJ Financial Group, Inc.

 

2. Highlights of Consolidated Balance Sheets

 

  à Loans and Deposits

Loans and bills discounted (including trust accounts) were ¥88.7 trillion, an increase of ¥1.7 trillion compared to September 30, 2007, due to an increase in both domestic and overseas loans.

Deposits were ¥121.6 trillion, an increase of ¥3.9 trillion compared to September 30, 2007, mainly due to an increase in deposits of domestic (individual) accounts and deposits at overseas offices .

The average interest rate spread (sum of two banks*) between domestic loans and domestic deposits increased to 1.48% in the third quarter (from October 1 to December 31) of fiscal 2007 , from 1.44% in the first half of fiscal 2007.

LOGO

 

  à Non-performing loans (Sum of two banks* )

Non-performing loans ratio was 1.21% representing a decline of 0.07 points compared to September 30, 2007. The progress in the disposal of non-performing loans and upgrades of borrowers’ credit ratings contributed to this decline in non-performing loans ratio.

 

  * Two banks means The Bank of Tokyo-Mitsubishi UFJ, Ltd., and Mitsubishi UFJ Trust and Banking Corporation.

LOGO

 

  à Net unrealized gains (losses) on securities (Total of other securities with market value)

Net unrealized gains (losses) on other securities with market value were ¥2.33 trillion, a decrease of ¥0.64 trillion compared to September 30, 2007. This decrease was due to a decrease in unrealized gains on domestic equity securities.

Net unrealized losses of other securities (Other) which includes sub-prime loan related financial products were ¥0.02 trillion.

LOGO

 

2


Mitsubishi UFJ Financial Group, Inc.

 

 

à

Regarding investments in sub-prime loan related financial products and SIVs(*1) as of end of December 2007.

 

   

MUFG Group’s investments in sub-prime loan related financial products and SIVs are as the table below.

(Management accounting basis, approximate figures, in billions of Japanese Yen.)

 

      End of September
2007
    End of December
2007
    Change  

Sub-prime loan related investments (excluding SIVs)

      

Impairment

   (4.0 )   [        (9.0 (*2)]   (5.0 )

Balance (after impairment)

   259.0     243.0     (16.0 )

Appraisal losses

   (8.0 )   (30.0 )   (22.0 )

Appraisal losses on sub-prime loan related investments (including SIVs)

   (20.0 )    

Appraisal losses on SIVs that holds sub-prime loan related securitized products

   (12.0 )    

 

(*1)

SIV is an abbreviation of Structured Investment Vehicle, which is a collective name for such vehicles investing in securitized products.

(*2)

The impairment amount is the cumulative total from April 2007.

 

      End of September
2007
    End of December
2007
    Change  

Investments in SIVs

      

Losses on sales of SIVs

   —       [        (2.0 )]   (2.0 )

Impairment

   —       [        (44.0 )]   (44.0 )

Balance (after impairment)

   89.0     39.0     (50.0 )

SIVs that invests in sub-prime loan related securitized products

   49.0     13.0     (36.0 )

SIVs that does not invest in sub-prime loan related securitized products

   40.0     26.0     (14.0 )

Appraisal losses

   (18.0 )   (1.0 )   17.0  

SIVs that invests in sub-prime loan related securitized products

   (12.0 )   —       12.0  

SIVs that does not invest in sub-prime loan related securitized products

   (6.0 )   (1.0 )   5.0  

LOGO

 

(*3)

The disclosure of the sub-prime loan related investment balance as of the end of September 2007 includes the balance held by SIVs that directly relates to the holding of the sub-prime loan related investments (JPY 3.0 billion).

(*4)

The disclosure of the appraisal losses of sub-prime loan related investments includes the full amount (JPY 12.0 billion) of appraisal losses of SIVs that holds sub-prime loan related investments.

 

3


Mitsubishi UFJ Financial Group, Inc.

 

   

We recorded a loss of approximately ¥55.0 billion regarding sub-prime loan related investments and SIV investments for the nine months between April and December 2007, mainly due to impairment on our SIV investments. (This comprises of ¥9.0 billion in impairment on sub-prime loan related investments, ¥44.0 billion in impairment on SIV investments, and ¥2.0 billion in losses on the sale of SIVs, which are [            ] above.)

 

   

The balance of sub-prime loan related investments (excluding SIVs) as of end of December 2007 was approximately ¥243.0 billion, a decrease of ¥16.0 billion from end of September, mainly due to redemption. The appraisal losses on such investments as of end of December was approximately ¥30.0 billion, a decrease of ¥22.0 billion from end of September, mainly due to the decline in market prices of our ABS investments. For reference, approximately 96% of our sub-prime loan related investments (excluding SIVs) were rated triple A as of end of December 2007, which is unchanged from end of September.

 

   

The balance of investments in SIVs as of end of December 2007 was approximately ¥39.0 billion, a decrease of ¥50.0 billion from end of September, mainly due to impairment caused by the decline in credit ratings and the worsening of market conditions. The appraisal loss on such investments after impairment was approximately ¥1.0 billion.

 

   

For reference, the balance of sub-prime loan related investments guaranteed by monoline insurers is almost nil as of end of December 2007. Though we hold securitized products such as CLOs that are guaranteed by monoline insurers, nearly all of these are rated triple A without the monoline guarantee. In addition, we do not have any lending or credit derivative transactions with monoline insurers.

 

4


Mitsubishi UFJ Financial Group, Inc.

 

II. Summary Report for the nine months ended December 31, 2007

1. Financial Results

MUFG Consolidated

 

     (in billions of yen)  
     For the nine months
ended

December 31, 2007
(A)
    For the nine months
ended

December 31, 2006
(B)
    Increase (Decrease)
(A) - (B)
 

Gross profits

   2,559.8     2,687.1     (127.3 )

(Gross profits before credit related costs for trust accounts)

   2,559.9     2,687.2     (127.3 )

Net interest income

   1,385.9     1,379.8     6.1  

Trust fees

   112.0     113.1     (1.0 )

Credit related costs for trust accounts (1)

   (0.0 )   (0.0 )   0.0  

Net fees and commissions

   796.1     839.9     (43.8 )

Net trading profits

   256.7     207.9     48.8  

Net other business profits

   8.9     146.3     (137.4 )

Net gains (losses) on debt securities

   (5.3 )   6.2     (11.5 )

General and administrative expenses

   1,574.5     1,535.9     38.5  

Amortization of goodwill

   9.5     6.4     3.1  

Net business profits before provision for general allowance for credit losses, credit related costs for trust accounts and amortization of goodwill

   994.9     1,157.7     (162.7 )

Net business profits before provision for general allowance for credit losses and credit related costs for trust accounts

   985.4     1,151.3     (165.9 )

Provision for general allowance for credit losses (2)

   11.4     —       11.4  

Net business profits*

   996.8     1,151.2     (154.4 )

Net non-recurring gains (losses)

   (331.7 )   (187.2 )   (144.5 )

Credit related costs (3)

   (345.8 )   (133.2 )   (212.6 )

Losses on loan write-offs

   (156.9 )   (121.1 )   (35.7 )

Provision for specific allowance for credit losses

   (170.9 )   —       (170.9 )

Other credit related costs

   (18.0 )   (12.0 )   (6.0 )

Net gains (losses) on equity securities

   36.9     17.9     19.0  

Gains on sales of equity securities

   115.1     54.0     61.0  

Losses on sales of equity securities

   (7.1 )   (1.6 )   (5.5 )

Losses on write down of equity securities

   (71.0 )   (34.5 )   (36.5 )

Profits (losses) from investments in affiliates

   12.8     (32.6 )   45.4  

Other non-recurring gains (losses)

   (35.6 )   (39.3 )   3.6  
                  

Ordinary profits

   665.0     963.9     (298.9 )
                  

Net extraordinary gains (losses)

   (32.9 )   186.2     (219.2 )

Gains on loans written-off

   31.2     94.7     (63.4 )

Reversal of allowance for credit losses (4)

   —       140.0     (140.0 )

Provision for reserve for losses related to business restructuring

   (62.4 )   —       (62.4 )

Income before income taxes and others

   632.0     1,150.2     (518.1 )

Income taxes-current

   66.6     87.6     (20.9 )

Income taxes-deferred

   196.0     301.8     (105.8 )

Minority interests

   54.6     70.1     (15.4 )
                  

Net income

   314.6     690.5     (375.8 )
                  

Note:

      

*       Net business profits = Banking subsidiaries’ net business profits + Other consolidated entities’ gross profits - Other consolidated entities’ general and administrative expenses - Other consolidated entities’ provision for general allowance for credit losses - Amortization of goodwill - Inter-company transactions

           

 

(Reference)

      

Total credit related costs (1)+(2)+(3)+(4)

   (334.4 )   6.7     (341.2 )

 

5


Mitsubishi UFJ Financial Group, Inc.

 

BTMU and MUTB Combined

 

     (in billions of yen)  
     For the nine months
ended

December 31, 2007
(A)
    For the nine months
ended

December 31, 2006
(B)
    Increase (Decrease)
(A) - (B)
 

Gross profits

   1,642.6     1,718.4     (75.8 )

(Gross profits before credit related costs for trust accounts)

   1,642.6     1,718.5     (75.8 )

Net interest income

   1,030.7     998.9     31.7  

Trust fees

   84.1     82.0     2.0  

Credit related costs for trust accounts (1)

   (0.0 )   (0.0 )   0.0  

Net fees and commissions

   371.5     401.3     (29.7 )

Net trading profits

   140.2     104.6     35.5  

Net other business profits

   15.9     131.3     (115.3 )

Net gains (losses) on debt securities

   8.6     6.3     2.2  

General and administrative expenses

   962.1     936.2     25.9  

Net business profits before provision for general allowance for credit losses and credit related costs for trust accounts

   680.5     782.3     (101.8 )

Provision for general allowance for credit losses (2)

   11.1     —       11.1  

Net business profits

   691.6     782.2     (90.5 )

Net non-recurring gains (losses)

   (195.5 )   (118.9 )   (76.5 )

Credit related costs (3)

   (198.5 )   (89.6 )   (108.9 )

Losses on loan write-offs

   (109.3 )   (73.2 )   (36.0 )

Provision for specific allowance for credit losses

   (80.4 )   —       (80.4 )

Other credit related costs

   (8.7 )   (16.3 )   7.6  

Net gains (losses) on equity securities

   10.0     3.3     6.7  

Gains on sales of equity securities

   89.7     42.9     46.7  

Losses on sales of equity securities

   (6.6 )   (1.2 )   (5.4 )

Losses on write down of equity securities

   (72.9 )   (38.3 )   (34.6 )

Other non-recurring gains (losses)

   (7.0 )   (32.6 )   25.5  
                  

Ordinary profits

   496.0     663.2     (167.1 )
                  

Net extraordinary gains (losses)

   41.4     246.1     (204.7 )

Reversal of allowance for credit losses (4)

   —       204.1     (204.1 )

Reversal of reserve for contingent losses included in credit related costs (5)

   0.5     —       0.5  

Income before income taxes

   537.4     909.3     (371.9 )

Income taxes-current

   17.6     13.5     4.0  

Income taxes refund

   9.8     —       9.8  

Income taxes-deferred

   194.0     226.1     (32.0 )
                  

Net income

   335.5     669.7     (334.1 )
                  

(Reference)

      

Total credit related costs (1)+(2)+(3)+(4)+(5)

   (186.7 )   114.4     (301.2 )

 

6


Mitsubishi UFJ Financial Group, Inc.

 

BTMU Non-consolidated

 

     (in billions of yen)  
     For the nine months
ended

December 31, 2007
(A)
    For the nine months
ended

December 31, 2006
(B)
    Increase (Decrease)
(A) - (B)
 

Gross profits

   1,355.4     1,387.9     (32.4 )

Net interest income

   889.4     839.8     49.6  

Net fees and commissions

   285.3     307.7     (22.3 )

Net trading profits

   135.4     91.7     43.6  

Net other business profits

   45.1     148.5     (103.4 )

Net gains (losses) on debt securities

   33.8     17.3     16.5  

General and administrative expenses

   814.1     786.4     27.6  

Net business profits before provision for general allowance for credit losses

   541.2     601.4     (60.1 )

Provision for general allowance for credit losses (1)

   8.7     —       8.7  

Net business profits

   550.0     601.4     (51.4 )

Net non-recurring gains (losses)

   (181.0 )   (123.2 )   (57.7 )

Credit related costs (2)

   (190.6 )   (99.1 )   (91.5 )

Losses on loan write-offs

   (108.1 )   (72.5 )   (35.6 )

Provision for specific allowance for credit losses

   (72.5 )   —       (72.5 )

Other credit related costs

   (9.8 )   (26.5 )   16.6  

Net gains (losses) on equity securities

   18.5     2.6     15.8  

Gains on sales of equity securities

   80.4     34.6     45.7  

Losses on sales of equity securities

   (5.5 )   (0.6 )   (4.8 )

Losses on write down of equity securities

   (56.4 )   (31.3 )   (25.0 )

Other non-recurring gains (losses)

   (8.9 )   (26.8 )   17.8  
                  

Ordinary profits

   368.9     478.1     (109.2 )
                  

Net extraordinary gains (losses)

   38.1     210.0     (171.8 )

Reversal of allowance for credit losses (3)

   —       172.2     (172.2 )

Income before income taxes

   407.1     688.1     (281.0 )

Income taxes-current

   17.8     13.2     4.6  

Income taxes refund

   9.8     —       9.8  

Income taxes-deferred

   136.4     180.5     (44.0 )
                  

Net income

   262.6     494.4     (231.8 )
                  

(Reference)

      

Total credit related costs (1)+(2)+(3)

   (181.8 )   73.1     (255.0 )

 

7


Mitsubishi UFJ Financial Group, Inc.

 

MUTB Non-consolidated

 

     (in billions of yen)  
     For the nine months
ended

December 31, 2007
(A)
    For the nine months
ended

December 31, 2006
(B)
    Increase (Decrease)
(A) - (B)
 

Gross profits

   287.1     330.4     (43.3 )

(Gross profits before credit related costs for trust accounts)

   287.2     330.5     (43.3 )

Net interest income

   141.2     159.1     (17.9 )

Trust fees

   84.1     82.0     2.0  

Credit related costs for trust accounts (1)

   (0.0 )   (0.0 )   0.0  

Net fees and commissions

   86.2     93.6     (7.3 )

Net trading profits

   4.8     12.9     (8.0 )

Net other business profits

   (29.2 )   (17.2 )   (11.9 )

Net gains (losses) on debt securities

   (25.2 )   (10.9 )   (14.2 )

General and administrative expenses

   147.9     149.7     (1.7 )

Net business profits before provision for general allowance for credit losses and credit related costs for trust accounts

   139.2     180.8     (41.6 )

Provision for general allowance for credit losses (2)

   2.4     —       2.4  

Net business profits

   141.6     180.7     (39.1 )

Net non-recurring gains (losses)

   (14.5 )   4.2     (18.8 )

Credit related costs (3)

   (7.9 )   9.4     (17.4 )

Losses on loan write-offs

   (1.1 )   (0.7 )   (0.4 )

Provision for specific allowance for credit losses

   (7.8 )   —       (7.8 )

Other credit related costs

   1.1     10.2     (9.0 )

Net gains (losses) on equity securities

   (8.4 )   0.6     (9.1 )

Gains on sales of equity securities

   9.2     8.2     1.0  

Losses on sales of equity securities

   (1.1 )   (0.5 )   (0.5 )

Losses on write down of equity securities

   (16.5 )   (6.9 )   (9.5 )

Other non-recurring gains (losses)

   1.8     (5.8 )   7.7  
                  

Ordinary profits

   127.1     185.0     (57.9 )
                  

Net extraordinary gains (losses)

   3.2     36.1     (32.8 )

Reversal of allowance for credit losses (4)

   —       31.9     (31.9 )

Reversal of reserve for contingent losses included in credit related costs (5)

   0.5     —       0.5  

Income before income taxes

   130.3     221.1     (90.8 )

Income taxes-current

   (0.1 )   0.3     (0.5 )

Income taxes-deferred

   57.5     45.5     12.0  
                  

Net income

   72.9     175.2     (102.3 )
                  

(Reference)

      

Total credit related costs (1)+(2)+(3)+(4)+(5)

   (4.9 )   41.3     (46.2 )

 

8


Mitsubishi UFJ Financial Group, Inc.

 

2. Non-performing Loans Based on the Financial Reconstruction Law

BTMU and MUTB Combined including Trust Accounts

 

     (in billions of yen)  
     As of
December 31, 2007
    As of
December 31, 2006
    As of
March 31, 2007
(Reference)
 

Bankrupt and de facto bankrupt

   105.4     122.1     115.9  

Doubtful

   706.6     455.2     647.9  

Special attention

   324.3     619.9     562.0  
                  

Total non-performing loans (A)

   1,136.4     1,197.4     1,325.8  
                  

Total loans (B)

   93,298.4     89,682.0     90,594.0  
                  

Non-performing loan ratio (A) / (B)

   1.21 %   1.33 %   1.46 %

 

BTMU Non-consolidated : Banking Accounts

 

      
     (in billions of yen)  
     As of
December 31, 2007
    As of
December 31, 2006
    As of
March 31, 2007
(Reference)
 

Bankrupt and de facto bankrupt

   95.5     111.3     107.3  

Doubtful

   640.0     417.9     575.5  

Special attention

   285.1     514.9     474.3  
                  

Total non-performing loans (A)

   1,020.7     1,044.2     1,157.3  
                  

Total loans (B)

   83,205.0     79,374.4     80,232.3  
                  

Non-performing loan ratio (A) / (B)

   1.22 %   1.31 %   1.44 %

 

MUTB Non-consolidated : Banking Accounts

 

      
     (in billions of yen)  
     As of
December 31, 2007
    As of
December 31, 2006
    As of
March 31, 2007
(Reference)
 

Bankrupt and de facto bankrupt

   9.7     10.6     8.3  

Doubtful

   66.4     37.0     72.1  

Special attention

   38.5     103.9     86.7  
                  

Total non-performing loans (A)

   114.7     151.6     167.2  
                  

Total loans (B)

   9,937.4     10,133.5     10,190.8  
                  

Non-performing loan ratio (A) / (B)

   1.15 %   1.49 %   1.64 %

 

MUTB Non-consolidated : Trust Accounts

 

      
      (in billions of yen)  
      As of
December 31, 2007
    As of
December 31, 2006
    As of
March 31, 2007
(Reference)
 

Bankrupt and de facto bankrupt

   0.1     0.2     0.2  

Doubtful

   0.1     0.3     0.1  

Special attention

   0.6     0.9     0.8  
                  

Total non-performing loans (A)

   0.9     1.4     1.3  
                  

Total loans (B)

   155.9     174.0     170.8  
                  

Non-performing loan ratio (A) / (B)

   0.59 %   0.84 %   0.77 %

Note:

The figures shown above are classified by the claims category under Article 4 of the “Ordinance for Enforcement of the Law concerning Emergency Measures for the Revitalization of Financial Functions”. The results of the self-assessment as of December 31, 2007 and as of December 31, 2006 are reflected in the figures for each relevant date, except with respect to some assets which are not material.

 

9


Mitsubishi UFJ Financial Group, Inc.

 

3. Return on Equity

MUFG Consolidated

 

      (%)
      For the nine months ended
December 31, 2007
   For the fiscal year ended
March 31, 2007
(Reference)

ROE *

   6.55    14.97

Note: * ROE is computed as follows:

[For the nine months ended December 31, 2007]

 

Net income × 4 / 3 - Equivalent of annual dividends on nonconvertible preferred stocks    x 100

{(Total shareholders’ equity at the beginning of the period - Number of nonconvertible preferred shares at the beginning of the period × Issue price + Foreign currency translation adjustments at the beginning of the period) + (Total shareholders’ equity at the end of the period - Number of nonconvertible preferred shares at the end of the period × Issue price + Foreign currency translation adjustments at the end of the period)} / 2

  

[For the fiscal year ended March 31, 2007]

 

Net income - Annual dividends on nonconvertible preferred stocks    x 100

{(Total shareholders’ equity at the beginning of the period - Number of nonconvertible preferred shares at the beginning of the period × Issue price + Foreign currency translation adjustments at the beginning of the period) + (Total shareholders’ equity at the end of the period - Number of nonconvertible preferred shares at the end of the period × Issue price + Foreign currency translation adjustments at the end of the period)} / 2

  

4. Average Interest Rate Spread

BTMU and MUTB Combined

(Domestic business segment)

 

     (%)
      For the nine months ended
December 31, 2007
   For the fiscal year ended
March 31, 2007
(Reference)

Average interest rate on loans and bills discounted

   1.72    1.48

Average interest rate on deposits and NCD

   0.26    0.12

Interest rate spread

   1.45    1.35

 

10


Mitsubishi UFJ Financial Group, Inc.

 

5. Fair Value Information on Investment Securities

MUFG Consolidated

Following tables include:

“Investment securities”, negotiable certificates of deposits in “Cash and due from banks”, beneficiary certificates of commodity investment trusts in “Commercial paper and other debt purchased” and others.

Net unrealized gains (losses) are determined based on the fair values at the end of the fiscal period.

 

     (in billions of yen)
     As of December 31, 2007
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   3,049.0    12.9     16.2    3.2
     (in billions of yen)
     As of December 31, 2007
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   39,336.2    2,330.8     2,950.5    619.7

Domestic equity securities

   6,776.1    2,386.9     2,626.3    239.3

Domestic bonds

   17,367.0    (33.0 )   28.4    61.4

Other

   15,193.0    (23.0 )   295.8    318.9

Foreign equity securities

   280.3    144.5     147.4    2.9

Foreign bonds

   9,295.5    (61.7 )   31.9    93.6

Other

   5,617.0    (105.8 )   116.4    222.2
     (in billions of yen)
     As of December 31, 2006
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   3,299.2    (3.4 )   6.4    9.9
     (in billions of yen)
     As of December 31, 2006
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   43,375.3    3,116.7     3,484.9    368.2

Domestic equity securities

   7,473.0    3,009.9     3,126.9    116.9

Domestic bonds

   22,922.4    (111.0 )   8.8    119.9

Other

   12,979.8    217.8     349.1    131.3

(Reference)

          
     (in billions of yen)
     As of March 31, 2007
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   3,255.8    0.9     9.0    8.1
     (in billions of yen)
     As of March 31, 2007
     Amount on consolidated
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   42,791.3    3,384.2     3,693.2    309.0

Domestic equity securities

   7,661.6    3,221.3     3,322.5    101.2

Domestic bonds

   22,061.9    (70.3 )   17.4    87.7

Other

   13,067.8    233.3     353.3    120.0

 

11


Mitsubishi UFJ Financial Group, Inc.

 

BTMU Non-consolidated

Following tables include:

“Investment securities”, negotiable certificates of deposits in “Cash and due from banks”, beneficiary certificates of commodity investment trusts in “Commercial paper and other debt purchased” and others.

Net unrealized gains (losses) are determined based on the fair values at the end of the fiscal period.

 

     (in billions of yen)
     As of December 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   1,995.7    (0.5 )   0.4    0.9

Stocks of subsidiaries and affiliates

   560.1    294.8     338.3    43.4
     (in billions of yen)
     As of December 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   31,501.9    1,591.7     2,102.9    511.2

Domestic equity securities

   5,367.2    1,599.9     1,816.5    216.6

Domestic bonds

   14,579.3    (43.8 )   16.1    60.0

Other

   11,555.3    35.6     270.1    234.5
     (in billions of yen)
     As of December 31, 2006
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   2,359.4    (7.2 )   0.0    7.2

Stocks of subsidiaries and affiliates

   501.5    628.3     631.3    2.9
     (in billions of yen)
     As of December 31, 2006
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   35,624.8    2,168.4     2,478.1    309.6

Domestic equity securities

   5,925.6    2,052.1     2,165.0    112.8

Domestic bonds

   20,097.4    (106.0 )   5.2    111.3

Other

   9,601.7    222.3     307.7    85.4
(Reference)           
     (in billions of yen)
     As of March 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   2,249.6    (5.8 )   0.0    5.8

Stocks of subsidiaries and affiliates

   501.5    622.5     623.4    0.8
     (in billions of yen)
     As of March 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   35,160.5    2,383.9     2,648.1    264.2

Domestic equity securities

   6,090.2    2,230.8     2,330.7    99.9

Domestic bonds

   19,398.7    (76.8 )   9.0    85.8

Other

   9,671.6    229.9     308.3    78.4

 

12


Mitsubishi UFJ Financial Group, Inc.

 

MUTB Non-consolidated

Following tables include:

“Investment securities”, Beneficiary certificates of commodity investment trusts in “Commercial paper and other debt purchased” and others.

Net unrealized gains (losses) are determined based on the fair values at the end of the fiscal period.

 

     (in billions of yen)
     As of December 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   912.8    14.2     14.2    —  

Stocks of subsidiaries and affiliates

   6.4    (0.5 )   —      0.5
     (in billions of yen)
     As of December 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   5,974.2    445.6     531.8    86.1

Domestic equity securities

   1,304.3    468.0     503.1    35.1

Domestic bonds

   2,343.9    9.7     10.3    0.6

Other

   2,325.9    (32.0 )   18.3    50.3
     (in billions of yen)
     As of December 31, 2006
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   812.7    5.2     5.2    0.0

Stocks of subsidiaries and affiliates

   —      —       —      —  
     (in billions of yen)
     As of December 31, 2006
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   5,921.3    612.1     650.2    38.1

Domestic equity securities

   1,452.3    593.0     616.0    22.9

Domestic bonds

   2,416.0    (0.9 )   3.7    4.6

Other

   2,052.8    20.0     30.5    10.5
(Reference)           
     (in billions of yen)
     As of March 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Debt securities being held to maturity

   875.6    7.7     7.7    0.0

Stocks of subsidiaries and affiliates

   1.9    (0.0 )   —      0.0
     (in billions of yen)
     As of March 31, 2007
     Amount on
balance sheet
   Net unrealized
gains (losses)
    Unrealized gains    Unrealized losses

Other securities

   5,818.4    686.2     710.8    24.5

Domestic equity securities

   1,510.7    651.8     667.9    16.1

Domestic bonds

   2,272.7    7.5     8.0    0.5

Other

   2,034.9    26.8     34.8    7.9

 

13


Mitsubishi UFJ Financial Group, Inc.

 

6. Loans and Deposits

BTMU and MUTB Combined

 

     (in billions of yen)
     As of
December 31,

2007
   As of
December 31,

2006
   As of
March 31, 2007
(Reference)

Deposits (ending balance)

   114,713.3    109,885.4    112,041.3

Deposits (average balance)

   111,255.2    110,124.4    110,056.1

Loans (ending balance)

   80,350.3    80,639.5    78,085.4

Loans (average balance)

   78,078.5    79,923.1    79,633.7

7. Domestic Deposits

BTMU and MUTB Combined

 

     (in billions of yen)
     As of
December 31,

2007
   As of
December 31,

2006
   As of
March 31, 2007
(Reference)

Individuals

   62,884.2    61,112.0    60,858.3

Corporations and others

   37,958.0    38,275.6    40,840.2

Domestic deposits

   100,842.3    99,387.6    101,698.5

Note: Amounts do not include negotiable certificates of deposit and JOM accounts.

8. Domestic Consumer Loans

BTMU and MUTB Combined : Banking Accounts

 

     (in billions of yen)
     As of
December 31,

2007
   As of
December 31,

2006
   As of
March 31, 2007
(Reference)

Total domestic consumer loans

   17,977.7    18,450.7    18,236.2

Housing loans

   16,965.6    17,268.0    17,098.6

Others

   1,012.1    1,182.7    1,137.6

MUTB Non-consolidated : Trust Accounts

 

     (in billions of yen)
     As of
December 31,
2007
   As of
December 31,
2006
   As of
March 31, 2007
(Reference)

Total domestic consumer loans

   86.8    94.1    92.7

Housing loans

   85.8    92.8    91.5

Others

   0.9    1.2    1.1

9. Domestic Loans to Small / Medium-sized Companies and Proprietors

BTMU and MUTB Combined : Banking Accounts

 

     (in billions of yen)  
     As of
December 31,
2007
    As of
December 31,
2006
    As of
March 31, 2007
(Reference)
 

Domestic loans to small / medium-sized companies and Proprietors

   43,500.9     44,243.6     43,804.9  

Percentage to total domestic loans

   64.17 %   62.61 %   64.46 %

MUTB Non-consolidated : Trust Accounts

 

     (in billions of yen)  
     As of
December 31,
2007
    As of
December 31,
2006
    As of
March 31, 2007
(Reference)
 

Domestic loans to small / medium-sized companies and Proprietors

   236.6     272.6     272.2  

Percentage to total domestic loans

   85.65 %   82.03 %   85.40 %

 

14


Mitsubishi UFJ Financial Group, Inc.

 

10. Tax Effects of the Items Comprising Net Deferred Tax Assets

BTMU Non-consolidated

 

     (in billions of yen)  
     As of December 31, 2007     Changes from March 31, 2007  

Deferred tax assets

   1,294.9     (194.1 )

Net operating losses carried forwards

   753.4     (151.7 )

Allowance for credit losses

   433.3     3.8  

Write-down on investment securities

   208.9     (10.3 )

Reserve for employees’ retirement benefits

   80.7     (8.8 )

Other

   429.6     (21.4 )

Valuation allowance

   (611.1 )   (5.6 )

Deferred tax liabilities

   980.1     (314.0 )

Unrealized gains on other securities

   721.7     (275.0 )

Revaluation gaines on securities upon merger

   169.1     (44.2 )

Other

   89.2     5.3  

Net deferred tax assets

   314.8     119.8  

MUTB Non-consolidated

 

     (in billions of yen)  
     As of December 31, 2007     Changes from March 31, 2007  

Deferred tax assets

   160.2     (55.4 )

Net operating losses carried forwards

   102.7     (53.9 )

Write-down on investment securities

   78.5     3.7  

Allowance for credit losses

   41.1     0.5  

Other

   48.8     7.8  

Valuation allowance

   (111.0 )   (13.6 )

Deferred tax liabilities

   219.8     (88.0 )

Unrealized gains on other securities

   188.6     (90.3 )

Other

   31.2     2.2  

Net deferred tax assets

   (59.6 )   32.6  

 

15