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6-K 1 d300202d6k.htm FORM 6-K FORM 6-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER

PURSUANT TO RULE 13a-16 OR 15d-16 OF THE

SECURITIES EXCHANGE ACT OF 1934

For the month of February 2022

Commission file number 001-34919

SUMITOMO MITSUI FINANCIAL GROUP, INC.

(Translation of registrant’s name into English)

1-2, Marunouchi 1-chome, Chiyoda-ku, Tokyo 100-0005, Japan

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F:

Form 20-F ☒ or Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes ☐ No ☒

*	If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE INTO THE PROSPECTUS FORMING A PART OF SUMITOMO MITSUI FINANCIAL GROUP, INC.’S REGISTRATION STATEMENT ON FORM F-3 (FILE NO. 333-261754) AND TO BE A PART OF SUCH PROSPECTUS FROM THE DATE ON WHICH THIS REPORT IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED OR FURNISHED.

TABLE OF DOCUMENT(S) SUBMITTED

1.	Unaudited quarterly consolidated Japanese GAAP financial statements as of and for the nine months ended December 31, 2021

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.


Sumitomo Mitsui Financial Group, Inc.

By:	/s/ Toru Nakashima
	Name:	Toru Nakashima
	Title:	Senior Managing Executive Officer Group Chief Financial Officer

Date: February 18, 2022

UNAUDITED QUARTERLY CONSOLIDATED JAPANESE GAAP FINANCIAL STATEMENTS

AS OF AND FOR THE NINE MONTHS ENDED DECEMBER 31, 2021

On February 14, 2022, we published our unaudited quarterly consolidated financial statements as of and for the nine months ended December 31, 2021 prepared in accordance with accounting principles generally accepted in Japan, or Japanese GAAP, as part of our quarterly securities report (shihanki hokokusho) for the quarter ended December 31, 2021 filed by us with the relevant Japanese authorities. This document is an English translation of the unaudited quarterly consolidated financial statements and the notes thereto included in such quarterly securities report. Japanese GAAP differs in certain respects from International Financial Reporting Standards as issued by the International Accounting Standards Board, or IFRS, and generally accepted accounting principles in the United States. For a description of certain differences between IFRS and Japanese GAAP, see “Item 5.A Operating Results—Reconciliation with Japanese GAAP” in our most recent annual report on Form 20-F filed with the SEC.

UNAUDITED QUARTERLY

CONSOLIDATED FINANCIAL STATEMENTS (JAPANESE GAAP)

QUARTERLY CONSOLIDATED BALANCE SHEETS


	Millions of yen						Millions of U.S. dollars
	March 31, 2021			December 31, 2021			December 31, 2021
Assets:
Cash and due from banks		¥	72,568,875		¥	73,199,223	$	636,460
Call loans and bills bought			2,553,463			4,732,709		41,150
Receivables under resale agreements			5,565,119			5,246,295		45,616
Receivables under securities borrowing transactions			5,827,448			5,132,038		44,623
Monetary claims bought			4,665,244			5,298,362		46,069
Trading assets			6,609,195			7,408,750		64,418
Money held in trust			309			310		3
Securities	*2		36,549,043	*2		36,450,576		316,934
Loans and bills discounted	*1		85,132,738	*1		88,014,485		765,277
Foreign exchanges			2,173,189			3,196,130		27,790
Lease receivables and investment assets			236,392			229,075		1,992
Other assets			8,590,785			8,608,481		74,850
Tangible fixed assets			1,458,991			1,483,064		12,895
Intangible fixed assets			738,759			934,002		8,121
Net defined benefit asset			565,534			591,511		5,143
Deferred tax assets			29,840			45,387		395
Customers’ liabilities for acceptances and guarantees			9,978,396			10,843,754		94,285
Reserve for possible loan losses			(659,017)			(765,998)		(6,660)

Total assets		¥	242,584,308		¥	250,648,163	$	2,179,360

—1—

QUARTERLY CONSOLIDATED BALANCE SHEETS


	Millions of yen						Millions of U.S. dollars
	March 31, 2021			December 31, 2021			December 31, 2021
Liabilities and net assets:
Liabilities:
Deposits		¥	142,026,156		¥	146,414,241	$	1,273,057
Negotiable certificates of deposit			12,570,617			12,724,386		110,637
Call money and bills sold			1,368,515			827,534		7,195
Payables under repurchase agreements			15,921,103			17,220,652		149,732
Payables under securities lending transactions			2,421,353			1,073,187		9,331
Commercial paper			1,686,404			2,350,773		20,440
Trading liabilities			5,357,649			4,999,602		43,471
Borrowed money			17,679,690			18,735,444		162,903
Foreign exchanges			1,113,037			1,362,928		11,851
Short-term bonds			585,000			374,000		3,252
Bonds			9,043,031			9,581,058		83,306
Due to trust account			2,321,223			2,333,682		20,291
Other liabilities			7,741,638			8,668,763		75,374
Reserve for employee bonuses			89,522			54,351		473
Reserve for executive bonuses			4,408			—		—
Net defined benefit liability			35,334			42,546		370
Reserve for executive retirement benefits			1,081			1,046		9
Reserve for point service program			24,655			24,565		214
Reserve for reimbursement of deposits			9,982			6,448		56
Reserve for losses on interest repayment			140,758			113,038		983
Reserves under the special laws			3,902			3,990		35
Deferred tax liabilities			532,193			541,157		4,705
Deferred tax liabilities for land revaluation			29,603			29,298		255
Acceptances and guarantees			9,978,396			10,843,754		94,285

Total liabilities			230,685,262			238,326,456		2,072,224

Net assets:
Capital stock			2,341,274			2,341,878		20,362
Capital surplus			693,205			693,709		6,032
Retained earnings			6,492,586			6,834,716		59,427
Treasury stock			(13,698)			(13,424)		(117)

Total stockholders’ equity			9,513,367			9,856,880		85,705

Net unrealized gains (losses) on other securities			2,094,605			2,050,217		17,826
Net deferred gains (losses) on hedges			14,723			(52,821)		(459)
Land revaluation excess			36,251			36,254		315
Foreign currency translation adjustments			40,390			230,666		2,006
Accumulated remeasurements of defined benefit plans			127,080			108,214		941

Total accumulated other comprehensive income			2,313,051			2,372,531		20,629

Stock acquisition rights			1,791			1,498		13
Non-controlling interests			70,836			90,796		789

Total net assets			11,899,046			12,321,706		107,136

Total liabilities and net assets		¥	242,584,308		¥	250,648,163	$	2,179,360

—2—

QUARTERLY CONSOLIDATED STATEMENTS OF INCOME


	Millions of yen								Millions of U.S. dollars
Nine months ended December 31	2020				2021				2021
Ordinary income			¥	2,894,820			¥	2,995,751	$	26,048
Interest income				1,369,224				1,357,126		11,800
Interest on loans and discounts				1,019,011				980,481		8,525
Interest and dividends on securities				196,888				243,704		2,119
Trust fees				3,385				4,011		35
Fees and commissions				947,126				1,038,336		9,028
Trading income				195,689				157,223		1,367
Other operating income				234,697				201,255		1,750
Other income		*1		144,698		*1		237,797		2,068
Ordinary expenses				2,299,939				2,128,378		18,506
Interest expenses				412,803				266,984		2,321
Interest on deposits				120,076				61,672		536
Fees and commissions payments				156,336				168,795		1,468
Trading losses				—				132		1
Other operating expenses				110,596				139,988		1,217
General and administrative expenses				1,279,352				1,330,490		11,568
Other expenses		*2		340,851		*2		221,986		1,930

Ordinary profit				594,881				867,373		7,542

Extraordinary gains		*3		824		*3		1,531		13
Extraordinary losses		*4		8,633		*4		6,752		59

Income before income taxes				587,071				862,152		7,496

Income taxes				151,654				232,354		2,020

Profit				435,417				629,798		5,476

Profit attributable to non-controlling interests				1,487				5,003		44

Profit attributable to owners of parent			¥	433,929			¥	624,795	$	5,433

—3—

QUARTERLY CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME


	Millions of yen						Millions of U.S. dollars
Nine months ended December 31	2020			2021			2021
Profit		¥	435,417		¥	629,798	$	5,476
Other comprehensive income (losses)			644,783			57,989		504
Net unrealized gains (losses) on other securities			641,402			(44,753)		(389)
Net deferred gains (losses) on hedges			(5,587)			(71,155)		(619)
Foreign currency translation adjustments			(91,191)			166,658		1,449
Remeasurements of defined benefit plans			92,798			(19,492)		(169)
Share of other comprehensive income of affiliates			7,360			26,733		232

Total comprehensive income			1,080,200			687,788		5,980

Comprehensive income attributable to owners of parent			1,077,620			684,272		5,950
Comprehensive income attributable to non-controlling interests			2,580			3,515		31

—4—

NOTES TO UNAUDITED QUARTERLY CONSOLIDATED FINANCIAL STATEMENTS

(Basis of presentation)

Sumitomo Mitsui Financial Group, Inc. (“the Company”) was established on December 2, 2002 as a holding company for the SMBC Group (“the Group”) through a statutory share transfer (kabushiki iten) of all of the outstanding equity securities of Sumitomo Mitsui Banking Corporation (“SMBC”) in exchange for the Company’s newly issued securities. The Company is a joint stock corporation with limited liability (Kabushiki Kaisha) incorporated under the Companies Act of Japan. Upon formation of the Company and completion of the statutory share transfer, SMBC became a direct wholly owned subsidiary of the Company.

The Company has prepared the accompanying consolidated financial statements in accordance with the provisions set forth in the Japanese Financial Instruments and Exchange Act and its related accounting regulations, and in conformity with accounting principles generally accepted in Japan (“Japanese GAAP”), which are different in certain respects as to application and disclosure requirements from International Financial Reporting Standards (“IFRS”).

The accounts of overseas subsidiaries and affiliated companies are, in principle, integrated with those of the Company’s accounting policies for purposes of consolidation unless they apply different accounting principles and standards as required under U.S. GAAP or IFRS, in which case a certain limited number of items are adjusted based on their materiality.

These consolidated financial statements are translated from the consolidated financial statements contained in the quarterly securities report filed under the Financial Instruments and Exchange Act of Japan (“FIEA based financial statements”) except for the addition of U.S. dollar figures.

Amounts less than 1 million yen have been rounded down. As a result, the totals in Japanese yen shown in the financial statements do not necessarily agree with the sum of the individual amounts.

The translation of the Japanese yen amounts into U.S. dollars is included solely for the convenience of readers outside Japan, using the prevailing exchange rate at December 31, 2021 which was ¥115.01 to US$1. These translations should not be construed as representations that the Japanese yen amounts have been, could have been, or could in the future be, converted into U.S. dollars at that rate.

—5—

(Changes in the scope of consolidation or in the scope of equity method)

(1)

Significant changes in the scope of consolidation

Fullerton India Credit Company Limited was included in the scope of consolidation from the nine months ended December 31, 2021 because of acquisition of stock.

(2)

Significant changes in the scope of equity method

VPBank Finance Company Limited was included in the scope of equity method from the nine months ended December 31, 2021 because of acquisition of stock.

VPBank Finance Company Limited changed the name to VPBank SMBC Finance Company Limited.

(Changes in accounting policies)

Application of Accounting Standard for Revenue Recognition etc.

The Company applied “Accounting Standard for Revenue Recognition” (ASBJ Statement No.29, March 31, 2020) etc. from the beginning of the period for the three months ended June 30, 2021, and has recognized revenue in an amount expected to be earned in exchange for goods or services at the time when controls of the promised goods or services are transferred to customers.

As for the application of Accounting standards for Revenue Recognition etc., in accordance with transitional treatment stipulated in the proviso of Paragraph 84 of “Accounting Standard for Revenue Recognition,” the cumulative effects by the retroactive application of the new accounting policy previous to the beginning of the period for the three months ended June 30, 2021 are adjusted to “Retained earnings” of the beginning of the period for the nine months ended December 31, 2021.

As a result, “Retained earnings” decreased by ¥8,502 million at the beginning of the period for the nine months ended December 31, 2021.

In accordance with the transitional measures set forth in paragraph 28-15 of “Accounting Standard for Quarterly Financial Reporting” (ASBJ Statement No.12, March 31, 2020), information on breakdown of revenues from contracts with customers for the nine months ended December 31, 2020 is not disclosed.

—6—

(Applied special accounting methods used for preparing quarterly consolidated financial statements)

Accounting treatment of tax expenses

The Company and certain domestic consolidated subsidiaries calculated tax expenses by multiplying Income before income taxes by an effective tax rate that was reasonably estimated by applying tax effect accounting to estimated Income before income taxes for the fiscal year ending March 31, 2022 including the period for the nine months ended December 31, 2021. Amounts of Income taxes include Income taxes-deferred.

(Additional information)

1. Transition from the consolidated corporate-tax system to the group tax sharing system

Companies are required to shift from the consolidated corporate-tax system to the group tax sharing system from the fiscal year beginning on or after April 1, 2022, in accordance with the “Act for Partial Amendment of the Income Tax Act, etc.” (Act No. 8, 2020) enacted on March 31, 2020. However, the Company and certain consolidated domestic subsidiaries, currently adopting the consolidated corporate-tax system, applied the accounting treatment based on the provisions of the Income Tax Act before the amendment for the nine months ended December 31, 2021, in accordance with the “Practical Solution on the Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (ASBJ Practical Issue Task Force No. 39, March 31, 2020).

2. Repurchase and cancellation of own shares

On November 12, 2021, the Board of Directors of the Company resolved to repurchase its own shares under Article 8 of its Articles of Incorporation pursuant to Paragraph 1 of Article 459 of the Companies Act and cancel the repurchased shares pursuant to Article 178 of the Companies Act.

(1)

Reason for the Repurchase of Own Shares

The Company will proceed with a flexible repurchase of its own shares in order to enhance shareholder returns and improve capital efficiency.

(2)

Outline of the Repurchase

Type of shares to be repurchased: Common stock

Aggregate number of shares to be repurchased:

Up to 33,000,000 shares (Equivalent to 2.4% of the number of shares issued (excluding treasury stock))

Aggregate amount of shares to be repurchased: Up to JPY100,000,000,000

Repurchase period: From November 15, 2021 to November 11, 2022

Repurchase method:

Market purchases based on a discretionary dealing contract regarding repurchase of its own shares

(3)

Outline of the Cancellation

Type of shares to be cancelled: Common stock

Number of shares to be cancelled: All of shares repurchased as stated in 2 above.

Scheduled cancellation date: December 20, 2022

The Company had not conducted the Repurchase and cancellation pursuant to the resolution of the Board of Directors as of December 31, 2021.

—7—

(Notes to quarterly consolidated balance sheets)

*1	Risk-monitored loans

Risk-monitored loans at March 31, 2021 and December 31, 2021 were as follows:


	Millions of yen
	March 31, 2021		December 31, 2021
Bankrupt loans	¥	69,452	¥	37,215
Non-accrual loans		422,551		625,697
Past due loans (3 months or more)		16,784		15,751
Restructured loans		430,080		366,769

Risk-monitored loans	¥	938,868	¥	1,045,434

The amounts of loans presented above are the amounts before deduction of reserve for possible loan losses.

*2	Guaranteed amount to privately-placed bonds

The amounts guaranteed by SMBC and its banking subsidiaries to privately-placed bonds (stipulated by Article 2-3 of the Financial Instruments and Exchange Act) in “Securities” at March 31, 2021 and December 31, 2021 were as follows:


	Millions of yen
	March 31, 2021		December 31, 2021
Guaranteed amount to privately-placed bonds	¥	1,431,071	¥	1,380,431

(Notes to quarterly consolidated statements of income)

*1	Other income

“Other income” for the nine months ended December 31, 2020 and 2021 included the following:


Nine months ended December 31, 2020	Millions of yen		Nine months ended December 31, 2021	Millions of yen
Gains on sales of stocks	¥	106,079	Gains on sales of stocks	¥	152,024

*2	Other expenses

“Other expenses” for the nine months ended December 31, 2020 and 2021 included the following:


Nine months ended December 31, 2020	Millions of yen		Nine months ended December 31, 2021	Millions of yen
Provision for reserve for possible loan losses	¥	139,306	Provision for reserve for possible loan losses	¥	98,303
Write-off of loans		90,761	Write-off of loans		67,563
Expenses related to equity derivatives		41,415
Write-off of stocks and others		28,698

*3	Extraordinary gains

“Extraordinary gains” for the nine months ended December 31, 2020 and 2021 were as follows:


Nine months ended December 31, 2020	Millions of yen		Nine months ended December 31, 2021	Millions of yen
Gains on disposal of fixed assets	¥	419	Gains on disposal of fixed assets	¥	1,531
Gains on step acquisitions		404

*4	Extraordinary losses

“Extraordinary losses” for the nine months ended December 31, 2020 and 2021 included the following:


Nine months ended December 31, 2020	Millions of yen		Nine months ended December 31, 2021	Millions of yen
Losses on impairment of fixed assets	¥	7,134	Losses on impairment of fixed assets	¥	4,890
Losses on disposal of fixed assets		981	Losses on disposal of fixed assets		1,773

—8—

(Notes to quarterly consolidated statements of cash flows)

Quarterly consolidated statements of cash flows are not prepared for the nine months ended December 31, 2021. “Depreciation” (including amortization of intangible fixed assets other than goodwill) and “Amortization of goodwill” for the nine months ended December 31, 2020 and 2021 are as follows:


	Millions of yen
Nine months ended December 31	2020		2021
Depreciation	¥	155,994	¥	165,260
Amortization of goodwill		14,885		12,543

(Notes to stockholders’ equity)

Dividends paid in the nine months ended December 31, 2020

Date of resolution

Type of shares

Millions of yen, except per share amount

Cash dividends

Cash
dividends
per share

Record date

Effective date

Source of
dividends

Ordinary General Meeting of Shareholders held on June 26, 2020

Common stock

136,952

100

March 31, 2020

June 29, 2020

Retained
earnings

Meeting of the Board of Directors held on November 13, 2020

Common stock

130,190

September 30, 2020

December 3, 2020

Retained
earnings

Dividends paid in the nine months ended December 31, 2021

Date of resolution

Type of shares

Millions of yen, except per share amount

Cash dividends

Cash
dividends
per share

Record date

Effective date

Source of
dividends

Ordinary General Meeting of Shareholders held on June 29, 2021

Common stock

130,190

March 31, 2021

June 30, 2021

Retained
earnings

Meeting of the Board of Directors held on November 12, 2021

Common stock

143,936

105

September 30, 2021

December 3,2021

Retained
earnings

—9—

(Notes to segment and other related information)

[Segment information]

1. Information on profit and loss amount by reportable segment


Nine months ended December 31, 2020	Millions of yen
Nine months ended December 31, 2020	Wholesale Business Unit		Retail Business Unit		Global Business Unit		Global Markets Business Unit		Head office account and others		Total
Consolidated gross profit	¥	446,900	¥	840,300	¥	514,400	¥	384,800	¥	(116,014)	¥	2,070,386
Expenses		(223,800)		(673,000)		(273,600)		(61,100)		(47,852)		(1,279,352)
Others		40,300		1,800		19,100		25,600		(67,214)		19,586

Consolidated net business profit	¥	263,400	¥	169,100	¥	259,900	¥	349,300	¥	(231,080)	¥	810,620


Nine months ended December 31, 2021	Millions of yen
Nine months ended December 31, 2021	Wholesale Business Unit		Retail Business Unit		Global Business Unit		Global Markets Business Unit		Head office account and others		Total
Consolidated gross profit	¥	511,600	¥	860,800	¥	619,100	¥	346,100	¥	(155,546)	¥	2,182,054
Expenses		(225,300)		(700,400)		(329,900)		(67,200)		(7,690)		(1,330,490)
Others		46,900		1,900		43,900		29,100		(67,731)		54,069

Consolidated net business profit	¥	333,200	¥	162,300	¥	333,100	¥	308,000	¥	(230,968)	¥	905,632



Notes:	1.	Figures shown in the parenthesis represent the loss.
	2.	“Others” includes equity in profit and loss of affiliates and cooperated profit and loss based on internal managerial accounting.
	3.	“Head office account and others” includes profit or loss to be eliminated as inter-segment transactions.

2.	Difference between total amount of consolidated net business profit by reportable segment and ordinary profit on quarterly consolidated statements of income (adjustment of difference)


Nine months ended December 31, 2020	Millions of yen
Consolidated net business profit	¥	810,620
Other ordinary income (excluding equity in gains of affiliates)		125,112
Other ordinary expenses		(340,851)

Ordinary profit on quarterly consolidated statements of income	¥	594,881

Note: Figures shown in the parenthesis represent the loss.


Nine months ended December 31, 2021	Millions of yen
Consolidated net business profit	¥	905,632
Other ordinary income (excluding equity in gains of affiliates)		183,728
Other ordinary expenses		(221,986)

Ordinary profit on quarterly consolidated statements of income	¥	867,373

Note: Figures shown in the parenthesis represent the loss.

[Related information]

[Information on amortization of goodwill and unamortized balance by reporting segment]

During the nine months ended December 31, 2021, Fullerton India Credit Company Limited and its 1 subsidiary were newly included in the scope of consolidation. As a result, an increase in goodwill of ¥185,916 million was recognized in “Head office account and others.” The amount of goodwill had been calculated on a preliminary basis since allocation of acquisition cost was yet to be completed.

—10—

(Notes to financial instruments)

There are no significant matters to be disclosed regarding financial instruments.

(Notes to securities)

The amounts shown in the following tables include negotiable certificates of deposit classified as “Cash and due from banks” and beneficiary claims on loan trust classified as “Monetary claims bought,” in addition to “Securities” stated in the quarterly consolidated balance sheets.

1. Bonds classified as held-to-maturity


	Millions of yen
March 31, 2021	Consolidated balance sheet amount		Fair value		Net unrealized gains (losses)
Japanese government bonds	¥	—	¥	—	¥	—
Japanese local government bonds		22,300		22,239		(60	)
Japanese corporate bonds		—		—		—
Other		—		—		—

Total	¥	22,300	¥	22,239	¥	(60	)

Note: The fair values are based on their market prices and others at the end of the fiscal year.
	Millions of yen
December 31, 2021	Quarterly consolidated balance sheet amount		Fair value		Net unrealized gains (losses)
Japanese government bonds	¥	—	¥	—	¥	—
Japanese local government bonds		22,300		22,324		24
Japanese corporate bonds		—		—		—
Other		—		—		—

Total	¥	22,300	¥	22,324	¥	24

Note: The fair values are based on their market prices and others at the end of the period.

—11—

2. Other securities


	Millions of yen
March 31, 2021	Acquisition cost		Consolidated balance sheet amount		Net unrealized gains (losses)
Stocks	¥	1,294,609	¥	3,550,247	¥	2,255,637
Bonds		17,647,205		17,655,237		8,032
Japanese government bonds		14,307,684		14,293,610		(14,074)
Japanese local government bonds		733,276		732,622		(654)
Japanese corporate bonds		2,606,244		2,629,005		22,761
Other		14,079,437		14,747,596		668,159

Total	¥	33,021,251	¥	35,953,082	¥	2,931,830

Notes:

Consolidated balance sheet amount is measured at fair value based on its market price and others at the end of the fiscal year.

Net unrealized gains (losses) on other securities shown above include gains of ¥399 million for the fiscal year ended March 31, 2021 that are recognized in the earnings by applying fair value hedge accounting.


	Millions of yen
December 31, 2021	Acquisition cost		Quarterly consolidated balance sheet amount		Net unrealized gains (losses)
Stocks	¥	1,233,902	¥	3,467,629	¥	2,233,727
Bonds		17,335,013		17,340,386		5,373
Japanese government bonds		13,640,010		13,627,015		(12,995)
Japanese local government bonds		1,070,278		1,071,135		856
Japanese corporate bonds		2,624,724		2,642,236		17,511
Other		14,079,590		14,714,087		634,497

Total	¥	32,648,506	¥	35,522,104	¥	2,873,597

Notes:

Quarterly consolidated balance sheet amount is measured at fair value based on its market price and others at the end of the period.

Net unrealized gains (losses) on other securities shown above include losses of ¥1,677 million for the nine months ended December 31, 2021 that are recognized in the earnings by applying fair value hedge accounting.

—12—

3. Write-down of securities

Bonds classified as held-to-maturity and other securities (excluding other securities whose quarterly consolidated balance sheet amounts are not measured at fair value) are considered as impaired if the fair value decreases materially below the acquisition cost and such decline is not considered as recoverable. The fair value is recognized as the quarterly consolidated balance sheet amount (consolidated balance sheet amount) and the amount of write-down is accounted for as valuation loss for the period. Valuation losses for the fiscal year ended March 31, 2021 and for the nine months ended December 31, 2021 were ¥8,480 million and ¥3,579 million, respectively. The rule for determining “material decline” is as follows and is based on the classification of issuers under the rules of self-assessment of assets.


Bankrupt/Effectively bankrupt/Potentially bankrupt issuers:		Fair value is lower than acquisition cost.
Issuers requiring caution:		Fair value is 30% or lower than acquisition cost.
Normal issuers:		Fair value is 50% or lower than acquisition cost.

Bankrupt issuers: Issuers that are legally bankrupt or formally declared bankrupt.

Effectively bankrupt issuers: Issuers that are not legally bankrupt but regarded as substantially bankrupt.

Potentially bankrupt issuers: Issuers that are not bankrupt now, but are perceived to have a high risk of falling into bankruptcy.

Issuers requiring caution: Issuers that are identified for close monitoring.

Normal issuers: Issuers other than the above 4 categories of issuers.

(Notes to money held in trust)

1.	Money held in trust classified as held-to-maturity

Fiscal year ended March 31, 2021

There are no corresponding transactions.

Nine months ended December 31, 2021

There are no corresponding transactions.

2.	Other money held in trust (Other than trading and held to maturity)


	Millions of yen
March 31, 2021	Acquisition cost		Consolidated balance sheet amount		Net unrealized gains (losses)
Other money held in trust	¥	309	¥	309	¥	—

Note: Consolidated balance sheet amount is measured at fair value based on its market price and others at the end of the fiscal year.


	Millions of yen
December 31, 2021	Acquisition cost		Quarterly consolidated balance sheet amount		Net unrealized gains (losses)
Other money held in trust	¥	310	¥	310	¥	—

Note: Quarterly consolidated balance sheet amount is measured at fair value based on its market price and others at the end of the period.

—13—

(Notes to derivative transactions)

(1)	Interest rate derivatives


	Millions of yen
March 31, 2021	Contract amount		Fair Value		Valuation gains (losses)
Listed
Interest rate futures	¥	25,888,051	¥	(399)	¥	(399)
Interest rate options		186,354,379		24,132		24,132
Over-the-counter
Forward rate agreements		110,232,727		(3)		(3)
Interest rate swaps		468,245,252		236,177		236,177
Interest rate swaptions		12,923,702		(5,569)		(5,569)
Caps		78,116,759		(30,248)		(30,248)
Floors		6,387,606		1,437		1,437
Other		7,937,112		49,813		49,813

Total		/	¥	275,340	¥	275,340



Note:		The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.


	Millions of yen
December 31, 2021	Contract amount		Fair Value		Valuation gains (losses)
Listed
Interest rate futures	¥	24,856,501	¥	(85)	¥	(85)
Interest rate options		257,411,816		59,185		59,185
Over-the-counter
Forward rate agreements		7,442,766		9		9
Interest rate swaps		552,427,741		166,903		166,903
Interest rate swaptions		19,532,475		7,229		7,229
Caps		97,333,397		(81,675)		(81,675)
Floors		6,689,584		6,789		6,789
Other		11,121,298		40,954		40,954

Total		/	¥	199,311	¥	199,311



Note:		The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.

—14—

(2)	Currency derivatives


	Millions of yen
March 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Currency futures	¥	8,068	¥	93	¥	93
Over-the-counter
Currency swaps		76,626,201		(78,194)		161,586
Currency swaptions		590,391		(375)		(375)
Forward foreign exchange		77,285,120		134,477		134,477
Currency options		5,349,872		(2,957)		(2,957)

Total		/	¥	53,043	¥	292,824

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above. In addition, transactions related to financial assets and liabilities denominated in foreign currencies and recognized in the consolidated balance sheets, or transactions related to financial assets and liabilities denominated in foreign currencies which have been eliminated in the consolidation are not included in the above table.


	Millions of yen
December 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Currency futures	¥	10,152	¥	(166)	¥	(166)
Over-the-counter
Currency swaps		81,991,384		262,994		149,342
Currency swaptions		653,187		181		181
Forward foreign exchange		81,446,381		(51,115)		(51,115)
Currency options		5,588,213		(12,003)		(12,003)

Total		/	¥	199,889	¥	86,237

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above. In addition, transactions related to financial assets and liabilities denominated in foreign currencies and recognized in the quarterly consolidated balance sheets, or transactions related to financial assets and liabilities denominated in foreign currencies which have been eliminated in the consolidation are not included in the above table.

—15—

(3)	Equity derivatives


	Millions of yen
March 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Equity price index futures	¥	1,608,787	¥	4,413	¥	4,413
Equity price index options		950,757		(35,025)		(35,025)
Over-the-counter
Equity options		158,739		12,997		12,997
Equity index forward contracts		3,574		98		98
Equity index swaps		280,436		11,472		11,472

Total		/	¥	(6,043)	¥	(6,043)

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above.


	Millions of yen
December 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Equity price index futures	¥	1,558,784	¥	(1,678)	¥	(1,678)
Equity price index options		1,245,924		(48,645)		(48,645)
Over-the-counter
Equity options		262,877		18,891		18,891
Equity index forward contracts		1,038		(4)		(4)
Equity index swaps		336,089		26,155		26,155

Total		/	¥	(5,282)	¥	(5,282)

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above.

—16—

(4)	Bond derivatives


	Millions of yen
March 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Bond futures	¥	2,944,735	¥	536	¥	536
Bond futures options		70,891		(52)		(52)
Over-the-counter
Bond forward contracts		103		3		3
Bond options		226,347		15		15

Total		/	¥	503	¥	503

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above.


	Millions of yen
December 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Bond futures	¥	7,973,704	¥	1,693	¥	1,693
Bond futures options		50,814		0		0
Over-the-counter
Bond forward contracts		—		—		—
Bond options		178,299		223		223

Total		/	¥	1,917	¥	1,917

Note:

The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.

Derivative transactions to which the hedge accounting method is applied are not included in the table above.

—17—

(5)	Commodity derivatives


	Millions of yen
March 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Commodity futures	¥	30,916	¥	532	¥	532
Over-the-counter
Commodity swaps		76,264		1,973		1,973
Commodity options		2,484		(486)		(486)

Total		/	¥	2,019	¥	2,019



Notes:	1.	The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.
	2.	Underlying assets of commodity derivatives are fuels and metals.


	Millions of yen
December 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Listed
Commodity futures	¥	15,662	¥	407	¥	407
Over-the-counter
Commodity swaps		72,797		1,346		1,346
Commodity options		3,462		(442)		(442)

Total		/	¥	1,312	¥	1,312



Notes:	1.	The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.
	2.	Underlying assets of commodity derivatives are fuels and metals.

(6)	Credit derivative transactions


	Millions of yen
March 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Over-the-counter
Credit default options	¥	2,774,559	¥	(5,716)	¥	(5,716)

Total		/	¥	(5,716)	¥	(5,716)



Note:		The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.


	Millions of yen
December 31, 2021	Contract amount		Fair value		Valuation gains (losses)
Over-the-counter
Credit default options	¥	2,649,246	¥	(4,045)	¥	(4,045)

Total		/	¥	(4,045)	¥	(4,045)



Note:		The above transactions are valued at fair value and the valuation gains (losses) are accounted for in the quarterly consolidated statements of income.
		Derivative transactions to which the hedge accounting method is applied are not included in the table above.

—18—

(Business combination)

Fullerton India Credit Company Limited became a consolidated subsidiary of the Company

On November 30, 2021, the Company acquired partial shares of Fullerton India Credit Company Limited (“FICC”) based on the agreement concluded on July 6, 2021 among the Company, Fullerton Financial Holdings Pte. Ltd. and Angelica Investments Pte. Ltd. As a result, FICC and its 1 subsidiary became consolidated subsidiaries of the Company.

1. Outline of the business combination

(1)	Name of the acquired company and its business

Name: Fullerton India Credit Company Limited

Business: Finance-related business

(2)	Main reasons for the business combination

By investing in FICC, which has a strong pan-India distribution network with more than 650 branches and offers unsecured loans and loans against property to mainly SMEs, the self-employed, and mass market customers, the Company will gain a retail finance platform in India, which is essential for the expansion of its Asia franchise.

(3)	Date of the business combination

November 30, 2021

(4)	Legal form of the business combination

Acquisition of stock

(5)	Name of the entity after the business combination

Sumitomo Mitsui Financial Group, Inc.

(6)	The ratio of acquired voting rights

74.90%

(7)	Grounds for deciding on the acquiring company

The Company owns a majority of the voting rights of FICC

—19—

2. Period of the acquired company’s financial result included in the consolidated statements of income of the Company

The financial result of the acquired company is not included in the consolidated statements of income for the nine months ended December 31, 2021, because December 31, 2021 is the deemed acquisition date.

3. Acquisition cost and consideration of the acquired company

Consideration for the acquisition (cash): ¥230,314 million

Acquisition cost of the acquired company: ¥230,314 million

4. Amount of goodwill, reason for recognizing goodwill, amortization method and the period

(1)	Amount of goodwill

¥185,916 million

The amount was calculated on a preliminary basis

(2)	Reason for recognizing goodwill

The Company accounted for the difference between the acquisition cost and the fair value of the net assets corresponding to equity on the date of the business combination as goodwill.

(3)	Amortization method and the period

Goodwill is amortized using the straight-line method over 15 years.

—20—

(Revenue Recognition)

Information on breakdown of revenues from contracts with customers.


Nine months ended December 31	Millions of yen
Nine months ended December 31	2021
Ordinary income	¥	2,995,751
Fees and commissions		1,038,336
Deposits and loans		139,448
Remittances and transfers		106,576
Securities-related business		135,417
Agency		6,787
Safe deposits		3,969
Guarantees		60,652
Credit card business		247,583
Investment trusts		140,761
Others		197,141



Note:		Fees and commissions obtained through Deposits and loans principally arise in the Wholesale Business Unit and the Global Business Unit, Remittances and transfers principally arise in the Wholesale Business Unit, the Retail Business Unit, and the Global Business Unit, Securities-related business principally arise in the Wholesale Business Unit, the Retail Business Unit, and the Global Business Unit, Credit card business principally arise in the Retail Business Unit, and Investment trusts principally arise in the Retail Business Unit and Head office account and others. Income based on “Accounting Standard for Financial Instrument” (ASBJ Statement No. 10) is also included in the table above.

(Per share data)

Earnings per share, earnings per share (diluted) and each calculation method are as follows:


Nine months ended December 31	Millions of yen, except per share data and number of shares
Nine months ended December 31	2020		2021
(i) Earnings per share	¥	316.70	¥	455.82
[The calculation method]
Profit attributable to owners of parent		433,929		624,795
Amount not attributable to common stockholders		—		—
Profit attributable to owners of parent concerning common stock		433,929		624,795
Average number of common stock during the period (in thousands)		1,370,141		1,370,711
(ii) Earnings per share (diluted)	¥	316.55	¥	455.62
[The calculation method]
Adjustment for profit attributable to owners of parent		—		—
Adjustment of dilutive shares issued by consolidated subsidiaries and equity method affiliates		—		—
Increase in the number of common stock (in thousands)		665		602
Stock acquisition rights (in thousands)		665		602
Outline of dilutive shares which were not included in the calculation of “Earnings Per Share (diluted)” because they do not have dilutive effect and have significant changes from the fiscal year ended March 31, 2021 :		—		—

(Significant Subsequent Events)

There are no significant subsequent events to be disclosed.

—21—

(Others)

Interim dividends (dividends from surplus under Article 454, Paragraph 5 of the Companies Act)

The meeting of Board of Directors held on November 12, 2021 resolved interim dividends for the fiscal year ending March 31, 2022 as shown below:

—22—

Figures shown in the parenthesis represent the loss.

“Others” includes equity in profit and loss of affiliates and cooperated profit and loss based on internal managerial accounting.

“Head office account and others” includes profit or loss to be eliminated as inter-segment transactions.