Credit Quality of Financial Assets and the Allowance for Credit Losses (Tables)

12 Months Ended

Mar. 31, 2022

Credit Loss [Abstract]

Summary of allowance for credit losses for installment loans

The following table provides information about the allowance for credit losses for installment loans, net investment in leases and other financial assets measured at amortized cost for fiscal 2021 and 2022:

	Fiscal Year ended March 31, 2021
	Millions of yen
	Beginning balance		Cumulative effect of adopting According Standards Update 2016-13			Reclassification to allowance for investment in operating leases *4			Balance at April 1, 2020		Provision (Reversal)*3			Allowance of purchased loans during the reporting period		Charge- offs*5			Recoveries		Other*6			Ending balance*3		Collective (pool) assessment		Individual assessment
Allowance for credit losses :
Installment loans to consumer borrowers:
Real estate loans
Japan	¥	3,112	¥	2,856		¥	0		¥	5,968	¥	390		¥	0	¥	(495	)	¥	59	¥	0		¥	5,922	¥	5,354	¥	568
Overseas		128		(102	)		0			26		412			0		0			1		31			470		470		0
Card loans
Japan		3,785		12,146			0			15,931		(802	)		0		(2,150	)		6		(1	)		12,984		12,283		701
Other
Japan		12,735		(963	)		0			11,772		5,875			0		(9,296	)		8		0			8,359		5,616		2,743
Overseas		782		563			0			1,345		739			0		(1,754	)		577		368			1,275		1,038		237
Installment loans to corporate borrowers:
Non-recourse loans
Japan		13		24			0			37		(5	)		0		0			0		0			32		32		0
The Americas		1,773		1,577			0			3,350		43			0		0			0		57			3,450		3,218		232
Real estate companies
Japan		983		46			0			1,029		(58	)		0		(96	)		25		1			901		621		280
Overseas		2,010		1,579			0			3,589		(1,502	)		0		(570	)		33		(11	)		1,539		1,539		0
Commercial, industrial companies
Japan		2,447		98			0			2,545		(27	)		0		(592	)		11		1			1,938		199		1,739
Overseas		14,769		9,002			0			23,771		10,410			0		(15,427	)		18		(9	)		18,763		13,013		5,750
Purchased loans*1		1,458		0			0			1,458		353			3,899		(4,040	)		46		119			1,835		681		1,154
Net investment in leases:		11,692		3,550			0			15,242		3,285			0		(2,668	)		10		653			16,522		13,267		3,255
Subtotal		55,687		30,376			0			86,063		19,113			3,899		(37,088	)		794		1,209			73,990		57,331		16,659
Other financial assets measured at amortized cost*2		1,149		1,369			(312	)		2,206		4,483			0		(344	)		11		(351	)		6,005		810		5,195
Total	¥	56,836	¥	31,745		¥	(312	)	¥	88,269	¥	23,596		¥	3,899	¥	(37,432	)	¥	805	¥	858		¥	79,995	¥	58,141	¥	21,854

	Fiscal Year ended March 31, 2022
	Millions of yen
	Beginning balance		Provision (Reversal)*3			Allowance of purchased loans during the reporting period		Charge- offs*5			Recoveries		Other*6		Ending balance*3		Collective (pool) assessment		Individual assessment
Allowance for credit losses :
Installment loans to consumer borrowers:
Real estate loans
Japan	¥	5,922	¥	340		¥	0	¥	(570	)	¥	24	¥	0	¥	5,716	¥	5,211	¥	505
Overseas		470		(34	)		0		0			4		15		455		455		0
Card loans
Japan		12,984		(1,301	)		0		(1,669	)		4		1		10,019		9,423		596
Other
Japan		8,359		4,948			0		(8,114	)		11		0		5,204		2,946		2,258
Overseas		1,275		300			0		(644	)		0		174		1,105		961		144
Installment loans to corporate borrowers:
Non-recourse loans
Japan		32		49			0		0			0		0		81		81		0
The Americas		3,450		(1,035	)		0		0			0		276		2,691		1,836		855
Real estate companies
Japan		901		(204	)		0		(109	)		29		0		617		490		127
Overseas		1,539		(855	)		0		(10	)		0		61		735		735		0
Commercial, industrial companies
Japan		1,938		93			0		(761	)		67		0		1,337		505		832
Overseas		18,763		3,503			0		(6,185	)		155		2,060		18,296		13,367		4,929
Purchased loans*1		1,835		(227	)		2,210		(2,372	)		114		15		1,575		608		967
Net investment in leases:		16,522		1,577			0		(2,802	)		21		985		16,303		12,480		3,823
Subtotal		73,990		7,154			2,210		(23,236	)		429		3,587		64,134		49,098		15,036
Other financial assets measured at amortized cost*2		6,005		2,662			0		(1,661	)		45		231		7,282		562		6,720
Total	¥	79,995	¥	9,816		¥	2,210	¥	(24,897	)	¥	474	¥	3,818	¥	71,416	¥	49,660	¥	21,756

Notes: 1. Loans held for sale and policy loan receivables of an insurance entity are not scope to allowance for credit losses.

2. Held-to-maturity debt securities held by the Company and subsidiaries consist of Japanese government bonds (JGBs) and other securities secured by JGBs. There was no allowance for credit losses on these held-to-maturity debt securities. And there is no delinquency or on non-accrual status on held-to-maturity debt securities.

*1 Purchased loans represent loans with evidence of deterioration of credit quality since origination and for which it is probable at acquisition that collection of all contractually required payments from the debtors is unlikely. Due to the adoption of Credit Losses Standard, allowance of ¥176,714 million was recorded as credit loss gross-up treatment for purchased loans on April 1, 2020, and the same amount has been charged-off.

Summary of disclosure in tabular form of allowances for credit losses and provision for credit losses

	Millions of yen
	2021						2022
	Provision for credit losses			Allowance for credit losses			Provision for credit losses			Allowance for credit losses
Net investment in leases	¥	3,285		¥	16,522		¥	1,577		¥	16,303
Installment loans		15,828			57,468			5,577			47,831
Subtotal in the above table		19,113			73,990			7,154			64,134
Other financial assets measured at amortized cost		4,483			6,005			2,662			7,282
Total in the above table		23,596			79,995			9,816			71,416
Off-balance sheet credit exposures*3(a)		(7,437	)		—			(4,449	)		—
Available-for-sale debt securities*3(b)		117			—			21			—
Less: Loans to affiliates*3(c)		(255	)		(1,050	)		(1,449	)		(1,957	)
Amount reported on the consolidated financial statements	¥	16,021		¥	78,945		¥	3,939		¥	69,459

*3(a) The allowance for off-balance sheet credit exposure were ¥26,094 million and ¥22,120 million as of March 31, 2021 and 2022, respectively, and the amounts are recorded in “Other liabilities” on the consolidated balance sheets. For further information, see Note 31 “Commitments, Guarantees and Contingent Liabilities.”

*3(b) The allowance for available-for-sale debt securities were ¥120 million and ¥153 million as of March 31, 2021 and 2022, respectively, and the amounts are recorded as a reduction in “Investments in securities” on the consolidated balance sheets. For further information, see Note 10 “Investment in Securities.”

*3(c) The provision for credit losses on loans to affiliates were ¥255 million and ¥1,449 million during fiscal 2021 and 2022, respectively, and the amounts are recorded in “Equity in net income (loss) of affiliates” in the consolidated statements of income. The allowance for credit losses on loans to affiliates were ¥1,050 million and ¥1,957 million as of March 31, 2021 and 2022, respectively, and the amounts are recorded as a reduction in “Investments in affiliates” on the consolidated balance sheets.

Summary of purchased loans

The following table provides information about purchased loans which were acquired for fiscal 2021 and 2022:

	Millions of yen
	Fiscal Year ended March 31, 2021		Fiscal Year ended March 31, 2022
Purchase price	¥	2,705	¥	4,926
Allowance for credit losses at acquisition date		3,899		2,210
Discount or premium attributable to other factors		254		220
Par value	¥	6,858	¥	7,356

Summary of origination years of financial assets

The following table provides information about the origination years of financial assets as of March 31, 2021 and 2022. Card loans to consumer borrowers with a revolving repayment feature that cannot be classified into the origination year are excluded from the table.

		March 31, 2021
		Millions of yen
Portfolio segment		Origination year (years ended March 31)
Class
	Credit Quality	2021		2020		2019		2018		2017		Prior		Total
Consumer borrowers:
	Performing	¥	371,914	¥	443,079	¥	332,461	¥	220,035	¥	223,814	¥	498,350	¥	2,089,653
	Non-Performing		11,041		7,854		5,132		3,176		2,612		3,609	¥	33,424
Real estate loans
	Performing		362,832		431,483		327,967		217,380		223,540		498,080	¥	2,061,282
	Non-Performing		96		735		1,598		1,683		2,068		3,459	¥	9,639
Other*
	Performing		9,082		11,596		4,494		2,655		274		270	¥	28,371
	Non-Performing		10,945		7,119		3,534		1,493		544		150	¥	23,785
Corporate borrowers:
	Performing		341,346		378,732		207,214		124,889		71,400		97,113	¥	1,220,694
	Non-Performing		6,972		12,215		6,594		7,266		4,110		10,709	¥	47,866
Non-recourse loans
Japan
	Performing		6,637		24,428		5,283		2,802		0		8,806	¥	47,956
The Americas
	Performing		1,349		52,413		28,291		15,817		5,178		8,764	¥	111,812
	Non-Performing		58		0		0		0		0		1,259	¥	1,317
Other than non-recourse loans
Real estate companies in Japan
	Performing		103,982		62,274		35,065		28,743		25,487		21,753	¥	277,304
	Non-Performing		70		252		192		0		690		538	¥	1,742
Real estate companies in overseas
	Performing		42,980		55,678		10,695		4,992		1,976		2,976	¥	119,297
	Non-Performing		0		3,049		2,057		4,946		1,056		3,397	¥	14,505
Commercial, industrial and other companies in Japan
	Performing		78,281		41,166		30,116		12,746		11,798		18,664	¥	192,771
	Non-Performing		1,210		3,865		205		878		82		1,022	¥	7,262
Commercial, industrial and other companies in overseas
	Performing		108,117		142,773		97,764		59,789		26,961		36,150	¥	471,554
	Non-Performing		5,634		5,049		4,140		1,442		2,282		4,493	¥	23,040
Purchased loans:
	Performing		527		0		0		168		119		9,714	¥	10,528
	Non-Performing		0		0		0		15		0		1,808	¥	1,823

		March 31, 2021
		Millions of yen
Portfolio segment		Origination year (years ended March 31)
Class
	Credit Quality	2021		2020		2019		2018		2017		Prior		Total
Net investment in leases:
	Performing	¥	333,190	¥	268,966	¥	171,040	¥	105,708	¥	62,977	¥	68,712	¥	1,010,593
	Non-Performing		1,366		3,057		3,441		3,151		2,980		4,930	¥	18,925
Japan
	Performing		184,342		165,580		121,072		84,928		57,393		67,040	¥	680,355
	Non-Performing		151		776		1,194		1,512		1,261		2,213	¥	7,107
Overseas
	Performing		148,848		103,386		49,968		20,780		5,584		1,672	¥	330,238
	Non-Performing		1,215		2,281		2,247		1,639		1,719		2,717	¥	11,818
Other financial assets measured at amortized cost
	Performing		14,882		1,045		67		938		2,502		13,762	¥	33,196
	Non-Performing		0		0		0		908		0		0	¥	908
Total (excluding revolving repayment card loans)
	Performing	¥	1,061,859	¥	1,091,822	¥	710,782	¥	451,738	¥	360,812	¥	687,651	¥	4,364,664
	Non-Performing	¥	19,379	¥	23,126	¥	15,167	¥	14,516	¥	9,702	¥	21,056	¥	102,946

		March 31, 2022
		Millions of yen
Portfolio segment		Origination year (years ended March 31)
Class
	Credit Quality	2022		2021		2020		2019		2018		Prior		Total
Consumer borrowers:
	Performing	¥	322,924	¥	314,935	¥	387,988	¥	314,163	¥	202,309	¥	595,321	¥	2,137,640
	Non-Performing		8,282		4,595		3,852		2,098		961		11,915	¥	31,703
Real estate loans
	Performing		302,695		309,893		382,612		311,959		198,974		594,612	¥	2,100,745
	Non-Performing		26		94		489		380		222		11,474	¥	12,685
Other*
	Performing		20,229		5,042		5,376		2,204		3,335		709	¥	36,895
	Non-Performing		8,256		4,501		3,363		1,718		739		441	¥	19,018
Corporate borrowers:
	Performing		487,433		188,634		283,950		127,128		96,851		111,640	¥	1,295,636
	Non-Performing		412		3,184		4,138		4,747		14,562		21,000	¥	48,043
Non-recourse loans
Japan
	Performing		26,991		6,686		24,244		5,256		2,750		8,158	¥	74,085
The Americas
	Performing		0		5,547		51,467		11,744		7,721		1,397	¥	77,876
	Non-Performing		0		64		0		1,587		0		1,391	¥	3,042
Other than non-recourse loans
Real estate companies in Japan
	Performing		102,719		48,420		37,845		28,727		24,481		34,111	¥	276,303
	Non-Performing		0		245		938		71		0		1,050	¥	2,304
Real estate companies in overseas
	Performing		24,104		26,751		41,644		2,256		5,478		740	¥	100,973
	Non-Performing		0		0		0		371		12,790		7,717	¥	20,878
Commercial, industrial and other companies in Japan
	Performing		75,273		24,808		26,748		13,746		6,457		13,806	¥	160,838
	Non-Performing		156		457		1,392		124		392		773	¥	3,294
Commercial, industrial and other companies in overseas
	Performing		258,346		76,422		102,002		65,399		49,964		53,428	¥	605,561
	Non-Performing		256		2,418		1,808		2,594		1,380		10,069	¥	18,525
Purchased loans:
	Performing		0		0		24		281		1,072		10,885	¥	12,262
	Non-Performing		0		0		0		0		0		1,485	¥	1,485
Net investment in leases:
	Performing		328,428		249,106		190,125		113,190		77,683		80,217	¥	1,038,749
	Non-Performing		2,608		2,899		3,474		2,787		2,178		5,278	¥	19,224

		March 31, 2022
		Millions of yen
Portfolio segment		Origination year (years ended March 31)
Class
	Credit Quality	2022		2021		2020		2019		2018		Prior		Total
Japan
	Performing	¥	119,538	¥	154,757	¥	133,589	¥	91,691	¥	68,087	¥	78,283	¥	645,945
	Non-Performing		402		605		1,044		1,103		1,247		2,109	¥	6,510
Overseas
	Performing		208,890		94,349		56,536		21,499		9,596		1,934	¥	392,804
	Non-Performing		2,206		2,294		2,430		1,684		931		3,169	¥	12,714
Other financial assets measured at amortized cost
	Performing		14,287		2,220		345		0		817		17,743	¥	35,412
	Non-Performing		0		0		58		0		1,586		0	¥	1,644
Total (excluding revolving repayment card loans)
	Performing	¥	1,153,072	¥	754,895	¥	862,432	¥	554,762	¥	378,732	¥	815,806	¥	4,519,699
	Non-Performing	¥	11,302	¥	10,678	¥	11,522	¥	9,632	¥	19,287	¥	39,678	¥	102,099

Note: Loans held for sale and policy loan receivables of an insurance entity are not included in the table above.

* Other in loans to consumer borrowers includes claims receivable arising from payments on guarantee of consumer loans. For further information, see Note 31 “Commitments, Guarantees and Contingent Liabilities.” 

Summary of revolving repayment card loans

The information about card loans to consumer borrowers with a revolving repayment feature that cannot be classified into the origination year as of March 31, 2021 and 2022 are as follows:

	March 31, 2021
	Millions of yen
Portfolio segment	Revolving repayment card loans		Modification of collection condition by relief of contract condition		Total—revolving repayment card loans		Total— origination year (excluding revolving repayment card loans)		Total— financial assets measured at amortized cost
Credit quality
Consumer borrowers:
Performing	¥	183,722	¥	0	¥	183,722	¥	4,364,664	¥	4,548,386
Non-Performing		1,132		3,693		4,825		102,946	¥	107,771

	March 31, 2022
	Millions of yen
Portfolio segment	Revolving repayment card loans		Modification of collection condition by relief of contract condition		Total—revolving repayment card loans		Total— origination year (excluding revolving repayment card loans)		Total— financial assets measured at amortized cost
Credit quality
Consumer borrowers:
Performing	¥	169,601	¥	0	¥	169,601	¥	4,519,699	¥	4,689,300
Non-Performing		671		3,415		4,086		102,099	¥	106,185

Summary of past-due financial assets

The following table provides information about the past-due financial assets as of March 31, 2021 and 2022:

	March 31, 2021
		Millions of yen
		Past-due financing assets
Portfolio segment	Class	30-89 days past-due		90 days or more past-due		Total past-due		Total financing receivables
Consumer borrowers		¥	4,553	¥	10,257	¥	14,810	¥	2,311,624
	Real estate loans		1,375		2,515		3,890		2,070,921
	Card loans		371		1,105		1,476		188,547
	Other		2,807		6,637		9,444		52,156
Corporate borrowers			8,296		24,443		32,739		1,268,560
Non-recourse loans	Japan		0		0		0		47,956
	The Americas		5,193		1,316		6,509		113,129
Other than Non-recourse loans	Real estate companies in Japan		144		778		922		279,046
	Real estate companies in overseas		0		14,505		14,505		133,802
	Commercial, industrial and other companies in Japan		592		1,993		2,585		200,033
	Commercial, industrial and other companies in overseas		2,367		5,851		8,218		494,594
Net investment in leases			9,332		17,128		26,460		1,029,518
	Japan		2,257		6,347		8,604		687,462
	Overseas		7,075		10,781		17,856		342,056
Total		¥	22,181	¥	51,828	¥	74,009	¥	4,609,702

	March 31, 2022
		Millions of yen
		Past-due financing assets
Portfolio segment	Class	30-89 days past-due		90 days or more past-due		Total past-due		Total financing receivables
Consumer borrowers		¥	4,183	¥	5,637	¥	9,820	¥	2,343,030
	Real estate loans		1,473		2,262		3,735		2,113,430
	Card loans		371		503		874		173,687
	Other		2,339		2,872		5,211		55,913
Corporate borrowers			20,840		31,935		52,775		1,343,679
Non-recourse loans	Japan		0		0		0		74,085
	The Americas		514		3,042		3,556		80,918
Other than Non-recourse loans	Real estate companies in Japan		578		350		928		278,607
	Real estate companies in overseas		16,113		20,879		36,992		121,851
	Commercial, industrial and other companies in Japan		1,243		1,268		2,511		164,132
	Commercial, industrial and other companies in overseas		2,392		6,396		8,788		624,086
Net investment in leases			9,322		17,746		27,068		1,057,973
	Japan		2,252		5,782		8,034		652,455
	Overseas		7,070		11,964		19,034		405,518
Total		¥	34,345	¥	55,318	¥	89,663	¥	4,744,682

Note: Loans held for sale, policy loans receivable of an insurance entity and purchased loans are not included in the table above.

Summary of non-accrual of financial assets

The following table provides information about non-accrual of financial assets as of March 31, 2021 and 2022:

	March 31, 2021
	Millions of yen
	Beginning balance		Ending balance		Interest income recognized during the reporting period		Balance not associated allowance for credit losses among financial assets measured at amortized cost, which is suspending recognition of income
Non-accrual of financial assets:
Installment loans to consumer borrowers:
Real estate loans
Japan	¥	2,469	¥	1,976	¥	194	¥	424
Overseas		0		570		0		268
Card loans
Japan		2,114		1,115		50		0
Other
Japan		8,611		5,970		275		44
Overseas		413		691		0		0
Installment loans to corporate borrowers:
Non-recourse loans
The Americas		2,466		10,148		0		0
Real estate companies
Japan		586		778		30		509
Overseas		12,491		14,505		0		0
Commercial, industrial companies and other
Japan		2,409		1,993		196		127
Overseas		26,670		26,396		3		9,936
Net investment in leases		15,346		17,166		0		0
Total	¥	73,575	¥	81,308	¥	748	¥	11,308

	March 31, 2022
	Millions of yen
	Beginning balance		Ending balance		Interest income recognized during the reporting period		Balance not associated allowance for credit losses among financial assets measured at amortized cost, which is suspending recognition of income
Non-accrual of financial assets:
Installment loans to consumer borrowers:
Real estate loans
Japan	¥	1,976	¥	1,824	¥	193	¥	21
Overseas		570		475		0		129
Card loans
Japan		1,115		503		35		0
Other
Japan		5,970		2,391		208		0
Overseas		691		519		0		39
Installment loans to corporate borrowers:
Non-recourse loans
The Americas		10,148		8,787		0		0
Real estate companies
Japan		778		351		51		61
Overseas		14,505		20,879		0		0
Commercial, industrial companies and other
Japan		1,993		1,267		91		28
Overseas		26,396		18,634		112		4,018
Net investment in leases		17,166		17,771		0		0
Total	¥	81,308	¥	73,401	¥	690	¥	4,296

Summary of troubled debt restructurings of financing receivables

The following table provides information about troubled debt restructurings of financing receivables that occurred during the fiscal year ended March 31, 2021 and 2022:

	Fiscal Year ended March 31, 2021
		Millions of yen
Portfolio segment	Class	Pre-modification outstanding recorded investment		Post-modification outstanding recorded investment
Consumer borrowers		¥	9,279	¥	6,727
	Real estate loans		34		23
	Card loans		1,677		1,261
	Other		7,568		5,443
Corporate borrowers			14,723		13,049
Other than Non-recourse loans	Real estate companies in overseas		111		111
	Commercial, industrial and other companies in Japan		38		38
	Commercial, industrial and other companies in overseas		14,574		12,900
Total		¥	24,002	¥	19,776

	Fiscal Year ended March 31, 2022
		Millions of yen
Portfolio segment	Class	Pre-modification outstanding recorded investment		Post-modification outstanding recorded investment
Consumer borrowers		¥	8,761	¥	6,152
	Real estate loans		15		6
	Card loans		1,385		1,072
	Other		7,361		5,074
Corporate borrowers			5,481		5,319
Other than Non-recourse loans	Commercial, industrial and other companies in overseas		5,481		5,319
Total		¥	14,242	¥	11,471

Summary of financing receivables modified as troubled debt restructurings

The following table provides information about financing receivables modified as troubled debt restructurings within the previous 12 months from March 31, 2021 and for which there was a payment default during the fiscal year ended March 31, 2021:

	Fiscal Year ended March 31, 2021
		Millions of yen
Portfolio segment	Class	Recorded investment
Consumer borrowers		¥	387
	Card loans		36
	Other		351
Corporate borrowers			752
Other than Non-recourse loans	Commercial, industrial and other companies in overseas		752
Total		¥	1,139

The following table provides information about financing receivables modified as troubled debt restructurings within the previous 12 months from March 31, 2022 and for which there was a payment default during the fiscal year ended March 31, 2022:

	Fiscal Year ended March 31, 2022
		Millions of yen
Portfolio segment	Class	Recorded investment
Consumer borrowers		¥	900
	Real estate loans		4
	Card loans		6
	Other		890
Total		¥	900