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 under

the Securities Exchange Act of 1934

For the month of November 2023

Commission File No. 000-54189

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 office)

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      X        Form 40-F                  

THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE IN THE REGISTRATION STATEMENT ON FORM F-3 (NO. 333-273681) OF MITSUBISHI UFJ FINANCIAL GROUP, INC. AND TO BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT IS FURNISHED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS SUBSEQUENTLY FILED WITH OR FURNISHED TO THE U.S. SECURITIES AND EXCHANGE COMMISSION.

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: November 29, 2023

Mitsubishi UFJ Financial Group, Inc.
By:	/s/ Toshinao Endo
Name:	Toshinao Endo
Title:	Managing Director, Head of Documentation & Corporate Secretary Department, Corporate Administration Division

English Translation of Excerpts from Quarterly Securities Report Filed in Japan

This document is an English translation of selected information included in the Quarterly Securities Report for the quarter ended September 30, 2023 filed by Mitsubishi UFJ Financial Group, Inc. (“MUFG” or “we”) with the Kanto Local Financial Bureau, the Ministry of Finance of Japan, on November 29, 2023 (the “Quarterly Securities Report”). An English translation of certain information included in the Quarterly Securities Report was previously submitted in a report on Form 6-K dated November 14, 2023. Accordingly, this document should be read together with the previously submitted report.

The Quarterly Securities Report has been prepared and filed in Japan in accordance with applicable Japanese disclosure requirements as well as generally accepted accounting principles in Japan (“J-GAAP”). There are significant differences between J-GAAP and generally accepted accounting principles in the United States. In addition, the Quarterly Securities Report is being filed in the context of other prior disclosures filed by MUFG in Japan and discusses selected recent developments taking into account those prior disclosures. Accordingly, you may need to review the following disclosure, together with other prior disclosures, to obtain all of the information that is important to you. For a more complete discussion of the background to information provided below, please see our annual report on Form 20-F for the fiscal year ended March 31, 2023 and other reports filed with or submitted to the U.S. Securities and Exchange Commission by MUFG.

The following disclosure contains forward-looking statements, which, unless specifically stated otherwise, reflect our understanding as of the date of filing of the Quarterly Securities Report. Actual results may significantly differ from those expressed or implied by such forward-looking statements. In addition, although the Risk Committee identified the top risks below, there may be other material risks that emerge as we operate our businesses.

Risks Relating to Our Business

We describe below some major developments and changes to update our risk factor disclosure previously included in our annual securities report for the fiscal year ended March 31, 2023 filed in Japan on June 27, 2023. The updates below are not a complete update of the prior disclosure, but instead intended to explain only the significant developments and changes that we believe may have a material impact on the risks to our business and other risks. The discussion below contains forward-looking statements, which, unless specifically described otherwise, reflect our understanding as of the date of filing of the Quarterly Securities Report.

The numbering of the subheading of the risk disclosure below corresponds to the numbering of the subheading of the same risk disclosure in our most recent annual securities report filed in Japan.

We determine the significance of various risk scenarios based on their impact and probability and identify potential risk events that are deemed to require close monitoring and attention for the next one-year period as top risks. The main top risks identified by our Risk Committee in October 2023 are as follows. By identifying these top risks, we seek to implement necessary risk management measures designed to minimize such risks to the extent possible and manage them in such a manner that they can be agilely dealt with in the event that they materialize. In addition, through management’s participation in discussions on such top risks, we strive to take effective measures based on a shared assessment of risks.

Main Top Risks

Risk events	Risk scenarios
Decline in capital sufficiency / Increase in risk assets	•   Our capital management may be adversely affected by an increase in unrealized losses on debt securities due to a rise in interest rates globally.
Foreign currency liquidity risk	•   Deterioration in market conditions may result in a depletion of foreign currency funding liquidity and an increase in our foreign currency funding costs.
Increase in credit costs	•   Sudden deterioration in global economic activities may result in an increase in our credit costs. •   Deterioration in the credit quality of particular industries or counterparties, to which we have relatively larger exposures, may result in an increase in our credit costs.
IT risk	•   Cyber-attacks may result in customer information leakage, suspension of our services, and reputational damage. •   System problems may result in our payment of financial compensation and damage to our reputation.
Risks relating to climate changes	•   If our efforts to address climate change-related risks or to make appropriate disclosure are deemed insufficient, our corporate value may be impaired. •   Our credit portfolio may be adversely affected by the negative impact of climate change on our borrowers and transaction counterparties.

* These risk events are among the risk events that were reported to MUFG’s Board of Directors following the Risk Committee’s discussion in October 2023. These risk events include risk events of general applicability.

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3. Risks relating to reforms of London Interbank Offered Rate and other interest rate benchmarks

We have various transactions, including derivatives, loans, bonds, and securitized products, that reference or referenced London Interbank Offered Rate, or LIBOR, and other interest rate benchmarks. ICE Benchmark Administration Limited, the LIBOR administrator, ceased publication of the one-week and two-month U.S. dollar LIBOR settings and all non-U.S. dollar LIBOR settings on a representative basis after December 31, 2021 and publication of all other U.S. dollar LIBOR settings after June 30, 2023.

In preparation for the discontinuation of the publication of LIBOR, we have been taking measures to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, and our transition away from LIBOR and related benchmarks with respect to transactions referencing LIBOR settings which ceased to be published after December 31, 2021 have been mostly completed, with a strategy in place for the remainder of such transactions. With respect to transactions referencing U.S. dollar LIBOR settings and which ceased to be published after June 30, 2023, although we have made substantial progress on our transition away from such U.S. dollar LIBOR settings and related benchmarks, we continue to take measures to complete such transition, while relying on legislative solutions for existing contracts that cannot feasibly be transitioned away from U.S. dollar LIBOR.

Such transition from LIBOR and other interest rate benchmarks to alternative reference rates is complex and entails uncertainty, including as to the economic characteristics and performance, market acceptance, and accounting and regulatory treatment of such alternative reference rates and the transition to such rates, and may have various adverse impacts on our business, financial position and operating results. In particular, among other things,

• such transition may adversely affect the price, liquidity, profitability, and tradability of a wide range of financial instruments, such as loans and derivatives, included in our financial assets and liabilities that reference LIBOR and other interest rate benchmarks;

• we may be unable to modify contracts with our counterparties to replace the reference rate for existing contracts based on or linked to LIBOR and other interest rate benchmarks with alternative reference rates as planned;

• such transition may result in disputes with customers and counterparties concerning the interpretation of affected contracts or economic adjustments to the alternative reference rate adopted in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates, or disputes concerning inappropriate trade practices or abuse of a dominant bargaining position in transactions with customers;

• such transition may require us to respond to regulatory authorities in connection with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates; and

• our operational and risk management systems may not be fully effective to deal with the reform of LIBOR and other interest rate benchmarks and the transition to alternative reference rates.

19. Risks relating to regulatory changes

As a global financial services provider, our business is subject to ongoing changes in laws, regulations, rules, policies, accounting standards or methods, voluntary codes of practice and interpretations in Japan and other markets where we operate. Major global financial institutions currently face an increasingly stricter set of laws, regulations and standards as a result of emerging technologies, political and geopolitical developments, environmental, social and governance concerns, and other concerns enveloping the global financial sector. There is also growing political pressure to demand even greater internal compliance and risk management systems following several high-profile scandals and risk management failures in the financial industry and the resulting failures of financial institutions. The laws, regulations and standards that apply to us are often complex and, in many cases, we must make interpretive decisions regarding the application of such laws, regulations and standards to our business activities. Future developments or changes in laws, regulations, rules, policies, accounting standards or methods, voluntary codes of practice, interpretations and their effects are expected to require greater capital, human and technological resources as well as significant management attention, and may require us to modify our business strategies and plans. We may be unable to enhance our compliance management programs and systems, which, in some cases, are supported by third-party service providers, as required or planned. Our failure or inability to comply fully with applicable laws and regulations may lead to penalties, fines, public reprimands, damage to reputation, issuance of business improvement and other administrative orders, enforced suspension of operations, our inability to obtain regulatory approvals for future strategic initiatives or, in extreme cases, withdrawal of authorization to operate, adversely affecting our business and results of operations.

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Additional Japanese GAAP Financial Information for the Six Months Ended September 30, 2023

Consolidated Statements of Cash Flows

	(in millions of yen)
	For the six months ended September 30, 2022			For the six months ended September 30, 2023
Cash flows from operating activities:
Profits before income taxes		533,744			1,237,093
Depreciation and amortization		153,922			166,162
Impairment losses		6,838			23,778
Amortization of goodwill		10,223			9,542
Equity in losses (gains) of equity method investees		(239,246	)		(305,305	)
Increase (decrease) in allowance for credit losses		(105,504	)		77,770
Increase (decrease) in reserve for bonuses		(22,343	)		(62,000	)
Increase (decrease) in reserve for bonuses to directors		901			(2,281	)
Increase (decrease) in reserve for stocks payment		73			162
Decrease (increase) in net defined benefit assets		(51,197	)		(41,462	)
Increase (decrease) in net defined benefit liabilities		487			1,857
Increase (decrease) in reserve for retirement benefits to directors		(78	)		(88	)
Increase (decrease) in reserve for loyalty award credits		1,286			35
Increase (decrease) in reserve for contingent losses		(53,360	)		(25,884	)
Interest income recognized on statement of income		(2,363,604	)		(3,532,387	)
Interest expenses recognized on statement of income		690,489			2,302,876
Losses (gains) on securities		835,669			(80,574	)
Losses (gains) on money held in trust		4,655			20,458
Foreign exchange losses (gains)		(4,347,313	)		(4,095,844	)
Losses (gains) on sales of fixed assets		(2,611	)		(3,382	)
Net decrease (increase) in trading assets		(2,711,072	)		(3,676,840	)
Net increase (decrease) in trading liabilities		3,341,872			2,881,638
Adjustment of unsettled trading accounts		(18,001	)		1,054
Net decrease (increase) in loans and bills discounted		(6,628,012	)		(3,631,138	)
Net increase (decrease) in deposits		3,005,663			3,245,633
Net increase (decrease) in negotiable certificates of deposit		2,830,866			2,705,712
Net increase (decrease) in borrowed money (excluding subordinated borrowings)		(9,128,473	)		(134,182	)
Net decrease (increase) in call loans and bills bought and others		(1,569,474	)		(3,048,743	)
Net decrease (increase) in receivables under securities borrowing transactions		234,409			(329,808	)
Net increase (decrease) in call money and bills sold and others		6,734,093			(7,887,818	)
Net increase (decrease) in commercial papers		977,996			1,018,331
Net increase (decrease) in payables under securities lending transactions		(167,215	)		(178,229	)
Net decrease (increase) in foreign exchanges (assets)		(200,241	)		370,395
Net increase (decrease) in foreign exchanges (liabilities)		188,607			219,659
Net increase (decrease) in short-term bonds payable		(17,805	)		335,492
Net increase (decrease) in issuance and redemption of unsubordinated bonds payable		2,633,611			112,185
Net increase (decrease) in due to trust accounts		(3,685,153	)		(811,930	)
Interest income (cash basis)		2,322,079			3,446,753
Interest expenses (cash basis)		(577,003	)		(2,241,221	)
Others		126,512			(368,117	)
Sub-total		(7,253,710	)		(12,280,648	)
Income taxes		(330,717	)		(315,578	)
Refund of income taxes		32,644			57,676
Net cash provided by (used in) operating activities		(7,551,783	)		(12,538,550	)

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	(in millions of yen)
	For the six months ended September 30, 2022			For the six months ended September 30, 2023
Cash flows from investing activities:
Purchases of securities		(52,384,629	)		(45,306,613	)
Proceeds from sales of securities		29,517,679			35,726,086
Proceeds from redemption of securities		20,579,135			15,151,259
Payments for increase in money held in trust		(508,229	)		(769,255	)
Proceeds from decrease in money held in trust		486,619			656,904
Purchases of tangible fixed assets		(50,467	)		(51,146	)
Purchases of intangible fixed assets		(138,820	)		(172,625	)
Proceeds from sales of tangible fixed assets		20,575			41,098
Proceeds from sales of intangible fixed assets		12			568
Payments for acquisition of subsidiaries’ equity affecting the scope of consolidation		—			(79,841	)
Others		(1,979	)		(2,074	)
Net cash provided by (used in) investing activities		(2,480,103	)		5,194,360
Cash flows from financing activities:
Proceeds from subordinated borrowings		29,000			113,000
Proceeds from issuance of subordinated bonds payable and bonds with warrants		347,804			536,499
Payments for redemption of subordinated bonds payable and bonds with warrants		(240,074	)		(60,141	)
Proceeds from issuance of common stock to non-controlling shareholders		155			144
Repayments to non-controlling shareholders		—			(216	)
Dividends paid by MUFG		(183,336	)		(192,791	)
Dividends paid by subsidiaries to non-controlling shareholders		(20,049	)		(24,758	)
Purchases of treasury stock		(238,700	)		(15	)
Proceeds from sales of treasury stock		1,993			2,208
Payments for purchases of subsidiaries’ equity not affecting the scope of consolidation		(373	)		(1,592	)
Net cash provided by (used in) financing activities		(303,581	)		372,336
Effect of foreign exchange rate changes on cash and cash equivalents		1,952,849			1,962,511
Net increase (decrease) in cash and cash equivalents		(8,382,618	)		(5,009,342	)
Cash and cash equivalents at the beginning of the period		110,763,205			113,630,172
Increase in cash and cash equivalents resulting from inclusion of subsidiaries in consolidation		—			4,595
Decrease in cash and cash equivalents resulting from exclusion of subsidiaries from consolidation		(1,925	)		—
Cash and cash equivalents at the end of the period		102,378,661			108,625,425

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Additional Japanese GAAP Financial Information for the Six Months Ended September 30, 2023

1. Significant Accounting Policies Applied to the Semi-Annual Consolidated Financial Statements

I. Scope of consolidation

(1) Number of consolidated subsidiaries: 252

Principal companies:

MUFG Bank, Ltd.

Mitsubishi UFJ Trust and Banking Corporation

Mitsubishi UFJ Securities Holdings Co., Ltd.

Mitsubishi UFJ NICOS Co., Ltd.

ACOM CO., LTD.

(a) Changes in the scope of consolidation in the six months ended September 30, 2023

Kanmu, Inc. and twelve other companies were newly included in the scope of consolidation due to transfer from the scope of application of the equity method, acquisition of shares, or other reasons.

Otemachi Guarantee Co., Ltd. and six other companies were excluded from the scope of consolidation due to extinction through a merger or other reasons.

(2) Non-consolidated subsidiaries: None

(3) Entities not regarded as subsidiaries even though Mitsubishi UFJ Financial Group, Inc. (“MUFG”) owns the majority of voting rights in its own account:

Hygeia Co., Ltd.

HISHOH Biopharma Co., Ltd.

(a) Reasons for excluding from the scope of consolidation

These entities were not treated as subsidiaries because they were established as property management agents for land trust projects without any intent to control or because MUFG’s consolidated venture capital subsidiaries owned the majority of voting rights primarily to benefit from the appreciation of their investments resulting from growth or restructuring of the investees’ businesses without any intent to control.

II. Application of the equity method

(1) Number of non-consolidated subsidiaries accounted for under the equity method: None

(2) Number of equity method affiliates: 46

Principal companies:

Mitsubishi HC Capital Inc.

Morgan Stanley

(a) Changes in the scope of application of the equity method in the six months ended September 30, 2023

Groovenauts, Inc. and one other company were newly included in the scope of application of the equity method due to acquisition of shares or other reason.

Kanmu, Inc. and one other company were excluded from the scope of application of the equity method due to the transfer to the scope of consolidation or other reason.

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(3) Number of non-consolidated subsidiaries not accounted for under the equity method: None

(4) Number of affiliates not accounted for under the equity method: None

(5) Entities not regarded as affiliates in which MUFG owns 20% to 50% of their voting rights in its own account:

Hirosaki Co., Ltd.

Shonai Paradiso Co., LTD

Kamui Pharma Co., Ltd.

GEXVal Inc.

Alchemedicine, Inc.

DT Axis, Inc.

FELIQS CORPORATION

(a) Reasons for excluding from the scope of affiliates

These entities were not regarded as affiliates because MUFG’s consolidated venture capital subsidiaries owned 20% to 50% of voting rights primarily to benefit from the appreciation of their investments resulting from growth or restructuring of the investees’ businesses without any intent to control.

III. Semi-annual balance sheet dates of consolidated subsidiaries

(1) The semi-annual balance sheet dates of the consolidated subsidiaries were as follows:

The end of April:	1 subsidiary
The end of June:	182 subsidiaries
The end of September:	69 subsidiaries

(2) A subsidiary whose semi-annual balance sheet date is the end of April was consolidated based on its preliminary financial statements as of the end of July.

The remaining subsidiaries were consolidated based on their financial statements as of their respective semi-annual balance sheet dates.

Adjustments were made to the consolidated financial statements to reflect any significant transactions within the consolidated group that occurred between the semi-annual balance sheet dates of the relevant subsidiaries and the semi-annual consolidated balance sheet date.

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IV. Accounting policies

(1) Trading assets and Trading liabilities; Trading income and expenses

Transactions involving short-term fluctuations or arbitrage opportunities in interest rates, currency exchange rates, market prices of financial instruments or other market indices (“trading purposes”) are presented in “Trading assets” and “Trading liabilities” on the consolidated balance sheet on a trade-date basis, and gains and losses from trading transactions (interest and dividends, gains or losses on sales and gains or losses on valuation) are presented in “Trading income” and “Trading expenses” on the consolidated statement of income.

Trading assets and trading liabilities are stated at fair value as of the consolidated balance sheet date.

With respect to derivative transactions for trading purposes, specific market risk and counterparty credit risk exposures are measured in groups of trading assets and trading liabilities, and fair value is determined for each such group of trading assets and trading liabilities on a net basis.

(2) Securities

(a) Debt securities being held to maturity are stated at amortized cost (using the straight-line method) computed using the moving-average method. Available-for-sale securities are stated at their quoted market prices (cost of securities sold is calculated primarily using the moving-average method), and equity securities with no quoted market price available are stated at acquisition cost computed using the moving-average method.

Net unrealized gains (losses) on available-for-sale securities are included directly in net assets, net of applicable income taxes, except in the case of application of the fair value hedge accounting method, in which the change in the fair value recognized is recorded in current earnings.

(b) Securities included in trust assets in money held in trust are accounted for on the same basis as noted above in Notes (1) and (2)(a).

Net unrealized gains (losses) on securities in money held in trust which are not held for trading purposes or held to maturity are included directly in net assets, net of applicable income taxes.

(3) Derivatives

Derivative transactions (excluding those for trading purposes) are stated at fair value as of the consolidated balance sheet date.With respect to derivative transactions, specific market risk and counterparty credit risk exposures are measured in groups of trading assets and trading liabilities, and fair value is determined for each such group of trading assets and trading liabilities on a net basis.

(4) Depreciation and amortization of fixed assets

(a) Tangible fixed assets (except for lease assets)

Depreciation of tangible fixed assets of MUFG and its domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries is computed primarily using the declining-balance method, and is recorded by allocating the estimated annual depreciation amount evenly to each reporting period. The useful lives are primarily estimated as follows:

Buildings: 15 to 50 years

Equipment: 2 to 20 years

Depreciation of tangible fixed assets of other consolidated subsidiaries is computed primarily using the straight-line method based on their estimated useful lives and other factors.

(b) Intangible fixed assets (except for lease assets)

Amortization of intangible fixed assets is computed using the straight-line method.

Development costs for internally used software are amortized using the straight-line method over the estimated useful lives of primarily 3 to 10 years.

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(c) Lease assets

Depreciation or amortization of lease assets in “Tangible fixed assets” or “Intangible fixed assets” under finance leases other than those that are deemed to transfer the ownership of leased property to the lessees is computed using the straight-line method over the lease periods with zero residual value unless residual value is guaranteed by the corresponding lease contracts, in which case the residual value equals the guaranteed amount.

(5) Deferred assets

Bond issuance costs and stock issuance costs are expensed as incurred.

(6) Allowance for credit losses

Principal domestic consolidated subsidiaries determine the amount of allowance for credit losses in accordance with the internal standards for self-assessment of asset quality and the internal standards for write-offs and provisions.

For claims on borrowers that have entered into bankruptcy, special liquidation proceedings or similar legal proceedings or whose notes have been dishonored and suspended from processing through clearing houses (“bankrupt borrowers”) or borrowers that are not legally or formally bankrupt but are regarded as substantially in similar condition (“virtually bankrupt borrowers”), allowances are provided based on the amount of claims, after the write-offs as stated below, net of expected amounts to be collected through the disposal of collateral and the execution of guarantees.

For claims on borrowers that are not yet legally or formally bankrupt but deemed to have a high possibility of becoming bankrupt (“likely to become bankrupt borrowers”), where the amounts of principal repayments and interest payments cannot be reasonably estimated from the borrowers’ cash flows, allowances are provided based on an overall solvency assessment of the claims, net of expected amounts to be collected through the disposal of collateral and the execution of guarantees.

For claims on likely to become bankrupt borrowers and claims on borrowers requiring close monitoring, where the amounts of principal repayments and interest payments can be reasonably estimated from the borrowers’ cash flows, allowances are provided in an amount equal to the difference between the book value of the claims and the relevant cash flows discounted by the initial contractual interest rates.

For other claims, allowances are provided based mainly on expected losses for the immediately following one-year period or the average remaining term to maturity of loans. Expected losses are calculated by applying a loss rate, which is obtained based on the average rate of historical credit loss experience or historical default probability experience over a certain period, which is derived from actual credit losses or actual defaults over a one-year period or over a period equal to the average remaining term to maturity of loans, with necessary adjustments for future loss projections and other factors.

For claims originated in certain foreign countries, additional allowances are provided based on an assessment of political and economic conditions of these countries.

All claims are assessed by the relevant branches and the credit supervision departments in accordance with the internal standards for self-assessment of asset quality. The credit review department, which is independent from those operating sections, subsequently audits these assessments.

For claims on bankrupt borrowers and virtually bankrupt borrowers, the amount of claims exceeding the estimated value of collateral and guarantees, which is deemed uncollectible, is written off. The total amount of write-offs was ¥225,101 million as of September 30, 2023(¥216,625 million as of March 31, 2023).

Consolidated subsidiaries not adopting the procedures stated above provide for allowances based on their historical credit loss experience or other factors for collectively assessed claims and based on individual assessments of the possibility of collection for specific deteriorated claims.

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(Additional Information)

(Allowance for credit losses of certain overseas subsidiaries which apply Generally Accepted Accounting Principles in the United States (“U.S. GAAP”))

Certain overseas subsidiaries which apply U.S. GAAP have adopted U.S. Accounting Standards Codification (“ASC”) Topic 326, “Financial Instruments—Credit losses,” provide for allowance for credit losses by estimating credit losses currently expected for the remaining term of the relevant contract. Expected credit losses are calculated collectively for each portfolio of loans with similar risk characteristics based on the loss rates derived from past credit loss experience or bankruptcy experience through the application of a model that incorporates future forecast information, such as macroeconomic variables, into the probability of bankruptcy, etc. In addition, adjustments are made in the calculation of allowance for credit losses for qualitative factors relating to current conditions and future forecasts which may not be sufficiently captured in such model but should be appropriately taken into account.

With respect to loan assets with deteriorated credit risk that are deemed not to entail risks in common with other loan assets, allowance for credit losses is recognized individually for each loan asset based on risks that are particular to the asset. This credit loss provisioning is done through certain methodologies, including calculating the difference between the carrying amount of the loan asset and the amount of estimated cash flows from the loan asset discounted by the effective interest rate as well as using the fair value of the collateral for the loan asset.

(Information relevant to an understanding by readers of the consolidated financial statements regarding the calculation of allowance for credit losses)

The process of calculating allowance for credit losses in our principal consolidated domestic banking subsidiaries involves various estimates such as determination of counterparty credit ratings which are based on evaluation and classification of counterparties’ debt-service capacity, assessment of the value of collateral provided by borrowers, and adjustments for future loss projections and other factors to the loss rates calculated based on historical credit loss experience.

Among these, internal credit ratings are assigned to counterparties based on qualitative factors such as the current and expected future business environment of the industry to which they belong as well as their management and funding risks in addition to quantitative financial evaluations through an analysis of their financial results. In particular, Determination of internal credit ratings for some counterparties may be highly dependent on our assessment of the prospects of improvements in their operating results and their ability to continue as going concerns.

When calculating allowance for credit losses, MUFG Bank, Ltd., our principal consolidated domestic banking subsidiary, determines expected loss rates primarily by calculating a rate of loss based on a historical average of the credit loss rate or a historical average of the default probability derived from actual credit loss experience or actual bankruptcy experience and making necessary adjustments based on future projections and other factors. The subsidiary makes such adjustments based on future loss projections and other factors to loss rates calculated based on historical loss experience, when and to the extent such adjustments are deemed appropriate, by taking into account additional expected losses that are not reflected in such loss rates calculated based on historical loss experience and other factors, especially in light of the Russia-Ukraine situation. The amount of impact of these adjustments was ¥63,094 million as of September 30, 2023 (¥69,569 million as of March 31, 2023).

Given that actual loss information after the expansion of COVID-19 has been accumulated and the impact of COVID-19 is reflected in the loss rates calculated based on historical loss experience, starting in the current semi-annual reporting period, no adjustment are made based on future projections that take into account the rate of increase in the credit loss rate or the default probability in a recent period.

In addition, certain overseas subsidiaries which apply Generally Accepted Accounting Principles in the United States (“U.S. GAAP”) have adopted Accounting Standards Codification Topic 326, “Financial Instruments—Credit losses,” provide for allowance for credit losses by estimating credit losses currently expected for the remaining term of the relevant contracts. Expected credit losses are calculated using a quantitative model that reflects economic forecast scenarios based on macroeconomic variables. The calculation process includes determination of macroeconomic variables used in multiple economic forecast scenarios and the weightings applied to each economic forecast scenario. Expected credit losses are adjusted for qualitative factors to compensate for expected credit losses that are not reflected in a quantitative model.

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Significant assumptions used in our calculation of allowance for credit losses, including those described above, are subject to uncertainty. In particular, some counterparties’ prospects of improvements in their operating results and expectations as to their ability to continue as going concerns, and adjustments to the rate of loss calculated based on actual experience for future projections and other factors, as well as determination of the macroeconomic variables used in, and the weightings applied to, multiple economic forecast scenarios, and adjustments thereto for qualitative factors, by certain subsidiaries which apply U.S. GAAP, are based on estimation relating to factors with respect to which objective data are not readily available such as changes in the economic environment, commodity prices, monetary policy and geopolitical situation in each country.

In particular, the outlook relating to the Russia-Ukraine situation remains subject to significant uncertainty. Accordingly, we make certain assumptions, including that the current Russia-Ukraine situation will remain for some time. The recorded allowance for credit losses represents our best estimation made in a manner designed to ensure objectivity and rationality.

For the six-month period ended September 30, 2023, the assumptions for making estimates relating to allowance for credit losses remained substantially unchanged because the observable changes subsequent to the end of the previous fiscal year in the factors and circumstances underlying the outlook relating to the Russia-Ukraine situation were not sufficiently significant to cause such change in the assumptions. However, these assumptions are highly uncertain, and significant additional provision for credit losses may be recognized for the nine-month period ending December 31, 2023 and subsequent reporting periods due to these and other factors and circumstances affecting the financial performance of counterparties or the economic environment.

(7) Reserve for bonuses

Reserve for bonuses, which is provided for future bonus payments to employees, is recorded in the amount deemed to have accrued based on the estimated amount of bonuses as of the consolidated balance sheet date.

(8) Reserve for bonuses to directors

Reserve for bonuses to directors, which is provided for future bonus payments to directors, is recorded in the amount deemed to have accrued based on the estimated amount of bonuses as of the consolidated balance sheet date.

(9) Reserve for stocks payment

Reserve for stocks payment, which is provided for future payments of compensation under the stock compensation plan for directors and officers of MUFG and certain domestic consolidated subsidiaries, is recorded in the amount deemed to have accrued based on the estimated amount of compensation as of the consolidated balance sheet date.

(10) Reserve for retirement benefits to directors

Reserve for retirement benefits to directors, which is provided for future payments of retirement benefits to directors of consolidated subsidiaries, is recorded in the amount deemed to have accrued based on the estimated amount of benefits as of the consolidated balance sheet date.

(11) Reserve for loyalty award credits

Reserve for loyalty award credits, which is provided for the future redemption of points awarded to customers of certain consolidated subsidiaries, is calculated by estimating the amount that will be redeemed in the future based on the monetary amount converted from the awarded but unused points, and is recorded in the appropriate amount as a reserve.

(12) Reserve for contingent losses

Reserve for contingent losses, which is provided for possible losses from contingent events related to off-balance sheet transactions and various litigation and regulatory matters, is calculated by estimating the impact of such contingent events. This reserve also includes future claims for repayment of excess interest payments on consumer loans that are estimated based on the past repayments, the pending claims and other factors.

10

(13) Reserves under special laws

Reserves under special laws represent the reserves for contingent liabilities from derivative financial instruments transactions executed for clients, which are recorded in accordance with Article 46-5-1 of the Financial Instruments and Exchange Law and Article 175 of the Cabinet Office Ordinance on Financial Instruments Business.

(14) Retirement benefits

In calculating the amount of benefit obligation, the portion of projected benefit obligation attributed to the six-month period ended September 30, 2023 is determined using the benefit formula basis.

Prior service cost is amortized using the straight-line method over a fixed period, primarily over 10 years, within the employees’ average remaining service period.

Net actuarial gains (losses) are amortized using the straight-line method over a fixed period, primarily over 10 years, within the employees’ average remaining service period, primarily beginning in the subsequent fiscal year after such gains (losses) are recognized.

For certain overseas branches of domestic consolidated subsidiaries and certain consolidated subsidiaries, net defined benefit liability and retirement benefit expenses are calculated using the simplified method.

(15) Revenue Recognition

(a) Revenue recognition

Revenues arising from contracts with customers are recognized in the consolidated statements of income based on the status of fulfillment of the performance obligations identified in each contract, depending on the actual nature of the transactions under the contract.

(b) Revenue Recognition for Principal Categories of Transactions

Revenue arising from contracts with customers is recognized using a method that is designed to closely reflect economic reality, with the timing of fulfillment of performance obligations, which is an important factor in determining the timing of revenue recognition, assessed as described below.

In most cases, the consideration for a transaction is settled in cash at the time of the transaction. In other cases, receivables recognized in connection with transactions are generally collected within one year.

Of the fees and commissions, those on remittances and transfers consist mainly of remittance and transfer fees and are recognized as revenue at the time of settlement.

Of the fees and commissions, those on deposits consist mainly of ATM usage fees and periodic account management service fees. ATM usage fees are recognized as revenue at the time of execution of transactions, and periodic account management service fees are recorded as revenue over the service period.

Of the fees and commissions, those on loans consist mainly of the consideration for administration and management services during the tenors of syndicated loans and the consideration for financial and financing advice to clients, and are recorded as revenue over the service period.

Of the fees and commissions, those on trust-related services consist mainly of the consideration for shareholder registry administration services for issuers of stocks, real estate brokerage and appraisal services, and succession services including preparation, maintenance and execution of wills and inheritance management. These fees and commissions are recognized as revenue at the time when the services are provided.

11

Of the fees and commissions, those on securities-related services consist mainly of fees related to sales and transfers of securities including investment trust, underwriting, brokerage and advisory services, fees related to securitization, and agent fees related to calculation and payment of dividends. Fees on securities-related services are recorded as revenue over the relevant service period. Fees arising from securities-related services that are consumed by a client at a point in time (e.g., sales and transfers of securities executed under the direction of clients, underwriting or securitization of bonds and equity securities which is completed on the date of the transaction, provision of advice to clients, and calculation and payment to investors of dividends) are recognized as revenue at such point in time. Fees arising from securities-related services that are used by a client at equal intervals over the service period (e.g., retainer fees for M&A advisory services) are recognized as revenue over such service period. Fees to be paid when a particular performance target is achieved (e.g., success fees for M&A advisory services) are recognized as revenue at the time when such performance target is achieved.

Of the fees and commissions, those on credit card business consist mainly of credit card merchant fees and royalty fees from franchised merchants. Merchant fees are recorded as revenue at the time when the credit sale data is received, and royalty fees from franchised merchants are recorded as revenue over the service period.

Of the fees and commissions, those on administration and management services for investment funds and investment advisory services arise mainly from asset management and investment advisory services and consist of asset management fees, success fees and investment advisory fees related to investment trusts. Asset management fees and investment advisory fees are recognized as revenue as MUFG’s performance obligations are satisfied over the service period in the amount MUFG is entitled to charge based on the balance of assets under management. Performance-based success fees are recognized as revenue at the time when performance targets are met and it is deemed highly likely that there will be no material reversal of the recognized revenue.

Trust fees consist mainly of fees on administration and management of trust assets and are recognized as revenue as MUFG’s performance obligations are satisfied over the service period in the amount MUFG is entitled to charge based generally on the balance of assets under management for each trust or the performance of each trust account for an accounting period.

(16) Translation of assets and liabilities denominated in foreign currencies

Assets and liabilities denominated in foreign currencies or booked at overseas branches of domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries are translated into yen primarily at exchange rates prevailing at the consolidated balance sheet date, except for investments in non-consolidated affiliates which are translated into yen at exchange rates prevailing at the acquisition dates.

Assets and liabilities denominated in foreign currencies of other consolidated subsidiaries are translated into yen at exchange rates prevailing at the respective balance sheet date.

(17) Leasing transactions

(As Lessees)

Domestic consolidated subsidiaries’ finance leases other than those that are deemed to transfer the ownership of leased property to the lessees are accounted for in a similar way to purchases, and depreciation of lease assets is computed using the straight-line method over the lease term with zero residual value unless residual value is guaranteed by the corresponding lease contracts, in which case the residual value equals the guaranteed amount.

(As Lessors)

Finance leases other than those that are deemed to transfer the ownership of leased property to the lessees are accounted for in a similar way to sales and income and expenses related to such leases are recognized by allocating interest equivalents to applicable fiscal periods instead of recording sales as “Other ordinary income.”

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(18) Hedge accounting

(a) Hedge accounting for interest rate risks

Domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries have adopted the deferred hedge accounting method for hedging transactions to hedge interest rate risks arising from financial assets and liabilities, except for certain transactions qualifying for special hedge accounting treatment of interest rate swaps. Portfolio hedging or individual hedging, as described in the Japanese Institute of Certified Public Accountants (“JICPA”) Industry Committee Practical Guidelines No. 24, “Treatment of Accounting and Auditing of Application of Accounting Standard for Financial Instruments in Banking Industry” (March 17, 2022), and JICPA Accounting Committee Report No. 14, “Practical Guidelines for Accounting for Financial Instruments” (January 31, 2000), is primarily applied to determine hedged items.

With respect to hedging transactions to offset fluctuations in the fair value of fixed rate deposits, loans and other instruments, hedging instruments (e.g., interest rate swaps) are designated to hedged items individually or collectively by their maturities in accordance with JICPA Industry Committee Practical Guidelines No. 24. With respect to hedging transactions to offset fluctuations in the fair value of fixed rate bonds classified as available-for-sale securities, hedging instruments (e.g., interest rate swaps) are designated to hedged items collectively by the type of bond. Since material terms related to hedged items and hedging instruments are substantially identical, and such hedging transactions are deemed highly effective, the assessment of effectiveness is based on the similarity of the terms.

With respect to hedging transactions to fix the cash flows of forecasted transactions related to floating rate deposits, loans and other instruments as well as forecasted transactions related to short-term fixed rate deposits, loans and other instruments, hedging instruments (e.g., interest rate swaps) are designated to hedged items collectively by interest rate indices and tenors in accordance with JICPA Industry Committee Practical Guidelines No. 24. Since material terms related to hedged items and hedging instruments are substantially identical, and such hedging transactions are deemed highly effective, the assessment of effectiveness is based on the similarity of the terms. The effectiveness of hedging transactions is also assessed by the correlation between factors that cause fluctuations in interest rates of hedged items and those of hedging instruments.

(b) Hedge accounting for foreign currency risks

Domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries have adopted the deferred hedge accounting method for hedging foreign currency risks arising from financial assets and liabilities denominated in foreign currencies, except for certain transactions qualifying for the allocation method applicable to forward exchange contracts and other contracts. Portfolio hedging is applied to determine hedged items as described in JICPA Industry Committee Practical Guidelines No. 25 “Treatment of Accounting and Auditing concerning Accounting for Foreign Currency Transactions in the Banking Industry” (October 8, 2020). Hedging instruments (e.g., currency swaps and forward exchange contracts) are designated to hedged items collectively by currencies.

Portfolio hedging or individual hedging is applied to hedge foreign currency risks arising from equity investments in foreign subsidiaries and foreign affiliates and from available-for-sale securities (other than bonds) denominated in foreign currencies as well as from future equity investments in foreign subsidiaries. Monetary claims and liabilities denominated in the same foreign currencies or forward exchange contracts are used as hedging instruments. As for the hedge accounting method applied to equity investments in foreign subsidiaries and foreign affiliates, foreign currency translation differences arising from hedging instruments are recorded as foreign currency translation adjustments. The fair value hedge accounting method is applied to available-for-sale securities (other than bonds) denominated in foreign currencies, and the deferred hedge accounting method is applied to future equity investments in foreign subsidiaries.

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(c) Hedge accounting for stock price fluctuation risks

Individual hedging is applied to hedge market fluctuation risks arising from strategic equity securities held by domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries. Instruments such as total return swaps are used as hedging instruments. The effectiveness of hedging transactions is assessed by the correlation between changes in the fair value of hedged items and changes in the fair value of hedging instruments. The fair value hedge accounting method is applied.

(d) Transactions among consolidated subsidiaries

Derivative transactions including interest rate swaps and currency swaps which are designated as hedging instruments among consolidated subsidiaries or between trading accounts and other accounts (or among internal sections) are not eliminated from the consolidated statements of income or valuation difference, but are recognized as related gains or losses or deferred under hedge accounting because these derivative transactions meet non-arbitrariness and certain other criteria under JICPA Industry Committee Practical Guidelines No. 24 and No. 25 and are regarded as equivalent to external third-party cover transactions.

(19) Cash and cash equivalents in the consolidated statements of cash flows

Cash and cash equivalents in the consolidated statements of cash flows are defined as “Cash and due from banks” on the consolidated balance sheet.

(20) Consumption taxes

National and local consumption taxes are primarily excluded from transaction amounts of MUFG and its domestic consolidated subsidiaries. Non-deductible portions of consumption taxes on the purchases of tangible fixed assets are expensed when incurred.

(21) Adoption of the Group Tax Sharing System

MUFG and some of its domestic consolidated subsidiaries have adopted the group tax sharing system.

(22) Accounting of bills discounted and rediscounted

Bills discounted and rediscounted are accounted for as financial trading in accordance with JICPA Industry Committee Practical Guidelines No. 24.

(23) Accounting standards for foreign subsidiaries

If the financial statements of foreign subsidiaries are prepared in accordance with the International Financial Reporting Standards (“IFRS”) or U.S. GAAP, such financial statements are used in the consolidated accounting process.

If the financial statements of foreign subsidiaries are prepared in accordance with generally accepted accounting principles in each domicile country and not in accordance with IFRS or U.S. GAAP, the financial statements of foreign subsidiaries are mainly rearranged in accordance with U.S. GAAP.

Adjustments are also made when necessary in the consolidated accounting process.

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(Additional Information)

(Provisional closing of accounts of a significant equity-method affiliate)

Morgan Stanley, a significant equity-method affiliate of MUFG, closes its financial accounts based on a fiscal year-end of December 31 and, previously, the equity method of accounting was applied to Morgan Stanley’s consolidated financial statements as of the end of Morgan Stanley’s quarterly reporting period. However, from the perspective of providing financial information in a more timely manner, MUFG has decided to make modifications so that, effective from the semi-annual reporting period ended September 30, 2023, the equity method of accounting will be applied to Morgan Stanley based on a provisional closing of accounts to be implemented as of September 30, which is the end of MUFG’s semi-annual reporting period.

Accordingly, for the semi-annual reporting period ended September 30, 2023, the equity method of accounting have been applied to Morgan Stanley’s consolidated financial statements for the nine-month period from January 1, 2023 to September 30, 2023 based on a provisional closing of accounts, and the impact of implementation of such provisional closing of accounts has been reflected in MUFG’s consolidated financial statements for the semi-annual reporting period ended September 30, 2023.

For the period from January 1, 2023 to March 31, 2023, equity in earnings of the equity method investees related to Morgan Stanley is 104,850 million, losses on change in equity related to Morgan Stanley is 22,058 million, and share of other comprehensive income of associates accounted for using equity method related to Morgan Stanley included in other comprehensive income is 367,925 million.

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2. Consolidated Balance Sheets

I. Equity securities and other capital investments in affiliates

	(in millions of yen)
	March 31, 2023		September 30, 2023
Equity securities in affiliates	¥	3,757,973	¥	4,259,046
Other capital investments in affiliates		43,571		60,545

The amount of investments in jointly controlled companies included in the amounts in the above table was as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Investments in jointly controlled companies	¥	5,956	¥	6,923

II. Securities loaned under unsecured and secured securities lending transactions included in “Securities” and “Monetary claims bought”.

	(in millions of yen)
	March 31, 2023		September 30, 2023
Securities loaned under unsecured and secured securities lending transactions	¥	87,730	¥	92,110

Securities borrowed under securities borrowing transactions and securities purchased under resale agreements where the borrowers or purchasers have the right to dispose of the securities through sale or re-pledging without any restrictions

	(in millions of yen)
	March 31, 2023		September 30, 2023
Securities re-pledged	¥	16,534,808	¥	15,164,107
Securities re-loaned		2,597,315		3,503,584
Securities held without disposition		6,465,540		10,776,061

Bank acceptance bills discounted, commercial bills discounted, and foreign currency bills bought discounted with the right to dispose of the bills discounted through sale or re-pledging without any restrictions

	(in millions of yen)
	March 31, 2023		September 30, 2023
Bills discounted (face value)	¥	1,114,509	¥	923,759

Foreign currency bills bought which were re-discounted upon transfer

	(in millions of yen)
	March 31, 2023		September 30, 2023
Foreign currency bills re-discounted (face value)	¥	8,289	¥	3,079

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III. Loans to be disclosed under the Banking Act and the Financial Reconstruction Act (the “FRA”) were as follows. Disclosed loans include corporate bonds included in Securities (to the extent that such bonds were issued through private placements as stipulated in Article 2-3 of the Financial Instruments and Exchange Act and that the principal of and interest on such bonds are partly or fully guaranteed by MUFG), Loans and bills discounted, Foreign exchanges, accrued interest and suspense payments included in Other assets, and Customers’ liabilities for acceptances and guarantees, each as included in the consolidated balance sheets, and securities loaned (to the extent borrowers have the right to sell or pledge such securities) as included in the notes to the consolidated balance sheets.

	(in millions of yen)
	March 31, 2023		September 30, 2023
Bankrupt or De facto Bankrupt	¥	198,312	¥	205,068
Doubtful	¥	746,207	¥	695,488
Special Attention	¥	618,892	¥	633,663
Accruing loans contractually past due 3 months or more	¥	23,679	¥	26,219
Restructured loans	¥	595,212	¥	607,443
Subtotal	¥	1,563,411	¥	1,534,219
Normal	¥	121,766,210	¥	126,874,902
Total	¥	123,329,622	¥	128,409,121

Bankrupt or De facto Bankrupt represents loans to borrowers that are bankrupt or in substantially similar condition due to reasons including a petition being filed to commence bankruptcy, reorganization or rehabilitation proceedings.

Doubtful represents loans to borrowers that are not yet in a state of bankruptcy but that are in deteriorated financial condition, with deteriorated operating results, and with a high likelihood of loan principal and interest not being collected or received in accordance with contractual terms, other than loans included in the Bankrupt or De facto Bankrupt category.

Accruing loans contractually past due 3 months or more represent loans with respect to which principal repayments or interest payments have been past due for 3 months or more, other than loans included in the Bankrupt or De facto Bankrupt category or the Doubtful category.

Restructured loans represent loans that have been modified with concessionary terms, including interest rate reductions, deferral of interest payments, deferral of principal repayments, waivers of loan claims and other renegotiated terms, that are favorable to borrowers, for the purpose of assisting such borrowers in improving their financial condition, other than loans included in the Bankrupt or De facto Bankrupt category, the Doubtful category or the Accruing loans contractually past due 3 months or more category.

Normal represents loans with no particular issues identified in terms of the financial condition and results of operations of borrowers and thus not included in the Bankrupt or De facto Bankrupt category, the Doubtful category, the Accruing loans contractually past due 3 months or more category or the Restructured loan category.

The amounts provided in the table above represent gross amounts before deduction of allowance for credit losses.

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IV. Assets pledged as collateral

Assets pledged as collateral and their relevant liabilities as of March 31, 2023 and September 30, 2023 were as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Assets pledged as collateral:
Cash and due from banks	¥	5,020	¥	5,222
Trading assets		303,918		253,065
Securities		9,959,654		9,946,823
Loans and bills discounted		11,806,356		12,060,303
Other assets		191		884
Tangible fixed assets		4,635		4,541
Total	¥	22,079,777	¥	22,270,840
Relevant liabilities to above assets:
Deposits	¥	13,900	¥	13,900
Borrowed money		21,962,993		22,155,150
Bonds payable		24,574		24,561
Other liabilities		4,618		3,568

In addition to the above, the following assets were pledged as collateral for cash settlements and other transactions or as deposits for margin accounts for futures and other transactions:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Cash and due from banks	¥	33,382	¥	—
Monetary claims bought		33,093		37,090
Trading assets		1,668,783		2,231,249
Securities		16,367,312		16,488,614
Loans and bills discounted		1,904,568		2,434,292

Furthermore, the following assets were sold under repurchase agreements or loaned under securities lending transactions with cash collateral as of March 31, 2023 and September 30, 2023:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Monetary claims bought	¥	—	¥	53,722
Trading assets		1,750,274		2,473,387
Securities		23,442,434		14,662,839
Total	¥	25,192,709	¥	17,189,949
Relevant liabilities to above assets:
Payables under repurchase agreements	¥	25,934,089	¥	18,996,525
Payables under securities lending transactions		565,888		213,948

In addition, the following assets were pledged under general collateral repurchase agreements using the subsequent collateral allocation method as of March 31, 2023 and September 30, 2023:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Trading assets	¥	1,131,433	¥	1,053,719
Securities		1,668,012		2,580,728
Total	¥	2,799,446	¥	3,634,447

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V. Non-recourse debt of consolidated special purpose companies was as follows.

	(in millions of yen)
	March 31, 2023		September 30, 2023
Non-recourse debt
Borrowed money	¥	2,100	¥	2,100
Bonds payable		9,074		8,726
Relevant assets to above non-recourse debt:
Cash and due from banks	¥	1,072	¥	867
Securities		8,958		8,691
Loans and bills discounted		20,000		20,000
Other assets		191		198
Tangible fixed assets		4,635		4,541

The above table includes certain assets reported in the immediately preceding Item IV.

VI. Overdraft facilities and commitment lines of credit are binding contracts under which MUFG’s consolidated subsidiaries have obligations to disburse funds up to predetermined limits upon the borrower’s request as long as there has been no breach of contracts. The total amount of the unused portion of these facilities as of March 31, 2023 and September 30, 2023 was as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Unused overdraft facilities and commitment lines of credit	¥	96,203,085	¥	100,195,295

The total amount of the unused portion does not necessarily represent actual future cash requirements because many of these contracts are expected to expire without being drawn upon. In addition, most of these contracts include clauses that allow MUFG’s consolidated subsidiaries to decline a borrower’s request for disbursement or decrease contracted limits for cause, such as changes in financial market condition or deterioration in a borrower’s creditworthiness. MUFG’s consolidated subsidiaries may request a borrower to pledge real property and/or securities as collateral upon signing of a contract and will perform periodic monitoring on a borrower’s business condition in accordance with internal procedures, which may lead to renegotiation of the terms and conditions of the contracts and/or initiation of a request for additional collateral and/or guarantees.

VII. The amount of assets that belonged to the declaration of trust for which a domestic trust banking subsidiary was the settlor and the trustee was as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Loans and bills discounted	¥	259,749	¥	268,613

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VIII. In accordance with the “Law concerning Revaluation of Land” (the “Land Revaluation Law”) (No. 34, March 31, 1998), land used for business operations of domestic consolidated banking subsidiaries and domestic consolidated trust banking subsidiaries has been revalued as of the dates indicated below. The total excess from revaluation, net of income taxes corresponding to the excess that were recognized as “Deferred tax liabilities for land revaluation,” is stated as “Land revaluation excess” in net assets. Land revaluation excess includes MUFG’s share of affiliated companies’ Land revaluation excess.

Dates of revaluation:

Domestic consolidated banking subsidiaries: March 31, 1998.

Domestic consolidated trust banking subsidiaries: March 31, 1998, December 31, 2001 and March 31, 2002.

The method of revaluation as set forth in Article 3, Paragraph 3 of the Land Revaluation Law:

Fair values are determined based on (1) “published land price under the Land Price Publication Law” stipulated in Article 2-1 of the “Enforcement Ordinance of the Law concerning Revaluation of Land” (“Ordinance”) (No. 119, March 31, 1998), (2) “standard land price determined on measurement spots under the Enforcement Ordinance of the National Land Planning Law” stipulated in Article 2-2 of the Ordinance, (3) “land price determined by the method established and published by the Director General of the National Tax Agency in order to calculate land value that is used for determining taxable amounts subject to landholding tax articulated in Article 16 of the Landholding Tax Law” stipulated in Article 2-4 of the Ordinance with price adjustments for shape and time and (4) appraisal by certified real estate appraisers stipulated in Article 2-5 of the Ordinance with price adjustments for time.

In addition, some of MUFG’s affiliates that were accounted for under the equity method conducted a revaluation for land used for business operations on March 31, 2002.

IX. Accumulated depreciation on tangible fixed assets

	(in millions of yen)
	March 31, 2023		September 30, 2023
Accumulated depreciation on tangible fixed assets	¥	1,082,897	¥	1,100,796

X. Subordinated borrowings with special contractual provisions which rank below other debts with regard to the fulfillment of obligations included in “Borrowed money”

	(in millions of yen)
	March 31, 2023		September 30, 2023
Subordinated borrowings	¥	260,500	¥	373,500

XI. Subordinated bonds included in “Bonds payable”

	(in millions of yen)
	March 31, 2023		September 30, 2023
Subordinated bonds	¥	3,637,670	¥	4,136,139

XII. The principal amount of money trusts entrusted to domestic trust banking subsidiaries for which repayment of the principal to the customers was guaranteed

	(in millions of yen)
	March 31, 2023		September 30, 2023
Principal-guaranteed money trusts	¥	6,408,838	¥	6,988,734

XIII. Guarantee obligations for private placement bonds (provided in accordance with the Article 2-3 of the Financial Instruments and Exchange Law) among the bonds and other securities included in “Securities”

	(in millions of yen)
	March 31, 2023		September 30, 2023
Guarantee obligations for private placement bonds	¥	313,903	¥	337,657

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XIV. Contingent liabilities

(Litigation)

In the ordinary course of business, MUFG is subject to various litigation and regulatory matters. In accordance with applicable accounting guidance, MUFG establishes a Reserve for Contingent Losses arising from litigation and regulatory matters when they are determined to be probable in their occurrences and the probable loss amount can be reasonably estimated. Based upon current knowledge and consultation with counsel, management believes the eventual outcome of such litigation and regulatory matters, where losses are probable and the probable loss amounts can be reasonably estimated, would not have a material adverse effect on MUFG’s financial position, results of operations or cash flows.

Management also believes the amount of loss that is reasonably possible, but not probable, from various litigation and regulatory matters is not material to MUFG’s financial position, results of operations or cash flows.

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3. Consolidated Statements of Income

I. “Other ordinary income” for the periods indicated included the following:

	(in millions of yen)
	For the six months ended September 30,
	2022		2023
Equity in earnings of the equity method investees	¥	239,246	¥	305,305
Gains on sales of equity securities		147,037		143,104

II. “General and administrative expenses” for the periods indicated included the following:

	(in millions of yen)
	For the six months ended September 30,
	2022		2023
Personnel expenses	¥	660,222	¥	663,683
Depreciation and amortization		153,922		166,162

III. “Other ordinary expenses” for the periods indicated included the following:

	(in millions of yen)
	For the six months ended September 30,
	2022		2023
Provision for allowance for credit losses	¥	14,310	¥	149,479
Write-offs of loans		294,116		75,970
Write-offs of equity securities		55,507		4,268

IV. (Additional information)

In connection with the planned sale of the shares in MUFG Union Bank, N.A. (hereinafter referred to as “MUB”), MUFG Americas Holdings Corporation recognized an aggregate of ¥631,861 million of losses for the six months ended June 30, 2022, primarily in accordance with ASC Topic 326, “Financial Instruments—Credit losses,” and ASC Topic 310, “Receivables.” The aggregate losses reflected ¥385,215 million of valuation losses related to securities held for sale recorded as Other operating expenses and ¥232,571 million of valuation losses related to loans held for sale recorded as Other ordinary expenses.

22

4. Consolidated Statements of Changes in Net Assets

For the six months ended September 30, 2022

I. Information on the class and number of issued shares and treasury stock

	(Thousand shares)
	Number of shares as of April 1, 2022		Number of shares increased		Number of shares decreased		Number of shares as of September 30, 2022		Note
Issued shares:
Common stock		13,281,995		—		—		13,281,995
Total		13,281,995		—		—		13,281,995
Treasury stock:
Common stock		667,296		327,308		2,912		991,692		(Notes 1 and 2)
Total		667,296		327,308		2,912		991,692

(Notes)

1. The increase in the number of shares of common stock held in treasury by 327,308 thousand shares was due to the acquisitions of shares pursuant to provisions of the Articles of Incorporation and the repurchases of shares in response to requests made by shareholders holding shares constituting less than one whole unit. The decrease in the number of shares of common stock held in treasury by 2,912 thousand shares was due to the sale of shares for a performance-based director and officer stock compensation plan using a Board Incentive Plan trust (“BIP trust”), the sale of shares in response to requests made by shareholders holding shares constituting less than one whole unit and a decrease in the number of shares held by equity method affiliates.

2. The number of shares of common stock held in treasury as of April 1, 2022 and September 30, 2022 includes 31,660 thousand shares and 28,749 thousand shares held by the BIP trust, respectively. For the six months ended September 30, 2022, the number of shares held by the BIP trust decreased by 2,911 thousand shares.

II. Information on share subscription rights

None.

III. Information on cash dividends

(1) Cash dividends paid during the six-month period ended September 30, 2022

Date of approval	Type of stock	Total dividends (in millions of yen)	Dividend per share (in yen)	Dividend record date	Effective date
Annual General Meeting of Shareholders on June 29, 2022	Common stock	183,396	14.5	March 31, 2022	June 30, 2022

(Note) The total dividend amount includes ¥459 million of dividends on the treasury shares held by the BIP trust.

(2) Dividends the record date for which fell within the six-month period ended September 30, 2022 and the effective date of which was after the six-month period

Date of approval	Type of stock	Total dividends (in millions of yen)	Source of dividends	Dividend per share (in yen)	Dividend record date	Effective date
Meeting of Board of Directors on November 14, 2022	Common stock	197,131	Retained earnings	16.0	September 30, 2022	December 5, 2022

(Note) The total dividend amount includes ¥459 million of dividends on the treasury shares held by the BIP trust.

23

For the six months ended September 30, 2023

I. Information on the class and number of issued shares and treasury stock

	(Thousand shares)
	Number of shares as of April 1, 2023		Number of shares increased		Number of shares decreased		Number of shares as of September 30, 2023		Note
Issued shares:
Common stock		12,687,710		—		—		12,687,710
Total		12,687,710		—		—		12,687,710
Treasury stock:
Common stock		664,065		15		2,570		661,510		(Notes 1 and 2)
Total		664,065		15		2,570		661,510

(Notes)

1. The increase in the number of shares of common stock held in treasury by 15 thousand shares was due to the repurchases of shares in response to requests made by shareholders holding shares constituting less than one whole unit and an increase in the number of shares held by equity method affiliates. The decrease in the number of shares of common stock held in treasury by 2,570 thousand shares was due to the sale of shares for the BIP trust, the sale of shares in response to requests made by shareholders holding shares constituting less than one whole unit and a decrease in the number of shares held by equity method affiliates.

2. The number of shares of common stock held in treasury as of April 1, 2023 and September 30, 2023 includes 28,407 thousand shares and 25,837 thousand shares held by the BIP trust, respectively. For the six months ended September 30, 2023, the number of shares held by the BIP trust decreased by 2,569 thousand shares.

II. Information on share subscription rights

None.

III. Information on cash dividends

(1) Cash dividends paid during the six-month period ended September 30, 2023

Date of approval	Type of stock	Total dividends (in millions of yen)	Dividend per share (in yen)	Dividend record date	Effective date
Annual General Meeting of Shareholders on June 29, 2023	Common stock	192,859	16.0	March 31, 2023	June 30, 2023

(Note) The total dividend amount includes ¥454 million of dividends on the treasury shares held by the BIP trust.

(2) Dividends the record date for which fell within the six-month period ended September 30, 2023 and the effective date of which was after the six-month period

Date of approval	Type of stock	Total dividends (in millions of yen)	Source of dividends	Dividend per share (in yen)	Dividend record date	Effective date
Meeting of Board of Directors on November 14, 2023	Common stock	247,101	Retained earnings	20.5	September 30, 2023	December 5, 2023

(Note) The total dividend amount includes ¥529 million of dividends on the treasury shares held by the BIP trust.

24

5. Consolidated Statements of Cash Flows

I. “Cash and cash equivalents” compared to items presented on the consolidated balance sheet

The amount of “Cash and cash equivalents” is equal to the amount of “Cash and due from banks” on the consolidated balance sheet.

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6. Leases

Operating leases

I. Lessee

Future lease payments, including interest expenses, under non-cancelable operating leases as of March 31, 2023 and September 30, 2023 were as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Due within one year	¥	40,128	¥	43,716
Due after one year		102,509		114,024
Total	¥	142,637	¥	157,740

(Note) The above table does not include lease payments that are booked as “Right-of-use assets” at overseas subsidiaries.

II. Lessor

Future lease receivables, including interest receivables, under non-cancelable operating leases as of March 31, 2023 and September 30, 2023 were as follows:

	(in millions of yen)
	March 31, 2023		September 30, 2023
Due within one year	¥	7,232	¥	9,500
Due after one year		66,627		72,869
Total	¥	73,860	¥	82,370

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7. Financial Instruments

I. Matters concerning fair value of financial instruments and breakdown by input level

The amounts on the consolidated balance sheet, the fair value of financial instruments, the difference between them as well as a breakdown of financial instruments by input level are as follows.

The following tables do not include investment trusts which are accounted for in accordance with Paragraphs 24-3 and 24-9 of ASBJ Implementation Guidance No. 31, “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ, June 17, 2021) (“Implementation Guidance on Fair Value Measurement”), stocks with no market price, etc. and investments in partnerships and others which are accounted for in accordance with Paragraph 24-16 of the Implementation Guidance on Fair Value Measurement. (See Note (*2) to each of the tables in (1), (Note 3) and (Note 4) below.)

The fair values of financial instruments are classified into the following three levels depending on the observability and significance of the input used in the fair value calculation.

Level 1: Fair value determined based on (unadjusted) quoted prices in active markets for identical assets or liabilities

Level 2: Fair value determined based on directly or indirectly observable inputs other than the Level 1 inputs

Level 3: Fair value determined based on significant unobservable inputs

Where multiple inputs are used with a significant impact on the fair value calculation, the fair value of a financial instrument is classified based on the lowest of the priority levels to which any of those inputs belongs.

27

(1) Financial assets and liabilities at fair value on the consolidated balance sheets

As of March 31, 2023

	(in millions of yen)
Category	Amount on consolidated balance sheet
	Level 1			Level 2			Level 3		Total
Monetary claims bought (*1)		—			792,625			591,530		1,384,156
Trading assets		3,665,466			5,339,485			112,109		9,117,060
Money held in trust (Trading purpose / Other)		—			1,196,190			8,272		1,204,462
Securities (Available-for-sale securities)		41,033,674			21,355,832			400,105		62,789,613
Domestic equity securities		4,246,104			23,429			2,389		4,271,923
Government bonds		23,292,055			226,776			—		23,518,832
Municipal bonds		—			2,759,940			—		2,759,940
Short-term corporate bonds		—			—			—		—
Corporate bonds		—			3,473,132			—		3,473,132
Foreign equity securities		364,746			4,484			39,147		408,377
Foreign bonds		13,021,062			8,686,933			2,165		21,710,161
Investment trusts (*2)		105,025			6,094,265			2,189		6,201,481
Other securities		4,679			86,870			354,213		445,764
Total assets		44,699,141			28,684,133			1,112,017		74,495,292
Trading liabilities (*2)		5,246,139			102,380			—		5,348,520
Borrowed money (FVO) (*3)		—			181,414			—		181,414
Bonds payable (FVO) (*3)		—			195,802			102,130		297,933
Total liabilities		5,246,139			479,596			102,130		5,827,867
Derivatives (*4) (*5) (*6)		(34,824	)		(1,052,077	)		316,707		(770,193	)
Interest rate-related derivatives		4,362			(1,164,150	)		198,796		(960,990	)
Currency-related derivatives		2,229			91,679			12,696		106,605
Equity-related derivatives		(40,343	)		(10,682	)		21,110		(29,914	)
Bond-related derivatives		(1,073	)		30,192			82,566		111,685
Commodity-related derivatives		—			—			90		90
Credit-related derivatives		—			883			1,082		1,965
Other derivatives		—			—			364		364

(*1) Monetary claims bought consist of securitized products, etc. of ¥1,384,156 million accounted for in the same manner as available-for-sale securities.

(*2) The amount of investment trusts which are accounted for in accordance with Paragraph 24-3 and 24-9 of the Implementation Guidance on Fair Value Measurement is not included in the table above. The amount of such investment trusts on the consolidated balance sheet is ¥563,208 million of financial assets.

(*3) Some overseas subsidiaries apply the fair value option.

(*4) Derivative transactions in trading assets and liabilities as well as other assets and liabilities are shown together. Assets or liabilities arising from derivative transactions are presented on a net basis, and net liabilities in the aggregate are presented in minus.

(*5) Derivative transactions to which hedge accounting is applied are reported on the consolidated balance sheet at ¥(570,813) million.

(*6) Transactions to which hedge accounting is applied include interest rate swap transactions designated as hedging instruments for the purpose of fixing cash flows from hedged loans and other assets. Deferred hedge accounting is applied to these transactions. Of these hedge relationships, all hedge relationships to which “Practical Solution on the Treatment of Hedge Accounting for Financial Instruments that Reference LIBOR” (ASBJ PITF No.40, March 17, 2022) applies are accounted for under the standard.

28

As of September 30, 2023

	(in millions of yen)
Category	Amount on consolidated balance sheet
	Level 1			Level 2			Level 3			Total
Monetary claims bought (*1)		—			727,119			1,031,806			1,758,925
Trading assets		4,807,685			5,985,632			82,487			10,875,805
Money held in trust (Trading purpose / Other)		—			1,270,794			8,280			1,279,075
Securities (Available-for-sale securities)		36,020,957			20,335,796			581,127			56,937,881
Domestic equity securities		4,745,430			19,545			1,935			4,766,911
Government bonds		21,647,504			27,724			—			21,675,228
Municipal bonds		—			1,435,995			—			1,435,995
Short-term corporate bonds		—			—			—			—
Corporate bonds		—			2,997,052			19			2,997,072
Foreign equity securities		506,949			42,841			35,298			585,088
Foreign bonds		8,910,371			9,838,722			2,285			18,751,379
Investment trusts (*2)		205,972			5,890,832			2,297			6,099,102
Other securities		4,729			83,081			539,291			627,102
Total assets		40,828,643			28,319,342			1,703,701			70,851,687
Trading liabilities		5,778,560			151,721			—			5,930,282
Borrowed money (FVO) (*3)		—			144,084			—			144,084
Bonds payable (FVO) (*3)		—			198,453			39,126			237,580
Total liabilities		5,778,560			494,259			39,126			6,311,947
Derivatives (*4) (*5) (*6)		6,704			(1,375,814	)		83,638			(1,285,471	)
Interest rate-related derivatives		(523	)		(1,392,141	)		25,638			(1,367,026	)
Currency-related derivatives		(225	)		(78,418	)		10,176			(68,467	)
Equity-related derivatives		3,634			(2,025	)		16,914			18,523
Bond-related derivatives		3,818			97,796			30,682			132,297
Commodity-related derivatives		0			—			(44	)		(44	)
Credit-related derivatives		—			(1,032	)		266			(765	)
Other derivatives		—			6			4			11

(*1) Monetary claims bought consist of securitized products, etc. of ¥1,758,925 million accounted for in the same manner as available-for-sale securities.

(*2) The amount of investment trusts which are accounted for in accordance with Paragraphs 24-3 and 24-9 of the Implementation Guidance on Fair Value Measurement is not included in the table above. The amount of such investment trusts on the consolidated balance sheet is ¥696,761 million of financial assets.

(*3) Some overseas subsidiaries apply the fair value option.

(*4) Derivative transactions in trading assets and liabilities as well as other assets and liabilities are shown together. Assets or liabilities arising from derivative transactions are presented on a net basis, and net liabilities in the aggregate are presented in minus.

(*5) Derivative transactions to which hedge accounting is applied are reported on the consolidated balance sheet at ¥(1,614,518) million.

(*6) Transactions to which hedge accounting is applied include interest rate swap transactions designated as hedging instruments for the purpose of fixing cash flows from hedged loans and other assets. Deferred hedge accounting is applied to these transactions. Of these hedge relationships, all hedge relationships to which “Practical Solution on the Treatment of Hedge Accounting for Financial Instruments that Reference LIBOR” (ASBJ PITF No.40, March 17, 2022) applies are accounted for under the standard.

29

(2) Financial assets and liabilities which are not stated at fair value on the consolidated balance sheets

Cash and due from banks, Call loans and bills bought, Receivables under resale agreements, Receivables under securities borrowing transactions, Foreign exchanges (assets and liabilities), Call money and bills sold, Payables under repurchase agreements, Payables under securities lending transactions, Commercial papers, Short-term bonds payable, Due to trust accounts and Other liabilities are not included in the following tables since they are predominantly short-term (within one year), and their fair values approximate their carrying amounts.

As of March 31, 2023

	(in millions of yen)
Category	Fair value								Amount on consolidated balance sheet		Difference
	Level 1		Level 2		Level 3		Total
Monetary claims bought (*1)		—		—		5,889,213		5,889,213		5,941,029		(51,815	)
Money held in trust (other / held to maturity)		—		80,433		—		80,433		82,557		(2,123	)
Securities (held to maturity)		13,526,750		5,354,471		—		18,881,222		18,965,357		(84,135	)
Government bonds		13,526,750		—		—		13,526,750		13,513,972		12,778
Municipal bonds		—		1,139,490		—		1,139,490		1,144,825		(5,334	)
Short-term corporate bonds		—		—		—		—		—		—
Corporate bonds		—		393,783		—		393,783		393,214		568
Foreign bonds		—		3,821,197		—		3,821,197		3,913,345		(92,148	)
Other securities		—		—		—		—		—		—
Loans and bills discounted (*2) (*3)		—		225,701		108,219,822		108,445,523		108,162,952		282,570
Total assets		13,526,750		5,660,606		114,109,035		133,296,393		133,151,897		144,495
Deposits		—		213,744,141		—		213,744,141		213,609,501		134,639
Negotiable certificates of deposit		—		13,667,733		—		13,667,733		13,632,559		35,173
Borrowed money		—		24,579,207		—		24,579,207		24,674,925		(95,717	)
Bonds payable (*3)		—		14,879,435		—		14,879,435		15,410,786		(531,351	)
Total liabilities		—		266,870,518		—		266,870,518		267,327,774		(457,255	)

(*1) Monetary claims bought include securitized products, etc. of ¥2,554,723 million accounted for in the same manner as securities held to maturity.

(*2) General and specific allowances for credit losses of ¥983,319 million corresponding to loans are deducted. However, with respect to items other than loans, the amount stated on the consolidated balance sheet is shown since the amount of allowance for credit losses corresponding to these items is insignificant.

(*3) With respect to interest rate swaps to which special hedge accounting treatment is applied to offset fluctuations in the market value of the hedged items and forward exchange contracts, etc. to which the allocation method is applied, the fair value of such interest rate swaps and such currency swaps is included in the fair value of the hedged items. Of these hedge relationships, all hedge relationships to which “Practical Solution on the Treatment of Hedge Accounting for Financial Instruments that Reference LIBOR” (ASBJ PITF No.40, March 17, 2022) applies are accounted for under the standard.

30

As of September 30, 2023

	(in millions of yen)
Category	Fair value								Amount on consolidated balance sheet		Difference
	Level 1		Level 2		Level 3		Total
Monetary claims bought (*1)		—		—		6,090,639		6,090,639		6,115,973		(25,334	)
Money held in trust (other / held to maturity)		—		79,360		—		79,360		82,547		(3,187	)
Securities (held to maturity)		14,653,685		6,760,901		—		21,414,587		21,890,143		(475,555	)
Government bonds		14,653,685		—		—		14,653,685		14,767,776		(114,090	)
Municipal bonds		—		1,717,390		—		1,717,390		1,742,822		(25,432	)
Short-term corporate bonds		—		—		—		—		—		—
Corporate bonds		—		591,276		—		591,276		593,864		(2,588	)
Foreign bonds		—		4,452,235		—		4,452,235		4,785,679		(333,444	)
Other securities		—		—		—		—		—		—
Loans and bills discounted (*2) (*3)		—		242,873		112,498,001		112,740,874		112,531,315		209,558
Total assets		14,653,685		7,083,134		118,588,640		140,325,461		140,619,980		(294,519	)
Deposits		—		218,046,149		—		218,046,149		217,863,084		183,065
Negotiable certificates of deposit		—		16,417,673		—		16,417,673		16,357,724		59,948
Borrowed money		—		24,781,848		—		24,781,848		24,828,845		(46,997	)
Bonds payable (*3)		—		15,394,650		—		15,394,650		16,142,336		(747,686	)
Total liabilities		—		274,640,321		—		274,640,321		275,191,990		(551,669	)

(*1) Monetary claims bought include securitized products, etc. of ¥2,766,881 million accounted for in the same manner as securities held to maturity.

(*2) General and specific allowances for credit losses of ¥1,099,714 million corresponding to loans are deducted. However, with respect to items other than loans, the amount stated on the consolidated balance sheet is shown since the amount of allowance for credit losses corresponding to these items is insignificant.

(*3) With respect to interest rate swaps to which special hedge accounting treatment is applied to offset fluctuations in the market value of the hedged items, the fair value of such interest rate swaps is included in the fair value of the hedged items. Of these hedge relationships, all hedge relationships to which “Practical Solution on the Treatment of Hedge Accounting for Financial Instruments that Reference LIBOR” (ASBJ PITF No.40, March 17, 2022) applies are accounted for under the standard.

31

(Note 1) Description of the valuation techniques and inputs used to measure fair value

Monetary claims bought

The fair value of monetary claims bought is determined using prices obtained from third-party vendors (broker-dealers, etc.) or the prices estimated based on internal models.

With respect to some securitized products backed by general corporate loans, the fair value is measured by considering the estimated fair value amounts determined using projected cash flows through an analysis of the underlying loans, probability of default, prepayment rates, etc. and discounting the projected cash flows using discount rates reflecting the liquidity premium based on historical market data and the prices obtained from independent broker-dealers. These products are classified into Level 3.

For other securitized products, the fair value is determined based on the prices obtained from independent third parties after considering the results of periodic confirmation of the current status of these products, including price comparison with similar products, time series data comparison of the same product, and analysis of consistency with publicly available market indices. These products are classified into Level 2 or Level 3 depending on the inputs used for the prices obtained from independent third parties.

For certain monetary claims bought for which these methods do not apply, the fair value is measured based on either the present value using projected future cash flows through an analysis of prepayment rates, etc., and discounting the project cash flows at the market interest rates as of the valuation date with certain adjustments, or is the carrying amount if their fair value approximates such carrying amount from their qualitative viewpoint. If these monetary claims bought are measured at present value, these monetary claims bought are classified into Level 2 or, if they are short-term and their fair value approximates the carrying amount, then the carrying amount is presented as their fair value, and they are classified into Level 3.

Trading assets and liabilities

Securities such as bonds that are held for trading purposes are classified as Level 1 if prices quoted by stock exchanges are available in an active market, and as Level 2 if the fair value is determined based on either the present value of the expected future cash flows discounted at an interest rate based on the market interest rates as of the date of evaluation with certain adjustments or prices quoted by the financial institutions from which these securities are purchased.

Money held in trust

For securities that are part of trust property in an independently managed monetary trust with the primary purpose to manage securities, the fair value is determined based on the prices quoted by the financial institutions from which these securities are purchased, and these securities are classified into Level 2 depending on the fair value hierarchy of the component assets.

See “Money Held in Trust” for notes on money held in trust by category based on each purpose of holding the money held in trust.

Securities

The fair value of equity securities is determined based on the prices quoted by stock exchanges and equity securities are primarily classified into Level 1 as the quoted prices are available in active markets. The fair value of bonds is determined based on the market price or the price quoted by the financial institutions from which they are purchased or based on the price reasonably calculated using internal models. Government bonds are primarily classified into Level 1, other bonds are primarily classified into Level 2, and foreign equity securities with maturity as well as preferred securities included in Other securities are primarily classified into Level 3.

For privately placed guaranteed bonds held by MUFG’s bank subsidiaries, the fair value is determined based on the present value of expected future cash flows, which are adjusted to reflect credit risk, the amounts expected to be collected from collateral and guarantees and guarantee fees, and discounted at an interest rate based on the market interest rates as of the date of evaluation with certain adjustments. These bonds are classified into Level 2 depending on credit risk, etc.

The fair value of investment trusts is determined based on the closing market price or other publicly available net asset value. Listed investment trusts and listed real estate investment trusts, which have closing market prices, are primarily classified into Level 1, and other investment trusts are primarily classified into Level 2. Investment trusts which are accounted for at net asset value in accordance with Paragraphs 24-3 and 24-9 of the Implementation Guidance on Fair Value Measurement are not classified into any fair value hierarchy.

See “Securities” for notes on securities by category based on each purpose of holding the securities.

32

Loans and bills discounted

With respect to loans, for each category of loans based on their types, credit ratings and maturity periods, the fair value is determined based on the present value of expected future cash flows, which are adjusted to reflect default risk and the amount expected to be collected from collateral and guarantees and discounted at an interest rate based on the market interest rates as of the date of evaluation with certain adjustments. These loans are classified into Level 3. For certain loans with floating interest rates, the carrying amount is presented as the fair value, as the fair value approximates such carrying amount, unless the creditworthiness of the borrower has changed significantly since the loan origination. These loans are classified as Level 3.

For receivables from bankrupt, virtually bankrupt and likely to become bankrupt borrowers, credit loss is estimated based on factors such as the present value of expected future cash flows or the amount expected to be collected from collateral and guarantees. Since the fair value of these items approximates the net amount of receivables after the deduction of allowance for credit losses on the consolidated balance sheet as of the consolidated balance sheet date, such amount is presented as the fair value. These receivables are classified into Level 3. The fair value of loans qualifying for special hedge accounting treatment of interest rate swaps or the allocation method applicable to forward exchange contracts and other contracts under Generally Accepted Accounting Principles in Japan (“JGAAP”) reflects the fair value of such interest rate swaps or forward exchange contracts and other contracts.

Deposits and Negotiable certificates of deposit

For demand deposits, the amount payable on demand as of the consolidated balance sheet date (i.e., the carrying amount) is considered to be the fair value. For floating rate time deposits, the carrying amount is presented as the fair value, as the fair value approximates such carrying amount because the market interest rates are reflected in such deposits within a short time period. The fair value of most fixed rate time deposits is the present value of expected future cash flows grouped by certain maturity periods discounted at the market interest rates. These are classified into Level 2.

Borrowed money

For floating rate borrowings, the carrying amount is presented as the fair value, as the fair value approximates such carrying amount. This is on the basis that the interest rates on such floating rate borrowings reflect the market interest rates in a short time period and that there has been no significant change in the creditworthiness of MUFG or MUFG’s consolidated subsidiaries after such borrowings were made. For fixed rate borrowings, the fair value is calculated as the present value of expected future cash flows from these borrowings grouped by certain maturity periods, which are discounted at the market interest rates reflecting the premium applicable to MUFG or MUFG’s consolidated subsidiaries. These are classified as Level 2.

Bonds payable

The fair value of corporate bonds issued by MUFG and MUFG’s consolidated subsidiaries is determined based on their market price. For certain corporate bonds, the fair value is calculated as the present value of expected future cash flows discounted at the market interest rates. For floating rate corporate bonds without market prices, the carrying amount of such bonds is presented as the fair value, as the fair value approximates such carrying amount. This is on the basis that the interest rates on such floating rate corporate bonds reflect the market interest rates in a short time period and that there has been no significant change in the creditworthiness of MUFG or MUFG’s consolidated subsidiaries after the issuance. For fixed rate corporate bonds without market prices, the fair value is the present value of expected future cash flows from these borrowings, which are discounted at the market interest rates reflecting the premium applicable to MUFG or MUFG’s consolidated subsidiaries. These are classified as Level 2. The fair value of corporate bonds qualifying for special hedge accounting treatment of interest rate swaps under JGAAP reflects the fair value of such interest rate swaps.

For structured bonds issued by some overseas subsidiaries, the fair value option is applied, and the fair value of structured bonds is calculated based on models. Structured bonds for which observable inputs are used are classified into Level 2. Structured bonds for which significant unobservable inputs are used are classified into Level 3.

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Derivative transactions

Derivative transactions are ones involving interest rates (interest futures, interest options, interest swaps and other transactions), ones involving foreign currencies (currency futures, currency options, currency swaps and other transactions), and ones involving bonds (bond futures, bond future options and other transactions). The fair value of exchange-traded derivative transactions is based on the prices posted by exchanges. The fair value of over-the-counter derivative transactions is based on the discounted present value or amount calculated under the option-price calculation model.

The key inputs used in the valuation techniques for over-the-counter derivative transactions include interest rate yield curves, foreign currency exchange rates and volatility. For over-the-counter derivative transactions, adjustments are made for counterparty credit risk adjustments (credit valuation adjustments (CVA)) and adjustments are also made to reflect the impact of uncollateralized funding (funding valuation adjustments (FVA)). The calculation of CVA takes into account the probability of a default event occurring for each counterparty which is primarily derived from an observed or estimated spread on credit default swaps. In addition, the calculation of CVA takes into account the effect of credit risk mitigation such as pledged collateral and the legal right of offset with the counterparty. The calculation of FVA takes into account MUFG’s market funding spread reflecting the credit risk of MUFG and the funding exposure of any uncollateralized component of an over-the-counter derivative instrument entered into with the counterparty.

Exchange-traded derivative transactions valued using quoted prices are classified into Level 1. Over-the-counter derivative transactions are classified into Level 2 if their fair value is not measured based on significant unobservable inputs. Over-the-counter derivative transactions whose fair value is measured based on significant unobservable inputs are classified into Level 3.

34

(Note 2) Quantitative information about financial assets and liabilities measured and presented on the consolidated balance sheets at fair value and classified in Level 3

(1) Quantitative information on significant unobservable inputs

As of March 31, 2023

Category	Valuation technique	Signification unobservable inputs	Range	Weighted average (*1)
Monetary claims bought
Securitized products	Internal model (*2)	Correlation between underlying assets	3.0%	3.0%
		Liquidity premium	2.0%~2.2%	2.0%
		Prepayment rate	13.1%	13.1%
		Probability of default	0.0%~99.0%	—
		Recovery rate	72.2%	72.2%
Securities
Foreign equity securities	Discounted cash flow	Liquidity premium	0.8%~1.7%	1.3%
Other	Discounted cash flow	Liquidity premium	1.1%~3.2%	2.9%
Derivatives
Interest rate-related derivatives	Option model	Correlation between interest rates	30.0%~60.6%	—
		Correlation between interest rate and foreign exchange rate	1.9%~60.0%	—
		Volatility	62.2%~106.6%	—
Currency-related derivatives	Option model	Correlation between interest rates	30.0%~70.0%	—
		Correlation between interest rate and foreign exchange rate	13.6%~60.0%	—
		Correlation between foreign exchange rates	50.0%~70.5%	—
		Volatility	10.5%~22.9%	—
Equity-related derivatives	Option model	Volatility	20.4%~37.0%	—
		Correlation between foreign exchange rate and equity	(58.3)%~54.9%	—
		Correlation between equities	(2.3)%~95.0%	—
	Discounted cash flow	Term of litigation	1.0~12.0 months	—

(*1) The weighted average is calculated by weighing each input by the relative fair value of the respective financial assets.

(*2) For further details of Internal model, refer to “Monetary claims bought” in “(Note 1) Description of the valuation techniques and inputs used to measure fair value” under “I. Matters concerning fair value of financial instruments and breakdown by input level” above.

35

As of September 30, 2023

Category	Valuation technique	Signification unobservable inputs	Range		Weighted average (*1)
Monetary claims bought
Securitized products	Internal model (*2)	Correlation between underlying assets		3.0%		3.0%
		Liquidity premium		1.7%~1.9%		1.7%
		Prepayment rate		13.9%		13.9%
		Probability of default		0.0%~99.0%		—
		Recovery rate		57.7%		57.7%
Securities
Foreign equity securities	Discounted cash flow	Liquidity premium		0.8%~1.7%		1.4%
Other	Discounted cash flow	Liquidity premium		1.1%~3.2%		2.9%
Derivatives
Interest rate-related derivatives	Option model	Correlation between interest rates		30.0%~60.3%		—
		Correlation between interest rate and foreign exchange rate		1.2%~60.0%		—
		Volatility		49.9%~96.9%		—
Currency-related derivatives	Option model	Correlation between interest rates		30.0%~70.0%		—
		Correlation between interest rate and foreign exchange rate		11.5%~60.0%		—
		Correlation between foreign exchange rates		50.0%~70.5%		—
		Volatility		10.6%~21.9%		—
Equity-related derivatives	Option model	Volatility		25.0%~37.0%		—
		Correlation between foreign exchange rate and equity		(58.3)%~30.0%		—
		Correlation between equities		(1.3)%~95.0%		—
	Discounted cash flow	Term of litigation		4.0~9.0 months		—

(*1) The weighted average is calculated by weighing each input by the relative fair value of the respective financial assets.

(*2) For further details of Internal model, refer to “Monetary claims bought” in “(Note 1) Description of the valuation techniques and inputs used to measure fair value” under “I. Matters concerning fair value of financial instruments and breakdown by input level” above.

36

(2) Table showing reconciliation between the opening balance and the closing balance during the reporting period, and unrealized gains (losses) recognized in net income (loss)

For the fiscal year ended March 31, 2023

																			(in millions of yen)
Category	March 31, 2022			Included in net income (loss) (*1)			Included in other comprehensive income (*2)			Purchases, Issues, Sales, Settlements and others			Transfers into Level 3 (*3)			Transfers out of Level 3 (*3)			March 31,     2023		Change in unrealized gains (losses) included in net income (loss) on assets and liabilities still held at     March 31,     2023 (*1)
Monetary claims bought		238,878			29,697			(15,750	)		338,704			—			—			591,530		29,366
Trading assets		57,124			4,340			—			51,622			0			(977	)		112,109		4,256
Monetary held in trust (Trading purpose / Other)		8,957			0			159			(844	)		—			—			8,272		0
Securities (Available-for- sale securities)		452,414			30,369			3,812			(89,146	)		6,322			(3,665	)		400,105		33,895
Domestic equity securities		—			1,901			20			274			192			—			2,389		1,294
Corporate bonds		2,519			2			(158	)		(67	)		1,255			(3,552	)		—		—
Foreign equity securities		32,535			1,740			3,104			(915	)		2,683			—			39,147		2,115
Foreign bonds		77,265			(4,470	)		9,410			(80,092	)		166			(113	)		2,165		(6	)
Investment trusts		—			264			—			—			1,925			—			2,189		264
Other securities		340,092			30,930			(8,564	)		(8,345	)		100			—			354,213		30,226
Total assets		757,374			64,407			(11,778	)		300,335			6,322			(4,643	)		1,112,017		67,519
Bonds payable (FVO)		46,674			(33,158	)		3,688			11,306			74,361			(741	)		102,130		40,314
Total liabilities		46,674			(33,158	)		3,688			11,306			74,361			(741	)		102,130		40,314
Derivatives (*4)		186,601			92,326			603			(1,034	)		73,687			(35,476	)		316,707		138,979
Interest rate-related derivatives		110,133			59,990			100			4,622			35,652			(11,703	)		198,796		71,464
Currency-related derivatives		8,471			8,404			120			(4,305	)		(32	)		37			12,696		8,472
Equity-related derivatives		17,423			23,950			383			(20,912	)		4			260			21,110		25,306
Bond-related derivatives		50,300			(792	)		—			19,065			38,063			(24,070	)		82,566		32,896
Commodity- related derivatives		(45	)		151			(1	)		(13	)		—			—			90		151
Credit-related derivatives		320			513			—			248			—			—			1,082		583
Other derivatives		(3	)		107			—			259			—			—			364		104

(*1) Mainly included in Trading income and Other operating income in the consolidated statements of income.

(*2) Included in Net unrealized gains (losses) on available-for-sale securities and Foreign currency translation adjustments in Other comprehensive income in the consolidated statements of comprehensive income.

(*3) Transfers into Level 2 from Level 3 and Transfers into Level 2 from Level 3 were results from material inputs for valuation of derivatives that were mainly previously observable becoming unobservable (unobservable becoming observable) and the significance of the impact of unobservable inputs increasing(declining). These transfers were made at the beginning of the fiscal year.

(*4) Derivative transactions in trading assets and liabilities as well as other assets and liabilities are shown together. Assets or liabilities and gains or losses arising from derivative transactions are presented on a net basis, and net liabilities and losses in the aggregate are presented in minus.

37

For the six months ended September 30, 2023

																		(in millions of yen)
Category	March 31, 2023		Included in net income (loss) (*1)			Included in other comprehensive income (*2)			Purchases, Issues, Sales, Settlements			Transfers into Level 3 (*3)			Transfers out of Level 3 (*4)			September 30, 2023			Change in unrealized gains (losses) included in net income (loss) on assets and liabilities still held at September 30, 2023 (*1)
Monetary claims bought		591,530		92,125			9,392			338,757			—			—			1,031,806			91,934
Trading assets		112,109		6,470			—			(36,157	)		144			(78	)		82,487			6,324
Monetary held in trust (Trading purpose / Other)		8,272		153			98			(244	)		—			—			8,280			149
Securities (Available-for- sale securities)		400,105		45,519			(6,637	)		142,114			25			—			581,127			44,715
Domestic equity securities		2,389		(568	)		102			12			—			—			1,935			(568	)
Corporate bonds		—		(2	)		0			(3	)		25			—			19			(2	)
Foreign equity securities		39,147		3,654			(29	)		(7,473	)		—			—			35,298			2,850
Foreign bonds		2,165		(96	)		216			—			—			—			2,285			(96	)
Investment trusts		2,189		(47	)		155			—			—			—			2,297			(47	)
Other securities		354,213		42,580			(7,082	)		149,580			—			—			539,291			42,580
Total assets		1,112,017		144,268			2,854			444,470			170			(78	)		1,703,701			143,123
Bonds payable (FVO)		102,130		26,855			8,281			(53,743	)		5,166			(49,564	)		39,126			(4,961	)
Total liabilities		102,130		26,855			8,281			(53,743	)		5,166			(49,564	)		39,126			(4,961	)
Derivatives (*5)		316,707		(9,929	)		2,094			(6,390	)		10,269			(229,113	)		83,638			(10,451	)
Interest rate-related derivatives		198,796		(9,825	)		(1,166	)		456			10,593			(173,218	)		25,638			(12,068	)
Currency-related derivatives		12,696		(2,985	)		994			166			(324	)		(371	)		10,176			(2,416	)
Equity-related derivatives		21,110		5,650			2,252			(11,815	)		—			(283	)		16,914			6,554
Bond-related derivatives		82,566		(1,623	)		—			4,980			—			(55,239	)		30,682			(1,404	)
Commodity- related derivatives		90		(140	)		12			(6	)		—			—			(44	)		(140	)
Credit-related derivatives		1,082		(999	)		—			182			—			—			266			(976	)
Other derivatives		364		(5	)		—			(354	)		—			—			4			(0	)

(*1) Mainly included in Trading income and Other operating income in the consolidated statements of income.

(*2) Included in Net unrealized gains (losses) on available-for-sale securities and Foreign currency translation adjustments in Other comprehensive income in the consolidated statements of comprehensive income.

(*3) Transfers into Level 3 from Level 2 were made primarily based on the significance of unobservable inputs considering CVA on the counterparty’s credit risk and FVA on unsecured funding principally in interest rate related transactions. This transfer was implemented at the beginning of the six-month period ended September 30,2023.

(*4) Transfers into Level 2 from Level 3 were made primarily based on declines in the significance of unobservable inputs for valuation of interest rate-related derivatives, taking into account credit valuation adjustments (CVA) for counterparty credit risk and funding valuation adjustments (FVA) for unsecured financing. These transfers were made at the beginning of the six-month period ended September 30,2023.

(*5) Derivative transactions in trading assets and liabilities as well as other assets and liabilities are shown together. Assets or liabilities and gains or losses arising from derivative transactions are presented on a net basis, and net liabilities and losses in the aggregate are presented in minus.

38

(3) Description of the fair value valuation process

At MUFG, the middle division establishes policies and procedures for the calculation of fair value and procedures for the use of fair value valuation models, and the front division develops fair value valuation models in accordance with such policies and procedures. The middle division verifies such models, the inputs used and the fair values obtained through calculation to ensure compatibility with the policies and procedures. In addition, based on the results of such verification, the middle division determines appropriate fair value input level classifications. In the event that market prices obtained from third parties are used as fair values, they are verified through appropriate methods such as confirming the valuation techniques and inputs used and comparing them with the fair values of similar financial instruments.

(4) Description of the sensitivity of the fair value to changes in significant unobservable inputs

Probability of default

Probability of default is an estimate of the likelihood that the default event will occur and MUFG will be unable to collect the contractual amounts. A significant increase (decrease) in the default rate would result in a significant decrease (increase) in a fair value.

Recovery rate and prepayment rate

Recovery rate is the proportion of the total outstanding balance of a bond or loan that is expected to be collected in a liquidation scenario. Prepayment rate represents the proportion of principal that is expected to be paid prematurely in each period on a security or pool of securities. Recovery rate and prepayment rate would affect estimation of future cash flows to a certain extent and changes in these inputs could result in a significant increase or decrease in fair value.

Liquidity premium

Liquidity premium is an adjustment to discount rates to reflect uncertainty of cash flows and liquidity of the financial instruments.

When recent prices of similar instruments are unobservable in inactive or less active markets, discount rates are adjusted based on the facts and circumstances of the markets including the availability of quotes and the time since the latest available quotes. A significant increase (decrease) in discount rates would result in a significant decrease (increase) in a fair value.

Volatility

Volatility is a measure of the speed and severity of market price changes and is a key factor in pricing. A significant increase (decrease) in volatility would cause a significant increase (decrease) in the value of an option resulting in a significant increase (decrease) in fair value. The level of volatility generally depends on the tenor of the underlying assets and the strike price or level defined in the contract. Volatilities for certain combinations of tenor and strike price are not observable.

39

Correlation

Correlation is a measure of the relationship between the movements of two variables (i.e., how the change in one variable influences a change in the other variables). A variety of correlation-related assumptions are required for a wide range of instruments including foreign government and official institution bonds, asset-backed securities, corporate bonds, derivatives and certain other financial instruments. In most cases, correlations used are not observable in the market and must be estimated using historical information. Changes in correlation inputs can have a major impact, favorable or unfavorable, on the value of an instrument, depending on its nature. In addition, the wide range of correlation inputs are primarily due to the complex and unique nature of these instruments. There are many different types of correlation inputs, including cross-asset correlation (such as correlation between interest rate and equity) and same-asset correlation (such as correlation between interest rates). Correlation levels are highly dependent on market conditions and could have a relatively wide range of levels within or across asset classes. For interest rate contracts and foreign exchange contracts, the diversity in the portfolio held by MUFG is reflected in wide ranges of correlation, as the fair values of transactions with a variety of currencies and tenors are determined using several foreign exchange and interest rate curves. For equity derivative contracts, the wide range of correlation between interest rate and equity is primarily due to the large number of correlation pairs with different maturities of contracts.

Term of litigation

Term of litigation is the estimated period until the resolution of a certain litigation matter that relates to an issuer’s restricted shares (“Covered Litigation”) that MUFG purchased, which is referenced in certain swap transactions. These swaps are valued using a discounted cash flow methodology and are dependent upon the final resolution of the Covered Litigation.

The settlement timing of the Covered Litigation is not observable in the market, therefore, the estimated term is classified as a level 3 input. The restricted shares which MUFG purchased will be convertible to listed shares of the issuer at the end of the Covered Litigation. The restricted shares will be diluted depending upon the settlement amount of the Covered Litigation and the dilution of the restricted shares is accomplished through an adjustment to the conversion rate of the restricted shares. In order to hedge the reduction of the conversion rate, MUFG entered into certain swaps with the seller which references the conversion rate. The value generated by these trades is subject to the ultimate term of the issuer’s litigation, subject to a minimum term referenced within the trade contracts.

(Note 3) Quantitative information about investment trusts which are accounted for in accordance with Paragraphs 24-3 and 24-9 of the Implementation Guidance for on Fair Value Measurement Table showing reconciliation between the opening balance and the closing balance during the reporting period, and unrealized gains (losses) recognized in net income (loss)

For the fiscal year ended March 31, 2023

														(in millions of yen)
Category	March 31, 2022		Included in net income (loss) (*1)		Included in other comprehensive income (*2)		Purchases, Sales, Redemptions			Transfers into Paragraphs 24-3 and 24-9		Transfers out of Paragraphs 24-3 and 24-9		March 31, 2023		Change in unrealized gains (losses) included in net income (loss) on Investment trusts still held at March 31, 2023 (*1)
Investment trusts (Available-for-sale securities)		323,042		15,239		12,702		212,223			—		—		563,208		13,397
Paragraph 24-3 (*3)		293,398		14,751		12,393		213,356			—		—		533,900		13,397
Paragraph 24-9		29,644		488		308		(1,133	)		—		—		29,308		—

(*1) Mainly included in Other operating income in the consolidated statements of income.

(*2) Included in Net unrealized gains (losses) on available-for-sale securities in Other comprehensive income in the consolidated statements of comprehensive income.

(*3) Investment trusts that were subject to significance cancellation or repurchase restrictions as of March 31, 2023 primarily included ¥ 234,680 million of those which were irrevocable, ¥9,023 million of those which were subject to cancellation restrictions for a certain period, ¥ 68,146 million of those which required advance notice or had a specified redemption date and ¥ 222,050 million of those which were subject to caps on redemption amounts.

40

For the six months ended September 30, 2023

														(in millions of yen)
Category	March 31, 2023		Included in net income (loss) (*1)		Included in other comprehensive income (*2)		Purchases, Sales, Redemptions		Transfers into Paragraphs 24-3 and 24-9		Transfers out of Paragraphs 24-3 and 24-9			September 30, 2023		Change in unrealized gains (losses) included in net income (loss) on Investment trusts still held at September 30, 2023 (*1)
Investment trusts (Available-for-sale securities)		563,208		51,006		16,277		68,333		—		(2,063	)		696,761		50,132
Paragraph 24-3 (*3)		533,900		51,006		15,899		65,690		—		—			666,496		50,132
Paragraph 24-9		29,308		—		378		2,642		—		(2,063	)		30,264		—

(*1) Mainly included in Other operating income in the consolidated statements of income.

(*2) Included in Net unrealized gains (losses) on available-for-sale securities in Other comprehensive income in the consolidated statements of comprehensive income.

(*3) Investment trusts that were subject to significance cancellation or repurchase restrictions as of September 30, 2023 primarily included ¥ 278,852 million of those which were irrevocable, ¥12,946 million of those which were subject to cancellation restrictions for a certain period, ¥ 73,142 million of those which required advance notice or had a specified redemption date and ¥ 301,554 million of those which were subject to caps on redemption amounts.

(Note 4) The following table sets forth the amounts of equity securities with no market price available and investments in partnerships and others on the consolidated balance sheets. These securities and investments are not included in “Trading assets” or “Securities” in the tables presented under the section captioned “Matters concerning fair value of financial instruments and breakdown by input level”.

	(in millions of yen)
	Amount on consolidated balance sheet
	March 31, 2023		September 30, 2023
Equity securities with no quoted market price available (*1) (*3)	¥	240,353	¥	285,541
Investments in partnerships and others (*2) (*3)		386,822		433,450

(*1) Equity securities with no market price available include unlisted equity securities, etc. and are not subject to fair value disclosure in accordance with Paragraph 5 of ASBJ Implementation Guidance No. 19 “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ, March 31, 2020).

(*2) Investments in partnerships and others mainly include silent partnerships and investment partnerships and other partnerships. These investments are accounted for in accordance with Paragraph 24-16 of the Implementation Guidance on Fair Value Measurement and are not subject to fair value disclosure.

(*3) An impairment loss of ¥13,277 million and ¥4,173 million was recorded on unlisted equity securities and other investments for the fiscal year ended March 31, 2023 and for the six months ended September 30, 2023, respectively.

41

8. Securities

In addition to “Securities” on the consolidated balance sheet, the figures in the following tables include negotiable certificates of deposit in “Cash and due from banks,” securitized products in “Monetary claims bought” and others.

I. Debt securities being held to maturity

	(in millions of yen)
	March 31, 2023
	Amount on consolidated balance sheet		Fair value		Difference
Securities whose fair value exceeds amount on consolidated balance sheet:
Domestic bonds	¥	10,376,390	¥	10,412,002	¥	35,612
Government bonds		9,759,930		9,792,060		32,129
Municipal bonds		371,872		374,345		2,473
Short-term corporate bonds		—		—		—
Corporate bonds		244,587		245,596		1,009
Other securities		1,372,943		1,386,568		13,625
Foreign bonds		1,359,270		1,372,876		13,606
Other		13,672		13,691		18
Subtotal	¥	11,749,333	¥	11,798,571	¥	49,237
Securities whose fair value does not exceed amount on consolidated balance sheet:
Domestic bonds	¥	4,675,622	¥	4,648,022	¥	(27,599	)
Government bonds		3,754,041		3,734,689		(19,351	)
Municipal bonds		772,953		765,145		(7,808	)
Short-term corporate bonds		—		—		—
Corporate bonds		148,627		148,186		(440	)
Other securities		5,095,124		4,939,561		(155,563	)
Foreign bonds		2,554,074		2,448,320		(105,754	)
Other		2,541,050		2,491,241		(49,809	)
Subtotal	¥	9,770,747	¥	9,587,583	¥	(183,163	)
Total	¥	21,520,080	¥	21,386,154	¥	(133,925	)

42

	(in millions of yen)
	September 30, 2023
	Amount on consolidated balance sheet		Fair value		Difference
Securities whose fair value exceeds amount on consolidated balance sheet:
Domestic bonds	¥	4,685,564	¥	4,694,896	¥	9,331
Government bonds		4,538,664		4,547,731		9,066
Municipal bonds		57,613		57,682		69
Short-term corporate bonds		—		—		—
Corporate bonds		89,286		89,482		196
Other securities		129,200		130,083		882
Foreign bonds		—		—		—
Other		129,200		130,083		882
Subtotal	¥	4,814,765	¥	4,824,979	¥	10,214
Securities whose fair value does not exceed amount on consolidated balance sheet:
Domestic bonds	¥	12,418,899	¥	12,267,455	¥	(151,443	)
Government bonds		10,229,111		10,105,954		(123,157	)
Municipal bonds		1,685,209		1,659,707		(25,501	)
Short-term corporate bonds		—		—		—
Corporate bonds		504,578		501,793		(2,784	)
Other securities		7,423,360		7,065,649		(357,711	)
Foreign bonds		4,785,679		4,452,235		(333,444	)
Other		2,637,681		2,613,414		(24,266	)
Subtotal	¥	19,842,259	¥	19,333,105	¥	(509,154	)
Total	¥	24,657,025	¥	24,158,085	¥	(498,939	)

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II. Available-for-sale securities

	(in millions of yen)
	March 31, 2023
	Amount on consolidated balance sheet		Acquisition cost		Difference
Securities whose fair value exceeds the acquisition cost:
Domestic equity securities	¥	4,163,474	¥	1,418,238	¥	2,745,235
Domestic bonds		17,607,265		17,585,008		22,256
Government bonds		15,329,062		15,319,949		9,112
Municipal bonds		963,233		961,170		2,062
Short-term corporate bonds		—		—		—
Corporate bonds		1,314,969		1,303,888		11,081
Other securities		10,331,365		10,042,218		289,146
Foreign equity securities		84,666		61,576		23,090
Foreign bonds		7,246,857		7,185,651		61,205
Other		2,999,841		2,794,990		204,850
Subtotal	¥	32,102,105	¥	29,045,466	¥	3,056,638
Securities whose fair value does not exceed the acquisition cost:
Domestic equity securities	¥	108,448	¥	132,955	¥	(24,506	)
Domestic bonds		12,144,639		12,286,917		(142,277	)
Government bonds		8,189,769		8,285,247		(95,477	)
Municipal bonds		1,796,707		1,812,579		(15,871	)
Short-term corporate bonds		—		—		—
Corporate bonds		2,158,162		2,189,090		(30,928	)
Other securities		20,765,881		22,235,570		(1,469,688	)
Foreign equity securities		323,710		412,405		(88,695	)
Foreign bonds		14,463,304		15,640,718		(1,177,413	)
Other		5,978,866		6,182,446		(203,579	)
Subtotal	¥	33,018,970	¥	34,655,443	¥	(1,636,472	)
Total	¥	65,121,075	¥	63,700,909	¥	1,420,165

(Note) The total difference amount shown in the table above includes ¥127,758 million revaluation gains on securities by application of the fair value hedge accounting method.

44

	(in millions of yen)
	September 30, 2023
	Amount on consolidated balance sheet		Acquisition cost		Difference
Securities whose fair value exceeds the acquisition cost:
Domestic equity securities	¥	4,694,379	¥	1,410,199	¥	3,284,179
Domestic bonds		6,471,423		6,461,128		10,295
Government bonds		5,542,690		5,539,094		3,595
Municipal bonds		213,918		213,389		528
Short-term corporate bonds		—		—		—
Corporate bonds		714,815		708,644		6,170
Other securities		7,044,077		6,684,857		359,220
Foreign equity securities		85,156		59,770		25,386
Foreign bonds		2,130,534		2,118,040		12,494
Other		4,828,385		4,507,046		321,339
Subtotal	¥	18,209,880	¥	14,556,185	¥	3,653,694
Securities whose fair value does not exceed the acquisition cost:
Domestic equity securities	¥	72,531	¥	90,679	¥	(18,147	)
Domestic bonds		19,636,873		19,859,189		(222,316	)
Government bonds		16,132,538		16,285,798		(153,259	)
Municipal bonds		1,222,077		1,235,130		(13,053	)
Short-term corporate bonds		—		—		—
Corporate bonds		2,282,257		2,338,261		(56,003	)
Other securities		21,847,911		23,891,584		(2,043,672	)
Foreign equity securities		499,931		632,076		(132,144	)
Foreign bonds		16,620,845		18,339,892		(1,719,047	)
Other		4,727,135		4,919,615		(192,480	)
Subtotal	¥	41,557,316	¥	43,841,453	¥	(2,284,136	)
Total	¥	59,767,197	¥	58,397,639	¥	1,369,558

(Note) The total difference amount shown in the table above includes ¥258,087 million revaluation gains on securities by application of the fair value hedge accounting method.

45

III. Securities with impairment losses

Securities other than those held for trading purposes and investments in affiliates (excluding certain equity securities with no quoted market price available and investments in partnerships and others) are subject to write-downs when their fair value significantly declines and it is determined as of the end of the reporting period that it is not probable that the value will recover to the acquisition cost. In such case, the fair value is recorded on the consolidated balance sheet and the difference between the fair value and the acquisition cost is recognized as losses for the reporting period (referred to as “impairment losses”).

Impairment losses on such securities for the fiscal year ended March 31, 2023 were ¥2,825 million consisting of ¥2,370 million on equity securities and ¥455 million on bonds and other securities.

Impairment losses on such securities for the six-month period ended September 30, 2023 were ¥129 million consisting of ¥99 million on equity securities and ¥30 million on bonds and other securities.

Whether there is any “significant decline in the fair value” is determined for each category of issuers in accordance with the internal standards for self-assessment of asset quality as provided below:

Bankrupt issuers, virtually bankrupt issuers and likely to become bankrupt issuers:

The fair value is lower than the acquisition cost.

Issuers requiring close watch:

The fair value has declined 30% or more from the acquisition cost.

Normal issuers:

The fair value has declined 50% or more from the acquisition cost.

“Bankrupt issuers” means issuers who have entered into bankruptcy, special liquidation proceedings or similar legal proceedings or whose notes have been dishonored and suspended from processing through clearing houses. “Virtually bankrupt issuers” means issuers who are not legally or formally bankrupt but are regarded as substantially in similar condition. “Likely to become bankrupt issuers” means issuers who are not yet legally or formally bankrupt but deemed to have a high possibility of becoming bankrupt. “Issuers requiring close watch” means issuers who are financially weak and are under close monitoring by our subsidiaries.

“Normal issuers” means issuers other than those who are categorized in the four categories of issuers mentioned above.

46

9. Money Held in Trust

I. Money held in trust being held to maturity

	(in millions of yen)
	March 31, 2023
	(a) Amount on the consolidated balance sheet		(b) Fair value		Difference (b) - (a)			Money held in trust with respect to which (b) exceeds (a)		Money held in trust with respect to which (b) does not exceed (a)
Money held in trust being held to maturity	¥	42,057	¥	42,203	¥	145		¥	145	¥	—
	(in millions of yen)
	September 30, 2023
	(a) Amount on the consolidated balance sheet		(b) Fair value		Difference (b) - (a)			Money held in trust with respect to which (b) exceeds (a)		Money held in trust with respect to which (b) does not exceed (a)
Money held in trust being held to maturity	¥	42,047	¥	41,980	¥	(66	)	¥	—	¥	66

(Note) “Money held in trust with respect to which (b) exceeds (a)” and “Money held in trust with respect to which (b) does not exceed (a)” show the breakdown of “Difference (b) - (a)”.

II. Money held in trust not for trading purposes or being held to maturity

	(in millions of yen)
	March 31, 2023
	(a) Amount on the consolidated balance sheet		(b) Acquisition cost		Difference (a) - (b)			Money held in trust with respect to which (a) exceeds (b)		Money held in trust with respect to which (a) does not exceed (b)
Money held in trust not for trading purposes or being held to maturity	¥	1,184,070	¥	1,194,684	¥	(10,614	)	¥	152	¥	10,767
	(in millions of yen)
	September 30, 2023
	(a) Amount on the consolidated balance sheet		(b) Acquisition cost		Difference (a) - (b)			Money held in trust with respect to which (a) exceeds (b)		Money held in trust with respect to which (a) does not exceed (b)
Money held in trust not for trading purposes or being held to maturity	¥	1,262,599	¥	1,293,578	¥	(30,978	)	¥	582	¥	31,560

(Note) “Money held in trust with respect to which (a) exceeds (b)” and “Money held in trust with respect to which (a) does not exceed (b)” show the breakdown of “Difference (a) - (b)”.

47

10. Net Unrealized Gains (Losses) on Available-for-Sale Securities

Net unrealized gains (losses) on available-for-sale securities recorded on the consolidated balance sheet as of the dates indicated consisted of the following:

As of March 31, 2023

	(in millions of yen)
Net unrealized gains (losses)	¥	1,292,586
Available-for-sale securities		1,303,200
Money held in trust not for trading purpose or being held to maturity		(10,614	)
Deferred tax liabilities		(353,658	)
Net unrealized gains (losses) on available-for-sale securities, net of deferred tax liabilities (before adjustments for non-controlling interests)		938,927
Non-controlling interests		(8,248	)
MUFG’s ownership share in equity method investees’ unrealized gains (losses) on available-for-sale securities		(129,723	)
Total	¥	800,955

(Notes)

1. “Net unrealized gains (losses)” shown in the above table excludes ¥127,758 million of revaluation gains on securities as a result of application of the fair value hedge accounting method, which are recorded in current earnings.

2. “Net unrealized gains (losses)” shown in the above table includes ¥5,945 million of unrealized gains on available-for-sale securities in investment limited partnerships and ¥4,847 million of unrealized gains as a result of foreign exchange adjustments related to available-for-sale securities denominated in foreign currencies that are included in equity securities with no quoted market price available.

As of September 30, 2023

	(in millions of yen)
Net unrealized gains (losses)	¥	1,096,067
Available-for-sale securities		1,127,046
Money held in trust not for trading purpose or being held to maturity		(30,978	)
Deferred tax liabilities		(310,121	)
Net unrealized gains (losses) on available-for-sale securities, net of deferred tax liabilities (before adjustments for non-controlling interests)		785,946
Non-controlling interests		(8,633	)
MUFG’s ownership share in equity method investees’ unrealized gains (losses) on available-for-sale securities		(140,026	)
Total	¥	637,286

(Notes)

1. “Net unrealized gains (losses)” shown in the above table excludes ¥258,087 million of revaluation gains on securities as a result of application of the fair value hedge accounting method, which are recorded in current earnings.

2. “Net unrealized gains (losses)” shown in the above table includes ¥8,417 million of unrealized gains on available-for-sale securities in investment limited partnerships and ¥7,158 million of unrealized gains as a result of foreign exchange adjustments related to available-for-sale securities denominated in foreign currencies that are included in equity securities with no quoted market price available.

48

11. Derivatives

Derivatives to which hedge accounting is not applied

With respect to derivatives to which hedge accounting is not applied, the contract amounts or notional principal amounts and the fair values and related valuation gains (losses) as of the end of the reporting period by transaction type were as follows. The contract and other amounts do not represent the market risk exposures associated with the relevant derivatives.

I. Interest rate-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Interest rate futures	Sold	¥	3,212,393	¥	1,023,741	¥	(2,630	)	¥	(2,630	)
	Bought		6,947,059		3,941,952		9,547			9,547
Interest rate options	Sold		1,242,739		164,656		(1,665	)		522
	Bought		2,839,283		217,661		4,976			(525	)
Over-the-counter (“OTC”) transactions:
Forward rate agreements	Sold		4,890,444		127,798		(178	)		(178	)
	Bought		4,679,399		141,997		247			247
Interest rate swaps	Receivable fixed rate/ Payable floating rate		670,597,702		498,363,469		(1,542,358	)		(1,542,358	)
	Receivable floating rate/ Payable fixed rate		677,389,391		496,675,884		1,133,783			1,133,783
	Receivable floating rate/ Payable floating rate		92,175,425		67,731,962		30,390			30,390
	Receivable fixed rate/ Payable fixed rate		1,341,839		1,144,120		14,217			14,217
Interest rate swaptions	Sold		28,156,998		18,344,562		(573,133	)		(446,244	)
	Bought		23,325,825		15,824,115		430,994			376,357
Other	Sold		6,182,525		4,019,200		(107,195	)		(57,719	)
	Bought		5,158,134		4,063,502		69,566			20,521
Total			—		—	¥	(533,439	)	¥	(464,069	)

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

49

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Interest rate futures	Sold	¥	2,243,262	¥	1,056,256	¥	12,803		¥	12,803
	Bought		6,953,019		3,217,734		(11,074	)		(11,074	)
Interest rate options	Sold		2,639,136		96,409		(6,044	)		(3,390	)
	Bought		3,722,800		230,557		8,384			3,516
OTC transactions:
Forward rate agreements	Sold		11,079,164		755,856		(1,427	)		(1,427	)
	Bought		12,875,704		908,786		4,717			4,717
Interest rate swaps	Receivable fixed rate/ Payable floating rate		719,029,603		561,576,782		(7,542,698	)		(7,542,698	)
	Receivable floating rate/ Payable fixed rate		722,912,572		561,715,490		7,471,876			7,471,876
	Receivable floating rate/ Payable floating rate		86,124,022		64,480,779		62,559			62,559
	Receivable fixed rate/ Payable fixed rate		1,552,074		1,433,109		11,711			11,711
Interest rate swaptions	Sold		28,177,461		19,771,075		(499,531	)		(380,266	)
	Bought		24,525,952		16,236,520		424,674			365,834
Other	Sold		8,750,958		4,900,159		(119,721	)		(56,893	)
	Bought		6,039,351		4,559,218		89,022			30,709
Total			—		—	¥	(94,747	)	¥	(32,022	)

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

50

II. Currency-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Currency futures	Sold	¥	80,331	¥	—	¥	181		¥	181
	Bought		477,916		63,107		2,047			2,047
OTC transactions:
Currency swaps			71,642,892		54,326,533		223,796			223,796
Forward contracts on foreign exchange			203,252,064		11,544,013		(26,371	)		(26,371	)
Currency options	Sold		9,999,109		3,171,417		(97,602	)		10,372
	Bought		9,744,806		3,071,078		129,718			(18,556	)
Total			—		—	¥	231,771		¥	191,471

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Currency futures	Sold	¥	75,282	¥	—	¥	567		¥	567
	Bought		640,031		75,907		(793	)		(793	)
OTC transactions:
Currency swaps			76,871,161		58,605,664		286,772			286,772
Forward contracts on foreign exchange			213,118,164		13,004,098		8,557			8,557
Currency options	Sold		10,287,900		3,125,916		(233,329	)		(93,858	)
	Bought		9,844,200		3,086,292		229,994			73,301
Total			—		—	¥	291,769		¥	274,548

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

51

III. Equity-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Stock index futures	Sold	¥	570,055	¥	9,429	¥	(2,325	)	¥	(2,325	)
	Bought		377,946		4,946		1,485			1,485
Stock index options	Sold		871,243		345,095		(66,185	)		5,996
	Bought		410,704		121,491		26,682			3,034
OTC transactions:
OTC securities option transactions	Sold		325,392		121,690		(19,147	)		(2,728	)
	Bought		757,371		683,303		30,260			29,357
OTC securities index swap transactions	Receivable index volatility/ Payable interest rate		779,211		61,800		6,681			6,681
	Receivable interest rate/ Payable index volatility		847,067		238,812		12,893			12,893
Forward transactions in OTC securities indexes	Sold		150		—		15			15
	Bought		59,035		—		(2,180	)		(2,180	)
Total			—		—	¥	(11,818	)	¥	52,231

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Stock index futures	Sold	¥	693,487	¥	—	¥	4,938		¥	4,938
	Bought		375,168		8,757		8,499			8,499
Stock index options	Sold		899,960		356,562		(61,168	)		3,178
	Bought		553,711		282,930		51,364			19,387
OTC transactions:
OTC securities option transactions	Sold		274,627		124,499		(17,768	)		(2,819	)
	Bought		506,808		422,496		25,747			23,919
OTC securities index swap transactions	Receivable index volatility/ Payable interest rate		844,008		8,351		(15,970	)		(15,970	)
	Receivable interest rate/ Payable index volatility		711,580		62,827		4,320			4,320
Forward transactions in OTC securities indexes	Sold		41,403		41,228		(5,727	)		(5,727	)
	Bought		84,111		41,228		6,289			6,289
Total			—		—	¥	525		¥	46,016

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

52

IV. Bond-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Bond futures	Sold	¥	303,891	¥	—	¥	(668	)	¥	(668	)
	Bought		555,926		—		(767	)		(767	)
Bond futures options	Sold		155,276		—		(92	)		434
	Bought		152,495		—		454			(45	)
OTC transactions:
Bond OTC options	Sold		1,442,951		—		(2,827	)		(529	)
	Bought		1,442,951		—		2,838			236
Bond OTC swaps	Receivable fixed rate/ Payable variable rate		131,100		131,100		25,709			25,709
	Receivable variable rate/ Payable fixed rate		3,156		3,156		(404	)		(404	)
	Receivable variable rate/ Payable variable rate		233,518		233,518		37,347			37,347
	Receivable fixed rate/ Payable fixed rate		372,300		372,300		53,678			53,678
Total return swaps	Sold		—		—		—			—
	Bought		301,535		218,974		(3,581	)		(3,581	)
Total			—		—	¥	111,685		¥	111,408

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Bond futures	Sold	¥	906,752	¥	—	¥	5,183		¥	5,183
	Bought	472,966		—		(1,157)			(1,157)
Bond futures options	Sold		241,818		—		(435	)		24
	Bought	228,068		—		469			(97)
OTC transactions:
Bond OTC options	Sold		2,071,197		—		(2,455	)		1,371
	Bought	2,071,197		—		5,450			1,138
Bond OTC swaps	Receivable fixed rate/ Payable variable rate		181,500		181,500		29,462			29,462
	Receivable variable rate/ Payable fixed rate	3,536		3,536		(132)			(132)
	Receivable variable rate/ Payable variable rate	267,951		267,951		63,636			63,636
	Receivable fixed rate/ Payable fixed rate	462,600		462,600		48,894			48,894
Total return swaps	Sold		—		—		—			—
	Bought	270,312		215,526		(16,619)			(16,619)
Total			—		—	¥	132,297		¥	131,705

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

53

V. Commodity-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
OTC transactions:
Commodity swaps	Receivable index volatility/ Payable interest rate	¥	72,188	¥	72,188	¥	(9,777	)	¥	(9,777	)
	Receivable interest rate/ Payable index volatility	72,188		72,188		9,907			9,907
Commodity options	Sold		100		100		(39	)		(39	)
	Bought	—		—		—			—
Total			—		—	¥	90		¥	90
(Notes) 1.  The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income. 2.  The commodities are mainly those related to natural gas and other commodities.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
Transactions listed on exchanges:
Commodity futures	Sold	¥	—	¥	—	¥	—		¥	—
	Bought	0		—		0			0
OTC transactions:
Commodity swaps	Receivable index volatility/ Payable interest rate		78,063		78,063		(18,548	)		(18,548	)
	Receivable interest rate/ Payable index volatility	78,063		78,063		18,547			18,547
Commodity options	Sold		99		99		(43	)		(43	)
	Bought	—		—		—			—
Total			—		—	¥	(44	)	¥	(44	)

(Notes)

1. The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

2. The commodities are mainly those related to oil and natural gas.

54

VI. Credit-related derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
OTC transactions:
Credit default options	Sold	¥	5,194,703	¥	4,376,844	¥	28,424		¥	28,424
	Bought		6,187,626		5,291,269		(26,458	)		(26,458	)
Total			—		—	¥	1,965		¥	1,965

(Notes)

1. The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

2. “Sold” refers to transactions where the credit risk is assumed, and “Bought” refers to transactions where the credit risk is transferred.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
OTC transactions:
Credit default options	Sold	¥	2,869,400	¥	2,385,823	¥	19,632		¥	19,632
	Bought		3,715,937		3,165,494		(20,398	)		(20,398	)
Total			—		—	¥	(765	)	¥	(765	)

(Notes)

1. The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

2. “Sold” refers to transactions where the credit risk is assumed, and “Bought” refers to transactions where the credit risk is transferred.

55

VII. Other derivatives

		(in millions of yen)
		March 31, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
OTC transactions:
Earthquake derivatives	Sold	¥	7,000	¥	7,000	¥	(1	)	¥	332
	Bought		7,354		7,000		357			(236	)
Other	Sold		5,129		5,129		(62	)		(62	)
	Bought		7,466		7,466		70			70
Total			—		—	¥	364		¥	104

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

		(in millions of yen)
		September 30, 2023
		Contract amount				Fair value			Valuation gains (losses)
		Total		Over one year
OTC transactions:
Earthquake derivatives	Sold	¥	6,231	¥	—	¥	(206	)	¥	481
	Bought		6,347		—		204			(374	)
Other	Sold		6,914		5,019		(71	)		(71	)
	Bought		9,377		5,019		84			84
Total			—		—	¥	11		¥	121

(Note)

The transactions above are stated at fair value and the related valuation gains (losses) are reported in the consolidated statements of income.

56

12. Stock Options

Amount of, and income statement line-item for, expenses relating to stock options

	(in millions of yen)
	For the six months ended September 30,
	2022		2023
General and administrative expenses	¥	5,369	¥	11,052

57

13. Revenue Recognition

Disaggregated information on revenues from contracts with customers

	(in millions of yen)
	For the six months ended September 30,
	2022		2023
Fees and commissions	¥	859,244		961,227
Fees and commissions on remittances and transfers		80,376		81,082
Fees and commissions on deposits		32,915		22,523
Fees and commissions on loans (*1)		160,515		203,342
Fees and commissions on trust-related services		49,802		53,201
Fees and commissions on security-related services		73,530		81,819
Fees and commissions on credit card business (*1)		147,472		156,863
Fees and commissions on administration and management services for investment funds and investment advisory services		117,961		134,501
Guarantee fees (*2)		60,725		65,544
Other fees and commissions (*1)		135,943		162,348
Trust fees	¥	71,411		67,414

(Notes)

1. Include revenues that are not within the scope of ASBJ Statement No.29, “Accounting Standard for Revenue Recognition.”

2. Guarantee fees are not included within the scope of ASBJ Statement No.29, “Accounting Standard for Revenue Recognition.”

3. Fees and commissions on remittances and transfers were generated mainly through the Digital Service Business Group, the Retail & Commercial Banking Business Group, the Japanese Corporate & Investment Banking Business Group, the Global Commercial Banking Business Group and the Global Corporate & Investment Banking Business Group. Fees and commissions on deposits were generated mainly through the Digital Service Business Group and the Global Commercial Banking Business Group. Fees and commissions on loans were generated mainly through the Digital Service Business Group, the Retail & Commercial Banking Business Group, the Japanese Corporate & Investment Banking Business Group and the Global Corporate & Investment Banking Business Group. Fees and commissions on trust-related services were generated mainly through the Asset Management & Investor Services Business Group. Fees and commissions on security-related services were generated mainly through the Retail & Commercial Banking Business Group, the Japanese Corporate & Investment Banking Business Group and the Global Corporate & Investment Banking Business Group. Fees and commissions on credit card business were generated mainly through the Digital Service Business Group. Fees and commissions on administration and management services for investment funds and investment advisory services were generated mainly through the Asset Management & Investor Services Business Group. Trust fees were generated mainly through the Retail & Commercial Banking Business Group, the Japanese Corporate & Investment Banking Business Group and the Asset Management & Investor Services Business Group.

4. For details of the performance obligations and the timing of revenue recognition for each revenue category, refer to“(15) Revenue Recognition” under “IV. Accounting policies” under “1. Significant Accounting Policies Applied to the Semi-Annual Consolidated Financial Statements.”

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14. Segment Information

I. Business segment information

(1) Summary of reporting segments

MUFG’s reporting segments are business units of MUFG which its Executive Committee, the decision-making body for the execution of its business operations, regularly reviews to make decisions regarding allocation of management resources and evaluate performance.

MUFG makes and executes unified group-wide strategies based on customer characteristics and the nature of business.

Accordingly, MUFG has adopted customer-based and business-based segmentation, which consists of the following reporting segments: Digital Service Business Group, Retail & Commercial Banking Business Group, Japanese Corporate & Investment Banking Business Group, Global Commercial Banking Business Group, Asset Management & Investor Services Business Group, Global Corporate & Investment Banking Business Group, Global Markets Business Group and Other.

Digital Service Business Group:	Providing financial services mainly in non-face-to-face transactions to individual and corporate customers, and promoting MUFG-wide digital transformation
Retail & Commercial Banking Business Group:	Providing services relating to finance, real estate and stock transfers to Japanese individual and corporate customers
Japanese Corporate & Investment Banking Business Group:	Providing services relating to finance, real estate and stock transfers to large Japanese corporate customers
Global Commercial Banking Business Group:	Providing financial services to individual and small to medium sized corporate customers of overseas commercial bank investees of MUFG
Asset Management & Investor Services Business Group:	Providing asset management and administration services to domestic and overseas investor and asset manager customers
Global Corporate & Investment Banking Business Group:	Providing financial services to large non-Japanese corporate customers
Global Markets Business Group:	Providing services relating to foreign currency exchange, funds and investment securities to customers, as well as conducting market transactions and managing liquidity and cash for MUFG
Other:	Other than the businesses mentioned above

(2) Methods of calculation of net revenue, operating profit (loss), and fixed assets for each reporting segment

The accounting methods applied to the reported business segments, except the scope of consolidation, are generally consistent with the methods described in “1. Significant Accounting Policies Applied to the Semi-Annual Consolidated Financial Statements” above. The scope of consolidation includes MUFG’s major subsidiaries. The reported figures are generally prepared based on internal managerial accounting rules before elimination of inter-segment transactions and other consolidation adjustments. Net revenue and operating expenses attributable to multiple segments are reported in accordance with internal managerial accounting rules generally calculated based on market value.

Fixed assets for each reporting segment disclosed below represent the tangible fixed assets and intangible fixed assets related to the Bank and Mitsubishi UFJ Trust and Banking Corporation (“the Trust Bank”) as allocated to each reporting segment.

(a) Changes in the method of calculation of operating profit (loss) of each reporting segment

From the six months ended September 30, 2023, MUFG has changed the method of allocation of net revenue and operating expenses among reporting segments and has accordingly changed the method of calculation of operating profit (loss) of each reporting segment.

The business segment information for the six months ended September 30, 2022 has been restated based on the new calculation method.

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(3) Information on net revenue, operating profit (loss), and fixed assets for each reporting segment

For the six months ended September 30, 2022

	(in millions of yen)
	For the six months ended September 30, 2022
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group			Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group			Other			Total
Net revenue	¥	371,733	¥	283,766	¥	345,307	¥	447,356		¥	177,227	¥	345,501	¥	1,970,892	¥	360,582		¥	13,425		¥	2,344,900
BK and TB combined		127,217		194,596		277,501		27,253			53,008		247,436		927,013		225,605			23,524			1,176,143
Net interest income		106,744		90,800		153,024		27,326			5,252		114,465		497,613		604,640			57,778			1,160,032
Net non-interest income		20,472		103,796		124,476		(73	)		47,756		132,971		429,399		(379,035	)		(34,253	)		16,111
Other than BK and TB combined		244,516		89,169		67,806		420,102			124,219		98,065		1,043,879		134,976			(10,099	)		1,168,756
Operating expenses		259,067		227,557		165,759		304,966			123,384		168,359		1,249,095		136,287			69,919			1,455,302
Operating profit (loss)	¥	112,666	¥	56,208	¥	179,548	¥	142,389		¥	53,842	¥	177,142	¥	721,797	¥	224,294		¥	(56,494	)	¥	889,597
Fixed assets at period end		147,479		199,083		157,075		1,189			13,749		134,465		653,043		108,722			541,501			1,303,268
Increase in fixed assets		15,186		20,963		17,669		425			3,246		9,690		67,182		10,405			9,637			87,225
Depreciation and amortization		5,145		10,968		18,034		92			2,781		15,459		52,481		13,260			8,818			74,560

(Notes)

1. “BK” refers to MUFG Bank, Ltd. and “TB” refers to Mitsubishi UFJ Trust and Banking Corporation.

2. “Net revenue” in the above table is used in lieu of net sales generally used by Japanese non-financial companies.

3. “Net revenue” includes net interest income, trust fees, net fees and commissions, net trading profit, and net other operating profit.

4. “Operating expenses” includes personnel expenses and premise expenses.

5. “Fixed assets at period end” for each reporting segment in the above table represents those related to the Bank and the Trust Bank. Those fixed assets and consolidation adjustments related to MUFG and its other consolidated subsidiaries, which are not allocated to reporting segments, were ¥1,422,376 million. With respect to such fixed assets not allocated to reporting segments, certain related expenses are allocated to reporting segments on a reasonable basis.

6. “Increase in fixed assets” for each reporting segment in the above table represents such increase related to the Bank and the Trust Bank.

7. “Depreciation and amortization” for each reporting segment in the above table represents those related to the Bank and the Trust Bank.

60

For the six months ended September 30, 2023

	(in millions of yen)
	For the six months ended September 30, 2023
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group		Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group		Other			Total
Net revenue	¥	380,155	¥	318,751	¥	463,812	¥	310,910	¥	205,745	¥	418,376	¥	2,097,752	¥	381,747	¥	25,046		¥	2,504,547
BK and TB combined		124,346		220,041		376,766		19,571		56,826		376,632		1,174,185		229,374		106,234			1,509,794
Net interest income		106,854		115,088		237,447		19,054		6,529		195,639		680,614		119,321		86,585			886,522
Net non-interest income		17,491		104,952		139,319		517		50,297		180,993		493,570		110,052		19,649			623,272
Other than BK and TB combined		255,809		98,710		87,046		291,338		148,919		41,743		923,567		152,373		(81,187	)		994,753
Operating expenses		264,148		230,758		169,389		174,949		145,770		174,073		1,159,091		149,986		117,594			1,426,672
Operating profit (loss)	¥	116,006	¥	87,992	¥	294,423	¥	135,960	¥	59,975	¥	244,302	¥	938,661	¥	231,761	¥	(92,547	)	¥	1,077,875
Fixed assets at period end		172,797		210,956		161,030		1,353		22,127		168,391		736,656		108,417		531,870			1,376,944
Increase in fixed assets		19,063		20,806		22,335		197		7,329		15,855		85,588		13,148		15,296			114,033
Depreciation and amortization		6,987		11,995		21,223		114		4,024		21,780		66,125		15,481		8,636			90,243

(Notes)

1. “Net revenue” in the above table is used in lieu of net sales generally used by Japanese non-financial companies.

2. “Net revenue” includes net interest income, trust fees, net fees and commissions, net trading profit, and net other operating profit.

3. “Operating expenses” includes personnel expenses and premise expenses.

4. “Fixed assets at period end” for each reporting segment in the above table represents those related to the Bank and the Trust Bank. Those fixed assets and consolidation adjustments related to MUFG and its other consolidated subsidiaries, which are not allocated to reporting segments, were ¥1,344,467 million. With respect to such fixed assets not allocated to reporting segments, certain related expenses are allocated to reporting segments on a reasonable basis.

5. “Increase in fixed assets” for each reporting segment in the above table represents such increase related to the Bank and the Trust Bank.

6. “Depreciation and amortization” for each reporting segment in the above table represents those related to the Bank and the Trust Bank.

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(4) Reconciliation of the total operating profit in each of the above tables to the ordinary profit in the consolidated statement of income for the corresponding six-month period

	(in millions of yen)
	For the six months ended September 30,
	2022			2023
Total operating profit of reporting segments	¥	889,597		¥	1,077,875
Operating profit of consolidated subsidiaries excluded from reporting segments		(203	)		533
Provision for general allowance for credit losses		45,158			(121,516	)
Credit related expenses		(363,896	)		(109,791	)
Gains on reversal of allowance for credit losses		—			—
Gains on reversal of reserve for contingent losses included in credit costs		27,960			—
Gains on loans written-off		46,945			50,080
Net gains on equity securities and other securities		76,125			130,377
Equity in earnings of equity method investees		239,246			305,305
Others		(369,837	)		(52,956	)
Ordinary profit in the consolidated statement of income	¥	591,094		¥	1,279,907

(Note)

In connection with the planned sale of the shares in MUB, an aggregate of ¥631,861 million of losses were recognized for the six months ended September 30, 2022, primarily in accordance with ASC Topic 326, “Financial Instruments—Credit losses,” and ASC Topic 310, “Receivables.” These losses consisted mainly of ¥385,215 million of valuation losses related to securities held for sale, which were included in “Others,” and ¥232,571 million of valuation losses related to loans held for sale, which were included in “Credit related expenses.”

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II. Related information

For the six months ended September 30, 2022

(1) Information by type of service

Omitted because it is similar to the above-explained reporting segment information.

(2) Geographical information

(a) Ordinary income

(in millions of yen)
For the six months ended September 30, 2022
Japan		United States		Europe/Middle East		Asia/Oceania		Others		Total
	¥2,358,675	¥	844,590	¥	187,519	¥	806,720	¥	116,712	¥	4,314,217

(Notes)

1. Ordinary income is used in lieu of net sales generally used by Japanese non-financial companies.

2. Ordinary income is categorized by either country or region based on the location of MUFG’s operating offices.

(b) Tangible fixed assets

(in millions of yen)
September 30, 2022
Japan		Thailand		Others		Total
	¥990,701	¥	88,804	¥	188,809	¥	1,268,316

(3) Information by major customer

None.

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For the six months ended September 30, 2023

(1) Information by type of service

Omitted because it is similar to the above-explained reporting segment information.

(2) Geographical information

(a) Ordinary income

(in millions of yen)
For the six months ended September 30, 2023
Japan		United States		Europe/Middle East		Asia/Oceania		Others		Total
	¥2,361,861	¥	1,382,035	¥	557,453	¥	1,200,343	¥	163,968	¥	5,665,663

(Notes)

1. Ordinary income is used in lieu of net sales generally used by Japanese non-financial companies.

2. Ordinary income is categorized by either country or region based on the location of MUFG’s operating offices.

(b) Tangible fixed assets

(in millions of yen)
September 30, 2023
Japan		Thailand		Others		Total
	¥972,071	¥	98,354	¥	148,731	¥	1,219,157

(Changes in Presentation)

The amount of tangible fixed assets with respect to “United States” as of September 30, 2022, which was previously presented as a separate line-item, is included in “Others” as of September 30, 2023 due to its decreased significance. In order to apply this change in presentation, the information in “(b) Tangible fixed assets” under “(2) Geographical information” as of September 30, 2022 has been retroactively reclassified.

As a result, the previously presented amount with respect to “United States” as of September 30, 2022, which was ¥108,378 million, has been reclassified into “Others.”

In addition, the amount of tangible fixed assets with respect to “Thailand,” which was previously included in “Others” as of September 30, 2022, is presented as a separate line-item as of September 30, 2023 due to its relative increased significance in light of the decreased significance of “United States.” In order to apply this change in presentation, the information in “(b) Tangible fixed assets” under “(2) Geographical information” as of September 30, 2022 has been retroactively reclassified.

As a result, the previously presented amount with respect to “Others” as of September 30, 2022, which was ¥169,235 million, has been disaggregated and reclassified into ¥88,804 million for “Thailand” and ¥188,809 million for “Others.”

(3) Information by major customer

None.

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III. Information on impairment losses on fixed assets by reporting segment

For the six months ended September 30, 2022

	(in millions of yen)
	For the six months ended September 30, 2022
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group		Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group		Other		Total
Impairment losses	¥	1,093	¥	2,945	¥	13	¥	0	¥	—	¥	3	¥	4,056	¥	5	¥	686	¥	4,747

(Note)

Impairment losses on fixed assets related to MUFG and its consolidated subsidiaries other than those related to the Bank and the Trust Bank are not allocated to reporting segments. Such unallocated impairment losses for the six months ended September 30, 2022 were ¥2,091 million.

For the six months ended September 30, 2023

	(in millions of yen)
	For the six months ended September 30, 2023
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group		Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group		Other		Total
Impairment losses	¥	408	¥	1,755	¥	3,366	¥	0	¥	—	¥	7,101	¥	12,631	¥	1,505	¥	498	¥	14,634

(Note)

Impairment losses on fixed assets related to MUFG and its consolidated subsidiaries other than those related to the Bank and the Trust Bank are not allocated to reporting segments. Such unallocated impairment losses for the six months ended September 30, 2023 were ¥9,144 million.

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IV. Information on amortization and unamortized balance of goodwill by reporting segment

For the six months ended September 30, 2022

	(in millions of yen)
	For the six months ended September 30, 2022
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group		Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group		Other		Total
Amortization	¥	87	¥	130	¥	22	¥	1,635	¥	6,623	¥	1,724	¥	10,223	¥	—	¥	—	¥	10,223
Unamortized balance at period end		788		1,109		365		34,278		218,768		40,530		295,840		—		—		295,840

For the six months ended September 30, 2023

	(in millions of yen)
	For the six months ended September 30, 2023
	Digital Service Business Group		Retail & Commercial Banking Business Group		Japanese Corporate & Investment Banking Business Group		Global Commercial Banking Business Group		Asset Management & Investor Services Business Group		Global Corporate & Investment Banking Business Group		Total of Customer Business		Global Markets Business Group		Other		Total
Amortization	¥	87	¥	130	¥	22	¥	660	¥	6,790	¥	1,850	¥	9,542	¥	—	¥	—	¥	9,542
Unamortized balance at period end		13,222		848		321		47,450		210,415		40,074		312,331		—		—		312,331

V. Information on gains on negative goodwill by reporting segment

None.

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15. Business Combinations

None.

67

16. Per Share Information

I. Total equity per common share and the bases for the calculation for the periods indicated were as follows:

	(in yen)
	As of March 31, 2023			As of September 30, 2023
Total equity per common share	¥	1,433.11		¥	1,540.07
	(in millions of yen)
	As of March 31, 2023			As of September 30, 2023
Total equity	¥	18,272,857		¥	19,616,016
Deductions from total equity:
Non-controlling interests		1,041,565			1,094,809
Total deductions		1,041,565			1,094,809
Total equity attributable to common shares	¥	17,231,291		¥	18,521,206
	(in thousands)
	As of March 31, 2023			As of September 30, 2023
Number of common shares at period end used for the calculation of total equity per common share		12,023,645			12,026,200
II. Basic earnings per common share and diluted earnings per common share and the bases for the calculation for the periods indicated were as follows:
	(in yen)
	For the six months ended September 30,
	2022			2023
Basic earnings per common share	¥	18.50		¥	77.11
Diluted earnings per common share		18.32			76.89
	(in millions of yen)
	For the six months ended September 30,
	2022			2023
Profits attributable to owners of parent	¥	231,091		¥	927,281
Profits not attributable to common shareholders		—			—
Profits attributable to common shareholders of parent	¥	231,091		¥	927,281
	(in millions of yen)
	For the six months ended September 30,
	2022			2023
Adjustments to profits attributable to owners of parent	¥	(2,174	)	¥	(2,682	)
Adjustments related to dilutive shares of consolidated subsidiaries and others		(2,174	)		(2,682	)
	(in thousands)
	For the six months ended September 30,
	2022			2023
Average number of common shares during the periods		12,489,571			12,024,763
Increase in common shares		—			—

68

	For the six months ended September 30,
	2022	2023
Description of antidilutive securities which were not included in the calculation of diluted earnings per common share	Share subscription rights issued by equity method affiliates:	Share subscription rights issued by equity method affiliates:
	Morgan Stanley	Morgan Stanley
	Stock options and others — 6 million units as of June 30, 2022	Stock options and others — 2 million units as of September 30, 2023

III. The shares of MUFG common stock remaining in the BIP trust, which were included in the treasury stock as part of shareholders’ equity, were deducted from the average number of common shares for each reporting period used for the calculation of earnings per common share and from the number of common shares as of the end of each reporting period used for the calculation of total equity per common share. The average number of such treasury stock deducted from the calculation of earnings per common share for the six months ended September 30, 2022 and 2023 was 30,558 thousand shares and 27,283 thousand shares, respectively, and the number of such treasury stock deducted from the calculation of total equity per common share as of March 31, 2023 and September 30, 2023 was 28,407 thousand shares and 25,837 thousand shares, respectively.

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17. Subsequent Events

(Repurchase and cancellation of own shares)

MUFG resolved, at a meeting of the Board of Directors held on November 14, 2023, to repurchase shares of its common stock pursuant to the provisions of Article 156, Paragraph 1 of the Company Act, in accordance with the provisions of Article 459, Paragraph 1, Item 1 of the Company Act and Article 44 of its Articles of Incorporation, and to cancel shares of its common stock held in treasury in accordance with the provisions of Article 178 of the Company Act.

I. Reasons for the repurchase and cancellation of own shares

MUFG seeks to enhance shareholder returns primarily through dividends, while pursuing an optimal balance between effective capital management and strategic investments for growth.

MUFG intends to agilely engage in repurchases of shares of its own stock as a means to return profits to shareholders and improve capital efficiency, taking into account its business performance and capital position, opportunities for growth investments, and market conditions including stock prices. As a general policy, MUFG intends to cancel treasury shares to the extent that such shares exceed approximately 5% of its total issued shares (including treasury shares).

II. Outline of the repurchase of own shares

(1) Type of shares to be repurchased: Common shares of MUFG

(2) Aggregate number of shares to be repurchased: Up to 400,000,000 shares (equivalent to 3.31% of the total number of issued shares (excluding treasury shares))

(3) Aggregate amount of repurchase price: Up to JPY 400,000,000,000

(4) Repurchase period: From November 15, 2023 to March 31, 2024

(5) Repurchase method: Market purchases on the Tokyo Stock Exchange

III. Outline of the cancellation of own shares

(1) Type of shares to be canceled: Common shares of MUFG

(2) Number of shares to be canceled: 350,000,000 shares (equivalent to 2.75% of the total number of issued shares (including treasury shares) before the cancellation)

(3) Scheduled cancellation date: November 30, 2023

70