We strive towards providing financial products and services that are closely linked to community lifestyles, bringing a peace of mind, convenience, good value to the everyday lives of our customers.

AEON Financial Service Co., Ltd. and its subsidiaries (together hereinafter referred to as the “Group”) are a comprehensive financial group that grew out of AEON Group’s retail operations through integration of the commercial and financial sectors. Centering on the Company, which is a bank holding company, the Group currently consists of 34 consolidated subsidiaries and one equity-method affiliate in 12 Asian countries including Japan. The Group is constructing a dense network throughout countries of Asia, especially Japan, Hong Kong, Thailand and Malaysia. In addition to its approximately 700 sales bases in Japan and overseas, the network also includes AEON Group stores and affiliated merchants, with which the Group has built strong cooperative relationships.

Our Performance in FY2016

In domestic, , a slight improvement in consumer spending was observed due to a continuing trend of negative interest rate adopted by the Bank of Japan and a moderate increase in employee pay. Despite violent fluctuations in Asian currencies market due to rising uncertainty in the European economy and a risk avoidance trend due to the inauguration of a new administration in the US, there was a general appreciation of the yen currency over the fiscal year.

Overall, there was favorable growth in FY2016, where the domestic number of cardholders reached 26.92 million (up 1.04 million from the previous fiscal year), card shopping transactions volume at 4.51 trillion yen (up 10.0% from the previous fiscal year) and total savings deposits amount at AEON Bank 2.54 trillion yen. Furthermore, the number of AEON Card Select members exceeded 4 million while the number of bank accounts opened at AEON Bank reached 5.55 million.

As a result, there was a record high performance in FY2016, wherein the consolidated financial results for the fiscal year ended March 31, 2016, ordinary income was 375.1 billion yen (up 4.3% from the previous fiscal year), ordinary profit 61.6 billion yen (up 3.7% from the previous fiscal year), and net profit attributable to owners of parent 39.4 billion yen (up 10.3% from the previous fiscal year).

Drastic Change in the Economic Environment

Though we center our business in Asia, the economic environment where we operate in is being continuously influenced by world events in a real-time manner as the correlation between the international economies becomes even stronger in recent years.

In addition, our competitive environment is changing ever-rapidly with developments such as payment methods utilizing data analysis becoming full-fledged with Fin Tech leading the trend of digitalization.

Hence, in order to achieve sustainable growth, there is a need to continuously innovate to promptly respond to such changes in the external environment.

Our Efforts in Digitalization

We continuously strive towards enriching the daily lives of our customers by providing convenience and good value through financial services while leveraging on our strong alliance with the AEON Group. Our efforts in digitalization include the introduction of tablet devices to simplify the credit-card application process, and the AEON Wallet smartphone application which allows for checking of transaction statements, digital coupons and campaigns any time and place. We also held the AEON Financial Service Innovation 2016 hackathon contest to gather novel ideas and opinions from the general public to aid in the creation of new products and services, and started incorporating biometric identification in our ATMs as well as AI and blockchain technology in our demonstration experiments.

Striving towards becoming Asia’s No. 1 Retail Financial Services Company

Moving towards stronger efforts in digitalization in Japan and Asia, where we standardize databases incorporating both retail and financial elements and utilize AI for higher-level analysis, we will work towards building a common financial platform where financial products and services that suit to each individual customer’s needs can be provided in an even timelier manner.

With these initiatives, we aim to enrich the lifestyles of our customers by delivering products and services that suit their financial needs in every life stage.

Our Efforts in CSR

Part of the AEON Group, and with the management philosophy “Support customers’ lifestyles and enable each individual to maximize future opportunities through effective use of credit”, we have in place our CSR Policy and Environmental Policy. In view of the above policies, our Company promoted even more active involvement in CSR activities. Furthermore, based on the concept of environment, society and governance (ESG), we think ESG is similar to intangible assets such as customer base and brand, where raising the value of ESG as an intangible asset has the most impact on our corporate value.

Therefore, from this year onwards, we plan to set up a CSR Committee which can promote company-wide efforts more effectively, and in order to commit towards a sustainable environment and society, we will continuously contribute towards the environment and the region. In addition, we will strive towards more effectiveness and transparency through the completion of our corporate governance structure.

Closing Message

Our Group is continuously working to provide unique services that are not available in other financial organizations in Japan and Asia as a financial institution from retail business. Going forward, we will build a Group that is needed by its customers and thus look forward to our stakeholders’ ongoing support.

President and CEO
Kenji Kawahara