Contribution to Regional Revitalization to Solve the Challenges Facing the Community

SBI Group believes the national goal of regional revitalization is one of the urgent issues for the future of Japan and that regional revitalization is essential for realizing the growth of regional economies, and eventually, the development of the economy of Japan as a whole.
In its regional revitalization initiatives contributing to the resolution of issues faced by local communities, the SBI Group will further the collaborations and co-creation of value with its diverse partners, in addition to the multiple regional financial institutions – its existing alliance partners, thus escalating its efforts to help build a sustainable society.

Regional financial institutions are firmly rooted in local communities as the core of regional economies. However, their profitability has been declining due to the severe business environment partly reflecting the introduction of the negative interest rate policy in 2016 and the acceleration of the declining birthrate and the aging of the population. Regional financial institutions face issues including the sophistication of market operations, delays in the introduction of new financial services such as fintech, and growing system costs.

Under these circumstances, SBI Group has been building close relationships with regional financial institutions by utilizing its diverse management resources, based on the idea that the revitalization of regional financial institutions will lead to the revitalization of the regional economy as a whole since it identifies the issues and needs of local communities and resolves them. Collaborations with SBI Group have enabled partner regional financial institutions to improve their asset management and product development capabilities, as well as respond to the diverse asset management needs of local residents, of which they were unable to fulfill previously. In addition, our partner regional financial institutions have also improved their own profitability. We expect that by stimulating local residents' consumption and investment appetites through the utilization of the revitalized regional financial institutions, local industries will also benefit financially, leading to the development of the regional economy.

Regarding the alliances with regional financial institutions, the SBI Group has promoted not only business alliances but also strategic capital and business alliances via SBI Regional Bank Holdings. As of January 2024, SBI Group has entered into strategic capital and business alliances with nine banks, including The Shimane Bank, The Fukushima Bank, THE CHIKUHO BANK, The Shimizu Bank, THE TOWA BANK, Kirayaka Bank and THE SENDAI BANK – affiliate banks of Jimoto Holdings –, Tsukuba Bank and THE TAIKO BANK. The Group strives to fully support the regional financial institutions that the Group has invested in as they endeavor to qualitatively transform through self-transformation and self-evolution through these strategic capital and business alliances. Meanwhile, the SBI Group serves in tandem with the partner financial institutions to provide solutions and make improvements to address the issues they face, including the utilization of the Group's management resources. The SBI Group forms strategic capital and business alliances because it believes that these alliances will enable it to contribute more deeply to the improvement of the corporate value of regional financial institutions. The goals of these alliances are to accurately understand the issues faced by these financial institutions and offer the Group's knowledge and expertise to solve the problems and verify the effects in a timely manner.

The SBI Group believes that there are still many cases where the solutions to the issues faced by regional financial institutions will contribute to revitalizing the local community as a whole. The Group will continue striving to improve regional financial institutions' corporate value and to revitalize regional economies through its expansion and deepening of its partnerships with them.

While pursuing alliances with regional financial institutions, the SBI Group believes that to resolve issues faced by local economies it must directly approach not only regional financial institutions but also the three other economic entities: local residents, local industries and local governments. The Group has therefore established Regional Revitalization Partners in collaboration with multiple partner companies that share the same aspiration to achieve regional revitalization. Regional Revitalization Partners is a controlling body that formulates and advances efforts and strategies toward regional revitalization. It endeavors to contribute directly to the revitalization of regional economies through the involvement of an array of partners.
Furthermore, SBI Regional Revitalization Services and SBI Regional Revitalization Investment and Loan have been established as the entities providing a wide variety of functions contributing to regional revitalization. SBI Regional Revitalization Services has been advancing specific initiatives related to the revitalization of local industries, the creation of new revenue-generating opportunities and others. Meanwhile, SBI Regional Revitalization Investment and Loan has been advancing the sophistication of the management capabilities that has been provided by the SBI Group and provide them to regional financial institutions, let alone play the role in providing investment and loans to venture companies contributing to regional revitalization.

SBI Regional Revitalization Banking System also has been promoting the development of cloud-based account systems for regional financial institutions and the development and provision of the SBI Common ATM Service, a common ATM service for regional financial institutions, to support the fundamental transformation of regional financial institutions from a systems perspective.

Regional Revitalization Partners (Japanese only)
SBI Regional Bank Holdings (Japanese only)

Since becoming a consolidated subsidiary in December 2021, SBI Group and SBI Shinsei Bank Group have been thoroughly promoting the "Triangle Strategy," which utilize the functions of SBI Group, Shinsei Bank Group, and regional financial institutions that form a three-pronged strategy.
The "Triangle Strategy" seeks to achieve a "four-way" advantage for these three parties and the region through the following initiatives. (i) Regional financial institutions utilize their own brand power in the region to uncover business needs (ii) For those business needs, SBI Group mainly provides the cutting-edge technology and know-how possessed by the Group or the investee companies and the Group's extensive business network, while SBI Shinsei Bank Group provides the banking and non-banking functions.

In the future, SBI Group will further evolve its approach to the regional revitalization in a way that incorporates the SBI Shinsei Bank Group. Specifically, regardless of whether or not there is a capital alliance, SBI Group will pursue the benefits of increased efficiency and expanded business scope through extensive collaboration between SBI Group and regional financial institutions nationwide, in order to achieve the concept of a wide-area regional platformer with SBI Shinsei Bank as its core. SBI Group defines this concept as the "Fourth Megabank concept". Through the promotion of this concept, SBI Group will contribute to the expansion of the profitability of regional financial institutions and, ultimately, to the sustainable development of regional economies.