Message from the Management

Message from the Management

The Basic Role of the Bank as the Central Institution for Cooperatives

As the national-level financial institution for agricultural, fishery and forestry (“AFF”) cooperatives in Japan, the mission of the Bank is to contribute to the development of the AFF industries and to national economic prosperity by facilitating access to financial resources. The Bank, to achieve its mission, lends funds to its members—farmers, fishermen and foresters—and companies related to the AFF industries, using the funds provided by Japan Agricultural Cooperatives (JA), Japan Fisheries Cooperatives (JF), Japan Forest Owners’ Cooperatives (JForest), etc., as well as the stable funding base through customer deposits at JA Bank and JF Marine Bank. The Bank also conducts various lending and investment activities in Japan and abroad, efficiently manages funds and stably returns profits to its members.

Moreover, the Bank provides various services to support the cooperative banking business of JA and JF, including the planning and implementation of policies and initiatives, development of human resources and provision of business infrastructure. The Bank also provides operational guidance for the cooperative banking business based on the relevant rules and regulations and continues to build and maintain the safety net for the JA Bank and JF Marine Bank systems. The Bank continues to further improve the credibility of its cooperative banking business, while playing the important role of strengthening and expanding the cooperative banking business.

Operation of the Medium-Term Management Plan (FY2019–FY2023)

The environment surrounding the Bank and the cooperatives is increasingly harsh amid such developments as global profit margin compression and accelerating digitalization. Meanwhile, public interest in and expectations for turning the AFF industries into growth industries are higher than ever before.

Considering the situation surrounding the Bank and cooperatives and the basic role of the Bank, we have formulated the Medium-Term Management Plan (FY2019-FY2023), outlining our management and business operation policies for the five-year period, and conducted business operations based on the Plan.

Formulation of the Purpose of the Bank and the Medium/Long-Term Goals

Given increasingly serious environmental and social issues— including climate change and the transformation in people’s work styles, lifestyles and values through the COVID-19 pandemic—the landscape for the Bank and the AFF industries, which are a foundation of the Bank’s operation, continues to change rapidly. We have therefore redefined the Bank’s Purpose to be “Dedicated to sustaining all life. – Work together with our stakeholders to foster the AFF industries and to create a prosperous future for food and lifestyles, and thereby contribute to a sustainable global environment –,” reflecting the Bank’s vision, value and role that it can offer society. To realize this Purpose, the Bank has established the Medium/Long-Term Goals toward 2030 to improve the income of farmers, fishermen and foresters and reduce greenhouse gases (GHG) emissions. Based on the Purpose of the Bank, we will conduct daily business operation to grow with our stakeholders by achieving the Medium/Long-Term Goals 2030.

Finally, JA Bank, JF Marine Bank, JForest Group and the Bank will continue to perform their unique roles and functions as cooperatives with the goal of becoming financial institutions and organizations that win the confidence of their customers. We ask for your continuing support as we strive for our goals.

July 2021

Chairman of the Supervisory Committee
Toru Nakaya

President and Chief Executive Officer
Kazuto Oku

Message from the CEO

Financial Results and Capital Adequacy in Fiscal 2020

In fiscal 2020, the Bank recorded ordinary profit of ¥310.0 billion and profit attributable to owners of parent of ¥208.2 billion, showing steady profitability, reflecting a decline in foreign currency funding costs and as a result of our financial management efforts to enhance earnings steadily.

The Bank’s capital adequacy ratios on a consolidated basis were maintained at a high level, with a common equity Tier 1 capital ratio of 19.86%, a Tier 1 capital ratio of 23.19% and a total capital ratio of 23.19%.

  FY2018 FY2019 FY2020

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Profit Attributable to Owners of Parent




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Business Performance in Fiscal 2020

Throughout fiscal 2020, the Bank adhered to its vision of becoming “the leading bank that supports the AFF industries, food production and consumption, and the daily lives of local communities” as outlined in the current Medium-Term Management Plan (FY2019-FY2023). In order to achieve its goals even in a severe environment, the Bank has made progress in establishing value chains by offering solutions, providing functions for the development of local communities and member organizations, and establishing a sturdy business model that is resilient to economic fluctuations.

At the financial markets, while short-term interest rates declined globally against the backdrop of accommodative monetary policies across major jurisdictions, interest rates rose with the expectation for extensive fiscal policies among others, mainly led by U.S. Treasury bonds. Stock prices rose, recovering from a plunge caused by the spread of the COVID-19 infection and a subsequent adjustment phase. In the foreign exchange market, an increase in interest rates and stock prices has led to yen depreciation against both the U.S. dollar and the euro. In such circumstances, the Bank continued the stable return of profit to its stakeholders and worked to provide stable financing for the AFF industries and related local communities—a foundation for the Bank’s operation.

In addition, the Bank undertook various measures throughout the fiscal year that included; offering solutions to contribute to the growth of the AFF industries and related communities; expanding agricultural financing; reinforcing and extending its global customer base with a focus on Asia; enhancing JA Bank’s business base and JF Marine Bank’s financing functions for the fishery industry; performing main-bank functions for JF and JForest; expanding ESG investments; and enhancing corporate functions to support each business line.

Measures to Address the Spread of COVID-19

The AFF industries—the foundation of the Bank’s business— have been seriously affected by the spread of COVID-19.

As a member of JA Bank and JF Marine Bank, the Bank offers smooth financing for AFF business operators such as continuing to handle low interest rate financing.

In addition, the Bank will continue to offer nonfinancial services such as helping to find sales channels to eliminate excess inventories of agricultural produce, etc., in alliance with government agencies and related organizations.

Status of Implementation of the Medium-Term Management Plan (FY2019–FY2023) and the Bank’s Vision

The Bank is conducting business operations based on its Medium-Term Management Plan “Catch the Winds of Change. Create New Value,” covering five years (FY2019-FY2023).
We predict that our business environment will face non-continuous changes in the next 10 years, such as global profit margin compression, accelerating digitalization, aging leaders in the AFF industries, the need for scale expansion, growth in Asia and environmental and social issues. Recognizing the necessity to enhance profitability, provide comprehensive services that customers want, effectively support leaders in the AFF industries, deepen our global business network and offer value to society, the Bank continues tackling the challenging creation of new value toward solving these issues.

Outline and Priority Strategies of the Medium-Term Management Plan (FY2019–FY2023): Aiming to Become a “Leading Bank That Supports the AFF Industries, Food Production and Consumption, and the Daily Lives of Local Communities”

Since our establishment in 1923 as a national-level financial institution to help our foundational entities— AFF cooperative organizations—we have contributed to the development of the AFF industries, and a key milestone—our 100th anniversary—is just around the corner. In our first hundred years, the environment surrounding the AFF industries experienced significant changes and unprecedented “non-continuous changes” are likely in the future. To continue to fulfill our mission of contributing to the development of the AFF industries in such an environment, we will deepen dialogues with cooperative members and tackle our challenging “Catch the Winds of Change. Create New Value” plan under the following basic policy and priority strategies. Through such efforts, together with our cooperative groups, we will strive to meet the expectations of our customers, realize sustainable growth and offer value to society.

Core Principle

Priority Strategies

Our Purpose, Vision and Mission

In 2017, the Bank formulated a corporate brand statement “Dedicated to sustaining all life,” expressing that the Bank’s business exists together with “life,” which is sustained by AFF business operations and the cycle of nature.

These industries and the food and agricultural value chains have been seriously damaged because of the COVID-19 pandemic. Environmental issues such as climate change and various social issues have surfaced. There is pressure to address these issues through our business operations.

In such circumstances, the Bank revisited its purpose (what contributions the Bank should make for sustainable environment and society of the future) and its vision (what the Bank should do to perform its purpose). The Medium/Long-term goals and single-year goals are included in the Management Plan of the Bank to achieve its vision.

The Bank also identified key “shared values” of its officers and employees, which form the foundation of daily business activities to achieve the management plan.

Based on these “shared values,” the Bank conducts daily business activities to achieve the goals of its Management Plan and the Medium/Long-Term Goals. Such efforts are a path to achieve the Bank’s vision and accomplish the Bank’s purpose in society. Sharing such understanding among officers and employees throughout the Bank, we engage in daily business operation.

Medium/Long-Term Goals FY2030

To achieve the Purpose of the Bank, via the Medium/ Long-Term Goals FY2030, the Bank aims to “reduce GHG emissions by 50% (compared with FY2013)” and “improve the income of farmers, fishermen and foresters.”

Concerning the reduction of GHG emissions, we strive to reduce emissions at the Bank’s investees and borrowers and the Bank itself. Also, we work to increase absorption of CO2 via forests in alliance with JForest cooperatives.

Toward achieving these goals, the Bank will execute ¥10 trillion in new sustainable finance by FY2030.

In addition, as part of an effort to establish an organizational foundation to work on sustainability management, the Bank aims to increase the ratio of female managers.

Sustainability Management Initiatives

Public interest is rapidly rising in the areas of the global population increase, the aging and shrinking population in advanced countries, climate change, and issues of economic disparity and poverty. To address this situation, global initiatives aiming to achieve a sustainable society are under way, such as the Sustainable Development Goals (SDGs) by the United Nations and the Paris Agreement. Against this backdrop, expectations are on the rise for corporations to take measures to address such social issues.

Based on an understanding of such global trends, the Bank is discussing measures for sustainability management at the Sustainability Committee, which operates under the Board of Directors, and implementing such measures.

In fiscal 2020, toward ensuring the sustainability of the AFF industries and related local communities, the Bank has established five priority issues and worked to enhance environmental and social risk management such as strengthening ESG investments and finance, expanding sector policies for investments and loans. In fiscal 2021, the Bank continues to work to realize a sustainable society based on the Medium/Long-Term Goals 2030, which were newly formulated from medium- to long-term perspective toward accomplishing the Purpose of the Bank.

(For details, see our Sustainability Report 2021.)

Measures to Address Climate Change

The AFF industries—the foundation of the Bank’s business—could be affected negatively by climate change, while at the same time possessing the underlying potential to increase climate change. Addressing climate change is part of the Bank’s mission to contribute to the development of these industries. In April 2019, the Bank publicly endorsed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), which was established by the Financial Stability Board(FSB). The Bank will appropriately address the impacts and risks of climate change on the Bank’s businesses, implement measures and expand disclosures in line with the TCFD recommendations over time.

The Bank’s Sustainability Topics (Five Focus Areas and 14 Topics)

Five Focus Areas 14 Topics
(Focus Area 1)
Creating positive impact on the agriculture, fishery and forestry industries, food and local communities
> (Topic 1-1) Contributing to sustainable agriculture, fishery and forestry industries
> (Topic 1-2) Contributing to safe and secure food supply
> (Topic 1-3) Contributing to sustainable local communities
> (Topic 1-4) Conserving the natural environment as a foundation of the agriculture, fishery and forestry industries
> (Topic 1-5) Creating business innovation
(Focus Area 2)
Promoting responsible finance
> (Topic 2-1) Promoting sustainable finance
> (Topic 2-2) Contributing to sustainable energy utilization
> (Topic 2-3) Realizing financing for everybody
(Focus Area 3)
Promoting sustainability management
> (Topic 3-1) Ensuring a transparent organizational governing structure
> (Topic 3-2) Reinforcing the management of environmental and social risks
> (Topic 3-3) Reinforcing stakeholder engagement
(Focus Area 4)
Securing highly capable human resources
> (Topic 4-1) Improving diversity and equal opportunities
> (Topic 4-2) Enhancing human resources development
(Focus Area 5)
Maintaining customer trust as a financial institution
> (Topic 5-1) Further reinforcing the compliance framework


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