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AGENDA

AGENDA. ◆Overview of Business for First Half of FY 2005. Ⅰ ． Overview of Business. Ⅱ ． Explanation of Revisions to Perforation Estimates. ◆Management Strategy for FY 2005. The figures contained in this document, which describe the outlook of business etc, are

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AGENDA

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  1. AGENDA ◆Overview of Business for First Half of FY 2005 Ⅰ．Overview of Business Ⅱ．Explanation of Revisionsto Perforation Estimates ◆Management Strategy for FY 2005 The figures contained in this document, which describe the outlook of business etc, are projected calculations based on conclusions and suppositions according to the information currently available to us. Future actual business results may differ substantially from the projections described here due to the inherent uncertainty of such conclusions and suppositions, as well as variable factors such as future business operations and/or economic conditions. CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  2. Half-Year Financial Report for FY 2005 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  3. CONTENTS ◆ Financial Report for FY 2005 Ⅰ．Overview of Business １．Highlights ２．Operating Results ３．Credit Risk Trends ４．Financial Indices ５．Main Indices (Non-Consolidated) 1 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  4. １．Highlights of First Half of FY 2005 ◆Non-consolidated ☆Consolidated First and Second Quarter ◇ Start of operation at new credit center “Ubiquitous” ◇ Started issuing “Mizuho Mileage Club Card SAISON” through alliance with Mizuho Financial Group ◇ Started new “Prince Card” through alliance with PRINCE HOTELS, INC. ☆ Capital and business alliance with Mitsubishi Corporation. Transferred direct marketing business of Saison Direct Marketing ◇ Alliance with Tokyo Electric Power Company: card payment of electricity bills from September ☆ Co-development of “Auto Insurance” with Saison Automobile and Fire Insurance ☆ JPN Service Co., Ltd., encouragement of national pension premium payment by telephone, commissioned by Niigata Social Insurance Bureau ◇ Started “SAISON Wedding Story” web-based wedding information service ◇ Started new TV commercial, “Disdain” (The Giant Swing) in Paris and London ◇ Started the SAISON Platinum American Express Card ◇ Formed alliance with Sumitomo Trust & Banking to launch term deposits with SAISON Permanent Points◇ Began offering call loans with securities as collateral ◇ Started issuing “Chojo-SAISON Credit Card” through the tie-up with Bank of China ☆ JPN Servicer Co. Ltd. municipal tax formal notice by telephone, etc., commissioned by Sakai City government, Osaka prefecture ◇ Merger with UC CARD Co. Ltd. in January Third Quarter 2 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  5. ２．Business Results ()=YOY Consolidated Non-Consolidated First Half of FY 2004 Operating revenues \117.2 billion (108%) \92.8billion (107%) First Half of FY 2005 \100.0billion (108%) \127.8billion (109%) Ordinary income First Half of FY 2004 \28.0 billion (113%) \22.9billion (109%) First Half of FY 2005 \35.0 billion (125%) \24.9 billion (109%) \15.8 billion (121%) \14.2 billion (116%) Net income First Half of FY 2004 First Half of FY 2005 \20.7 billion (130%) \14.7billion (103%) 3 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  6. Results by Business Segment Units: Billion yen% （百万円） 4 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  7. Contribution to Consolidated Results Consolidated Trends Contribution to Consolidated Results (Units: Billion yen; times) Ordinary income: Consolidated/Non-consolidated difference (Units: Billion yen) CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  8. Operating Revenues (Consolidated/Non-Consolidated) ◆With strong performance in every segment, consolidated operating revenue came in at ¥3.8 billion higher than initial targets. 【 Consolidated 】 【Non-Consolidated】 Unit: Billion yen Unit: Billion yen 266.0 240.4 220.3 214.0 214.8 212.2 190.2 175.7 171.8 154.2 ＋10.6billion yen +9% YOY ＋7.2 billion yen +8% YOY 6 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  9. Ordinary Income (Consolidated/Non-Consolidated) ◆Surpassed initial targets by ¥7.0 billion (consolidated) and ¥2.0 billion (non-consolidated) as a result of effect from parent-company cost-cutting and strong performance at consolidated subsidiaries, including companies accounted for by equity method 【Non-Consolidated】 【 Consolidated 】 Unit: Billion yen Unit: Billion yen 50.0 64.0 59.6 56.5 47.0 52.9 45.0 44.3 41.1 51.0 ＋0.7billion yen +25% YOY ＋2.0billion yen +9% YOY 7 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  10. Net income (Consolidated/Non-Consolidated) ◆Surpassed initial targets by ¥4.7 billion (consolidated) and ¥1.0 billion (non-consolidated) 【Non-Consolidated】 【 Consolidated 】 Unit: Billion yen Unit: Billion yen 22.0 31.8 25.8 24.3 15.0 22.4 13.3 △12.0 15.3 ▲5.0 18.2 △15.0 ▲6.0 12.2 ＋0.5billion yen +3% YOY ＋4.9billion yen +30% YOY CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD. 8

  11. ３．Credit Risk Trends① ■The trend has cooled down in delinquent receivables of over 90 days. *Delinquency rate: Percentage of total receivables past due 90 days or more. 【 Consolidated 】 【 Non-Consolidated 】 Cash advances delinquency rate Total credit card delinquency rate Shopping delinquency rate 9 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  12. Credit Risk Trends ② ■Credit Costs （　）First half year 【 Consolidated 】 【 Non-Consolidated 】 Billion yen Consolidated figures are aggregate delinquency costs. Billion yen Write-off 44.8 Write-off Revised number Net increase in allowance for bad dept 39.5 37.3 Revised number （18.1） （19.1） 36.3 1.6 （1.4） 28.3 21.4 （21.4） （20.9） （167） （158） 10 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  13. ４．Financial Indices Ratings R&IA+ S&PA- • Stability　→　Shareholders’ equity ratio steady • Profitability → Reached medium-term target of 10% consolidated ROE （　）First half year 【 Consolidated 】 【 Non-Consolidated 】 Shareholders’ equity ratio 株主資本比率 Shareholders’ equity ratio （6.6%） （5.4%） （6.0%） （0.7%） （5.3%） （0.8%） （5.0%） （4.8%） 11 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  14. Funding Structure ① 【 Consolidated 】 【 Non-Consolidated 】 12 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  15. Funding Structure ② 【 Consolidated 】 【 Non-Consolidated 】 13 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  16. ５．Main Indices for First Half of FY 2005 () = Y O Y ① New applications 1.39 million (122%) ② New cards issued 1.17 million (120%) ③ Total card members +600,000 from end of previous period 17.50 million (107%) ④ Active card members +320,000 from end of previous period 9.15 million (107%) ⑤ Transaction volume \1,385.4 billion (111%) \1,112.8 billion (112%) Card shopping \272.6billion (105%) Card Cash advances 14 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  17. ＋250,000 112% YOY ① New applications ◆Exceeded plan, reflecting positive trends in new credit card applications, including new affinity cards Units: Million 2.7 2.7 2.4 2.5 2.1 15 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  18. ＋190,000 119% YOY ② New cards issued ◆Nearly in line with plan, reflecting steady new card applications. Units: Million 2.5 2.4 2.3 2.1 1.9 16 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  19. ③Total card members & ④ Active card members ◆Increase in activity at start of period and expansion of ongoing payment of utility bills, etc., helped to boost number of active cardholders Units: Million Total card members Revised number Active card members ＋600,000 15 ＋320,000 920 17 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  20. ＋132,000 111% YOY ⑤ Transaction volume ◆Target for fiscal year revised upward by ¥12.0 billion due to improved external environment and marketing efforts Units: Million Total card members Revised number 2,862 Active card members 2,596 2,409 2,343 2,121 18 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  21. ＋59,000 104% YOY ＋194,000 105% YOY ⑥ Credit loan outstanding ◆Minor adjustment in full-year target due to adjustment of card transaction volume Units: Million ABS (Cash advance) Cash advance ABS (Shopping) Revised number 629 617 542 575 592 △30 19 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  22. Ⅱ．Explanation of Revisions to Performance Estimates ■Explanation of Revisions to Performance Estimates Units: Million Operating revenues Ordinary income Consolidated Net income Operating revenues Ordinary income Non-Consolidated Net income 20 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  23. Management Strategies FY 2005 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  24. CONTENTS ◆ Management Strategies FY 2005 1. Using Alliances to Stimulate the Card Business 2. New Growth Drivers 3. The Group’s Full Power and Future Initiatives 21 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  25. 1. Using Alliances to Stimulate the Card Business ■Stimulating Effects of Affinity Cards Sales Division“Area marketing” (Uses regional characteristics) Credit Division“Outbound approach” (Promotes activity) Credit Card Division “Client linkage”(Increases no. of cardholders and use) “Three-in-One” structurestrengthens sales organization Specific results of “Three-in-One” structure • Promotion in conjunction with opening of “Shinsaibashi Sogo” (Osaka) • Achieved brand image penetration in local area • Acquired many new cardholders　⇒ 25,000 new card applications before store opening New applications increased 60% YOY • Enhancement of alliance with Takashimaya • Increased use of SAISON Card　⇒ 40% YOY increase in SAISON card use at Takashimaya • (one of the top 10 cards used in large-scale affiliate stores) • Reinforcement of “Outbound approach” • Promoted activity for new card members with “Thanks Call” • ⇒　4% increase in shopping transactions within first three months 22 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  26. 1. Using Alliances to Stimulate the Card Business ■Becoming No. 1 Card to Activate Card Use Recurring payment use (as of Sept. 2005) • Number of cardholders using card for recurring payments (utility fees, mobile phone bills, newspaper subscriptions, cardholders’ insurance premiums) Recurring payment users: 1,320,000 members (+ members 45% YOY ) Usage ratio (proportion of active cardholders): 14% (+ members 4% YOY) • Use of credit card to pay mobile phone bills Number of users: approx. 800,000 members Usage rate (proportion of active cardholders): approx. 9% Phone companies: NTT DoCoMo, KDDI, Tu-ka Cellular, au, Vodafone, WILLCOM Effect on card use (comparison of use six months before to six months after commencement) Six-month period before using recurring payment Six-month period after commencing use Effect Amount charged monthly Yearly account value ¥38,000 ¥463,000 ¥45,000 ¥546,000 ¥7,000 ¥83,000 ↑ ↑ Note: Figures exclude charges for mobile phone use. 23 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  27. 1. Using Alliances to Stimulate the Card Business ■Alliance-based Growth Strategy Appeal to wealthy customers Alliance with hotel industry’s top-class Prince Hotels: Reinforced highly loyal customer base new “Prince Card” Strengthening T&E services to offer higher status: Acquired new premium card users SAISON Platinum American Express Card Appeal to male customers Tie-up with K-1, leading sport of the martial arts boom, to appeal to highly entertainment-oriented segment Attracted male sports fans 「Ｋ－１SAISON Card」 24 CORPORATESTRATEGY2005CREDITSAISONCO.,LTD.

  28. 1. Using Alliances to Stimulate the Card Business ■Alliance-based Growth Strategy Business alliances • Measures to raise added value of credit cards T&E Securities Insurance Investment ○Commenced sale of term deposits with SAISON Permanent Points: “SAISON Sumishin Money Club” ○Developed automobile insurance exclusively for cardholders: “Auto Insurance” ○Increased number of locations offering securities brokerage services Overseas alliances First approach to issuing cards in the expanding Chinese market Formed alliance with Bank of China, targeting Japanese expatriates in Shanghai Issued credit card that permits transactions in yuan • Issuance of “Chojo-SAISON Credit Card” 25 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  29. 2. New Growth Drivers ① Joint Card with Mizuho Bank Use of MMC Card SAISON Analysis of cards issued May-September Customer segment Shopping activity Usage through September for cards issued in May Promotion development • 1st Step ⇒ Begin acceptance of applications for people opening new accounts at branches • 2ndStep　 ⇒ Start of in-branch service for customers with Mizuho Bank customers (Pilot project at 30 branches) • (Future development) • 3rdStep　⇒ Expand in- branch development to 100 stores nationwide →　Enhance ability to secure new customers • Introduction of newly designed card face　 → Raise card usage • Introduction of AMEX brand →Secure T&E and wealthy customers Newly issued cards 26 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  30. 32% 34% 34% Others 2. New Growth Drivers ② Merger with UC Card We will leverage economies of scale to conduct aggressive sales and rapid business development, as we aim to capture the top industry share with support from customers. January 2006 November 2005 October 2005 Top industry share 91% 【Credit Saison Co., Ltd.】 End of March 2005 Became a subsidiary Issuer dept. 100% Credit Saison Co., Ltd. Issuer dept. ＋ 28% Issuer dept. Merger Company separation UC 32% Application of equity method Application of equity method Others Application of equity method Processing company【UC CARD Co., Ltd.】 27 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  31. 2. New Growth Drivers ■Effect of Merger with UC CARD Co., Ltd. Unit: Billion yen Notes: 1 = Balance Sheet: Figures at time of company separation in October 2005 2 = Profit and Loss: Projected figures for year ending March 2006 (includes 3-month contribution of UC Card results for January-March)3 = Includes securitization Parentheses indicate target for full fiscal year * Full-year transaction volume target includes January-March portion 28 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  32. 2. New Growth Drivers ■Aiming to be the No. 1 Card Company Marketing Operations External environment Know-how ＜Network＞ ＜Customer＞ ・E-money ・IC cards ・Debit card ・security ・Client needs ・Customer preferences ・Online services Distribution network that organizes preferred customers Female customersYoung generation Customer service related know-how Client settlement related know-how ＋ ＋ Banking network with many blue-chip companies Corporate membersBusiness people Integration of financial and retail services Innovative marketing concepts All-encompassing customer platform Most powerful retail business channel Next-generation system Supporting companies Become the strongest third-party processor Capture the top industry share 29 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  33. 3. The Group’s Full Power and Future Initiatives ■Strengthening Finance-Related Businesses While strengthening existing businesses in response to market needs, we will promote diversification of our revenue base by leveraging our know-how. Progress and targets of businesses ※Saison Fundex －New Product Lineup－ ■　Began offering call loans with securities as collateral 　 ■　Introduction of medium-sized loans 30 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  34. 3. The Group’s Full Power and Future Initiatives ■Asset Value Enhancement Business (Use of people, equipment, know-how and other assets on hand) In addition to promoting business reinforcement through alliances and M＆As, we will build growth strategies in the business areas of each company, including the use of IPOs. Progress of each company Unit: Billion yen Restructuring of direct marketing business Investment 20% Mitsubishi Corporation Credit Saison Co., Ltd. Conducts cross-media commerce business through television, Internet and other consumer sales channels for SAISON cardholders as well as general consumers 100% 66% Saison Direct Marketing Co., Ltd. Digital Direct Corp. Mail order business transfer 31 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

  35. 3. The Group’s Full Power and Future Initiatives ■Joint Venture Alliance Businesses Turn Profitable Joint venture companies on track to contribute to consolidated profits as income in equity of affiliated companies Parentheses indicate fiscal year target 32 CORPORATESTRATEGY　２００５　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　　CREDITSAISONCO.,LTD.

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