Compliance

Basic Policy

Aozora will anticipate and accurately grasp changes in multiple risks in the internal and external environments, comply with all laws and regulations as they pertain to its business operations, and sincerely engage in corporate activities that conform to social norms, business practice, and the perspectives of users. To prevent our corporate value from being damaged by fraud or scandal, we will also work diligently to continuously improve and enhance our internal control functions while raising awareness toward compliance among our officers and employees. In similar fashion, we will further enhance our management systems for compliance and legal risks, including conduct risk.

Management Structure

Aozora has a Compliance Management Division and a Legal Division in place as the supervising divisions for compliance and legal risks, and these divisions develop internal rules regarding compliance. The two divisions also conduct seminars and e-learning periodically to maintain and improve compliance awareness. As a specific action plan to realize our compliance framework, the Compliance Management Division develops annual compliance programs that are disseminated and implemented throughout the Group. The progress and achievement status of these programs are reported to the Board of Directors on a semi-annual basis. Aozora has also established a Code of Ethics and Conduct as a standard of conduct that every officer and employee must remain in compliance with. All Group officers and employees pledge on an annual basis that they understand and comply with the Code of Ethics and Conduct.

Customer-oriented Business Management

Aozora has established and disclosed its Basic Policy on Customer-Oriented Business Management in order to provide products and services that meet the true needs of customers, always from the standpoint of customers, and conduct business in a sincere and fair manner. In addition, for our retail business, specific action plans based on this policy are separately established, reviewed semi-annually, and the status of the initiatives are also disclosed on a semi-annual basis.
With regard to its product governance framework, Aozora has put in place a system in which it makes decisions on the introduction of products and services with the involvement of the management bodies such as the Customer Committee. The Bank also reviews or discontinues products or services as necessary as a result of ongoing post-launch evaluations.
Based on the basic policy, Aozora strives to develop highly specialized human resources to ensure that it can propose and provide the most suitable products and services to its customers. In addition, the Customer Committee reviews and discusses matters related to customer-oriented business management as well as the status of customer protection management and reports the results of these reviews to the Management Committee, the Board of Directors, and other bodies as necessary.

Elimination of Anti-social Elements
Anti-money Laundering Initiatives

Aozora clearly states in the Basic Policy on the Elimination of Anti-Social Elements that it categorically blocks any relationship with anti-social elements. Aozora has established close cooperative relationships with outside specialized agencies, including law enforcement agencies and attorneys. On this basis, the Bank does not tolerate any form of business relationship with anti-social elements.
Moreover, with respect to the prevention of financial crimes, including money laundering, the financing of terrorism, proliferation financing, and compliance with economic sanctions under the Foreign Exchange and Foreign Trade Act (Anti-Money Laundering Measures), we have adopted and declared the Aozora Bank Group Basic Policy on Anti-Money Laundering and are continuously working to enhance our controls.

• Aozora Bank Group Basic Policy on the Elimination of Anti-Social Elements
• Aozora Bank Group Basic Policy on Anti-Money Laundering

Addressing the Threat of Special Fraud and Fraudulent Use of Bank Accounts

With special fraud running rampant across Japan, the number of victims and value of damages have been rising continuously.
Against this backdrop, Aozora has taken a strict stance against fraudulent use of bank accounts through the following actions in order to ensure customers can use their accounts safely and with peace of mind.

• Uncompromising verification of customers’ identity, purpose of transaction, and occupation when opening new accounts
• Ongoing monitoring of customer status for existing accounts
• Day-to-day monitoring
• Where any suspicious indications are identified, refusal of the relevant transaction and future transactions, as well as swift reporting to the authorities as a suspicious transaction

Insider Trading Prevention

To prevent insider trading by officers and employees, steps are taken to strictly manage the information obtained in the course of business and to regularly provide training to officers and employees on the prevention of insider trading. In addition, all Group officers and employees pledge every year to comply with Internal Rules on insider trading prevention.

Compliance-related Awareness Activities

To maintain and improve compliance awareness among our officers and employees, we conduct training and e-learning on an ongoing basis.
In FY2025, we provided a total of 24 training programs (eight of which were intended for all Group officers and employees). The attendance rate for training intended for all Group officers and employees was generally 100%. Moreover, we conduct monthly e-learning programs on compliance to provide basic knowledge on the subject.
The main themes were as follows:
(Main Training Themes)
Insider trading prevention, money laundering prevention and compliance with the Foreign Exchange and Foreign Trade Act, anti-social organization checks, the management of information assets, and the prevention of bribery

Whistle-blower Program

Aozora has established a whistle-blower program called the Aozora Hotline Program in order to detect and correct at an early stage any conduct that breaches laws, regulations, and other rules, and to foster a clean, open, and fair corporate culture. As whistle-blowing contacts for officers, employees, and other personnel of Group companies, we have set up an internal contact, and have also arranged for an outside law firm to act as an outside point of contact.
We are working to create an environment that makes it easier to use the whistle-blower program. Among a host of measures, the program allows for anonymous reporting. In addition, all officers and employees are provided with a special postal envelope addressed to the contact point outside Aozora in advance.
In order to protect whistle-blowers, the program tightly controls information and protects privacy, and strictly prohibits any unfavorable treatment of whistleblowers. If any violation of the law, misconduct, or other such activity is confirmed as a result of whistle-blower investigations, Aozora will promptly take corrective and preventive measures. Aozora also established a follow-up framework designed to verify whether corrective measures sufficiently function after a certain period of time has passed, and whether whistleblowers have suffered any unfair treatment.
In FY2025, there were no whistle-blower cases that had a significant impact on the management of Aozora.

Anti-bribery Initiatives

Aozora has established the Basic Policy on Anti-bribery, which prohibits all Aozora’s officers and employees from giving, offering, or promising improper corporate hospitality, gifts, and other benefits to public officials in any country as well as from giving or receiving excessive corporate hospitality, gifts or other benefits beyond socially acceptable limits. In addition, we continue to provide opportunities for all officers and employees to learn more about our anti-bribery policy.

• Aozora Bank Group Basic Policy on Anti-bribery

Tax Compliance

The Aozora Group recognizes that complying with tax laws and properly paying tax liabilities in all countries where it conducts business are part of our social responsibilities as a business entity. As such, we have developed the "Aozora Bank Group Tax Compliance Policy", as a way to raise awareness of tax compliance among the Group's officers and employees.

• Aozora Bank Group Tax Compliance Policy