Our Business Operations

Aozora’s Platform Business is a distinctive business of the Aozora Group. Through collaboration with Aozora’s business groups and external business partners, this business effectively provides Aozora’s advanced services and expertise to retail and regional financial institution customers to meet their specific characteristics and needs.

This business provides Aozora’s broad financial and non-financial services to retail customers and SME owners. A diverse array of services will also be provided to regional financial institutions and their clients.

Corporate Business Group (CBG)

CBG aims to solve customers’ issues and address social issues. We provide a broad range of structured finance, in which we have a strong track record. We also offer sustainable finance, support for DX, and market risk hedging products. Furthermore, CBG is accelerating the promotion of equity investments with a primary focus on engagement (dialogue-driven investments), structured equity investments, and an ecosystem for start-ups support focusing on venture debt. In the process, we will develop a deep understanding of our customers’ businesses and provide value-added advice to resolve the challenges customers and society face based on in-depth dialogue. The advice we offer will make full use of Aozora’s managerial resources.

M&A Advisory Group (MAG)

There are many SMEs in Japan and the number of aging business owners of SMEs has been increasing and their average age has now surpassed 60.

The limited availability of successors has been addressed in the past few years, owing to the widespread adoption of M&As and progress in areas such as the business succession taxation system and business succession funds. However, rapid changes in the recent business environment have resulted in an increase in the closure of some businesses. There is a growing need to pass the SMEs' valuable technologies and skilled human resources to the future generation.

Through our M&A advisory services and business succession funds, we will support both domestic and overseas customers to solve issues such as enhancement of their corporate value, structural transformation in their businesses, and business succession, with a view to contributing to the development of society.

Acquisition & Structured Finance Group (ASG)

We have been active as an arranger in LBO financing since the inception of LBOs in Japan. Aozora’s buyout business, including LBO loans, has grown along with the development of the market. Through collaboration with many private equity (PE) funds, we have provided risk financing by extending LBO loans and making limited partnership (LP) investments in PE funds. These loans and investments have been provided in response to changes in industrial structure and business succession.
Recently, we have been serving as an arranger for some of the most prominent large-scale projects in Japan, including carve-outs by major companies, which involve sale of business units or subsidiaries, and going-private transactions aimed at restoring growth and structural transformation. We have also been engaging in numerous small and medium-sized transactions such as business owner succession.
We will contribute to the market’s sound development mainly by providing high-quality investment and lending, industry information, and sound advice on LBO finance to investors, and also accepting trainees from them.

Environment Business Group (EBG)

In January 2022, we established a specialized group for environmental financing in order to facilitate the transition to clean energy and next-generation energy through finance. This group was formed by merging extensive financing experience centered on renewable energy in Japan and advanced knowledge gained from finance in Europe and the U.S., which are leading environmental regions and countries.
Since 2022, we have held the top-level origination position in Japan, arranging domestic project financings totaling over 130 billion yen. Furthermore, we have contributed to the widespread adoption of clean energy and regional economic development by offering syndicated loans worth a total of 90 billion yen to regional financial institutions via our financial institutions platform. Overseas, we conduct business from a global perspective leveraging our overseas office network.
In addition, our efforts have led to an arrangement of financing for a geothermal power plant project in collaboration with local financial institutions by combining our knowledge from Japan and overseas.

Special Situations Group (SSG)

SSG is the only finance team among Japanese banking groups that provides all three functions of loan purchasing, provision of new credit, and reconstruction support.
We contribute to the revitalization of regional economies and industries through our recovery business. Our recovery business is offered through Aozora Loan Services Co., Ltd. (loan purchasing), a leading company in the servicing industry; the Special Situations Division (provision of new credit), which provides services such as DIP finance; and Fukushima Recovery Co., Ltd. (reconstruction support), which provides reconstruction support to SMEs in Fukushima Prefecture.

Real Estate Finance Group (RFG)

RFG is responsible for real estate investment and lending in Japan and overseas. As Japan’s real estate securitization market has developed, we have expanded our business areas beyond loans to real estate companies to include real estate non-recourse loans and real estate equity investments. We have also extended our business coverage areas to North America and Europe.
We work to help our customers solve their issues through our ability to provide highly specialized real estate finance based on the experience, track record, and expertise we have accumulated in real estate finance over many years. We also strive to solve the social challenges that lie beyond the issues faced by our customers.

International Business Group (IBG)

IBG is focused on generating stable revenue as one of Aozora’s revenue contributors. IBG is active mainly in the U.S. and European corporate loan markets through our overseas subsidiaries in New York and London. We strive to maintain and improve the quality of our loan portfolio by leveraging our seamless monitoring framework centered on our three offices in New York, London, and Tokyo.
We also intend to steadily capture growth in Asia through cooperation with leading local partners and fund investments. In that context, we are selectively making equity-related investments that can possess potential upside opportunities.

Allied Banking Group (ABG)

ABG serves as a business platform in the Aozora Group with responsibility for financial institutions, regional corporations and public institutions nationwide. Financial institutions and regional corporations face numerous challenges, including the end of negative interest rates, accelerated initiatives to support the recovery and business succession of regional corporations in the post-COVID-19 era, and the use of new technologies such as generative AI. We have a strong network of regional financial institution customers across Japan, which has been developed through our doing business with them for over 60 years. Based on this strong network, we will identify customers’ evolving issues and offer our Fostering, Change, and Recovery solutions, thereby contributing to the enhancement of the value of customers and regions.

Retail Banking Group (RBG)

RBG provides unique and highly specialized services primarily through BANK™, a financial service that allows customers to engage in transactions via a smartphone app, as well as through our Call Center branches, and external shared office spaces.

The BANK™ app is used by customers across a wide range of age groups for transactions. We have enhanced the services available through BANK™, such as providing deposits with attractive interest rates, investment trusts, debit cards, and “BANK The Story,” a support service that guides customers on how to wisely spend money to enrich one’s life. Additionally, “BANK The Partner” has been launched as a service that helps customers achieve their life planning goals.

We are also implementing “customer-oriented business management” in our consulting services. We provide asset management, wealth transfer, and business succession-related services as an entire Group, with a view to solving the challenges faced by each customer.

Financial Markets Group (FMG)

FMG will address on an ongoing basis the major changes occurring in the financial environment both in Japan and overseas. The business is now expected to be managed in a rising yen-interest rate environment following the end of the Bank of Japan’s negative interest rate policy. In derivatives sales and trading, we will provide optimal solutions to meet the diverse needs of our retail, corporate, and financial institution customers through our broad product lineup. Furthermore, in ALM and securities investment, we will generate consistent returns by developing strategies for yen and foreign currency funding while balancing the need for stability, as well as conducting flexible portfolio management based on strong risk controls.

• For details on the business activities of each group, please refer to pages 52-68 of the Annual Report 2024.