Risk Management
Basic Policy
Aozora positions risk management as the foundation supporting our value creation process. We are working to enhance our risk management through the establishment of a system to appropriately ascertain and control risks individually and in the aggregate, and through appropriate and disciplined management based on regulations stipulated for each risk category.
Through efficient management and utilization of managerial resources and sound risk-taking, we will realize Aozora’s management philosophy to “contribute to the development of society through the creation of new value-added services” with a basic policy of sustainable and stable accumulation of earnings, capital adequacy, and corporate growth.
Management Structure
Aozora’s risk management structure is organized into two major groups. The first is the Board of Directors and the Risk Governance Committee, comprised largely of outside directors. The second is the Management Committee and sub-committees to which it delegates authority. The Management Committee and sub-committees analyze and take into consideration a range of risks arising from the origination of loans and investments, the delivery of services to customers, and business operations from a broad perspective. In addition, each risk management division monitors and reports on the status of Aozora’s risk to the Management Committee and sub-committees both on a regular and as-needed basis to ensure the flexible and proper management of risk. The status of risks is also reported to the Board of Directors and the Risk Governance Committee on a regular and as-needed basis, and the appropriateness and effectiveness of risk management are discussed to ensure the effectiveness of risk governance.
Risk Management Structure
- The Audit and Compliance Committee was reorganized into the Risk Governance Committee on July 1, 2025.
- The Customer Protection Committee was reorganized into the Customer Committee on July 1, 2025.
Key Risks
We discuss our risk appetite and business planning based on the following key risks, and also strive for a higher level of risk management.
- Increase in credit costs
- Deterioration in unrealized gains/losses on securities portfolio
- Instability of funding
- Outbreak of crises such as cyberattacks and system failures
- Outbreak of large-scale disasters and other crises
- Reduced competitiveness due to changes in the social structure or industrial structure
- Inadequate response to financial crimes, occurrence of internal fraud and information leaks
- Sustainability of human resources
Please refer to page 16 of the Annual Report 2025 (Financial and Corporate Data Section) for details of key risks.