Asset Management One Co., Ltd.

Allegations: THE PLAINTIFF IS ONE OF THE INVESTORS OF A JAPANESE INVESTMENT TRUST FUND (THE "FUND") WHICH WAS MANAGED BY SHINKO ASSET MANAGEMENT CO., LTD ("SHINKO", MERGED TO DIAM CO., LTD. AND NAME CHANGED TO ASSET MANAGEMENT ONE CO., LTD. AS OF OCTOBER 1ST, 2016). THE FUND WAS A PRIVATELY PLACED FUND FOR QUALIFIED INSTITUTIONAL INVESTORS. SHINKO SOLD EQUITIES IN THE FUND IN ACCORDANCE WITH REDEMPTION REQUEST FROM THE PLAINTIFF. LATER THE SAME DAY, IT WAS TURNED OUT THAT THE AMOUNT OF REDEMPTION WAS ONE FIGURE GREATER THAN PLAINTIFF' INTENDED AMOUNT. SHINKO BOUGHT BACK THE EQUITIES BUT A LOSS EVENTUATED TO THE FUND DURING SELLING AND BUYING. THE PLAINTIFF ALLEGED THAT SHINKO HAS CAUSED A FINANCIAL LOSS TO THE PLAINTIFF. Status: Final Summary: THE COURT CASE BETWEEN THE PLAINTIFF AND SHINKO ASSET MANAGEMENT CO., LTD. (DEFENDANT, WHICH MERGED INTO AM ONE ON OCTOBER 1, 2016), FILED TO THE TOKYO DISTRICT COURT ON JULY 31, 2013. THE PLAINTIFF IS ONE OF THE INVESTORS OF A JAPANESE INVESTMENT TRUST FUND (THE "FUND") WHICH WAS MANAGED BY SHINKO ASSET MANAGEMENT CO., LTD. (THE FUND WAS A PRIVATELY PLACED FUND FOR QUALIFIED INSTITUTIONAL INVESTORS.) ON SEPTEMBER 30, 2016, THE COURT HANDED DOWN A JUDGMENT THAT THE DEFENDANT SHOULD PAY YEN 40 MILLION TO THE PLAINTIFF. SUCH AMOUNT WAS ONLY PART OF THE AMOUNT CLAIMED BY PLAINTIFF, BECAUSE OF COMPARATIVE FAULT (THE COURT FOUND BOTH PARTY'S NEGLIGENCE.) NEITHER PARTY MADE AN APPEAL AND THE CASE HAVE BEEN CLOSED.

Allegations: THE REGULATORY ACTION IS DIRECTED TO MIZUHO BANK LTD. ("MIZUHO BANK") AND ITS PARENT COMPANY, MIZUHO FINANCIAL GROUP INC. (THE "MHFG"). MIZUHO BANK CAUSED SYSTEM FAILURES EIGHT TIMES IN TOTAL DURING THE PERIOD FROM FEBRUARY TO SEPTEMBER 2021, WHICH SIGNIFICANTLY AFFECTED ITS INDIVIDUAL AND CORPORATE CUSTOMERS. FURTHERMORE, IN THE RESTORATION PROCESS AFTER THE SYSTEM FAILURE ON SEPTEMBER 30, A PROBLEM WAS FOUND IN RELATION TO MIZUHO BANK'S COMPLIANCE WITH LAWS AND REGULATIONS RELATED TO ASSET FREEZING AND OTHER ECONOMIC SANCTIONS AS WELL AS THE AML/CFT GUIDELINES. THE FSA FOUND THAT THE DIRECT CAUSE OF THE SERIES OF MULTIPLE SYSTEM FAILURES AS FOLLOWS: ·MIZUHO BANK HAS FAILED TO CONDUCT VERIFICATION SUFFICIENTLY FOR ENSURING QUALITY IN SYSTEM DEVELOPMENT AND RESPONSES TO FAILURES. ·MIZUHO BANK HAS NOT DEVELOPED A MAINTENANCE AND OPERATION STRUCTURE TO ENSURE STABLE OPERATION OF ITS NEW CORE SYSTEM, SUCH AS FAILING TO CORRECT PROBLEMS IN SYSTEM MAINTENANCE AND OPERATION AND TO GOVERN OUTSOURCEES SUFFICIENTLY. ·MIZUHO BANK HAS FAILED TO VERIFY ITS PREPAREDNESS FOR EMERGENCIES SUFFICIENTLY THROUGH DRILLS AND TRAINING. THE FSA FURTHER FOUND THAT MHFG FAILED TO MANAGE AND CONTROL MIZUHO BANK APPROPRIATELY AS A BANK HOLDING COMPANY AND IDENTIFIED MHFG'S GOVERNANCE RELATED ISSUES. THE FSA CONSIDERS THAT THE ROOT CAUSES OF THESE PROBLEMS IN TERMS OF SYSTEMS AND GOVERNANCE ARE AS FOLLOWS: (1)DISREGARD FOR SYSTEM-RELATED RISKS AND EXPERTISE (2)DISREGARD FOR THE ACTUAL SITUATION OF THE IT SECTION (3)LACK OF SENSITIVITY TO THE IMPACT ON CUSTOMERS AND DISREGARD FOR THE ACTUAL SITUATION OF THE SALES SECTION (4)ATTITUDE TO REFRAIN FROM SAYING WHAT NEEDS TO BE SAID AND TO ONLY DO WHAT WAS INSTRUCTED ACCORDINGLY, THE FSA HAS ORDERED MIZUHO BANK AND MHFG TO FORMULATE BUSINESS IMPROVEMENT PLANS AS FURTHER DESCRIBED IN 12.B BELOW. Status: Final Sanction Detail: SEE ABOVE. Summary: MIZUHO BANK AND MHFG WILL BE TAKING ACTIONS AS DIRECTED IN THE BUSINESS IMPROVEMENT ORDER AND PROVIDE A BUSINESS IMPROVEMENT PLAN, RELEVANT REPORTS, AND STATUS UPDATES TO THE FSA BY THEIR RESPECTIVE DUE DATES AS SET FORTH IN THE BUSINESS IMPROVEMENT ORDER.

Allegations: MIZUHO FINANCIAL GROUP INC. (THE "ADVISORY AFFILIATE")'S BANKING SUBSIDIARY, MIZUHO BANK, LTD. ("MIZUHO BANK") HAD SEVERAL SYSTEM FAILURES IN 2021 WHICH CAUSED SIGNIFICANT INFLUENCES ON ITS CUSTOMERS. IN THE MEANTIME, MIZUHO BANK PLANS TO RENEW AND UPDATE ITS SYSTEMS NECESSARY FOR BUSINESS CONTINUITY (THE "SYSTEM RENEWAL PLAN"). IN CONNECTION WITH THE ABOVE, THE FSA ISSUED A BUSINESS IMPROVEMENT ORDER TO MIZUHO BANK AND THE ADVISORY AFFILIATE THEREBY ORDERING MIZUHO BANK (1) TO REEXAMINE AND REVIEW THE SYSTEM RENEWAL PLAN TAKING INTO ACCOUNT THE PAST SYSTEM FAILURES, THE NECESSITY AND URGENCY OF THE SYSTEM RENEWAL PLAN, AND POSSIBLE RISKS TO THE BANKING BUSINESS, (2) TO ENSURE APPROPRIATE CONTROLS BE PLACED IN CONNECTION WITH THE SYSTEM RENEWAL PLAN AND (3) TO SUBMIT THE RESULTS OF (1) AND (2) ABOVE. THE BUSINESS IMPROVEMENT PLAN ALSO ORDERED THE ADVISORY AFFILIATE, AS A BANK HOLDING COMPANY OF MIZUHO BANK, TO VERIFY THE RESULTS OF MIZUHO BANK'S REEXAMINATION AND REVIEW OF THE SYSTEM RENEWAL PLAN AS WELL AS A PLAN FOR APPROPRIATE CONTROLS, AND TO SUBMIT THE RESULTS OF SUCH VERIFICATION BY OCTOBER 29, 2021. Status: Final Sanction Detail: SAME AS ABOVE. Summary: THE ADVISORY AFFILIATE IS IN THE PROCESS OF REVIEWING AND VERIFYING MIZUHO BANK'S SYSTEM RENEWAL PLAN AND MANAGEMENT CONTROLS, AND PREPARING THE VERIFICATION RESULTS TO BE SUBMITTED TO THE FSA.