Message from the President

I would like to thank all our shareholders and other stakeholders for their support and encouragement.

　The following is a report on the Bank’s business and earnings performance for the six-month first-half period (April 1 to Sept. 30, 2009) of the fiscal 2009 business term.

　Isao Oshiro

　President

Financial & Economic Environment

Despite a worsening employment picture, the Japanese economy showed signs of recovery in the first half of fiscal 2009, supported by the completion of the inventory adjustment cycle, as well as the impact of the government's stimulus package and an increase in exports.

　Even with the stimulus package, the economy of Okinawa Prefecture continued to struggle amid ongoing weakness in tourism due to the economic slowdown, weak spending as consumers avoided non-essential purchases and a decline in construction due to lower investment in the sector.

Business Activities & Performance Results

Against this backdrop, the Bank took measures to develop marketing channels, SME loans and deposit-taking and assets-in-custody operations, to meet the goals of the Challenge 51 medium-term management plan launched in fiscal 2007. At the same time, we remained committed to qualitative and quantitative service improvement, to meet our fiscal year target of bolstering our earnings opportunities and fundamentals so as to complete repayment of public loans.

　To expand marketing channels, we took measures to upgrade our one-stop services, from consultation to contract signature, primarily for mortgage loans, after consolidating mortgage loan centers and “Loan Plaza” corners in four locations throughout the prefecture into integrated “Loan Centers.”

　For SMEs, we launched a loan enabling large trucks and cranes and measuring equipment to be used as non-real estate collateral when real estate collateral is unavailable. With the economic environment remaining harsh, we also supported small businesses fund-raising by continuing to take part in a state program of emergency credit guarantees we joined in the previous fiscal year.

　Turning to deposits and assets-in-custody, in addition to launching four new categories of time deposit, we responded to new customer requirements in our life insurance line by adding level-premium to our single-premium products, as well as life insurance products for corporations.

Issues Facing the Bank

With the Japanese economy now showing signs of an upswing, the economic rot in Okinawa Prefecture has been stopped for the moment by government measures and the rebound in the national economy. However, concerns remain regarding personal incomes and the employment environment nationwide.

　Against this backdrop, the Bank will continue to respond to the needs of its customers and fulfill the role expected of the prefecture’s leading bank. We aim to retain the strong trust and support of the people of Okinawa, and to remain the bank of choice for the community.

November 2009