SMFG Capital Ratio Information ■  Equity Exposures in Banking Book 1. Risk Management Policy and Procedures Securities in the banking book are properly managed, for example, by setting upper limits on the allowable amount of risk under the market  or credit risk management framework selected according to their holding purpose and risk characteristics.  For securities held as “available-for-sale securities,” the upper limits are also set in terms of price fluctuation risk. Regarding stocks of subsidiaries, assets and liabilities of subsidiaries are managed on a consolidated basis, and risks related to stocks of  affiliates are recognized separately. Their risk as equity is not measured as upper limits on the allowable amount of risk are set for stocks  of subsidiaries and affiliates, and the limits are established within the “risk capital limit” of SMFG, taking into account the financial and  business situations of the subsidiaries and affiliates. Stocks of subsidiaries and affiliates are carried at amortized cost using the moving-average method. Available-for-sale securities with market  prices (including foreign stocks) are carried at their average market prices during the final month of the fiscal year. Securities other than  these securities are carried at their fiscal year-end market prices (cost of securities sold is calculated using primarily the moving-average  method) and those with no available market prices are carried at cost using the moving-average method. Net unrealized gains (losses) on available-for-sale securities and net of income taxes are reported as a component of “net assets.” Derivative  transactions are carried at fair value. 2. Valuation of Securities in Banking Book and Other Significant Accounting Policies 3. Consolidated Balance Sheet Amounts and Fair Values  4. Gains (Losses) on Sale and Devaluation of Stocks of Subsidiaries and Affiliates and Equity Exposures 5. Unrealized Gains (Losses) Recognized on Consolidated Balance Sheets but Not on Consolidated Statements of Income 6. Unrealized Gains (Losses) Not Recognized on Consolidated Balance Sheets or Consolidated Statements of Income Billions of yen 2011 2010 March 31 Balance sheet amount  Fair value Balance sheet amount  Fair value Listed equity exposures ........................................................... ¥2,470.7 ¥2,470.7 ¥2,570.5 ¥2,570.5 Stocks of subsidiaries and affiliates  and equity exposures other than above ................................. 609.1 — 629.8 — Total .......................................................................................... ¥3,079.7 ¥ — ¥3,200.3 ¥ — Billions of yen Fiscal 2010 Fiscal 2009 Gains (losses) ......................................................................................................................................... ¥ (91.9) ¥(10.1) Gains on sale .................................................................................................................................. 27.5 57.2 Losses on sale ................................................................................................................................ 4.6 34.8 Devaluation ..................................................................................................................................... 114.9 32.5 Note: The above amounts are gains (losses) on stocks and available-for-sale securities in the consolidated statements of income. Note: The above amount is for stocks of affiliates with market prices. Billions of yen March 31 2011 2010 Unrealized gains (losses) recognized on consolidated balance sheets  but not on consolidated statements of income.................................................................................... ¥383.8 ¥483.6 Note: The above amount is for stocks of Japanese companies and foreign stocks with market prices. Billions of yen March 31 2011 2010 Unrealized gains (losses) not recognized on consolidated balance sheets or consolidated statements of income .................................................. ¥(52.7) ¥(39.7) SMFG  2011 196