Corporate Governance

Basic Approach to Corporate Governance

At Rakuten Bank, we are aware that maximizing corporate value while also meeting our public responsibilities as a bank is fundamental to the concept of corporate governance. Therefore, we have established a corporate management framework that strengthens corporate governance while maintaining efficient and fair decision-making and business management systems utilizing transparent and sound management policy decision-making processes, strengthened mutual supervision provisions, a clearly defined compliance framework and clear disclosure mechanisms.

Corporate Governance Structure

To ensure transparent and sound management policy decision-making processes and establish appropriate, efficient, and fair decision-making and business operation processes, the Company has adopted the structure of a company with an Audit and Supervisory Board based on the determination that auditing the Board of Directors from an independent standpoint by the Audit and Supervisory Board Members and the Audit and Supervisory Board is effective in ensuring the appropriateness of business execution. The Board of Directors consists of seven members, including four Outside Directors who have extensive business experience and are capable of evaluating and auditing the business results from an objective point of view. The independent Audit and Supervisory Board Members consists of four Outside Audit and Supervisory Board Members, comprising highly experienced specialists possessing extensive knowledge from the finance industry to effectively monitor and audit management.

Structure Chart

Meeting Body	Role
Board of Directors	Monitors Bank management, resolves statutory matters, determines basic policies, exchanges opinions from broad perspectives, and establishes a management control framework in an effort to enhance the fairness and transparency of business execution.
Audit and Supervisory Board	Receives reports on, discusses, and resolves important matters related to audits. Also meets regularly with the President & CEO to exchange opinions on issues to be addressed by the Bank, risks surrounding the Bank, the state of the audit environment for Audit and Supervisory Board Members, and important audit issues, in an effort to deepen mutual recognition and trust with the President & CEO.
Management Conference	Serves as a deliberative body for matters to be resolved by the Board of Directors, a business execution body based on business operation policies decided by the Board of Directors, and a prior consultation body for matters authorized by the President under the authority of the Board of Directors to facilitate decision-making and provide information necessary for management monitoring with regard to proposals submitted to the Board of Directors.
Special Advisory Committee	Comprising Independent Directors/Auditors (Outside Directors and Outside Audit and Supervisory Board Members having no conflicts of interest with general shareholders), determines management policies based on requests from the Rakuten Group pertaining to Group business strategy, and in the event of interrelated personnel matters between the Bank group and Rakuten Group, or any transactions with the Rakuten Group, examines the appropriateness of the arm’s length rule, conflict-of-interest and other transactions from the perspective of ensuring sound and appropriate management of bank business, as well as the necessity and appropriateness of such rules from the perspective of protecting minority shareholders.

Board of Directors Efficacy Assessment

To further improve the Board of Directors’ efficacy with the aim of ascertaining matters that require consideration going forward, the Company conducted a survey on the Board of Directors’ operation targeting all directors and Audit and Supervisory Board Members in April 2026 to assess the overall efficacy of the Board of Directors, and the results of this survey were reported to the Board of Directors in May 2026.

＜Evaluation Method＞

Evaluators: Director, Auditors (total of 9 individuals)
Methodology: Questionnaire. The questionnaire included both questions and spaces for free-for text responses. Following the survey, strategies for improving effectiveness are reported to the Board of Directors.
Overview: Matters related to decisions on important business execution, and deliberations by the Board of Directors, etc.

＜Evaluation Results＞

The Company has confirmed that the effectiveness of the Board of Directors is generally ensured. In addition, the following intentions were also confirmed for further improvement of effectiveness:

• - To strive for more in-depth discussions on important themes such as growth strategies based on the economic and competitive environment, human capital strategies, and AI utilization policies.
• - Regarding the submission standards for the Board of Directors, the content and volume of agenda items and reporting items are appropriate, and we will continue to work on efficient operation aimed at in-depth discussions.

＜Efforts to Improve Effectiveness＞

Based on the results of the effectiveness evaluation for the previous fiscal year, we implemented the following measures to further enhance Board deliberations and improve the effectiveness of the Board of Directors:

• - Established time for free discussions in addition to deliberations on Board resolutions and reports, to facilitate more in-depth discussions on important themes such as management issues and growth strategies.
• - Introduced written reports for routine agenda items and optimized meeting durations based on the nature of each proposal, thereby ensuring sufficient time for in-depth deliberations.

Policy for Determining Director Compensation

1. Basic Policy

With an awareness of our social responsibility and public role as a bank, the executive compensation system is designed in line with our management philosophy of working to win the unshakable trust of society and firmly　establish our value through our commitment to sound and efficient business operations based on a high level of self-discipline.
Compensation levels are determined on the basis of economic and social conditions, industry trends, and the Bank’s business environment and performance, among other factors, to ensure appropriateness as an incentive for directors to maximize their roles, as well as compensation commensurate with responsibilities and achievements.

2. Compensation Structure

Executive director compensation consists of fixed compensation (basic compensation) and variable compensation (performance-linked compensation and non-monetary compensation (Stock Options)). To achieve sustainable growth through the achievement of management targets and enhance corporate value over the medium to long term, the Company has adopted a compensation system in which variable compensation (performance-linked compensation and non-monetary compensation (Stock Options)) accounts for a higher proportion of overall compensation.
Non-executive directors receive fixed compensation in light of their role in supervising the Company's management from an objective and independent standpoint. The policies for determining each type of compensation are as follows.

3. Compensation Determination Process

The specific amount of compensation for each director is determined by a resolution of the Board of Directors and authorized by the President & CEO. All Outside Directors review and determine the proposed compensation for each director within the maximum scope of compensation approved by the Shareholders Meeting and in accordance with the intent of the policy for determining director compensation. The President & CEO determines compensation for each director, respecting to the maximum extent possible the compensation proposals for each director reviewed and determined by all Outside Directors.

Appointment of Directors and Audit and Supervisory Board Members

In recommending director candidates, the Board of Directors, in accordance with the intent of the Banking Act, selects individuals who are highly insightful and socially credible. It is the Board's policy to nominate a majority of Outside Directors. In selecting candidates for Audit and Supervisory Board Members, the Audit and Supervisory Board carefully considers candidate qualifications as Audit and Supervisory Board Members, taking into consideration factors including the candidate’s ability to serve out their full term of office, ensure independence from business executors, and maintain a fair and unbiased perspective. Further, when nominating a candidate from the Rakuten Group, the Special Advisory Committee is consulted in advance to determine whether there are any obstacles to the sound and appropriate management of Bank business, as well as to protect minority shareholders, as interrelated personnel matters between the Bank group and the Rakuten Group.

Reasons for Appointment of Outside Directors

Name	Independent Director*	Reasons for appointment
Masatsugu Nagato	○	Held important positions such as Director and President and Representative Executive Officer of Japan Post Bank Co., Ltd. and Japan Post Holdings Co., Ltd. Appointed as an Outside Director to incorporate this experience and insight and further enhance the Company’s corporate governance.
Kayoko Kawamura	○	Served as systems engineer for financial institutions and head of application development at IBM Japan, Ltd. and is currently mainly responsible for supporting digital transformation (DX) at client companies. Possesses a wealth of knowledge and experience relating to DX. She also has experience in managing corporate organizations as a non-executive director. Appointed as an Outside Director, expected to provide advice and make other contributions from an objective viewpoint based on this knowledge and experience, and to utilize these qualities to reinforce the Company’s strengths as a digital bank and further enhance the Company’s corporate governance.
Satoshi Kawai	○	Possesses professional knowledge and experience as an attorney-at-law and a wealth of experience and insight nurtured during his tenure as Special Member of the Dispute Reconciliation Committee for Nuclear Damage, Ministry of Education, Culture, Sports, Science & Technology, and Member of Subcommittee for Reform of Incorporated Administrative Agencies, Counsel for Promotion of Administrative Reform, Headquarters for Promoting Administrative Reform of the Cabinet Secretariat, among other positions. Appointed as an Outside Director, expected to provide advice and make other contributions from an objective viewpoint based on his knowledge and experience, and to utilize the experience and insight to further enhance the Company’s corporate governance.
Mari Kogiso	○	Possesses diverse experience as an entrepreneur and senior manager, in addition to experience at financial institutions. Also brings a wealth of experience serving in key positions in global organizations, as well as extensive experience as an outside director or auditor at various companies. Appointed as an Outside Director, expected to provide advice and make other contributions from the diverse viewpoints cultivated through this experience, and to utilize this experience and insight to further enhance the Company’s corporate governance in pursuit of sustainable growth.

Reasons for Appointment of Outside Audit and Supervisory Board Members

Name	Independent Audit and Supervisory Board Member*	Reasons for appointment
Jun Ikeda	○	Held key positions in financial administration, fiscal policy, and organizational management at the Ministry of Finance, the Financial Services Agency, the Deposit Insurance Corporation, and other bodies, and possesses exceptional insight. In addition, he has practical experience in finance and investment management, as well as serving as a full-time auditor at private-sector companies, and possesses deep insight into concrete and effective auditing methods grounded in the realities of corporate operations. Appointed as an Outside Audit and Supervisory Board Member to utilize his outstanding expertise in the financial sector and his management oversight capabilities, backed by practical experience, within the Company’s audit framework, to contribute to the Company’s sustainable growth and the enhancement of corporate value.
Shinnosuke Yamada	○	Possesses professional expertise as a certified public accountant and a wealth of experience and insight gained through his previous roles, including Chairman of the employee meeting of KPMG AZSA LLC, Director (Audit Committee Member) of T&D Holdings, Inc., and outside corporate auditor of EXIO Group, Inc. Appointed as an Outside Audit and Supervisory Board Member to utilize this experience and insight cultivated to supervise the Company’s management, further enhancing the Company’s governance framework.
Toru Mimura	○	Possesses a wealth of experience and insight in finance, global risk management, corporate legal affairs, etc. gained through many years of holding important positions across a wide range of fields in ministries and agencies, as well as serving as the chairman of a research institute. We appointed him as an Outside Audit and Supervisory Board Member to incorporate this experience and insight and further enhance our corporate governance.
Kiyoko Ohora	○	Served as an Executive Officer at S&P Global Ratings Japan Inc., supporting management decision-making while leading efforts to coordinate with regulatory authorities and establish and operate internal controls in collaboration with the compliance department. Furthermore, with many years of experience in credit rating analysis for financial institutions, she possesses advanced analytical skills in the assessment of both financial and non-financial risks, as well as deep insight into the importance of corporate governance in business management. Appointed as an Outside Audit and Supervisory Board Member to utilize this experience and expertise to strengthen the Company’s audit framework.

Skills Matrix of Directors and Audit and Supervisory Board Members

Board of Directors and Audit and Supervisory Board Meetings and Attendance by Outside Directors and Outside Audit and Supervisory Board Members

Policy on Director and Audit and Supervisory Board Member Training

Rakuten Bank provides opportunities for directors and Audit and Supervisory Board Members to acquire knowledge and information necessary for executing their duties, enabling them to properly fulfill their roles. Specifically, newly appointed executives have always received operational explanations from divisional general managers pertaining to the division under their jurisdiction, while the President & CEO, Outside Directors, and Outside Audit and Supervisory Board Members are, in principle, provided with opportunities to Auditors exchange opinions individually after regular Board of Directors meetings to continuously support the acquisition of information and knowledge necessary to fulfill executive roles upon appointment. The Bank also bears the cost of outside seminars and other self-study required to fulfill expected roles.

Guidelines Concerning Measures to Protect Minority Shareholders in Transactions with Controlling Shareholders

Rakuten Bank has entered into a Basic Management Agreement with Rakuten Group, Inc., its parent company, which is intended to define the basic relationship between the two companies. The Agreement stipulates that the Bank will respect the management independence required of it as a bank in the public interest and the independence required of it as a listed subsidiary. It further stipulates that Rakuten Group, Inc. respects that the Bank will proactively appoint directors from outside the Rakuten Group, respect that the Bank will establish a system of appropriate governance checks, and respect the Bank’s personnel rights over its employees. The Agreement does not provide for prior approval or prior consultation with Rakuten Group, Inc. Reports from the Bank to its parent company are provided to the extent necessary and legal in accordance with the Agreement. Additionally, the Agreement stipulates that Rakuten Group, Inc. will take necessary measures to ensure the sound and proper management of the Bank business in the event of a deterioration in Bank business conditions, and that Rakuten Group, Inc. will not request capital contributions, loans or other support from the Bank in the event of a deterioration in Rakuten Group, Inc. business conditions.
Further, when conducting transactions or other businesses with the Rakuten Group, Inc., as mentioned above, the Special Advisory Committee examines the appropriateness of the arm’s length rule, conflict-of-interest and other transactions from the perspective of ensuring sound and appropriate management of Bank business, as well as the necessity and appropriateness of such rules from the perspective of protecting minority shareholders.

Cooperation among Audit and Supervisory Board Members, Accounting Auditors, and the Internal Audit Department

The head of the Internal Audit Department participates in monthly Audit and Supervisory Board meetings, during which internal audits are reported and opinions are exchanged as needed. Audit and Supervisory Board Members, the head of the Internal Audit Department, and Department staff also exchange opinions on audits by Audit and Supervisory Board Members and internal audits on a daily basis. Audit and Supervisory Board Members and the Internal Audit Department exchange audit plans and explain and report on them, sharing information on the audit environment and other issues specific to the Bank. The Bank’s accounting audits are conducted by ERNST & YOUNG SHINNIHON LLC. The Bank exchanges opinions, shares information, and provides the results of internal audits and audits by Audit and Supervisory Board Members with the accounting auditors as necessary. Audit and Supervisory Board Members and accounting auditors exchange audit plans, explain and provide reports as necessary, and share information on the audit environment and other issues specific to the Bank. In addition, three-way audit meetings are held comprising Audit and Supervisory Board Members, accounting auditors, and the Internal Audit Department, where opinions are exchanged among the three parties.

Dialogue with Shareholders

We discloses timely and appropriate information to shareholders and investors in accordance with the Banking Act, the Financial Instruments and Exchange Act, and the timely disclosure rules set by the Tokyo Stock Exchange.
We also aims to enhance corporate value by disclosing information fairly to all stakeholders, including customers, business partners, and employees. The following measures are implemented to achieve this:

• 1.　The officer in charge of the Planning Department oversees general dialogue with shareholders, supported by the IR team and other departments such as planning, finance, legal, general affairs, and human resources, ensuring close coordination and information sharing.
• 2.　In addition to individual meetings with shareholders, the Company provides opportunities to explain business performance and strategies through the General Shareholders’ Meeting, financial results briefings, small meetings for analysts, and individual meetings with institutional investors. The Company also strives to provide fair and prompt information through live and on-demand streaming of financial results briefings. Furthermore, the Company enhances information provision by disclosing financial results summaries, financial results reference materials, timely disclosure materials, and press releases on its website, as well as IR-related materials such as the Notice of General Shareholders’ Meeting and Integrated Report.
• 3.　Opinions and feedback from shareholders obtained through dialogue are shared with the President, relevant directors, departments, and the Board of Directors as necessary to ensure information sharing and utilization.
• 4.　The Rakuten Group Code of Ethics stipulates the proper use and management of information related to the Group, including the Company, and its customers. The Company strictly manages material facts and related parties to prevent insider trading and conducts awareness-building activities for employees. To ensure fairness and prevent the leakage of financial results information, the Company sets a “quiet period” of four weeks before the announcement of quarterly results for both the Company and its parent company, during which no external comments or responses to inquiries about financial results are made. However, this does not apply to inquiries about already disclosed facts or the occurrence of material facts requiring timely or statutory disclosure during this period.

Status of Dialogue with Shareholders

We disclose information regarding the status of dialogues between the management and shareholders.

• Status of Dialogue with Shareholders