MFG

Business Context and Reporting Period

This Form 6-K filing by Mizuho Financial Group, Inc. (MHFG) serves as a convocation notice for the 5th Ordinary General Meeting of Shareholders, scheduled for June 26, 2007. The document includes the Business Report and audited consolidated financial statements for the fiscal year ended March 31, 2007. MHFG operates as a global financial group comprising banking, securities, trust, and asset management businesses through 133 consolidated subsidiaries and 19 affiliates.

Key Financial Metrics (Fiscal Year Ended March 31, 2007)

Dividend Proposal: The Board proposes a year-end cash dividend of JPY 7,000 per common share, an increase of JPY 3,000 from the previous fiscal year.

Material Changes vs. Prior Period

• Profitability Decline: While Ordinary Income increased by JPY 542.1 billion to JPY 4,099.6 billion, Ordinary Profits decreased by JPY 172.9 billion to JPY 748.1 billion, and Net Income decreased by JPY 29.0 billion to JPY 620.9 billion compared to the prior fiscal year.
• Primary Drivers of Decline: The reduction in profits was primarily due to an increase in credit-related costs and a significant loss related to stocks (Net Gains/Losses related to Stocks turned from a gain of JPY 231.5 billion in FY2005 to a loss of JPY 109.5 billion in FY2006).
• Capital Management: In July 2006, the Group repaid all public funds extended in 1998 and 1999. In January 2007, JPY 400.0 billion of non-dilutive preferred debt securities were issued to reinforce the capital base.
• Asset Quality: Total disclosed claims under the Financial Reconstruction Law for the three main banks increased to JPY 1,246.7 billion, driven largely by an increase in "Claims with Collection Risk."

Guidance, Outlook, and Strategic Initiatives

• Strategic Plan: The Group continues to execute the "Channel to Discovery" plan, focusing on a Business Portfolio Strategy across three global groups: Global Corporate, Global Retail, and Global Asset & Wealth Management.
• Expansion and M&A:
  • Mizuho Securities Co., Ltd. agreed to merge with Shinko Securities Co., Ltd., subject to approvals, effective January 2008.
  • Mizuho Corporate Bank acquired U.S. Financial Holding Company status in December 2006 to expand investment banking capabilities.
  • Two asset management subsidiaries agreed to merge in July 2007 to form Mizuho Asset Management Co., Ltd.
• Share Repurchase: The Board set a limit to repurchase up to JPY 150 billion of common stock between June 1 and November 30, 2007, to offset potential dilution from the conversion of Class XI Preferred Stock starting July 2008.
• Risk Management: The Group is implementing Basel II regulations and strengthening compliance structures in accordance with the U.S. Sarbanes-Oxley Act.

Investor Verification Checklist

• Stock Valuation Impact: Verify the magnitude of the JPY 335.8 billion loss on stock devaluation and its specific impact on the investment portfolio composition.
• Credit Cost Trends: Monitor the trajectory of "Claims with Collection Risk," which increased significantly to JPY 598.4 billion, to assess future provisioning needs.
• Merger Integration: Track the regulatory approval status and integration timeline for the Mizuho Securities and Shinko Securities merger.
• Capital Adequacy: Confirm the sustainability of the 12.48% Basel II capital ratio amidst the planned share repurchases and ongoing credit cost management.
• Dividend Sustainability: Assess whether the proposed JPY 7,000 dividend per share is sustainable given the decline in Net Income and the capital return strategy.