Higher profitability than peers Record of strong capitalization relative to risk exposure, and strengthening risk management in response to external changes Expanding revenue sources thanks to increased portfolio diversification Susceptibility to market volatility of business portfolios, including real estate and equity investments Increasing foreign currency funding, which we consider more sensitive to market deterioration than local currency funding Potential increases in geographic and organizational complexities alongside business expansion The negative outlook on Orix reflects our view of an over one-in-three chance that its risk-adjusted capital (RAC) ratio will remain consistently below 10% due to slow progress in replacing assets in its portfolio. Large transactions weigh on the company's RAC ratio. In 2023, it acquired DHC Corp., a major Japan-based manufacturer
