Hello, everyone. I am Minami from Resona Holdings. Thank you for joining our IR presentation today. Although COVID-19 situation has been settling a little these days, we continue to forecast and prepare for the future, including the sixth wave, without letting our guard down, which is critical in crisis management. We also continue to work side by side with our customers under any circumstances and fulfill social responsibilities through community-based seamless financial services. I would like to start the presentation and have the analyst call after the disclosure. Today's focus will be mainly strategies. Please go to page four. This is outline of financial result for first half of the fiscal year 2021. Net income is JPY 80.8 billion, JPY 24.4 billion increase year-on-year, + 43.3%, 55.7% progress against full year target of JPY 145 billion.
Core income, which is net interest income from loans and deposit, plus fee income, plus operating expenses increased by JPY 12.2 billion year-on-year. Core income turned to positive as full year ending March 2021, and positive momentum is maintained in the interim period. Profit is also up by JPY 6.4 billion compared to the pre-COVID-19 term ending 2019 September. In particular, fee income is JPY 105.5 billion, up by JPY 12 billion year-on-year, which is record high level as a half year result since inception of Resona. We believe there are four changes as background for the fee income expansion. One is the Fund Wrap debit card and group applications are historically high and expected to grow further as a result of seeding and developing them. Second is synergy with Kansai Mirai Financial Group with more future potential. Third is DX driven financial platform concept has been taking shape.
Fund Wrap and the applications that are already extended outside the group using platform show the progress in the previous term. Fourth, consulting business, mainly face to face to address changing pain points of customers, is gaining traction. I will explain item by item. Net interest income from domestic loans and deposit is JPY +400 million. Average loan balance is + 2.32%, excluding governments and others, and loan rate is down by 2 basis points. Fee income is JPY 12 billion up year-on-year + 12.8%. Expenses are flat year-on-year and progressing in line within the plan, especially Kansai Mirai Financial Group cost reduction contributed significantly. Kansai Mirai Financial Group consolidated OHR is 71.0%, 8.8% down year-on-year. Net gain on stocks is JPY 24.4 billion, JPY 21.5 billion up year-on-year.
Sales of cross holding shares contributed, and this will be explained on the other slide. I will explain more details about the credit cost, average balance rate, and spread of deposit. I will talk about the loan rates using the graph on the right. While overall range of decline shrinks, corporate banking business unit, light blue line, has turned to positive since Q4 last year and the one basis point improvement as of latest result. This is partially because relatively high loan rate loans such as LBO are increasing and upward revision of data rate by one basis point is made for full year guidance of the corporate loans. Please go to page 13. Credit cost holdings consolidated. Credit cost is JPY -17 billion, so this is the JPY 6.1 billion down year-on-year, and this is 38.6% against full year guidance of JPY 44 billion.
However, post state of emergency recovery of economic activities is expected to contribute to the corporate performance improvement. Yet there are still a lot of uncertainties, and we see a lot of customers are forced to lessen their capital and strengths due to COVID-19 impact. Therefore, full year guidance is unchanged. On the right hand side, cross-holding reduction, JPY 14.3 billion for listed shares and book value basis, and net gain on sales is JPY 20 billion on consolidated basis. Pace of reduction is accelerating from the first quarter to second quarter. We are currently planning to reduce JPY 30 billion in three years from last fiscal year to March 2023, with the 86% progress against plan. So it may be possible to achieve this earlier. We will maintain this going forward as a policy and continue to dialogue with customers. Please go to page 16.
Original guidance, JPY 145 billion of consolidated net income as full-year target and JPY 21 per year as annual DPS is unchanged. At the bottom, although the target of the group banks described, and those have been partially revised considering the first half progress, there is no major change overall.
Top line of group banks is lowered by JPY 5 billion from original guidance reflecting negative impact, JPY 10.4 billion associated with improvement of securities in Q1, and JPY 1.5 billion cost improvement against the guidance is reflected as per KMFG cost improvement. JPY 7 billion upward revision is made for our net gains on stocks based on progress of cross-holding shares reduction and others, and bottom is JPY +1 billion against original guidance. Please go to page 19. This shows the KPI for midterm management plan. Half-year net income of the JPY 80.8 billion includes the great contribution from KMFG's progress.
Interim net income of KMFG doubled from last year's JPY 5.3 billion to JPY 10.6 billion. Contribution margin to holding's consolidated basis quadrupled from last year's JPY 2.7 billion to JPY 10.6 billion, JPY 7.9 billion up. We think that the transition from the structure development stage to growth stage to drive outcome is working. Based on this, we believe making them 100% subsidiary in this April was a good timing. Consolidated fee income ratio increased to 32.6%. As top line increased, ROE increased to 8.23%, exceeding this year's target of mid 7%. On capital side, Common Equity Tier 1 capital ratio based on finalized Basel III, excluding net unrealized gains on available for sale security, is around 9.3% at the end of September, with 10% target. We also aim to be included in all four indices selected by GPIF, and currently included in all of those four indices.
I will talk about the growth strategies. We have been talking about the SDGs- oriented management of Resona, which is the business starting from the issues customers and society face. Resona jointly grow with society and customers by quickly adapting to changes with our strengths as customers' pain points change day by day. That's how we can become retail number one. There are three main points for us to sustainably grow including mid to long term perspectives. First transformations through two X, first SX sustainability transformation. We aim to become a company that is the most significant contributor to retail customer success. This is the golden opportunity for us. Another X is DX. With DX as a driver, we first transform customer experiences and offer new values to customers.
At the same time, shift profit structure to cover total cost with fee income in the long term through cost structure reform. Second is solid evolution of KMFG, new growth driver in our group. Third is addressing need surfacing under COVID-19 pandemic. We would like to maximize our strength as a retail commercial bank with trust banking capabilities focusing on the deep diving areas described in the midterm management plan. I will explain one by one, but before that, I will talk about the basis for SDGs-o riented management. JPY 1.960 trillion of the public fund was injected in Resona in 2003, and we have implemented the Resona Reform to aspire to be true retail bank. This reform started under the leadership of the former Chairman, Mr. Hosoya, who became our Chairman from the Vice President of JR East.
These phrases are in our group code of conduct by former Chairman Mr. Hosoya. For the Resona Group to grow sustainably, it must aim to be a good company consisting of employees with good personalities, which is the foundation of the Resona SDG-oriented management. Now I will talk about each strategy, starting from the SX sustainability transformation. This shows Resona Group's SX overview. Please take a look later. I will briefly share our ideas about the SX. Some people may be a little hesitant to SX, but I tell all employees that I will seriously commit to this 120%. Sustainability can be addressed in a very long period of time. It may change rules of the game per se, and it may result in structural changes.
The tricky part here is that we don't know when and what kind of innovation will come, and what impact will be brought in what ways at this point. Based on the assumption that structural changes will happen, it will be too late if we take actions once markets start to change. Delayed action can be fatal. Resona Group have business relationship with a wide range of retail customers, and SX is customer's challenge so that we are accelerating response with full participation, aiming to become the financial company that contributes most to customer's SX. As a part of the SX initiatives, long-term sustainability targets were set in June this year. The following is the three specific target by FY 2030. First is retail transition finance, second is carbon neutrality, third is empowerment and promotion of women. I will talk about each of them. Retail transition finance.
We aim at the cumulative amount of JPY 10 trillion by FY 2030. SX initiatives are mainly driven by the large corporations, but we would like to support retail customers by working side by side with them and improving their organizational capabilities based on where they are. The number of SME is 99% in the entire Japan, and 70% in terms of the number of employees, and they generate 53% of the value add. However, the progress of the SX varies by company. We will make sure to have dialogues with customers and propose the first steps based on their own stage with the specific solution. That is our mission. For example, starting from October, we started to have interviews across the entire banks and groups focusing on the ESG topics.
We do have some products and solutions described on the right-hand side, and we are also launching the product to support the customers in October and November. The second is the carbon neutrality. This is a target to achieve net zero CO2 emission from Resona Group's energy consumption by FY 2030. As a member of a community, we hope to achieve this early and contribute to local society's carbon neutrality through the use of renewable energy. These are the target in Scope 1 and Scope 2, but of course, we are thinking about setting the target for Scope 3 as well. Net zero will be the target. As a future direction, we should demonstrate the reduction plan and track record, not just declaring to do that. First thing is to start measuring the greenhouse gas emission from our investment and loan portfolio.
For us, the core of the portfolio is SMEs. This is an important starting point, and Resona volunteered to participate in the Ministry of the Environment Portfolio Carbon Analysis Support Business and selected. We would like to focus on the discussion of Scope 3 measurement method and specifics. The third goal is the empowerment of women and promotion of their activities. On the left is a list of past initiatives, and on the right shows the current status and targets for FY 2030. Empowerment of women is already one of our strengths, with the ratio of female line managers reaching roughly 30%. I am convinced that diversity will lead to even greater flexibility and resilience for Resona.
I would like to refine our value creation by women to the next level by further promoting the appointment and activities of women, not only at the line manager's level, but also at the senior management and executive levels. Let's go over our DX strategies, starting with the overall picture. As I have stated many times, our goals with DX shown at top left are to transform the customer experience, deliver new value to customers, and shift our current cost structure. As you can see in the upper right-hand corner, we are the only company in the banking industry to be selected as a DX Stock for two consecutive years.
We understand that our efforts to provide new value through the fusion of the physical and the digital initiatives have been highly recognized, and we will continue to accelerate our efforts in this area. Now moving on to the digital channels. As you can see at top left, the group app has already become the most accessed channel, and the usage continues to increase. This is already happening in reality. As of September, there were 4.31 million downloads for the whole group. In addition to the app rollout outside of the group, we are now able to have two-way communication with customers that we could not reach before in terms of age groups. The upper right shows the income per person per day, which was JPY 3.6 in the first half of this fiscal year compared to JPY 3.5, which had been the previous level for some time.
As a population of app downloads continues to grow, we are encouraged to see the rise in income per customer. We also believe that one of the reasons for the increase in income per head is that we are gradually expanding our product lineup while maintaining a balance between UI/UX and convenience. Let me now talk about the systems that support DX. While keeping an eye on the evolution of technology, we are carrying out system structure reform for the next generation. On the left, while accelerating the speed of development with low-code and agile development, we will expand investment in strategic areas without significantly changing the overall IT investment. On the right is revision. We will shift to the usage of more generic terminals, open systems, and promote further streamlining.
One of the most important points here is the usage of APIs, and I will explain this point on pages 31 and 32. This page is about the financial digital platform. Through APIs and digital platforms, we aim to provide an open platform that can be used by a wide range of companies without being bound by conventional frameworks. The upper section lays out the functions that can be offered. This setup enables the service providers, including those from different industries, to roll out the functions and services throughout Japan through a wide range of financial institutions among other channels. At the bottom, users such as regional financial institutions, corporations, and local governments can use a platform to access a broad base of innovative and attractive services offered by service providers from different industries.
In the current fiscal year, we have made a number of progress toward the realization of this concept. First, in July, we signed a memorandum of understanding with NTT Data and IBM Japan for the co-creation of the platform. In August, we reached a basic agreement with JCB, Dai Nippon Printing, and Panasonic to start discussions in the field of face recognition. For more information on regional financial institutions, please turn to page 32. Let me illustrate the progress made in the first half. The fact that we were able to confirm solid win-win results with Mebuki Financial Group's app and the Bank of Yokohama's Fund Wrap initiatives will boost momentum for future business development. We have also entered into new partnerships with Keiyo Bank and Hyakujushi Bank.
Through the API linkage and other initiatives, our partners will have access to Resona's unique products and services without having to integrate systems. This is an arrangement that would have been difficult to imagine 10 years ago, and with the evolution of technology enabling such speedy collaboration, we are aiming to build a more strategic ecosystem. We still have a long way to go, but I'm confident that we are moving in the right direction. These are our efforts on the face-to-face channel. By shifting the branch mission from processing clerical work to the provision of solutions, we aim to deliver value proposition that can only be achieved in a face-to-face setup. This is the mission of the next generation branches. Bottom half of the slide shows the image of the new sales and consultation style at the branches going forward.
We have already started to roll out the new branch system that supports this concept at Resona and Saitama Resona from April, and it is scheduled to be completed by December. We have been investing in the new branch system since last year, so the relevant depreciation will push up the property cost this fiscal year. Despite that, we have been able to rigorously control the total cost. In the growth strategy section, I mentioned that solid evolution of KMFG. I would now like to touch upon the group synergies. KMFG has moved from the stage of building the right business foundation to a new stage of achieving results, and there is room for further synergies on both the top line and the cost side.
As I have explained in the past, we are aiming to generate JPY 23 billion in synergies in the fiscal year ending March 2023 compared to the fiscal year ended March 2019. You can see here that we made good progress in the first half of this fiscal year. On the right are some quantitative underlying data on top-line growth and cost reduction. The development of the group's unique products and group knowhow is progressing as expected. This diagram illustrates how we are reforming the channels. We will reduce the number of branches mainly through joint branches or downsizing by reducing the headcounts per branch in order to maintain point of contact with the customers and achieve low-cost operations at the same time. The number of group branches will be reduced by nearly 20% over the three years of the medium-term management plan.
The addition of about 30 joint branches to the plan, with KMFG becoming a wholly owned subsidiary in April, will also contribute to this reduction. This is the third theme of our growth strategy. COVID-19 has triggered changes in the customers' mindsets and lifestyles, and has led to an emergence of new needs. I would like to talk about three relevant businesses in that context. All of them are priority businesses in our mid-term management plan as they cater to the great potential needs amidst the current trends of aging society and cashless society. The top section of each slide shows the iconic results from the first half, and you can see that the figures are very strong compared to the previous year. First, this slide shows the asset formation support business.
The graphs at stop light illustrate that the investment trust income increased by 39%, and Fund Wrap income by 51%, showing significant growth over the previous year. We are aiming to roll out the professional investment management capability we have cultivated in pension fund management to our broader retail customer base. Bottom left is the Fund Wrap balance, which in next February will reach full five years since the service launch, and the outstanding balance has grown to JPY 671.7 billion. So far, we have delivered products to customers of Resona, Saitama Resona, Kansai Mirai, Minato, and from this April, to the customers of Bank of Yokohama, reaching out to customer base outside of the group. The Bank of Yokohama sold JPY 26.5 billion in the first half of the year, and we believe that we have established a win-win relationship with them.
There are a variety of Fund Wraps available in the market, but I think the key to our differentiation is that Resona's Fund Wraps are designed to be highly suitable to the customers of banks. The retail deposit base has been growing significantly, and we will continue to expand the scope of our product offering to provide more retail customers with investment products that contribute to stable long-term asset formation. This is the asset and business succession business. On the upper right, you can see the strong growth in M&A and real estate related income. Bottom left, you can see the status of M&A advisory contracts and the number of leads for real estate deals. We believe that there is still a lot of room for growth in this area given the size of potential needs. The graph at lower right shows the number of new applications for Succession Trust.
As in the Fund Wrap business, you can also see that group wide rollout of the product has ramped up strong growth. Let's now talk about the cashless business. The data on the upper right shows debit card income. This is us achieving a strong growth of 30% year-over-year. Lower left is the number of debit cards issued in one year. The number of issuance grew by 18% to 420,000 cards. In the middle on the right, you can see that the debit card transaction volume was up by 27% year-on-year, and combined with demand stimulation through the Group app, transaction volume has increased more than the number of cards issued. Lastly, on our capital management. The upper section shows the direction of our capital management, which has been presented in the past.
There is no change in our approach of striking a balance between financial soundness, profitability, and shareholder return while aiming to further increase shareholder return. While maintaining a steady dividend, we aim to maintain a total shareholder return ratio in the mid-40% range over the medium term. Based on this policy, we have set a maximum limit of JPY 10 billion for share buybacks. This is a shareholder return action based on the current situation as described in the lower part of this slide. As a financial institution that plays a role in Japan's social infrastructure, we continue to place the highest priority on protecting the lives and businesses of our customers by providing smooth financial services and funding support. Although the COVID-19 situation remains uncertain, we have been able to achieve our goals in terms of both profitability and financial soundness while fulfilling our mission.
We are also aware that the market has high expectations for shareholder return, and we are determined to show a clear path toward achieving our medium-term total shareholder return ratio target. In addition, given the current level of stock price, we believe that this is a highly rational way to utilize capital, and we hope that you will understand that this reflects management's thoughts on stock price. Finally, I would like you to proceed to page 52. I'd like to give you a quick introduction to Resona Group integrated report. You can also scan the QR code on the slide to access the page on our website. I recommend you take a look at this report, as it will help you understand Resona's SDG management from both financial and non-financial perspectives. The integrated report also contains messages from the outside directors.
The full version of the message is available also on the website, so please take a look at your convenient time. With that, I would like to conclude my presentation. Thank you very much for your attention.