Sbi Holdings Inc Ord

Thank you very much for joining us today for the presentation of the first six months of the year, despite your tight schedule. 40 to 50 people are also participating on the internet, and so about 100 people are attending this presentation. Without further ado, we have 145 pages, so we'd like to start the presentation right away. skipping some pages. First, some numbers. As you already know, the revenue, $228.165 billion, or up 18.7%. And the pre-tax profit, $54.512 billion, up 13.5%. As to these numbers, they are record highs. The profit for the period, $38.164 billion, up 8.8%. The profit attributable to owners of the company, 33,104,000,000, up 18.7%. And annualized ROE is 13.6% for the first half. And we will see what will happen in the second half. And if the trend continues, the ROE will also hit the record high for the year. SBI Holdings, Nomura, and Daiwa Comparison. We are on the IFAS basis, Nomura, U.S. GAAP, and Daiwa, J-GAAP basis. so different accounting principles. But for example, for Daiwa, on the consolidated numbers, some bank and the asset management are included. And in our case, the SBI holdings and Daiwa, the home office, the holdings and Nomura, the holdings will be Apple and Apple comparison. So only the numbers from Nomura are available here. But as you can see, it seems that Tietanumura is doing a good job. For the first half, ROE 14.0% in the first half. So they are doing well. Not so much domestically, but probably well overseas. And Daiwa is going to make an announcement tomorrow, October 29th. Next page, buy segment, financial services business. Doing very well. Both revenue and pre-tax profit hit record highs. Revenue, 144 billion 82 million yen, up 27.9%. And the pre-tax profit for financial services, 40 billion 319 million, also record high. This is up 53.9%. Asset management business, record high for the revenue but for the pre-tax profit. It went down a little bit because of the big unlisted companies. Actually, three unlisted companies contributed greatly. in the previous year. This negative number doesn't mean that the asset management business is doing poorly. That doesn't mean that biotechnology-related business, their rate number has been reduced greatly. Next page, about dividend. Interim dividend, the same 20 yen as last year's interim. And if the second half is good, then we would like to increase the dividend. We will see to make judgment. Buy segment, more details. Our securities business, as you already know, The operating revenue, the record hit high at 74 billion, 13 million, up 27.9%. Net operating revenue, 68 billion, 858 million yen, up 32.5%. Operating income, 27 billion, 237 million, up 50.7%. And ordinary income, $27,316 million, up 49.3%. Profit attributable to owners of the company, $18,988 million, up 61.8%. Here we are looking at average daily individual brokerage trading value. Compared to fiscal year 2019, if you look at the right-hand side, fiscal year 2020 first half was better. It's up 52.4%. And among this, actually, our trading value increased more by 73.5%. And commissions increased by 61.7%. One of the reasons is good performance of foreign stocks. There was a very good factor that I'm going to touch upon later on. SBI security is overwhelming position. There is a comparison here, and as you can see, SBI is dominant, both for the number of accounts, deposit assets, operating income, and the share. We are dominant here. In 1999, we started in the same way, using the same systems, but the performance is now so different. Bank-related business is doing very well. And so this is the 7.6% increase for the equity earnings. from the other equity method companies. And this is for the other JGAP basis since the inception of SBI submission at the bank. It continued to increase ordinary income, but because of the BOJ's negative interest rate policy, it's down a little bit, but already recovered from it and from the other fiscal year, the other 2017. And in the second quarter, fiscal year 2020, the numbers will surpass the previous year, the same period, because the announcement will come on November the 12th. So please wait for that date. The number of accounts and the... Internet banks comparison, the deposit is increasing. As of the end of November, it was 5,743 billion, but now it increased to 5,841 billion and with 4.2 million accounts. And on the monthly basis, the number of accounts and the deposits are increasing as to the insurance business. The ordinary income up 25.9% and ordinary profit up 122.8% at 184 million yen. And the profit attributable to parent of the company up 247% at 773 million. And these are the bullet numbers. The more detailed numbers will be available later on. And the SBI insurance group has been buying the SSI entities. And on average basis, CAGR from March 2015 to September 2020, 16.4% increase. Compared to our standards, it's not really a high number. But if it increases too much, that will be translated into expenses. So the profit-wise, it will not be that good. So this level of CAGR increase is good for insurance business. Asset management business, the revenue up by 8.2%. Some negative elements. Here, profit before income tax expense, 24.8 billion yen. Please look at asterisk number one. Accumulated impairment losses to reflect the declining occupancy rate in the aircraft leasing business, about 4 billion yen of the impairment losses. But if you look at SBI Savings Bank in South Korea, 13.9 billion yen, up 65.5%. and profits from the change in fair value and profit on sales of investment securities. They did very well for listed securities, but the profit is not so big for the unlisted securities in the first half. As to IPO for the full year basis, it was very good. And we expect that there will be over 25 companies. There are good names included. The fintech companies or bio companies of good caliber to be listed. As to SBI Savings Bank, when we purchased it in 2013, there were some criticisms. It's true, back then, 51.6% NPL ratio was there. But now it went down to 1.8%. And the performing asset is increasing. which stands at 972.8 billion yen, or exceeding 10 trillion won. To revitalize the bank, I think, is very easy. It was a success for the Korean bank. So it is also certain for Japanese banks because our group can utilize all kinds of capabilities to give support to Japanese banks. Even Russian bank is very likely to go into the black. So banks... Even those banks on the verge of bankruptcy, they can be recovered. We used about 130 billion yen or so to make this bank recover, and they made a very quick recovery. And following SBI securities, this entity is a cash cow. The SBI Sames Bank will surpass full-year results of the previous year in the first nine months. and the Morning Star Japan celebrating the 20th anniversary of its listing. Thanks to you. They transitioned to the first section of the Tokyo Stock Exchange from just stock listing. Both net sales and ordinary income are increasing. I'd like to pay special attention to the following for Morningstar Japan. That is corporate defined contribution plan or DC plan, both for corporate and individual DC plan. Especially we would like to increase corporate DC. going forward in coordination with other strategies. And here we have e-advisor DC promotion department. And now we have more than 7.5 million DC subscribers of corporate plan as of the end of July. And when it comes to pension, it is very important. Why corporate nation or individual pension is important? Well, because... We had started a new company even before the involved in pension business. Close to 1,900 trillion yen of the individual assets and 54% of which is deposit, which is not good for the investment or the asset accumulation. So we need some incentives given by the government so that this huge amount of money will go into investment. The International Financial Centre, if we're going to make it, these investment activities should be part of the centre of it. Not many countries have such a huge source of money, and there will be lots of money managers coming into this market. When I was working at Nomura, The oil price went fourfold back then, and all the money went into the Middle East. Every three months or so, Saudi Arabia Monetary Agency or the Ministry of Finance, Bahrain and the rest of the area, I went to that area very often. And there is the place called the cheap side at the London city. and we encourage them to invest in Japanese vehicles, like stock and bonds, and we can create a similar situation again. So the SB Group's assets under management, including private equity, exceeded 3.6 trillion yen in one to two years, I personally think, more recently, to increase it to... 5 trillion yen and to 10 trillion yen in five years. The regional banks and their investment is mainly for the JGB or the municipal bonds. But they will be redeemed and no regional bank will buy the JGB again. 80 trillion yen or so is invested there and about the more than 30 trillion or so is invested in JGB or municipal bonds and we would like to utilize more effectively. about 15 trillion yen will be redeemed. 15 trillion yen worth of JGB and the municipal bonds will be redeemed in three years or so. And we'd like to grasp such data money sources as early as possible. And Mr. Sakura and his team is making efforts in that area.

So for the biotechnology-related business, at bad times for Cork Pharmaceuticals, Every fiscal year, every period, about 10 billion of losses were being recorded. However, in the first half, it is now minus 1.1 billion, 854 million. So, AKI has entered phase three, which is for nephrosis. So, the conclusion is going to be reached fairly soon. And if it's successful, it will be a tremendous value. And if not, we plan to sell it off. For biotech, we do have a rich pipeline. And with Kirin Kyowa Hako, with entities and such, we have been delivering the And for ALA-related, it has been steadily progressing. So it's just quirk, which is the problem. Once we pull out of it, we believe we will be on a good track. And also, due to COVID-19, The clinical trials for Cork's acute kidney injury prophylaxis has been somewhat delayed. However, blood sampling after 90 days and the follow-up observation has been completed as of September the 21st. So now it's just doing the data cleaning for clinical trial database DBL. And then by the end of March of this fiscal year, we will be able to reach a conclusion and we'll be able to sort things out. So that's where we are with this. For Ella, for cisplatin nephropathy protection, phase 2 was completed in September. We'll now enter phase 3. For mitochondrial diseases, phase 3 is underway, and it's scheduled to be completed in April 2021. At Oxford University Hospital and First Patient Inn, it's expected to be completed by early November. So for Phase 2, it will also be held at Leicester, Birmingham, and Cambridge University Hospitals as well. For brain tumors, Phase 2. For PDT. Photodynamic therapy. It's the therapy part. So if you have a brain tumor... that is in a solid state where it's so large, three centimeters wide, it's hard to conduct the surgery. By utilizing Ella, you could use PDT. And if you are administered with Ella, the ingredients will be gathered in the tumor's part. And when you shed light on it, you'll be able to treat the tumor. So that's basically the theory. activated oxygen may be generated. With regards to the mechanism, they are currently working on it. However, they are working on the preparation for phase two. For breast tumors, phase three is under preparation. It is being conducted by a Canadian company. Photonamic, a wholly-owned subsidiary in Germany, has entered a partnership with a Canadian company, and they will be preparing for phase three. So this is a PDD, photodynamic diagnostic agent, for Allopromo. They have various types of foods with functional claims. Improving quality of sleep with alloplasmic memory or cognitive improvement functions with SBI, ICHOHA, Ginkgo, Bilboa. And also improvement in exercise capacity with alloplasmic carotid active as well as functions to improve high levels of fasting blood glucose levels and postprandial glucose levels. And currently, these products are under sale, but under development are products to reduce cholesterol and blood pressure by utilizing germinated rice. And also, we are currently developing some ALA food products that improves depression and mood together with the University of Hawaii. And we are also working with Hiroshima University for recovery of fatigue. And also with Hiroshima University, we are working to increase metabolism while suppressing sugar absorption, not only with aloe, but also with celosia, derived celosinol. We're also working on male menopause improvement. Men actually have menopause. I haven't, but we're working on that. And also within fiscal year 2020, we will be working on the fatigue reduction after exercising. But in any case, we will have a wider product lineup in place. So we believe that this part of the business will grow steadily as well. Drugstores carrying these products have grown to 17,396. For the major drugstore chains, they have started to carry ALA products as well. So the group's competitive advantage became clear in the COVID-19 crisis. That's how I feel. First of all, The group's online utilization, which was in place since its inception, led to a further increase in customers and in revenues in the wake of the COVID-19 crisis. So, looking at the number of brokerage accounts, in February 2020, we have exceeded 5 million and surpassed Nomura. And as of March, we completely surpassed them. And currently, we are close to 6 million accounts now. As of today, we may have already reached 6 million accounts. Every year, we're growing by 10.6% from here. So we are overwhelmingly number one right now in the industry. So at Nomura, the growth rate is 1.5 when you look at Kager. For SMBC Nikko, we have been seeing an increase because they merged with France Securities. And for Nisa Accounts, Finally, we have surpassed Nomura. We are number one in the industry now. For Nisa accounts, the customers who open up accounts, 69.2% of them are new, out of which 69.7% are beginners of investments. So these are the new customers we are getting. For junior Nisa accounts, we currently have 98,000. which is approximately 30% of the entire securities industry's junior NISA accounts. That is the share we have acquired. We have completely made the fees free, and we have been seeing a buildup of accounts. And March 16 until 2020 September, CAGR has been 53.1%. And when you look at the cumulative number of SBI benefit system subscribers for D.C., it has been growing, the individual type. And also, the balance of the Zemes Trust for 401k individual type distributed by SBI Securities. has grown, and the CAGR from 2016 March to 2020 September has been 51.3 percent. There aren't that many products that grow at this rate, at 50 percent, but we are seeing this growth at our company. So, with regards to the cumulative number of individual D.C.-planned customers, we have been industry leader. It used to be Tokyo Marine, but we surpassed them in October 2018, and we have been widening the gap ever since. So for SBI securities, looking at our productivity, it is far higher than that of Nomura and Daiwa when you look at this chart. When you look at productivity, it is the operating revenue and operating income per employee that we are comparing here. So when you look at operating income, because we're using online, the number of employees that are allocated is less. That's why it is higher per person. And for profits as well, this is 45 million per employee, but for Nomura, it's only 5 million per person. So this is very important. I don't know how you will look at this, but when you think about the future, productivity per employee is key. Some companies carry a lot of people, and they are trying to reduce the number of headcount. So everybody is working from home these days, and they're working remotely. Some people are trying to reduce the personnel cost by having their people work remotely. So for SBI, Sumishi NetBank is expanding its business base faster than its competitors. September 2007 was when it was established, and it was able to reach the dominant number one position over a short period of time. Mortgage volume is growing rapidly as well. As of June 20th, the cumulative total of housing loans balance exceeded $6 trillion. And when you look at it per employee, once again, SBI, Simishin Net Bank, when compared with other megabanks and compare ordinary income and ordinary profit here, This is what's interesting with the bank. We have the highest productivity, and there are differences amongst the mega banks as well. Sumitomo Mitsui Bank is 29 million, as you can see here. And for MUFG Bank, we thought they would be a little bit higher per employee, but they were at 14 million, actually. For the insurance business, It has also displayed its strength amid COVID-19. This is interesting. As of March 2021, Q1, direct premiums written. When you look at the year-over-year change, ours increased by 22.1%. So this is SBI insurance. For SBI life insurance, the change on a year-over-year basis was 35.2% up. Other players are down. So amid COVID-19, customers are migrating or shifting. Or when you look at efficiency of the companies and net expenses, which are labor costs, advertising costs, and et cetera, in our case, we are at 17.7% at SBI insurance. Other players are at around 30%. For life insurance, premium income per employee, we are far higher than others, as you can see, for SBI life insurance. By looking at these KPIs... you're able to see whether you are able to manage your company in a productive manner. And I think this will determine the order of the ranks of your company in the future. So strategies to further strengthen competitive advantages during the COVID-19 crisis. We think we're doing well so far. However, we are trying to do it even better. And how are we going to do that? First of all, for the securities-related business, proactively, we will engage in M&A activities to further strengthen overall capabilities for fees. We have been saying that we will continue to reduce them. So, we would like to leverage our comprehensive capabilities even more. In a diverse business, we need to generate our revenues. So, first of all, We used to be growing through organic growth mainly, but we would like to be more active in M&Es. We would like to strengthen competitiveness through synergistic effects with existing businesses and cross-evolution, and we would like to expand economies of scale. And also, we would like to go through stepping stones towards global expansion with a focus on the future. Global will be a key word going forward. Everything is going to be about going global. So for new businesses in the future, I will question whether that can be globalized. How can we globalize the business, especially for virtual currencies or crypto assets? In that kind of business domain, this is the way I think. And for M&As, we will expand business foundation through M&A activities through the new securities and new bank initiatives. And M&A activities will basically be carried out by SBI Holdings or an intermediate holding company. For example, we have, if we acquired shares for B2C2 or Lifestyle Securities, and also we invested into Hifumi. So these are some examples. So for Lifestyle Securities, it is very unique. Around the trader segment, it is being highly supported. So for margin trading, the fees are waived, and that is how we have been able to expand the customer base. So acquiring this entity was very important for us, and that's why we made the decision. And as of September of 2020, the number of accounts is 190,000 accounts, and AUM is $276 billion. So the SPI group covers a broad range of customers from the high-end segment to traders and the future asset formation segment. We would like to offer various types of services to various types of segments perfectly. So that is how we would like to be organized. And in fact, so this is SPI securities share of individual stock trading. When you look at SPI securities alone, we have been able to increase our share to 40.3% from 35.3% when you look at share of individual stock trading value. and also of which share of individual margin trading value was 41.5% from 35.4%. And on top of that, Livestore has contributed by 3% as well as 3.8%. And we are striving to reach 50%. Also for the cryptocurrency business, globally, whether it be Bitcoin or XRP, this is something that is global. So all the systems need to be global. All the ecosystems need to be made in a global manner. And to that end, we acquired B2C2 from the UK. They are a crypto asset market maker company. We announced that we're going to acquire 30%. But finally, the Financial Services Agency of the UK has gave us the approval to acquire 90% of their shares. So this entity will be consolidated. And from Z Holdings, we acquired Taotao. This is a small issue, but also we endeavor to further increase trading revenue by expanding the customer base and leveraging the strengths of both companies. So going forward, if there are opportunities that are good, we would like to go after them.

So we will buy them globally. So this is Hifumi and Mr. Fujino. is a great portfolio manager. I have met him several times and talked to him, and that's my impression of him. AUM is 160 billion yen. Because the performance is so good, You know, they're gathering a lot of money and their AM is increasing. So this is expanding the customer base through alliance with companies in different industries and continuing to further growth. So we will be forming alliances, SMBC or Takashimaya. And in banking business, we're collaborating with Japan Airlines. And I will talk about this later, but Yamada Holdings, Hikari Tsushin, Asahi Kase Insurance, we're working with motorcycle manufacturer Escrit. So these are all, you know, positive steps for us to realize our new securities initiative. And, in fact, we're moving ahead. We're making progress on this. The scope of free transaction fees at SBA securities is actually increasing. For example, you can see this pressure trading for large-scale margin trading have been changed. And also we have, as of October 1, 2020, this is the new zero commissions for both cash and margin trading. And we... Now, as of November 2nd, we'll be offering fee-free domestic ETFs that offer no free transactions. We will have four brands. So this is altogether 113 ETFs that we will be handling both cash and margin trading, which is the largest number in the industry. I have been saying this before, but you can see that we're making great progress here. And we will realize NEO security initiatives in three stages. So that in order to achieve this third step, SBI Securities is endeavoring to reduce the contribution of commissions to operating income to become less than 5%. Now, as overseas foreign equity, we can just simply increase our transaction. And also in SBI Securities, how much can we earn from cryptocurrency? Basically, they're in a position where they can offset it with other businesses. And this is true with any other business, but we think that whoever wins the share takes the greatest share wins, especially in the Internet world, winner takes it all. So it's really about how much share can we capture. I think it all comes down to that. And the customer base is important. With this backdrop of very large customer base, you can actually improve your quality. And because you're able to improve quality, you'll be able to increase your customers. So basically, this is the principle that works in place. And so it's a virtuous cycle that allows us to continue to expand our business and grow. This is the current initiatives to realize neo-securities initiatives. There's six I have listed here. So we just started off with a brokerage business as an online security business. In 2003, 71% comprised the commissions. And you can see that this ratio has been decreasing. In fact, this first half has increased slightly to 29.3, but you can see it's a nice decline. And online brokerage commissions for domestic stocks accounted for 19.3% of all brokerage commissions. So you can see a steady decrease, and we want to decrease to 5%. And we will continue to reduce fees as we monitor the situation closely. And you will wonder why we can do this without suffering our performance. But the key here is that we will keep maintaining our performance, you know, our financial results. In fact, we have demonstrated that already, right? So, for example, we are increasing our wholesale business, and we have been number one, basically, in IPO underwriting participation rate for the last few years. The number of companies that went public in that particular, so, for example, 27 in here, you can see that we are either underwriter here in 24 cases. And many of these companies may be small today, but they will continue to grow. So we will continue to keep this relationship as a lead manager so that we can increase our wholesale business, not only just for primary, but also in secondary underwriting as well. And that's the significance here. And you can see our track record. So, for example, regional power companies are issuing corporate bonds and they're asking us to do it. And M&A, we need to continue to strengthen this. This is an important business in wholesale. So we have, you know, M&A always comes with financing. So this is a very big deal. So we are basically striving very hard to increase this business here. And let's say that number of advisory contracts increased over three times if the number of cases in first half of 2018 was one. And thanks to regional financial institutions' support, SBI's financial institutions sales department has been really increasing significantly. So, for example, transaction volume of first half 2019 is one. Then the equity trading has increased 1.9. Investment trust has increased to 5.7 times. So you can see expansion in this department as well. We have been able to do foreign bonds as well. This is the investment trust balance of how it's rapidly increasing. You can see that big upstart surge. And we have achieved record high on a quarterly balance. And Robert Advisor, this is Wealth Navi. This is 64.1 billion just in AUM for a securities business. And if you actually combine the customer base with SBI NetBank, then it's actually 95.4 billion yen. And this is a business where we can get a lot of management fees, stable revenues, and also trading revenue. you can see that there's a significant increase, not in just FX-related revenue, but revenue from crypto assets. This is a 64.9% increase year-on-year. And with regards to foreign exchange and cryptocurrency, crypto assets. In various measures, we have been able to do different businesses. We have done CMD, B2C, we have done collaborative marketing, we have started funds for crypto assets. This will be done between 2022 and And you can see that co-managed branches with regional financial institutions have rapidly increased in terms of their accounts and AUM. Let's say there are six regional banks, and it's like we take four. So, excuse me, if the regional banks take 60%, then we take 40%. That's the structure. So... In total, customer deposit assets increased by 90 times as compared to October 2017. That's the new business. You can see that that's a track record for September 2020, 90 times. And we established a total of 16 branches with 12 banks to operate joint operations, starting with Tsukuba. And you can see many others wanting to join forces with us. And if you look at the customer deposit assets and their attributes, they do many structured bonds, very popular with the regional, rural, high net worth customers. And you can see attributions. You can see this nice breakdown. In 2020, October 2nd, we will be launching second branch with Sendai Bank. And in addition to that, aside from three regional financial institutions that are planning to open a second branch, a regional financial institution is nearly planning to launch another co-managed branch. With regards to IFA business, IFA stands for Independent Financial Advisor. It seems as though this is a pure play, a rakuten, that's how it's written, but actually we are overwhelming number one. If you look at the trend in SBI Securities, IFA Business, say you am locked in is 0.6 trillion. You can see we're 1.7 trillion. That's how different the gap is. You know, we never really announced it because there's many other things we wanted to announce, but that's it. But because it's perceived as Rakuten's main business, IFA is their dedicated business, their strength, I want to make sure that we're actually number one. So SBI securities foreign stock trading volume. Again, this is an area we want to continue to strengthen, whether it could be Biden or Mr. Trump that will win this election. Some people say it's Biden. Some people say there's great fans of equity trading who are Trump's fan. So we don't know how it will turn out. But in any case. I think transaction will be very active. And I think as long as there's transactions, that's good for us. So Amadei, you can see these are the areas we want to continue to work in. And this is the Neobank Initiative. Again, this is our collaboration with the Yamada Holdings. Yamada has large customer base with over 12,000 physical stores in Japan and abroad and approximately 60 million members. And we will be able to provide banking service, online banking service to Yamada. So this is a great strength for Yamada and for us as well. It's positive for us. So this is a sort of alliance that we want to be very thorough and be active. And we will be able to increase the corporate value of both companies and improve the convenience of the society. And net move, security has become increasingly important. We have implemented Smart Authentication Neo in July. It's receiving high regards. So I think that Netmove was a very good company. It's been a great success.

SBA Group's comprehensive strengths are fully demonstrated in the regional revitalization efforts through the revitalization of regional financial institutions. So what have we done over the three years? The collaboration with regional FIs and the more development with new partners. So we would like to make it advance and go deeper. SBA Securities already are cooperating with 42 regional FIs. and for the intermediary business and so on, SBI Money Plaza and also via the SBI Life Insurance started the cooperation with 24 regional FIs and SBI Insurance with 19 FIs and SBI Neo Financial Services. The nine banks have introduced a white label banking app with two more in consideration. So I'm not going into details. Morningstar Japan, 142 regional FIs have adopted wealth advisors, and they are using the wealth advisors to sell investment trusts to their customers. It's a must, indispensable for them and money. Top 38 institutions have invested in them. and it will be a very important connection. I'm looking forward to it. SMEI regional revitalization, 38 invested, and with 570 billion yen of AUM. And we would like to... listed so that you can benefit. And SBI investment, 74 regional FIs have invested in venture capital funds. If their performance is good, that will contribute to the improvement of regional FIs' performance. And for the FX, the SBI, the remit, there are four banks using SBI remit for international So we're doing more and more. We are making advancements with the new partners, as you know, SMBC, Niko Securities, and SBI Money Plaza are in the strategic alliance. and the 33.4% of SBI money plaza, or more than one-third of stake, that will be purchased by the SMBC Nikko Securities. And that announcement was made in September. And we have to send four people or so to one bank, and for Money Plaza efforts and so on and so forth. And on their part, they are very aggressive, and we'd like to secure the good quality personnel with experience in the securities so that we can continue to send our people to the regionals. financial institutions. So SMBC Niko Securities Alliance is a good news for us. We need people of good quality. And so that's why we have approved to give 33.4% of SBI money and plaza shares to SMBC Niko Securities expecting receiving people of good quality. I think it's a gentleman's agreement. And SBI Life Insurance... And now we have 118,182 applications or 24 in three years is the number of applications for credit life insurance. New initiative is to form a joint credit system with the General Incorporated Shinkin Bank Association of Nagano Prefecture. By each prefecture, we would like to similar initiatives to increase the number of customers. And Alliance with Keystone Partners, it's a very good company. We invested one third of the stake, 33.4% of their stake. It's not equity deal. I mean, it is not about the equity business. It is about the debt business because Keystone Partners is very good and helpful in helping us to expand the debt business in regional areas. SBI Regional Bank Holdings is committed to solving the challenges of its strategic capital and business partners and their customers, Shimane Bank, Fukushima, Chikuho, Shimizu, Toa. As we have been saying, the maximum should be 10. and we have a very clear idea of who will join the team. But we need to visit FSAs, and there should be attendance at the executive officers' meeting. The decision-making scheme of regional banks is so different from ours. It's not a question of good or bad. It just takes time. We will not go beyond 10 regional banks as an alliance. It could be eight or nine. It's not that the bigger the number is better. But there are banks who want to ally with us. And the question for us is whether we can give real support to them or not. In that sense, there are some common issues for regional FIs. Sophistication of securities operations, they have to work on fintech, and they have to deal with increasing systems costs. And from different angles, we'd like to give comprehensive supports to them. SBI regional bank holdings will be a hub to provide all of these functions so that we can leverage our comprehensive capabilities in a very centralized way. Because there are some common issues among those regional financial institutions. So we can use the common prescription. And so Morita-san is taking the lead in these efforts and a self-transformation of the regional banks. And the new prime minister has also used this word, self-transformation. I met with him over breakfast. And he said, Kitao-san, I read that newspaper article and we met at Hotel Okura. And there was an interview with Yomiuri newspaper a few days before that. And I said that it's not about self-transformation. I said that very clearly to the interviewer of Yomiuri newspaper and the prime minister liked my comment. It's about self-transformation. It's not about restructuring. It's not about restructuring. That's what I said to the interviewer of Yomiuri newspaper. It has to be self-transformation. There should be a very strong willpower to make that happen. And when you want to do that, When you want to transform yourself, it might be translated as denial of self, of what you have been doing in the past. But you need to think about how to change the conventional behaviors or actions. And also, you need to think about what should be changed on an organizational level. basis and you develop yourself and as well as you develop your organization. Self-transformation, self-denial and not only the personal basis but also on the organizational basis, you should do that. And we'd like to help those financial institutions when they do that. So what about Shimane Bank in the first half? So bottom right, the 2019-2020 And please look at the changes in the cooperating income and ordinary income at the top, how it has changed, how it has improved. Well, a drastic improvement in profitability in the area of alliances with the SBA group, including fully outsourcing of securities operations to the SBA group and operating of the co-managed shops, and reduced various costs through restructuring stores and promoting selection and concentration of businesses. So it's a self-help, self-assistance and mutual assistance process. And as a result of that, such improvement was made. When you look at the PBR table, 0.21%. 0.43 in one year from September 2019 to September 2020 no regional bank achieved this before so the investors are evaluating very highly our involvement and they are observing those changes don't tell me just show me that's what I always tell my people show me Show me. And that's where it happens. So this is what we have been doing in our own organization. We decide on doing something and we made that happen with the full spirit. And I do not hesitate to see people leaving our organization if they can't do it. Steady progress on initiatives with subsequent partner banks. So this is just the September and October examples are shown here. And if we have to talk about everything, then we need more paper space. And here we have the rapid increase in number of accounts and the customers' deposit assets. The Shimizu Bank started in March 2018. And the revenue increased 69.1 times, 16.7 for number of accounts and 9.6 for customer deposit assets, starting point being one. Chikuho achieved 140.3 or 42.6 and Shimane 63 and 33.3 and so on. So it's a big success. SBI Holdings AUM expanded. The capital and the business partners, about 30% of the consigned money So that means that the 70% comes from the entities without such partnerships. And that makes 1.5 trillion yen of AUM. As to Toa Bank, Strategic Business Alliance, Toa has already made an announcement on that. I skip details here. I do. it's okay for the partner entity to explain about the alliance in a comfortable way, in a comfortable way for them. The only thing that we care about is that their results will improve. How to explain about the alliance is not that important. regional revitalization partners, joint initiative with several partners. The financial institutions alone cannot recreate the regions or localities. There should be other lines of the business and the knowledge and the people. And also local governments should also be in the picture. So in order to revitalize the local economy, everyone should work for that because it's part of the national strategy. So now we have partners such as DBJ, Yamaguchi Financial Group, and Shinsei Bank, and Concordia for regional revitalization partners. So my favorite phrase, public good will lead to the private, the good or interest that will be realized. There's no investment involved here. This is about planning how to improve the local economy. So there are some experts of the local economies here. involved in this effort. And this scheme has been explained to the top people of our partners So on the human resources basis, the regional revitalization partners, the five other companies, have right to dispatch people as directors for SBI regional revitalization services or revitalization investment and loan, but they should be limited to one director per entity. Under SBI regional revitalization services, we set up silent partners for systems, HR succession and smart city and international financial city or environmental energy. And the fund size here will be 30 billion yen as minimum. And here, SBI Group owns more than 51% and about 10 shareholders, but the capital will be small at 2 billion to 3 billion yen level. While SBI regional revitalization investment and loan capital will be 100 million to 200 million yen and the several shareholders. and who are going to be shareholders. There will be mainly from big investors. And for this entity, we form limited partnership for investment business. This is the same message. Business feels to focus on for new innovations toward future business development. And I'm going to start up new businesses in addition to the original revitalization. And we will thoroughly work on revitalization of localities. But not only that, there are things that we have to do. One is as follows. The real estate development companies, the synergies are with us. And another is the entering into the medical informatics field, importance of which was recognized during the COVID-19 crisis.

So for real estate, we have a lot of high net worth customers at SBI Securities. So managing equity is one thing. And another important asset management is in the area of real estate. So We haven't been in real estate in a large way in the past, so we thought that was missing. So we would like to strengthen the real estate brokerage business. And we would like to target high net worth customers. We have no intention of turning into a developer. And we endeavor to establish a consulting service that will meet the needs of each customer from both real estate and financial perspectives. So a customer might have this much amount of money. We could consult them on doing asset management from a financial point of view. If we find good property, we could propose to them, why don't you allocate some of your money into real estate? That's the kind of advice we can provide in order to do this. In China, a top-class life insurance company in China, which is Ping An, we have decided to acquire shares of Ascot. P&I is a large financial conglomerate, and Ascot is a JSTAC-listed company. They are in the real estate business. They plan development of condominiums as well as offices, and they also do value-up projects of used property and offer real estate solution businesses. So we would like to partner with them. And also, The Global is another company that is in view. They acquire land, and they also have a tech record on condominium development. ASCOT will enter a partnership with Global, and the three entities will develop a new type of property business. There's various types of meanings attached to this. So high net worth customers is our target area, and it's a matter of how we can enrich our service that we provide to them. That's one aspect. Another thing is that We will withdraw from Hong Kong, was what we mentioned earlier, before, and we've received letters from people in Hong Kong. But we would like to go into mainland China instead to develop a financial business. So we believe that Penang will be a good partner in this regard. And I have a good relationship with Mr. Ma, It's not just a financial business, but Mr. Ma, in the area of Ella, he is a great fan, and he takes a lot of Ella. He thinks it's really good, and he's also said that he's passed it out to his friends. So we'd like to develop an Ella business in China. So a deep relationship with Penang is what we would like to develop. Also, medical informatics is something that I felt strongly about this time around. In Japan, when it comes to medical statistics and the aggregation of data, we are quite behind in building big data and analyzing it. This kind of method and capability, we don't have it at all in Japan. We are behind in IT in the real estate area as well. I didn't write it in the slide, but digitalization is a We are behind in real estate as well as medical informatics. So that's why I would like to do something about it. So it's not just about investing into Ascot, and we're not just going to offer services to the high-worth customers. The next step will be the digitalization of real estate business. We would like to do this strenuously. Of course, sometimes in front of the station there is a real estate company, and people will visit those stores. That used to be the case. And also in Japan... For real estate, one of the characteristics is that all developers are quite strong. They develop condominiums, and every part of the process is covered by the developers. So it's hard to enter this space unless it's used property. But it's fine. I would like to go into secondhand property as a business. For medical information, we want to build big data with regards to predicting the outbreak. What kind of people with what kind of diseases are likely to develop COVID-19? And blood types. There's a lot of research that's happening globally. It seems that type O is... less likely to contract covet and less likely for the symptoms to become more serious and type a is likely to get a covet 19 more but in any case the research leads to the same conclusions wherever you are in the world but in any case we want to gather and aggregate all this data and make decisions on it but we don't have that system in japan If there is a certain disease that is a problem, even if they haven't contracted COVID-19, these people may need to be hospitalized at an earlier rate. That kind of decision can be made. Even more, I forgot the actress. What was her name? Because I'm not interested in that space. So I forget their names easily. But the actress, she had breast cancer. And she was going through treatment, but she was at home. So this is ludicrous. If they were going through cancer treatment, it means that their immune system is very weak. They definitely need to be hospitalized so that their symptoms don't develop into serious symptoms. If remdesivir is approved, they need to take it every day. And also Avigan. About 10,000 people are taking it. What's happening to them? What's happening to their data? It's not being disclosed. And at Fujita University, there were 75 people that were able to see that it's effective, but we're not able to tell anything from that. We're offering ALA to the Bahrain government, and NIH is also doing clinical tests in a group of several thousands of people. So this is what we need to do. If we're not able to do this, we won't be able to aggregate big data and we won't be able to verify the data. We need to be able to do this. I'm going to turn this into a business for the sake of people. I want to make this effective. something that we can use. And this is related to the revitalization of regional cities as well. Takegushi-san has a business called J&B, Japan Medical Business Corporation, and we have a JV with them. We would like to engage in a health account business going forward. So J&B, and we have made investments into Ogaki Kyuritsu Bank, and for hospitals and so forth. The health account business has been established as a business model already pretty much. So what we would like to do is we want to rapidly develop this business and engage this business as soon as possible and to regional financial institutions as an interesting opportunity initiative. We hope that they could come on board. So the Prime Minister has been talking about self-help, mutual assistance, and public assistance. For self-help and public assistance, Yo-san Uesugi has been talking about this a lot. So President Kennedy actually paid attention to self-help and public assistance. He said that you need to think about what you can do for your country instead of just thinking about what the country can do for you. It's a famous speech. It actually comes from Yosano Uesugi and his philosophy. Therefore, President Kennedy back then said that it's one of his Japanese people that he respects deeply. And then the Prime Minister talked about talked about this as well. We believe that the health account business will be extremely important as an initiative for maintaining the health of people and for regional financial institutions to strengthen their ties with the people. So for self-help, expenses related to one's own medical care should be reserved in advance into a dedicated account and prepared by oneself. And for public assistance, for mutual assistance, the The minimum necessary medical insurance will be provided in case a significant amount of medical expenses are required. As for public assistance, we should have efforts made to realize health account balance inheritance deduction, and so forth. If that happens, we believe this will develop quite rapidly. All of our people are insured right now in Japan, and it's a universal medical system. But, of course, it's not going to hold for a long period of time if the finances of Japan are going to stay where it is. Because nursing care insurance as well as medical insurance keeps on increasing. But if you start to help yourself from when you were young and accumulate... money in your account and have a health account at the regional banks that will help you. So it's going to happen in an installment basis with time deposits. And if something were to happen and if you were to visit a hospital, the medical expenses can be paid in an advanced manner in this capital structure that we have with Dr. Takegushi. through MEX and MFT. And then, for users at hospitals, they won't have to wait for payments, and we'll be able to promote cashless payments. And also, we will work on collecting the advance payments for medical expenses as well. And when we start this initiative, I'm assuming that each region will have one prefecture, one prefecture will have one regional bank that offers this kind of health account. So for each of the prefectures, one regional bank will work on this initiative. And then people will be able to accumulate their savings for these types of contingencies. Of course, in the future, it might be numerous banks per prefecture. And for the public assistance part, we could work together with the government and lobby towards the government for something to happen. So for our financial business and regional financial institution business, we believe that this kind of initiative will connect these entities with local economies even more. So these are the types of concepts and ideas that we need to come up with by using our wisdom. So advanced adoption of blockchain and DLT, which is expected to become the next generation core technology for the financial sector. So we would like to continue to do this through a money tap. Currently, 38 companies have made investments, and we will continue to do the implementations. So that's where we are right now. So, going forward, money cap will be used for P2P. We could pretty much do this for free between the banks instantaneously. Remittance fees are not expensive like it was before. We would like to make it as free as possible. And also, not just for P2P, but peer-to-business, P2P. Even for this area, for the Connecting to prepaid charging service providers will enable QR payments and corporate remittances, and we hope that people can adopt MoneyTap to do this. So the prepaid charge operators will be able to gain more security in the services they provide because we plan to implement EKYC. So for the banks as well as the prepaid charge operators, their concerns can be wiped away because we'll have EKYC. On top of the existing three banks, three new banks have been offered connections. So we'll have a total of six and negotiations will continue as well. The more you use this, it will become even more convenient. So for line pay or pay pay from January 31st and March 31st, they have already announced that they are part of this system. But for currencies as well, for Kyushu Electric and Chukho Bank and ourselves, we've worked together to issue digital currencies. The Zaifu Pay or premium local coupons or Fukuoka's Ukina City has also been issuing their own digital currencies. We would like to develop this nationwide in each of the regions of Japan. This kind of idea is something that we would like to make nationwide. I met with the president of Kyushu Electric the other day, as well as Mr. Sato, the president of Chikuhou Bank, and talked about this initiative. And we were able to reach a consensus. So eventually, we'll be able to conclude a contract so that we could have a JV in place. Furthermore, on this platform, what's important is Kyushu Electric's IT system is important, of course. But S-Coin's platform, we built it using Corda. This is important, and we would like to use this in a full-fledged manner. It's by R3. Also, we would like to create the new next-generation financial products, establish the security token issuance and distribution markets. So now, crypto asset derivatives and STRs were covered under the Financial Instruments and Exchange Act that became effective in May 2020. We now have good laws in place. So now... We need to be compliant with law and turn it into a business. And we established a self-regulatory organization as well. Twelve companies are regular members. The main ones are already members. And we also have 41 companies that are supporting members. So a total of 53 companies are currently participating. So for the self-regulatory organization, it has been already approved of, and I will be serving as the head for the time being. And we would like to run promotions going forward. And in order to start, owing to the amended field law effective as of May 1st, the Japan's first security token business is scheduled to be launched by using SBI eSports. So SBI Holdings will be doing the underwriting. And together with NRI, Blue Street will be utilized as a platform. And we plan to acquire a 10% stake. We could have done it alone. However, when it comes to these types of initiatives, We believe it's a public asset. It's like our PTS. We believe it's a public asset. So we didn't want to be competing with someone else. Rather, we have 10%. But actually, I am not satisfied. I want to increase this investment amount even more. And I think we'll be able to generate a track record. And I think going forward, eventually, we're not going to be staying at 10%. So security tokens, we would like to continue to offer investment opportunities to general investors as well. And also the world's first digital asset bank, Signum. We are planning to establish a joint fund, whether it be Ether, Bitcoin, XRP. I mentioned earlier that everything is global. We need to think about things in a global manner, whatever it be. For security token offerings as well, in various regions there are various regulators, so we need to gain approval from each of the regions. But when it comes to the expertise and know-how, we will be accumulating a wealth of expertise, and we would like to gain licenses in each of the regions we do businesses in, or have partnerships with entities that have a license already. So establishing a global ecosystem to develop the security token market at home and abroad, this is what we will continue to do.

Already today, for example, the second largest stock exchange in Germany, when they wanted to... To start up a business, we raised our hand and joined forces. Switzerland, Signum Banking, I have just mentioned it's a very hot topic. And also, we are scheduled to establish a new company under the auspices of FCY Digital Asset Holdings to oversee security token business in Singapore and in the United States. There are two track record companies called Securitize and Templum, which we have already invested in. Now, next is about next generation international financial center concept in Osaka and Kobe. Before attracting this international financial center, there are things we need to do, and that is we need to develop an enhanced existing infrastructure, the financial infrastructure. On 1st of October, TSC had to stop completely. So we were not able to do any equity transaction on this platform. Why did such a thing happen? When similar incident happened in New York, New York Stock Exchange, it wasn't a big issue because they had alternative exchange to trade in. TSE basically has put in their utmost efforts to monopolize this market. And we tried to break that through PTS. But then they said, for three years, they said, you can't do margin trading. And I think I have told FSA that they're responsible for this as well. I said that to the prime minister as well. If you continue to do things like this, you will not be able to establish international financial market. You need to have an alternative market, PTS, because TSE's market share is 87%. How do they avoid antitrust law when they merge with Osaka? They said, because PTS, they're not monopolizing the market. That's what they said. But that's completely wrong. They did not allow margin trading, and the problem still exists. So it took three years to allow us to do margin trading, but it does not allow us to do this nighttime. And now they said because SBI Securities is the large shareholders, they can't do trading on PDS. And I'm wondering why it's not possible when you can do this systematically, automatically. And, you know, all the committees and advisors are basically influenced by TSC. So when they established a council... I think it's just a collection of people who don't really understand. And they have this big excuse that this is what the council says, advisors say, and they don't allow us to do this. So since 2006 and 2005, I mean, they were major system failures. This is an article from Asahi Shimbun on October 1st, 2020. You can see these are the major system failures that had occurred at TSC. And you can see, you know, this is TSC concentration on TSC. How could Japan become a financial center? when TSC monopolizes the market. So I said this. Their market share is 87 percent. New York is 21 percent, NASDAQ 19, Chicago 16 percent, and PDF others comprise 44 percent. And if you look at the system, so, for example, virtual server, which is the entrance of the exchange, can only process about 200 transactions per second. I think NASDAQ's average process is several thousand transactions per second. It's completely different. So we use NASDAQ. In Osaka, we will be building second PTS and we'll be implementing NASDAQ system. It's cutting edge. And the second PTS will be ordinary shares, handling ordinary shares. Securitized or security tokens will eventually be established. So security token distribution markets will be established eventually. And in terms of operation and services, they lack an attitude of pursuing fiduciary duty, their delay in coping with troubles. It's unbelievable that the market doesn't open for an entire day. Unclear criteria for trading suspension measures. And they should be following all PTS services. For example, the introduction of increments after decimal points. You know, they're following a trend. Actually, the government's role is to allow competition so that they can actually improve the services. That's the role of FSA, which they have not done. And as for the commissions and trading, it's quite a bit cheaper than the – I guess among the lowest in the world. But I think that this brokerage commission could be zero commission. And market data fee is actually very high compared to global standards. So there's 10,000 pieces of data of the Japanese market, and they're selling this at a very high price. In 2006, we established the oldest and largest BTS operating in Japan. 33 companies are participating in the market so far. Something like this should be developed and should be competed in the equal footing grounds. And that's the best way for fiduciary duty, whether it be institutional investors. In U.S., they would have to do discretionary trading. And if, you know, it was basically using a higher-priced system, then SEC could penalize them. So Japan is doing basically what they did in Stone Age. And we are currently still doing this legacy system, this legacy scheme. It's impossible. And I hope that the Suga administration will reform this, change this one way or another. And I think this is the outright cause which I want to continue to insist on. You might say, Mr. Kitao, if you say that, you'll have backlash from DAC. The FSA will tell you otherwise. If there's a... something wrong, if there's an illegal element to it, then that would be a problem. And I will point that out. So in order to foster a competitive PTS, and I said this to LDP party as well, we need this. We urgently need to develop a new PTS in Japan. and promoting intermarket competition for in terms of new trading facilities. Regulation of the market share, for example, if trading on PTS exceeds 20% of share of an individual stock and 10% trading value of public exchange, it must become a public exchange. A normal thinking will be looking at... They will calculate on the market share of PTS divided by public exchange. I'm sorry, normally you would calculate it as BTS divided by a sum of public exchange and BTS, but that's not the case in Japan. This is a foolish calculation method. An FSA commissioner was quite surprised when he learned about this. He said, I'm sorry, I didn't know about this. It lacked knowledge, but he was shocked. And please read the rest of it. Media need to work to make the society better. If you're outbeaten by power, authority, you will lose out. You know, I'm old and I'm still fighting the authorities. I think you should, the media should fight back as well. So these are the adverse effects of high exchange clearing fees. If you look at JCC's fees, it has not been reviewed since 2008. Even though online brokers are increasing and they're paying so much money, JCC 2008 have not reviewed it, revised it since 2008. As a result, the money they make is incredible. And finally, at the bank level, Finally, there's a breakthrough in CATHIS and ZenkiNet. Now you have to, they need to have a breakthrough in JSCC and Just Deck. And I am mobilizing the opinions of scholars and lawyers, and I want to bring this subject up to FTC, JFTC, because we need to change this. If you look at this, if you look at the clearing commissions of JSCC, 2006 April, it's 10,000 of 0.06 yen per 1 yen. Currently, it's 10,000 of 0.04 yen per 1 yen. The volume discount is maximum 5%. And just the transfer fees, we've been insistent, and therefore they have changed slightly. But the recent revision was 2016. So basically, TSE Group is the only one that's making profit of this. And remember, TSE is a public company. How could a public company monopolize this? This is... The fee table of overseas, you can see it's very different. The maximum is 97%. UK is 97%. Japan is max 5%. It's unbelievable. As a result, what happens? If you look at the financial structure, you can see their CAGR of revenue was 3.03%. Even though operating expenses is increasing by 4.66%, they still continue to mark profit margin at a very high level. And how could they have an ordinary profit margin of 30% or more, 30.65% recurring profit ratio? And you can see that JC's fixed liabilities is low with 50.1 billion yen of retained earnings added at the end of March 31, 2020. Cash deposits increased to 60.5 billion. Why do they need to build up so much cash? Jazz deck. Operating revenue grew at the kicker of 4.74%. Operating expense was minus 7.155. The recurring profit remains at 50.65%. I said to the Prime Minister, Their profit margin is higher than telecom companies. It's inconceivable. It's impossible. Something like this should not happen. They have basically near zero fixed liabilities. Their retained earnings has added to 46 billion. Their cash deposits increased to 28.5 billion yen. Don't you think this is strange? So they need to fix this. That's important. That's number one. And secondly, you can't spend too much time fixing this because a lot of things are moving very quickly. Japan, May 27, have acted super city bill, and there has been a major move towards realization of smart cities. In fact, today in management committee, Mr. Takenaka Hazel is part of a director, external director, and I have asked him to do this. But, you know, Hong Kong's two-country-one system has broken down, and this is a great change in trend. If you look at the general survey, one-third of Japanese companies are considering withdrawal or downsizing in Hong Kong. And with regards to the base of operations, Hong Kong, making reconsidering the future 15 percent, scaling down 12.9, reviewing the function as a central base, 4.5 percent. Withdrawal is 1.7 percent. Altogether, it's 34.1 percent total. If you look at London, because of Brexit, how many... banking institutions are leaving london so for example giant jp morgan chase is removing 200 billion euro in assets to uk germany by the end of the year eny is saying that they're moving 1.2 trillion pounds of the assets to europe And they go to Dublin, Luxembourg, Paris, Frankfurt, Amsterdam. The companies are transferring operations all else. This is Brexit. What happens if Hong Kong becomes, you know, basically there's a breakdown of one country into a system? There's an European institution that I talked to, and they said that everything they do in Hong Kong, they hedge it. And it would be nice if, you know, if Osaka City does what you say. We no longer need to do hedges. China is actually a great opportunity, and you can actually leverage that opportunity in the mainland China. And the global cities of the world, New York, London, Tokyo, there's great infections increasing on the rise. And that in itself is a risk. So we need to attract next generation global financial center to Japan. And the timing has come. And, you know, over the last 20 years, you know, Tokyo, there's a move towards attracting international financial center, but it has never realized. Now, Osaka, you know, will be really putting an emphasis on promoting this. If they can combine this with smart city concept and if they can encourage the government to act, provide incentives, they could really realize this. I know that the pillars have not been decided. Ripple is actually looking at Japan as one of the headquarters, global headquarters. Now, Osaka is the... one of the birthplace futures market, rice market, commodity market. And Dogema Exchange, I think it's time for them to convert into a comprehensive exchange. That recommendation has been made. They need to become a stock company, and they do the commodity exchange in rice, but they need to become a comprehensive exchange market. So they need to continue to add different commodities. so that they can become a global market. So, for example, the other day, Dr. Bitt from Vietnam is the head of Agriculture Association. Vietnam is number two in cacao after Brazil. And they were talking about, you know, commodity exchange in Japan for cacao. So that's the situation. That's where we want to bring it to reality. And what about affinity with the sub-capital vision? We're not sure what would happen to sub-capital vision, but there's a great affinity with it. And more than anything else, residential land price in Osaka is only 40% of Tokyo, so you'll be able to reduce real estate costs. So, you know, if you're located in Tokyo, you will continue to have this high real estate. And you don't really need to... And, you know, as long as you have a good security, you don't really have to transfer offices anymore. And I was talking to a foreigner... about, you know, why don't you transfer in your office to Osaka? And he was saying, yeah, great. Osaka and Kyoto have great tourist attractions as well. So it has its charm. And also, like I said before, personal individual financial assets in Japan is 1,883 trillion yen, among which 54.2% is in cash and deposits. You need to change this. We're in this negative interest rating environment. The Japanese citizens' asset formation needs to change. It needs to shift from cash and deposits to pensions. And that's sort of... We need to have a tax system that would incentivize people to make that shift, whether it be NISA... When Mr. Suga was a cabinet secretariat, he called this out and launched it. And there's a lot of struggle to do this. But what happens without NISA and IDECO? What would have happened to asset formation? It was good that he was able to realize that at that time. So now we see a big shift to NISA and IDECO. So in Panchen, we really need to do something about this. In order to do this, I said that we will invest $2 trillion and asset management, $10 trillion, and we want to do an M&A fund manager who's actually good at managing pension funds. and suggestions for global financial center concept. So establishing strategic special zone, deregulation in that zone, and reducing tax rates to internationally competitive levels, designing tax incentives to shift funds from cash deposits to pension and other asset building activities, relaxing requirements of visa, all of these. can be realized on self-help basis. As long as the tax is changed, incentives are given. Because you don't change the tax system, we need to use the public assistance. We talk about medical insurance and the pension, which we were able to receive 65. Now their ages are raised to 70, 75. And if you have a job, that's fine, but it's not the case. If you look at the Japanese economic growth, it proves itself. I think self-help is a very important concept. Self-help and mutual assistance and minimum public assistance. Without that, Japanese economy will sink. And the government needs to launch funds with private venture capitalists to foster fintech industry. You have to work with private sector. They talk about METI and then establish all these semi-government agencies. Look at the performance. Now, if you look at South Korea, they are... basically transferring all the funds that's been managed by semi-government agencies to private sector. Basically, if they don't underperform, they change to a different manager. So all the government needs to do is monitor. They don't need to think about parachuting because all the good talents can work in private sector from early age, early on. And English-speaking schools... And we need to make all the registers and all the government forms need to be in English as well. We need to cooperate with the U.K. I think we need to align with the U.K., Because there's a potential to cooperate from geopolitical perspective. For example, the markets are operating at different hours. So we can basically build the system that is complementary. And that's what I have in mind when I established PTS. And examples of how SBI group can support the realization of this concept. So, for example, providing advanced technology in the financial business, we have various fintech technologies. The global community appreciates that. We can attract fintech venture companies to invest through SBI investment. So as a condition to invest, you need to come to Japan. I'm thinking making that a written condition. And building a global comprehensive exchange through Osaka Dojima Exchange is If this becomes a stock company, we will take 15% of its shares. And perhaps we can invite other global companies to take a stake in it. Creating financial products of the next generation and establishing a handling market. We can establish market for issuance and distribution security tokens. We can establish new BTS. We can do that in Osaka. I called up the governor of Osaka the other day. He was in some sort of confusion at that point. But he said, once I'm done with the situation, I will create a task force. I will create a team to work on this. And so he said, Mr. Kito, please, I need your support for that. He said that. So... I think the SBI will continue to have an input in attracting financial center concept to Osaka. And SBI Group will cooperate closely with R3 and Ripple, which could become de facto standard of next generation. And you can see all this lineup of fintech companies that we are investing in. Many of them have gone public. and formation of global comprehensive exchange through Osaka Dojima Exchange. You can have a holding system like this. We need to basically eliminate that monopoly by JPX Group. and we need to establish financial products of next generation and the market that handles that. So, for example, we can build the security token market and the secondary market in Osaka in the future. So we have 15 more minutes to go, and we can take Q&A, and I want to finish at 6 o'clock. So if you have a question, please.