Sbi Holdings Inc Ord

So this is the announcement of the results of the second quarter. Here we have 50 people in the venue and 130 to 140 people are on the internet listening to us. Today we have about 180 pages of the materials. So without further ado, let me start the presentation. So the consolidated financial results of the first half. So April 28th, 2021, we came up with the new medium-term vision for three to five years. We announced this vision on April 28th. In three to five years, we think that the fully-fledged new digital age will start, and we think that we are living in a transitional period right now. And in this transitional period, During this period, we would like to achieve more than 300 billion consolidated profit. Also, the total amount of profit before income tax expense for new business accounts for approximately 20% of consolidated profit before tax definition of new business. any business that utilizes innovative technologies such as digital assets or blockchain, and also any businesses that have become part of the group through M&A since April 2018. So all in all, about 20%, more or less, it's just a yardstick number, as to ROE, 10% or more. We would like to sustain that level of ROE. So in the first half, here are consolidated results. The sales or revenue, 334,283,000,000 yen or up 46.5%. Pre-tax profit, 109,276,000,000 yen or 100.5% up. Profit for the period, 88,938,000,000 yen, or up 133%. Profit attributed to owners of the company, 76,765,000,000 yen, or up 131.9%. As to the annualized ROE of the first half is 24.6%. It's a historical high. And the average ROE of securities and commodity futures listed on TSC first section, it's about 8%, or the 4.1% for the banking industry. So this means that our ROE number is quite high compared to those averages. So as to M&As, during this first half, we did lots of M&As, and that contributed to the expansion of our business in various areas, in the state-of-the-art areas, as I mentioned earlier, or any of the businesses with high potential of contribution to the whole group with significant synergy. Such companies have been acquired the equity method companies, FVTPL, there are certain types. And we have been expanding this business, helped by those acquired companies, and we will continue very aggressive M&A activities. Other than that, in the short term, small amount insurance area, we also did acquire some companies, although it is not mentioned on this page. I will touch upon that later. So the consolidated results, this is the profit attributable to owners of the company, 76,765,000,000 yen. And Iowa Securities, there was a Nikkei article this morning, and they booked 50,203,000,000 yen, and up 53%. Ours was up 131.9%. The previous year, we already exceeded their results, Nomura and others. compared to them, though we are doing better. And this is for your reference, trends in the consolidated results of SBI Holdings and Shinsui Bank. The blue is SBI Holdings. There was some drop in FY20, but already in the first half of FY2021, though we reached almost the yearly level of the previous year. And as to the Shinsui Bank, the 52.3 billion, 45.5 billion, 45.1 billion, 38.8 billion, so the declining trend. And as to ROE, SBA Holdings, 11.9, 8.3, 16, and 24.6. But Shinsui Bank booked 6%, 5.1, 4.9, and 4.2%. Now, by segment... Basically, both revenue and the profit for financial services business, asset management businesses, the record highs as to biotechnology, healthcare and medical informatics business booked record high revenue. It's still the 4,545 million, so it's still small, but it was record high. As to dividend, with the backdrop of good results, the 30 yen as of the end of the half of the year. In FY 2020, it was 20 yen. And now the business overview of corporate business and securities business. Average daily individual brokerage trading value. Year-on-year basis, April through September, increased by 10.8%. So it's not so bad. And our operating revenue also increased by 10.8%. And we have 82,027,000,000 yen. And this is on the J-GAP basis of the first half. And as to net operating revenue, 77,253,000,000. And operating income, 27,584,000,000, up 1.3. Ordinary income, 27,684,000,000, up 1.3. Profit attributable to owners of the company. Some decline, almost leveled, with 18,684,000,000. So this is the comparison with other major online securities companies. Already, Rakuten Matsui and AU Cubcom made announcements, and Manex is scheduled to make an announcement tomorrow or even delayed by one day. So not 28, but the 29th now. Please look at this table. Overwhelmingly, The profit level is changing. We all started at the same time using similar systems and online. The tradings are the main businesses for all of us, all of these entities. But there was a big difference now among these entities. I have said repeatedly about NEO securities initiatives. So the eliminated trading fees for domestic stock transactions and other various fees that are currently incurred by investors. That is what we call NEO securities initiative. And through that initiative, what will happen? I think that the number of accounts will increase to 30 million or so. 7.7 million is the current number of accounts, and I expect it to increase to 30 million. It's a big increase. And that is my hypothesis, one of the hypotheses. And also, the number of accounts will increase significantly by eliminating trading fees for online domestic stock transactions. And also, even if brokerage commission declined, the increase in the customers and diversification of revenue sources will compensate for it. And thirdly, closing the number of accounts will lead to business expansion for various companies in the entire SBI Group ecosystem. So, the other... Customers here will go to insurance and also the other banking side services as well. So they will become the customers of the SBI Group ecosystem once these customers get related to us. More than 32 million customers we have. So 7.7 million becoming 30 million, what will happen when that increase actually happens? That's what I'm thinking. I always verify my hypothesis. What kind of verification? I will show you. So people age 20 or under and the number of new accounts at SBA securities of this age bracket increased 88.6% year on year. Why 88.6%? That's a large increase. For the whole group, it's 29.5%. And the increase of the younger age bracket was 88.8%. And people aged 26 or above increased 62.7%. And for the younger people, the fees are actually practically zero. And 7.7 million to 30 million accounts increased. that hypothesis that is backed by the number of customers and the fee levels. And we are checking that. So what have we been doing? From September 2020, we eliminated certain commissions as shown here. Roughly speaking, With these initiatives, how much commissions were reduced? It's about 2.7 billion yen or the 2.78 billion. And this is the result. The sales or revenue did not decrease significantly. It's true, brokerage commission decreased. However, that was covered by other sources of revenue. So, diversification of revenue sources is working in a very positive way. So, for example, for securities business, when the commission is zero, and buying the stocks. And then he wants to do the margin trading as well. And that will come with some commission. So by changing the condenser portfolio, that we can increase our revenue. Without such increase, the 19,612,000,000 would have produced 22.3 billion yen or up 2.8% contribution. So the multiple number of sources of the profit, more than offset brokerage commission decrease, for example, underwriting, offering commissions, sales commissions. up 159.3% year-on-year. Financial revenues and margin trading expanded rapidly as open interest reached record highs. Other commission received investment trust, for example, increased up 58.3% year on year. And the stock trading commissions, other than online trading, up 13.8% year on year, so forth. So in a very steady manner, We are utilising other sources of income and we are covering the decrease in the brokerage commissions. The third hypothesis and its verification, newly registered customers through measures that eliminated certain trading commissions use various services of the SBI group. Numerically, we have not checked in details, but I could tell that we are right because our ecosystem is designed that way. So all of the three hypotheses have been verified. have been justified. We can continue these hypotheses. One concern that I have is systems. 11 million will be covered by the current systems, but I want the systems that are capable of covering 30 million accounts. So because I do not want to see our systems explode, that would be a big problem. So once we become very confident in our systems, maybe in one year or so, I think we can have systems that are strong enough. 12 months to 18 months. we would like to work more on the elimination of the commissions, and we'd like to work on the new securities initiatives, expand product services, strengthen recurring revenue business, strengthen the wholesale business, expand trading revenue, and stock trading commissions other than online trading. These five measures, we will work on them and others for the coming 12 to 18 months. Here we have expansion of products and services to provide diverse trading opportunities. I will not go into details. Please read them if you are interested. And for the shared point side, this is what I call open alliances with various players, including T-Point. And newly, we have pointer point. The number of users here is more than 100 million. And the point with the SMBC, it's about 47.5 million Sumitomo Mitsui card members. And the number of members is increasing. And this V point can be converted to other points as well. That's one of the merits. So we are promoting these three point systems aggressively. But we need to be aware that the points are costs. So we have to look closely how much cost. For example, Rakuten has Rakuten, the economic zone, that they are using points to expand that zone. So what is the profit that they are getting? I would like to talk about that later as well. The recurring revenue type business, that is to increase the credit business or to increase financial revenue, and as to the accumulation of the points to buy the investment trusts, for example. Currently, the balance of that kind of trading is increasing. And as to, we have the made folio, the subsidiary, which is specialized in theme, the investment, and wrap the management. And we are going to start the SBI wrap and the fund wrap from March 2022. And this is the connection of the different services and the different functions to increase the customers. And as to wholesale business, For the first half of the year, there were 60 listed companies and our underwriting share is 100%. We are either the underwriter or the lead managers. Actually, nine companies that we were involved as lead managers, not only for IPO, but we are also focusing on PO underwriting. The number of underwriting cases in the first half was of 2021 increased three times year on year. And the corporate bond underwriting business is also increasing. 23 corporate bonds underwritten in the first half and also the public bonds, including electric power bonds. They invite us nowadays to be part of such underwriting without us making an approach because of the powerful sales capability of us. The money plaza that is penetrating into regional banks more and more and jointly managed the stores. with 14 banks at 22 locations, and that is also boosting our brand name, thus to expand our business. Now, the trading business, FX, and the digital asset-related business, up 28.8%, up 1.5%, respectively. The VC trade, TauTau, the VC2C, the B2, C2 rather, are simply summed up for digital asset related to business. The initiatives to strengthen the digital asset to business, expanding the line of digital assets, Adavisi Trade are the pro, a newly joined Polkadot and Chainlink. And also for the Adavisi Trade sales counter, Odyssey, In addition to these two other currencies, we also listed Bitcoin Cash and Litecoin. So 500 billion as the market cap. I have been saying that I would do whatever it's out there. That's not our intention. If we start with the small market cap and if somebody takes 51% of the stake from you, what would you do? So we'd like to keep them. with the minimum of 500 billion of the market cap. And in December, VisiTrade and TaoTao will merge. and to produce SBI VC trade. It will go into the type one financial instruments business and virtual currency exchange service provider. The newly born SBI VC trade will have these two licenses and we are going through these many different services and we have almost completed our preparation for that. And as to foreign stock trading value, So with the foreign stock trading value index for first half of fiscal year 2018 being one, first half of FY 2021 number increased to 5.3. So the U.S. stocks is in the center.

And also, we would like to meet the needs of face-to-face customer transactions, especially in the IFA business. And so we have been taking measures to reinforce this business. At SBI Securities, revenue grew 1.3 times year over year. It increased by 30%. Also, for SBI Securities, looking at the AUM trend for the IFA business, it reached 2.1 trillion yen. So overwhelmingly, in the IFA business, we have became number one as well. Also, for Money Plaza, I mentioned 14 stores with 22 locations, AUM, as of July, exceeded 100 billion yen. It is currently at 113.8 billion. And for new face-to-face salespeople who are competent, we have been hiring them, training them, and at the co-managed shops, we have been allocating them. Fortunately, at SMVC Nikko Securities, they have been allocating their people at 18 of the shops. So this partnership, from a personnel point of view, has been helping the growth of the number of shops. We would like to also expand business into the real estate finance business. So we have acquired 35% of Ascot Corp and also acquired... about 56% of total shares of Tozai Asset Management Company. We would like to do private placement reads. And also, we are engaging in selling real estate small lot trust beneficiary interest funds through Money Plaza. So we are basically diversifying to engage in new business opportunities for the banking-related business. For this business, as already announced, On October the 8th, we have applied to be listed on the TSC. After listing, we will operate its business with independence and strive for further growth at SBI Submission Net Bank. So the meetings that I am engaged in, as of December, they will be concluded. Then after, the bank independently will be formulating its strategies And for the customers, they are going to have independence in the management of their operations. Of course, we will be the parent company. And if asked, we would like to do whatever we can with Sumitomo Mitsui Trust Bank. And if it's a win-win outcome, we will work together. Having a relationship with a public company, this is what is supposed to happen, especially when it's a bank, because the FSA is extremely strict about these things. And to that end, back in 2007, we established this bank, and to date, We have continued to develop and grow this company so that we could now list the company. So it's 50%. Therefore, the equity and earnings grew by 11.1% year over year and reached $4,461,000,000. So we started operations in fiscal year 2007. We achieved a full-year profit in fiscal year 2009. Then after, we have been continuing to grow the business. And then the BOJ started its negative interest rate policy, and profits fell at that point in time. But then after, we continued to grow income. And in fiscal year March 2021, we were able to grow ordinary income to exceed $20 billion. So we have already exceeded last year's Q2 numbers, so we should be around here for this fiscal year. We achieved full-year profit on a full-year basis in the past, and then after, we basically steadily increased ordinary income, apart from external impact. So this is the outcome of how we have managed our bank. So since opening, here is a trend of number of accounts and balance of deposits. Now, the number of accounts has reached approximately 5 million. And for deposits, as of October 26th, it has reached 6,659,000,000,000 yen. So even when NERP by the BOJ was introduced, apart from that year, we have been seeing constant growth in a linear way. So Yokohama, Bank of Yokohama and Shiba Bank are the top two when it comes to the amount of deposits. We are here. As of end of March 21, we were number 17. Actually, Shinsei Bank was number 18. That's 6,293,000,000,000. If you add it with Shinsei Bank's amount, And compared to Bank of Yokohama and Chiba Bank, we come in third. We will be in the top three from a deposits point of view. For Sumishin SBI Net Bank, the deposits exceeded $6 trillion. It was at $6 trillion, $628.4 billion at Sumishin SBI Net Bank as of September. this is the growth we've been seeing from March last fiscal year until September this fiscal year. So we are seeing steady growth. So this compares the deposit balances between SBI Sumishi NetBank and Shinsei Bank. Like I mentioned earlier, from a ranking point of view, initially, in March 2020, we were ranking below Shinsei. And In September 2020, we were also below Shenzhen. However, as of end of March 21, we exceeded. And we are probably going to exceed once again against Shenzhen. So we're growing by 11%, 10%, 16%, as well as 15%, which is the most important factor. However, for Shenzhen, the growth rates are only at 6.4, 8.8, and so forth. Now, for the sustainable growth of SBI Sumishi NetBank, initiatives of focus will be, for one, the mortgage business. It doesn't engage in loans to corporates. Therefore, what they're doing is collecting deposits. They collect deposits and they manage it and generate spreads. that turn into the income for the bank. They're putting emphasis on the mortgage loan business so that they could generate spreads. Of course, through investments, they are generating spreads from the securities-related initiatives, too. So when you look at the balance of mortgage loans, starting from 2008, it has continued to grow. As of 2021 end of September, it has reached 5 trillion, 231.3 billion. The cumulative total of housing loans exceeded, as of August the 6th, 7 trillion yen. And just for your reference, for Shinsei Bank, from 2008 until to date, the loan balance has only hovered around the 1 trillion mark. Moreover, for our company, we would like to expand our customer base. and enhance our profitability, and we have implemented new initiatives for that purpose, which is the NIO Bank initiatives. Finally, at this point in time, on a monthly basis, when it comes to account openings, if you are benchmarking against April, as of September, it went up to 33.4. We have now Jiao NIO Bank, as well as T-Neo Bank, which is a partnership with T-Money, which is the T-Point operator, and Yamada Neo Bank, which is a partnership with Yamada Finance Service Company. Furthermore, with the OG House Group, or the Open House Group, excuse me, in linkage with OG Link, we have started OG Bank. By engaging in these initiatives... we will be able to have a diverse range of earning sources. So it's basically our bank functions. In this case, we provide it to Open House for their use. So they will take advantage of our banking services in various ways, whether it be foreign-denominated currency deposits or loan products or something related to houses, paying utilities or internet fees. they can take advantage of all the services we offer, basically. And for the insurance-related businesses, which is the SBI Insurance Group, on November the 10th, they will be announcing their results. On a JGAP basis, the final numbers are going to be announced on November the 10th, and these are preliminary numbers. For ordinary revenue, we expect 7.8% growth and 51.4% ordinary profit growth. And profit attributable to the parent of the company has grown by 49.3%. In all of the items, the business is doing very well. For the insurance groups, total number of enforced contracts, comparing March 2016 to September 2021, CAGR has been 15.8%. People say that insurance is a saturated market, so it shouldn't be growing as much. However, in the case of our company, we have been able to record such CAGR, meaning that we're going after market share. When you look at the results of the questionnaire that the insurance company conducted during COVID-19, people had a tendency to review their insurance policies so that they could take out cheaper insurance policies. It seems that many people considered and a lot of people took action. And I was surprised to see the results of the questionnaire. So, increasingly, this will be a tailwind for our business. So I touched upon this earlier, but basically it's not just organic growth that we're pursuing, but M&A is also an important part of our strategy to reach 300 billion. So this is something we will continue to work on. So one of the pillars of the business is non-life insurance and life insurance as well as a small amount short-term insurance. For SSI, There are now five SSI companies that were incorporated into our group. We would like to continue to pursue M&A opportunities. For all of the companies in our group, customer satisfaction is one of the most important factors we focus on. If satisfaction goes down at one of our entities, I will personally go to the head of operations of that entity and ask why customer satisfaction has been deteriorating. I will make a phone call because I put a lot of importance on it. For each of the companies, it is a key indicator that represents your performance. So we are mostly first or second place, as you can see here. Also, when you look at the total amount of SSI insurance income, when you look at our performance in 2017, 18, 19, and 20, we finally, in 2020, have been able to exceed Zenkankyo Group and Tokyo Marine Group. And we are now number one in the industry. We would like to continue to be so. So for all of our group companies, We are striving to improve operating efficiency and engage in initiatives to expand the customer base. This constantly needs to be on our minds. What kind of scheme should we put together to expand our customer base? And furthermore, under such schemes, will all the participants be happy? We need to create a scheme that will satisfy everyone. And for management efficiency, on the other side of the equation, we will ensure that we will continue to incorporate new technology. We make investments around the world because we want advanced technology and incorporate that into our company. That's why we're making the investments. And where possible, we will continue to implement them and we will continue to transform ourselves. So this is self-transformation and self-evolution. We need to be like that as a person, and we need to be like that as an organization. If you're not able to do this, you will continue to subside. Linking SBI Nihon SSI's insurance application system with a real estate company's application management system is what we're trying to work on so that we can expand, enhance customer convenience, and also improve operational efficiency and expand the customer base. This is what we're trying to do. And also, we would like to further improve operational efficiency and customer convenience by promoting InsurTech. So for SBI insurance... they did a major renewal of KASHATO Speed Code. So for the non-life insurance premium quotations, the necessary information can be automatically read and a quotation can be displayed. At life insurance, it can completely automate reinsurance of life insurance premium deduction certificates. Or by using Alexa of Amazon, they launched new service to estimate insurance premiums. So in this way, we are incorporating technology to make our services even more convenient for our customers. Next is the asset management business. So for this business, most of the items are record highs. So revenue increased by 84.8%. Profit before income tax expenses grew by 221.1%. For SBI Savings Bank, grew by 32.3% at $18.4 billion. And also, the profit loss from the change in fair value and profit and loss on sales and investment securities, this grew substantially by 248.1% to $53.6 billion. initial phases. I was attentive to Jafco's numbers. I forgot for a while, but now when you look at their numbers, the numbers are so different from ours. So I talked about profit loss from the change in fair value and profit loss on sales of investment securities. If you look at the details, it can be separated into listed and unlisted securities. For listed securities, it was negative. The reason for the negative numbers is because of Shinsei Bank. We own about 20% of their shares, and it includes a valuation loss that will be recorded at the end of the year. So at Q1, there was a valuation loss of minus 14.2 billion yen. For Q2, we are currently in the process of a TOB. So according to IFRS, we evaluate based on the previous day's closing price. to the day the takeover bid was decided. So the loss was about 200 million minus instead. As you can see under number three, the reason for the valuation gains for the unlisted securities is because of Lancium in the U.S., which I will explain later, as well as Drive Wealth, also based in the United States, which is an investment-related company. these two companies, as well as this was a valuation gain. And also, we were able to record a gain on the sale of PayD, because PayPal acquired it for 300 billion, and we were a major shareholder. Of course, there were some unlisted stocks whose businesses have not progressed as expected. So there were some businesses that didn't perform well because of the pandemic. And they needed to go through another round of funding and so forth. So we took valuation losses worth about 14 billion yen. Of course, I hope this starts to settle down as we have ended wave five of the pandemic. But in the winter timeframe, there is cyclicality. We might see another peak. after a trough. So that's based off our past experience. Same thing applies for the flu. So if wave six comes, we're not sure what's going to happen. But as management of the company, we need to be accounting for that as well. But this time around, I think the situation is going to be somewhat different because of vaccinations. The vaccination rate is already at 70%. And probably the boosters will start from January next year. When we're in that kind of situation, I think we will be able to get infections under control. And we will get herd immunity once we exceed 70% in the vaccination rate. And some people are saying that when cells increase and expand, they expand in the wrong way, and the proliferation starts to change. So Delta was really strong. But people are saying it's self-destructing and has become weaker. So that's the self-destruction theory, like an apoptosis phenomenon. There are some experts around the world that are saying so. But any case, former Prime Minister Suga said vaccinations are critical, and it turned out that it's been justified. And thanks to him, we were able to conduct vaccinations in a speedy manner. And now 70% of the nation are vaccinated, which is worth noting. So next for the private equity business. In March 2022... We expect 34 to go to market and 12 for the half year realize an IPO or an M&A. So for these 12 companies last year, there were 12 for the full year. So now it's 12 for six months this fiscal year. And there's still 22 companies to go in the second half of the year. We created a 30 billion yen fintech fund in December 2015, and an AI and blockchain fund in January 2018 worth 60 billion. Then after, in 2020 April, we created a 10 billion yen fund, which was the greatest size ever in Japan. The investees are starting to go to market, and now we're entering a harvesting phase.

So, in fact, it is the financial service business, so asset management business. These are two wheels of a car, of a vehicle, which contribute significantly to the profit. And, in fact, this profitability is sustainable. So I think that's what you can be said. And also, with regards to overseas financial service business, if you look at SBI Savings Bank in Korea, in comparison with the first three quarters of the previous year, it's plus 51%. In won basis, it's 293.1 billion Korean won. In 10 yen, it's not 10 yen, but it's about 29.3 billion yen. So according to the Korean Ratings Agency, it's now positive. So just one more step and they will be able to pay out dividends, hopefully from next fiscal year. So this bank was just about to collapse. And then we came in in 2013 and spent about $130 billion to buy this company. And we were severely criticized. But look at the result. In just a short period of time, So in 2015, we were already full year net profit, and we have been recording record high each year until today. And in 2020, December, look at this. Just for your reference, look at Shinsei Bank's performance. So SBAI Savings Bank is just a non-consolidated basis. So we're now comparing Shinsei on a non-consolidated basis as well. But in 2014 fiscal year, they were 45.7 billion net income. And you can see they have been declining year over year. I might wonder, how could they continue to decline like this? What could they do wrong? As I have been explaining from before, in our SBI group, there's no company like that. The companies that we invest in, which we have acquired and invested in, I would say almost all of them, their performances improve. Why would they not improve? And what happens if they underperform? So, for example... Maybe a group of young workers at Shinsei Bank and maybe, you know, ex-directors of the bank sent me letters. And they say, please buy the company, acquire the company, restore their past glory, change and transform the bank, please. They're the only company they have not paid down the public injections that they have received, 350 billion for 20 years. And the management, the fact that they are still getting paid bonuses, and of course they have to receive compensation, but it's quite unbelievable to me that they're getting director's compensation or bonuses. And if you worked for a company like this, how could employees continue to be hopeful, to have aspirations? The fact that the company you work for continues to grow. The group company that you work for is contributing to the parent profit. Those things become motivation or motivation. It becomes your pride and it becomes your confidence, especially for the directors and executive officers. So what is this company, which you cannot be proud of? Why is it? Because they don't have a clear vision and corporate philosophy. That's a mission. So companies that lack things like that turn out to see the underperformance. So this is my impression looking from the outside. We invested in Vietnam, TP Bank. In 2018, they went public. And now they're about 220 billion yen. We have 19.9%. FTP securities, broker dealer, we have 19.9% in stake. Now their market cap is above 40 billion. So as the country continues to experience high growth, financial business will also grow. Same thing with Japan, right? In our high economic growth, it was the financial industries that grew first and then was followed by manufacturing sector or transport sector. That's the structure. So this is, it's the financial institutions, it's the financial sector that really takes off in high growth market. Now this is asset management business. Morning Star. Japan's asset management business has been growing very steadily as well. This is because of the expansion in the investment contracts from regional financial institutions. Very large contributions from there. So how much exactly are they entrusting us? Actually, the balance of AUM of the two companies... SBI bond investment management and regional revitalizing asset management together, they surpassed 2 trillion, about 2.2 trillion, exactly. And it's not just the eight banks with capital business alliance with SBIH. Actually, they only comprise 35% of 2 trillion, 65%. are banks without any sort of capital or business alliances. So 65% entrust us. And SBI asset management group, including that 3 trillion yen, if you add everything else, the balance investment assets exceeded 3.3 trillion yen. That's the amount of asset under management. And in addition to that, In the asset management business, we have a core important business, which is private equity business. This is investing in non-public listed companies. So I said earlier, we have 12 this year, and 22 is the last year's full year. And what we have a great expectation for is the $100 billion fund, the largest in Japan, which is SPI 4.5 fund. And these are the investments in Society 5.0 and Industry 4.0. It's wide range. So the investment areas include different sectors. And with regards to SDGs, we have been investing around the world at a very early stage. and we invest in the environment as well. A lot of focus here. Earlier I said that there's a foreign company which we sold, and we have had realized gains, and we also had some gains on sales, and Lancian is one of them. And what does it do? U.S. West and part of U.S. is very much good for building wind power plants. And what they do is they purchase electricity from wind farms at very low cost. It's a clean energy. And they use it for hosting services, cryptocurrency mining or AI computing at universities. So that's how it's done. So they often say that mining consumes a lot of energy, but this is using clean energy. So whatever that used to use coal energy, it's converting to clean energy. And 90% of the energy that's used is carbon neutral. Many of them are wind power energies. And through this, so we invest in companies like this. Also, even in Japan, there's a company called Windows Smile. It's wind power, solar power, biomass, geothermal investments. And we employ specialists from 12 different countries. It's quite advanced, somewhat unusual in Japan. They go from development to different types of power sources, and they go from installation to maintenance. And also ERI, Eco Research Institute. It's a system that develops recycled municipal waste. So these are ordinary, general municipal waste. And they produce a biomass energy from that. So what they do is they produce biomass-derived fuel from municipal waste through pyrolysis of waste material and flex mix together by installing the system in local government clean centers. It is expected to reduce waste disposal cost. So Hamamatsu City has already said that they want to implement the system. I went and visited the Chiba plant as well. These are the things that we want to invest in proactively. And this will become our core. And as part of the project for regional vitalization partners and with the services, they will continue to expand the business. And also SBI Energy, our subsidiary. They were doing farming-type solar power generation. So in other words, while they're farming, you know, they're always farming, like, crops, you know, soy and wheat, and they farm. And at the same time, so they manage farms, but they also supply energy. They generate and supply energy. It's quite profitable. And we are actively investing in emerging countries through funds with leading local partners around the world. So these are establishing venture funds with both private and public funds and invest around the world. And we have information coming in from around the world. And this is a new fund, new PE business in digital area. This is the area we really are putting a lot of focuses on. So for example, we're working with Signum. This is the world's first digital asset bank licensed by Swiss authority. And Azimut is an Italian resource management company. So we decided to establish a joint venture fund. And we will be investing in different digital asset-related companies around the world, but mostly in Europe and also in African continent. So I have traveled to more than 100 countries around the world, but Africa is one continent I have not been able to visit, unfortunately. Now, of course, I have been to MENA, like Morocco and Tunisia. I have the northern part of Africa, but the rest of Africa I have not been able to visit. But this is the continent with potential, and so we have to start right away. We must start now. So we have decided to partner with Verod Keppel, Africa Partners, for investment in Africa. So I have been talking about investment business so far, but now with regards to financial services business, I would say in Southeast Asia, we have joint ventures in most of the nations in Southeast Asia, and many of them are already profitable already. They have been recording profit record high, basically achieving each year. So everywhere you look, they're growing. This is what I've been saying from before. In high growth rate areas or in the countries where they're in the high growth period, it's the financial services that's really growing because the backdrop is that the banking business, the financial institutions will also become profitable in the backdrop of that. So the challenge here is to invest early so that you can keep the cost down. And we have started early as well, saving the bank. Now, the non-perform rate is 1.51%. They used to be 51.6% in delinquency, right? This is when we purchased the company. Now, the management of this company was no good. He was a fool. Banking business, in principle, should not go bankrupt. The law, the banking, they're protected by banking laws. And, you know, they're gathering money from small companies. And so they can't go bankrupt. So they can't fail. And that is why the country, the government would inject public funds, for example. I think that the government of Japan, BOJ as well, have been too easy. Maybe it's good, temporary. Maybe they had to help out the local entities, companies. But banks, they lend money and they take interest, they charge interest. That's how they run their business. So the fact that they borrow money and can't pay back, that's not possible. That can't be the case. Maybe one, two, three years they can be patient. Maybe maximum five years they can be patient. But, you know, if they can't pay back decades, 10 years, 20 years, how could it be a bank? It's not possible. What we're doing is justice. One reason is because they're not paying back the money they borrowed. People say that the government will only buy back at 7,000 yen per share. They say, no way, how could that be the case? That's not possible to pay back. No, I completely refuse that, reject that. Because what happens is those who borrow money under pandemic will never pay back. Even in the Capital Alliance Investees of SBI, I always say that you have to put utmost effort into paying back public funds. It's taxpayers' money. Of course you have to pay back. And I say to each president of the banks... And I say this very stringently, right? Mr. Morita, do you agree with me? They come and visit me every time. And every time I see them, I say, please pay back the public funds as quickly as possible. And if you borrowed it again, you have to pay back once. You can't reborrow or refinance. I think it's problematic to refinance unless you pay it back once. Of course, we will assist you as much as we can. That's what I tell the presidents. That's how, in one sense... You know, they're saying banking business is different. TOB or hostile takeover is not possible in banking industry. But to start off, what is hostile or friendly? I think it's a nonsense to use words like hostile or friendly. Whether it's hostile or not, it should not be determined by the management. It's the shareholders that determine whether this is hostile or not. So as a new word, I want to say constructive TOB. So... It's outdated to say hostile. If you're here with the newspaper company, if you're representing newspapers, media, don't use those words anymore in this capitalism. If you want to revitalize this capitalism, and as a method of making this country wealthier and prosper. We have to let those nonsense, stupid management exit. You have to get them out of this. Drive them out. So they talk about poison pill. Fine. Go ahead and do it. Let's say they will pay more than 2,000 yen. We're saying 2,000 yen maximum. And I already think I'm paying enough premium. And I don't plan to increase any more than that. If there's a white knight who wants to buy higher than that, I say, fine. I said, we will give it with you, wrapped with ribbons. But like I said earlier... But for justice sake, I think I have to show one example via model. And in the Q1 financial results, I was asked, why do you find Shinshae so attractive? Do you want to buy that company? And as you saw in your reference, There's nothing charming about the company that's tracked about the company that makes you want to buy it. And my answer is valuation. That's one reason. The other is because we think we can transform the company, the bank, Shinsei. And I am confident that we can transform the Shinsei. That's what I say. So Russian bank, this was about to collapse, and we acquired it. And we have 98.74%. And they have become profitable for the full year. Well, I guess only half a year still. But in first half of 2021, they have already achieved profitability. And you can see the gross profit. And they can achieve net profit. And you can see the loan balance increasing as well. Unfortunately, the signing of US, I'm sorry, Japan-Russia peace treaty seems far away. But putting that aside, we're a private sector. So I believe that we should be maintaining relationship with Russia. That's my judgment. Of course, hopefully this will be positive to, you know, political development. And of course, the Abe administration back at the time was pushing for business relations between Japan and Russia. So we decided that we will also bail out Russian bank. Hopefully that will lead to the friendly relations between Japan and Russia. So in that sense, our DIF, which is equivalent to JBIC of Japan, and also Japan's JBIC IG partners itself has asked to invest. So the Cambodian bank, we acquired a medium-sized microfinance company in Cambodia, and they obtained a full banking license immediately, and they became profitable right away. and we can further grow them. Now, we started online broker dealer in Thailand. Compared to March 2019 and 2020, excuse me, I think we should double this year. Now, Africa, the last growth frontier. Already new interesting businesses have started. SBI Africa, this is the company we established. in SBI Motor Japan. It's a cross-border EC site in the local south. And in Kenya and Nairobi, we have an office called SBI Motor Japan. One problem with the business in Africa is remittance. If we deliver products, are we able to actually receive money promptly? You know, as a consideration for the product we deliver, can we receive that money back? I think that's the greatest concern we have with the business in Africa. And I'm looking at being able to use Ripple's XRP to do the payment. Because the bank in Africa, we don't know what happens if there's a coup d'etat, for example. There's a lot of imaginable things that could happen, so we have to be cautious. Furthermore... Gariba is a Japanese used car broker. And we used that company. And we are now working with FMG, which provide vehicles using microfinance. So, for example, in Tunisia, Uber driver... doesn't have any money, doesn't have an account, is not able to borrow money. But if he can lease a car, then he can earn money. So what we do is we lease the vehicle to the driver, and he pays back on a weekly basis. Asset management business. I think asset management business is quite promising. I said that it exceeded 5 trillion yen. We want to be 10 trillion as quickly as possible. I've been instructing that to my junior, and they say that they can't do that. And the reason is the sophistication and sophistication of securities management at the regional financial institutions. And there's a demand to outsource that. There's about $132 trillion in the bonds of managing securities at regional financial institutions, along with yen bonds is $83.9 trillion. Which means that when you say $83.9 trillion yen, Nearly 64% is yen bonds. And on top of that, by 2022, about 40%, so that's about 15 trillion of government bonds and local bonds held by regional financial institutions will be redeemed, which means that each year profitability will decline. Meanwhile, regional banks lack resources that are capable to deal with global asset allocation. And if you look at deposit loan gap, so at $116 trillion at regional banks, credit union is $81 trillion. So together, it's $200 trillion in deposit loan gap. If you look at this, this is all our potential market. In fact, if you look at the yield, if you look at lending margin, it's 1.85. This is exceeding the yield on... I'm sorry, the yield on securities is 1.18. This is above the lending margin. So it's better to manage it on securities. But this is, looking on the trend, it's all declining. And that's the key. That is why we need to continue to entrust from the regional financial institutions. So today, among 99 regional financial institutions, 58.6%. So 58 financial institutions are entrusting to us. 58, not 8. Capital, business, partnership, whether we have that partnership or not, it's regardless.