Sbi Holdings Inc Ord

Please allow me to speak to you without my mask on. Thank you very much for attending today despite your busy schedules and the weather getting a bit colder. Without further ado. I would like to explain the first half fiscal year 2022 concern like they did financial results. The numbers have already been announced, but revenue increased 40.7% year on year to 417.2 billion yen, which was historical high for first half period. The largest contributor was the financial services business. It has experienced a 81.3% year-on-year increase to 403.1 billion yen. So this performance has contributed largely. Profit before income tax expense in the financial service business increased 18% year-on-year to 69.6 billion yen. This is the basis for determining the amount of a shareholder return and the profit before income tax expense was very strong. Therefore, the interim dividend for the fiscal year ending March 31st, 2023, is going to be 30 yen per share as the previous year. As for the consolidated profit before income tax expenses, financial service business performed well. However, in the investment business, the listed company in Vietnam, Taping Bank, we do have the equity ratio of 19.9%. And with a 20% and above, we want to make this company an equity method subsidiary. If that is so, the short-term business performance change caused by the market turmoil can be avoided. However, due to the Vietnamese law, we were not able to do that. Therefore, of course, we have been doing a lot of negotiations behind the scenes, and the foreign-affiliated percentage opened up to 20 percent, and we were able to negotiate to that point. However, TP Bank that holds our shares wanted to make this IFRS eligible, which is going to take quite a bit of time. Therefore, with the large drop in the price, we had to accept that as it is. With just this one listed company, we have experienced a large loss. And it says due to the overseas listed stock price declining in total, there was a value loss of approximately 31.4 billion yen. But out of that, 28 billion was TB Bank. But this was the value loss. And the performance of TB Bank itself is quite strong. And, of course, our ratio, we want to increase it more, and we have no intention on selling it at all, their shares, in addition to TB Bank, the crypto asset business. The first half accumulated basis probably for income tax expenses was 12.8 with the mining business was 7 billion and B2C2 business which is the cryptocurrency marketing business has posted a loss, and those two are the major regions. So within three or four companies, they have experienced a large loss. So as a result, the apparent profit attributable to the owners of the company has declined about 90% to $7.9 billion. The TB Bank, that we are making a direct investment, the fair value loss, this first half was $24.8 billion. And the company that investments is large, which is a crypto asset business, subsidiary company, their posted loss was large. So the subsidiary company lost. So the tax... wise, the amount of favorable tax measures was small. And so saving five basis for four stocks has declined. So in what is happening in the United States, we were able to foresee that the stock market, something would happen in the stock market. But other than that, we have been doing various measures. But despite those factors, the financial service business was still performing strong, so we were able to keep this IFRS basis, a consolidated basis, between April and June. The July and September have shown a large improvement. The reason why we are performing strong is because when we do an Apple to Apple comparison, we compared ourselves with Nomura Holdings, Diver Securities Group, SMBC, NICO, Mitsubishi UFJ Securities Holdings, and Mizuho Securities. When we compare ourselves with them, Despite the last net profit, what is most important is profit before income tax expenses. At that level, how are we performing? We are performing the best. When we look at the quarter basis of comparison, the revenue and the profit for income tax expenses are listed here. Nomura Holdings compared the first quarter, the second quarter, they have made a large improvement. they have slightly higher profit-before-income tax expenses. Daiwa Securities is slightly lower. SMBC, they had various things, so they're making a loss. And compared to Mitsubishi UFJ Securities, we are far better, as well as far better with Mizuho Securities. So looking at the Everlearn comparison, we are competing very well, performing quite steadily.

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As the steady growth area, which is a financial service business, was performing this way. The reason why I have changed the basic way of thinking regarding the business segments is because At the end of last fiscal year, the first quarter, Mr. Katsuki was explaining. In the interim period, I was going to give the explanation. I will do the interim and the fiscal year end only. And the important end of last fiscal year, I did say that I'm going to change the segment classification. The reason being is because I predicted that there will be a large increase in the interest rate and the market itself is largely fluctuate. Therefore, the business segments that generate relatively stable profit, and those that are highly dependent on the market environment and have large performance volatility, and those that are advanced and expected to grow in the future. or a market that's not advanced, or the uncultivated market that we have not entered, the remaining land untouched, all that together we wanted to classify it as the non-financial businesses. And as I have assumed changing this market segment classification, for the investors, it became easier to understand. And as for the management, it has become easier to understand as well. Where we need to focus the most Whatever the environment is, the business segments that generate relatively stable profits, we need to create a structure where we can generate stable profits. Of course, we are a business in making investments, so there are ups and downs. Because if we didn't want to do that, all we have to do is not get involved in that business. And when we think about the future growth, Web 3.0, I did write this in my blog. We cannot ignore this business area. Currently, there's a turmoil occurring in the market. But even though with that situation, if we don't start now, we are going to fall behind the competitors. That is why we are doing it now. Of course, we do understand there will be a loss. The Web 3.0 basic technology is blockchain and non-fungible tokens, NFTs. So these type of domains and DLT, distributed and autonomous organization, the DAO area, these three areas is something that is going to comprise Web 3.0 is my thinking. So within all these elements, though we do have a certain level of the business and investments already made in these I have mentioned by segment sales, sales are 81.3% and year-on-year difference, well, it has grown by 18%. We have landed in this result. An asset management business is an asset management, so of course it's going to be impacted by the market slightly. However, compared to the investment business, it's quite stable. Highest volatility occurs in investment business and crypto asset business, followed by the online financial business. This is the revenue by segment for the first quarter and second quarter. You will see that investment business and crypto asset business under such circumstances will be impacted. That goes for the profit before income tax expense as well. Regarding the dividend, as I have been mentioning from before, in the financial service business, we will aim for about 30% of the profit before income tax expense. Therefore, it is going to be 30 yen. We will be officially making that decision at the appropriate timing. A business overview of the core businesses, financial services businesses, as I have mentioned before. And what are the major constituent companies, SBI securities, SBI liquidity market, SBI FX trade, SBI money plaza, PTS operating companies? Those are included in the securities of business. And how was SBI securities performance? This is under JGAP. It has resulted in this. Within the current market situation, I think they are performing quite well compared to our competitors. For FX, the higher the market volatility comes, it will be making more profit. So under this situation, they have resulted in the record high, which is a 27.8% increase year-on-year. And as for the security subsidiaries in Thailand and Cambodia, as a business, it's performing well. And the first half, Thai Online, the profit for income tax expense was above $200 million, and for Cambodia's Royal Securities. at the profit before tax income tax expenses were 29 million. It is a small amount but it is steadily performing and the market size in these countries are small. And what about banking business? It is under the financial service business as well. When I spoke to you last time, the management resources that we have for foreseeable future We will be focusing on the banking business and non-banking, excuse me, the banking business and non-banking business. So what happens to the banking business? Shinsei Bank Group. This is JGAP. IFRS, it was about $26 billion. To begin with, our financial results became today, and as for today, it will be after 3 p.m. The reason being is because of the Shenzhen Bank. Shenzhen Bank, because they are lagging, we are ready from a long time ago, but we have to incorporate their results, and that's where it was taking time to make this announcement. fundamentally need to change their system, and we need to make improvements that they will be able to make the financial results announcement quicker. That is just the first step at the entrance. A company that cannot do that can't say to another company, if you have to do FX. They have to make improvements as such, and as soon as possible, being able to submit the financial results. Because of them, in various areas, we are negatively being impacted. But put that aside, their performance is in line as planned. Ordinary business profit, $41,528,000,000, 24.2% year-on-year. Profit before income tax and expense, $30,544,000,000, 14.1% increase year-on-year. Profit attributable to owners of the company was $24,895,000,000, plus 7.2% year-on-year. At IFRS, we cannot get a fee up front. We have to level it. So the marketable securities, IFRS, is valued in market value. Therefore, if you convert it in IFRS, it will be more strict and a severe result will come out. The megabanks in total lost 4 trillion yen on bonds. If we can offset that type of a loss under IFRS, we'll be real estate only. But the world is now incorporating IFRS, and if we are going to be playing at the same global arena, we need to change it to IFRS as well. Shinsei Bank, as Mr. Kawashima went over there, this transaction balance... was $4.3 trillion. Compared to Mr. Kudo's leadership, how much has improved? We have improved to a degree that we are able to open up a regional bank in terms of deposit. It has exceeded $9 trillion. Well, the loan-to-deposit ratio exceeded about 80% to begin with, compared to the other regional banks at the level of 60%. They're increasing the deposit, and they should increase the deposit more and more and provide loans more and more. But even though they increase the loans, they have to find... the good loan deals. And Kawashima-san will have to put his utmost effort to find such. And the reason why we are acquiring non-banks is related to this part as well. SBI's Mission Net Bank and IFRS basis showed a 70 percent decline. Only 1.3 billion. However, based on the JGAP standards, 35.8 percent increase year-on-year and 14.3 billion. So IFRS and JGAP, the numbers that will be generated are totally different. Because such things happen, it's difficult to make the financial results announcements. But SBI, Sumishin NetBanks, as our subsidiary company, we have 50 percent investment. And Sumishin has a 50%, so it's a 50-50 joint venture. Therefore, the system is created in a way that can be done quickly. So this is the part thing that is asked for Shinsei Bank to do as well. This number of counts and balance of deposits is steadily increasing. Of course, it does not reach Shinsei Bank's 9 trillion, but it has increased to a level of 7.5 trillion. and the account number of $5.73 million. Shenzhen Bank, moving forward, the issue that needs to be tackled, they need to find prime loan deals. SBI's Mission Net Bank, their largest issue to tackle is its neobank initiatives. They need to bring this to a profit-generating business. At the first half, they have achieved profitability. And the BAS, Bank as a Service, in BAS area, JAL Nail Bank, T-Nail Bank, Yamada Nail Bank, Ochi Bank, Takashimaya Nail Bank, Daiichi Life Insurance and Matsui Securities under the NIO Bank concept, they are heading towards implementing such initiatives. So by generating such results, the Challenger Bank and NIO Bank existing quite unique and aligned with the age bank will be born. And if we want to further evolve this, we need to make this into a digital bank. SBI Savings Bank in South Korea. Marketable securities, they have quite an amount of marketable securities. Therefore, when the stock market goes down, they are impacted negatively in terms of their performance, and the interest margin will shrink. But they are at a high level to begin with, so it's not shrinking at a surprising level. But the stocks that are held by them, the stock price are declining or is impacting them. But IFRS basis, a year-on-year basis, they do have approximately 14.7 billion of a profit before income tax expense. And their total asset has become 10 trillion 229.6 billion won, 1 trillion 66.9 billion yen, and improved their performance this way and have made this bank into the most profit-making savings bank in Korea. And the bank in Russia, SBI Bank, We have shrunk the size in terms of the business size so that we will not be impacted. And in Cambodia, SBI, Liho Bank, two consecutive fiscal years. It is sure that they will have a full-year profit. And the profit before income tax expenses as of the third quarter end of 2022 is 522 million yen. Insurance business, SBI Insurance Group, SBI Insurance, SBI Life Insurance, small amount short-term insurance companies steadily. The consolidated revenue of first half was increased by 9.3% year-on-year to $47,897,000,000. And as for the policies, KGAR, 15.3%.

asset management business. The core consistent company is Morning Japan, and the revenue steadily grew. However, because of the deterioration in the market of stocks and bonds, there was the 31.3 percent down by about 600 million yen. Therefore, we believe that we can recoup on that soon. And the Shinsei Invest management, which Morning Star Japan made a wholly owned subsidiary, From October 2022, its performance will be incorporated in the business results of asset management business. Morningstar has become very slim, lean in terms of organization, and there will be integration of the management resources such as system, data, and personnel to improve operational efficiency and profitability, to strengthen risk management as well as compliance systems, Morningstar Group has been increasing the AUM steadily, approaching almost 4.5 trillion yen. And mainly the institutional investors, mainly the regional financial institutions, have leapt to 166.5 billion yen. And the investment business, which is a problematic business, revenue was down 63.1 percent from a year earlier. The issue here is the fluctuations of the fair value variation, among which the problem was in the variation of the listed companies, although there was little impact on the unlisted companies. And TP Bank in Vietnam, the VN index in Vietnam market has been down significantly. This is the index of the market there. particularly in the financial sector. There was a sharp drop in October. On the 17th of October, on the 17th of October, if I remember correctly, the top five, the fifth-ranked bank experienced a run on its bank, Saigon Commercial Bank. That is the name of the bank. There was the run on the bank accounts at that time. The reason why there was the run was because of the fraudulent act by the real estate dealer. I don't know about their truth, the credibility of that information. Anyway, the stock prices were down. That has dragged down the TP Bank share price significantly. However... after the announcement, the financial results. And then by the end of the third quarter this year, almost the results was almost the same level as last year's. And also, they have come up with the sound budget for the full year as well. And the investees, the companies, IMO and M&A's track record is here, and 35 is expected to be done for the full-year forecast, which will exceed 22 during the fiscal year 2021. So we can say that the IPO and M&As are being conducted steadily. But the issue here is the valuation. Sadly and unfortunately, underwriters are not able to give proper valuation. They are scared, offering 30 percent discount. And further, they are not able to willingly take that deal, and they would like to see further decline in the valuation. I think this is the big problem in securities companies. by giving such pricing, and then issuers will not follow them, and then over 100 billion yen market cap expected for any companies which may go for the direct listing. So why do they have to offer 30 percent discount, and the foreigners are not interested in this, and they are not coming to show up in the appointments? They're offering a further discount. Why do they have to do that? Why do we so flattering to foreign investors given this weaker yen? Don't you think so? I don't think there is any reason in this. There is no any excuse for doing this. So I have to fight against this because there is the problem in the valuation and the pricing. And JFTC, I would like to file a suit with JFTC for these dealings regarding our pricing as well. We need to seek proper... way in offering variation and pricing. That's what we have to do. Then I believe that naturally customers will follow us and approach us. In the past, when I used to work for SoftBank, for the first time in Japan, The corporate straight bond issuance in the amount of 50 billion yen was conducted without having the manager for that. And then there was the syndicated group of Japanese banks. The Banking Bureau of the MOF opposed that movement very strongly, against which this first ever of the agency method of this straight bond issuance was carried out. And going forward in this area, this new corporate or wholesale area, we'd like to bring about the tremendous transformation of the market going forward. This is about the leasing service and listed now on the gross market of TSE. And this is going to be exceeding the IPO price and the crypto assets, as I said earlier, at 12.8 billion yen and B2C to 4 billion yen and mining business, 7 billion yen. And during the first quarter, the hedging company in Singapore went bankrupt. So because of that, I have been very strict in managing this business. Therefore, regarding the problematic companies you may have heard, have not caused any nuisance, inconvenience to the customers, and these are all minor to our business. Given this trend, we have been carrying out new things one after another, new things that cannot be done by any other companies. Then in the meantime, we'll be the first in exceeding other companies in offering such new services. So staking service, crypto asset, just holding the crypto asset contributes to the maintenance of the blockchain and generate rewards. So there is no need for application. This is the unique system for crypto assets. This is being done. And also for new crypto assets, Avalanche and Polygon, two new types of crypto assets have been started in dealing. And the total number of the crypto assets will be 14. So SBI VC trade is going to be the number one. a company in crypto asset dealing company and midpoint, Bitpoint was acquired. Because of that, SBI Group, the number of customers in SBI Group's crypto asset business has increased by 7.8 folds compared to the year earlier. And B2C too. Where is the needs? Simply said, in the market, As the market maker, we are not able to just offer services as market maker. CME, Chicago Market Tile Exchange in the United States, according to CME Group, many institutional investors prefer futures and options trading as a risk hedge to the crypto asset market. Therefore, futures and options have to be done, carried out thoroughly. So that's the way we have headed for. Well, we are sure that that is the trend going forward when market becomes volatile like today. And then there is increasing needs for hedging. For doing so, options and futures have to be offered. In fact, in CME groups, a crypto asset related products The trend of the large open interest holders is increasing, and B2C2, trying to capture such demand, is now coming up with new services and products. Cryptoasset NODF was done for the first time in the world. and also for the sound development of the crypto assets and futures and options. They are trying their best for doing so. And biohealth, biotech, a la business, both are growing steadily. Biotech as well. Preparation for being listed will be conducted smoothly. And phase two are ongoing. There are four or five phase two trials ongoing only with Biola Bio as well. And also has licensed in our product and candidate and as well. And this is about phase one. This is preclinical. Corona Bioscience Phase 1 study is ongoing, so we are steadily producing new products or candidates. We are not capturing them in-house. We are licensing out technologies. I believe that this is the right way to do so, because it will cost us huge amount of money. So I think this is the desirable way to pursue. Five other. Already, we are seeing three Phase 3, 4, bladder cancer, breast cancer, and meningioma, and PDT. For those patients who are taking ALA and then the photodynamic therapy will be emitted in order to kill cancer cell. German University of Münster and LMU Munich and Oxford University photodynamic phase 2. are underway. And also at the Oxford University, the cardiac ischemia reperfusion injury is the target disease when the ALA is taken by the patient. And then once there will be the clotting of the blood, and then once the blood is reperfused, and then the reperfused blood will move to make the, move the clot to the brain vessel. So that will happen. You can relax. Alaplastowdown drink. Drink was also developed. This is selling very well. At Ito Yokado Naseiyu, these supermarkets are regarded as the main channel. It is very easy to drink. that's what we have heard from the market many people like to take other but it is in the capsule formulation therefore there are elderly people who are not able to swallow so this is in solution type and milligram volume is a little smaller than other formulation but you can take some So in that sense, it is very good. And SBI art auction, art auction-related business, this has been growing steadily, mainly in contemporary art dealings. For the first time, non-fungible token is utilized for the digital art auction being held. So in the digital area, we are making the inroad into this market as well. So centering on the core of the financial business market, we are going beyond the financial. We are fully incorporating Sinsei Bank into the group's overall strategy to ensure business operations toward integration. We are promoting the unity of the SBI and the Shinsei Bank Group, and secondly, thoroughly pursuing business synergies with Shinsei Bank Group. And thirdly, we are taking initiatives to further strengthen the triangle strategy promoted by the SBI Group, Shinsei Bank Group, and further regional financial institutions. in strengthening non-bank areas through M&A and various other measures. There are four strategies. There are other strategies or initiatives, but I'd like to take this opportunity to explain these four for today. In promoting the unification of the SBI and the Shinsaibank Group, reorganization and personal exchange, on the October 11th, SBI Regional Bank Holdings received approval from FFCA to become a bank holding company under Article 52 of the Banking Act. So for us, we have acquired the shares, and our voting right ratio became 50.05 percent. So literally speaking, in name and substance, SBI Holdings has become the parent company of Shinsei Bank. on the january 4th 2023 since a bank will change its name to trade name to sbi since a bank on january 4th 2023 we will visit there to commemorate that change of the name the organization between SBI and the Shinsei Bank Group. First, Morningstar will become the subsidiary of the Shinsei Investment Management. Shinsei Investment Management, this is the subsidiary of Shinsei Bank. So Morningstar will become – has become the subsidiary of Shinsei Investment Management. This means that the asset class, which can be offered by SBI Group, can be expanded. So SBI – Shinsei Investment Management has been dealing in active fund of funds. So in active arena, we have been able to add further lineup of new products. Now, securities. Shinsei Shoken used to be existent as the alliance partner of Manex. So in principle, with Shinsei Bank itself and SBI Securities, They have received the transfer of the business of Shinsei Securities, and the remainder of the business will be discontinued, and the Shinsei Securities will close, will be closed. Between the two groups, we are promoting various measures to enhance group-wide unification and improve back-office efficiency. So Shinsei Business Service, which is existent within the Shinsei Bank Group and SBI Group, has invested and obtained 40 percent of stake. making it a joint venture and a cost reduction through bulk purchasing of equipment or labor saving and productivity improvement in general affairs-related operations are being done. And personnel exchange. From SBI Group to Shinsei Bank Group, five companies, 22 employees are now sent on secondment, and 91 employees participated in Shinsei Bank's training program. On the contrary, from Shinsei Bank Group to SBI Group, seven companies, 25 employees are on secondment, and 58 employees participated in SBI Group training programs. So personnel exchange is being activated in order to enhance unification between the two groups. Next, we are thoroughly pursuing business synergies with Shinsei Bank Group, SBI Securities and Shinsei Bank, the financial instruments, the intermediary and banking agency services, and we are promoting the collaboration going forward. In August, the 2022 SBA Securities and Shinsaibank launched the Financial Instruments Intermediary and Banking Agency services. In September 2022, APLAS of Shinsaib Group launched an investment trust accumulation service using credit cards provided by APLAS. In October 2022, the FOREO, our SBA Group company, launched the SBA WRAP. multiplied by Shinsaibank, developed and provided by Folio. So we are intending to grow by expanding their customer basis through mutual customer transfers, expanding their product line and providing highly convenient services.

Furthermore, Manin Plaza have established joint branches both in Ikebukuro and Umeda. So the business has started. And also, there's a triangle strategy promoted by SBI Group, Shinsei Bank Group, and regional financial institutions. And we have initiatives to further strengthen this strategy. So with Shinsei Bank joining in the force, our relationship between regional financial institutions have become even stronger than before. The other day, we had Jukkokai. So these are the banks, the regional banks, nine of them, which we either have some sort of partnership or capital affiliations with. The heads have come together, maybe, and also the management have come together, 50 or so. These are like heads of the branches, the banks. business departments as well as, of course, the presidents and management. And we have come together and shared experiences such as best practices and successful cases so that we can share that information with each other. Rather than us saying do this or that, I think it's more persuasive if the regional banks who have already been successful with their support share that information. And that would then... we would be able to demonstrate our next step for the next generation. So with Shinsei Bank joining in, this triangle strategy has become stronger from before. So up until now, it was just an introduction since the bank originated services and products being introduced. So it's not just that, but regional banks are now carrying out customer referrals as well as arranging syndicated loans and coordinated loans as well. So the structure of finance, know-how that Shinzo Bank has, we will combine that with regional financial institutions network in front, and we will be able to build new business, and even with the corporate business, we will be able to provide tailor-made financing to venture companies with high growth aspirations and needs. The deposit balance has increased to 9 trillion yen. So how are we going to make sure that we're able to get spread on that? How are we going to invest in it, manage it? And this is probably the key to improving the profitability of Shinsei Bank. And then utilization of Bankit by Uplus. So we have revamped this over and over, and now we have white label plant, embedded plant. So this is for, you know, where the new developments are required. It's for those plants. And for the regional operators on the right-hand side, an embedded plan is for the ones who want to build it already having their private apps. And now we have sales expansion of BankIt targeting local companies. So reducing the need for point cards, it contributes to expanding app users, promoting sales, and attracting young users. So we will offer white labels. And this is how we will continue to target the new local companies. Now, if you look at the operating assets of balance at Atlas, we are encouraging them to continue to increase this. I have met with all the executive officers of Shenzhen Bank, all 40 of them maybe. We were eating Chinese, maybe 10 of them at a time together. We were dining together and we would talk together. I would share my information. So I want to go one layer of age group younger so that I can talk to the younger generation. So in this way, we will be able to communicate. They will be able to understand the way of my thinking So without communication and changing the mindset, there will be no transformation. I will never forget Suzuki-san from 7-Eleven. Every week, he would gather together the franchisees and he would talk with them very energetically. That's what built 7-Eleven. Suzuki-san's energy, his passion, that have built 7-Eleven. And we will strengthen non-bank areas through a mandate and other various measures. So it used to be SBI mortgage, but ARHI was doing a housing mortgage as a bank, and they have made that decision. And they decided that this will be their source of investment management. So I decided that we will shift home loans to ARHI. And for Shinsei Bank and for regional financial institutions, buying this back would be very positive. So I decided that even after I sold off, he decided to buy this back again. It was voting rights of 51%. And we had actually more, but we had to do provider allocation. If we did that, unfortunately, those people who were not able to sell it would have to sell it in the market. And, of course, that would cause lower valuations. So that's what we did. And if you look at operating assets balance, I should say financial, we will continue to increase this balance as well. So we have 35.3 or 35.34 million customer base. Shinsei Bank has 8.5 million. So together, we have nearly like 45 million in customer base. And up until now, it was SBI giving, giving, giving to Shinsei Bank. But now, going forward, we would have Shinsei Bank group contribute to SBI. We need to be compensated, commensurated for this And for the first time, we will be able to have a win-win relationship. We have sacrificed many things. In order to meet this big just cause of paying down 35 million yen that Shinsei Bank had in debt, we have made all these sacrifices. And of course, we contributed to their performance improvement. It's not just them also contributing to a performance, but they also about how they can contribute to all the initiatives that we have in place, such as regional revitalization program. So that's really important. And when we start on something new, Shinsei Bank need to put their wisdom together so that we can work together on new things, new initiatives like digital space. So let's work on this together. It has to be mutual. So regional revitalization strategy will now go up to phase two. and measures to further improve profitability of regional financial institutions, the way we can support them. So you can see that interest rates have basically gone up around the world. Only Japan hasn't really gone up. But, of course, the long-term interest rate has gone up slightly. And it's really a matter of time. Kurota-san will be replaced next year. And, of course, you ask him, you know, Do you want to do it again? And he says, no, no, no. I mean, governor is a very challenging position to be in. So if Japan loosens the reins even slightly, interest rate could really soar up and become uncontrollable. What happens is FX will change suddenly from weaker yen to stronger yen. We are in that sort of timing. That is why, like I said at the beginning, we need to clarify what's stable and what's volatile. And whatever is stable, make sure that we foster that. We need to make our utmost effort to make sure we develop what's stable. So you can see that after the expanding of pandemic, we can see increase in the loan deposit gap rate. But now the rate of increase has hit ceiling. And if you look at the domestic loan book, it has fallen by 1.1%. But since normalization have appeared to regional financial institutions, people used to say that it's normal that lending business is not profitable. But this era really has come to an end. This negative interest rate age was not profitable. That's why net asset ratio was like 0.2 times or so. And that's why they were able to buy stocks. But we're coming to an end of that sort of an era. And if that happens, what do we need? Under circumstances like that, we will see increase in business bankruptcies as a pandemic loan repayment starts. So once the government subsidy expires, basically they will not be able to pay back. And even if you look at the default rate from this April, we're beginning to see increased trend. So that is why. What do we need to do? We know. We see it. It's visible to us what we need to do. So with regards to further strengthening capital alliance, in addition to improving profitability and reducing HGN expenses at each affiliated regional financial institutions, SBI Group will actively promote measures to restructure lending operations. We really need to rebuild it. So we need to invest in the businesses if it's necessary. And in fact, we are willing to do so. So in fact, from this December, Based SBI regional bank holdings will plan to underwrite 1.5 billion issuance of preferred shares that will be issued by Shimane Bank in December 2022. This is without voting rights. I think altogether it was 6 billion. But if you look into other regional banks and the local companies... Because they have decided that they will pay the rest. We only needed to underwrite 1.5 billion. That's because Shimane Bank is beginning to revitalize. They were able to turn around. That's why the local entities were willing to assist. But, you know, they can't halt here. So we need to make sure that we monitor them and... they need to rebuild their portfolios, their loan book. With the other financial institutions, As long as they are supported by our board or our executive committee, I would like to be proactive in supporting them. And hopefully, this initiative will be helpful in assisting that endeavor, and that is why we have decided to acquire 33.4% of Keystone Partners' outstanding shares, and we made it the Quintin Method affiliate. And so this sort of initiative, Keystone Partners, their know-how will also be very helpful as well. And with measures to further improve profitability of regional financial institutions. So more than anything else, regional financial institutions really need to switch the system costs from fixed to variable costs. I've been saying this from three years ago since we have announced this big strategy on regional bank rehabilitation. I have been saying they need to change their cost structure and also they need to commonize the system. Why is it that everyone has such a completely different system? Just because the passbooks are different. I have always suggested that they should work on this together. They should commonize. That would significantly reduce the cost. I've been persistently saying this. And finally, they have decided to develop next generation banking system. the first user will be Fukushima Bank and there's another bank that has already expressed that they will adopt this and if they do this it will be profitable and in our plan by 2030 there will be 10 financial institutions so it will be adopted by 10 banks by 2030 and hopefully profitable by 2031 so that's the scheme and if this is realized This is cutting edge using cloud. And Future Architect. This is an amazing company. They are working with us. Their technology is excellent. Hitachi and others have really given up on this kind of technology, but they are working on it, and they have actually made it usable. This is a venture company, but they have such an amazing power strength. And through this, we will be able to levelize the system cost burden throughout the annual fee model. We are now beginning to materialize what I have been saying from three years ago. Now, common ATM service, so we have Fukushima, Sendai, Kira have decided that they will adopt this. And this is Nakano president. He is now the former president. He's now with Social Future. He has made all these different efforts and he made this realizable. Also, as I said earlier, this is primarily face-to-face sales. There's 152 branches in 42 prefectures. I think if you have 152 branches, there's different ways you can leverage this. So they will be able to handle a variety of products owned by Aruhi, including Flat 3. And also about marketable securities investment. I have been saying over and over that they need to replace their portfolio. And... you know, if they realize they can actually improve their profitability through this. And within three and a half years, approximately 3.4 times increase you can see in the amount of assets under management. And if you look at the breakdown, 67 do not have any business alliance or capital alliance with us. And fourthly, So support for further evolution of regional financial institutions business model going to from regional to nationwide. I have also been saying about this from three years ago. The regions are really declining population, decrease industry infrastructure, weakening more and more. And in order to revamp that, you can't just depend on that local. Of course, regions have their network that they have been able to build over many, many years, which they need to value as well. But they have to also look at nationwide, can't just focus locally. So that is why if you look at this... You can see the improving deposit account utilization and attracting younger customers are common issues for all strategic capital and business alliance partners. And you can see declining trend in number of active accounts, new accounts opened and accounts held by customers below 40. And you can see it's been declining since 2019. We have to stop this decline one way or another. Otherwise, the regional institutions, financial institutions will not improve. That's why it's necessary to have Internet and mobile channels with excellent UI and UX. That's why I've been persistent about saying about this. And that's what Shimane Bank has done. They have taken initiatives to expand customer information with this Shimaho smartphone. We recommended and we supported them, and they are able to develop. And that's why they were able to have $6 billion.

The equity ratio is about the 9% that we hold, yes. That's a big deal. Internet banking system for individuals. At normal, we have reached the same level as the regular internet banks. We are able to do such thing. And FIDO authentication is used. So security-wise... is highly reviewed. Next step towards realizing regional revitalization. Two major projects in the intermediate future promote a medium to long-term support for local SMEs by involving each economic entity in the region. This as well, we've been, I have been continuing saying this for over three years. The regions will not be revitalized by just looking at the regional financial institutions or local industries. We have to have the local residents and the local governments be involved. All four need to be revitalized or else it is not going to work, is what I have been saying. In order to do that, the regional revitalization partners, this was the main body that will create policies We have the Yamaguchi Financial Group, DBJ, SBI Holdings, Concordia, Yokohama Bank at the center, Concordia Financial Group. have participated. However, the COVID pandemic occurred, so the external activities were difficult to conduct. However, we have gathered together. We had a board of directors meetings. We had thorough discussions. And we have created two companies, SBI Regional Revitalization Services and SBI Regional Revitalization Investment and Loan. And we also created the SBI Regional Revitalization Banking System, Development of Next Generation Banking System, Management of Related Silent Partnerships. And this Regional Revitalization Services, I served as the President and CEO, but I couldn't take care of all of the businesses that I'm responsible for, so... We had the representative director of change to become as the president. And for the regional revitalization investment and loan, I asked Mr. Yoshimura, the representative director of Midas Capital, to become the non-executive director. And we had long-time discussions. And the two major projects in the immediate future is the Involvement of local businesses and local governments to solve problems such as the regional environment and high electricity prices. From urban waste, produce biomass-derived fuel and generate power with a private power generation that has the high power generation efficiency. The venture company called ERI, they have a system called NECRAS, This is a groundbreaking or epoch-making technology, and we are utilizing that. They have received orders, and they are being referred by the regional banks as well. And also, the private sector projects have been also conducted. We have to do something about these municipal wastes. And actually, you have to have a 10-year contract, and it's very expensive. Lots of new technologies are being developed. But why is it a 10-year contract for such waste disposal? That is because there weren't that many companies that were going to do that. And also, Michino Eki, which is the roadside stores. Europe, U.S., China, all is going to convert into electric vehicles. And in Japan, infrastructure is necessary. We need the recharging stations. The rapid recharging stations are necessary, so we need to make them. So Japan Charging Infrastructure, we made a 53% investment. Right now, there are 244 locations. We are collecting the money as well to increase this number. And this, Michino Eki, The roadside stations were used for just washrooms or restrooms, but that has evolved to become a sightseeing area as well as shopping areas. But moving forward, it is going to become an area that is going to be a base that speeds up regional revitalization and tourism as well as disaster prevention area. Just the solar power is not enough. Unless a very good storage battery comes out. Because the time or the hours that the sun is out is limited. Wind power generation, hydro, electric power generation, we cannot depend on them. So we need to take care of such a situation. That's why we are... getting involved in such initiative. And Dojima Exchange, I would like to enter the emissions trading field. The regions need to generate these kind of things because they do have forests. The urban cities generate CO2. So between the regions and the urban cities, I believe the trading can be done. So I would like this to become a comprehensive directives exchange that ranks among the world's best. Promote medium to long-term support for local SMEs by involving each economic entity in the region. company that I have explained to you. We would like to do that SBI regional revitalization investment and loan. But in addition to that, together with the bank that we are investing, we create a joint fund. And also, fortunately, the Japanese government is actually supporting the investments to SMEs. and creating new special measures to support SMEs or to support the regional SMEs, or training human resources for equity finances, or encouragement of entities that seek to support local SMEs. Well, we are contributing to a level that we would like to receive support as well. And also, FSA... intends to accept the risk weight of unlisted stocks held through specialized investment subsidiaries from the application of the top-up under the new capital adequacy regulations to be introduced for domestic financial institutions. the 400% risk weight will not be applied. Long-term relationship and if it is to turn around a company as a purpose and it does not fall under speculative investment in unlisted stocks, then this 400% risk weight is not applied. So, in these areas, we would like to implement initiatives in various ways. for the purpose of corporate rehabilitation requirements. Investments in unlisted stocks for the purpose of supporting rehabilitation through so-called debt equity spots, swaps. This is also within the scope. So this is a very good thing for us and also investing institutions. So SBI investment is supporting the small to medium enterprises. by utilizing the joint fund. The regional business succession fund, we have started the initial fund, and that was 10.9 billion, and fund number two was formed in 2022 July, target of 30 billion, and the goal of accumulating up to 100 billion. For Shimizu Bank, excuse me, introduced its partner, Hamamatsu Beigoku Inc. This was the first project in the wholesale rice sector. And with Fukushima Bank, the collaboration study introduced a partner, Tobu Corporation Limited, which runs a building maintenance business in Miyagi. And the fund invested in the business in cooperation with ALSOC. And supporting the growth of local companies through joint fund management, Tsukuba SBI Regional Revitalization Fund has already invested in three. Tsukuba City is a science city, so they have quite a good seats. So we are going to support them by investing them. And Toa SBI Customer Support Fund, which was established in 2021, this as well. prevent as much as possible the potential of bank borrowers turning into non-performing loans, and contribute and promote the revitalization of the local businesses. A new project for revitalization of local SMEs through collaboration of SBI Regional Revitalization Investment and Loan and SBI Regional Revitalization Services. I decided on one target. This is SAKE. Sake is the region itself in various regions. They have the sake breweries that is filled with various essences of that region. And I think this is the area that is best for regional revitalization. They are facing successors issues or cannot go overseas. I wonder why that wine, that expensive wine, is sold globally. However, Japanese sake, though it's very tasty... It only can be sold at that cheap price, and the market is limited, and I want to change such situation. But in order to do so, it requires the help of technology. The blockchain technology held by SBI Traceability How would you like to use this support, to support them on the distribution side so this doesn't contribute to rollout overseas? Blockchain and IC tech, by combining the two, this will be, oh, it's an earthquake now. Can you look up the seismic size and intensity? I'm sure it's not a great deal, but just to be prepared. So using the empty bottles of sake, there are counterfeit products out there, so we would like to prevent such ones to come. So once the bottles open, that can be detected through the IC-TAC technology. When, at what time, when, where? can be detected. So such technology is something that we would like to implement as soon as possible. It doesn't have to be limited to sake. It could be for rice, or it can be for fruits as well, because right now all of these are just stolen from Japan. These wonderful Japanese producers, they put their whole effort into their products. It's their blood and flesh. That cannot be taken away. by other countries. And in order to prevent it, we have to use such a technology. Fortunately, it is used in various areas, various measures in cooperation with local companies and local governments. I think this is wonderful. Chairman Sato of Barunibani, this is accommodation facility in Shimane Prefecture. It looks like a cave like this, but The sunset that you can view from here, it is wonderful. What? At Mie Prefecture, it was four on the seismic scale. And in Tokyo, it was three. So this is the image illustration of the accommodation facility. There's a restaurant. And behind this, there's a housing, and in the housing, there's a bit of gardening and farming land, a gardening space. Nothing existed here, but Sato-san had a successful project in Awajishima, but he'll be working on this and making it a major sightseeing spot. They have the Izumo Shrine in Shimane Prefecture. And in November, in Japanese, it's Kamiyarizuki, meaning that Yao Yorozu no God, 800 of those gods gather to the shrine. And so it is the most popular probably sightseeing spot at this time. But this area does not have a sufficient level of accommodations. The food is great, but not a sufficient amount of accommodations. So by creating such facility, the overall region will be revitalized and will contribute to the increase of the regional bank's revenue. Izumo Attractive. This is a company that was co-established with the local companies. Now in 44 regions nationwide. This is a blockchain using Corda Enterprises platform. This is interesting too. This is a company version of the FURUSATO taxation. They can get a maximum 90% of tax deduction. 21 local governments and 11 local financial institutions are collaborating and looking for taxpaying corporations. And we have this RCAG regional company groups holds various patents and started their activities, and we are supporting them as well. This idea and concept is quite interesting. So number three, which is an important subject, status of SBI securities efforts to implement neo-securities initiatives. So the conclusion first, next fiscal year, In the first half, as for myself, what I have been telling you until now, the domestic stock exchange that is done online, the transaction fee, which the investors are paying right now, we would like to make it free of charge. I think from the age of 25 and above, it's free of charge, though we have been decreasing the price. But we would like to make it all at once zero at this timing. And in order to do so, for the last three years, we have been preparing in various areas. I will explain one by one. NEO Securities Initiative and SBI Security has steadily progressed towards its realization during the first half of fiscal year 2023. Further decrease the ratio of domestic stock brokerage commissions as revenue from online trading. For example... Real estate finance business, SBI Money Plaza, enhances sales of real estate small lot beneficiary interests. From 2020, I said stop doing the structured bonds. And in January, I made that announcement. And as a group total, we stopped doing that. We were the first to do such. So what are we going to generate revenue from was asked to me. So I said do the real estate small lots businesses. Mr. Takamura moved actively, and right now with $18.72 billion is the revenue, and we will be increasing it more. Real estate small lot beneficiary interests are products for receiving income from real estate, for rental income and proceeds from the sales in proportion to the number of units held. They can be invested in starting at 10 million yen, 5 million yen units for prime sites within Greater Tokyo. Expanding aspects of real estate development for fundraising. In 2022, September, acquirers of the Global Corp. which operates a condominium business for sale and an income-producing property business, including rental condominium and offices in the Tokyo metropolitan area. We have acquired 51.95% of the voting rights. So through that, the real estate small lot beneficiary interest products and also the security tokens backed by real estate, we would like to issue this from here. and bring it to the Osaka Digital Exchange. So the distribution will start from here. I want to create a structure as such. The REIT that we'll be focusing on moving forward. The company that will be managing REIT, we have acquired such company. and strengthen real estate asset management. We acquired the share of Tozai Asset Management Company as well. And through this, the real estate asset management business is going to largely expand. So it will be both the private place and publicly offered. And through this, we will surely expand. This is a real estate asset management business. And this non-flow business as well, as explained before, we have the support of the government. And also what the government is saying right now is to double, doubling plan for assets. As long as such plan exists, the main product will be investment trust, a product. So basically it's going to continue to increase. Looking at the current situation, the quarterly balance is the record high, and the investment trust fee is the year-on-year basis increased by 13.4%.

With Sumitomo Mitsui card, we have the credit card through tie-up with them for investment funds accumulation service from June 2021 up until September this year. Since the inception of the service, the total amount of accumulated funds exceeded 13 billion yen and 380,000 accounts have been opened with us. So this was the win-win tie-up. The fully automated AI investment is very well received and the applied amount exceeded 20 billion yen in just seven months. FX business trading revenue becomes one of the pillars of revenue by strengthening of FX business. So, For FY21-22, first half are compared apple to apple, almost the same. In the domestic, the SBI group has the largest total number of accounts and the customer margin deposit in the industry. Although the GMO group has significantly increased because of the acquisition, but the number of accounts is totally different from us. And also the customer margin deposit, we are number one. SBA securities FX revenue alone exceeds the total revenue of each online securities companies. Rakuten is here. Trend of SBA securities foreign stock trading value and revenue is shown here. Foreign stock trading value increased by 6.8 folds and revenue increased by 5.8 folds. Corporate bonds. Business enhancement. Over the six months under review, the number of bills was 37,000. So all of these, we have been participating as the underwriter or others. And there's therefore 100% the underwriting engagement rate and six appeals and the utilities, the corporate bond, including the 24 projects, including Tohoku Electric Power Company. Customers and these companies are approaching to us in order to have us as the underwriter. So as a result of this... Now, operating revenue, the ratio of domestic stock brokerage commission from online trading, which is subject to the commission-free system, is now decreased to 12.3% of operating revenues. Therefore, I believe that this is satisfactory. So that's why we have made the decision to do this business. We thought that we could have 5% or so. Not so low as 5%, not reaching that level, we believe that we will be able to make it feasible. We have the favorable situation for the implementation of neo-securities initiative that is led by successfully established the dominant position in the industries through customer-centric principles and diversification of revenue sources. Now comparing the first half of the FY21 and 22 SBA securities, normal securities, And Nomura Retail is now collapsing. Daiwa Securities are making loss. SMBC Nikko Securities, unfortunately, there were some events. Therefore, that's why they have this result. They're comparing with online. Domestic Securities, SBI Securities, Rakuten Matsui, Rakuten is saying that they are increasing the number of accounts, but their operating income is 86,053,000. The net income is 57,015,050,023. These large securities and second-tier, mid-tier securities share of individual stock trading value. For SBI Groups, our share exceeded 45% and further expanding the share now. SBI Securities has established the largest number of accounts in the industry, 9,187,000. Per annum, CAGR is 12.5%. From the end of the fiscal year ending in March 2009 until the end of September 2022, Nomura increased by 1.4%. SBI Group customer base, by having the Shinsaibank Group, now just under $44 million. I am saying that we have to reduce the commission fees to zero. We thought that this can be viable. Now, SPI securities, once customers open accounts in this company and then they can have FX and margin trading and foreign stocks trading or FX trading or SPI, within SPI securities, customers will be able to establish new trading opportunities. If all these elements are the best in the industry, if they have the dealings with us, and then they don't have to go out of our group. By utilizing Big Data, utilizing other companies within our group, as you can see here at the bottom, we are able to refer customers to other group companies. So making the commission to zero, that is the significance. The rubies and the charts have made their commission rate to zero. Well, that's only what they say. Robinhood is saying that they are doing their cryptocurrencies. But what about their performance today? Liquidity has been concentrated at market maker and they are receiving money from them. They have been doing that business model so far. And liquidity was used for receiving kickbacks. We are not allowed to do that under the Japanese law and regulation here. So that's why we came up with this mechanism. And ecosystem, we have created the strings of our ecosystem. Whole SBI Group focus on NISA and IDECO as strategic products. I believe that these NISA and IDECO, when these were initiated, I thought that these should be positioned as strategic products. That's what I have kept saying. Under former Prime Minister Suga, these products were created under the administration of Prime Minister Abe. NISA and IDECO both were developed and created. Since then, I have been saying that these can be strategic products for us. So I thought that the steady progress needs to be made, and we have done so. And now the government has come up with the plan to double the asset-based income. NISA IRECO system will be enhanced and will be made permanent. So it is too slow. When the ISA was started in the U.K., when do you think it was started? Think about it. With Big Bang, which initiated in Japan was under the administration of Ryutaro Hashimoto. In the United States, that took place 20 years earlier. And compared to the UK, the big bang started 10 years later. So why have we been so late? But one thing that we are able to evaluate is because of the incident of the Mt. Gox in a cryptocurrency, it was quick for the government to come up with the regulation in crypto assets. Coin check incident occurred. And after that, there were many... self-voluntary regulation bodies were created. So there were unfortunate incidents a lot. That's why that speeded up the government's move. From now on, because of the FTX, the United States will start to move, and the UK as well. Anyhow, what is most important here is making this NISA system permanent For us, the trend of Denisa counts. Three million. Nomura and Daiwa are here. not reaching 1.5 million. So while there was a decline at the nominal securities from March 2022 for SBI and the diver securities from fiscal year 2022 deemed the discounted pounds are excluded from the statistical data. and the new customers of the SBA securities, 79.8% was new customers, out of which 73.4% are beginner investors. So 59% of them are the unexperienced investors, junior NISA, and then accounting for approximately 30% of the entire securities industries. SBI is trying to expand the IDECO further. And May 19th of 2017, now Administrative V for IDECO became completely free of charge. This is the per annum growth rate. CAGR is 43.4%. SBI benefit systems subscribers are increasing. 751,000. Please look at this CAGR, 401K. This is because these are regarded as the strategic products. Therefore, we have to put our utmost focus on these areas with high growth rate. This is the area where we have to put much focus on. We are not able to complain that the commission rate is too low, but are there any other ways for us to do our business? The cumulative number of individual defined contribution plan customers, we are the industry leader. Company A, Tokyo Marine. In October 2018, we exceeded them, and now the company B Rakuten has exceeded and overtook, and SBI has continued to be the top company. Going forward, SBI continues to lead the further change in the securities industry. As regards to the future... The other day, Ed of Seaboy shook hands and Seaboy acquired Chinex. And at that time, Seaboy Japan Limited, CBOE, CBOE is world-leading PTS operating company all around the world. They have presence with them. Chairman of CBOE Ed has had a very frank conversation and I have established a very good relationship with him and TSC together with JFSA may have colluded in terms of the resistance over many years. At the Diet, Japanese parliament, many times I had contacted the parliamentarians of Japan. I have visited LDP, not parliamentarian or Diet. I contacted Diet members in order to resist such a petition. Why? Ninety percent of the share is held by one company, TSE. And TSE was overwhelmed by transactions and then came down to zero transactions. There was no alternative market to trading. You never know when we will see such overwhelming transaction surge. So you need to have alternative business. Why? TSE has been a public company, but why can it be continuing to be a monopolistic company, enjoying a lot of benefits of being monopolistic, and everything, all kinds of transactions such as clearing and also the... the transfer of shares are done by TSC and when Prime Minister Suga came into the office and I had a meal with him and I discussed this and I had a discussion with a lot of parliamentarians and now at last we have started to see the movement and it's not sufficient yet and China's It's bought by CBOE. Therefore, together with them, we needed to change this unequal convention or treaty, like the Japan-U.S. friendship and commercial trade, which was uneven, unequal. Thank you very much. and they have utilized fully such benefits and enjoying the very high profitability. It is totally unacceptable. So by all means, as I said earlier, wholesale underwriting, corporate underwriting, and also attitude of securities firms as well. I believe that we need to put much more energy in order to transform the capital market in Japan. So how many – 89 or 90 percent of the market is held by TSC because of that PTS, Osaka Exchange was existent in parallel with TSC. So how much is occupied by New York Stock Exchange in comparison? And I believe that current Japanese situation is in violation of the anti-monopoly law. Osaka Digital Exchange – So PTS was started. As soon as possible, we'd like to take the 10% market based upon which. Now, new products, security token. The market should be created for trading security token. In Singapore, at the same time, we are trying to develop one. And this is going to be global market. Therefore, Singapore and Osaka will be connected and also connection will be made with Europe as well. Such system and also connecting with the US market. We would like to create that. SPI group provides multifaceted support for establishment of SD market. Japan SD Association was established. This is the self-voluntary 13 regular members, 59 guest members, and three supporting members, and 75 members participated. On the right-hand side, SD Research Consortium, which is led by the Mitsubishi UFJ Trust and Banking, in which we have participated, and track record of SD issuance, mainly by SBI securities. We have a track record already established. Mitsubishi UFJ, Trust Banking, Trust and Banking. Progmat is based on Kogmat. We have invested in that, and we have the largest shareholder of the RV, called the system, is used. So what is most accepted in SD is real estate-backed SDs. As I said earlier, we have real estate-related initiatives, and this scheme can be a good match for that. Now, we are actively seeking to increase the balance of assets under management of the group in Japan and overseas based on the business trend, such as falling asset prices and government policies. and synergy within and outside the group, expansion of overseas development areas and focusing on future growth area, we are going to further develop investments. From savings to investment, that is the policy of the government, and also utilizing the organic growth and M&A, we are further expanding assets under management towards 10 trillion yen. Now, investment business. Now, our investment business, we are making ventures all over the world, and we will introduce the technology from then, and whatever usable within our group will be utilized, and then we will diffuse such technologies. So investment, introduction, and diffusion. 1,120 companies invest, 906 companies domestically, and 214 overseas. We plan to establish a new fund to invest mainly in the digital space field, which is expected to grow in the future in the amount of 100 billion yen. SBI Digital Space Fund will be established next fiscal year. As for overseas investment, it is scheduled to utilize global alliances to expand investment in South Asia, like India, the Middle East, and Africa, which the group has still not sufficiently covered.

So that is why we have decided to partner with SC Ventures. We announced this on May 6, 2022. SC Ventures is under standard charters and we have referred some SC Ventures already and we have power to S-M-E-P-T-E-L-T-D. It's called Solve for short. We have made an investment of 9.4%. This is quite an interesting company, actually. Aside from India, they have already expanded to Kenya. They plan to go to Vietnam, Ghana, Malaysia, Bangladesh markets in the future, and they have invited us to go with them. Standard Chartered and our relationship is becoming closer, more intimate. And supporting the innovation of business corporations and alliance through CVC funds. So already we have a total commitment amount of over 118 billion yen. And so we have decided to launch the CVC funds. In the first half of this year, we have newly Panasonic and Paramount Bed CVC will be established. The fund size is 8 billion and 5 billion respectively. And with regards to asset management, under this current trend from savings to investment, everyone... We're all, the government and individuals are now beginning to see that we need to do something about this, that we already see this trend coming in. Of course, because if you look at this, we have retail household financial assets of 2,007 trillion yen. That's a breakdown of cash and deposits at 54.9%. We need to deposit your money, invest in your money in areas where money invested generates more money. And the cost that occurs is enormous. If you look at the United States, it's only 13.7%. Even in the U.K., it's 27.7% in terms of ratio of cash and deposits. Euro averages about 30%, I think, if you could just keep in mind, between 30% to 35% in Europe. So this is how much money is basically dormant. So what about companies? Basically, they're building up on retained earnings. Why don't they invest in growing companies or growing markets or areas? Yes. No wonder Japan's growth rate is slowing down. We always need to go and finance money. Because we have so much to invest in, targets, available targets. To me, it's amazing if you say you don't have anywhere to invest in. Every day, even if I'm reading newspapers or magazines, I get this inspiration. And if I'm looking through, browsing through internet, it's just all inspiring from about 4.30 in the morning because I only sleep about four and a half hours. I basically browse through Internet and I get so many different ideas. I'm thinking we should do this, do that. And my brain is just working full speed. And so from savings to investment, doubling asset-based income plan. The government is calling this out. And Morningstar from early days said, have been offering financial information to the retail investors. We have SBI Asset Management. It's the industry's lowest trust fee rates, and they have worked together with Vanguard to start up with SBI v. S&P 500 Index Fund. And if you look at the monthly net inflow for SBI asset management publicly offered index funds, even in a situation like this, we're getting a nice inflow like this. If you look at the asset management's publicly offered investment trust balance, you can see it's a steady increase. And if you look at public offer index funds, outstanding balance has actually doubled year on year. And while the overall balance of privately placed investment trusts has been declining by 2.4% year on year, you can see that we have actually been increasing by 6.2% increase. And if you look at the top 10 companies in terms of net inflows into private investment trusts, we're in the top 10. Nomura Asset Management isn't in the top 10. I was surprised to actually see this. I didn't find their name. And I'm thinking, well, we're now in the era that's the change in the trend of For someone like me who has worked 21 years ago, this is quite moving. Every time I see this, I keep thinking about this. So, proactively utilize a mandate and other opportunities to achieve our goal of expanding our asset under management to over 10 trillion yen. Okasan Securities Group, we have agreed that we will acquire their shares and we have decided to invest 51 to 49 ratio to Okasan Asset Management. I think we would like to continue to have closer relationship with Okasan Group in different areas. Shinshiba-san and I get along really well, and... He is very proactive. This company is quite unusual in the sense that it's very forward-looking. And we would use, through organic growth and effective use of M&A, we will expand our AUM. If you include Okasan Asset Management, it's already 6.3 trillion yen. When I set out a goal of $5 trillion, everyone thought that was not possible. But actually, I already surpassed that goal. And now we have this new goal of 10 trillion. And Asakura-san doesn't think it's not possible either. He won't say it's easy, but he thinks it's possible too. Because we have the solid strategy in place. And the number will come true. Strategy is everything. And SBI Group will endeavor to be a platform in the digital space domain, and these are the different analyses. I have seven listed here. Now, BTCC in the United States. By the way, this stands for Depository Trust and Clearing Corporation. So this is basically a main infrastructure for financial markets. And in this new equity settlement platform, they have decided to adopt Corda, which is offered by R3, which is an enterprise blockchain. The other day, the top three from R3 came to Japan and I dined with them. And we said to each other, oh, we're so glad. David and I have become personally very good friends as well. And he went back very, very happy and pleased. We are also participating in Mass Project Guardian. Mouse is taking initiatives for asset tokenization, and they are studying the project to study the feasibility of asset tokenization and DeFi to improve the efficiency and liquidity of the wholesale funding market. So it's a project that looks at the feasibility of this. So ourselves, JP Morgan, and DBS from Singapore have participated in this project. So these are the top notch of the world, which we are working together in the project. And the other day we did a test and we were very successful. So if we can be successful and if we can build something very concrete here, we can bring it to Osaka. Because Japan is slow. And I've been saying I will build global financial center in Osaka. Tokyo continues to appeal about Tokyo. And so I keep wondering, if you look at Hong Kong, It's a small place, but even as Hong Kong has become its state as it is today, Japan has not been able to take away its status as a financial center. I'm wondering if Japan doesn't have this intention or will to become the financial center of the world. If it was 10 years ago, I would have had this energy level of more than 10 times today. I would have done much more aggressively. But unfortunately, what can I do today? It's inevitable. There's a subsidiary of Siam Commercial Bank in Thailand. It's called SCB10X. It does a lot of digital initiatives. And they decided to invest in SBI Digital Market, which is based in Singapore. It's our subsidiary. And they have obtained a CMS license from MOSSE. And we are investing in a company called Securitize in the United States, but they will currently building a digital asset insurance and distribution platform in collaboration with Securitize. And then six digital exchange in Asia Next. And by the way, we will work together to invest and establish Asia Next. And we will now be connected to Europe. So everything is becoming global now. Today I got a very interesting email. Saudi Arabia is very much focused, is quite interested in our activity. And many people want to meet with me around the globe. I have many invitations. Germany, about traceability. Düsseldorf, by the way, this is one of the most important German-Japanese network events. Düsseldorf evening. Now Düsseldorf is in Germany, and we have used this technology of blockchain and QR code reading, which we introduced, and we have tried to present the process of brewing beer in Düsseldorf and product information. We sort of brought this subject up to the event. It's not just alcohol. Basically, you can apply this to all different types of things. You can do Unagi Place restaurant in Shimanto area. And so we are planning to release FCI Web3 wallet. In January 2023, basically, they will be solving all the issues of Web3 business that we have faced today. I will not go into details because we don't have a lot of time today. But like I said earlier, Web3 technology, key technology is blockchain and NFT and DAO. Autonomous distributed system. That's the three key factors for Web3. And Token Connect, again, this is for NFT marketplace. It's a service that provides NFT marketplace functionality for content providers. And JungleX. This is another interesting venture company. A company like this, long, long, long ago, when Mr. Song invested and I also invested, in UK there was horse racing. And basically, before the race starts, you purchase the ticket. But here, in this case, you can buy it here and there. So basically we developed it and it almost went public, but we were damaged heavily by effects and so it's no longer there. But in this age, we are able to build something very interesting like that because in the world of digital space, we can do this. Gaming becomes more interesting because if you use token, it will become far more interesting. And we have this content platform, and we will be utilizing Dell Jungle X. Very interesting. It's a company that was started up by a very interesting young man, and we invested in it.