SBI Holdings, Inc.

So this is the announcement of the six-month period financial results. And so it's my turn to talk to you. Actually, for the interim period, I think this is probably going to be the last time for me to present results. So going forward, once a year, I will meet you to present our financial results. That's my plan. And of course, the materials of presentation will be checked rigorously by myself. Based on my own ideas, so please feel reassured. So without further ado, for about two hours from now, or it could be longer than two hours, let me present our results. First, the outline of the results. As you can see, the revenue... 1057.5 billion yen or up 17.2% year-on-year. Pre-tax profit 324.3 billion up 52.9%. Profit for the period 249.1 billion up 52.6%. Profit attributable to owners of the period 230.6 billion yen up 39.1%. The annualized LOE for the first half was 23.2%. This is the comparison of consolidated performance with major securities groups. According to some press reports, We have banking and also, but all the other groups also have those business categories. So please write if you like that the audience would understand that all the businesses are included here. and as you can see between ourselves and Nomura, the pretext, the profit or the other profit for the period attributable to owners or parent are not so different. So the Nomura has more than 100 years of history and ourself has only about 26 years of history. Daiwa Securities Group is lagging behind the performance of SBI Holdings. By segment, this is the first half result, our financial services business is the main driver of the performance. The pre-tax profit for the very first time exceeded 200 billion yen mark. Thank you very much. Thank you very much. Thank you very much. So the current situation will not change so much. So toward the end of the year, we did not present a forecast for the year-end dividend, but here I am presenting 80 yen as year-end dividend. and the annual dividend is 110 yen per share. And this is IPOS-based, the Financial Services Business Performance Development. Here alone, the excluding gain on sale of FOMAS, SPI, Simishi, Net, the bank, the shares. and here the second half of FI 2025 included gain on sale of former SBI submission net bank shares of 141.6 billion yen. So it jumped the number to 306.9 billion yen. As to dividend, basically, especially for the dividend, we are going to make more efforts to increase the shareholders' return at the very strong demand from the shareholders. So we would like to take this policy to increase our dividend. As to SBI Shinsei Bank, from FY2026, introduced interim dividends, paying an interim dividend of 10 yen per share. SBI Leasing Services, Interim dividend of 30 yen per share, up 5 yen. SBI Global Asset Management, year on year, it is increasing the dividend. As to the year-end dividend, the continuing increasing year-end dividend for 18 consecutive years. and SBI Insurance Group at up 12.5 yen, forecast of 59 yen per share. As to segment-wise performance financial services business, as I mentioned earlier, the revenue up 17.3% at 829.7 billion yen, Free tax profit, 200 billion yen, more than 200 billion yen, up 69.7%. Both of them are record highs. The big gun banking business, up 45.8%, exceeding 100 billion yen in the first half. And the securities business, with the 64.8 billion yen, up 90%. Those are the pre-tax, the profit breakdown. And the insurance business, the huge growth rate, well, the size is still small, 18.6 billion yen and up 227.1%. As to banking business... More detailed explanation. The gross operating profit, net operating profit before credit costs, the pre-tax profit on each line numbers hit record highs for SBI Shinsei Bank. And the gross, as you can see here, as to profit attributable to owners of the parent, because of tax issue, these are the results, but there is no problem that we observe here. SBI Shinsei Bank's retail accounts and total deposits. As of the end of March comparison of each year, for 2026, that is for the first half alone, the total amount of deposits and the number of retail accounts exceeded the annual results of the previous years. So it's a very strong result. And in December 2021, they joined SBI Group and they continued to grow SBI Shisei Banks, SBI Hyper Deposit, which is offered with SBI Securities, and both the deposit and the account number are increasing with 1.5 trillion yen. In September 8th, the deposit exceeded 1.5 trillion yen mark, and as to the number of deposit accounts, The 710,000 accounts. And as to the operating asset of SBI Shisei Bank, after December 2021, when they joined the group, the growth has been significant. So at the end of September, with 19.5 trillion yen exceeding annual results of the previous year at 18 trillion yen. Now, securities business. On this occasion, I did not plan to talk about this page, but please look at this page. The SBI Thai Online Securities in Thailand, SBI Royal Securities, BNI Securitas, FPT Securities. So we have those are the securities entities in Southeast Asia. In the banking business, we are operating in various areas and that applies also to securities business. And this is SBI Securities first half results. From April to September, on all of these lines, the numbers hit the record highs. In all levels, we achieved the record highs. And the growth is a very strong growth. SBI securities, the consolidated expense ratio is 58.1%, and much lower than other entities compared to Nomura or Daiwa. If the market goes down, then the smaller the expense ratio is, the more resilient you would find yourself to be. and the diversification of revenue sources and the strengthening of the earnings capability paid off and the revenue of SBA securities increased significantly. Please look at those details in each category. We saw a big growth. This is the quarterly, quarter-on-quarter comparison. In most of the cases, compared to the first quarter, second quarter, the second quarter was down. But in our case, 8.5% plus quarter-on-quarter basis. And then number of securities accounts at the SBI Group. For the very first time in Japan, the number exceeded 17 million. On October the 15th. And the zero revolution led us to the current situation. As to compound annual growth rate as of the end of September, 13.4%. So from end of March 2009 to end of March 2026, Kega 13.4%, while Nomura only 1.9%. The change going forward is the customer basis. Nomura has senior people as customers, while SBI has much younger customers. But nowadays, we are receiving more and more senior people as customers. Everyone passes away somewhere or the other, and that brings about the issue of inheritance. and that is connected to younger generation, namely their children. So in many cases, those young people will be or are our customers already, which is another additional benefit for us. And also Neo Media Strategy was, I think, very good. Neo Media Strategy was With that strategy, people criticized me. Why the financial group to be involved in neo-media? Well, when you don't understand, you don't understand. You need to look at the results.

In terms of the SBI securities business, in terms of the assets under custody, it was increased by 39% to 79 trillion yen. So since the start of the zero revolution, that was back in September 2023, it has accelerated in terms of the growth. So we are actually aiming towards 100 trillion yen. So we are diversifying the revenue sources, and we're definitely seeing the results. So these are in order of the revenue contribution. So in terms of the financial revenues, as you can tell from these paragraphs, so it has actually trended at a high level, trended open interest credit balance that is definitely supporting the overall financial revenue. So of course that is exceeding $3 trillion in mark. Just for the interest in the credit balance, so that is quite strong. Also in terms of the financial revenues, of which revenue for margin trading is 43.8 billion yen. Year-on-year, that has increased by 36.4%. It has been a steady growth. So next is on the trading revenues. So FX revenue was especially the strong driver. So those for the spot as well as for the swap revenue. And unless you have a system such as ours, we will not be able to generate a profit as successfully as we have. And of course we have If you have an automated system, actually quite often you would actually face issues. But actually we do have some manual operation. Very talented people, the experts are actually engaging in the FX revenue, so we are not facing any issues. Also in terms of the fixed income and so forth, of course we are not at the state to strongly grow that. So in terms of the foreign bonds, it's actually trending flat. But of course we are watching carefully the interest rate situation as well as the effects. But it has definitely become a steady base of our financial revenue. So this shows the investment trust balance as well as the investment trust fees. So both of them have been record high. This is quite incredible in terms of the investment trust. So if you actually look at the balance, you're increased by 49.5% year-on-year. Also, in terms of the balance, 32.3 trillion yen, quite an incredible level. Likewise, for the investment trust fees on the right-hand side, again, 7 billion yen record high. Year-on-year, 48.9% increase. Next is on the revenue for foreign stocks. SBI Securities has grown quite substantially, especially the U.S. stocks. So we have the trading value has been a record high, 7.3 trillion yen. Also in terms of the margin trading, it's 2.5 billion. So the 7.3 trillion, this is for the actual equity, the spot that is. And also in terms of the revenue, so the first step of this year, last year, that was 4 billion. Now we're actually seeing at 10 billion to 2.5 times. This is quite surprising. The SpaceX, perhaps I shouldn't say it is surprising, but it has actually contributed to the revenue. So 550 million yen, that is the sales commission, trading commission, and foreign exchange fees combined together. So at the time of the IPO of the U.S.-based SpaceX, we've actually partially underwritten that, and we've been able to generate 550 million yen. So SBA Securities, the retail, JGB Sales. So JGB has been really having the slogan to grow the sales of the JGB, and there has been an incredible growth. Also on the right-hand side, the top institutions by retail, JGB Sales. We are definitely top in the round, more than 300 billion yen or so. So timing is important. So you really have to really focus on certain timing and really have to promote it at that specific timing. So I've been involved in this business for a long time, so I can see it. What is the best timing and what should be conducted? So 50 years I have been doing my business. So I have honed this capability, intuition, shall we say, to assess that timing. So next is a primary and secondary underwriting business that is for the equity and fixed income. So in terms of the IPO underwriting, since April 2026 to September 2026, 25 companies have IPO'd. Within that 24 cases, SBI has been involved. So underlying, the percentage is close to 96% or so. So within that, SBI securities being the main, the manager, we have eight cases. So we have the corporate bonds as well as the public bonds. Actually, recently, they have been coming to us rather than us trying to sell. So that really shows our strong capability to sell. So SoftBank, the retail bonds, of course, it's quite a large unit. So we as the leading, the manager, so unless we are the lead manager, they will not be able to sell that. So given the current environment, the soft bank, the sector, the area they're trying to engage in, it might be challenging. So next on the expansion of the customer base and further strengthening of the revenue and some of the initiatives. So it's really a bossan to Kodomo Nisa, capturing the minor accounts. This is anticipation of the future. So we would like to really focus on this initiative. So our commercials, I'm pretty sure you have seen those in various places. This is definitely a focus area for us. This will be starting January 2027. We are expanding our minor accounts. In Japan, the population age 0 to 17 is 17 million. It's actually easy to remember, isn't it? 0 to 17-year-olds, currently 17 million in terms of the number. Junior Nisha, that was the predecessor, It had only 1.04 million accounts. So in terms of the penetration, it's mere 6%. So that is why this time around, we hope that this will come to its success. So also, we hopefully would actually go to the full-fledged NISA, which is for 18 years or above. So we are hoping that this will be successful. So that is why we are collaborating with SBI Shinsei Bank. So we have quite a lot of the interest been provided. It has been expansion of tools. So we can actually combine the assets of the parents and the child together. Those are some of the functionalities. Collaboration with the media business as part of our sales promotion. The role that media business is going to play definitely is going to be larger. Also the financial education, that is important. As far as Kodomo Nisa is concerned, we have this 0% trust fee, a so-called zero-kan. So this has drawn much attention from the market. Thank you very much. So this is the fourth round of the Zero Revolution, and this is an appeal to the parent and child asset-building households. So up until 17, you can use the Kodomo Nisa, and beyond 18, it will be All Country. So that is the flow that we would like to generate. So on the left-hand side, once you join, you can't really change the securities company. So that is why we have to focus on that to lock those customers in. Next is the Open Alliance Strategy. So we are collaborating with SMBC Group. So for instance, Olive Consulting, it has been launched already. So it was back in May 26th of 2026. That was the launch date. And already, as of the 29th of October of this year, we have 281,000 accounts. Also, the asset under custody is 2.54 trillion yen. So it is quite incredible the SMBC Group's capability in terms of the number of customers and also their really quality, the consulting channel. So that is definitely giving force to all of the consulting. And it has earned the trust of the customers, leading to these incredible numbers. Moving on to the digital, the affluent customers, we are seeing the increase in the number. So our securities, the customers, we have plenty of these digital affluent customers. So through all the consulting, we could have a referral service for partner companies, including SBI Group companies. So at the launch of the service, so we have various connections. and we've been engaging in a fairly highly specialized dialogue and extending consulting to the customers. Our next is on JR Kyushu. So we have announced the Strategic Business Alliance. So this is the first boss in the railway industry. And of course, it's a financial super app that has securities and other functions. So that is the intention of this business alliance. So we have a comprehensive financial platform, JQ Bank. Of course, this is a tentative name, but we would like to introduce this platform. So the financial, the functionalities of SBI Group, that is the banking, securities, insurance, and combine that with the JR Kyushu's railway, real estate, points, and so forth, those could be converged together. So that is the kind of app we intend to develop. So JR Kyushu, the customer base that they have, it's near 5 million in terms of the customer base. Moving on to insurance business. So we have various constituent companies, as you can tell. So Kyobo Life Insurance, that is from Korea, and Liho, it's bear insurance, is from Cambodia. So already, we have been launching our insurance businesses in various countries. And this is the consolidated performance across the board. It has been record high. I move on to Inforce, the total. So as of March end 2016, that is for 10 years. So 12.1% annualized growth that we have seen, or CAGR growth, rather. So that's been quite steady. So as of April end of 2025, we've topped 3 million in terms of Inforce. So we have 3.31 million in terms of the Inforce policies.

Now, moving on to the asset management business. Here, we have many new companies joining our group, including Rails Capital Works and SBI Okasa Asset Management. And under the circumstances, we have been achieving record high results. And the SBI Global Asset Management, the consolidated results. It's JGAP, and this has been growing steadily well, as you see here. and then the AUM of SBI Global Asset Management Group. The assets under management reached approximately 14 trillion yen and we are targeting 20 trillion yen during FY26. and with Asakura-san, we are working on this. And by FY29, we'd like to achieve 50 trillion yen AUM. And as for the PE investment business, this has also been involving a lot of new technical evolutions. And when we find these, we are very keen about capturing the momentum and opportunities. And they are blossoming nowadays. And they are... Thank you very much. In the first half, there's been six companies, seven companies in the first half, and in the second half, six companies. We have such great prospects. I have great expectations in this area. And that's a ripple. It goes up and down over time. But in terms of the development of the ecosystem, it's been making good progress, I think. So it's the most promising business. The Bitcoin, as an asset, we have been holding. But as for XRP... It's being used in various different forms. They would actually invite actual demand. So there is still the current repose holdings that are not in circulation, which is about 7.6 trillion yen. And as regards to the listing, according to my idea, which I do not speak about much. Maybe next year sometime we might do the listing. Maybe it's about time. Then again, there is a tricky part about this which is relating to the presidential election. Who is going to be elected? So I think President Trump's Republican Party would be winning. in both the upper house and lower house, but not many people are predicting that as I do. So, I don't know. But, in fact, during the previous election, Kamara, many people thought Kamara would be winning, but I was thinking Trump would be winning an overwhelming victory. And the reason why I thought so, I've been watching X all the time, and I've been checking Trump's speech, and and I've been especially noting the number of gatherings. It was completely different from that of the Democrats. And who are the Democrats who are not really visible? It's like maybe there are some leaders, regional leaders, but when it comes to the next candidate for the president, some people are still talking about Kamala Harris. And I don't think that would be the case. So how that outcome will be is the question. And whether the Clarity Act would pass or not, the administration, whether it's SCC or CFTC, they are administratively making sure that this cryptocurrency world is authorized. So it does not matter anymore. Around the world, this area is making progress. And for the U.S., which is most important, as fiat, as the key currency, in order for the U.S. to keep the dollars as the key currency, they need the cryptocurrency and the stable coin. So the U.S. would have to be making focus on this, whether it's Republicans or Democrats. Now, about the XRP Treasury. There's Evernote North that's been listed, and the market cap is now about 140 billion yen. Our voting rights is now 36.1%, and we are the largest shareholder and equity method associate, and the economic interest is 20.5%. And aside from this, there's XRP... issuing entity, Ripple Lab, Equity. We have about 9% stake in the Ripple Lab. So outstandingly, we have a great influence on the company. And the value upgrading would also lead to the value upgrade for our company as well. Moving on to the assets under management of the SBI Group, the private equity, the so-called unlisted equity. That investment is now 1.332 trillion yen. And as I see here, There is a great percentage of the U.S., which is about 496, 497 billion. And I've been shifting to the U.S. nowadays, too, that a lot of technology is coming out from the U.S. And in Japan, for instance, there's Shinsei Bank. How are we going to change it? We are getting a lot of implications from these technologies coming out from the US. So we are putting our capital in such areas so the US is large. Naturally, Japan is another big one. 283.4 billion yen is another big weight holder. Now, crypto assets business. Like I said earlier, the Clarity Act, there was instability throughout the first half. There were ups and downs, especially at the end of September, at the end of the fiscal year. There was a big drawdown. That could impact us just with such one day's drawdown. So such influence could be coming from the market with these cryptoassets. So as for the number of accounts for crypto assets, as you know, BitBank joined us from October 1st. This year it became our subsidiary, fully owned subsidiary. So with that now 1.116 trillion yen would be the balance. And some... Thank you very much. Thank you very much. As for the assets under management, we think we are the top holder in the market. And as for the number of accounts, Mercari has been having a lot of small-sized customers. So maybe they are top in the number of accounts, maybe. Now, next-gen business. This is including BioHealth, NeoMedia, Web3-related businesses, and MyNavi. MyNavi should not be staying here forever either, so at some point in time we may have to move to a different place. In any case, in the wide range of areas, we are doing various different businesses. Basically, we are engaged in the human resources. So this is similar to recruit. That is MyNavi. That's the general understanding. But there's also the media business that they're doing as well. So MyNavi is engaged in various different business areas. And its profitability is high as well. It's generating good profits. From here on, I'd like to go into the main topic for today. Here are the strategic initiatives being focused on in the current fiscal year. Like I said earlier, if I talk about these things too much, some other companies may imitate us immediately. So maybe I feel like I should refrain from talking about this too much, maybe just once a year. But in any case, the challenge is that WebEx webinar requests or there are so many requests coming to me for keynote speeches. And when I speak too much, when I try to refrain, on the other hand – Thank you very much. Some would have to be discreet to a certain extent. And if I speak too much, I could be revealing too much, so I should control myself. So there are five points here. And in short, I'd like to briefly talk about these. Especially, we have three TV cameras here. I'd like to be distinct and precise here. First, regarding the intensively strengthening security measures toward making the SBI group fully AI-driven. The security is very, very important. In other words, when the system is down, When our credibility is gone, our business will not be viable. We have been doing this business for 26, 27 years, and I truly think so. We consider security to be very, very important. Security, in many ways, has been... Thank you very much. So the high-performance AI, we need to enhance the level of AI, otherwise we cannot cope with the coming era. So cloud mythos, embedded cloud security, that's being introduced across the SBI group, that's been decided already. And now, furthermore, I would be checking the source code weakness. Thank you very much. Thank you very much. So we are authorized by Anthropik to use these certain functions, and we are going to utilize those functions as well. Fortunately, in such areas, we were one of the fastest companies to be acknowledged by Anthropik. It's not 100% just yet, but we are acknowledged to a lot of areas. So using mythos... I'd like to use this. Well, there are both defense side and offense side. As for the offense side, we don't need to offend or attack anyone. But on the other hand, when it comes to our system, when there's attacker, the white hacker would be doing the imitation of the attacking and draw out what is the vulnerability. And with that, as soon as possible, fix those bugs or issues that were found. That's what we are doing. and furthermore, 24-7, AI-powered security operations center is also available. Nowadays, AI shall be utilized to the fullest. Otherwise, you cannot do even such simple things either. So in our three biggest strategies, we are talking about AI-driven, fully AI-driven company is what we'd like to become. And also, we're going to do the on-chain strategy. Thank you very much. SBI Securities is using several AIs to diagnose and address vulnerabilities, utilizing the AI, prioritizing critical vulnerabilities. So for everything, you need to do the prioritization. Priority is very important. In other words, you need to do this. Of course, any detection, every single detection of the issues would have to be fixed. So with AI, in a few days, identify weakness. Maybe it should be much faster than a few days. We should identify those weaknesses much more quickly. and anything that may be a single tool cannot find would have to be detected and fixed so various different AIs are having various different uniqueness and combining these various different AIs would draw out great effect. In July 26, we began to use cloud security for vulnerability diagnosis. And from October to 2026, we are also using cloud methods for vulnerability diagnosis. So we are utilizing all those functions that's been authorized by Anthropic. So Mega 3 called by JFSA and two Mega 3 banks. Minister was talking about Mega 3, but I don't know what happened. I don't know how these Mega banks are actually utilizing AI now. to counteract against the cybersecurity. I don't get much news. Maybe I am speaking too much. Maybe it's better not to speak too much. I don't know which is better. Now, preparing for high-frequency AI-driven attacks with Eversafe's dynamic defense. So I have acquired this Korean company, SBI Everspin, We created a joint venture in Japan with this company, and we came to introduce those products into Japan. And the other day, NHK went to Korea to cover the story and visited Haosan, the representative of the company. Korea has been damaged very much by the cyberattacks, but the companies that were introduced to Everspin was saved. They were safe. That's the actual outcome they enjoyed. So we need to introduce more Eversafe. So Eversafe is preventing attacks at various different phases, like analytical prevention. It's making it difficult to analyze the structure and behavior of apps and web services because once it's analyzed by the attacker, it's over. And then the dynamic defense. We have already filed relevant patents in 11 different countries, 33 patents. So we're making sure constant changes and therefore the defense... and making analysis results unusable. And there is server-side verification, determines whether access is from legitimate use and blocks automated attacks. So we are always changing the defense style and making the attacker to do the analysis over and over again. As a result, it becomes... Thank you very much. Satoe Kusakabe, Hideyuki Katsuchi, Masato Takamura, Motoaki Shiino, Tomoya Asakura, Yasuo Nishikawa and their engineers, Eva Chan. She's the Taiwanese CEO. She's a very smart, excellent person. There's McAfee and various others, but they were all ousted from the market. Trend Micro became the outstanding market player. With the founder, I've been very close, who is Steve Chan. He sometimes comes over to Japan and I meet him whenever he does. So the development of AI infrastructure and AX toward becoming fully AI-driven. So in the cyber attacks, we can see how AI could be functioning in preventing the cyber attacks. So the AI promotion level is very important. Ever since April 2026, in the whole group, we have been promoting the structure of AI transformation, but we could not have done this alone, I judged. Therefore, with Rich AI, which I had their support, and with Yanagi Hara-san, he became our outside director. And with that, with the whole group, we are trying to promote this AX now. There's the top-down decision-making process. And there's community and view reports, and I'm always attending these meetings. The group's common AI structure that's introduced everywhere. All the 71 group companies are having this as a common AI platform. 71 companies and 10 companies with API integration. So with Microsoft 365, it's been also connected too. So we are on the way toward the full AI-driven transformation. As we do such things, the cost can be reduced very much. Within three years, the total of 48.2 billion yen cost reduction is expected, as shown here from these areas. Especially Shinsei Bank is large. Securities is also large. With such plans, we are working on cost reductions. and this AIX project, AI transformation is AIX. And not just in AIX, but there's going to be digital transformation and some other work process improvements. We are accelerating these activities all across the company and the groups. And I'm endeavoring to do this. I've been leading this movement so that the whole group would be moving. Our company group is relatively good and agile in doing such things. We are such a company.