This is the English translation of the document originally written in Japanese for
non-Japanese convenience. Although Japan Securities Finance intends tofaithfully translate the Japanese-written documents into English version, theaccuracy and correctness of translation are not guaranteed, so you are kindly
encouraged to refer to the original Japanese version of the document.

January 10, 2023
To All Shareholders:Company: Japan Securities Finance Co., Ltd.
Representative Executive Officer & President: Shigeki Kushida(Code No. 8511, TSE Prime)
Contact: Kentaro Hibi, General Manager, Corporate Governance Office(E-mail :info@jsf.co.jp)

NOTICE OF CONVENING DATE AND TIME, LOCATION AND AGENDA
MATTERS FOR THE EXTRAORDINARY GENERAL MEETING OF
SHAREHOLDERS, AND OPINION OF THE COMPANY’S BOARD OF
DIRECTORS REGARDING THE SHAREHOLDER PROPOSALSAs disclosed in the “Notice of Shareholder Request for Convening of an Extraordinary
General Meeting of Shareholders” dated November 22, 2022, Japan Securities Finance Co., Ltd.
(hereinafter, “the Company”) has received a request from a shareholder of the Company(hereinafter, the “Proposing Shareholder”) for the convening of an extraordinary general
meeting of shareholders.
In response thereto, in its “Notice of the Establishment of a Record Date for the
Extraordinary General Meeting of Shareholders” dated December 6, 2022, the Company
provided notice establishing December 21, 2022 as the record date for voting rights, and calling
for the convening of an extraordinary general meeting of shareholders (hereinafter, the“Extraordinary General Meeting of Shareholders”).In addition, at a meeting of the board of
directors convened today, a resolution as set forth below was adopted regarding the convening
date and time, location and agenda matters for Extraordinary General Meeting of Shareholders
as well as the opinion of the Company’s board of directors regarding the shareholder proposals.
Furthermore, pursuant to Article 306, Paragraph 1 of the Companies Act, the Company isplanning on filing a petition with the Tokyo District Court for the appointment of a general
meeting of shareholders inspector regarding the Extraordinary General Meeting of Shareholders.
I.

Date and Time, Location for the Extraordinary General Meeting of Shareholders(1) Date and Time
10:00 a.m. on Tuesday, February 7th, 2023
(2) Location
Conference Room, Japan Securities Finance Co., Ltd.

1

II.

Agenda Matters for the Extraordinary General Meeting of Shareholders(1) Election of persons who will be charged to investigate the status of the operations andproperty of the Stock Company as set forth in Article 316, Paragraph 2 of theCompanies Act. (1)(2) Election of persons who will be charged to investigate the status of the operations andproperty of the Stock Company as set forth in Article 316, Paragraph 2 of theCompanies Act. (2)(3) Election of persons who will be charged to investigate the status of the operations
and property of the Stock Company as set forth in Article 316, Paragraph 2 of theCompanies Act. (3)A summary of the various matters for resolution and the reasons for the proposals are asstated in the full text of the “Request for Convening of an Extraordinary General Meeting of
Shareholders (with Revision History)” received from the Proposing Shareholder on December 22,
2022 and attached hereto as an annex, and so please refer thereto. According to the Proposing
Shareholder, the “Request for Convening of an Extraordinary General Meeting of Shareholders(with Revision History)” is the revised wording of the “Request for Convening of an Extraordinary
General Meeting of Shareholders” dated November 21, 2002, which was disclosed by theCompany in the “Notice of Shareholder Request for Convening of an Extraordinary General
Meeting of Shareholders” dated November 21, 2022, by the Proposing Shareholder.
III.

Opinion of the Board of Directors regarding the Shareholder Proposals
As the result of careful consideration of the matters for resolutions of the extraordinary
general meeting of shareholders, the Company’s board of directors opposes all the matters forresolutions.
Since 2019, in response to the environmental changes surrounding the Company in recent
years, the Company has positioned the enhancement and strengthening of corporate governanceand the strengthening of profitability / improvement of capital efficiency as two urgent issues for
management, and has amassed sincere managerial efforts, and while these efforts are still indevelopment, they have been tied to certain results.
We absolutely ask for the deep understanding of all shareholders regarding theCompany’s policies, way of thinking and achievements.
Hereunder we will provide a specific explanation regarding the Company’s opinion.
1.

Company’s efforts regarding the appointment of a management teamIn 2019, as a company with a nominating committee, etc., we introduced a system that
separated oversight and execution in an effort to further enhance and strengthen corporate2

governance. Efforts as follows centered on the nominating committee have also been made to
improve the effectiveness of the appointment of the management team related to the mattersfor resolution at the Extraordinary General Meeting of Shareholders.
(1)
Thinking regarding composition, etc. of the board of directors and process for nominationof candidates
Last year, the Company revalidated the composition, etc. of its board of directors. As aresult thereof, based on the changing environment it has sought multifaceted skills fromdirectors such as digitalization and internationalization, and has reached the conclusion that it isimportant to have a balance between the number of people engaged in oversight and execution
and to have diversity in age and gender, so at the 112th ordinary general meeting of shareholders
convened in June of 2022, it added two new outside directors, adopting a system where theboard of directors is comprised of a total of seven directors; five outside directors and twointernal directors. Besides adding such important skills such as knowledge of business
management especially industry, knowledge of in fields of technological innovation such as DX
and unique financial services, efforts have also been made to diversify age composition.
(2)

Thinking regarding appointment of executive officers and appointment process
The thinking on the appointment of executive officers was comprehensively verified lastyear from the perspective of building an executive system for moving forward with the MediumTerm Management Plan. From the past the Company, based on the public role and uniquenessof securities finance services, has marshalled such talents as “someone who is fully aware of the
public role and capable of executing business” and “someone who has wide knowledge of theoverall securities and financing market,” but has newly added “internationalism,” “extensive
knowledge and experience regarding business administration and risk management” and“extensive knowledge and experience regarding finance and accounting” as expected talents.
Under this arrangement, in the nomination of specific candidates for executive officers,
nominations of persons with the required talents have been made on an individual basis from along list of candidates who come from inside the Company, who come from the public sector,
and who come from the securities and finance sectors, and in this process the respective
members of the nominating committee gain a deep understanding of the qualities and characterof the respective executive officers through deliberations at the board of directors and in thepreceding explanations.
Under this framework, efforts were made in the past to appoint executive officers frominternal personnel and to develop human resources to that end, but in executive personnel
matters for 2022, a person from a private financial institution who gain experience as adepartment manager and executive officer at the Company after joining the Company was
promoted to managing executive officer. In the future as well, in addition to aggressive efforts3

to foster and promote internal personnel, including persons hired mid-career, the policy will beto endeavor to appoint people from the outside who are capable of expanding our security
finance services and otherwise enhancing corporate value.
Under the next Medium-Term Management Plan currently be considered by the board of
directors, the enhancement of organizational transformation power through the development of
human resources, the securing of diversity and the like is positioned as one important topic to beaddressed, as a strategic issue to facilitated the advancement of the Company’s continued
growth and improved corporate value. The diversification of management personnel is also
considered to be greatly significant in the advancement of this organizational transformation.
(3)

Succession plan for president and representative executive officer
A succession plan has been established for the Company’s officers with regard to thesequalities required of officers. In particular, the president and representative executive officer
who takes charge of management as the leader of the executive officers, must be able to oversee
the execution of business and improve corporate value, and as the representative of acorporation that plays a public role, is required to have high ethical standards and other qualities.
Moreover, the nominating committee and board of directors have established opportunities, andhave ongoing discussions, regarding efforts to collect information on candidates and others, andto conduct interviews or discussions as needed.
Based on the efforts of foregoing sections (1) through (3), from the perspective ofcommitting to continued improvement in corporate value, the further strengthening ofcorporate governance and the strengthening of the Company’s stability, at the time of the startof the 7th Medium-Term Management Plan from FY 2023, our thinking at the current stage is asfollows regarding the consideration of a future successor for Shigeki Kushida, the current
Representative Executive Officer & President.
First, as our basic point of view are the following two points, founded on our thinking
regarding the Company’s business portfolio:· With a strong awareness of the Company’s public role as infrastructure for the securities
market, position the licensed margin trading business as the pillar of the businessportfolio; and,· Based on the fact that the margin trading business is highly impacted by market
fluctuations , etc., continuously strive to improve security finance services and trust
services and otherwise diversify sources of income, and make efforts to achieve
management goals with the awareness that capital efficiency can be better than in thepast.
Moreover, in the future development of the Company’s business, of the foregoing two
points, our public role will continued to be important, but at the same time, we have heightened4the importance of knowledge and experience related to securities and finance business which inrecent years has included technological innovation and the like.
As such, due to the characteristics of the Company’s business and under the Company’s
future vision of what it wants to become, the nominating committee will consider as the future
successor Shigeki Kushida, the current Representative Executive Officer & President, someone
who satisfies the qualities of foregoing section (3) based on a long list centering on people fromwithin the Company, include those have been hired mid-career, and the policy at this time is not
to include persons from the public sector. Furthermore, since the company will continue to play
an important public role, with the overall composition of the executive officer team, as addressed
above in foregoing section (2), we will nominate people who have the required qualities, on an
individual basis, from a long list of candidates who come from inside the Company, who comefrom the public sector, and who come from the securities and finance sectors. In addition,
premised on this sense of direction, through the process of executing the medium-term
management plans in the following and subsequent terms, the policy in the future will be to seeka sustainable and smooth succession while taking the time required develop the executive officer
team inclusive of the representative executive officer and president. Additionally, the policy will
also call for continued consideration to be given to ensuring transparency in the nominatingprocess.
Based on the foregoing, the Company’s board of directors believes there is no need toappoint a person to investigate the status of the operations and property of the stock company
as set forth in Article 316, Paragraph 2 of the Companies Act (hereinafter, “Investigator”) to again
investigate circumstances leading up to the appointment of officers in the past.

2.

Achievements and results
In recent years, the Company, pursuant to various managerial measures, has steadily
increased its ROE through the accumulation of efforts under the current Medium-Term
Management Plan. This fiscal year (2022), the management goal is to achieve an ROE of 4%, theinterim goal under the medium-term management policy, and at present the estimated ROE
based on the provisional calculation of the current fiscal year’s earnings is 4.17%, which is steadily
progressing towards the achievement of the interim goal, and we believe that we have been able
to establish a foothold for achieving the 2025 fiscal year goal of 5%. Please see the “<Remarks>
Company’s efforts” Section at the end hereof for the details of the measures undertaken by theCompany.

5

<ROE>

Also, in addition to the increase in the Company’s ROE, in our efforts to enhanceshareholder returns, the Company’s total shareholder return has increased to a level thatsignificantly outperforms the current TOPIX average.
<Total Shareholder Return (TSR)>

The Company believes it will be difficult to rapidly increase its ROE, based on its need tomaintain financial soundness and the restrictions placed on the scope of its business under laws
and regulations as a security finance company that is considered to serve as market infrastructure
through margin trading services and the like, and as such, first it will achieve an ROE of 5% along
the time axis up to FY 2025.
Naturally, the policy for FY 2026 and after is to further advance the efforts for improving
corporate value, and to keep making managerial efforts to realize a higher ROE level.

6

3.
It is appropriate to evaluate the Company’s directors and officers based on theirperformance after appointment and there is no need to make an issue of their careers prior toappointment
It is appropriate to evaluate the directors and officers based on their performance after
appointment in consideration of the management philosophy, and not evaluate them based on
past information prior to appointment in 2018 and 2019 as stipulated in the proposed mattersfor resolution, and as such there is no need to examine such information. The current
management team is making efforts to improve the ROE and enhance shareholder returns, andhas steadily maintained total shareholder return.
In fact, the Company’s current directors were elected with the support of nearly all
shareholders other than the Proposing Shareholder at the 112th ordinary general meeting ofshareholders convened in June of 2022. This is considered an extensive acknowledgement of theCompany’s various efforts to date and the results thereof by the shareholders.

4.

Regarding the necessity for background investigations for candidates
In the election of the management team, a candidate’s background and other mattersthat should be stated in the notice of the convening of a general meeting of shareholders areprescribed in detail in the Companies Act and the Regulations for Enforcement of the Companies
Act, and the Company has appropriately disclosed the information required under such laws andregulations. In addition, at present the Company is a company with a nominating committee,etc., and the nominating committee holds the authority to nominate the management team. The
nominating committee’s ways of thinking in making nominations, the qualifications required ofthe management team, the nomination process at the nominating committee and otherinformation which may be of value in determinations by shareholders have been voluntarily
disclosed by an integrated report, etc. in addition to the corporate governance report.
Furthermore, in the appointment of officers, including this case as well, the Company has
appropriately engaged in the responses required in corporate governance as a listed company,and has confirmed that people from the public sector are in compliance with the rules imposedon the Company and individuals when they are appointed as officers of the Company.
As such, the Company’s directors believe that the information required in the election of
the management team has already been widely disclosed, and there is no need to appoint an
Investigator to again investigate backgrounds, etc.
In addition, with regard to the election of candidates for directors, information other than
the foregoing information and the discussion process may include internal and external character
evaluations of individual candidates that cover both the positives and the negatives, informationthat falls under privacy such as medical history and other extremely confidential information, andif this were to become public through an investigation, the private information of those7

investigated would become public, and not only the Company but other listed companies would
be forced to nominate candidates on the premise that all information and discussion process will
become public, and this may interfere with the free exchange of opinions and decision making.
Also, the policy at the Company, as stated above, is to make an effort to perceive thedevelopment and diversification of human resources and organizational transformation as
important management issues for the future improvement of corporate value, but there areconcerns that in the appointment of outside personnel for this purpose, previous examples
where highly classified information have been investigated and made public will have chilling
effect, and as a result it will become extremely difficult to secure human resources, and this mayhinder the improvement of corporate value.
In addition to the foregoing, the Proposing Shareholder has expressed their intent to
conduct a forensic investigation that exhaustively investigates the emails and the like of people
related to the Company, but if such an investigation is conducted, matters unrelated to theprocess for nominating directors (for example, trade secrets and the exchange of confidential
information with clients, etc.) would be revealed to the Investigator, and would damage theCompany’s credibility with clients and others, and impede the execution of the Company’sbusiness.

5.
Circumstances differ between the Company and the other companies that have beenrequired to appoint Investigators
There are case to date in which other listed companies have been required to appoint
Investigators, but these cases are based on suspicions of violations of laws, regulations , etc. by
the companies. However, since no such circumstances exist at all at the Company, we believethat there is no reasonable basis for the appointment of the Investigator. Furthermore, theProposing Shareholder with regard to the No. 2 Matter for Resolution, asserts that there is a
suspicion of the violation of the National Public Service Act in the Company’s determination ofcandidates for director, but the Company has confirmed that people from the public sector are
in compliance with the rules imposed on the Company and individuals when they are appointed
as officers of the Company.

The Company will continue in the future to persist in making considerations based on thethinking on corporate governance, and enacting necessary measures with regard to how officers
are appointed, remunerated and incentivized, to realize the improvement of its medium- to longterm corporate value while supporting the market infrastructure.
END

8

<Remarks> Company’s efforts(1)
Fundamental point of view and goals regarding management
The Company is strongly aware of the public role required thereof as a securities financecompany that shoulders the infrastructure for the securities market, and its fundamental pointof view on management is to target becoming an enterprise that maintains strong financial
soundness and realizes the continuous growth and the enhancement of medium and long-term
corporate value required as a listed company.
Under this point of view, the Company recognizes that it is required to ensure further
commitment and transparency towards continuous growth and the enhance of corporate value
in the medium to long-term based on a strong governance system, and because thereof it
formulated and publicly released its “Medium Term Management Policy” in November of 2021.
Based on this policy, the Company’s management goal is to achieve an ROE of 4% in during thecurrent Medium-Term Management Plan (up through FY 2022), and to achieve an ROE of 5% in
during the next Medium-Term Management Plan (FY 2023 through FY 2025). Since the efforts
under the current Medium-Term Management Plan have steadily been manifested in earnings
and ROE trends, we will seek to hasten and strengthen the efforts we have made to date.
In the formulation of these ROE goals, from the perspective of engaging in managementthat is conscious of the capital costs that are also in the Corporate Governance Code, estimationsof the Company’s shareholder’s cost of equity was made using objective data and multiple
methods, and since the mid-4% range is now recognized, the ROE goal was set above that at 5%.
Furthermore, since securities finance companies, in their capacity as infrastructure for the
securities market, are unique in that they are subject to restrictions on financial soundness andtheir scope of business under laws, regulations and standards for participation in securities andfunds settlement systems , with low business strategy risk and high financial and earnings stability,
and such the cost of equity of the Company is considered to be somewhat lower than the generallevel.

(2)

Thinking regarding business portfolio
As a premise of the formulation of a management strategy , etc., the Company deliberates
and determines the fundamental thinking on its business portfolio in the board of directors, andthen publicly releases this thinking.
Specifically, with a strong awareness of its public role as infrastructure for the securities
market, the Company’s group provides a variety of securities and finance related services that
aggressively meet the diverse needs of the securities sector and finance sector, centering aroundsecurities finance services which serve as the core of the licensed margin trading business.
In addition, based on the fact that the margin trading business is highly impacted bymarket fluctuations , etc., we continuously strive to diversify our sources of income, and efforts

9are made to achieve management goals with the awareness that each business can become more
efficient than it has been in the past.
Based on the analysis noted above, the Company’s group will strive to realize the visionof the future targeted by the Company through a business portfolio consisting of securities
finance business (securities finance business serving as the core of margin trading and negotiablesecurities investment business), trust banking business, and real estate leasing business.

(3)

Efforts addressing sustainability issues
To realize a sustainable society, the establishment of an infrastructure that serves as thebasis for social economic activities is also a key factor, and is also listed as one of the sustainable
development goals (SDGs) (Goal 9). The Company’s group provides margin trading services as
infrastructure for the securities market and a variety of other services, it is making efforts toimprove liquidity on the securities and finance markets and enhance convenience for market
participants, and through these activities it seeks to play a part in the realization of a sustainable
society, including also support for the market participants who are making similar efforts.
The Company is advancing its efforts in the environment (E) and society (S) based on thisfundamental policy. Recent efforts include the promotion of academic research activities
through industry-academia collaboration (empirical research on negotiable securities margin
trading through joint research with the University of Tokyo utilizing distributed ledger
technology), Contributions to overseas securities and finance market infrastructure(technological cooperation with and investment in Indonesian securities finance company), andthe promotion of financial and economic educational activities (implementation of lectures
under the theme of “Finance and Securities Markets and Industry-academia Collaboration” by
the Faculty of Engineering at the University of Tokyo), etc.
In addition, the response to climate change is also recognized as a key managerial issue,
and information related to climate change is disclosed on the Company’s homepage andintegrated reports in line with the recommendations of the TCFD.

(4)

Enhanced disclosure of information
In order to deepen the understanding of the Company by shareholders and other various
stakeholders, efforts to enhance the disclosure of information are recognized to be a major issue.
In the current year, the Company prepared its first integrated report. The integrated reportcontains information on the Company’s business model, management policy, features as asecurities finance company, the activity status of the board of directors and various committees,
and other corporate governance related information, and addresses the status , etc. of the efforts
being made on the issue of sustainability.

10In addition, explanatory meetings for analysts and investors are convened upon thesettlement of accounts and interim settlement of accounts, and settlement explanatory
materials are publicly released , etc. on quarterly results.
We will continue to make efforts to enhance the disclosure of information in the future.
End

11

Annex(A summary of the matters for resolution and the reasons for the proposals)

Proposal 1

1.

Election of persons who will be charged to investigate the status of theoperations and property of the Stock Company as set forth in Article 316,
Paragraph 2 of the Companies Act. (1)Description of the Proposal(1)

Persons to Investigate the Status of the Operations and Assets
Kenji Shinjo, Hansen Nels Christian, and Akira Maekawa are hereby elected as persons toinvestigate the status of operations and assets of the Stock Company (the "Investigators") as set
forth in Article 316, Paragraph 2 of the Companies Act for the purpose of investigating thematters stated in the Objectives of the Investigation. The election of the Investigators shallbecome effective upon passage of this Proposal, and no separate agreement with the Company
shall be required to be entered into.
(a)

Investigator Candidate 1〔Name〕
Kenji Shinjo〔Date of birth〕
December 12, 1952
〔Career summary 〕
Apr. 1984: Prosecutor at The Tokyo District Public Prosecutors Office
Apr. 1998: Prosecutor at The Tokyo District Public Prosecutors Office, Public Prosecutor at theSupreme Public Prosecutors Office, and member of the Examination Committee for the Japanese
Bar Exam
Apr. 2001: Prosecutor at The Fukuoka District Public Prosecutors Office and Director of General
Affairs Department
Apr. 2005: Prosecutor at The Yokohama District Public Prosecutors Office and Director of Special
Crimes Department
Oct. 2006: Prosecutor at The Tokyo High Public Prosecutors Office
Apr. 2007: Prosecutor at The Tokyo High Public Prosecutors Office and Special Prosecutor
dispatched to Meiji University Law School
May 2010: Registered as a lawyer (Dai-Ichi Tokyo Bar Association), joined IPAX PARTNERS
Jan. 2016: Joined Ueda-Koichi Law Office (present)12Annex〔Significant concurrent positions〕
Lawyer at Ueda-Koichi Law Office〔Number of Company Shares owned〕
0(b)

Investigator Candidate 2〔Name〕
Hansen Nels Christian〔Date of birth〕
October 27, 1982
〔Career summary〕
Oct. 2008: Joined Skadden, Arps, Slate, Meagher & Flom LLP
Nov. 2008: Admitted to CA bar
July 2009: Visiting Scholar, Research Institute of Economy, Trade and Industry
Oct. 2009: Joined APEC Office, Trade Policy Bureau, Ministry of Economy, Trade and Industry
Nov. 2010: Joined Skadden, Arps, Slate, Meagher & Flom LLP
May 2011: Admitted to NY bar
Sep. 2015: Adjunct Instructor at Keio University Law School (present)
Feb. 2016: Registered as a Gaikokuho Jimu Bengoshi (Tokyo Bar Association)
June 2017: Local Partner at White & Case Law Offices (Registered Association)
Jan. 2020: Partner at White & Case Law Offices (Registered Association) (present)
Apr. 2020: Member of the Japanese Law Translation Council (present)〔Significant concurrent positions〕
Partner at White & Case Law Offices (Registered Association)
Adjunct Instructor at Keio University Law School
Member of the Japanese Law Translation Council〔Number of Company Shares owned〕
0(c)

Investigator Candidate 313

Annex〔Name〕
Akira Maekawa〔Date of birth〕
October 9, 1972
〔Career summary〕
Apr. 1999: Registered as a lawyer (Dai-Ichi Tokyo Bar Association), joined Okamura Law OfficeFeb. 2006: Financial Securities Inspector for Kanto Finance Bureau of the Ministry of FinanceJan. 2008: Joined Masuda & Partners Law Office
Aug. 2009: Established Maekawa Akira Law OfficeFeb. 2011: Partner at IOTA Law Offices (present)
Apr. 2016: Vice-president at the Dai-Ichi Tokyo Bar Association.
Mar. 2018: Outside Director at Japan Investment Adviser Co., Ltd. (present)
Apr. 2018: Mediator at Tokyo Summary Court (present)
June 2021: Outside Auditor at TRI bank Kanagawa (present)〔Significant concurrent positions〕
Partner at IOTA Law Offices
Outside Director at Japan Investment Adviser Co., Ltd.
Outside Auditor at TRI bank Kanagawa
Mediator at Tokyo Summary Court〔Number of Company Shares owned〕
0(2)
The Objectives of Investigation(a)
All matters deemed necessary by the Investigators concerning whether or not the process
by which the Company's Board of Directors submitted a proposal to appoint Mr. Shigeki Kushida
as a candidate for a new director at the Company's 109th Annual General Meeting of
Shareholders held in June 2019 and the process by which he was appointed President one monthafter being elected as a director (collectively, the "Mr. Kushida Personnel Matter") were basedon a fair personnel assessment by the Company without the involvement of a third party.
However, Mr. Shigeki Kushida is the tenth and current President of the Company since
the Company went public, and all of the previous presidents of the Company, including Mr.
Kushida, have been the BOJ alumnus and have served as Executive Directors of the Bank of Japan
since the Company went public in 1950, and there exists an unnatural and significant bias in the14Annexcareer history of successive presidents of the Company. Therefore, in light of the fact that the Mr.
Kushida Personnel Matter is only one part of the aforementioned bias, the Investigators may
additionally investigate the persons listed in (i) through (x) below ("Presidents, Etc.") only to theextent that the investigators judge necessary in investigating the Mr. Kushida Personnel Matter.
<Among the current and past executives of the Company, the names of the main persons who
are the BOJ alumni and who have served as Executive Directors of the BOJ, and their main
positions and tenure of office in the Company>(i)
Kiyoka Shirane , President (1950-62)(ii)
Tsutomu Taniguchi , President (1962-70)(iii)
Masayoshi Kamata , President (1970-79, 1983-85)(iv)
Kenichi Okada, President (1979-83)(v)
Tatsuo Tajima, President (1985-92)(vi)
Akira Aoki, President (1992-98)(vii) Kunio Kojima, President (1998-2004)(viii) Minoru Masubuchi, President (2004-12)(ix)
Eizo Kobayashi, President (2012-19)(x)
Shigeki Kushida, President (2019 - present)(Note 1)
Masayoshi Kamata, Kenichi Okada, Tatsuo Tajima, Akira Aoki, Kunio Kojima,
Minoru Masubuchi, and Eizo Kobayashi were appointed Chairman after retiring as President.
(Note 2)
Akira Aoki, Kunio Kojima, Minoru Masubuchi, and Eizo Kobayashi were appointed
as Senior Advisor or Special Advisor after retiring from President and Chairman.
(b)
All matters deemed necessary by the Investigators concerning whether or not the process
by which the Company's Board of Directors submitted a proposal to appoint Mr. Yutaka Okada
as a candidate for a new director at the Company's 108th Annual General Meeting of
Shareholders held in June 2018 and the process by which he was appointed ME Director one
month after being elected as a director (collectively, the "Mr. Okada Personnel Matter") werebased on a fair personnel assessment by the Company without the involvement of a third party,
and all matters deemed to contribute to improved transparency in the Company’s executive
nomination process.
However, among individuals who are Bank of Japan alumnus, those who have served as
Director-general of the Bank but have not served as Executive Director (“Director-general-level
Personnel"), including Mr. Yutaka Okada, have been appointed to the positions of ME Director or
Sr. ME Director of the Company on an ongoing basis without interruption since 1980 and there
exists an unnatural and significant bias in the career history of ME Directors or Sr. ME Directorsof the Company. Therefore, in light of the fact that the Mr. Okada Personnel Matter is only one

15Annexpart of the aforementioned bias, additional investigations of personnel matters relating to thepersons listed in (i) through (vii) below ("Sr. ME Directors, Etc.") may also be conducted only tothe extent that the Investigators judge necessary in investigating the Mr. Okada Personnel Matter.
<Among the current and past executives of the Company, the names of the main persons who
are Director-general-level Personnel, and their main positions and tenure of office in the
Company>(i)
Shizuka Sato , Sr. ME Director (1980-85)(ii)
Fumio Kimura , ME Director (1985-87), Sr. ME Director (1987-92)(iii)
Toshio Hayashi, ME Director (1992-94), Sr. ME Director (1994-98)(iv)
Tasuku Horiguchi, ME Director (1998-2002), Sr. ME Director (2002-05)(v)
Yasuhisa Hashimoto, ME Director (2005-09), Sr. ME Director (2009-12)(vi)
Toshihiro Oritate, ME Director (2012-16), Sr. ME Director (2016-18)(vii) Yutaka Okada, ME Director (2018-22), Sr. ME Officer (2022 - present)(Note) Toshio Hayashi, Tasuku Horiguchi, Yasuhisa Hashimoto, and Toshihiro Oritate wereappointed as President of JSF Trust and Banking Co., Ltd., a subsidiary of the Company, after theirretirement.

(3)
Method of Investigation and Reporting(a)
The Investigators shall conduct the investigation independently of the Company, andindependently of the proposal shareholders, who are requesting this Extraordinary General
Meeting of Shareholders.
(b)
The investigation period shall be three (3) months from the date of the appointment of
the Investigators by this Extraordinary General Meeting of Shareholders.
(c)
By the end of the investigation period, the Investigators shall conduct the necessary
investigations and deliver the document(s) to the Company describing the results of suchinvestigations (the “Investigation Report”) and make a public announcement of the contents
thereof. The Investigators shall also report the contents of the Investigation Report at the first
General Meeting of Shareholders to be held after this Extraordinary General Meeting of
Shareholders.
(d)
The Investigators may request that the Company’s executives disclose or deliver any
documents, etc., that the Investigators deem necessary for the investigation, or may request
reports on any matters that the Investigator deem necessary for the investigation. The
Company’s executives may not refuse such requests.
(e)
If any executive, employee, or any other person of the Company refuses to cooperatewith the investigation, or refuses or interferes with the investigation, or when the Investigators

16Annexor assistants are directly or indirectly pressured, etc. by any officer, employee, or any otherperson of the Company, the investigator shall state this in the Investigation Report.
(f)
The Investigators shall conduct interviews with Company executives and shall determine
the scope of facts to be investigated (hereinafter referred to as the “Investigation Scope”)(g)
The Investigation Scope shall be sufficiently broad to achieve the aim of the Investigators’
appointment, which is to investigate whether or not the nomination and appointment of
Presidents, Etc. and Sr. ME Directors, Etc. was conducted in a fair and impartial manner without
the involvement or undue influence of a third party. In addition, the Investigators may, at theirdiscretion, expand or change the Investigation Scope as necessary. In such cases, thecircumstances of such an expansion or change shall be explained in the Investigation Report.
(h)
The Investigators shall set the Investigation Scope, taking into account the Company’s
cost and resource allocation, so as not to have a significant adverse impact on the Company’s
corporate value.
(4)
Remuneration(a)
The Company shall, within socially reasonable limits, reimburse the expenses incurred by
Investigators (including daily allowances for investigators and assistants) in the course of theirinvestigations. When Investigators and assistants are reimbursed based on a reasonable time
charge in the ordinary course of their work activities, the compensation calculated on the basisof such time charge shall be deemed to be reasonable under socially recognized norms.
(b)
In the event the Company refuses to reimburse all or part of the costs of the investigationin response to the request of the Investigators, the proposal shareholders shall indemnify theInvestigators for the costs that were not reimbursed by the Company.
(5)

Other Matters
The Investigators may appoint assistants as they deem appropriate and may delegate apart of the Investigators' work activities to such assistants.
However, no executive or employee of the Company may be appointed as an assistant.

2.

Reason for the Proposal
Amakudari is considered to be an aspect of "S" of ESG, in that deemed public officials use
their positions to obtain high positions and high remuneration, which is antithetical to social
justice. It is also an aspect of "G" of ESG, in that it means that appointments to senior
management are made irrespective of the qualifications of the individual, and it also means alack of fairness in the selection of directors, which is the foundation of governance. In otherwords, the Company, with the presence of many amakudari, has, at the same time, a serious
issue regarding the "S" and "G" of ESG.

17

Annex
Although the Company's directors deny the existence of amakudari and assert there
exists fair personnel practices, it has been made clear that their assertion is unreasonableconsidering the objective status of the Company, such as the fact that all successive presidents
have been from the Bank of Japan. The Nomination Committee, which normally is tasked withpursuing such unreasonableness, has tacitly allowed amakudari for a long period of time, and theCompany's governance cannot be expected to correct itself through self-help efforts.
Accordingly, in order to clarify the circumstances that led to amakudari and to achieve
true ESG management in the Company, the Company proposes that the Investigators of this
Proposal carry out this investigation (“This Investigation").

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Annex
Proposal 2

1.

Election of persons who will be charged to investigate the status of theoperations and property of the Stock Company as set forth in Article 316,
Paragraph 2 of the Companies Act. (2)Description of the Proposal(1)

Persons to investigate the status of operations and assets
This shall be as described in “(1) Persons to Investigate the Status of the Operations andAssets" in Proposal 1.
(2)

Objectives of the Investigation
All matters deemed necessary by the Investigators concerning whether or not the process
by which the Company's Board of Directors submitted a proposal to appoint Mr. Shunichiro
Higuchi as a candidate for a new director and the process by which he was appointed Vice
President upon being elected as a director at the Company's 106th Annual General Meeting of
Shareholders held in June 2016 (collectively, the "Mr. Higuchi Personnel Matter") were based ona fair assessment by the Company without the involvement of a third party (e.g., the Ministry of
Finance; the MOF), and all matters deemed to contribute to improved transparency in the
Company’s executive nomination process.
However, various alumni from the MOF, including Mr. Shunichiro Higuchi, have been
appointed to the positions of ME Director, Sr. ME Director, or Vice President or higher at theCompany without interruption since 1960 and there exists an unnatural and significant bias in
the career history of ME Directors, Sr. ME Directors, or Vice Presidents of the Company.
Therefore, in light of the fact that the Mr. Higuchi Personnel Matter is only one part of theaforementioned bias, additional investigations of personnel matters relating to the persons listedin (i) through (x) below ("Vice Presidents, Etc.") may also be conducted only to the extent that
the Investigators judge necessary in investigating the Higuchi Personnel Matter.
<Among the current and past executives of the Company, the names of the main persons who
are MOF alumni, and their main positions and tenure of office in the Company>.
(i)Shoji Sasagawa, ME Director (1960-62), Sr. ME Director (1962-71)(ii)
Yoshisuke Isoda, Sr. ME Director (1971-72), Vice President (1972-77), Chairman (1977-79)(iii)
Kazumasa Tashiro, Vice President (1979-83)(iv)
Toshio Iyoda, Sr. ME Director (1984-85), Vice President (1985-92)(v)
Minoru Monden, Vice President (1992-2000)(vi)
Tetsuya Hiraoka, Vice President (2000-04)(vii) Hiroshi Saito, Vice President (2004-08)(viii) Hiromitsu Matsuda, Vice President (2008-13)

19

Annex(ix)(x)

Takao Hotta, Vice Chairman (2013-16)
Shunichiro Higuchi, Vice President (2016 - present)(3)

Method of Investigation and Reporting
This shall be as described in ”(3) Method of Investigation and Reporting" in Proposal 1,
and "Presidents, Etc.” and “Sr. ME Directors, Etc." shall be read as "Vice Presidents, Etc.".
(4)

Remuneration
This shall be as described in “(4) Remuneration" in Proposal 1.

(5)

Other Matters
This shall be as described in “(5) Other Matters" in Proposal 1.

2.

Reason for Proposal
In addition to the same reasons as for Proposal 1, there is a concern that the appointmentof Mr. Higuchi may be in violation of the National Public Service Act.
For more than 60 years, with the exception of 1983, the Company has had MOF alumni
serving as a ME Director, a Sr. ME Director, or a Vice President or higher without interruption.
This means that when an executive who is a MOF alumnus retires, another MOF alumnus isappointed as an executive of the Company at the same time, which raises the possibility that
personnel information is being exchanged between the MOF and the Company, i.e., that the MOF
is “providing the Company with information on persons who were previously executives” for the
purpose of "having them assume their positions" as defined in Article 106-2, Paragraph 1 of the
National Public Service Act.
The appointment of MOF alumni as executives at the Company is strongly suspected tobe the result of a violation of the National Public Service Act, which is a serious issue pertaining
to the fundamentals of the "S" and the "G" in ESG. We, therefore, propose this Investigation inorder to dispel such suspicions through this Investigation and to realize highly transparent andtrue ESG management at the Company.

20

Annex
Proposal 3

Election of persons who will be charged to investigate the status of theoperations and property of the Stock Company as set forth in Article 316,
Paragraph 2 of the Companies Act. (3)1.
Description of the Proposal(1)
Persons to Investigate the Status of Operations and Assets
This shall be as described in “(1) Persons who Investigate the Status of Operations and Assets" in
Proposal 1.
(2)

Objectives of the Investigation
All matters deemed necessary by the Investigators concerning whether or not the process
by which the Company's Board of Directors submitted a proposal to appoint Mr. Shuya Iimura asa candidate for a new Auditor at the Company's 106th Annual General Meeting of Shareholders
held in June 2016 and the process by which the proposal was submitted at the Company's 109th
Annual General Meeting of Shareholders held in June 2019 to nominate him as a candidate fordirector (collectively, the "Mr. Iimura Personnel Matter") were based on a fair personnel
assessment by the Company without the involvement of a third party, and all matters deemed
to contribute to improved transparency in the Company’s executive nomination process.
However, persons from the TSE, including Mr. Shuya Iimura, have been appointed as
Directors or Auditors without interruption since 1974 and there exists an unnatural andsignificant bias in the career history of Directors or Auditors of the Company. Therefore, in lightof the fact that the Mr. Iimura Personnel Matter is only one part of the aforementioned bias,
additional investigations of personnel matters relating to the persons listed in (i) through (vii)
below ("Executives In Charge of Audit, Etc.") only to the extent that the investigators judge
necessary in investigating the Mr. Iimura Personnel Matter.
<Among the current and past executives of the Company, the names of the main persons who
are TSE alumni, and their main positions and tenure of office in the Company>(i)
Yukio Uehara, Director (1974-80)(ii)
Atsushi Yasui, Director (1980-84), Auditor (1984-89)(iii)
Masataka Takahashi, Auditor (1989-94), Outside Auditor (1994-98)(iv)
Koji Takahashi, Outside Auditor (1998-2004)(v)
Yoshiyasu Arai, Outside Auditor (2004-08)(vi)
Ushio Mizuno, Outside Auditor (2008-16)(vii) Shuya Iimura, Outside Auditor (2016-19), Outside Director (Audit Committee) (2019present)(3)

Method of Investigation and Reporting21

AnnexThis shall be as described in “(3) Method of Investigation and Reporting" in Proposal 1,
and "Presidents, Etc.” and “Sr. ME Directors, Etc." shall be read as "Executives In Charge of Audit,
Etc.".
(4)

Remuneration
This shall be as described in “(4) Remuneration" in Proposal 1.

(5)

Other Matters
This shall be as described in “(5) Other Matters" in Proposal 1.

2.

Reason for Proposal
Mr. Shuya Iimura, a TSE alumnus, is an independent Outside Director of the Company andserves as the Chairman of the Audit Committee.
However, TSE alumni have held positions as officers of the Company without interruption
over the past 48 years, and it is strongly suspected that personnel information may have been
exchanged between the Company and the TSE in the process of such exchange. Irrespective of
his qualifications and abilities, when Mr. Shuya Iimura is in the position of Chairman of the Audit
Committee, a position that requires a high degree of independence as a result of familiarity
between the Company and the TSE, there are concerns over his independence and suitability forthe position.
The independence and suitability of outside Directors are the cornerstone of governancein ESG, and through This Investigation, it should be made clear whether or not the appointmentof Mr. Shuya Iimura was the result of fair personnel practices by the Company.
Once past actions have been verified through This Investigation, it is essential that theCompany reassess the pros and cons of continuing to appoint executives from certain
organizations, as well as the process of appointing outside personnel, in order to practice true
ESG management.

22