TSE Code 8511
June 3, 2024
To Shareholders
Director Representative Executive Officer & President
Shigeki Kushida
JAPAN SECURITIES FINANCE CO., LTD.
1-2-10, Nihonbashi-Kayabacho, Chuo-ku, Tokyo, JapanNOTICE OF CONVOCATION OF
THE 114th ANNUAL GENERAL MEETING OF SHAREHOLDERS
Notice is hereby given that the 114th Annual General Meeting of Shareholders (the“Meeting”) of Japan Securities Finance Co., Ltd. (the “Company” or “JSF”) will be held as
described below.
You may exercise your voting rights using either of the following methods, and we ask
that you exercise your voting rights after reviewing the Reference Materials concerning theMeeting as described below.
[When exercising your voting rights in writing (voting right exercise form)]
Please mark your vote for or against the proposals on the enclosed Voting Rights
Exercise Form and return the form to the Company by 5:20 p.m. (JST) on Monday, June 24,
2024.
[When exercising your voting rights via the Internet, etc.]
When exercising your voting rights via the Internet, etc., please carefully read the “Notes
on the Execution of Votes" before exercising your voting rights.
Yours very truly,

1Details❶ Date and Time

10:00 a.m. on Tuesday, 25 June, 2024

➋ VenueJAPAN SECURITIES FINANCE CO., LTD., Conference Room
1-2-10 Nihonbashi-Kayabacho, Chuo-ku, Tokyo, Japan➌ Agenda for the
Meeting

Report:2. The 114th fiscal year (from April 1, 2023 to March 31, 2024)
Financial Statements
Matters for
Resolution:➍ Notes on the
Execution ofVotes

1. The 114th fiscal year (from April 1, 2023 to March 31, 2024)
Business Report, Consolidated Financial Statements andReport of audits of the consolidated financial statements by
the Independent Auditor and Audit Committee.

Election of Seven (7) Directors

ProposalPlease refer to “Notes on the Execution of Votes” on next page

Note: These documents have been translated from the Japanese originals for reference purposes only. In
the event of any discrepancies between these translated documents and the Japanese originals, theoriginals shall prevail. The Company assumes no responsibility for this translation or for direct,
indirect, or other forms of damages arising from the translations.

2Notes on the Execution of Votes.
1. With regard to the exercise of voting rights via the Internet.
(1) Shareholders exercising their voting rights via the Internet can only do so via the website
designated by the Company (https://www.e-sokai.jp). However, please note that thevoting service website cannot be accessed from a mobile device without an Internet
connection.
(2) If you are exercising your voting rights via the Internet, please enter your “voting code”
and “password” indicated on the proxy voting form and follow the instructions on thescreen to register whether you approve or disapprove of each proposal. We ask that you
exercise your voting rights on or before 5:20 p.m. (Japan standard time) on Monday, June24, 2024.
(3) If you exercise your voting rights via the Internet multiple times, the last cast vote will
prevail.

Inquiries about the Exercise of Voting Rights via the Internet
Transfer Agent：JAPAN SECURITIES AGENTS, LTD.
Agency Department[Direct Line for Web Support (Toll free)] 0120-707-743
Accessible from 9:00 a.m. to 9:00 p.m. on business days,
Saturdays, Sundays, and national holidays.
2. Platform for the Electronic Exercise of Voting Rights
Institutional investors may use the Electronic Voting Platform operated by ICJ Inc. toexercise their voting rights.
END

3

REFERENCE MATERIALS CONCERNING
THE GENERAL MEETING OF SHAREHOLDERS
Proposal

Election of Seven (7) Directors

As the term of office of all directors will expire at the conclusion of this General Meeting, theCompany proposes the election of seven (7) directors, (including five (5) outside directors), in
accordance with the decision of the Nominating Committee.
The candidates are follows.
No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1968
May 1999
Jan. 2004
Jun. 2004
Jun. 2005
Apr. 2007

Naotaka Obata(Oct. 15, 1944）
Reappointment

OutsideIndependent

1

Jun. 2010
Jun. 2012
Jun. 2018
Jun. 2019

Jun. 2023

Joined The Mitsubishi Bank, Ltd.
Managing Executive Officer of The Bank of TokyoMitsubishi, Ltd.
Senior Managing Executive Officer of The Bank ofTokyo-Mitsubishi, Ltd.
Deputy President, The Bank of Tokyo-Mitsubishi,
Ltd.
President and CEO, Diamond Lease Company
LimitedPresident and CEO, Mitsubishi UFJ Lease &Finance Company Limited (currently Mitsubishi HC
Capital Inc.)
Chairman, Mitsubishi UFJ Lease & Finance
Company Limited
Executive Advisor to the Board, Mitsubishi UFJ
Lease & Finance Company Limited
Special Advisor, Mitsubishi UFJ Lease & Finance
Company Limited
Director and Chairperson of Board of Directors ofJapan Securities Finance Co., Ltd. (current
position)
Honorary Advisor, Mitsubishi HC Capital Inc.
(current position)

Number of Company Shares owned―
Term of Office
5 years (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
12/12 (100％)
Nominating Committee
11/11 (100％)Compensation Committee
8/8 (100％)(Reasons for selecting the candidate and expected roles)
He has extensive experience in corporate management in the financial industry. Through his overseas
business experience, he also has extensive knowledge and insight on international businessdevelopment, and therefore, the Company has determined that he can be expected to play a sufficientrole in the effective supervision of the Company's management and in decision-making on medium- andlong-term management policies, etc., from an independent and objective standpoint as an outside
director, and therefore nominates him as a candidate for director.
(Independence)
He is an independent director as provided for under the rules of the Tokyo Stock Exchange, Inc. If this
proposal is approved, the Company plans on his continued appointment as an independent director.
There are no transactions between the Company and Mitsubishi HC Capital Inc., where he served as the
President and CEO until June 2010.

4

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1973
Apr. 1994
Apr. 1997
Apr. 2000
Jul. 2005

Shoko Sugino

Mar. 2007（Aug. 7, 1945）
Reappointment

OutsideIndependent2

Jun. 2018
Jun. 2019
Jun. 2022

Registered Lawyer
Joined Fujibayashi Law OfficePartner Attorney at Fujibayashi Law Office (current
position)
Professor for The Legal Training and ResearchInstitute of JapanTokyo Family Court Conciliation
Committee Member
Environment Dispute Coordination
Commission Member
Outside Audit & Supervisory Board Member of
Kitoku Shinryo Co., Ltd.
Outside Audit & Supervisory Board Member ofTakeei Corp. (current position)
Director of Japan Securities Finance Co., Ltd.
(current position)
Outside Director of Janome Corp. (current
position)

Number of Company Shares owned
2,100
Term of Office
5 years (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
12/12 (100％)
Nominating Committee
11/11 (100％)
Audit Committee
12/12 (100%)Compensation Committee
8/8 (100％)(Significant concurrent positions)
Partner Attorney at Fujibayashi Law OfficeOutside Audit & Supervisory Board Member of Takeei Corporation
Outside Director of Janome Corporation(Reasons for selecting the candidate and expected roles)
As an attorney at law, she has extensive experience and knowledge in legal and compliance matters, aswell as in internal control, sustainability, and corporate governance. The Company has determined that she
can be expected to play a sufficient role in the effective supervision of the Company's management and indecision-making on medium- and long-term management policies, etc., from an independent and objective
standpoint as an outside director, and therefore nominates her as a candidate for director. Although she
has not been directly involved in the management of a corporation, other than as an officer, the Company
believes that she is well qualified to serve as an outside director for the reasons stated above.
(Independence)
She is an independent director as provided for under the rules of the Tokyo Stock Exchange, Inc. If this
proposal is approved, the Company plans on her continued appointment as an independent director.

5

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1977
Apr. 2001
Jan. 2002

Oct. 2003

Kensuke
Futagoishi

Jun. 2004
Jun. 2006
Nov. 2007
Jun. 2009（Oct. 6, 1952）
Reappointment

3

OutsideIndependent

Jun. 2010
Jun. 2018
Jun. 2022

Joined The Sanwa Bank, Limited
General Manager, Retail Banking Planning
Division, UFJ Holdings, Inc.
General Manager, Gotanda Corporate Sales
Department and Branch Manager, Gotanda
Branch, UFJ Bank Limited
Joined IY Bank Co.,Ltd. (currently Seven Bank,Ltd.)
Director of IY Bank Co.,Ltd.
Director, Executive Officer of Seven Bank, Ltd.
Director, Managing Executive Officer of Seven
Bank, Ltd.
Director, Senior Managing Executive Officer ofSeven Bank, Ltd.
President and Representative Director of Seven
Bank, Ltd.
Chairman and Representative Director of Seven
Bank, Ltd.
Special Advisor of Seven Bank, Ltd. (current
position)
Director of Japan Securities Finance Co., Ltd.
(current position)

Number of Company Shares owned
1,600
Term of Office
2 years (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
10/12 (83％)
Nominating Committee
9/11 (82％)
Compensation Committee
6/8 (75％)(Reasons for selecting the candidate and expected roles)
He has extensive experience in the management of financial institutions with unique and leading-edgebusiness models, as well as a wealth of knowledge and extensive insight on internal control and risk
management. The Company has determined that he can be expected to play a sufficient role in the effective
supervision of the Company's management and in decision-making on medium- and long-term
management policies, etc., from an independent and objective standpoint as an outside director, andtherefore nominates him as a candidate for director.
(Independence)
He is an independent director as provided for under the rules of the Tokyo Stock Exchange, Inc. If this
proposal is approved, the Company plans on his continued appointment as an independent director. There
are no transactions between the Company and Seven Bank, Ltd., where he served as the President andRepresentative Director until June 2018.

6

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1991
Oct. 1995
Jun. 2000
Jun. 2005
Jun. 2006
Jul. 2020

Takayoshi
Yamakawa

Jan. 2021
Apr. 2021（Oct. 2, 1965）

Jun. 2021

Reappointment

OutsideIndependent

4

Jun. 2022

Joined Yokogawa Hewlett Packard Co.
Joined Boston Consulting Group
Founded (co-established) Dream Incubator Inc.
Director, CTO
Vice Representative Director of Dream
Incubator Inc.
Representative Director & CEO of Dream
Incubator Inc. (retired in Jun. 2020)
Representative Partner of Business Producer
LLC (current position)
Outside Director of BitStar Inc. (current position)
Outside Director of Baseconnect Inc. (current
position)
Outside Director of Akatsuki Securities, Inc.
(current position)
Outside Director of FP Corp. (current position)
Director of Japan Securities Finance Co., Ltd.
(current position)(Significant concurrent positions)

Number of Company Shares owned
2,600
Term of Office
2 years (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
12/12 (100％)
Nominating Committee
8/8 (100％)
Audit Committee
12/12 (100%)Compensation Committee
3/3 (100％)

Representative Partner, Business Producer LLC
Outside Director, Akatsuki Securities, Inc.
Outside Director, FP Corporation(Reasons for selecting the candidate and expected roles)
He has extensive knowledge and insight into trends in technological innovation related to DX, etc., as well
as extensive experience in corporate management in the industrial sector. The Company has determinedthat he can be expected to play a sufficient role in the effective supervision of the Company's management
and in decision-making on medium- and long-term management policies, etc., from an independent andobjective standpoint as an outside director, and therefore nominates him as a candidate for director.
(Independence)
He is an independent director as provided for under the rules of the Tokyo Stock Exchange, Inc. If this
proposal is approved, the Company plans on his continued appointment as an independent director. There
are also no transactions between the Company and Business Producer LLC, where he is theRepresentative Partner, and between the Company and Dream Incubator Inc., where he was theRepresentative Director & CEO until June 2020.

7

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1983
Dec. 2001
Apr. 2006
Nov. 2006
Jun. 2007
Apr. 2009

Setsuko Egami（Jul. 16, 1950）
Reappointment

OutsideIndependent

5

Jun. 2011
Apr. 2012
Jun. 2015
Jun. 2018
Jun. 2020
Apr. 2021
Jun. 2023

Chief Editor of Travail of Japan Recruit Center
Head of Frontier Service Development Laboratoryof East Japan Railway Company
Visiting Professor of Graduate School of Public
Management, Waseda University
Member of Government Tax Commission
Outside Auditor of Taisho Pharmaceutical Co., Ltd.
Professor of Graduate School of Humanities,
Musashi University
Professor of Faculty of Sociology, Musashi
University
Outside Auditor of Yusen Logistics Co., Ltd.
Dean of Faculty of Sociology, Musashi University
Outside Director of Mitsubishi Estate Co., Ltd.
Outside Director of Mitsubishi Motors Corporation
Outside Director of Resona Holdings, Inc. (current
position)
Professor Emeritus, Musashi University (current
position)
Director of Japan Securities Finance Co., Ltd.
(current position)

Number of Company Shares owned
1,300
Term of Office
1 year (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
8/9 (89％)
Compensation Committee
4/5 (80％)(Significant concurrent positions)
Professor Emeritus, Musashi University
Outside Director of Resona Holdings, Inc.

(Reasons for selecting the candidate and expected roles)
She has extensive knowledge and broad insight on human resource development, risk management, andcorporate management. The Company has determined that she can be expected to play a sufficient role in
the effective supervision of the Company's management and in decision-making on medium- and long-term
management policies, etc., from an independent and objective standpoint as an outside director, andtherefore nominates her as a candidate for director.
(Independence)
She is an independent director as provided for under the rules of the Tokyo Stock Exchange, Inc. If this
proposal is approved, the Company plans on her continued appointment as an independent director.

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)
May 2008

Mar. 2009
Jun. 2010
May 2011
Mar. 2013
Apr. 2017

Shigeki Kushida

May 2019
Jun. 2019（Jun. 8, 1958）

6

Reappointment

Jun. 2022

Deputy Director-General of Personnel andCorporate Affairs Dept. (Personnel Management).,
BOJ
Director-General of Personnel and Corporate
Affairs Dept., BOJ
Director-General of Monetary Affairs Dept., BOJ
General Manager of Nagoya Branch, BOJ
Executive Director of BOJ
Senior Advisor of American Family Life Assurance
Company (currently Aflac Japan Ltd.)
Advisor of Japan Securities Finance Co., Ltd.
Director (current position) Representative
Executive Officer & President (current position)
Director of JSF Trust and Banking Co., Ltd.
(current position)

Number of Company Shares owned
18,100Term of Office
5 years (at the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
12/12 (100％）
Nominating Committee
11/11 (100％)Compensation Committee
8/8 (100％）(Significant concurrent positions)
Director of JSF Trust and Banking Co., Ltd.
Outside Director of Denso Corp.

(Reasons for selecting as a candidate)
He has extensive experience and knowledge in the field of finance and securities, including serving as the
Executive Director of the Bank of Japan, and has been involved in the management of the Company as
President and Representative Executive Officer since 2019. The Company has determined that as the
person who leads and directs the executive officers and as the chief management executive, he can be
expected to play a sufficient role in improving the supervisory function, etc. of the Board of Directors and in
determining the medium- to long-term management policies of the Company, etc., by concurrently serving
as a director, and therefore nominates him as a candidate for director.

8

No.

Name

Career Summary, Position and Duty

（Date of Birth）(Significant concurrent positions)Apr. 1982
Feb. 2008
Jun. 2011
Jun. 2015
Jun. 2016
Jun. 2018
Jun. 20197

Kenji Fukushima（Nov. 28, 1959）

Apr. 2022
Jun. 2022

New

Number of Company Shares owned

Joined Japan Securities Finance Co., Ltd.
General Manager of Margin Loan Dept.
Corporate Officer & General Manager ofInformation Systems Planning Dept.
Corporate Officer & General Manager of Planning
Dept.
Managing Director of Japan Securities FinanceCo., Ltd.
Senior Managing Director
Senior Managing Executive Officer (retired in Mar.
2022)
Advisor of JSF Trust and Banking Co., Ltd.
Executive Vice President of JSF Trust andBanking Co., Ltd. (Scheduled retirement in June
2024.)

95,400Term of Office－
取締役会等の出席状況－(Reasons for selecting as a candidate)
He has served as a General Manager and Director of the Company and is familiar with all aspects of theCompany's business activities. Moreover, he has extensive experience and knowledge in the fields offinance and securities, as well as knowledge of finance. The Company has determined that he can be
expected to play a sufficient role in the effective supervision of the Company's management and in decisionmaking on the Company's medium- to long-term management policies, etc., and therefore nominates him
as a candidate for the position of director.

Reappointment

Candidate for
Reappointment
Director

New

Candidate for
New Director

OutsideCandidate for
Outside Director

Independent

Candidate for
Independent Director(Notes) 1. There are no special interests between the respective candidates and the Company.
2. Setsuko Egami's name in the family register is Setsuko Kusumoto.
3. Pursuant to the provisions of Article 427, paragraph (1) of the Companies Act, the Company has entered into
agreements with Mr. Naotaka Obata, Ms. Shoko Sugino, Mr. Kensuke Futagoishi, Mr. Takayoshi Yamakawa and
Ms. Setsuko Egami to limit their liability for damages under Article 423, paragraph (1) of the Companies Act. The
maximum amount of liability for damages under such agreement is the minimum liability amount provided in
Article 425, paragraph (1) of the same Act. If the election of Mr. Kenji Fukushima is approved, the Company
plans to enter into the same Limited Liability Agreement with him.
4. Indicates the status of attendance at meetings of the Board of Directors and each committee held after
assuming office as directors.
5. The Company has concluded a Directors' and Officers' Liability Insurance Policy as stipulated in Article 430-3,
paragraph (1) of the Companies Act, insuring its directors, executive officers, corporate officers, and otherimportant employees, as well as officers at its subsidiaries. Under this Insurance Policy, the insured Officers, etc.
are covered for damages (compensation for damages and litigation expenses) that may arise from liability for theactions related to their duties, or from being subjected to claims in connection with such liability. However, there
are certain exemptions, such as cases where the actions are carried out with the understanding that theirconduct violates laws and regulations. If each candidate is elected and assumes office as a Director, eachcandidate will be included in the insurance contract as an insured. This insurance policy is scheduled to be
renewed at the next renewal under the same level of coverage.
6. Mitsubishi Motors Corporation, where Ms. Setsuko Egami served as an outside director until June 2021, failed
to ensure that certain foreign technical intern trainees at its Okazaki Plant received technical training inaccordance with the technical training plan approved by the Organization for Technical Intern Training. In January
2019, based on the Act on Proper Technical Intern Training and Protection of Technical Intern Trainees,
Mitsubishi Motors Corporation suffered the revocation of certification for its technical intern training plan and anorder for improvement. Although she was not aware of this fact until it came to light, during her term of office, Ms.
Egami expressed her opinions from the viewpoint of compliance with laws and regulations, she alerting others
and otherwise appropriately executed her duties.

9[Reference 1 ] Skills List for Director Candidates (Skills Matrix)

Name

Corporate
management

FinanceSecurities
EconomicsInternationalexperience

Naotaka Obata

○

○

○

Judicial
Affairs
ComplianceInternal
Controls
RiskManageme
nt

ESG

○

○

○

○

○

○

○

○

○

○

○

○

○

○

Financial
Accounting○

Shoko Sugino
Kensuke Futagoishi○○

Takayoshi Yamakawa○○

Setsuko Egami○

Shigeki Kushida

○

○
○

○

○

○

Kenji Fukushima○[Reference 2 ] Planned Appointments of Director Candidates to Chairperson of the Board of Directors, and to
Nominating, Audit, and Compensation Committees
Seven (7) candidates for directors (including two (2) females) will assume the following positions after theirelection at the Shareholders' Meeting.
Name

Naotaka Obata

Position

Nominating
Committee

Audit
Compensation
Committee
Committee

Chairpersonof the Board Chairpersonof Directors

Chairperson

Shoko Sugino

MemberKensuke Futagoishi

MemberTakayoshi Yamakawa

MemberChairperson

MemberMemberReappointment
Outside Director
Reappointment
Outside Director
Reappointment
Outside Director
Reappointment

MemberOutside Director
MemberSetsuko Egami

Remarks

Reappointment
Outside Director
Reappointment

Shigeki Kushida

MemberMemberRepresentative
Executive Officer &President

Kenji Fukushima

Member10

New appointment
Non-executive director

Ⅰ Matters Pertaining to the Current Status of the Company's Group(1) Business progress and its results(Primary business activities of the corporate group)
The Group consists of the Company, two consolidated subsidiaries (JSF Trust and Banking
Co., Ltd. and Nihon Building Co., Ltd.), and two equity method affiliates. With a firm recognitionof our public role in supporting the infrastructure of the securities and financial markets, we
proactively respond to the diverse needs of the securities and financial industries and provide avariety of securities and financial related services, with a focus on the securities finance businesscentered on the margin loan business. Given that the margin loan business is significantly
affected by market fluctuations, we will also continue our efforts to diversify our revenue sources
and work to achieve our management goals while being more conscious than ever of improving
capital efficiency in each of our businesses. Under this concept, JSF Group will endeavor to
realize its vision of the future through a business portfolio consisting of security financing
business centered on loans for margin transactions, securities investment business, trust
banking business and real estate leasing business.
(Financial and economic environment)
During the current consolidated cumulative period (from April 1, 2023 to March 31, 2024), theeconomic environment was characterized by downside risks due to the impact of monetary
tightening in the United States and various European countries, concerns over a rapid slowdown
in the Chinese economy and other factors. However, the economy continued to recover,supported by improvements in corporate earnings and inbound demand.
Looking at the stock market, the Nikkei 225 (closing price) started at 28,188 yen at the
beginning of the period, and continued to rise, mainly driven by expectations over the various
initiatives by listed companies to realize management that is conscious of capital costs and stock
prices. In October, the market softened due to tensions in the Middle East, but rallied again in
November on speculation of the end of US interest rate hikes and strong corporate performance.
As the year progressed, such trends accelerated, with the index reaching 39,098 yen on
February 22nd, its highest point on record in 34 years. Subsequently, despite the elimination of
the BOJ’s negative interest rate policy, relief prevailed in the market as the continuation of an
accommodative financial environment was confirmed. As the result, the index rose to its highest
point of the period, 40,888 yen and closed at 40,369 yen at the end of March.
Looking at the standardized margin trading purchase balance on the Tokyo market and othermarkets (TSE, NSE, and PTS) during this period, as stock prices rose, the balance gradually
decreased, mainly due to profit-taking sales, from the 2.17 trillion yen range at the beginning of
the period, to fall to the 1.96 trillion yen range on May 19th, its bottom for the period. However,the balance subsequently increased due to expectations for a rise in stock prices, reaching its
peak for the period in the 2.84 trillion yen range on March 15th, and closed at 2.70 trillion range
at the end of March. Meanwhile, the standardized margin trading sales balance increased fromthe 530 billion yen range at the beginning of the period to reach its peak for the period in the 780
billion yen range on May 19th. However, the balance subsequently decreased, reaching its bottom
for the period in the 510 billion yen range on October 6th. Thereafter, as the stock price rose, thebalance rallied again and closed at 690 billion yen range at the end of March.

11

(Company's initiatives for FY2023 (fiscal year ended March 31, 2024))
1. Analysis of the Current Situation
Under the Seventh Medium-Term Management Plan, JSF, in its capacity as a TSE Prime-listedcompany that supports the infrastructure of securities and financial markets, set a management
goal of achieving an ROE of 5% by the end of FY2025, while strengthening its corporate
governance. Additionally, JSF has focused management efforts on increasing its earning power
and improving its capital efficiency.
As a result of the efforts directed towards the achievement of these goals, we achieved an
ROE of 5.73% in FY2023, two years ahead of our target.
In addition, the market’s evaluation of JSF’s corporate value has steadily improved, with theprice to book ratio (PBR) recently hovering around 1.0. Our total shareholder return (TSR) has
also consistently outperformed the TOPIX index by a significant margin.
JSF determines its cost of equity, which serves as the basis for the setting targets andevaluation of performance as mentioned above, by referencing multiple methods that employ
objective, long-term chronological data. Our fundamental understanding is that our cost of equity
remains in the mid-4% range, even when taking into account the current market environment,
JSF is licensed as a securities finance company, and as such it is legally required to maintainfinancial soundness, and is restricted in its scope of its operations. As a result, our financial andbusiness strategy risks are relatively low, and we believe this to be reflected in our risk premium.
We therefore believe our cost of equity is at its natural level.

12

13

2. Efforts in FY2023(1) Formulation and Announcement of the Long-Term Management Vision(i) Long-Term Management Vision In November 2023, JSF formulated and announced its Long-Term Management Vision. The
decision to do so was influenced by the Board of Directors’ recognition that it was theappropriate time to rethink our future management strategy given that we expected to achieve
our goal of 5% ROE two years ahead of schedule in FY2023,—an indicator that JSF hadreached a turning point after achieving positive outcomes from its management initiatives.
After repeated discussions, the Board resolved that it would be appropriate to establish andrelease a two-tiered structure that gave consideration to future management by (i) defining along-term vision for JSF management, and (ii) formulating a medium-term management plan(based on specific business strategies) and a shareholder return policy based on this longterm vision.
 Our Long-Term Management Vision expresses JSF’s targeted vision of the future and its
ideals over the long term. First, regarding our vision of the future, we have reaffirmed that asJapan’s only securities finance company supporting the infrastructure functions of the
securities and financial markets, JSF will continue to aim to be a distinct and unique company,
with a high degree of agility and flexibility, that achieves sustainable growth and enhances its
corporate value, while maintaining strong financial soundness, through its contributions to
the development of securities and financial markets.
 Next, we established a new corporate message: “Be unique. Be a pioneer.” This expresses
what we want to be—a company that, as Japan’s only securities finance company, is capableof agilely and flexibly addressing the trading needs of participants in the securities andfinancial markets, while incorporating advances in financial technology in an ever-changing
environment to pioneer the future of both the markets and JSF.
Corporate message

Be unique. Be a pioneer.
 The direction of our long-term management is as follows: JSF will continue to address the trading needs of participants in the securities and financial
markets in an agile and flexible manner. Through its contributions to market development,
JSF will seek to concentrate the collective efforts of its Group companies to sustain growthand enhance its corporate value, while maintaining strong financial soundness.
 JSF will continue to steadily strengthen its earnings base and to seek the stable and steady
improvement of its capital efficiency, while remaining mindful of the cost of equity, and willcontinue to work toward the steady improvement of ROE, keeping the 8% level in mind.
 With regard to shareholder returns, JSF will maintain a total payout ratio of 100%
throughout the duration of its Seventh Medium-Term Management Plan, and will strive toenhance shareholder returns thereafter as well.
 Through these management efforts, JSF aims to establish a market valuation with a PBR
exceeding 1.0.
 Under its organizational design as a company with a Nominating Committee, etc., JSF will
strive to strengthen its corporate governance by tackling sustainability issues while
focusing on the further improvement of the effectiveness of deliberations by its Board of
Directors and its respective committees, the further enhancement of information
disclosure, and the development of a robust human capital base.

14

(ii) Revision of Management Goals under the Seventh Medium-Term Management Plan In light of the Long-Term Management Vision, as well as performance in FY2023, JSF has
upwardly revised the management goals for the Seventh Medium-Term Management Plan,as follows.
ROE
Maintain at a stable level above 5% and aim for further improvement.
Consolidated ordinary profit
Maintain at a stable level of over 10 billion yen and aim for further improvement.
In conjunction with the abovementioned revisions, only necessary changes have been madeto the reference values for share-based compensation, which are based on our projected
progress toward achieving goals. No changes have been made to the basic structure ofreference indicators or the method of reflection in officers’ bonuses and share-based
compensation.
(iii) Shareholder Return Policy during the Period of the Seventh Medium-Term ManagementPlan With respect to shareholder returns, we have formulated a Shareholder Return Policy for the
Period of the Seventh Medium-Term Management Plan that is in line with the Long-Term
Management Vision.Specifically, from the viewpoint of the further enhancement of returns,
JSF will continue to aim for a total payout ratio of 100% on a cumulative basis for the threeyear period from FY2023 through FY2025, through the payment of dividends and flexible
implementation of share buybacks. With regard to dividends, our policy for FY2024 throughFY2025 is to actively pay dividends, aiming for a target payout ratio of 70%.
(2) Other Efforts(i) Enhanced Information Disclosure (Revision of Integrated Reports)
 We are actively enhancing information disclosure in an effort to provide shareholders andvarious other stakeholders with a deeper understanding of JSF. This includes the productionof integrated reports, starting from FY2022. The integrated reports cover matters including
our business model, management policy, corporate governance, and sustainability initiatives.
 In the integrated report for FY2023, we enhanced reporting on the abovementioned LongTerm Management Vision, the background and reasoning behind our deliberations, and the
newly formulated corporate message in an effort to gain broader understanding andrecognition. We also reported on our Human Capital Policy, which is one of the key measures
under the Seventh Medium-Term Management Plan.
 Furthermore, since the publication of the FY2022 report, we have endeavored to enhancecontent based on the opinions we have received from our stakeholders. Specifically, withregard to corporate governance, we have published our approach to the appointment ofmanagement executives and our internal human resources development policy, providing
not only procedural information on the selection of our management team, but also
information on the specific functions of the Board of Directors and Nominating Committee,
both of which primarily comprised of outside directors, in the actual nomination process. In
addition, we have provided explanations on special features related to the details of ouroperations, the initiatives we are focusing on, and risk management regarding the securities
finance business that has driven our growth in recent years.

15

(ii) Clarifying the Responsibilities of Executive Officers
 As a company with a Nominating Committee, etc., JSF is structured so that its executive
officers execute business under the leadership and direction of the Representative Executive
Officer & President and under the highly effective supervision of the Board of Directors, basedon the management policies formulated by a Board of Directors which is primarily comprisedof outside directors.
 In order to explain the duties of executive officers in a way that is easier for all stakeholders
to understand, we have restated and disclosed the duties of each executive officer, as
reflected in the discussions by the Nominating Committee for the selection of executive
officers and corporate officers in FY2024.
(iii) Company Stock Incentive Program As in FY2022, we will continue to grant employees JSF stock in FY2023, based on overallbusiness performance, through the Company’s stock incentive program. The granting ofshares is scheduled to take place around June 2024. The purpose of the Company’s stockincentive program is to raise the motivation of employees for the achievement ofmanagement goals, and to enhance their job satisfaction and their interest in the
improvement of corporate value by providing them with an opportunity to own JSF shares.
The program aims to enhance our medium- to long-term corporate value by promoting thesharing of value among all shareholders.
(iv) Efforts to Address Sustainability Issues
 We also take a proactive approach to key issues related to sustainability. The two main efforts
in FY2023 were as follows.
Empirical Research on Securities Finance Transactions Using Distributed Ledger
Technology
 JSF and the Graduate School of Engineering of the University of Tokyo (University of Tokyo)
have been engaged in empirical research since April 2021 to explore the feasibility of using
distributed ledger technology to facilitate transactions involving tokenized securities orcollateral in repo transactions and securities lending and borrowing transactions. The twoparties released a report* on the results of this research on May 30, 2023.
* Published on JSF’s website
 We expect the findings of this research to be utilized for social implementation into a numberof fields in the future, including the securities industry. In addition, we believe that thisresearch, through an industry-academia collaboration, has provided positive outcomes that
address important sustainability issues recognized by JSF, in particular with regard to thepromotion of academic research activities and contributions to the infrastructure of securities
and financial markets.
Cooperative Relationships with Indonesia’s Securities Market
 JSF is advancing activities that contribute to and support the infrastructure of overseas
securities and financial markets, which are key issues in the realization of a sustainable
society. As a specific initiative, we are collaborating internationally with the Indonesian
securities industry.
 Drawing on our position of supporting the infrastructure of Japan’s securities and financial
markets, we have provided securities-related organizations in Indonesia with administrativeand management related expertise in lending and borrowing operations. We have also
conducted numerous briefings on the critical role of securities finance in market revitalization,

16

with the aim of contributing to the establishment of a securities finance company in Indonesia.
Following the establishment of PT Pendanaan Efek Indonesia (PEI) at the end of 2016, wehave continued to provide practical support in such areas as risk management and financing.
We invested in PEI in August 2020, and began receiving dividends from 2022.
 Currently, we are actively contributing to discussions regarding PEI’s management policies
and business operations through participation in an advisory committee and the general
meeting of shareholders comprised of JSF and other shareholders such as the Indonesia
Stock Exchange Group and PEI. From time to time, we also hold seminars in Jakarta andTokyo directed at the Indonesian securities industry, including supervisory authorities, stock
exchange personnel, and securities companies.
 Going forward, we will make greater use of the knowledge we have accumulated in the
securities finance business to contribute to the sustainable development of Indonesia’s
economy as well as its financial and securities markets.

17

(Financial results for FY2023 (fiscal year ended March 31, 2024))
Unit: millions of yen

FY2022

FY2023

Amount of
ChangePercentage of
ChangeOperating revenues

42,51850,0087,489

17.6 %

Operating expenses

28,76532,6153,850

13.4 %

General andadministrative expenses

7,398

7,463

65

0.9 %

Operating profit

6,354

9,928

3,574

56.2 %

Ordinary profit

7,601

11,0243,423

45.0 %

Profit attributable toowners of parent

5,966

8,030

2,063

34.6 %In the current consolidated cumulative period, our Group posted an increase in consolidated
operating revenue to 50,008 million yen (up 17.6% year-on-year), an increase in consolidated
operating profits to 9,928 million yen (up 56.2% year-on-year), and an increase in consolidated
ordinary profits to 11,024 million yen (up 45.0% year-on-year), due to an increase in margintransaction balances for both loans and securities lending, and has continued to enjoy strong
performance in securities financing business, mainly in Bond repo and gensaki transactions andequity repo transactions. Although the profit attributable to owners of parent for the quarter did
not include the special profit that accompanied a change to the retirement benefit system recordedin the previous period, it still increased to 8,030 million yen (up 34.6% year-on-year).

18

(Operating Conditions by Business Segment)◆ Securities Finance Business
Operating revenues for securities financing services reached 46,049 million yen (up 19.3%
year-on-year).
・Margin Loan Business
Operating revenues for margin transactions business reached 11,581 million yen (up 44.7%
year-on-year). With an increase in margin transaction balances, and with loan balances
averaging 286.9 billion yen during the period (an increase of 32.2 billion yen year-on-year) andsecurities lending balances averaging 252.4 billion yen during the period (an increase of 63.4
billion yen year-on-year), both interest on loans and securities lending fees increased, resulting
in increased revenues.
FY2022

FY2023

Margin Loan

254.7

286.9

32.2

12.7 %

Stock Loan

188.9

252.4

63.4

33.6 %

Amount of
ChangePercentage of
ChangeAmount of Average (billion yen)・Securities Financing Business
Operating revenues for the securities financing business reached 28,360 million yen (up29.2% year-on-year). Among these, bond repo and gensaki transactions (24,593 million yen,
up 29.9% year-on-year) increased significantly, reaching their highest point on record due tocontinued strong transactional needs arising from tight supply and demand for government
bonds. Equity repo transactions and the like (1,799 million yen, up 17.6% year-on-year)
increased as balances remained at high levels. General stock lending (1,083 million yen, up
35.6% year-on-year) and loans for negotiable margin transactions (250 million yen, up 67.8%
year-on-year) increased due to the high level of outstanding balances accompanying the robust
stock market. Retail loans (633 million yen, up 16.3% year-on-year) increased due to the robust
stock market and increased balances as the result of successful improvements in productquality.
・OtherOther revenues came in at 6,107 million yen (down 29.3% year-on-year). This was due to a
decline in profits from the sale of government bonds held as part of the portfolio replacement
carried out in the previous period in our securities investment business, which was conductedfrom a standpoint of securing liquidity and strengthening the revenue base for our margintransaction business and securities financing business. However, operating expenses also
decreased due to a decline in losses from the sale of foreign bonds held.
◆ Trust and Banking Business
Operating revenues for our trust banking business came in at 3,127 million yen (up 0.4% yearon-year). Custodian type trust services continued to perform well and trust fees increased.
◆ Real Estate Leasing Business
Operating revenues for our real estate leasing business reached 831 million yen (up 2.9%
year-on-year).

19

(2) Issues to be addressed(Long-Term Management Vision)
In November 2023, JSF formulated and announced its Long-Term Management Vision. The
decision to do so was influenced by the Board of Directors’ recognition that it was the appropriate
time to rethink our future management strategy given that JSF expected to achieve its goal of
5% ROE two years ahead of schedule in FY2023—an indicator that JSF had reached a turning
point after achieving positive outcomes from its management initiatives.
JSF will continue to address the trading needs of participants in the securities and financial
markets in an agile and flexible manner. Through its contributions to market development, JSF
will seek to concentrate the collective efforts of its Group companies to sustain growth andenhance its corporate value, while maintaining strong financial soundness.
In addition, JSF will continue to steadily strengthen its earnings base and to seek stable andsteady improvement of its capital efficiency, while remaining mindful of the cost of equity, and willcontinue to work toward the steady improvement of ROE, keeping the 8% level in mind. With
regard to shareholder returns, JSF will maintain a total payout ratio of 100% throughout the
duration of its Seventh Medium-Term Management Plan, and strive to enhance shareholder
returns thereafter as well.
Through these management efforts, JSF aims to establish a market valuation with a PBR
exceeding 1.0.
Under its organizational design as a company with a Nominating Committee, etc., JSF will
strive to strengthen its corporate governance by tackling sustainability issues while focusing on
the further improvement of the effectiveness of deliberations by its Board of Directors and its
respective committees, the further enhancement of information disclosure, and the developmentof a robust human capital base.
(The Seventh Medium-Term Management Plan and Shareholder Return Policy)
In light of the Long-Term Management Vision and its performance in FY2023, JSF has
upwardly revised the management goals for the Seventh Medium-Term Management Plan as
follows. With respect to shareholder ROE, JSF will maintain a stable level above 5% and aim forfurther improvement. With respect to consolidated ordinary profit, JSF will maintain a stable levelof over 10 billion yen and aim for further improvement.
In order to achieve these management goals, we will continue to focus on strengthening ourrevenue base, particularly in securities financing centered on loans for margin transactions. We
will also work to strengthen the internal management systems that support these operations. For
example, we are strengthening the foundation of human resources, which is the source ofcorporate value creation. We will steadily implement a human resource development program
under our human capital policy established in March 2023.
In addition, we are enhancing information disclosure in an effort to provide shareholders andvarious other stakeholders with a deeper understanding of JSF.
With respect to shareholder returns, we will continue to aim for a total payout ratio of 100% on
a cumulative basis through FY2025, through the payment of dividends and the flexible
implementation of share buy-backs. With regard to dividends, our policy for FY2024 throughFY2025 is to actively pay dividends, aiming for a target payout ratio of 70%.
In FY2024, a certain extraordinary profit is expected to be recorded following the sale of aproperty owned by the Company’s subsidiary, which is scheduled to take place during the firstquarter. As this extraordinary profit is a one-off gain, separate from the process of working
towards JSF’s sustainable growth, the corresponding return to shareholders will be made in theform of a special dividend in FY2024. Consequently, the dividend forecast for FY2024 is 70 yen,
20

comprised of an ordinary dividend of 64 yen and a special dividend of 6 yen. In addition, we haveset a share buy-back limit of 1.7 million shares and an amount of 2.6 billion yen. As a result, thetotal return ratio for FY2024 will be 99.7%.
As Japan’s only securities finance company supporting the infrastructure functions of
securities and financial markets, we will continue working to maintain our position as a distinct
and unique company that operates with a high degree of agility and flexibility. Our goal is toachieve sustainable growth and enhance corporate value, while maintaining strong financial
soundness and contributing to the development of securities and financial markets.
We would like to ask our shareholders and other stakeholders for their sincere understandingof our efforts and for their continued support and cooperation.
(Nine Strategies and Two Goals of the Seventh Medium-term Management Plan)21

(3) Changes in Financial Position and Results of Operations（Consolidated Basis）(

FY2020From April 1, 2020
to March 31, 2021

) (FY2021
From April 1, 2021
to March 31, 2022

) (FY2022
From April 1, 2022
to March 31, 2023

) (FY2023
From April 1, 2023
to March 31, 2024

Operating revenues(mil yen)

30,92430,13842,51850,008

Ordinary profit(mil yen)

5,558

7,164

7,601

11,024

Profit attributableto owners of parent(mil yen)

3,971

5,174

5,966

8,030

(yen)

43.28

56.61

67.76

94.04

(mil yen)

135,166

137,996

135,728

144,606(yen)

1,473.24

1,545.03

1,574.64

1,725.62

Net income per share
Net assets
Net assets per share)(4) Main Businesses（As of March 31, 2024）
JSF group engages in the following businesses, including the lending and borrowing business,and is licensed under the Financial Instruments and Exchange Law.
① Securities Finance BusinessMargin Loan Business
Loan of funds and stock certificates to securities companies, as required for the standardized margin transactions
conducted on all stock exchange markets and on proprietary trading systems (PTS)
Securities Financing Business
Loans for Negotiable Margin
Transactions
Equity repo transactions

Retail loans

Lending of the funds required in the settlement of negotiable margintransactions.
Lending of the funds required by securities companies using stocks andother securities as collateral. Cash is deposited in exchange forborrowing stock certificates held by financial institutions.
Loan of funds to individual investors and others using stocks and othersecurities as collateral. The core service in this business is COM-STOCK
loans (securities-backed loans that can be transacted online).

General stock lending

Lending of stocks procured from institutional investors to securities
companies as required in trading.

Bond repo andgensaki transactions

Intermediation of government bond repo and gensaki transactions(transactions in which bonds are exchanged for cash).

Securities Investment Business② Other
Trust and Banking Business

Trust service and banking services

Real Estate Leasing Business

Real estate leasing(5) Business Offices（As of March 31, 2024）① JSF
Head Office

1-2-10 Nihonbashi-Kayabacho, Chuo-ku, Tokyo

Osaka branch

1-9-6 Edobori, nishi-ku, Osaka② Subsidiary Companies
JSF Trust and Banking Co., Ltd. 1-2-4 Nihonbashi-Kayabacho, Chuo-ku, Tokyo
Nihon Building Co., Ltd.

1-2-14 Nihonbashi-Kayabacho, Chuo-ku, Tokyo(6) Capital Investment
22

Capital investments totaling ¥0.1 bn were made during the consolidated fiscal year underreview.
These investments arose from modifications to our core system.
(7) Employees of the Group（As of March 31, 2024）① JSF group
Segment

The number of employees

Year on Year

Securities Finance Business

212［6］+1［+2］

Trust and Banking Business

43［1］

+1

［―］

Real Estate Leasing Business

16［0］

+1

［―］

271［7］

+3

［+2］

Total

(Note) 1. The number of employees is the number of employed people (excluding those seconded from our group to outside our group)and does not include executive officers. In addition, the average number of temporary employees per year is shown separately
in brackets [ ].
2. Temporary employees include temporary staff and part-time employees.

② JSF
The number of
employees
212［6］

Year on Year

Average age+1［+2］

44.5

Average employment
longevity
20.8(Note) 1. The number of employees is the number of employed people (excluding those seconded from our group to outside our group)and does not include executive officers. In addition, the average number of temporary employees per year is shown separately
in brackets [ ].
2. Temporary employees include temporary staff and part-time employees.

(8) Subsidiary Companies（As of March 31, 2024）
Name
JSF Trust and Banking Co., Ltd.
Nihon Building Co., Ltd.

Capital Stock（billion yen）
14

Investment
Ratio（%）
100

Trust and Banking Business

0.1

100

Real Estate Leasing Business(Notes) 1. Affiliated companies are as follows:· Japan Information Processing Service Co., Ltd.
· JSF Information Technology Co., Ltd.
2. No subsidiaries are specified wholly owned subsidiaries.

(9) Major Borrowings（As of March 31, 2024）
Disclosure is omitted because the amount of borrowings is immaterial.

23

Principal BusinessⅡ Matters Concerning Shares of the Company （As of March 31, 2024）(1) Total number of authorized shares

200,000,000 shares(2) Number of issued and outstanding shares

88,000,000 shares(3) Number of shareholders

11,557 persons(4) Major Shareholders（Top 10）
Number of Shares Held Shareholding Ratio

Name（t1000 shares）（%）

THE SFP VALUE REALIZATION MASTER FUND LTD．

13,406

15.8

The Master Trust Bank of Japan, Ltd. (Trust account)

9,365

11.1

4,821

5.7

Capital Market Promotion Foundation

4,654

5.5

Mizuho Bank, Ltd.

3,536

4.2

2,640

3.1

Custody Bank of Japan, Ltd. (Trust account)

2,388

2.8

STATE STREET BANK WEST CLIENT – TREATY 505234

1,606

1.9

BNYM AS AGT/CLTS 10 PERCENT

1,575

1.9

JAPAN SECURITIES AGENTS, LTD.

1,460

1.7

THE CHASE MANHATTAN BANK, N.A. LONDON SPECIALOMNIBUS SECS LENDING ACCOUNTINTERTRUST TRUSTEES(CAYMAN) LIMITED SOLELY IN ITSCAPACITY AS TRUSTEE OF JAPAN-UP(Note) In addition to the foregoing, 3,245,689 shares of treasury stock are held by the Company as of March 31, 2024. The treasury
stock is excluded in the calculation of the shareholding ratio.

(5) Status of shares issued to the Company's officers as compensation
for the execution of their duties during the current fiscal year

Number of shares
Executive officer

Number of persons issued
shares69,600 shares(Note) The Company delivers shares of the Company's stock upon retirement through a Board Benefit Trust mechanism.

24

1 personⅢ Matter related to the director of the company(1) Directors（As of March 31, 2024）
Classification

Name

Position

Naotaka Obata

Nominating Committee Member(Chairperson)
Compensation committee
Member (Chairperson)

Shoko Sugino

Nominating Committee Member
Audit Committee Member(Chairperson)
Compensation committee
MemberKensuke Futagoishi

Nominating Committee Member
Compensation committee
MemberDirector
Chairperson of theBoard of Directors

Director

Director

Director

Director

Director

Partner Attorney at Fujibayashi Law
OfficeAudit & Supervisory Board Member ofTakeei Corporation
Outside Director of Janome
Corporation

Nominating Committee Member
Audit Committee Member

Representative Partner of Business
Producer LLC
Outside Director of Akatsuki Securities,
Inc.
Outside Director of FP Corporation

Setsuko Egami

Compensation committee
MemberProfessor Emeritus, Musashi
University
Outside Director of Resona Holdings,
Inc.

Shigeki Kushida

Nominating Committee Member
Compensation committee
MemberDirector of JSF Trust and Banking Co.,Ltd.
Outside Director of Denso Corp.

Hiroshi Asakura

Audit Committee Member

Takayoshi Yamakawa

Director(Representative
Executive Officer &President)

Significant concurrent positions(Note)1. Five directors, Mr. Naotaka Obata, Ms. Shoko Sugino, Mr. Kensuke Futagoishi, Mr. Takayoshi Yamakawa and Ms. Setsuko Egami are outside
directors.
2. The Company does not appoint a full-time Audit Committee member because the appointed Audit Committee members and their assistants attend
important meetings, review all important resolution documents, etc., and ensure the effectiveness of audits through cooperation and exchange of
information with the accounting auditors, the internal audit department and the auditors at subsidiaries.
3. The Company has designated outside directors, Mr. Naotaka Obata, Ms. Shoko Sugino, Mr. Mr. Kensuke Futagoishi, Mr. Takayoshi Yamakawa and
Ms. Setsuko Egami as Independent Officers pursuant to the rules of the Tokyo Stock Exchange, Inc., and has notified the Tokyo Stock Exchange,
Inc. to that effect.
4. Pursuant to the provisions of Article 427, Paragraph 1 of the Companies Act, the Company has entered into Limited Liability Agreements withdirectors (excluding executive directors, etc.) under Article 423, paragraph (1) of the Companies Act. The maximum amount of liability for damages
under such agreement is the minimum liability amount stipulated in the Companies Act.
5. There exists no personal, capital, business or other interest of note with other companies where outside directors concurrently serve or have served
as officers.
6. The Company has concluded a Directors' and Officers' Liability Insurance Policy as stipulated in Article 430-3, paragraph (1) of the Companies Act,
insuring its directors, executive officers, corporate officers, and other important employees, as well as the officers at its subsidiaries. The insurance
premiums, including the rider portion, are borne entirely by the company, and there is effectively no insurance premium burden on the insured.
Damages in cases where the insured officers are liable for the execution of their duties, etc., or where the insured officers are subject to claims forsuch liabilities (compensation for damages and litigation expenses) are covered under this insurance policy. However, there are certain exclusionsof liability, such as damages arising from an act committed with knowledge that the act is in violation of laws and regulations. The insurance policy
has a deductible, and damages up to the amount of that deductible are not covered.

25

(2) Attendance at meetings
Name

Board of Directors

Nominating Committee

Audit Committee

Compensation Committee

Naotaka Obata

12/12（100％）

11/11（100％）―8/8（100％）

Shoko Sugino

12/12（100％）

11/11（100％）

12/12（100％）8/8（100％）

Kensuke Futagoishi

10/12（83％）

9/11（82％）―

6/8（75％）

Takayoshi Yamakawa

12/12（100％）

8/8 (100%)

12/12（100％）

3/3（100％）

Setsuko Egami

8/9（89％）――4/5（80％）

Shigeki Kushida

12/12（100％）

11/11（100％）―8/8（100％）

Hiroshi Asakura

12/12（100％）―

12/12（100％）―(Note) Attendance at the meetings of the Board of Directors and Committees held during their term of office.

(3) Status of primary activities of outside officers
Name

Status of activities and overview of duties performed with respect to the role expected of outside Directors

Naotaka Obata

Naotaka Obata draws on his extensive experience and broad insight as a manager of major financial
institutions to sufficiently fulfill the roles and responsibilities required of an outside Director, including
effective supervision over the Company's management, determination of medium- to long-term
management policies, and advice on overall management. At meetings of the Board of Directors, as
Chairman, he manages the agenda and makes proposals and provides advice on the Long-termManagement Vision, our efforts in investor relations, and risk management systems. At Nominating
Committee and Compensation Committee meetings, he manages the proceedings as the chairperson,and expresses necessary opinions as a member in the review and deliberation of management selectionplans, the composition of the Board of Directors, and other matters.

Shoko Sugino

Shoko Sugino draws on her extensive experience and broad insight as an attorney to sufficiently fulfill theroles and responsibilities required of an outside Director, including effective supervision over theCompany's management, determination of medium- to long-term management policies, and advice on
overall management. At meetings of the Board of Directors, she makes proposals and provides advice on
the Long-term Management Vision and our efforts in sustainability. At the Nominating Committee andCompensation Committee, as a member she expresses necessary opinions in the review anddeliberation of management selection plans, the composition of the Board of Directors, and othermatters. In addition, at the Audit Committee, she manages the proceedings as chairperson, and drafts
audit plans, interviews the accounting auditor regarding the status of the audits and the results thereof,and expresses her opinions as necessary.

Kensuke Futagoishi

Kensuke Futagoishi draws on his extensive experience and broad insight in the management of financial
institutions with unique and cutting-edge business models to sufficiently fulfill the roles andresponsibilities required of an outside Director, including effective supervision over the Company's
management, determination of medium- to long-term management policies, and advice on overallmanagement. At meetings of the Board of Directors, he provides advice on the Long-term Management
Vision, the implementation status of the Medium-term Management Plan and risk management systems.
At the Nominating Committee and Compensation Committee, as a member he expresses necessary
opinions in the review and deliberation of management selection plans, the composition of the Board of
Directors, and other matters.

Takayoshi Yamakawa

Takayoshi Yamakawa draws on his extensive experience and broad insight into trends in technologicalinnovation and corporate management related to digital transformation, etc. to sufficiently fulfill the roles
and responsibilities required of an outside Director, including effective supervision over the Company's
management, determination of medium- to long-term management policies, and advice on overallmanagement. At meetings of the Board of Directors, he provides advice on the Long-term Management
Vision and our efforts in investor relations and sustainability. At the Nominating Committee, as a member
he expresses necessary opinions in the review and deliberation of management selection plans, thecomposition of the Board of Directors, and other matters. In addition, as a member of the Audit
Committee, he drafts audit plans, interviews the accounting auditor regarding the status of the audits andthe results thereof, and expresses his opinions as necessary.

Setsuko Egami

Setsuko Egami draws on extensive knowledge and broad insight on human resource development, risk
management, and corporate management to sufficiently fulfill the roles and responsibilities required of an
outside Director, including effective supervision over the Company's management, determination of
medium- to long-term management policies, and advice on overall management. At meetings of theBoard of Directors, she provides advice on the Long-term Management Vision, the implementation statusof the Medium-term Management Plan, and our efforts in investor relations. At the Compensation
Committee, as a member she expresses necessary opinions in the review and deliberation ofcomposition of the Board of Directors.

26

(4) Executive Officers （As of March 31, 2024）
Position

Responsibilities

Significant concurrent positions

Eizo Kobayashi

Assisting and supporting President
in general management, primarily inexternal affairs.

Director of Nihon building Co., Ltd.
Director of Japan Information
Processing Service Co., Ltd.
Outside Director of Tokyo Metro
Co., Ltd.

Shigeki Kushida

Directing and leading the executive
officers, as the chief executive.

Director of JSF Trust and Banking
Co., Ltd.
Outside Director of Denso Corp.

Senior Managing
Executive Officer

Yutaka Okada

Corporate Governance OfficeBusiness Development Dept.
Treasury Dept.
International Relations

Senior Managing
Executive Officer

Morikuni Shimoyamada

Chairperson

Representative
Executive Officer& PresidentManaging
Executive Officer

Managing
Executive Officer
Managing
Executive Officer

Name

Margin Loan Dept.
Institutional Sales Dept.
Retail Business Dept.

Masaru Sekiguchi

Risk Management Dept.
Corporate Planning Dept.
Settlement & Custody Dept.
Information System Planning Dept.
Osaka BranchGroup Companies Relations

Shinichi Sugiyama

Internal Audit Dept.
Compliance Dept.

Wataru Sato

Commissioned General Manager of
Human Resources Dept.

(Note) 1. Shigeki Kushida, President and Representative Executive Officer, concurrently serves as a Director.
2. Masaru Sekiguchi, Managing Executive Officer, retired from his position on March 31, 2024, upon the expiration of his term of office.

【Reference】Executive Officers (as of April 1, 2024)
Position

Name

Responsibilities

Significant concurrent positions

Chairperson

Eizo Kobayashi

Assisting and supporting President
in general management, primarily inexternal affairs.

Director of Nihon building Co., Ltd.
Director of Japan Information
Processing Service Co., Ltd.
Outside Director of Tokyo Metro
Co., Ltd.

Representative
Executive
Officer &President

Shigeki Kushida

Directing and leading the executive
officers, as the chief executive.
Internal Audit Dept.

Director of JSF Trust and Banking
Co., Ltd.
Outside Director of Denso Corp.

Senior Managing
Executive Officer

Yutaka Okada

Corporate Governance OfficeBusiness Development Dept.
Treasury Dept.
International Relations

Senior Managing
Executive Officer

Morikuni Shimoyamada

Managing
Executive Officer

Shinichi Sugiyama

Margin Loan Dept.
Institutional Sales Dept.
Retail Business Dept.
Corporate Planning Dept.
Risk Management Dept.
Information System Planning Dept.
Group Companies Relations
Compliance Dept.

Managing
Executive Officer

Wataru Sato

Human Resources Dept.
Settlement & Custody Dept.
Osaka Branch27

(5) Amount of compensation for Directors and Executive Officers
Total amount of compensation by type (thousands of yen)Classification

Total amount ofcompensation, etc.
(Thousands of yen)

Performance-linked compensation, etc.
Base
compensation

Non-monetary andstock-based
compensation

Bonus

Number of
persons(persons)

69,99069,990――7

60,69060,690――

6

Executive Officers

329,310

216,960

86,10026,2507

Total

399,300

286,950

86,10026,250

Directorsof which Outside Directors(Note) 1. Directors who concurrently serve as Executive Officers are not paid compensation as directors.
2. The business performance indicator for performance-linked compensation, etc. (bonus) is the profit attributable to owners of parent of 8,030 million
yen.
3. The business performance indicators for performance-linked compensation, etc. (non-monetary and stock-based compensation) are consolidated
ROE and consolidated ordinary income of 5.73% and 11,024 million yen, respectively.

(6) Policy for determining the amount of compensation, etc. for Officers or the method for calculating
the amount of compensation, etc.
① Content of policy and method for determining the amount of compensation, etc. for officers or the method for
calculating the amount of compensation, etc.
Based on the Company's corporate philosophy and management policy, the compensation, etc. for the Company's
officers is established as a system and at a level that matches the roles and expected functions of the directors andexecutive officers from the perspective of achieving sustainable growth and enhancing corporate value over the
medium to long-term. Specifically, the Compensation Committee utilizes the following policy determined by theCompensation to determine compensation, etc. on an individual basis. The Compensation Committee has confirmedthat the method of determining the details of compensation, etc. and the details of compensation, etc. determined foreach individual director for the current fiscal year are consistent with such determination policy, and has determinedthat the details of compensation, etc. are in line with this determination policy.
[Directors]
・From the perspective of exercising supervisory function, directors receive only a fixed monthly compensation (basecompensation) and shall not receive performance-linked compensation, etc.
・Each individual director's compensation will be based on their responsibilities as a director, such as whether they
serve full-time or part-time and have been appointed as Chairperson.
・Directors who concurrently serve as executive officers will not receive compensation as directors.
[Executive Officers]
・From the standpoint of linking their compensation to the Company's business performance and stock value, executive
officers are paid a fixed monthly compensation (base compensation) as well as performance-linked officer bonuses
and stock-based compensation.
・The fixed monthly compensation (base compensation) is determined in accordance with each executive officer's
position.
・Performance-linked compensation is divided into short-term and long-term incentives, with bonuses serving as a shortterm incentive and stock-based compensation serving as a long-term incentive.
・From the standpoint of clarifying management responsibility, officers' bonuses are determined after the end of the
fiscal year in conjunction with business performance and individual evaluations in each fiscal year, and are paid within
three months after the determination thereof.
・With regard to stock-based compensation, the Company grants points determined in conjunction with medium- tolong-term performance, using a Board Benefit Trust mechanism, and delivers the Company’s shares in proportion to
the number of points at the time of retirement.

28

② Policy on determining the percentage of compensation, etc. to be paid as performance-linked compensation and nonperformance-linked compensation, etc.
The percentage of each compensation to be paid to the executive officers based on the base performance shallbe determined as follows
Performance-linked compensation
Base compensation
65％

Officer bonus

Stock-based compensation

20％

15％

③ Indicators for performance-linked compensation, reasons for selecting these indicators, and method of determining
performance-linked compensation
Among the Company's executive officers' compensation, the indicators related to officers' bonuses and stock-based
compensation, which are performance-based compensation, are as follows.
[Officer bonus]
・Officers’ bonuses are determined by multiplying the standard bonus calculation amount for each executive officer's
position by the performance-linked coefficient (bonus).
・In calculating performance-linked compensation (bonus), the Company uses the profits attributable to owners of parent
as a reference index for short-term incentives, and the ratio of change from the previous year as a coefficient.
[Stock-based compensation]
・The number of base points will be determined based on each executive officer's position.
・Stock-based compensation is determined by multiplying the base number of points by performance-linked coefficient(bonus).
・In calculating the performance-linked compensation (stock-based compensation), the Company uses the
management targets under the medium-term management plan (consolidated ROE and consolidated ordinary profit)
as reference indicators, and the compensation is determined based on the achievement of actual results relative tothe reference values in each fiscal year, from the perspective of increasing the linkage between the enhancement
medium- to long-term corporate value and shareholder profits as a long-term incentive.

Ⅳ Dividend Policy
The Company’s fundamental policy is to seek the realization of sustainable growth and enhanced corporate value
based on maintenance of strong financial soundness as the only securities finance company in Japan supporting theinfrastructure of securities market, and to provide stable long-term returns to shareholders by comprehensively taking
into consideration the revenue environment, investment plans, and the like. Based on this basic approach, JSF will
strive to further enhance shareholder returns.
JSF will aim for a total payout ratio of 100% on a cumulative basis from FY2021 through FY2025, through the payment
of dividends and the flexible implementation of share buy-backs. With regard to dividends, from FY2024 through FY2025,
JSF will actively pay dividends, aiming for a target payout ratio of 70%.
The year-end dividend for the current fiscal year has been set at ¥30 per share under a resolution of the Board of
Directors adopted at a meeting held on May 13, 2024.
Together with the interim dividend of ¥17 per share, which has already been paid, the annual dividend will reach ¥47
per share (up ¥15 from the previous fiscal year). The effective date of the year-end dividend payment (Effective Date)will be Tuesday, June 4, 2024.

29

Consolidated Financial Statements
Consolidated Balance Sheets
Account

Unit: millions of yen

Fiscal 2023

Account(As of March 31, 2024)

Liabilities
Total Current liabilities
Call money
Short-term borrowings
Current portion of long-termborrowings
Commercial papers
Securities sold under repurchaseagreements
Cash collateral received for
securities lent
Income taxes payable
Provision for bonuses
Provision for bonuses for
directors and other officers
Borrowed money from trust
account
Other
Total Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Deferred tax liabilities forland revaluation
Provision for share awards for
directors and other officers
Retirement benefit liabilities
Asset retirement obligations
Derivative liabilities
Other
Total liabilities
Net assets
Total Shareholders' equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total accumulated othercomprehensive income
Valuation difference on availablefor-sale securities

AssetsTotal Current assets
Cash and deposits

13,113,382
1,977,638

Call loans

20,000

Securities

185,801

Operating loans
Securities
purchased
underresale agreements
Cash collateral provided for
securities borrowed
Other

1,058,630
4,753,614
4,953,081
164,699

Allowance for doubtful Accounts
Total Non-current assets△83
631,383

Total property, plant and equipment

5,769

Buildings and structures, net

2,061

Tools, furniture and fixtures, net

443

Land

3,264

Intangible assets

677

Software643

Software suspense accounts

20

Other

14

Total Investments and other assets
Investment securities

624,936
583,146

Bad debts

72

Retirement benefit assets

3,226

Other

38,563

Allowance for doubtful accounts

Total assets

Deferred gains or losses
on hedges
Revaluation reserve for landRemeasurements of defined benefit
plans
Total net assets
Total liabilities and net assets△72

13,744,765

Note) Amounts less than one million yen are disregarded.

30

Fiscal 2023
(As of March 31, 2024)

13,275,805
1,864,800
92,010149,800
589,066
5,949,364
3,762,412
1,197
562
116
740,130
126,345
324,353
316,600
5,416
74
218
243
57
1,160
581
13,600,158
131,369
10,0005,181
121,036△4,847
13,236
1,214

10,369168
1,484
144,606
13,744,765

Consolidated Statement of Income

Unit: millions of yen

Fiscal 2023

Account(From April 1, 2023 to March 31, 2024)

Total operating revenues
Interest on loans receivable
Interest on securities purchased under resaleagreements
Interest income on collateral provided for securities
borrowed
Securities lending fees
Other operating revenue
Total operating expenses
Interest expenses
Interest expenses on securities sold under
repurchase agreements
Securities borrowing fees
Other operating expenses

50,0082,895
14,4003,143
17,642
11,92632,6152,452
7,514
18,986
3,662

Operating gross profit

17,392

Total general and administrative expenses

7,463

Operating profit

9,928

Total non-operating income
Interest income and dividend income
Share of profit of entities accounted for using
equity method
Gain on investments in investment partnerships
Miscellaneous income
Total non-operating expenses
Interest expenses
Commission for purchase of treasury shares
Loss on investments in investment partnerships
Miscellaneous expenses

1,124
493
556
25
48
28
0
10
17
0

Ordinary profit

11,024

Total extraordinary income
Gain on revision of retirement benefit plan

18
18

Profit before income taxes
Income taxes-current
Income taxes-deferred

11,043
3,072
△59

3,012

ProfitProfit attributable to non-controlling interests

8,030

Profit attributable to owners of parent

8,030

－

Note) Amounts less than one million yen are disregarded.

31

Consolidated Statement of Changes in Equity(From April 1, 2023 to March 31, 2024)

Unit: millions of yen

Share capital
Balance at April 1, 2023

Capital surplus

10,000Shareholders’equity
Retainedearnings

8,878

Treasury shares

Total shareholders’equity△7,655

129,925

118,702

Changes arising during the year
Cash dividends
Net income attributable to owners ofparent△2,870△2,870

8,030

8,030

Purchase of treasury share△3,802△3,802

977

87△6,532

6,532－

Disposal of treasury share
Cancelation of treasury share
Transfer from retained earnings tocapital surplus

2,825

－

△2,825

Net changes other thanshareholders’ equity－△3,697

2,334

2,807

1,444

10,0005,181

121,036△4,847

131,369

Total changes during the year
Balance at March 31, 2024

Unit: millions of yen
Accumulated other comprehensive income

Balance at April 1, 2023

Valuation
Deferreddifference on
gains or losses
available-for-saleon hedges
securities

Revaluation
reserve for landRemeasuremen
ts of defined
benefit plans

Total
accumulated
othercomprehensive
income

9,782

168

152

5,802

△4,300Total net assets

135,728

Changes arising during the year
Cash dividends△2,870Net income attributable to owners ofparent

8,030

Purchase of treasury share△3,802

Disposal of treasury share

87

Cancelation of treasury share－

Transfer from retained earnings tocapital surplus－

Net changes other thanshareholders’ equity

5,515

587

－

1,331

7,434

7,434

Total changes during the year

5,515

587

－

1,331

7,434

8,878

Balance at March 31, 2024

1,214

10,369168

1,484

13,236

144,606Note) Amounts less than one million yen are disregarded.

32

Financial Statements
Balance Sheets
Account

Unit: millions of yen

Fiscal 2023

Account(As of March 31, 2024)

Liabilities
Total Current liabilities
Call money
Short-term borrowings
Current portion of long-termborrowings
Commercial papers
Securities sold under repurchaseagreements
Cash collateral received for
securities lent
Income taxes payable
Provision for bonuses
Provision for bonuses for
directors and other officers
Cash collateral received for
margin loans
Other
Total Non-current liabilities
Long-term borrowings
Deferred tax liabilities
Deferred tax liabilities for land
revaluation
Provision for share awards for
directors and other officers
Other
Total liabilities
Net assets
Total Shareholders' equity
Share capital
Capital surplus
Capital reserve
Retained earnings
Legal retained earnings
Other Retained earnings
Reserve for dividends
Voluntary reserve
Retained earnings brought
ForwardTreasury shares

AssetsTotal Current assets
Cash and deposits

12,068,014
1,510,872

Securities

7,541

Operating loans

606,757

Margin loan

422,798

Loan to securities companies
and individual investors

84,958Other loans

99,000

Securities purchased underresale agreements

4,753,614

Cash collateral provided for
securities borrowed

5,027,216

Other

162,064△52

Allowance for doubtful accounts
Total Non-current assets

401,420

Total property, plant and equipment

1,810

Buildings and structures, net

567

Tools, furniture and fixtures, net

412

Land

830

Intangible assets

457

Software441

Software suspense accounts

2

Other

12

Total Investments and other assets

399,152

Investment securities

337,735

Shares of subsidiaries andassociates

25,538Bad debts

72

Prepaid pension costs

1,212

Other

34,665△72

Allowance for doubtful accounts

Total assets

Valuation and translation adjustments
Valuation difference on availablefor-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Total net assets

12,469,435

Total liabilities and net assets

Note) Amounts less than one million yen are disregarded.

33

Fiscal 2023
(As of March 31, 2024)

12,222,781
1,662,500
85,37050,800589,066
5,949,364
3,762,412
672
480
116
82,32539,673
117,650
112,600
3,532
74
218
1,224
12,340,431
120,224
10,0005,181
5,181
109,882
2,278
107,604
2,030
77,03028,544△4,839
8,779
1,318
7,292
168
129,00312,469,435

Statement of Income

Unit: millions of yen

Fiscal 2023

Account(From April 1, 2023 to March 31, 2024)

Total operating revenues
Interest on loans receivable
Interest on securities purchased under resaleagreements
Interest income on collateral provided for securities
borrowed
Commission income
Securities lending fees
Other operating revenue
Total operating expenses
Interest expenses
Interest expenses on securities sold under
repurchase agreements
Commission expenses
Securities borrowing fees
Other operating expenses

46,0702,858
14,4003,151
403
17,627
7,628
32,475
2,364
7,514
887
19,076
2,632

Operating gross profit

13,594

Total general and administrative expenses

6,121

Operating profit

7,473

Total non-operating income
Interest income and dividend income
Gain on investments in investment partnerships
Miscellaneous revenue
Total non-operating expenses
Commission for purchase of treasury shares
Loss on investments in investment partnerships
Miscellaneous expenses

2,625
2,553
25
46
28
10
17
0

Ordinary profit

10,070Total extraordinary income
Gain on revision of retirement benefit plan

18
18

Profit before income taxes
Income taxes-current
Income taxes-deferred

10,0882,259△56

Profit

2,203
7,885

Note) Amounts less than one million yen are disregarded.

34

Statement of Changes in Equity(From April 1, 2023 to March 31, 2024)

Unit: millions of yen
Shareholders’equity

Capital surplus

Retained earnings
Other retained earnings

Share capital

Balance at April 1,
2023

10,000Capitalreserve

Other capitalsurplus

5,181

3,697

Total
capitalsurplus

8,878

Legal
retainedearnings

Reserve fordividends

Voluntary
reserve

Retainedearnings
brought
forward

Total
Retainedearnings

2,278

2,030

77,03026,355

107,693△2,870△2,870

7,885

7,885

△2,825△2,825

Changes arising during
the year
Cash dividends
Net income
Purchase of treasury
share
Disposal of treasury
share
Cancelation oftreasury share
Transfer fromretained earnings tocapital surplus

99△6,532△6,532

2,825

2,825

Net changes otherthan shareholders'equityTotal changes during
the year－－△3,697△3,697

－

－

－

2,189

2,189

Balance at March 31,
2024

10,000

5,181

－

5,181

2,278

2,030

77,03028,544

109,882

Unit: millions of yen
Shareholders’equity
Treasuryshare
Balance at April 1,
2023△7,646

Valuation and translation adjustments

Valuation
DeferredTotal
difference on
gains orShareholders' available-forlosses
equitysaleon hedges
securities
118,925△4,442

6,922

Total
Revaluation
Valuation andreserve fortranslation
land
adjustments
168

2,647

Total
net assets

121,573

Changes arising during
the year
Cash dividends
Net income△2,870△2,870

7,885

7,885

Purchase of treasury
share△3,802△3,802△3,802

Disposal of treasury
share

77

87

87

6,532

－

－

－

－

Cancelation oftreasury share
Transfer fromretained earnings tocapital surplus
Net changes otherthan shareholders'equity

5,760

370

－

6,131

6,131

Total changes during
the year

2,807

1,299

5,760

370

－

6,131

7,430

Balance at March 31,
2024△4,839120,224

1,318

7,292

168

8,779

129,003Note) Amounts less than one million yen are disregarded.

35