TSE Code 8511
June 1, 2017

To Shareholders
President
Eizo Kobayashi
JAPAN SECURITIES FINANCE CO., LTD.
1-2-10, Nihonbashi-Kayabacho, Chuo-ku, Tokyo, JapanNOTICE OF THE 107th ORDINARY GENERAL MEETING OF SHAREHOLDERS～extract
Dear Shareholders,
You are hereby advised of the convocation of the 107th Ordinary General Meeting of Shareholders of
the Company, details of which are indicated below. We hope very much that you will be able to attend thisMeeting.
In order to exercise your rights, please review the attached reference materials, and indicate yourapproval or disapproval of the proposals on the enclosed document, then return it or vote on the Internet
site (http://www.e-sokai.jp) by 5:20 p.m. Japan Standard Time on 22nd June, 2017.
We are pleased to announce you that we participate in the ICJ voting platform, improving the voting
environment for all our shareholders. The ICJ is offering access to the world's most widely used andsophisticated electronic voting platform, Broadridge's Proxy Edge voting platform.
Details
1. Date and Time:
2. Venue:

10:00 a.m. on Friday, 23rd June, 2017

JAPAN SECURITIES FINANCE CO., LTD., Conference Room
1-2-10 Nihonbashi-Kayabacho, Chuo-ku, Tokyo, Japan

3. Agenda for the Meeting
Items to be reported:
Report 1: The 107th fiscal year (from Apr. 1, 2016 to Mar. 31, 2017)
Business Report, Consolidated Financial Statements and Report of audits of theconsolidated financial statements by the Accounting Auditor and the Board of Auditors.
Report 2:

The 107th fiscal year (from Apr. 1, 2016 to Mar. 31, 2017)
Financial Statements.

Items to be resolved:
Agenda 1: Appropriation of Retained Earnings
Agenda 2: Election of nine Directors
Agenda 3: Election of one Substitute Auditor

Note:This English version is not a legally accurate translation of the original Japanese text.

-1-

REFERENCE DOCUMENTS PERTAINING TO EXERCISE OF VOTING RIGHTS
Agenda and Reference Information

Agenda 1:

Appropriation of Retained Earnings

The Company proposes the appropriation of retained earnings in the following manner.
Year-end dividend
The Company considers the long-term, stable return of profits to shareholders to be among its mostimportant management tasks and therefore has a basic guideline of paying dividends according to results
after provisioning the capital and interval reserves that it requires as a financial institution. Concretely, Our
dividend policy is that the consolidated payout ratio, as a standard that reflects our business performance,
shall not fall below the 60% level and that we shall return profits to shareholders while taking into accountthe consolidated dividend on equity ratio.
Following the above basic policy, Company’s year-end dividends will be calculated at 10 yen per
share. Accordingly, annual dividends which include the interim dividends of 8 yen per share will becalculated at 18 yen per share.
(1) Type of dividend asset
Cash(2) Allocation of dividend assets and total amount of allocation
10 yen per share of common stock
Total amount of payout: 968,294,640 yen(3) Effective date of dividend payment
June 26, 2017-2-

Agenda 2:

Election of nine Directors

As the term of office of ten directors will expire at the conclusion of this Ordinary General Meeting of
Shareholders, the Company proposes the election of nine directors.
The candidates are as listed below.
No.

Name

1

Minoru Masubuchi

Representative Director
Chairperson

Reappointment

2

Eizo Kobayashi

Representative Director
President

Reappointment

Shunichiro Higuchi

Representative Director
Vice President
Responsibility for Audit Dept
and Compliance Dept

Reappointment

Toshihiro Oritate

Senior Managing Director
Responsibility for Business Development Dept,
Treasury Dept, Settlement & Custody Dept
and International Relations

Reappointment

3

4

5

Kenji Fukushima

6

Kazuhiro Maeda

7

8

9

Takashi Imai

Tetsuo Mae

Eiko Shinotsuka

Current Position and Duty at the Company

Managing Director
Responsibility for Margin Loan Dept,
Institutional Sales Dept, Retail Business Dept
and Information Systems Planning DeptManaging Director
Responsibility for Risk Management Dept,
Human Resources Dept,
Corporate Planning Dept and Affiliates

Attributes of the Candidate

Reappointment

Reappointment

Director

Reappointment
Candidate for
Outside Director
Candidate for
Independent Director

Director

Reappointment
Candidate for
Outside Director
Candidate for
Independent Director

Director

Reappointment
Candidate for
Outside Director
Candidate for
Independent Director(Note) No candidate has any relationship of special interest with the Company.
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No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)May. 1993 Adviser to Governor of Market Operations
Dept, Bank of Japan (BOJ)
May. 1994 Director-General of Financial and Payment
System Dept., BOJ
Jul. 1998 Executive Director of BOJ
Jul. 2002 Standing Adviser of IBM Japan, Ltd.
Jun. 2004 President of JSF
Jun. 2005 Director of JSF Trust and Banking Co., Ltd.
Jun. 2006 Director of Japan Information Processing
Service Co., Ltd.
(to the present)
Jun. 2008 Director of Nihon Building Co., Ltd. (to the present)
Jun. 2012 Chairperson of JSF(to the present)【Significant concurrent positions】
Director of Nihon Building Co., Ltd.
Director of Japan Information Processing Service Co., Ltd.
Director of Tokyo Rope Manufacturing Co., Ltd.
【Reasons for Nomination as the Candidate】
Minoru Masubuchi filled key posts such as Executive
Director of BOJ, through which he gained abundant insights
and experiences in financial and securities sector. In
addition, he has been involved in the management of thecompany as the President since 2004, as the Chairperson
since 2012. Then the Company selected him as a candidate,believing that he will contribute to its management as a
Director.

JSF owned

Reappointment

1

Minoru Masubuchi(Nov. 3, 1943)-4-

71,000No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)May. 1999 Director-General of Personnel and Corporate
Affairs Dept., BOJ
May. 2000 Director-General of Bank Examination andSurveillance Dept., BOJ
Jun. 2002 Executive Director of BOJ
May. 2006 Senior Advisor of Aflac Japan
Jul. 2007 Vice Chairman of Aflac Japan
May. 2010 Adviser of JSF
Jun. 2010 Senior Managing Director of JSF
Jun. 2012 President of JSF(to the present)【Significant concurrent positions】
Director of Shinhan Bank Japan
Director (Audit/Supervisory Committee Member) of
Fujimori Kogyo Co., Ltd.
【Reasons for Nomination as the Candidate】
Eizo Kobayashi filled key posts such as Executive Director of
BOJ, through which he gained abundant insights andexperiences in financial and securities sector. In addition, he
has been involved in the execution of our business as the
Director since 2010. Furthermore, he has been involved in
the management of the Company as the President since2012. Then the Company selected him as a candidate,believing that he will contribute to its management as a
Director.

JSF owned

Reappointment

2

Eizo Kobayashi(Sep. 8, 1948)-5-

39,000No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)Jul. 1997 Director-General of Budget Bureau, Ministry of
FinanceJul. 2000 Manager of Credit System Division, Planningand Coordination Bureau, Financial Services
Agency of Japan
Jul. 2007 Chief of Kinki Local Finance Bureau, Ministryof FinanceJul. 2008 President of Policy Research InstituteApr. 2011 Visiting
ProfessorofDepartmentof
Cross-Cultural Studies, Faculty of Policy
Studies, Chuo University
Jun. 2012 Executive Managing Director of Lifenet
Insurance Company
Jun. 2016 Vice President of JSF,
Responsibility for Audit Dept and ComplianceDept(to the present)【Reasons for Nomination as the Candidate】
Shunichiro Higuchi filled key posts such as President of
Policy Research Institute, through which he gained abundantinsights and experiences in financial and securities sector.
After his experience as an executive managing director ofLifenet Insurance Company ,he has been involved in the
management of the Company as the Vice President since2016. Then the Company selected him as a candidate,believing that he will contribute to its management as a
Director.

JSF owned

Reappointment

3

Shunichiro Higuchi(Nov. 2, 1953)

-6-

2,600

No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)Jan. 2002 General Manager of Aomori Branch, BOJ
Jul. 2006 Deputy Director-General of Personnel andCorporate Affairs Dept, BOJ
Apr. 2008 Director-General of Payment and Settlement
Systems Dept, BOJ
Nov. 2009 Director-General of Currency Issue Dept, BOJ
Jun. 2010 Director–General of Personnel and Corporate
Affairs Dept, BOJ
May. 2012 Advisor of JSF
Jun. 2012 Managing Director of JSF
Responsibility for General Affairs Dept,
Accounting Dept and Affiliates
Jun. 2013 Managing Director of JSF
Responsibility for General Affairs Dept,
Accounting Dept, Affiliates and International
RelationsJun. 2015 Managing Director of JSF
Responsibility for General Affairs Dept,
Accounting Dept, Risk Management Dept,
Affiliates and International Relations
Jun. 2016 Senior Managing Director of JSF
Responsibility for Business Development Dept,
Treasury Dept, Settlement & Custody Dept andInternational Relations(to the present)【Reasons for Nomination as the Candidate】
Toshihiro Oritate has abundant insights and experiences infinancial and securities sector, has been involved in theexecution of our business since 2012. Then the Company
selected him as a candidate, believing that he will contributeto its management as a Director.

JSF owned

Reappointment

4

Toshihiro Oritate(Dec. 6, 1957)-7-

17,100No.

Name（Date of birth）
Reappointment

5

Kenji Fukushima(Nov. 28, 1959)

Reappointment
6

Kazuhiro Maeda(Jul. 30, 1959)

Career Summary, Position and Duty

Shares of

JSF owned(Significant concurrent positions)Apr. 1982 Joined JSF
Feb. 2008 General Manager of Margin Loan Dept
Jun. 2011 Executive Officer & General Manager ofInformation Systems Planning Dept
Jun. 2015 Executive Officer & General Manager of Planning Dept
29,100Jun. 2016 Managing Director of JSF
Responsibility for Margin Loan Dept,
Institutional Sales Dept, Retail Business Dept
and Information Systems Planning Dept
(to the present)【Reasons for Nomination as the Candidate】
Kenji Fukushima has thorough knowledge of our business,has been involved in the execution of our business as an
Executive officer since 2011. Furthermore, he has been
involved in the management of the Company as the Director
since 2016. Then the Company selected him as a candidate,believing that he will contribute to its management as a
Director.
Apr. 1982 Joined JSF
Jun. 2007 General Manager of General Affairs Dept
Jun. 2011 Executive Officer & General Manager of General Affairs Dept
Jun. 2016 Managing Director of JSF
32,390
Responsibility for Risk Management Dept, Human
Resources Dept, Corporate Planning Dept andAffiliates(to the present)【Reasons for Nomination as the Candidate】
Kazuhiro Maeda has thorough knowledge of our business,has been involved in the execution of our business as an
Executive officer since 2011. Furthermore, he has been
involved in the management of the Company as the Director
since 2016. Then the Company selected him as a candidate,believing that he will contribute to its management as a
Director.

-8-

No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)Jun. 1993 President of Nippon Steel Corp.
Apr. 1998 Chairman of Nippon Steel Corp.
May. 1998 Chairman of Nippon Keidanren(Japan Business Federation)
May. 2002 Honorary Chairman of Nippon Keidanren (to the present)
Jun. 2002 Director of JSF(to the present)
Apr. 2003 Director & Senior Adviser / Honorary Chairmanof Nippon Steel Corp.
Jun. 2003 Senior Adviser (Sodanyaku) / Honorary
Chairman of Nippon Steel Corp.
Jun. 2008 Senior Adviser (Shayuu) / Honorary Chairmanof Nippon Steel Corp.
(to the present)【Significant concurrent positions】
Director of Nippon Television Holdings, Inc.
Auditor of Nippon Life Insurance Co.
Director of Tokyo Financial Exchange Inc.
【Reasons for Nomination as the Candidate】
The Company expects that Takashi Imai will provide
management supervision and advice to the Company from a
broad perspective based on his abundant knowledge andexperience in business community. The Company selected
him as a candidate based on our judgment that he would
make a contribution to the management of the Company asan Outside Director given that he meets the Criteria for
Independence of Outside Directors / Auditors set by theCompany and is in an objective position, independent of theexecutive management of the Company.
【Independence】
He is an independent director in accordance with the rule of
the Tokyo Stock Exchange Group, Inc. In the case this
proposal is approved at the General Meeting of
Shareholders, he will continue to be an independent director.

JSF owned

Reappointment
Candidate for
Outside Director
Candidate for
Independent Director

7

Takashi Imai
(Dec. 23, 1929)【Attendance at the BOD meetings】
100％
Number of meetings during
term of appointment：10
Number of attendance：10【Term of office】15 years

-9-

4,000

No.

Name
（Date of birth）
Reappointment
Candidate for
Outside Director
Candidate for
Independent Director

8

Tetsuo Mae(Jul. 25, 1945)【Attendance at the BOD meetings】
100％
Number of meetings during
term of appointment：10
Number of attendance：10【Term of office】3 years

Career Summary, Position and Duty

Shares of

JSF owned(Significant concurrent positions)Jun. 2003 Deputy President of Daiwa Securities Co., Ltd. &Executive Officer of Daiwa Securities Group Inc.
Jun. 2004 Deputy President of Daiwa Securities Co., Ltd. &Director & Corporate Executive Officer, Deputy Presidentof Daiwa Securities Group Inc.
Apr. 2008 Adviser of Daiwa Securities Co., Ltd.
Jul. 2010 Chairman of Japan Securities Dealers Association
Jul. 2011 Chairman of Japan Investor Protection Fund
6,000
Jun. 2013 Chairman of NPO-APROSIS (Association for Promoting
Securities Investment and Study)
Jul. 2013 Adviser of Daiwa Securities Co., Ltd. (to the present)
AdviserofJapan
Securities
Dealers
Association(to the present)
Jun. 2014 Director of JSF(to the present)【Reasons for Nomination as the Candidate】
The Company expects that Tetsuo Mae will provide
management supervision and advice to the Company from a
broad perspective based on his abundant knowledge andexperience in securities community. The Company selected
him as a candidate based on our judgment that he would
make a contribution to the management of the Company asan Outside Director given that he meets the Criteria for
Independence of Outside Directors / Auditors set by theCompany and is in an objective position, independent of theexecutive management of the Company.
【Independence】
He is an independent director in accordance with the rule of
the Tokyo Stock Exchange Group, Inc. In the case this
proposal is approved at the General Meeting of
Shareholders, he will continue to be an independent director.

- 10 -

No.

Name

Career Summary, Position and Duty

Shares of（Date of birth）(Significant concurrent positions)Apr. 1993 Professor at Faculty of Human Life and Environmental
Sciences of Ochanomizu University
Apr. 1998 Member of the Policy Board, Bank of Japan
Apr. 2001 Visiting Research Fellow of Japan Center for
Economic Research(to the present)
Jan. 2002 Professor at Faculty of Letters and Education of
Ochanomizu University
Jul. 2005 Outside Auditor of Sumitomo Life Insurance Co.
Mar. 2008 Emeritus professor of Ochanomizu University(to the present)
Apr. 2009 Executive Director of Japan Legal Support Center
Apr. 2010 Commissioner of the National Personnel Authority
May. 2013 Adviser of the National Personnel Authority
Jun. 2015 Director of JSF(to the present)【Significant concurrent positions】
Auditor of Komatsu Ltd.
Director of Lifenet Insurance Company【Reasons for Nomination as the Candidate】
The Company expects that Eiko Shinotsuka will provide
management supervision and advice to the Company basedon her high level of expertise and abundant experience infinance and economics. The Company selected her as a
candidate based on our judgment that she would make acontribution to the management of the Company as an
Outside Director given that she meets the Criteria for
Independence of Outside Directors / Auditors set by theCompany and is in an objective position, independent of theexecutive management of the Company.
According to the above-mentioned reasons, we made thedecision that she could adequately carry out her assignment
as one of the Company’s Outside Directors, even though she
has not been directly involved in corporate management
except for acting as an Outside Director.
【Independence】
She is an independent director in accordance with the rule of
the Tokyo Stock Exchange Group, Inc. In the case this
proposal is approved at the General Meeting of
Shareholders, she will continue to be an independent
director.

JSF owned

Reappointment
Candidate for
Outside Director
Candidate for
Independent Director

9

Eiko Shinotsuka(May. 1, 1942)【Attendance at the BOD meetings】
100％
Number of meetings during
term of appointment：10
Number of attendance：10【Term of office】2 years- 11 -－

Agenda 3:

Election of one Substitute Auditor

At the commencement of this Ordinary General Meeting of Shareholders, the decision of the 106th
Ordinary General Meeting of Shareholders held on June 24th, 2016 to elect Masato Denawa as Substitute
Auditor will expire. Accordingly, the Company proposes the reappointment of Masato Denawa as
Substitute Auditor in order to provide for the possible case scenario in which the number of incumbent
auditors provided by laws or regulations becomes insufficient.
The candidate is as listed below.
The consent of the Board of Auditors has been obtained for this proposal.
Name(Date of birth)
Apr. 1990

Candidate for
SubstituteOutside Auditor
Candidate for
Independent
AuditorMasato Denawa(Feb. 5, 1964)

Jan. 1999
Jun. 2000
Apr. 2002
Jul. 2007
Sep. 2007
Jun. 2008
Apr. 2009
Apr. 2011

Apr. 2013

Sep. 2014
Jun. 2015

Shares ofCareer Summary
JSF owned(Significant concurrent positions)Registered Lawyer (Daiichi Tokyo Bar Association)
Joined Okinobu & Ishihara Law Office (currently,
Spring Partners)
Partner attorney at Spring Partners (to the present)
Auditor of Kinkan Co., Ltd.
(to the present)
Lecturer at Keio Univ. Faculty of Law.
Director of Advise Link Co., Ltd. (to the present)
Auditor of Japan Prime Realty Investment Corp.
(to the present)
Substitute Auditor of JSF(to the present)－
Lecturer at Keio Law School
Practicing-Attorney-Professor for Civil Advocacy
at the Legal Training and Research Institute of
the Supreme Court of Japan
Practicing-Attorney-Senior Professor for Civil
Advocacy at the Legal Training and ResearchInstitute of the Supreme Court of Japan
Lecturer at Keio Law School
Auditor of Ichikawa Co.,Ltd(to the present)【Significant concurrent positions】
Auditor of Ichikawa Co.,Ltd【Reasons for Nomination as the Candidate】
The Company asks for his election in expectation of his special
knowledge and abundant experience as a lawyer.
【Independence】
In the event of the candidate becoming elected, uponassumption of office in case that the number of incumbent
auditors provided by laws or regulations becomes insufficient,
the Company will register him with the Tokyo Stock Exchange
as an independent auditor.
(Note) The Company has no conflict of interest with a candidate.

- 12 -

（reference）

Criteria for Independence of Outside Directors / Auditors
Anyone who meets any of the following criteria, in addition to the independence criteriaprescribed by the Tokyo Stock Exchange, Inc. shall not be deemed to be independent by JSF.
１． A person who is currently:(1) Major shareholder
 A person who is a major shareholder of JSF(i.e., a shareholder who holds 10% or more of
voting rights), or, if that person is an Juridical Person, Etc., an executive director, officer, orother person engaged in the execution of business of that Juridical Person, Etc..
(2) Major Business Partners
 A person who has JSF as a major business partner (whose transactions with JSF in the lastbusiness year exceeded 2% of his consolidated gross sales in amount) , or, if that person is
an Juridical Person, Etc., an executive director, officer, or other person engaged in theexecution of business of that Juridical Person, Etc..
 A person who is a major business partner of JSF(whose transactions with JSF in the lastbusiness year exceeded 2% of JSF’s consolidated gross sales in amount) , or, if that
person is an Juridical Person, Etc., an executive director, officer, or other person engaged
in the execution of business of that Juridical Person, Etc..
(3) Specialist
 A consultant, accounting expert or legal expert who has received money or other property
from JSF more than JPY 10 million per one fiscal year, or, if that person is an Juridical
Person, Etc., an executive director, officer, or other person engaged in the execution ofbusiness of that Juridical Person, Etc..
(4) Donations
 Anyone who has received donations from JSF more than JPY 10 million per one fiscal year,
or, if that person is an Juridical Person, Etc., an executive director, officer, or other person
engaged in the execution of business of that Juridical Person, Etc..
(5) Close Relative A close relative of any person (spouse, family within the second degree) who falls under
any of (1) through (4) above
２． A person who has fallen under any item of (1) through (5) at any time within the past three
years
End

- 13 -

CONSOLIDATED BALANCE SHEETSAs of March 31, 2017

Millions of Yen

ASSETS
Current assets:
Cash
Call Loans
Short-term investments
Operating loans
Deferred tax assets
Collateral money for securities borrowed
Other current assets
Allowance for doubtful receivables
Total current assets

1,076,761
33,000238,498
587,752278
1,930,722
75,682(254)
3,942,440

Non-current assets:
Tangible non-current assets:
Buildings and structures
Tools, furniture and fixtures
Land

2,608
748
3,264
6,621

Intangible non-current assets:
Software
Software in progress
Other intangible non-current assets

4,205
114
27
4,346

Investments and other assets:
Investments in securities
In-house loan
Fixed operating claims
Other investments and other assets
Allowance for doubtful receivables

690,208
24
1,160
1,407
(1,158)691,642

Total non-current assets

702,610

Total Assets

4,645,051- 14 -

As of March 31, 2017
LIABILITIES AND NET ASSETS
Current liabilities:
Call Money
Short-term borrowings
Commercial paper
Accrued income taxes
Allowance for bonuses (Employees)
Allowance for bonuses (Directors & Executive Officers)
Collateral money received for securities lent
Borrowed money from trust account
Other current liabilities
Total current liabilities
Non-current liabilities:
Long-term Borrowings
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Allowance for officers retirement rewards
Liabilities for retirement and severance benefit
Stock benefits accrued
Asset retirement obligations
Derivative financial instruments
Other non-current liabilities
Total non-current liabilities
Total liabilities
Net assets:
Shareholders’ equity
Common stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity

Millions of Yen

626,898
13,010185,000
387
534
67
2,492,578
1,095,054
63,9084,477,440

4,000
9,410
74
41
2,941
51
50
10,680648
27,8984,505,339

10,00011,325
106,196(2,207)125,314

Accumulated other comprehensive income
Net unrealized gain on other securities
Deferred loss on hedges
Gain on revaluation of land
Accumulated amount for adjustment retirement and severance benefit
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets- 15 -

19,736(5,083)168(423)
14,397
139,712
4,645,051

CONSOLIDATED STATEMENTS OF OPERATIONS

For the year ended March 31, 2017

Millions of Yen

Operating revenues
Operating expenses

23,066
11,892

Operating profit
General and administrative expenses

11,173
8,371

Operating income

2,802

Non-operating revenues
Interest received and dividends received
Miscellaneous revenues

652
162
814

Non-operating expenses
Miscellaneous expenses

5
5
3,611

Recurring income
Extraordinary profit
Gain on sales of investment securities

63
63

Extraordinary loss
Loss on retirement of non-current assets
Loss on sales of golf club memberships

113
2
116

Income before income taxes
Income taxes
Current
Deferred

3,558
577
(97)
480

Income before minority interests
Minority interests

3,078
－

Net income

3,078- 16 -

NON-CONSOLIDATED BALANCE SHEETSAs of March 31, 2017

Millions of Yen

ASSETS
Current assets:
Cash
Short-term investments
Loan for margin transactions
Bond financing and General loans
Other loans
Deferred tax assets
Collateral money for securities borrowed
Other current assets
Allowance for doubtful receivables
Total current assets

366,639
64,540368,508
40,8722,000
248
1,947,163
68,127(146)
2,857,954

Non-current assets:
Tangible non-current assets:
Buildings and structures
Tools, furniture and fixtures
Land

2,009
474
704
830

Intangible non-current assets:
Software
Software in progress
Other intangible non-current assets

4,292
4,149
116
25

Investments and other assets:
Investments in securities
Shares in affiliates
Other investments and other assets
Allowance for doubtful receivables

553,712525,135
26,893
2,622(938)

Total non-current assets

560,015

Total Assets

3,417,969- 17 -

As of March 31, 2017
LIABILITIES AND NET ASSETS
Current liabilities:
Call Money
Short-term borrowings
Commercial paper
Accrued income taxes
Allowance for bonuses (Employees)
Allowance for bonuses (Directors & Executive Officers)
Collateral money received for margin transactions
Collateral money received for securities lent
Other current liabilities
Total current liabilities
Non-current liabilities:
Long-term Borrowings
Deferred tax liabilities
Deferred tax liabilities for land revaluation
Allowance for employees retirement benefits
Allowance for officers retirement rewards
Stock benefits accrued
Derivatives liabilities
Other non-current liabilities
Total non-current liabilities
Total liabilities
Net assets:
Shareholders’ equity
Common stock
Capital surplus
Additional paid-in capital
Other capital surplus
Retained earnings
Earned surplus reserve
Other retained earnings
Reserve for dividends
Special reserve
Retained earnings carried forward
Treasury stock
Total shareholders’ equity
Valuation and translation adjustments
Net unrealized gain on other securities
Deferred Gain or Loss on Hedges
Gain on revaluation of land
Total valuation and translation adjustments
Total net assets
Total liabilities and net assets- 18 -

Millions of Yen

584,598
1,970
185,000
154
481
67
61,8952,437,985
1,708
3,273,861

1,000
6,393
74
2,332
41
51
3,464
75
13,432
3,287,293

10,00011,3255,181
6,144
95,8892,278
93,611
2,030
77,03014,551(2,199)115,015

13,345
2,146
168
15,660130,676
3,417,969

NON-CONSOLIDATED STATEMENTS OF INCOME

For the year ended March 31, 2017

Millions of Yen

Operating revenues
Operating expenses

19,418
10,540Operating profit
General and administrative expenses

8,877
7,009

Operating income

1,868

Non-operating revenues
Interest received and dividends received
Miscellaneous revenues

711
61
773

Non-operating expenses
Miscellaneous expenses

5
5
2,636

Recurring income
Extraordinary profit－
Extraordinary loss
Loss on retirement of non-current assets
Loss on sales of golf club memberships

117
2
120

Income before income taxes
Income taxes
Current
Deferred

2,516
283
(99)
184

Net income

2,332- 19 -

With regard to the Exercise of Voting Rights via the Internet etc.
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 (http://www.e-sokai.jp). However, please note that the voting service
website is not available from a mobile which the Internet can be connected.
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 the screen to register
whether you approve or disapprove of each proposal, and are kindly requested to exercise yourvoting rights on or before 5:20 p.m. (Japan standard time) on Thursday, June 22, 2017.
③ To prevent unauthorized access by parties other than shareholders and the alteration ofshareholder votes, shareholders voting via the Internet will be asked to change their “password”
on the Voting Rights Exercise Site.
④ If you exercise your voting rights via the Internet multiple times, the vote cast last shall prevail.
⑤ Connection fees payable to the providers and communication expenses payable totelecommunication carriers when accessing the website for the exercise of voting rights will beborne by the shareholders.

2. Platform for the Electronic Exercise of Voting Rights
Management and trust banks or other nominee shareholders as well as standing proxies have thechoice of an alternative method for exercising voting rights for the Company’s General Meeting of
Shareholders. This is the Electronic Voting Platform for Institutional Investors that is operated by ICJ
Inc. to use this Electronic Voting Platform must be made in advance.

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