Japan Securities Finance Co., Ltd.
FY2022Financial Results Presentation

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～Table of Contents＜Part Ⅰ＞ Overview of Financial Results for FY2022
 １．Executive summary (Consolidated)Ｐ３

 ２．Summary Financial Results for FY2022

Ｐ４

 ３．Summary Financial Results for FY2022（JSF parent）

Ｐ５ ４．Financial Highlight（Margin Loan Business）

Ｐ６

 ５．Financial Highlight（Securities Financing）

Ｐ７

 ６．Financial Highlight（Securities Investment of JSF parent）

Ｐ８ ７．Summary Financial Results for FY2022（ JSF Trust Bank）

Ｐ９



Ｐ10

8．Estimated Figures for FY2022＜Part Ⅱ＞ Our efforts to achieve management with awarenessof our cost of capital and stock price １．Efforts to achieve management with awareness of our costof capital and stock price, etc.

P12

 ２．Status of Dialogue with Shareholders

P16

 ３．Shareholder Returns

P17

 (Appendix)

P19～41

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～2

１．Executive Summary (Consolidated)（¥ mil）

FY2022
Full YearHighlights
YoY ⊿

⊿％


Operating
Income

6,354

+119

+1.9％

Recurring
Income

7,601

+436

+6.1％

Net
Income

5,966

＋792

＋15.3％

Copyright Japan Securities Finance Co., LTD. All Rights Reserved

Increased year on year by 1.9% mainly
thanks to firm earnings from securities
financing, particularly from bond lending
and equity repo transactions.
Repositioned for future portfolio
management in response to rising interest
rates overseas. This resulted in recording
losses on sales of foreign currency bonds.

 Recorded extraordinary gains on reduction
in retirement benefit liabilities due tochange in retirement bonus structure.

～ All For Securities Market ～3

２．Summary of Financial Results for FY2022
Consolidated（¥ mil）

Non-consolidated
JSF

FY2022
Full Year

YoY.⊿

42,51812,380(+41.1%)

38,631

12,044

ExceptPremium Charges

37,806

10,501(＋38.5%)33,919

10,166

Operating Expenses

28,765

12,231(+74.0%)28,268

11,932

24,053

10,325(＋75.2%)

23,556

10,027

General &Administrative Expenses

7,398

29

(+0.4%)

5,972

Operating Income

6,354

119

(+1.9%)

Recurring Income

7,601

436

(+6.1%)

523

76(+17.2%)

671

689

5,966

792

Operating Revenues

ExceptPremium Charges

Gain or Loss inEquity-Method

Extraordinary
Profit or LossNet Income(%⊿)

JSF Trust Bank

Nihon Building

YoY.⊿

YoY.⊿

YoY.⊿

3,364

403

1,197

▲88

748

312

35

9

▲31

1,202

61

626

▲39

4,390

143

1,413

29

536

▲58

10,274

4,346

1,415

30

651

▲55

(－)

671

689

―

―

―

―

(＋15.3%)

9,302

4,762

975

▲47

429

▲35

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～4

３．Summary of Financial Results for FY2022（Non-consolidated）
Japan Securities Finance（Non-consolidated）

Key Points*Excluding premium charge（¥ mil）

FY2022
Full Year

YoY.⊿

(%⊿)

Operating
Revenues*

33,919

10,166(+42.8%)Operating Expenses*

23,556

10,027(＋74.1%)

Operating Profit

10,363111(＋1.1%)

Margin Loan
Business*

3,077

263

(＋9.4%)

Securities Financing

5,850

2,084

(＋55.4%)

Others1,434▲2,236(△60.9%)● Operating Revenues
 Securities
financingrevenues
increased on higher balances for bondlending and equity repo (+42.8%).

● Operating Profit
 Operating profit increased by ¥111
million YoY to ¥10,363 million (+1.1%).
Although based on firm earnings fromsecurities financing, income from
Others (mainly securities investment)
decreased due to the repositioning ofheld securities to enable future
portfolio management● General & Administrative Expenses

General &Administrative
Expenses

5,972

▲31

(△0.5%)

Operating Income

4,390

143

(+3.4%)

Recurring Income

10,274

4,346(＋73.3%)Extraordinary
Profit or Loss

671

689

(－)

Net Income

9,302

4,762

(＋104.9%)

Copyright Japan Securities Finance Co., LTD. All Rights Reserved From the perspective of efficient
capital allocation within our groupcompanies, dividends paid from two
consolidated subsidiaries (up ¥3,952
million YoY). As a result, nonconsolidated Net Income increased
significantly, but have no impact on
consolidated
results
becauseof
consolidation eliminations.

～ All For Securities Market ～5

４．Financial Highlights （Margin Loan Business）
Margin loan balances were slightly higher QoQ in 4Q, but remained low throughout
the year

Stock loan balanceｓ remained steady at a level higher than the previous fiscal year.
4Q‘s average balance recovered to the ¥200 billion level thanks to short sellincreased during periods of rising stock prices（\ bn）FY2021
1Q

2Q

1H

YoY

FY2022

3Q

4Q

full year

1Q

2Q

1H

3Q

4Q

full year

4Q

YTD

融資平均残高

296

286

291

288

259

283

248

256

252

253

260

254

0

▲28

貸株平均残高

181

194

188

174

150

175

156

215

185

183

200

188

49

13

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～6

５．Financial Highlights （Securities Financing）


Bond lending and equity repo benefitted from capturing diverse needs tocontinue upward trend and General Stock Lending also increased revenues
Loans for Negotiable Margin Transactions and Retail remained steady YoY(¥ mil)FY2022
Full Year

YoY⊿

130

▲5

△4.3％

 Remained slightly below the previous
year's level

1,514

335

+28.4％ Outstanding equity repo transactions
have been on increasing.

Retail

377

24

+6.9％

General Stock Lending

496

140

+39.6% General stock lending increased YoY
thanks to recovery of borrowing
demand for fail-cover.
 Both outstanding gensaki
transactions and repo transactions
have been increasing.

Type of transaction

Loans for Negotiable
Margin Transactions

Securities Financing

Loan to Securities
Companies*

Bond Lending

Total Gross Profit

YoY%

3,332

1,589

＋91.2%

5,850

2,084

＋55.4%

 The mainstay COM-STOCK Loan
remained steady.

* General Loans, stabilizing funding loan, equity repo, etc.
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～7

６．Financial Highlights （Securities Investment / Non-consolidated）


Repositioned for future portfolio management in response to rising interest rates overseas
and other changes in operating environment.

This resulted in recording gains on sales of domestic bonds and losses on sales of foreign
currency bonds.

Gains on management of market assets （JSF）

FY2022

YoY¥ 8,351 mil¥ 5,215 mil

Domestic Bonds¥ 5,955 mil¥ 4,559 mil

Stocks and Others¥ 2,395 mil¥ 655 milIn foreign currencies△¥ 6,846 mil△¥ 7,467 mil¥ 1,434 mil△¥ 2,236 mil

Yen-based

Total

Ref. Trend of Interest Rate

Changes in Investment Portfolio

Source） Bloomberg

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～8

７．Summary of Financial Results （JSF Trust Bank）

Highlights

 Custodian type trust services, particularly asset-backed loan trusts,
drove increased revenues from trust fees.
 Recurring revenues increased on growth in trust fees and having
recorded gains on sale of securities.
 Net income decreased due to an allowance for doubtful accounts andan increase in income taxes.
JSF Trust Bank
(Non-consolidated)（¥ mil）

Recurring Revenue【Trust Fees】
YoY

FY2022
Full Year

3,366(¥ mil)(%)

404(+13.6%)

Trust Fees

1,398

81

(+6.2%)

Recurring Expenses

1,951

374

(+23.7%)

Recurring Income

Net Income

1,415

30

(+2.1%)

975▲47(△4.6%)

Copyright Japan Securities Finance Co., LTD. All Rights Reserved

1,316

1,398

FY2021

FY2022～ All For Securities Market ～9

8．Estimated Figures for FY2023
Precondition

FY2023
Estimated
Figures（¥ mil）

FY2023 Estimate

YoY.⊿⊿ from prev.
EF

Consolidated
Over-lentMargin Loan
¥160bnOver-lent
Stock Loan
¥110bnMatching¥100bnMargin Loan
¥260bnStock Loan
¥210bnOperating Income

7,500＋1,145―Recurring Income

8,500

＋898

―

Net Income

6,100

＋133

―

Operating
Income5,523＋1,132―

Recurring
Income7,452▲2,822―Net Income

5,743▲3,559―Recurring
Income

1,480

＋66

―

Net Income

1,027

＋51

―

Operating
Income540＋3―

Recurring
Income645▲6―

Net Income

425

▲4

―

JSF

（Reference）
FY2022 Results
Over-lentMargin Loan
¥160bnOver-lent
Stock Loan
¥94bn

Matching¥94bn
Margin Loan
¥254bn

JSF
Trust andBanking

Stock Loan
¥188bnNihon
Building

Preconditions of Loans for Margin Transactions●Loan Rate： 0.60％,●Interest on Collateral Money： 0%,●Lending Fee： 0.40％<Approach to Estimated Figures for FY2023>
 Securities financing remains at same level, while Securities Investment revenue is expected to improve. Subsidiaries'
results are expected to be at same level with the previous fiscal year. Dividends from subsidiaries to JSF are
expected to be reduced.
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～10

Our efforts to achieve managementwith awareness of our cost of capitaland stock price

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～１．Efforts to achieve management with awarenessof our cost of capital and stock price, etc
Analysis of the current situation
 Management goal：Setting a management goal for achieving a ROE of 5% in excess of the cost of equity(mid 4% range), during the period of the Seventh Medium-term Management Plan in our Medium-termManagement Policy.

 Shareholder returns：Seek to further enhance them by striving for a total payout ratio of 100％ on a
cumulative basis in the years from FY2021 through FY2025 (achievement of 5% ROE target) through dividend
payments and agile implementation of share repurchases.

 As a result of these efforts, the Company's stock price and PBR have been on an upward
trend.

FY2018FY2019FY2020

FY2021

FY2022

ROE

2.65％

2.66％

3.03％

3.79％

4.36％

Total payout ratio

87.8％

71.0％

60.1％

97.6％

97.6％

0.38 times

0.35 times

0.54 times

0.59 times

0.64 times

PBR**PBR is the value at the end of each fiscal year.

Approach to the cost of capital

Cost of equity is estimated by objective data and multiple methods, perceived to be in the mid-4% range.

 As infrastructure for the securities market, our risk of business strategy is low and financial stabilities andearnings are high , due to financial soundness and restrictions on the scope of their business are imposedby laws and regulations and participation standards for securities and funds settlement systems.


Due to the characteristics of a securities finance company, our cost of equity is considered to beconsiderably lower than the general level.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～12

１．Efforts to achieve management with awarenessof our cost of capital and stock price, etc
Approach to improving return on capital（１）Required to maintain financial soundness and subject to legal restrictions on the scope of our business.
In light of such characteristics of the Company, it is not appropriate to take measures to rapidly increase
ROE by drastically reducing net assets, for example, due to concerns about possible infringement ofbusiness regulations and side effects such as higher financing costs, etc.



Aim to achieve a 5% ROE by FY2025.

The level of ROE has steadily increased since FY 2019, when JSF became a company with a nominationcommittee, etc., mainly due to the increased contribution to earnings from the securities financing
business.



ROE has steadily increased from 2.66% in FY2019 to 4.36% in FY2022. We arecontinuing to make progress, with a view to achieving the 5% goal by FY 2025.

Regarding PBR, it was below 1 times at 0.64 times at the end of FY2022, but it has been steadily
increasing from 0.35 times at the end of the FY2019.

 Our aggressive efforts to enhance shareholder returns, with a total payout ratioof 100% from FY2021 through FY2025, also contributed to this.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～13

１．Efforts to achieve management with awarenessof our cost of capital and stock price, etc
Approach to improving return on capital （２） Promotion of The Seventh Medium-term Management Plan（FY2023-2025）
 Continuing to accelerate and deepen our management reform efforts Further develop an efficient business operation structure to respond flexibly andagilely to changes in the business environment and striving to enhance corporate
vitality and organizational transformation through the development of humanresources and the securing of diversity.

 Continue to make management efforts to further improve our corporate value throughsustainable growth and improvement of capital efficiency in FY2026 and beyond.
Taking into consideration the financial soundness and business characteristics
required of a securities finance company.

Strive to achieve a higher ROE that will ensure a significantly larger spread than thecost of equity.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～14

１．Efforts to achieve management with awarenessof our cost of capital and stock price, etc
Approach to improving return on capital （3） Formulated “Human Capital Policies”
As our basic approach for promoting initiatives related to the formation of “human capital,”such as human resource development, with the aim of strengthening the foundation ofhuman resource capabilities, which are the source of enterprise value creation.



Vision

We respect the diverse values of our employees and will strive toprovide opportunities and supportive environments so that diverse
individuals can maximize their individuality and strengths and grow on
their own through the performance of their work.
We will promote the creation of comfortable work environments so that
employees can engage in their work with peace of mind.
We will improve our corporate vitality and organizational transformation
capability, and achieve more productive working styles by working to
improve employee engagement.

Sets forth “Our image of expectations for human resources” clarifies efforts toward
these visions, including recruitment, training and career advice, etc.

 Through the above management initiatives, JSF intends to achieve a PBR of over 1x.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～15

２．Status of dialogue between JSF and its shareholders

As a prime market listed company, JSF, based on the Corporate Governance Code, responds
to dialogues with its shareholders in a positive manner, within reasonable limits, in order tocontribute to the sustainable growth and the enhancement of corporate value over the
medium to long term.

【 Main themes, points of shareholder interest.(FY2022) 】① Initiatives and achievements to enhance corporate value and capital efficiency
 JSF explained that it has been striving to improve profitability and capital efficiency by setting a management goal for achieving a
ROE of 5% in excess of the cost of equity (mid 4% range), during the period of the Seventh Medium-term Management Plan in our
Medium-term Management Policy, and also that JSF's ROE has been steadily increasing in recent years.
 JSF received feedback from shareholders that they would like to see continued efforts to enhance corporate value after theSeventh Medium-term Management Plan period is over.
 JSF have indicated to continue our management efforts to achieve a higher ROE level in FY2026 and beyond.
（ Please refer to the press release issued on May 15, 2023 ）② Officer nomination process and governance initiatives
 Provided explanations regarding governance at JSF.
 Based on opinions from shareholders、JSF disclosed thefollowing cases that were proposed as issues raised byoutside Directors regarding the actual operational
aspects of Nominating and Remuneration Committees
and the Board of Directors led by outside Directors.

③ Information disclosure

Published its first Integrated Report
incorporating.



JSF recognize through discussions at theBoard of Directors that we need to develop
tools and systems to enhance information
disclosure We reports the status of dialogues with shareholders to the Board of Directors promptly after
each dialogue. we strive to ensure that the Board of Directors and the various committees holddiscussions that also take into account the feedback of shareholders
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～16

３． Shareholder Returns
Policy for shareholder returns
 To further enhance shareholder returns, JSF aims at cumulative total
payout ratio of 100% through dividends and the flexible implementationof share buy-backs in the period from FY2021 through FY2025
ー With regard to dividends, our aim is to aggressively pay annual dividends in the
period from FY2022 through FY2025 at a level that does not fall below theamount of JPY 30 per share

Shareholder returns in FY2023
Dividend
forecast

Full-year¥ 34(+¥2 YoY)

Total payout
ratio

Share Buy-Back

3.3mil.shares（3.8% of total number ofshares outstanding)

101.4％

JPY 330 mil.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～17Appendix
 Results of financial ratios（ROE、Total Shareholder Return) Revenue Structure of Loans for Margin Transactions

 Dividend and Share Buyback Program (Historical)

 Balance Sheet Summary （ end of Sep-2022, consolidated ） Financial Result Trends (Consolidated) About the Margin Loan Rates

 Gross Profit by Business Rate of Loans for Margin Transactions

 Breakdown of Operating Revenues by Business (Historical
Data) Securities Holdings

 Breakdown of Operating Revenues by Business Our Group Companies

 Analysis of YoY Change in Operating Revenue by Business(Quarterly) Rating Information

 Outstanding Balance of Transactions by Group Business Our Corporate Philosophy and History to Date Margin Transactions & Loans for Margin transactions
 Structure of Margin Transactions & Loans for Margin
Transactions

Copyright Japan Securities Finance Co., LTD. All Rights Reserved

 JSF Trust Bank (Loan Balance)

 ESG/SDGｓ Initiatives
 Our Business Field (image chart)～ All For Securities Market ～ Results of financial ratios（ROE、Total Shareholder Return)

ROE

Copyright Japan Securities Finance Co., LTD. All Rights Reserved

Total Shareholder Return～ All For Securities Market ～19 Dividend and Share Buyback Program (Historical)
FY
2017

FY
2018

FY
2019

FY
2020

FY
2021

FY
2022

FY2023
Forecast/
Framework¥34

Annual Dividend per share

¥26

¥22

¥22

¥26

¥30

¥32

Interim ¥17
Year-end ¥17

Share Buyback(shares)

1.5mil2.0mil1.0mil

―2.4mil3.1mil3.3mil（amount）¥0.9bn¥1.2bn¥0.5bn―¥2.3bn¥3.0bn¥3.3bnTotal Payout Ratio

58.8%

55.0%

57.2%

60.1%

97.6%

97.6%

101.4%<Consolidated> : Net Income¥4.2bn¥3.7bn¥3.5bn¥3.9bn¥5.1bn¥5.9bn¥6.1bn

：EPS

¥44.2

¥40.0

¥38.4

¥43.2

¥56.6

¥67.7

¥72.1

： DPR

58.8%

55.0%

57.2%

60.1%

53.0%

47.2%

47.1%

（reference)

Note for FY2023 (Forecast) The number of shares and the amount of the “Share Buyback“ are both subject to a repurchase limit The “Annual Dividend per share” is a forecast
 "Net income (consolidated)" refers to the estimated figure announced on May 10, 2022. Moreover, EPS and DPR havebeen calculated using this estimated figure.
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～20 Financial Result Trends (Consolidated)¥ mil
FY2017FY2018FY2019FY2020

FY2021

FY2022

26,33324,321

29,10130,92430,13842,51818,38318,603

20,84623,711

27,30537,806

13,33012,284

16,83518,018

16,53328,765

5,385

6,566

8,585

10,81913,72824,053General &Administrative Expenses

9,121

8,056

8,136

8,129

7,368

7,398

Operating Income

3,881

3,981

4,129

4,777

6,235

6,354

123

248

306

395

446

523

4,685

5,046

4,894

5,558

7,164

7,601

Extraordinary
Profit or Loss

131

▲41

▲36

43

▲17

671

Net Income

4,225

3,765

3,556

3,971

5,174

5,966

Operating Revenues
Ex Premium charges

Operating Expenses
Ex Premium charges

Gain or Loss inEquity-Method

Recurring Income

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～21 Gross Profit by Business\ mil

Operating Revenues(ex. premium charges)
FY2020Consolidated

FY2021Gross Profit

FY2022

FY2020

FY2021

FY2022

23,711

27,30537,806

12,906

13,604

13,753

Secrities Finance Business

20,33723,75333,919

9,903

10,251

10,363

Margin Loan Business(ex. Premium charges)

4,146

3,285

3,292

3,853

2,814

3,077

12,36915,391

21,976

2,876

3,766

5,850

80

156

149

53

135

130

785

1,196

1,529

669

1,179

1,514

Retail

468

510

544

323

352

377

Stock Lending

950

657

799

536

355

496

Bond Lending

10,085

12,86918,953

1,293

1,742

3,332

3,820

5,076

8,651

3,173

3,670

1,434

Trust Business

2,624

2,960

3,364

2,098

2,524

2,616

Real Estate Management Business

1,295

1,286

1,197

1,275

1,261

1,162

Securities Financing
Loans for Negotiable
Margin Transactions
Loans to Seurities
Companies

Others（mainly securities
investment）

Note）
Figures for each Group company are on a non-consolidated basis (before elimination of consolidation), and the sum ofthese figures does not correspond to the figures for “Operating Revenues (A)” and “Gross Profit (A-B)” .

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～22 Breakdown of Operating Revenues by Business(Margin Loan Business) Lending fees increased, but Margin loan balances decreased YoY, resulting inunchanged revenues when excluding premium charges for over-lent stock loans
Changes in Operating Revenues(￥：mil）

Revenue(YoY)

Full year

Quarterly

Margin Loan
Business
5,519

2,070

（ex premium
charges）

Fees onLending
Securities

3,581

8,003

(＋30.8%)  Operating revenues

3,292(+0.2%)(2,832)

1,484

5,519
(+54.1%)

4,711

Premium
Charges(+66.3%)

LendingFees(＋8.0%)(1,859)

1,113
984
606

(1,253)

1,039
(748)

925

(757)

(416)

(230)
(189)

(808)

(840)

(955)

(157)

(167)

461

406

393

112

89

103

3Q

4Q

1Q

(199)
411

FY2021

406
168

2Q

(210)

1,793

1,619

446

565

1-4Q

1-4Q

FY2021

FY2022

407

156
135

3Q

FY20224Q

for services
unchanged whenexcluding premium
charges.

(4,711)

1,113

984
877

9
8
4

Point

Copyright Japan Securities Finance Co., LTD. All Rights ReservedIntereston
LoansInterest on
collateralmoney ofsecurities
borrowed808

 Revenues fromlending fees
increased due to
YoY increased instock loan balances.

 Revenues frominterest on loans
1,619
decreased due to(△9.7%)
YoY decline in
margin loanbalances.

565(+26.6%)～ All For Securities Market ～23 Breakdown of Operating Revenues by Business(Securities Financing (1))
 Loans to securities companies resulted in an increase.
Outstanding balance of equity repo transactions contributed to the result.
Changes in Operating Revenues
Full year

Quarterly(¥ mil）

Loans for
Negotiable
MarginTransactions

149  Loan for negotiable(△4.6%)

1,529
1,196

Loans to
31

34

43

43

307

346

369

387

29

54

369

403

134

127

129

135

139

140

3Q

4Q

1Q

2Q

3Q

4Q

510

544

1-4Q

1-4Q

FY2021

FY2022

Securities

1,529

Companies(＋27.8%)Loanｓ toRetail544(+6.6%)FY2021

FY2022

Point

(YoY)

149

156

Revenuemargin transactions
decreased.
 Loans to securities
companies resulted
in an increase.
Outstanding balanceof equity repo
transactions
contributed to theresult.
 Loanｓ to retailincreased.

＜ Loan Lineup ＞
 Loans to securities companies: General loans, bon financing, loans for negotiable margin transactions,stabilizing fund loans, equity repo (cash-secured stock lending transactions) Loanｓ to retail: Com-STOCK loans
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～24 Breakdown of Operating Revenues by Business(Securities Financing (2))
 Bond lending revenues increased on growth in gensaki transaction and repo
transaction balances General stock lending increased YoY thanks to recovery of borrowing
demand for fail-cover.
Changes in Operating Revenues
Full year

Quarterly799(¥ mil）

Revenue

Point

(YoY)
295
657

18,929

214
153

255

4,846

4,564

175
183

GeneralStock
Lending

Revenues increased
799 YoY on recovery in(+21.6%) borrowing demand
for fail-cover.

Bond
Lending

Revenues increased
18,929 on growth in gensaki(＋47.3%) transaction and repo
transaction balances.

12,846

152

3,422

3,360

3Q

4Q

FY2021

4,107

1Q

2Q

3Q

FY2022

5,410

4Q

1-4Q

1-4Q

FY2021

FY2022*Genera stock lending is ・・・Lending stock to securities companies depending on their various demands (ex. fail-cover and arbitrage),
except on demand to settle margin transactions.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～25 Breakdown of Operating Revenues by Business(JSF Trust Bank) Balances for crypto asset related trusts declined due to downturn on
crypto asset market but secured increase in trust fees on continued
favorable performance of asset-backed loan trusts.
*Consolidated base

Changes in Trust Fees
Quarterly

Full year(¥ mil）

Revenue

Point

(YoY)

1,347
1,266

323

324

324

339

346

336

3Q

4Q

1Q

2Q

3Q

4Q

FY2021

FY2022

Trust
Charges
1-4Q

1-4Q

FY2021

FY2022

Asset-backed loans

1,347 driving continued(＋6.4%) increase

Trust Lineup
Trusts for the separate management ofmoney and securities

Trust for segregated deposits which securities companies receive from customers

Trusts for currency future trading

Trust for segregated guarantee deposits which FX business operators receive from
customers

Crypto-asset related trust

Trust for segregated guarantee deposits which crypt-asset exchangers receivefrom customers

Asset Backed Loan (ABL) Trust

For setting up ABL, which is an investment product for institutional investors,
JSFTB provides functions as SPC.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～26 Analysis of YoY Change in Operating Revenue by Business

Summary of the Significant Points for quarterly
Margin Loan Business【Full year】 YoY ¥ 12,380 mil（+41.1%）

 Margin loan revenues increased but revenues
unchanged when excluding premium charges
for over-lent stock loans due to a decline in
margin loan balances.

+3,567 +377
+6,082+333+1,885+33

Securities Financing Business

△33

+141

△7
42,51830,138FY2021MarginLoan

Loans for Loans for Loans for StockBond
NMT Sec Com Retail Lending Lending Securities

ー

Securities Finance Business

OthersーFY2022

Securities Financing
Trust
Bank

 Revenues from capital loans to securities
companies increased on high balances forequity repo.
 Revenues from loans to retail increased onhigher balances for COM-STOCK loans.
 General stock lending increased YoY thanks torecovery of borrowing demand for fail-cover.
 Bond Lending revenues increased on highbalances for gensaki transactions and repo
transactions.

Real
Estate Revenues increased YoY on recording gain on
sales of held securities (also recorded loss on
sales).

Trust Business Revenues increased on growth in trust fees.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～27 Outstanding Balance of Transactions by Group Business(Average Balance)￥：milTransaction TypeFY2020

FY2021

FY2022Margin Loans

224,615

283,118

254,701

Stock Loans

300,638

175,578

188,918

7,099,013

9,969,762

11,473,992

9,910

21,50918,856

327,444585,974

697,788

Retail13,092

14,993

16,759General Stock Lending

47,12647,50963,3426,701,439

9,299,775

10,677,245

571,109682,499

539,931

Securities Financing
Loans for Negotiable
Margin Transaction
Loans toSecurities Companies

Bond Lending
Trust Bank Loans

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～28

 Balance Sheet Summary （ end of Mar-2023, consolidated ）\mil
Mar-23
Total assets
Cash & Deposit
Short-term
investments
Short-term loans
receivable
Receivables
under resaleagreements
Collateral moneyof securities
borrowed
Investments insecurities

14,056,217
1,598,274
71,013
955,550
3,561,406
6,669,821

Change from
Mar-22▲ 112,438
299,204 Deposit at BOJ▲ 38,711 JGB and other bonds (Maturity: 1year or less)Margin loan / Loans for negotiable margin

64,064 transactions / General loans / Trust bank loans▲ 366,739
Collateral money of bond borrowing

170,398 Collateral money of stock borrowing

745,621▲ 296,874

Total liabilities

13,920,489▲ 110,169

Call money

2,190,400

332,000

Short-termborrowings

93,010Commercial Paper
Payables under
repurchaseagreements
Collateral money
received of
securities lent
Borrowed moneyfrom trust
account
Long-term
borrowings

Total net assets

Bank borrowing▲ 146,200 Market operation by BOJ

451,000▲ 45,000

4,781,801▲ 763,097

5,073,776
871,335

JGB and other bonds (Maturity: more than
1year), StockCollateral money of bond lending

367,279 Collateral money of stock lending▲ 160,077

232,700

228,700 Market operation by BOJ

135,728▲ 2,268

Copyright Japan Securities Finance Co., LTD. All Rights Reserved

Features of Assets
The major components of assets are
margin loans (short-term loans
receivable), deposits in current
account balance at the BOJ (cashand deposits), both of which are
subject to daily fluctuations,collateral deposited for the
procurement of securities (collateralmoney of securities
borrowed/receivables under resaleagreements), and securities held forinvestment.
Cash and cash equivalents maychange significantly depending on
the amount of standby funds in thetrust account of JSF Trust andBanking Co., Ltd. and the surplus ofcash position of the Group as awhole.

Features of Liabilities
In addition to market funding, suchas call money and commercial paper,
which can be adjusted daily in orderto address daily changes in assets,major liabilities are collateraldeposits received against lending
securities (collateral money
received of securities lent/payables
under repurchase agreements).
Ref) Capital adequacy ratio*
at the end of Mar 2023: 496％
*Based on FIEA

～ All For Securities Market ～29 Margin Transactions & Loans for Margin Transactions

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～30

MarginTransaction

Loans for Margin
Transaction

Margin buying order
Margin selling order

Margin loan
application
Stock loan application

Stock

Institutional
Investors

Securities
Companies

Fund (Margin loan)
Stock (Stock loan)

JSF

Fund for purchasing
Stock to sell

BrokerInvestor Structure of Margin Transactions& Loans for Margin Transactions

Funds

Call Market

Purchased stock
Sale proceeds
Bank ofJapan

Stock Exchange
Clearing Facilities
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～31 Revenue Structure of Loans for Margin Transactions

Over-lent

Income Statement

Margin Loans

Over-lent(E)=(A)-(D)Stock Loans ※(C)

Matching(D)=(B)-(C)Matching(D)=(B)-(C)Margin Loans(A)

Stock Loans(B)

Operating revenues:
Interest on loans＝(A)×0.60%
Fee on lending securities (lendingfees) ＝(B)×0.40％
Interest on collateral money of
securities borrowed＝(C)×0.60％
Operating expenses:
Interest on borrowing＝(E)×funding rate

Besides the above, premium charges are posted in operating revenues (fees on
lending securities) in part of over-lent stock loans. However, the same amount isposted in operating expenses (fees of borrowing charges), so the amount ofpremium charges does not affect our profit.
Revenue: Fees on lending securities (premium charges) = Expenses: Fees onborrowing securities (premium charges) = (C)‘×rate of premium charges
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～32 About the Margin Loan Rate

LendingFee
0.40%

Securities
Company

Loan Rate
0.60%

BOJ Policy Interest Rate

Stock Loan

JSF

Securities
Company

Margin Loan

Jul 2006 Uncollateralized O/N Call Rate:0.25％



Feb 2007 Uncollateralized O/N Call Rate:0.50％



Oct 2008 Uncollateralized O/N Call Rate:0.30％（▲0.20%）

Dec 2008 Uncollateralized O/N Call Rate:0.10％（▲0.20%）



Oct 2010 Uncollateralized O/N Call Rate:0～0.10％（▲0.10~0%）
Apr 2013 Switched from an interest rate to monetary baseJan 2016 Embraced negative interest rates
Sep 2016 Introduced QQE with yield curve control

Interest on Collateral
Money: 0%

Margin Loan Rate










27/Jul/2006 0.74％（+0.14％）
22/Sep/2006 0.86％（+0.12％）
15/Mar/2007 1.02％（+0.16％）
05/Apr/2007 1.11％（+0.09％）
29/Jan/2009 0.97％（▲0.14％）
22/Nov/2010 0.77％（▲0.20％）
06/Aug/2014 0.64％（▲0.13％）
09/Mar/2016 0.60％（▲0.04％）

 The margin loan rate is decided byreflecting the changes in market rates andthe BOJ’s Policy Interest Rate.
Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～33 Securities Holdings
Mar-22
Securities Holdings

Mar-23

Unrealized Profits andLossesB/S Amount

Unrealized Profits andLossesB/S Amount

Equity26,955

12,207

23,233

10,349Bond

1,100,835

3,587

768,722▲ 16,048

JGB&Municipal Bond

527,8264,267

356,081▲ 11,630

Corporate Bond

447,409▲786

340,053

Others125,600

106

72,587

14,571

0

16,1672,623

1,142,362

15,794

808,123▲ 3,075

ー(11,290)ー(7,416)

Other Securities
Total（included the effects ofderivatives）

Held-to-maturity
bonds

JGB

B/S Amount

Unrealized Profits andLosses

1,511

162▲ 536 Government guaranteed bonds etc.
▲ 3,881 Foreign government bonds etc.

Unrealized Profits andLossesB/S Amount

Notes

―

Notes

―

*Unrealized profits and losses is not inclueded the effects of hedging with derivatives

Yen Bond Portfolio（JSF）
12,000
8,000
9,798
6,000
4,000
（億円）10,000
2,000
0 years9,424 5 years2.32
Over10
to 10 years
2.69
14/3
14/9

Yen Bond Portfolio （JSF Trust Bank）
9,210
2.81
9,498
3.67
8,158
2.69
1 year to 5 years
Within3.23
1 year
2.41
14/12
15/3
15/9

6.0
5.0
4.0
3.94
3.0
2.0
（年）
1.0
8,378
3.54
0.0
Averageremaining
period15/12(Note) The average remaining period is calculated excluding held-to-maturity bonds and bonds for which hedge-accounting is applied

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～34 Our Group Companies

Subsidiary
Affiliate（ ) Shareholding Ratio

Japan Securities Finance（100%）（100%）Nihon
Building

JSF
Trust Bank

Shareholding
Ratio

100%

Name
JSF Trust and Banking Co., Ltd.

100%

Nihon Building Co., Ltd.

20.0%

Japan Information Processing Service Co., Ltd

20.8%

JSF Information Technology Co., Ltd

Copyright Japan Securities Finance Co., LTD. All Rights Reserved（20.0%）（20.8%）

Japan Information
Processing

JSFIT

Capital(mill yen)

Business Overview

14,000Trust service and banking
service

100

Real estate ownership andleasing
Real estate trading andbrokerage

2,460

Information processing services
Software development and sales

100

Information processing services
Software development and sales～ All For Securities Market ～35 Rating Information

JCR

R&I

Standard &Poor’s

As of 31/Mar/2023

Japan
Securities Finance

RatingOutlookRatingOutlookRatingOutlookLong-term

AA-

StableAA-

StableA

StableShort-term

J-1+

a-1+

（Highest）（Highest）

¥1tri

¥1tri

CP Issue

A-1―※Euro-yen CP issuance limit set at US$3 billion (S&P)

JSF TrustBank

Long-termAA-

Short-term

J-1+

a-1+

（Highest）（Highest）

StableCopyright Japan Securities Finance Co., LTD. All Rights Reserved

AA-

Stable――――～ All For Securities Market ～36 ESG/Sustainability (1)The development of infrastructure that forms the foundation of socio-economic
activities is a key element to realize a sustainable society. It is also one of the
Sustainable Development Goals (SDGs: Goal 9). Our Group provides a variety ofservices, including the Margin Loan Business, as a part of the infrastructure of the
securities market and strives to improve the liquidity of securities and financial
markets and to improve convenience for market participants. Through these
activities, we aim to play a role that includes supporting market participants who are
engaged in similar initiatives to realize a sustainable society.
Our Group believes that it is important to build a system that ensures stable
operations even under various circumstances as it assumes responsibility for the
infrastructure of securities and financial markets. To this end, it is important not
only to respond to disasters in a narrow sense, but also to ensure the stability andhigh reliability of our business base.
In addition, we believe that there are issues to which we can contribute byutilizing the know-how and other resources that our Group has cultivated over theyears.
Based on this perspective, we are currently aware of the following material issues(materialities). Our Group recognizes the roles expected of our Group in addressingthese material issues (materialities) and will advance various initiatives while
flexibly responding to future changes in the social environment.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～37 ESG/Sustainability (2)Important issues we recognize
Classification

E

Item
Climate changePromote a reduction in environmental impact

EducationPromote financial and economic education activities
Promote academic research activities



Promote diversity
Develop and secure human resources and create a pleasant
workplace

Respect human rights, non-discrimination and diversity
Prohibit various types of harassment

Enhance functions as infrastructure for securities andfinancial markets
Contribute to overseas securities and financial market
infrastructure

Human resources

S
Human rights

Capital market

G

Challenges



Corporate governanceContinuously improve corporate governance

BCP

Stably operate business that is not affected by disasters etc.

ComplianceOperate business based on a high awareness of compliance

Risk management

Implement the Risk Appetite Framework (RAF)

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～38 ESG/Sustainability (3)Specific Initiatives on Key Issues
Classification

E

Challenges
Reduce environmental impact

 Improve company facilities to conserve electricity and be conscious ofenvironmental impact
 Promote paperless operations in all areas of the company

Promote financial and economic
education activities

 Hold various seminars on margin transactions
 Hold seminars for investors and training for securities company employees,
etc.

Promote academic research
activities Conduct joint empirical research with the University of Tokyo (Securities
Lending and Lending Transactions Utilizing Distributed Ledger Technology)
 Collaborate with Kyoto University in Index Development Utilizing Margin
and Credit/Debit Transaction Data

Contribute to overseas
securities and financial market
infrastructure Provide technical assistance and investment in Indonesian Securities
Finance

Realize diverse work styles for
employees

 Provide support for childbirth, childcare, and nursing care
− Introduce company-wide teleworking− Understand employee engagement

Enhance corporate governance Strive to enhance governance as a company with a Nominating Committeeetc.
− Ensure that the majority of directors are independent outside directors− Ensure that the Chairman of the Board of Directors and Chairman of the
3 Committees are Independent Outside Directors
 Establish dedicated departments to address various corporate governanceissues with a sense of urgency

Implement risk management

 Implement RAF and establish a system to integrate business management
and risk management

Implement BCP

 Continue to strengthen the BCP system and cyber security system toensure stable business operations as a part of the infrastructure of
securities and financial markets

Implement compliance Prepare manuals and establish Compliance Enhancement MonthS

G

Initiatives

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～39 Our Corporate Philosophy and History to Date

Corporate Philosophy
As an institution specializing in securities finance, JSF has a mission tocontribute to the development of the securities market by proactively
meeting the diverse needs of the securities and financial sectors andto enhance the long-term interests of users, while always maintaininga keen awareness of its public role.
Our History to Date

Focus on stable management of the margin loan business and improving convenience as
infrastructure for securities markets
We will also engage in new operations that meet market needs.

1950
Established as
an institution
specializing insecurities
finance in
response torequests fromthe securities
industry withthe aim ofstabilizing andpromoting thesecurities
market1951

1977

 Launched themargin loanbusiness Launched
the generalstock
lendingbusiness

1989

1998

 Launched Establishedthe
JSF Trust
brokerageBankbusiness forbond lending2019 Launchedloans formargintransactions
for PTS

In conjunction with the establishment of the margin transaction system,
commenced the margin loan business of lending funds or stock
certificates, etc. necessary for the settlement of margin transactions tosecurities companies.
⇒ Roots as a licensed company stipulated in the Financial Instruments
and Exchange Law

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～40

● Our Business Field （Image Chart）＜Funds＞(Margin Loan/Stock Loan)

Securities Financing
Equity Repo
Loan to Individual
Investors or Firms

LenderMoney Market,
etc.

Securities
Lending(Equity andBonds)

Financial
Institutions

SubsidiaryBusiness

Loan to Securities
Companies

Investors

Margin Loan BusinessBorrower

Securities Companies

For
Standardized
MarginTransactions＜Securities＞

Institutional
Investors andSecurities
Companies, etc.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～41

NoticeThis document includes statements relating to business forecasts.
These statements do not guarantee future business performance;
they contain risks and uncertainties. Future business performance
may vary significantly depending on the stock market and financial
conditions or other factors.

Copyright Japan Securities Finance Co., LTD. All Rights Reserved～ All For Securities Market ～