CO., LTD.
3-11, Nihonbashi-kabutocho, Chuo-ku, Tokyo 〒103-0026
Tel 03-3666-0011 Fax 03-3668-7350

Annual Report 2017
Corporate Profile 2018

MESSAGE FROM THE PRESIDENT & CEO
We remain committed to full disclosure of our information in order to strengthen the relationship and trust with our clients and business partners.
We produced this Annual Report 2017/ Corporate Profile 2018 to inform you of our business results, financial status, and business summary.

During the preceding fiscal year, we faced the rising geopolitical risks due to the war of words between US President Donald Trump and North
Korean leader Kim Jong Un, however, the booming economy continued worldwide, and the business results of corporations expanded strongly.
The stock market continued to rise steadily in a Goldilocks Economy which is when growth isn't too hot, causing inflation, nor too cold,
creating a recession. The Japanese stock market hit a record high for the first time in 21 years and the stock indexes of the major Westerncountries also reached all-time high. Although the robust and well-performed markets worldwide continued until the end of 2017, the concerns
over rise in US long-term rate and an outbreak of a trade dispute between US and China stirred up the stock markets from the beginning of
2018.
In such environment, we made a great effort to strengthen our flagship businesses, however, our dealing business slowed down due to the low
market volatility until November 2017. Less attractive financial products also caused the slowdown of subscription and commission
businesses. We only acquired a few investment banking deals and failed to achieve an outstanding result. Since the fraud of a delinquent
factoring company was uncovered, our factoring business has been rapidly improving.
However, other loan related businesses suffered the slow recovery.
However, after December 2017, our business environment and receiving business orders
drastically changed upward, and our sluggish businesses recovered rapidly. Almost all of ourbusiness departments made good results which contributed to offset our past slowdown withinthat fiscal year.
We acquired EJ Consultancy Services in Singapore in August 2017, and we have successfully
built the business base to expand our cross-border services.
As a result, we successfully achieved a surplus again for FY2017, and consequently oursurplus has been continuing for 15 consecutive terms.

As we made a huge profit for the

proprietary investment in the previous fiscal year of 2016, our business result in FY2017 looks
deteriorating compared with that of FY2016, however, we think we made a fairly good resultat cruising speed aside from that special factor.
We are deeply thankful for our customers. We wouldn’t have been able to keep running withthe stable business result until today without our customers’ warm supports. We would like toexpress our deep appreciation to our clients and business partners, and we look forward to yourcontinued patronage and support for us in the future.

Kunihiro Mita
President & CEO
MITA SECURITIES Co., Ltd.

01

Financial Summary of FY2017 (Income Statement)
Commissions

Financial Expenses

The total commission was ¥300,312K (108.4% YoY).

The financial expenses increased to ¥207,059K (137.5% YoY)
as results of increase in our debt in accordance with huge
expansion of the factoring service and our inferior bond issuanceof ¥500,000K.

Operating Revenue

As a result, the net operating income was ¥2,885,749K (69.7% YoY).

Commissions

Brokerage Commission
Although the stock market kept moving upward, thebrokerage commission was ¥139,207K (120.3% YoY) as
our equity brokerage was less active.

Selling, General and Administrative Expenses

Other Commission
The other commission decreased slightly to ¥71,620K(96.9% YoY) as the total asset of the investment funds did
not go up.

The selling, general and administrative expenses decreased to¥2,404,637K (88.3% YoY).
The decrease of the personnel and administrative expenses
related to the stock trading profit generated in the previous fiscal
year contributed to this result.

Trading Profit

As a result, the operating profit decreased to ¥481,111K (33.9% YoY),
the ordinary profit was ¥481,234K (33.8% YoY), the income before
income taxes was ¥483,168K (33.6% YoY), and the net income was¥329,920K (38.2% YoY).

The total trading profit was ¥1,751,961K (58.2% YoY).
Stock Trading Profit
The stock trading profit was ¥1,423,809K (50.8% YoY).
Compared to the previous fiscal year with that huge spot
stock trading profit, the profit of this fiscal year decreased,
however, our dealing business has been steadily expanding
and the business result is exceeding that of last year.
Bond Trading Profit
The bond trading profit increased drastically to ¥328,373K(160.4% YoY). It has been more than two years since welaunched the bond trading team, and we have beensuccessfully achieving a good result.

Financial Revenue
The financial revenue increased to ¥778,554K (111.8% YoY).
We decided to include the factoring commission fee which used to
be posted in the other operating revenue in the financial revenue
from this fiscal year, and that is one of reasons why the financial
revenue went up. The income of the securities loans also
increased slightly, while the dividend income decreased.

(Unit: Thousands of Yen)

Accounts

3,092,808

Brokerage

139,207

Underwriting/Solicitations for sales to specified investors

14,982

Subscription/Distribution

74,501Others71,620300,312
1,751,961

Trading proﬁt
Financial revenue

778,554

Other operating revenue

261,981

Financial Expenses

207,059

Net Operating Income

2,885,749

Selling, General and Administrative Expenses

2,404,637

Business related expenses
Personnel expenses

366,773
1,591,282

Real estate related expenses

38,502Oﬃce expenses

252,193

Depreciation expenses

29,785

Tax and dues

76,611

Provision of allowance for doubtful accounts

22,091Others27,398Operating Profit

481,111

Non-operating income

23,755Non-operating expenses

23,633

Ordinary Profit

481,234

Extraordinary profit

02

Amounts

Annual Report

Annual Report

Subscription/Underwriting Commission
The performance of our hedge funds was lackluster, so thatthe subscription/underwriting commission remained thealmost same level as the previous fiscal year at ¥89,484K(102.2% YoY).

Income Statement (April 1, 2017 through March 31, 2018)

1,933

Other Operating Revenue

Income Before Income Taxes

483,168

The other operating revenue was ¥261,981K (84.1% YoY). In
addition to the TOB agent services and the advisory services,
the real estate brokerage fee increased. As stated previously,
the factoring commission fee was shifted from the otheroperating revenue to the financial revenue, and it pushed down
the other operating revenue of this fiscal year.

Income taxes

62,202

Income taxes adjustment

91,045Net Income

329,920

Note: Fractions less than one thousand yen have been omitted.

03

Current Assets

Current Liabilities

The total current assets substantially increased to ¥36,109,576K(177.3% YoY). The main changes from the previous year are as follows.
•The trading products increased to ¥1,694,059K (126.0% YoY)
as the system of the dealing division was enhanced and thebalance in our dealing division rose at the end of fiscal year.
•The assets for margin transactions decreased to ¥4,922,033K (87.0%
YoY) due to the decrease in the margin transactions. The short-term
guarantee deposit decreased to ¥1,373,572K (79.6% YoY) as well.
•The short-term loans receivable substantially increased to¥21,536,050K (312.9% YoY) as a result of the execution of alarge securities loan.
•As the factoring service recovered drastically, the accounts
receivable-monetary claims increased to ¥2,541,801K (303.7% YoY)
•The deferred tax assets decreased to ¥113,170K (55.4% YoY) as
we reversed it for some portion.

The total current liabilities increased to ¥31,580,414K (197.2% YoY).
The main changes from the previous year are as follows.
•The debts for margin transactions were ¥3,779,472K (92.8% YoY)
as a result of the decline of margin transactions.
•The deposits received decreased to ¥868,870K(58.7% YoY) as aresult of the cash withdrawal of customers.
•The short-term debts increased to ¥23,840,000K(394.7% YoY)
as a result of the execution of large loans.
•As a result of the recovery of factoring services, the accounts
payable-monetary claims increased to ¥71,768K (154.0% YoY).
•The provision for bonuses decreased to ¥141,041K(33.1% YoY)
as we did not have a huge spot profit like the previous year andwent back to the business results at cruising speed.

Fixed Assets

The total fixed liabilities reached ¥600,265K (786.5% YoY) as aresult of our inferior bond issuance of ¥500,000K

The total fixed assets reached ¥2,021,431K (135.1% YoY).
The investments and other assets increased to ¥1,938,224K(137.9% YoY) as we invested in subordinated securities when we
securitized the loan receivables secured by the US real estates.

Balance Sheets (For the year ended on March 31, 2018)

Fixed Liabilities

Net Assets
The total net assets reached ¥5,936,999K (103.1% YoY). Our net
assets achieved the best record since our foundation.
According to the above results, the total assets reached¥38,131,007K (174.4% YoY), and the capital adequacy ratio
was 307.1%. (277.8% at the end of last fiscal year)

Ordinary Profit
Net Income
Net Operating Income

400,000
200,000

498,118

Segregated cash and deposits

1,760,000

Trade date accrual

225,256

Trading products

1,694,059

Liabilities for margin transactions

Assets for margin transactions

4,922,033(Borrowings on margin transactions)(3,734,483)(Loans on margin transactions)(3,906,136)(Cash received for securities lending on margin transactions)(44,988)(Cash collateral pledged for securities borrowing on margin transactions)(1,015,896)

Deposits received

Short-term guarantee deposits

1,373,572

Guarantee deposits received

1,020,759

Short-term loans receivable

21,536,050

Short-term debts

23,840,000

Accounts receivable-monetary claims

2,541,801

Accounts payable-monetary claims

71,768868,870

Income Tax Receivables

128,297

Accounts payable-other

830,626

Deferred tax assets

113,170

Provision for bonuses

141,014

Other current assets

173,881

Other current liabilities

304,528

Allowance for doubtful accounts△37,898

19,7405,000,000(Furniture and ﬁxtures)

8,963

Other noncurrent liabilities

15,0002,500,000

4,000,000(Vehicles)

2,000,000

3,000,000

Intangible fixed assets

Reserves Under the Special Laws

13,3272,000,000

Investments and other assets

1,938,224

1,000,000(Investment securities)(197,103)

6,000,000

0
度
20
04
年
度
20
05
年
度
20
06
年
度
20
07
年
度
20
08
年
度
20
09
年
度
20
10
年
度
20
11
年
度
20
12
年
度
20
13
年
度
20
14
年
度
20
15
年
度
20
16
年
度
20
17
年
度

20
03
年

20

Change in ROE

3,779,472

Performance-based provision for bonuses(Unit: Thousands of Yen)

7,000,000

06
年
度
20
07
年
度
20
08
年
度
20
09
年
度
20
10
年
度
20
11
年
度
20
12
年
度
20
13
年
度
20
14
年
度
20
15
年
度
20
16
年
度
20
17
年
度

度

Trading products

55,735

Change in Net Asset

度

20

05

年

度

1,904,606(Buildings)

00
年

Cash and deposits

18,509500,000

年

31,580,414

Provision for retirement benefits

1,000,000

04

Current Liabilities

65,1261,500,000

03

36,109,576

47,0163,000,000

600,000

Amounts

Deferred tax liabilities

3,500,000

800,000

Accounts

500,000

4,000,000

1,000,000

Amounts

Corporate bonds

4,500,000

20

Current Assets

Liabilities

600,265(Unit: Thousands of Yen)

1,600,000

20

Accounts

Noncurrent Assets

Change in Profits for the past 15 fiscal years

1,200,000

AssetsNoncurrent Liabilities

Financial Highlights

1,400,000(Unit: Thousands of Yen)

(Unit: %)Change in Assets Under Custody(Unit: Millions of Yen)

250,000

20.00

OthersBeneficiary Certificates
Bonds
Stocks

18.00
16.00

200,000

14.00
12.00

2,021,431

Tangible fixed assets

427(Investments in capital of subsidiaries and Affiliates)

18,08013,327
Total Liabilities

Shareholders' Equity(Long-term loans receivable)(630,260)(Long-term guarantee deposits)(44,394)

Capital stock(Other investments)(103,931)

Retained earnings(Allowance for doubtful accounts)(△93,738)

5,936,999
500,000
5,682,295(Legal retained earnings)(92,109)(Other retained earnings)(5,590,186)

Treasury stock

10.00

32,194,007

Net Assets(1,056,272)

150,000

8.00

Annual Report

Annual Report

Financial Summary of FY2017 (Balance Sheets)△245,296

100,000

6.00
4.00

50,0002.00

0438,131,007

5,936,999

Total Liabilities and Net Assets

38,131,007

3

9

/0
18
20

/0
17
20

6

/1
16

20

/0
16
20

20

15

/1

2

6

2
/1

/0

14

15
20

20

20

14

/0

6

2

6

/1
13
20

/0
13
20

20

12

/1

2

6

2

/0

/1
11

12
20

20

/0

6

2

/1
10

11
20

2

Total Assets

0
20

20

17

年

度

度
年
16
20

20

15

年

度

度
年
14
20

20

13

年

度

度
年
12
20

度
年
11
20

20

10

年

度

0.00

Total Net Assets

Note: Fractions less than one thousand yen have been omitted.

05

Annual ReportCompany Executives (From June 2017 to June 2018)

Mission / Business Principles

Kunihiro Mita / President & CEO

Yuji Nakao / Senior Executive Board Director

1994 Graduated from the Faculty of Law at Sophia University
1994 Joined Nikko Securities (current SMBC Nikko Securities)
1998 Joined Mita Securities
2001 President & CEO of the Company

1982 Graduated from the Faculty of Economics at Saga University
1982 Joined Yamaichi Securities
1998 Joined Merrill Lynch Japan Securities(currently Bank of America Merril Lynch Securities)
2002 Joined DLJ Direct SFG Securities (currently Rakuten Securities)
2004 Joined Mizuho Securities
2008 Joined Mita Securities
2012 Executive Director of the Company

Tatehito Kadokura / Executive Board Director

Tsukasa Nakamoto / Board Director

1991 Graduated from the Faculty of Economics at Chuo University
1991 Joined Nikko Securities (currently SMBC Nikko Securities)
2002 Joined Japan Global Securities (currently Naito Securities)
2004 Joined Mita Securities
2009 Board Director of the Company

1998 Graduated from the Faculty of Computer Science at University of California
1998 Joined Atsugi Information System
2002 Joined United World Securities
2004 Joined Societe General Securities
2005 Joined Mita Securities
2017 Board Director of the Company

Tadashi Chaki / Board Director

David Atkinson / Outside Board Director

1992 Graduated from the Faculty of Commerce at Waseda University
1992 Joined Nomura Securities
2008 Joined Mita Securities
2018 Board Director of the Company

1987 Graduated from the Faculty of Japanese Language at Oxford University
1987 Joined Andersen Consulting
1990 Joined Solomon Brothers Securities
1992 Joined Goldman Sachs
1998 Managing Director of Goldman Sachs
2006 Partner of Goldman Sachs
2007 Resigned from Goldman Sachs
2009 Joined Konishi Decorative Arts & Crafts as Executive Director
2010 Chairman of Konishi Decorative Arts & Crafts
2011 President & Chairman of Konishi Decorative Arts & Crafts
2014 President of Konishi Decorative Arts & Crafts
2016 Company Outside Director of Mita Securities

Yoshinobu Fujimoto / Corporate Auditor

Yukihiro Shimizu / Corporate Auditor

1989 Graduated from the Faculty of Law at Waseda University
1991 Registered with the Second Tokyo Bar Association
1991 Joined Asahi Koma Law Office (currently Nishimura & Asahi LPC)
1995 Graduated from University of Chicago Law School (LL.M.)
1996 Registered with the NY state Bar Association
2008 Company auditor of Mita Securities(Currently he is Partner of Nishimura & Asahi LPC.)

1995 Graduated from the Faculty of Engineering at Hokkaido University
1995 Joined Hokkaido Takushoku Bank
1998 Joined IBJ Securities (currently Mizuho Securities)
2000 Joined Nikko Solomon Smith Barney (currently City Group Securities)
2005 Joined Livedoor
2006 Vice President of Livedoor
Chairman of Kazaka Securities (currently Naito Securities)
President of Kazaka Financial Group
Executive Director of Cecile
Executive Director of Media Exchange
2008 Joined Mita Securities as Executive Director
2013 Company auditor of the Company

Shigenari Ishibashi/ Managing Director

1991 Graduated from the Faculty of Business at Doshisha University
1991 Joined Fuji Bank (currently Mizuho Bank)
2000 Joined HSBC
2005 Joined Deutsche Bank
2006 Joined Capital Partners Securities
2016 Joined Mita Securities

1992 Joined Aoyama Audit Corporation
1993 Graduated from the Faculty of Political Science and Economics at Meiji University
1997 Registered as a Certified Public Accountant
1998 Joined Credit Lyonnais Bank
2000 Joined Canadian Imperial Bank of Commerce (CIBC)
2003 Transferred to CIBC World Markets (Japan)
2017 Joined Mita Securities

Yoshiki Iida / Managing Director

Keisuke Tomoyori / Managing Director

2003 Graduated from the Faculty of Business at Toyo University
2003 Joined Okasan Securities
2006 Joined Japan M&A Management
2007 Joined Mita Securities

2002 Graduated from the Faculty of Economics at Musashi University
2006 Joined Nikko Cordial Securities
2009 Joined Mita Securities

SincereSoft＆Service
Small, Slim＆Speedy

Our Company’s officers and employees act faithfully for our clients, business partners, laws
and ordinances, and shareholders.
Our Company’s officers and employees provide high-value added businesses
with our original business knowhow and the best services.
Our Company carries out speedy decision-making with our compact and lean organization.

All of the executives and employees share the concept of “ Six S ” as the fundamental principles, make the best effort to achieve
our client’s goals through the securities business, and furthermore, contribute to develop the sound Japanese economy.
Business Principles
Client Focus

Listen to our clients
We can find the best solutions eventually if we fully understand the essence of our clients’ problems.

Win-Win

Conduct businesses by which we can build a win-win relationshipwith every one of our clients, business partners, officers and employees, and shareholders
Only businesses which make every member engaged in projects happy can last longer.

Reputation

Seek businesses which enhance our reputation
Reputation can be enhanced by our efforts with a proper attitude toward businesses.

ROE

Achieve high profit by effective resource allocation
We manage our company with higher ROEs, enhance capital stock, and build a sound financial base.

Compliance

Place importance on complianceManagement focusing on compliance is required naturally within this free market in principle.

Teamwork

Set a high value on teamwork
We can provide the more appropriate business solution for our clients if our team can gain power by
respecting each other’s individuality among the team members.

Adaptability,
Creativity

Cherish adaptability and creativity
Personnel with high productivity can absorb the constantly changing trends of society and anticipate the future.

Commitment

Deal with our services with absolute responsibility
Businesses without responsibility give troubles to various people including our clients, business partners, andhis/her own team members.

Private Banking
Institutional Sales

Financial TechniqueCorporate Profile

Tatsuya Otsuki / Managing Director

MissionInvestment Banking

Principal Investment
Prop Trading

06

07

Special Features of Mita Securities

Wealth Management Services

We continue to achieve positive net income for 15 consecutive terms.

■Wealth Management Services of Mita Securities

Our surplus has been continuing for 15 consecutive terms. We have been going through several difficult times, such as Lehman shock,
European sovereign bond crisis, and the great east Japan earthquake, and obviously it has not been easy for us, a securities firm, to remain in
surplus during this period. However, we have been successfully able to stabilize our business results as we diversified our services broadly into
various businesses, such as private banking, investment banking, money lending services, real estate related services, and dealing business, andmoreover, we have a number of unique financial services and products which no one can find in other financial firms.

Fiduciary Duty
We have been posting a word of “Fiduciary Duty” in our yearly management plan since FY2003 and share this word among all our employees,
as we always believe it is our crucial responsibility as professionals in a security firm to take care of our clients faithfully.
This attitude and consciousness can be seen in our own business data consequently.
Churning is executing excessive trades for an investment account of a client by a salesman in a securities company or a bank in order togenerate commission from the account, and it has been criticized in the market as a matter of the sales attitude of financial products.
Meanwhile, our asset turnover ratio of our clients is drastically low among the security industry, and it is only 0.30% per year.
We also seldom propose our clients to switch the investment funds or hedge funds, therefore the unrealized profit ratio of investment funds ofour clients is +10.4%, which substantially exceeds the market average rate. (As of the end of FY2017)*Asset turnover ratio = Commissions from clients / Clients’ assets in custody*Unrealized profit ratio of clients’ investment funds = Market value of client’s investment funds/Book value of client’s investment funds

Lineup of our unique products and services
It is our one of strengths to have unique financial products and services, and we aim at further differentiation from other financial institutions.
The time of “push sales strategy” in which securities firms sell their financial products to their customers for their own conveniences should beended. We feel significant to offering products and services that our clients truly seek and acclaim.
When we create new products and services, we try to deal with them with flexibility and speed and also carefully examine illegality of those
products and services.
We provide loans secured by US real estates and securitize those loan receivables. We also provide loans secured by securities, such as
investment funds and foreign bonds. We created the fund to restore values of Kyomachiya in Kyoto. We purchase medical accounts receivablesecuritized bonds. In that manner, we aim at producing further unique products and services one after another.

Venture Sprits
We value a freewheeling culture and challenging sprit. Our firm is made up by various types’ professionals, and it is indispensable for us toenjoy works by making the best use of our ingenuity in order to deal with creative works. Our company was established in 1949 and it is nota young company, however, we never forget our venture spirts inside our hearts.

Main Business Achievements after April, 2017

Corporate Profile

Organization Chart

Real Estate Services

We support our clients’ asset management from the side. We provide
broad and various investment products not only traditional financial
products such as stocks, bonds, and investment trusts, but also
products tailored for clients’ needs and special occasion products.
We not only provide financial products, but also analyze individual stocks,
financial products, and portfolios. We also calculate market value of the financial
products, propose asset diversification, and give various financial advices.

We are qualified as a registered real estate broker, and received
approval to launch real estate funds as a real estate specified joint
enterprise operator. Our real estate team deals with our clients’various needs for real estates. Its services include sales transactionsof real estate and real estate trust beneficiary rights, efficient usagesof real estates, and the establishment of real estate funds, by utilizing
our features as a securities firm.
We also provide information of international real estates and support sales
transactions in response to the increasing needs for overseas real estates.

Inheritance Strategy
It is essential to take enough time for inheritance measures in orderto pass on the assets to the next generation. Moreover, we should
keep it in mind to secure assets with high liquidity so that successors
can pay inheritance tax without difficulty. (Tax payment measures)
We especially need to be careful if the portion of assets with low
liquidity in major proportions.
We grasp the current condition and plan the best measure according toour clients’ intention, and we also provide our clients with simulation
works for inheritance tax, advices for inheritance measures, andassessment of unlisted stocks. Nowadays we proceed with theresearch for inheritance measures with utilizing global schemes.

Business Inheritance Measures
It is a constantly critical issue how our client’s companies should be
passed on to the next generation. If the stocks are unlisted, it would
require substantial money for tax payment when transferring them.
Therefore we need to plan carefully and execute it steadily forsmooth business inheritance. It is also necessary to hedge risks forunexpected disease or death. The most important point of all is toclarify who will the successors.
We ourselves experienced the business inheritance, and have been
engaged in a number of cases for our clients as well. By making useof these experiences and achievements, we are confident in proposing
realistic and flexible measures which meet our clients’ needs.

Finance DivisionCorporate Auditor

Audit Division

Board of Directors

President & CEO

Compliance Committee

Administration Dept
Financial Reporting Dept
System Dept

Control Division
Investment Banking Division
Equity Dealing Division

Operations Dept
Compliance Dept.
Underwriting Evaluation Dept

Tax Advisory Office
Client Relation Division

Wealth Management Dept

Financial Product Division

Retail Sales Dept

Real Estate Division

Fund Structuring Support
In case of forming funds (including partnership), it is necessary tofollow various business regulations. We support our clients to form
funds, such as business-oriented funds, funds to invest in securities,
and real estate funds which meet our clients’ needs. We have trackrecords for a number of private fund establishments.

Finance
We are qualified for the money lending business and can support fundraising for our clients. We endeavor to provide speedy and high-quality
services so that we can meet our clients’ finance needs quickly. Our financeservices include securities-backed loans and mortgage-backed loans, andespecially investment trust-backed loans and mortgage-backed loans foroverseas (mainly US) real estates are our unique services.
We also possess the broad range of experiences and solutions forcorporate finance, not only for individual clients. We provide theexclusive solutions to meet our clients’ needs by partnering with ourinvestment banking division, including factoring services andpurchasing stock acquisition rights.

Insurance
We try to deal with various risks surrounding our clients, and we
propose schemes to hedge risks, which fit our clients’ life plans.

Other Services
Capital Strategies/M&A

System Risk Committee

08

Asset Management

We propose our clients’ companies with the most appropriate solutions
for even complicated issues by utilizing our new technologies andbroad information networks, such as capital strategies or M&A.
We can provide a wide range of services, such as consolidation of
scattered stocks, inheritance of stocks to successors by controlling thevoting rights, acquisition of international companies aiming foroverseas expansion, M&A utilizing treasury stocks, unwinding
cross-shareholding (block trades), and global reorganization. We
utilize our total capability with our investment banking division, tax
advisory team, and external professionals.

•Block Trade
We search counterparties for our clients’ block trades with our
external business partners, when our clients are willing to sell orpurchase a large amount of listed stocks at one time.
•Stock Lending
Our clients can obtain negative interest per diems by lending theirowned stocks.
•Standing Proxy Services
If our clients are non-Japanese residents and willing to maketransactions of Japanese securities, it is required for them todesignate a standing proxy in Japan. We support those clients for
non-resident transactions by becoming their standing proxy.

Corporate Profile

We acquired EJ Consultancy Services in Singapore and it became our subsidiary company.
█ We served as the financial advisory agent for the cross-border M&A deal.
█ We served as the TOB agent for Powertech Technology Japan Inc’s tender offer for shares of Tera Probe, Inc(listed in TSE Mothers).
█ We served as the TOB agent for Aqua Strategic Investment Limited Partnership’s tender offer for shares of SEVENSEAS HOLDINGS CO., LTD(listed in TSE 2nd Section).
█ We served as the TOB agent for Maruman Korea Co., Ltd.’s tender offer for shares of Maruman & Co., Ltd(listed in TSE JASDAQ Standard).
█ We served as the TOB agent for Belluna Co., Ltd.’s tender offer for shares of SAGAMI GROUP HOLDINGS Co., Ltd(listed in TSE 1st Section).
█ We launched two Kyomachiya reconstruction funds utilizing Real Estate Specified Joint Enterprise Act, to aim at the restoration of Kyomachiya.
█ We purchased the warrants of TRADERS HOLDINGS CO., LTD.
█ We launched three CLOs backed by loans secured by US real estates.
█ We became an agent for US stock trades.
█

Since 1949, we have been running the family business, and we are one of a few privately owned securities companies whose majority shares are owned by one family.
While we keep our family business and we were also engaged in sustainable development of family businesses of our clients, we have obtained
various knowhow and experiences of wealth management.
Our wealth management team supports for the greater prosperity of our clients’ families by providing with the services which we ourselves actually have experienced.
We believe it is our virtue, value, and pride to be able to keep a good relationship with our clients’ families for generations.
We provide the most appropriate advice and services for the whole field of assets of our clients including asset management, inheritance, andbusiness succession. With a mid- and long-term point of view, we commit to work diligently for the sake of our clients.

If there are any other requests, we make the best effort to fulfill our clients’ needs and requests as much as possible. By dealing withvarious requests from our clients proactively, our services have succeeded to expand and deepen. Requests from our clients areimportant sources for our company’s sustainable development.

09Real Estate Services

Investment Banking Services
We provide various services for finance and business strategies as our main investment banking services.
Our services include financial advisory services for rights offerings and M&A and TOB agent services. Especially we have strength in mediumand small-sized projects or special projects which major investment banks do not deal with proactively. We have been successfully
accumulating experiences and the actual results steadily in these fields.
We are building the business systems to enable us to invest, to lend money, or to accept securities by ourselves, so that we can deal with a wide
range of our clients’ finance demands with flexibility.
We are now searching business partners who would introduce our services to a number of other clients on behalf of us. Those partners can utilize ourcompany’s infrastructures linked with various financial services and the network among our business partners by joining our Mita Partnership Program.

Finance
We provide various clients including listed and unlisted companies, medical institutions, nursing care operators, dispensing pharmacies, company management, etc.
with funds in various ways. We can propose the appropriate solutions even for the difficult projects which banks or other security companies do not deal with.
•Rights Offering (commitment type)
Rights offering is a new technique of a capital increase for listedcompanies, where share options are allotted to all shareholders without
contribution. It has been attracting attention rapidly in recent years.
We can deal with the commitment type of rights offering, whichmeans we purchase all the share options which were not exercised by
the shareholders and then we exercise all of them. With utilizing thisscheme, listed companies can achieve capital increases without fail.

•Underwriting and Purchase of Securities
We have a number of track records for securitized products andpurchase of listed companies’ securities such as warrants issued bya third-party allocation. We provide tailored finance plans withlower costs in a speedy manner.

Real Estate Intermediary

Forming and Selling of Real Estate Funds

We search buyers or properties for our clients’ needs of selling orpurchase of real estate, and give our clients the one-stop services
including negotiations and executions.
We try to gather original information given from our special
sources or from our close relationship with real estate companies,
other than Internet information already on the market.

We are a securities company qualified as a real estate specified joint
enterprise operator, and we provide smaller-sized real estate products basedon the aforementioned regulations. Foaming original funds which meet ourclients’ needs is one of our strengths, and we deal with other securitizationneeds based on laws other than Real Estate Specified Joint Enterprise Law.
Creating the schemes is supported by our tax accountants, lawyers, etc.
and is achieved with a high-level of performance.

Intermediary of Real Estate Trust Beneficiary Rights
We deal with intermediary services of real estate trust beneficiary.
We support a series of transactions including research for realestate and submitting its report, preparation of documents basedon the Financial Instruments and Exchange Law, preparation oftransaction agreements, settlement services, etc.

Real Estate Loans
We provide loans backed by clients’ real estate properties which
can be both domestic and overseas, and that is the most significant
feature among our services.
We try to grant loans with a term of a minimum of one week fromreceiving loan applications, so please contact us for any urgent requests.

Advisory

Other Real Estate Solution BusinessWe provide comprehensive and tailor-made solutions, centered for listed companies, in order to meet the various requests of our clients, suchas capital increase through shareholders’ allocation, M&A, reorganization, business alliances, etc. We utilize our advantage of being a small
team of elite professionals and show a strong presence in projects which major financial institutions do not deal with.

We provide solutions relating to various real estate businesses
including effective use and value-up of clients’ properties.

•Rights Offering
As stated earlier, we hold the top track record of market shares inJapan as financial advisor. We provide broad and maximum support
including scheme design, financial assistance for shareholders, andassisting negotiations with public organizations.
•Stock Option
We provide listed companies and companies planning initialpublic offerings with consulting services to implement various
stock options, and we also deal with opening and management ofspecific accounts used for exercising stock options.

•M&A Advisory Services
We provide various professional advisory services as well as company
valuation, which are essential for execution of M&A. It is not realistic to
pay all the huge investment cost of M&A by its own money. It is quite
common that the company is forced to find some kind of way for fundraising with necessity, and we can arrange the best finance schemes forour clients at the same time with our M&A advisory services.
•TOB Agent Services
As a general rule, it is required to appoint a security company as TOB
agent when considering acquiring stocks of the listed company morethan a certain number off the market. We have abundant experience andtrack records of TOB as TOB agent. We provide comprehensive supports
including scheme design of TOB and various administrative works.

Stock Dealing Business

Bond Trading BusinessWe have top-class stock dealing members among middle-classsecurities firms. They are focusing of the proprietary trading withstocks, futures, and option trades. We also placed the dealing
division in Singapore, and it has been contributing to our goodbusiness results.

We have highly experienced bond dealers in our dealing division.
They purchase good bonds from outside and sell them to ourcustomers, and they also engaged in distributing bonds to othersecurities firms. We have been able to provide various types ofbonds to our customers as a result of our abundant relationshipwith investment banks and frequent participation in the clearing
house that specializes in the settlement of securities transactions.

•Securitization
There are methods to achieve fundraising by dividing assets into
small-lot and securitizing them. We provide a full range ofservices including the first scheme design, setting up funds,
intermediary or mediator services, and the final exit.

We believe we should also be an investor before we offer
investment opportunities to our customers. We earnestly searchvarious investment opportunities globally and would invest in
attractive financial products at our own risk.
Corporate Profile•Standing Proxy Services
If our client is a non-Japanese resident and willing to make transactionsof Japanese securities, or if shareholders or corporate bondholders
move out of Japan, it is required to designate a standing proxy in Japan.
We serve as standing proxy while there is only a limited number of
securities companies that can handle this standing proxy services, andwe make the best effort to meet our clients’ business needs.

Proprietary Trading

Proprietary Investment

Other Services

Corporate Profile

We try to meet our clients’ needs for searches and selling of real estate properties and other requests relating to real estate in our Real Estate Division.
We are qualified as a registered real estate broker, and as a real estate specified joint enterprise operator, and we are making approaches toward
the real estate market from a fair and neutral point of view as a securities firm. We also develop real estate investment products originally andare increasing the investment choices of our clients as we try to provide unique real estate businesses.

Money Lending BusinessOne of our other services is money lending business, and we deal with funding needs of clients, such as listed companies’ owners. We also support fundraising for medical institutions with our factoring services.

10

Securities-backed Loans

Factoring/Loans for Medical Institutions

We provide loans by accepting listed stocks, investment funds,
and foreign bonds as collateral. The registration names of thoseshares will be unchanged, so that clients can utilize their own
stocks without losing their rights of shareholders.

We purchase the accounts receivables of medical consultation fees,
dispensing fees, and nursing care charges from medical institutions. We
also provide loans to medical institutions. We started this factoring businessin 2003, and now we are one of the factoring service companies with thelongest history of achievements.

11Compliance

Company Overview■Compliance Structure of Mita Securities

We are a financial instrument business operator who is an important player in this financial market, therefore we not only ensure strict
compliance with all laws and regulations, but also need to develop the sufficient internal control structure in order to protect investors and tosecure fairness of the market. Compliance is a top management priority for our company.

Governance

Board of Directors

Audit Department

Audit

External Auditor

Audit Report

Internal Control System
Any financial instrument business operator is required to check client management, sales personnel management, transaction management, transaction
inspection, underwriting examination, compliance inspection system, lawsuits against clients, administrative management, information control, andexternal business contractor management. We also manage a Chinese Wall and the information control related to the clients systematically.

Tokyo Head Office Map
Tokyo Stock ExchangeTokyo Head OfficeEitai Dori

12

Tanjong Pagar Station

Securities Dealers Association

Tokyo Tozai Hibiya Line

Osaka Branch Office Map

LAWSON
ローソン

Kayabacho Intersection

Fukusuke

Singapore Branch Office

Robinson Rd

Kayabacho Station

Risk Control System
We analyze various risks including transaction risks, operational flow risks, and system risks, and we pay close attention to those risk
management so that we can eliminate or limit risks in advance. It is most important to prevent risks before they actually happen. But if we
actually fail to eliminate them, it is reported to the Board of Directors through the manager of corporate management department, and the Boardof Directors conducts risk management in order to deal with it appropriately and quickly.
Moreover, we place the System Risk Committee under the Board of Directors, and this committee periodically examines our overall systemrisks, and improves them if necessary.
As for the risk of sudden natural disasters, we plan the BCP (Business Continuity Plan) and aim to avoid the risks. We also conduct trainings
in order to be able to continue our businesses in emergency situations to the greatest degree possible.

Singapore Branch Office Map

Telok Ayer Station

Rafﬂes Place Station

Shenton Way
Marina Bay

Corporate Profile

It is essential for all officers and employees in the securities companies to comply with the compliance with all laws and regulations. However, due to the existenceof broad and various regulations in the securities industry, it is likely for us to have a brush with the laws and regulations without consciousness. In order for ourofficers and employees not to breach the compliance with all laws and regulations, we periodically conduct the training programs for them aiming to enhance theirunderstanding for the compliance. We also display our internal regulations on our intranet so that our officers and employees can easily browse them.
The corporate management department checks the compliance system every day, and the audit department conducts internal audits based on the audit plan.
If there are any violation of the laws and regulations, the audit department conducts the quick and appropriate procedures, and improves the problems.
Moreover, we place the Compliance Committee under the Board of Directors, and this committee examines our overall compliance system with expertise.

(As of June, 2018）

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ダク
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ペル
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Corporate Profile

Compliance with All Laws and Regulations

Membership in Exchanges:
Membership in Investor Protection Funds:
Accounting Auditor:

Subway Sakaisuji Line

Check and Assessment of Compliance System,Risk Controls,and Internal Controls/Demands for Improvement of Problems

Check for Risk Control
and Internal Controls

Corporate Auditor

Membership in Associations:Inter Circular Route(Toll road)

ComplianceDepartment

Pointing Out Problems ofInternal Control System

Showa DoriInfrastructure Unit

Reporting Problems ofInternal Control System

Toei Asakusa Line

Check for Compliance System andInternal Control System

Business Unit

Governance Check

Instructions for
Problem Solving

Nihonbashi Station

Instructions for Improvement to Enhance
the Quality of Internal Control System

Maxwell Rd

Head of Internal Control System•Compliance Committee•System Risk Committee

Shin-Ohashi DoriCommittee

Commencement of Operation:
Capital:Major Shareholder:
President & CEO:
Office addresses:

MITA SECURITIES Co., Ltd.
Director of Kanto Local Finance Bureau (Financial instruments firms) No.175
Moneylender / Tokyo Governor (6) No.27088
Registered Real Estate Broker / Minister of Land, Infrastructure, Transport and Tourism (1) No.9342
Real Estate Specified Joint Enterprises / Commissioner of the FSA・Minister of Land, Infrastructure and Transport No.76
July 1949¥500,000,000
Kunihiro Mita
Kunihiro Mita
(Head Office)3-11, Nihonbashi-kabutocho, Chuo-ku, Tokyo 〒103-0026
Tel +81-3-3666-0011 Fax +81-3-3668-7350(Osaka Branch)
1-7-15, Minami-honmachi, Chuo-ku, Osaka City, Osaka 〒541-0054
Tel +81-6-6260-5670 Fax +81-6-6260-0882(Singapore Branch) 07-03/04 112 Robinson Road Singapore 068902
Tel +65-6692-8325
South side of Nijyo, 2 cho-me, 403 FIS Building, Kawaramachi Street, Nakagyou-ku, Kyoto-shi, Kyoto 〒604-8006(Kyoto Local)
Tel +81-75-555-3423 Fax +81-75-256-8660(Subsidiary)
EJ Consultancy Services Pte. Ltd.
66 Horne Road, #04-00, Singapore 209073
Tel +65-6396-8329 Fax +65-6294-6559
Japan Securities Dealers Association
Tokyo Real Estate Association
Japan Financial Services Association
The Tokyo Stock Exchange・The Osaka Stock Exchange
Japan Investor Protection Funds
SeishinShisei & Co. / OAKFIELD & ASSOCIATESTokyo Metro Hibiya Line

Our Governance

Company Name:
Registration:

Heisei DoriOur governance framework is as shown below.
The Board of Directors has a role with a full responsibility for the internal control system. It has a responsibility to enhance the quality of the internal controls
by receiving reports and evaluations from the corporate management department, the audit department, the auditors, the accounting auditor, or others.
The corporate management department examines the status of compliance and risk controls of the business department, and checked every day if there are any
violations of laws and ordinances and risk control-related problems. If any, it requests the business departments for improvement and also reports these important
issues to the Board of Directors.
The audit department periodically examines and assesses the quality and functions of the internal control system of the corporate management department.
If necessary, it conducts improvement of the problems for the corporate management department, the business department, and the administrative
department, and it points out the problems and lists demands for improvement to the Board of Directors.
The auditors have a role for the governance inspection for the Board of Directors, and examine if the Board of Directors is managed legally andappropriately or if there are any violations of the duty of a prudent custodian to the Company. If there are any problems associated with the above, theauditors send a list of demands for improvement to the Board of Directors or conduct the predefined necessary procedures.
The accounting auditor conducts auditing for the appropriateness of our accounting process and the appropriate indication of the financial statements.
Our accounting auditor is SeishinShisei & Co. currently.

Osaka Branch Office

Teijin Hall

Chuo Odori

Sakaisujihonmachi Station
Bank of Tokyo-Mitsubishi UFJ

Subway Chuo Line13