Ending March 31, 2012

Okasan Securities Group is a stand-alone securities company group established in 1923.
Headed by the holding company, Okasan Securities Group Inc., it consists of nine
domestic companies and one overseas company. Okasan Securities Group is committed
to a wide spectrum of securities investment and asset management businesses, through a
network of six domestic and overseas securities firms centering on the core firm, Okasan
Securities Co., Ltd. It is also involved in asset-management business, such as investment
trusts, information-processing/system-development business, as well as office-support
business, such as alternate back-office jobs.
Taking advantage of nurtured expertise since its inception, Okasan Securities Group
engages in unique and community-based “face to face” securities sales activities, and it
also provides a cutting-edge online trading environment. We are always ready to offer
optimum performances by way of highly sophisticated and professional investment andasset management services, which include the development of innovative products,
extensive and abundant market information, and high quality analyst information.

Corporate Profile

1

Consolidated Financial Highlights

2

Management Policy

3

Operating and Financial Review

6

Consolidated Balance Sheet

10

Consolidated Statement of Income

12

Consolidated Statement of Comprehensive Income (Loss)

13

Consolidated Statement of Changes in Net Assets

14

Consolidated Statement of Cash Flows17

Notes to Consolidated Financial Statements

18

Independent Auditors' Report45

Reference Data
Okasan Securities Co.,Ltd.

Non-Consolidated Balance Sheet

47

Non-Consolidated Statement of income

49

Corporate Data50

1Consolidated Financial Highlights
Okasan Securities Group Inc. and consolidated Subsidiaries Year ended March 31, 2012
Millions of yen
2012(4/1/11 ～ 3/31/12)

2011(4/1/10 ～ 3/31/11)

Thousands of
U.S.dollars (note)
2012(4/1/11 ～ 3/31/12)

Operating revenues  …………………………

¥ 61,065¥ 62,964$ 742,974

Operating income ……………………………

3,152

3,409

38,350Net income  ……………………………………

984

640

11,972

Total assets ……………………………………

556,389542,537

6,769,546

Net assets ………………………………………

112,016

112,623

1,362,891

Per share of common stock

Yen

U.S.dollars (note)

Basic net income ……………………………

¥ 4.93¥ 3.15$ 0.06

Cash dividends applicable to the year ……

5.00

5.00

0.06

Note: The translation of the yen amounts into U.S.dollars are included solely for the convenience of the reader, using the prevailing exchange
rate at March 30,2012, which was ¥82.19 to U.S. $1.

'08 '09 '10 '11 '12'08 '09 '10 '11 '12'08 '09 '10 '11 '12

2'08 '09 '10 '11 '12

Management Policy
Okasan Securities Group Inc. and Consolidated Subsidiaries
1. Basic management policy for the Company
The Company manages the corporate Group consisting of the Company, which is the holding company, andconsolidated subsidiaries in Japan and abroad. Through asset management services, which have at their core
the securities business and asset management business, the Company aims to continue to increase corporate
value and to become a company that is trusted by customers, shareholders, and the market.

2. Basic policy on the distribution of profits and dividend for the term
We regard returns to shareholders as a management priority. While ensuring that sufficient earnings are
retained to strengthen management and achieve future development, we pay dividends according to the Group's
performance, with the intention of maintaining steady dividends.

3. Important management index
In rapidly changing market conditions, it is important to secure stable profits. Based on this understanding, we
consider return on equity (ROE) an important management index. We aim to achieve a stable consolidated ROEof 10% as a business objective.

4. Medium and long-term management strategy
Okasan Securities Group Inc. is currently advancing a medium-term business plan for the period from April 2010
through the end of March 2013 (from FY2010 to FY2012). The plan is focused on elevating the quality of ourservices following our basic policy of “Do all we can for each and every one of our clients.” The plan's objective
is to enhance our presence in the markets and construct an earning structure capable of realizing steady growthby “providing highest-quality products, research, and services” and “establishing unique brokerage services thatmatch local-area characteristics.”.
In FY2011, the second year of the medium-term business plan, Okasan Securities Co., Ltd. pushed forwardwith its program to build a product and information provision infrastructure based on a “global perspective,”
broadening its product lineup in foreign equities, investment trusts and so forth, as well as strengthening theoverseas research capabilities of the Investment Strategy & Research Division and starting publication of a
new series of research reports. Okasan Online Securities Co., Ltd. worked to upgrade the quality of customer
service, by developing Japanese equity trading tools for smart phones and foreign currency margin trading
tools. It also started services for corporate clients, aiming to broaden the customer base. In IT infrastructure, theCompany also focused on the continuing development of ODIN (Okasan Database Information Node).

3

New medium-term business plan of Okasan Securities Group Inc.
-1. Period of the plan
Three years from April 2010 through the end of March 2013
-2. Basic Group policies
For our clients

To do all we can for each and every one of our clients・Provide for best products, information and services
・Establish a business model of community-based securities-business style

For our employees

To be a leading company with regard to employees' sense of job satisfaction

For our shareholders	To enhance the corporate value of the Group, which was built around retailsecurities-3. Management goals on a consolidated basis
ROE: 10% as a long-term target
Net assets: 130 billion yen at the end of the plan period

5. Challenges the Company should address
The increasing economic interdependence of countries around the world and the steady progression toward a
truly global economy are making a “global perspective” more important than ever for investment decisions. This
trend is also making quality investment advice increasingly essential for investors.
Our medium-term business plan from FY2010 to FY2012 (April 1, 2010 through March 31, 2013) was formulated
in response to this business environment, and the Company is implementing the plan in an effort to increase
enterprise value. The corporate group continues honing its competitive edge, which is our ability to flexibly
provide products and information services best suited to meet the needs of each client from a global perspective,
while implementing a marketing structure that tailors brokerage services to match local-area characteristics, inorder to be a highly trusted investment advisor that is the best partner for our customers. The group continues
its efforts to build good relationships with shareholders, implement sound management, and further develop its
operations as it approaches its 90th anniversary in April 2013.

6. Outline of corporate governance structure(1) Basic concepts regarding corporate governanceAs globalization progresses and a shift in management towards creation of enterprise value accelerates,
the importance of corporate governance is increasing. In response to this environmental change, weare committed to high standards of corporate governance as we regard it as one of our management
responsibilities. As we face the challenges of a rapidly changing business landscape, we have undertaken
to deliver such solutions so as to speed up the decision-making process and to enhance efficiency of the
managerial and supervisory systems.
(2) Structure of business execution
With regard to the structure of business execution, the Board of Directors as the supreme decision
making organ on management makes a decision on items provided in laws and regulations and articles
of incorporation and maps out plans of the management strategy of the Group and supervises them. The
President - CEO executes decisions of the Board of Directors and supervises overall management. The
Board of Directors consists of 7 directors, which enables it to make a quick decision by being small in
number.

4

We have introduced the operating officer system, clarifying the roles of the Board of Directors, which makes
management decisions and supervises management, and executive officers, who are in charge of businessexecution, to strengthen the business management of the Group. The Board of executive officers consistsof 12 such officers and, according to the basic management policies adopted in the Board of Directors,
deliberates on laying out specific policies and plans of business execution and other important managerial
subjects. In addition, we set up the “Group Strategic Management Meeting” and “Group Administrative
Management Meeting” as advisory bodies to the president-director, to realize the planning and decision of
uniform and flexible management strategies and the improvement in the administration of each of the Group
companies.
(3) Management monitoring structure
As regards the structure of the management monitoring, out of 6 auditors in total that includes 3 statutory
auditors, 3 are outside auditors specified in the corporate law under Article 2, paragraph (16). Auditors
constitute an auditors' meeting, decide on auditing policies according to laws and regulations and articles
of incorporation based on the rules of auditors' meeting, and make up audit opinions from the reports ofauditors. And through attending the Board of Directors and other important meetings etc., hearing the Boardof Directors and looking through important approved documents etc., they oversee the process of decision
making at the Board of Directors and the state of business execution of directors. In addition, they are trying
to implement a proper auditing in cooperation with independent auditors and the divisions in charge ofinternal auditing.
Okasan Securities Group Inc. entered into an agreement with the 3 outside auditors to limit their liabilities
under Article 423, Paragraph 1 of the Companies Act to the amount provided by laws and ordinances.
(4) Internal auditing structure
As part of efforts to contribute to secure appropriate business operations such as reducing management
risks and preventing wrongdoings, we set up internally the auditing division and assigned four staff there.
The auditing division makes up an audit plan in each fiscal year, periodically implements an on-the-spot
audit based on the plan and inspects documents when necessary. The results of auditing are reported to theBoard of Directors from the director in charge of auditing, in the form of the audit report.

5Operating and Financial Review
Okasan Securities Group Inc. and Consolidated Subsidiaries Year ended March 31, 2012

Ⅰ．Analysis of operating results
In the Japanese economy, activities such as industrial production declined markedly early in the fiscal year,
due to supply chain (component supply) problems and power shortages resulting from the Great East Japan
Earthquake. However, production and consumer confidence subsequently recovered more rapidly than
expected, with acceleration in reconstruction demand becoming particularly evident from autumn. As a result,the downturn in business confidence was limited even when the yen appreciated rapidly. Significant increase in
crude oil prices, however, caused the trade balance to deteriorate.
In the foreign exchange market, the yen's climb against major currencies accelerated from July, due to thesovereign debt crisis in Europe and the US treasury downgrading, with the yen at one point reaching an all-timehigh against the dollar of around ¥75 in October. However, the overvaluation of the yen was rapidly corrected
thereafter, as foreign exchange market concern was allayed by fund supply operations implemented by theEuropean Central Bank in late December and progress was made in talks to solve Greece's debt problems at
the beginning of 2012. Furthermore, a series of stronger than expected US economic indicators were released,
and the Bank of Japan demonstrated its strong resolve to ensure that monetary policy was accommodative.
The equity market was concerned about stagnant production activity, because of the severing of the supply
chain, but remained roughly flat early in the fiscal year. However, risk-off mode was more evident in global equity
markets from August, because of the worsening European debt crisis, and the Nikkei 225 dropped to its lowest
level for the fiscal year, of 8,160.01, in November. The yen's appreciation was subsequently halted by two fundsupply operations by the European Central Bank and additional monetary easing by the Bank of Japan, and theJapanese equity market entered a rebound. The Nikkei 225 ended the fiscal year at 10,083.56, marking a rise of
3.4% over the year.
In the fixed income market, yields declined overall because demand remained firm for low risk assets, given
the slowdown in the Japanese economy resulting from the Great East Japan Earthquake, disruption to global
financial markets due to concern over a possible debt default by Greece, and a downturn in the US economy.
The yield on new 10-year Japanese government bonds fell mostly to less than 1% in the second half of the fiscal
year, as central banks in developed economies eased monetary policy further and the Bank of Japan did also.
In March, the yield climbed back above 1% temporarily, but then declined again to end the fiscal year at 0.985%,
thanks to favorable supply-demand.
In this environment, Okasan Securities Co., Ltd., the core company in Okasan Securities Group Inc. (theGroup, hereinafter), broadened the product lineup by expanding the range of foreign equity markets it deals
in, and implemented efforts to make customers' assets under custody grow through offerings of products suchas investment trust funds and foreign bonds, under the theme of "upgrading product and research globally,
including Japan." The company also strengthened the overseas research capabilities of the investment strategy
divisions. The internet broker Okasan Online Securities Co., Ltd. introduced a large number of new trading tools,
mainly for smart phones, for Japanese stocks and FX (margin trading in foreign currencies), while also starting
a service for corporate clients, thereby focusing on expansion in the customer base. In a rapidly changing
investment environment, Okasan Asset Management Co., Ltd. responded quickly to provide product solutions
while also providing investors with timely information, and also upgraded its asset management platform bymaking its organizational structure more efficient.
As a result of the above mentioned environment, operating revenues and net operating revenues of the Group
Inc.(consolidated) decreased 3.0% each from a year ago, to ¥61,065 million and ¥59,467 million respectively forthe fiscal year. As selling, general and administrative expenses decreased by 2.7% from a year ago, to ¥56,315
million, ordinary income for the fiscal year decreased 12.9% from a year ago, to ¥3,890 million. However, net
income for the fiscal year increased 53.7% from a year ago, to ¥984 million.

61. Fees and commissions received
Total fees and commissions received declined 1.0% from the previous fiscal year to ¥39,947 million. The
breakdown into major categories was as follows.
（1） Brokerage commissions
In the fiscal year, average daily turnover on the Tokyo Stock Exchange (Japanese common stocks) was 2,112
million shares, down 6.7%, and ¥1,304.9 billion, down 16.0%. The decline in Japanese equity market trading
volumes meant that our stock brokerage commissions decreased 18.1% from the previous year to ¥8,798
million. Bond brokerage commissions were down 3.3% to ¥18 million. Other brokerage commissions fell
14.0% to ¥1,064 million, so total brokerage commissions were 17.7% lower at ¥9,881 million.
（2） Underwriting fees, selling concessions, and commissions on solicitation for sales of financial
instruments to specified investors and others
There were no major deals in the fiscal year involving IPOs or POs for listed companies, so underwriting
fees and commissions declined, with those for equities down 83.0% from the previous year to ¥55 million.
The company acted as lead manager for issues of government guaranteed bonds and municipal bonds,
but decline in issuance of bonds by electric power companies and the debt crisis in Europe caused bondunderwriting fees to fall 17.8% to ¥66 million. As a result, total underwriting fees, selling concessions, andcommissions on solicitation for sales of financial instruments to specific investors declined 70.0% to ¥121
million.
（3） Administrative charges on offering, selling and solicitation for sales of financial instruments tospecified investors, and other fees and commissions received
Investment trust funds are the revenue drivers of this category.
In the fiscal year, the company made an effort to build up assets under custody and focused on marketing
existing funds in Asia and Oceania equities, bonds and high-yielding emerging market equities, as wellas introducing new funds investing in undervalued Japanese equities and Asian growth stocks in order toexpand the product lineup.
As a result, administrative charges on offering, selling and solicitation for sale of financial instrument tospecified investors grew 12.3% from the previous year to ¥18,110 million. Other fees and commissions
received were flat at ¥11,835 million, thanks to administrative charges for investment trusts and salescommission for insurance policies such as variable annuities.

7

Fees and Commissions received(Millions of yen except percentage)

Breakdown by category
2012<A>Brokerage commissions

2011<B>(4/1/11 ～ 3/31/12)(4/1/10 ～ 3/31/11)

Ratio<A>/<B>¥ 9,881¥ 12,005

82.3

Equities

8,798

10,748

81.9

Bonds

18

19

96.7

Others

1,065

1,238

86.0

Underwriting fees and selling concessions

121

404

30.0

Equities

55

324

17.0

Bonds

66

80

82.2

Placement commissions

18,11016,131

112.3

Other commissions

11,835

11,831100.0¥ 39,947¥ 40,370

99.0

Total

'08 '09 '10 '11 '12(Millions of yen except percentage)

Breakdown by Product2012<A>

Equities
Bonds

2011<B>

Ratio(4/1/11 ～ 3/31/12)(4/1/10 ～ 3/31/11)¥ 9,148¥ 11,346

80.6

203

201

100.8

<A>/<B>

Investment trusts

29,041

27,051

107.4

Others

1,555

1,772

87.7

Total

¥ 39,947¥ 40,370

99.0

2. Trading profits
While computer-related stocks performed strongly thanks quantitative easing that started the previous year in
the US, credit instability resulting from the European debt crisis caused weakness in Asian markets, so foreign
equity volumes declined, and profits on equity trading fell 27.7% to ¥6,971 million.
In contrast, bond trading profits rose 18.4% from the previous fiscal year to ¥11,058 million, thanks to themarketing of high yielding foreign currency bonds that were well suited to customers' requirements. Total trading
profits, including ¥44 million of other trading profits (down 60.3%), declined 5.4% to ¥18,073 million.
(Millions of yen except percentage)

Trading profit/loss
2012<A>(4/1/11 ～ 3/31/12)

2011<B>(4/1/10 ～ 3/31/11)

Ratio<A>/<B>

Equities, etc.

¥ 6,971¥ 9,645

72.3

Bonds, etc.

11,058

9,342

118.4

44

112

39.7

¥ 18,073¥ 19,100

94.6

OthersTotal'08 '09 '10 '11 '12

3. Net financial income
Financial income declined 12.8% to ¥1,988 million, while financial expenses fell modestly 5.4% to ¥1,598 million,
so net financial income was down 34.1% to ¥390 million.
4. Other operating income
Operating income from operations other than the financial instrument exchange business or incidental businessdeclined 12.9% from the previous fiscal year to ¥1,058 million.

85. Selling, general and administrative expenses
Administrative expenses and depreciation rose, but selling, general and administrative expenses fell 2.7%, to¥56,315 million, overall due to decline in personnel, trading related expenses and the like.
6. Other income (expenses)
Other income was ¥791 million, an improvement from the ¥1,148 million expenses of the previous fiscal year,
mainly because of the absence of provisioning against doubtful accounts for the purpose of accommodating
a fund shortfall related to failed settlements against customers resulting from the plunge in the equity market
triggered by the Great East Japan Earthquake.
7. Dividends
We regard returns to shareholders as a management priority. While ensuring that sufficient earnings are
retained to strengthen management and achieve future development, we pay dividends according to the Group's
performance, with the intention of maintaining steady dividends.
For fiscal 2012 we proposed a ¥5.0 dividend per share to shareholders, according to the dividend policy
mentioned above.

Ⅱ．Analysis of financial position
1. Assets, liabilities and net assets
Total assets at the end of the fiscal year were ¥13,851 million higher year on year, at ¥556,389 million. This was
mainly because receivables on collateralized securities transactions increased by ¥18,565 million and trading
assets rose ¥3,155 million, while cash segregated as deposits fell ¥5,303 million and margin trading assets
declined ¥2,713 million.
Total liabilities increased ¥14,458 million to ¥444,373 million. This was mainly due to increases of ¥32,342
million in payables on collateralized securities transactions and ¥27,837 million in trading liabilities, which wereoffset by decreases of ¥24,418 million in payables arising from unsettled trades, ¥10,115 million in short-termborrowing, ¥4,391 million in guarantee deposits received and ¥3,250 million in payables on margin transactions.
Net assets decreased ¥607 million to ¥112,016 million. This was mainly because of a ¥732 million decline due
to share buybacks.
2. Cash flows
Cash and cash equivalents (hereinafter “cash”) increased by ¥2,682 million to ¥41,022 million at the end of the
fiscal year. Change in each cash flow item was as follows.
<Cash flows from operating activities>
Cash inflows from operating activities were ¥18,243 million. This was mainly due to net change of ¥13,777
million in payables and receivables on collateralized securities transactions, and a decline of ¥5.2 billion in cash
segregated as deposits for customers.
<Cash flows from investing activities>
Cash used for investing activities was ¥1,403 million. This was mainly due to the acquisition of ¥960 million
intangible fixed assets and ¥474 million tangible fixed assets.
<Cash flows from financing activities>
Cash used for financing activities was ¥14,132 million. This was mainly due to a decrease in short-termborrowing of ¥9,741 million and the repayment of ¥2,307 million long-term borrowings.

9

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Balance Sheet ─ March 31, 2012

Thousands of
U.S. dollars(note 3)

Millions of yen
2012

2011

2012

ASSETS
Current assets:
Cash on hand and in banks (notes 10 and 21)¥

45,898¥43,340$558,438

Cash segregated as deposits for customers and others

42,75048,053

520,136

Trading assets (notes 4 and 10)

185,668

182,5132,259,010

Receivables on margin transactions (note 5)

33,53336,247

407,994

Receivables on collateralized securities transactions (note 6)

186,087

167,5222,264,107

3,566

3,298

43,387

Short-term investments (note 7)
Deferred income taxes (note 11)

854

848

10,391Other current assets

6,951

7,576

84,572

(3)

(7)

(37)

Total current assets

505,304

489,390

6,147,998

Property and equipment, net of accumulated
depreciation of ¥11,115 million ( $135,235 thousand) in 2012 and¥10,849 million in 2011 (note 10)

16,305

16,438198,382

Intangible assets, net

8,400

9,386

102,202

Investment securities (notes 7, 8 and 10)

18,90819,463230,052

Long-term guarantee deposits

3,543

3,540

43,107

Deferred income taxes (note 11)

2,345

2,471

28,532

Other

4,348

5,267

52,902

Allowance for doubtful accounts(2,764)(3,418)(33,629)

26,38027,323320,964

Allowance for doubtful accounts

Investments and other assets:

Total investments and other assets
TOTAL

¥

See accompanying notes to consolidated financial statements.

10556,389¥542,537$

6,769,546

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Balance Sheet ─ (Continued) ─ March 31, 2012

LIABILITIES AND NET ASSETS
Current liabilities:
Trading liabilities (note 4)
Payables arising from unsettled trades
Payables on margin transactions (notes 5 and 10)
Payables on collateralized securities transactions (note 6)
Deposits received
Guarantee deposits received
Short-term borrowings (notes 9 and 10)
Income tax payables (note 11)
Other current liabilities (notes 9 and 11)
Total current liabilities

2012

¥

Millions of yen

152,268
4,058
16,172
61,367
18,33822,996
136,168961
5,454
417,782¥

Thousands of
U.S. dollars(note 3)
2012

2011

124,430
28,476
19,42329,024
20,187
27,388146,283
1,117
5,279
401,607$

1,852,634
49,373
196,764
746,648
223,117
279,791
1,656,747
11,692
66,3585,083,124

Non-current liabilities:
Long-term borrowings (notes 9 and 10)
Lease liabilities (note 9)
Deferred income taxes (note 11)
Retirement and severance benefits (note 12)
Other non-current liabilities
Total non-current liabilities

13,478
696
1,651
6,515
2,860
25,20015,343
705
1,880
6,262
2,906
27,096

163,986
8,468
20,08879,26834,797
306,607

Financial instruments transactions reserve (note 14)
Total liabilities

1,391
444,373

1,211
429,914

16,924
5,406,655

Net assets
Shareholders' equity (note 15):
Common stock
Authorized − 750,000,000 shares in 2012 and 2011
Issued − 208,214,969 shares in 2012 and 2011
Capital surplus
Retained earnings
Treasury stock, at cost, 9,936,084 shares in 2012 and 7,095,507
shares in 2011
Total shareholders' equity

18,59012,91164,49018,59012,91164,496226,183
157,087784,645(3,582)
92,409(2,850)93,147(43,581)
1,124,334

Accumulated other comprehensive income (loss):
Unrealized gain on available-for-sale securities (note 7)
Surplus on land revaluation (note 16)
Foreign currency translation adjustments
Total accumulated other comprehensive income

564
327
(840)
51

586
270
(811)
45

6,862
3,979
(10,220)621

Minority interests

19,556

19,431

237,936

112,016

112,623

1,362,891

Total net assets
Commitments and contingencies (note 22)
TOTAL

¥

See accompanying notes to consolidated financial statements.

11556,389¥542,537$

6,769,546

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Statement of Income ─ Year ended March 31, 2012
Thousands of
U.S. dollars(note 3)

Millions of yen
2012

2011

2012

Operating revenues:
Commissions¥

39,947¥40,370$486,032

Net gain on trading

18,073

19,100219,893

Interest and dividend income

1,988

2,280

24,188Service fee and other revenues

1,057

1,214

12,861

61,06562,964

742,974

Interest expense

1,598

1,688

19,443

Net operating revenues

59,467

61,276

723,531

Selling, general and administrative expenses (note18)

56,31557,867685,181

3,152

3,409

38,350Operating income
Other income (expenses):Dividend income

509

443

6,193

Gain on sale of investment securities

208

453

2,531

Negative goodwill

279

166

3,395

Interest expense

(96)

(119)

(1,168)Loss on devaluation of investment securities

(120)

(400)

(1,460)

Provision for financial instruments transactions reserve

(179)

(356)

(2,178)Cumulative effect on prior years of adoption of new accounting
standard for asset retirement obligations (note 13)

-

(343)

-

Provision for doubtful accounts-(1,702)-Other, net
Income before income taxes and minority interests

189

710

2,299

790

(1,148)

9,612

3,942

2,261

47,962

2,165

2,571

26,341-(1,585)-

Income taxes (note 11):
Current
Refund of income taxes
DeferredIncome before minority interests
Minority interests
Net income¥

See accompanying notes to consolidated financial statements.

12

209

35

2,543

2,374

1,021

28,884

1,568

1,240

19,078

584

600

7,106

984

¥

640

$

11,972

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Statement of Comprehensive Income (Loss) ─ Year ended March 31, 2012
Thousands of
U.S. dollars(note 3)

Millions of yen
2012
Income before minority interests

¥

2011

1,568

¥

2012

1,240

$

19,078Other comprehensive income (loss) (note 19):
Unrealized gain (loss) on available-for-sale securities

4(1,038)49

Surplus on land revaluation

229

-

2,786

Foreign currency translation adjustments

(30)

(334)

(365)

203

(1,372)

2,470

Total other comprehensive income (loss)
Comprehensive income (loss)

¥

1,771

¥

(132)

$

21,548

¥

990

¥

(663)

$

12,045Comprehensive income (loss) attributable to:
Owners of parent
Minority interests

781

See accompanying notes to consolidated financial statements.

13

531

9,503

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Statement of Changes in Net Assets ─ Year ended March 31, 2012

Commonstock
Balances at March 31, 2010¥

Changes arising during the year:
Decrease of capital surplus resulting fromchanges in interest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Increase of treasury stock resulting fromchanges in interest in consolidated
subsidiaries
Net changes other than shareholders' equity
Total changes during the year¥

12,919¥65,363¥(1,877)

Total
shareholders'equity¥(8)

Changes arising during the year:
Increase of capital surplus resulting fromchanges in interest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasury stock
Increase of treasury stock resulting fromchanges in interest in consolidated
subsidiaries
Net changes other than shareholders' equity
Total changes during the year(953)

(1,507)
640
(953)

(20)

(20)

-

(8)

(867)

(973)

(1,848)18,59012,91164,496(2,850)93,147

1

1
(989)
984

(1)

¥

94,995(8)(1,507)
640

Balances at March 31, 2011

Balances at March 31, 2012

18,590CapitalsurplusMillions of yen
Shareholders' equity
Treasury
Retainedstock,
earnings
at cost18,590

14

(1)

(0)
¥

12,911(6)¥

64,490

¥

(707)
4

(989)
984
(707)
2

(29)

(29)

(732)

(738)

(3,582)¥

92,409

Millions of yen
Accumulated other comprehensive income (loss)
Unrealized
Totalgain onaccumulated
Foreignavailableother
Surplus on
currency
for-salecomprehensive
landtranslation
securities
income (loss)
revaluation
adjustments
Balances at March 31, 2010¥

1,556 ¥

235

¥

(476)

¥

1,315

Minority
interests¥

19,268

Total net
assets¥

115,578

Changes arising during the year:
Decrease of capital surplus
resulting from changes ininterest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Increase of treasury stock
resulting from changes ininterest in consolidated
subsidiaries
Net changes other thanshareholders' equity
Total changes during the year

(970)
(970)

35
35

(335)
(335)

(1,270)(1,270)163
163(1,107)(2,955)

Balances at March 31, 2011

586

270

(811)

45

19,431

112,623(8)(1,507)
640
(953)

(20)

Changes arising during the year:
Increase of capital surplus
resulting from changes ininterest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasury stock
Increase of treasury stock
resulting from changes ininterest in consolidated
subsidiaries
Net changes other thanshareholders' equity
Total changes during the year
Balances at March 31, 2012

1
(989)
984
(707)
2

(29)

¥

(22)
(22)

57
57

564 ¥

327

15

(29)
(29)
¥

(840)

6
6
¥

51

125
125
¥

19,556

131
(607)
¥

112,016

Thousands of U.S. dollars(note 3)
Shareholders' equity
Commonstock
Balances at March 31, 2011$

226,183

Changes arising during the year:
Increase of capital surplus
resulting from changes ininterest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasury stock
Increase of treasury stock
resulting from changes ininterest in consolidated
subsidiaries
Net changes other thanshareholders' equity
Total changes during the year
Balances at March 31, 2012

Capitalsurplus$Retainedearnings

157,087$784,71812$

226,183

157,087(73)$784,645$$

Changes arising during the year:
Increase of capital surplus
resulting from changes ininterest in consolidated
subsidiaries
Cash dividends
Net income
Purchase of treasury stock
Disposition of treasury stock
Increase of treasury stock
resulting from changes ininterest in consolidated
subsidiaries
Net changes other thanshareholders' equity
Total changes during the year
Balances at March 31, 2012

7,130

$

3,285 $

(9,867) $

548 $

$

1,133,313(8,602)49

12(12,033)
11,972(8,602)
25

(353)

(353)

(8,906)(8,979)(43,581)

Thousands of U.S. dollars(note 3)
Accumulated other comprehensive income (loss)
Unrealized
Totalgain onaccumulated
Foreignavailable-for- Surplus onothercurrencysale
landtranslation comprehensive
securities
revaluation adjustments income (loss)
Balances at March 31, 2011

Total
shareholders'equity(34,675)

(12)

(0)
$

$

(12,033)
11,972(12)-

Treasurystock,
at cost$Minority
interests
236,416 $1,124,334

Total net
assets
1,370,277

12(12,033)
11,972(8,602)
25

(353)
(268)
(268)
$

6,862

$

694
694

(353)
(353)

73
73

1,520
1,520

1,593
(7,386)

3,979 $

(10,220) $621 $237,936 $

1,362,891

See accompanying notes to consolidated financial statements.

16

Okasan Securities Group Inc. and Consolidated Subsidiaries
Consolidated Statement of Cash Flows ─ Year ended March 31, 2012

Cash flows from operating activities:
Income before income taxes and minority interests¥
Adjustments to reconcile income before income taxes andminority interests to net cash provided by operating
activities:
Depreciation and amortization
Cumulative effect on prior years of adoption of new accounting
standard for asset retirement obligations
Interest and dividend income
Interest expense
Gain on sale of investment securities
Loss on devaluation of investment securities
Negative goodwill incurred
Decrease (increase) in deposits segregated for customer
Decrease (increase) in trading assets and increase (decrease) intrading liabilities
Decrease (increase) in receivables on margin transactions andincrease (decrease) in payables on margin transactions
Decrease (increase) in receivables on collateralized securities
transactions and increase (decrease) in payables oncollateralized securities transactions
Increase (decrease) in deposits received
Decrease (increase) in short-term guarantee deposits
Increase (decrease) in guarantee deposits received
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in retirement and severance benefits
Increase (decrease) in financial instruments transactions reserve
Other, net
Sub-totalInterest and dividend received
Interest paid
Income taxes paid
Net cash provided by operating activities

Thousands of
U.S. dollars(note 3)2012

Millions of yen
2012
2011
3,942

¥

2,261

$

47,962

3,939

3,828

47,926(2,503)
1,694
(174)
120
(279)
5,200

343
(2,735)
1,808
(450)
400
(166)
9,700

(30,454)
20,611(2,117)1,460(3,395)63,268264

25,203

3,212

(538)

2,129

(6,546)

13,777(1,830)(52)(4,391)
(657)
254
179
823
19,7682,404(1,680)(2,249)18,243(34,253)(2,479)337(2,359)
1,524
105
356
(2,686)
2,866
2,782(1,812)(2,380)1,456

167,624(22,265)(633)(53,425)(7,994)
3,090
2,178
10,013
240,515
29,249(20,440)(27,363)
221,961

Cash flows from investing activities:
Payment for short-term investments
Proceeds from sale of short-term investments
Payment for purchase of property and equipment
Payment for intangible assets
Payment for investment securities
Proceeds from sale of investment securities
Payment for investments in affiliates
Other, net
Net cash used in investing activities(3,896)
3,900
(474)
(960)
(617)
904
(368)
108
(1,403)(4,498)1,200(896)(1,489)(1,039)
1,245
(144)
(23)
(5,644)(47,402)47,451(5,767)(11,680)(7,507)
10,999(4,478)1,314(17,070)

Cash flows from financing activities:
Increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Payments on long-term borrowings
Purchase of treasury stock
Dividends paid to shareholders
Dividends paid to minority shareholders of subsidiaries
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net increase in cash and cash equivalents
Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year (note 21)(9,741)70(2,307)
(707)
(989)
(38)
(420)
(14,132)(26)
2,682
38,34041,022
¥

6,155
9,200
(5,998)(953)(1,507)
(42)
(306)
6,549
(271)
2,090
36,25038,340(118,518)852(28,069)(8,602)(12,033)(463)(5,110)(171,943)(316)
32,632
466,480
499,112

See accompanying notes to consolidated financial statements.

17

¥

$

Notes to Consolidated Financial Statements
Okasan Securities Group Inc. and Consolidated Subsidiaries ─ Year ended March 31, 2012
1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements include the accounts of Okasan Securities Group Inc.
(the "Company") and its subsidiaries.
The Company and its domestic subsidiaries maintain their books of account and prepare their financial
statements in conformity with financial accounting standards of Japan, and its foreign subsidiary inconformity with those of the country of its domicile.
"Practical Solution on unification of Accounting Policies Applied to Foreign Subsidiaries for Consolidated
Financial Statements" (ASBJ Practical Issues Task Force (PITF) No. 18, May 17, 2006) requires that for the
preparation of consolidated financial statements, the accounting policies and procedures applied to a parent
company and its subsidiaries for similar transactions and events under similar circumstances should be
unified, in principle, and financial statements prepared by foreign subsidiaries in accordance with IFRSs
or the generally accepted accounting principles in the United States (U.S. GAAP) tentatively may be used
for the consolidation process, however, the items listed in the PITF should be adjusted in the consolidation
process so that net income is accounted for in accordance with Japan GAAP unless they are not material.
The Company made necessary modification to the consolidated financial statements according to the PITF.
The accompanying consolidated financial statements have been prepared in accordance with the provisions
set forth in the Japanese Financial Instruments and Exchange Law and its related accounting regulations,and in conformity with accounting principles and practices generally accepted in Japan and applicable to
Japanese securities companies.
In preparing the accompanying consolidated financial statements, certain reclassifications have been madein the financial statements issued domestically in Japan in order to present them in a form which is morefamiliar to readers outside Japan. In addition, the notes to the consolidated financial statements include
information which is not required under accounting principles generally accepted in Japan but is presented
herein as additional information.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESa.	Consolidation − The consolidated financial statements include the accounts of the Company and its 10
subsidiaries. There are no affiliates accounted for by equity method.
The "Accounting Standards for Consolidation" require the control or influence concept for the
consolidation scope of subsidiaries and affiliates. Under the control or influence concept, a company inwhich the Company or its consolidated subsidiaries, directly or indirectly, are able to exercise control
over operations is fully consolidated, and a company over which the Company and/or its consolidated
subsidiaries have the ability to exercise significant influence is accounted for by the equity method.
Investments in affiliates are accounted for by the equity method. The difference between the cost andthe underlying net assets at the date of investments in subsidiaries or affiliates is allocated to identifiable
assets and liabilities based on fair market value at the date of investments. The unallocated portion of
the difference is recognized as goodwill or negative goodwill. Goodwill is amortized over its estimatedperiod of benefit on a straight-line basis and negative goodwill is amortized over the appropriate period
to reflect the investments, while immaterial goodwill or negative goodwill is charged to income whenincurred.
All significant intercompany balances and transactions have been eliminated in consolidation.

18

b.	Cash and cash equivalents − For the purposes of the statement of cash flows, the Company considers
all highly liquid investments with insignificant risk of changes in value which have maturities ofgenerally three months or less when purchased to be cash equivalents.
c.	Trading assets and liabilities − Trading assets and liabilities, including securities and financial
derivatives for trading purposes are recorded on a trade date basis at fair value. Revenues andexpenses related to trading securities transactions are recorded on a trade date basis. Changes in thefair values are reflected in "net gain on trading" in the accompanying consolidated statement of income.
Gains and losses arose from derivatives held or issued for trading purposes are also reported as "netgain on trading" in the accompanying consolidated statement of income, which includes realized gains
and losses as well as changes in the fair values of such instruments. Securities owned for non-trading
purposes, shown in the accompanying consolidated balance sheet as "Short-term investments" and"Investment securities" are discussed below.
d.	Securities − The Company examines the intent of holding securities for non-trading purposes, andclassifies those securities as (a) debt securities intended to be held to maturity ("held-to-maturity debt
securities"), (b) equity securities issued by an affiliated company and (c) all other securities not classified
in any of the above categories ("available-for-sale securities").
Held-to-maturity debt securities are stated at amortized cost. Available-for-sale securities with market
value are stated at market, based on quoted market prices. Realized gains and losses on sale of suchsecurities are computed using the gross-average cost. Unrealized gains or losses on such securities, netof related taxes, are recorded in other accumulated comprehensive income. Debt securities classified
as "available-for-sale securities" for which fair value is not available are stated at the amortized cost.
Equity securities classified as "available-for-sale securities" for which market value is not available arestated at the gross-average cost.
e. 	Hedging transactions − The Company states derivative financial instruments at fair value andrecognize changes in the fair value as gains or losses unless derivative financial instruments are used
for hedging purposes. Valuation gains or losses on hedging instruments are mainly deferred as assets
or liabilities until the gains or losses on underlying hedged instruments are realized. The Company
and certain subsidiaries have entered into interest rate swap agreements for hedging interest rate
exposures. The difference in amounts to be paid or received on interest rate swap agreements is
recognized over the life of the agreement as an adjustment to interest expense.
f. Collateralized securities transactions − Collateralized securities transactions consist of securities
borrowed and loaned transactions and Gensaki transactions. Securities borrowed transactions
generally require the Company to provide the counterparty with collateral in the form of cash. And
securities loaned transactions, the Company generally receives collateral in the form of cash. The
Company monitors the market value of the securities borrowed or loaned and requires additional
cash, as necessary, to ensure that such transactions are adequately collateralized. Under the "Uniform
Accounting Standards of Securities Companies", securities borrowed and loaned transactions areaccounted for as financing transactions. Securities borrowed or loaned that are cash collateralized
are recorded at the amount of cash collateral advanced or received. Gensaki transactions originate
in the Japanese financial markets, and involve the selling ("Sell Gensaki")/purchasing ("Buy Gensaki")of commercial paper, certificates of deposit, Japanese government bonds and various other debt
securities to/from an institution wishing to make a short-term investment, with the Company agreeing
to repurchase/resell them from/to the institution on a specified date at a specified price. Under the"Accounting Standards for Financial Instruments", Gensaki transactions are accounted for as financing
transactions. Gensaki transactions are carried at their contractual amounts.
g.	Allowance for doubtful accounts − Allowance for doubtful accounts of the Company and its domestic
consolidated subsidiaries are provided on the estimated historical deterioration rate for normal accounts,
and based on specifically assessed amounts for doubtful accounts. An overseas consolidated subsidiary
provides specifically assessed amount for doubtful accounts.

19h.	Property and equipment − Property and equipment are stated at cost. Depreciation of property
and equipment of the Company and its domestic consolidated subsidiaries is computed substantiallyby the declining-balance method at rates based on the estimated useful lives of the assets, while thestraight-line method is applied to buildings purchased in Japan after April 1, 1998. And in an overseas
subsidiary, depreciation is computed by the straight-line method. The range of useful lives is principallyfrom 3 to 50 years for buildings and from 3 to 15 years for equipment.
i.	Intangible assets − Intangible assets are carried at cost less amortization. Software for internal use isamortized under straight-line method based on internally estimated useful life (5 years). Amortization ofother intangible assets is calculated by the straight-line method at rates based on the estimated useful
lives of respective assets.
j.	Retirement and severance benefits − The Company and its domestic consolidated subsidiaries havecontributory and noncontributory pension plans, and unfunded retirement and severance plans toprovide retirement and severance benefits to substantially all employees.
Under the "Accounting Standards for Retirement Benefits", provisions for defined benefit retirement
and pension plans have been made in the accompanying consolidated financial statements based on
the present value of the projected future retirement and severance benefits attributable to employee
services rendered by the end of the year, less amounts funded under contributory and noncontributory
pension plans.
The Company and its domestic consolidated subsidiaries have unfunded defined benefit pension plansfor directors and corporate auditors. The provision for the plans has been made in the accompanying
consolidated financial statements for vested benefits to which directors and corporate auditors areentitled if they were to retire and sever immediately at the balance sheet date.
k.	Leases − Leased assets related to finance lease transactions without title transfer are depreciated on astraight-line basis, with the lease periods as their useful lives and no residual value. Regarding financeleases transactions without title transfer for which the starting date for the lease transactions is prior to
March 31, 2008, the Company and its domestic consolidated subsidiaries have continued recognize lease
payments as expenses.
l.	Income taxes − Income taxes in Japan applicable to the Company and its domestic consolidated
subsidiaries consist of corporate tax, inhabitant tax and business tax.
The "Accounting Standards for Income Taxes" require that deferred income taxes be accounted forunder the asset and liability method. Deferred tax assets and liabilities are recognized for the expected
future tax consequences of events that have been included on the financial statements or tax return.
Under this method, deferred tax assets and liabilities are measured using enacted tax rates expected toapply to taxable income in the years in which those temporary difference are expected to be recoveredor settled, and the effect on deferred tax assets and liabilities of a change in tax rates is recognized inincome in the period that includes the enactment date.
The Company has filed consolidated tax returns in Japan.
m.	Foreign currency transactions − Under the "Accounting Standards for Foreign Currency
Transactions," receivables and payables denominated in foreign currencies are translated into yen at
the rate of exchange as of the balance sheet dates and gains or losses resulting from the translation offoreign currencies are credited or charged to income. Assets and liabilities, and revenues and expensesof an overseas subsidiary are translated into yen at the rate of exchange as of the balance sheet dates,
a comprehensive adjustment resulting from translation is presented as "Foreign currency translation
adjustments" in a component of net assets.
n.	Asset retirement obligations − The Company recognizes an asset retirement obligation which
is a statutory or similar obligation with regard to the removal of assets as a liability. An asset
retirement obligation is recognized as a liability at the time that the asset is incurred by its acquisition,
construction, development or ordinary use. When an asset retirement obligation is recognized as aliability, the asset retirement cost corresponding to it is included in the cost of the relevant asset by the20same amount.

o.	Accounting Changes and Error Corrections − From the year ended March 31, 2012, the Company
applied "the Accounting Standard for Accounting Changes and Error Corrections" (ASBJ Statement
No.24, December 4, 2009) and "the Guidance on Accounting Standard for Accounting Changes and Error
Corrections" (ASBJ Guidance No.24, December 4, 2009).
The Standard and the Guidance prescribe (a) treatment in principle for changes in accounting policies,(b) treatment for changes in presentations, (c) treatment for changes in accounting estimates, and (d)treatment for corrections of prior period errors.
p.	Reclassifications − Certain reclassifications have been made to the prior years' consolidated financial
statements to conform to the presentation used in consolidated statements as of and for the year ended
March 31, 2012.

3. BASIS OF FINANCIAL STATEMENT TRANSLATION
The translations of the yen amounts into U.S. dollars are included solely for the convenience of the reader,using the prevailing exchange rate at March 30, 2012, which was ¥82.19 to U.S. $1.
The convenience translations should not be construed as representations that the yen amounts have been,
could have been, or could in the future be, converted into U.S. dollars at this or any other rate of exchange.

4. TRADING ASSETS AND LIABILITIES
Trading assets and trading liabilities at March 31, 2012 and 2011 consist of the following:Thousands of
U.S. dollars

Millions of yen
2012

2011

2012

Trading assets:
Equity securities and warrants¥

Government, corporate and other bonds
Commercial paper and certificates of deposit
Derivatives

1,327

¥

1,140

$

16,146

180,313

177,871

2,193,856

3,998

3,498

48,643

30

4

365

¥

185,668¥

182,513$2,259,010

¥

940

¥

962

$

11,437

Trading liabilities:
Equity securities and warrants
Government, corporate and other bonds
Commercial paper and certificates of deposit
Derivatives

147,312

119,912

1,792,335

3,999

3,497

48,65517¥

21

152,268

59¥

124,430207$

1,852,634

5. MARGIN TRANSACTIONS
Margin transactions at March 31, 2012 and 2011 consist of the following:Thousands of
U.S. dollars

Millions of yen
2012

2011

2012

Assets:Loans receivable from customers¥

26,164¥33,533

Cash deposits as collateral for securities borrowed fromsecurities finance companies¥

29,837$318,336¥

36,247$

407,994

¥

8,795

$

52,318¥19,423$

196,764

7,369

6,410

89,658

Liabilities:
Borrowings from securities finance companies

¥

4,300

¥

16,172

Proceeds from securities sold for customers' accounts

11,872

10,628144,446

Loans receivable from customers are stated at amounts equal to the purchase price of the relevant
securities, which are collateralized by customers' securities and customers' deposits in the form of cash
or securities. Proceeds from securities sold for customers' accounts are stated at the sales prices of therelevant securities on the respective transaction dates.

6. COLLATERALIZED SECURITIES TRANSACTIONSCollateralized securities transactions at March 31, 2012 and 2011 consist of the following:Thousands of
U.S. dollars

Millions of yen
2012

2011

2012

Assets:Cash collateral for securities borrowed¥

186,087¥

167,522$2,264,107¥

61,367¥

26,784$

746,648

Liabilities:
Cash collateral for securities loaned
Sell Gensaki transactions¥

22

61,3672,240¥

29,024$

746,648

7. SECURITIES FOR NON-TRADING PURPOSES
Acquisition cost, balance sheet amount, gross unrealized gain and gross unrealized loss of available-for-salesecurities with fair value at March 31, 2012 and 2011 is summarized as follows:

Millions of yen
Acquisition
cost

Gross
unrealized gainGrossunrealized loss

Balance sheet
amount¥¥¥

At March 31, 2012
Current:
Government, corporate and other bonds

¥

3,298

Other

-

270

-

-

3,298

(2)

268

¥

3,568

¥

-

¥

(2)

¥

3,566

¥

11,581

¥

3,571

¥

(2,285)¥

12,867

Non-current:
Equity securities
Government, corporate and other bonds

298

Other

16

759

-

13

314

(29)

743

¥

12,638

¥

3,600

¥

(2,314)¥

13,924

¥

3,298

¥

-

¥

-

¥

3,298

¥

11,354

¥

3,302

¥

(2,057)¥

12,599At March 31, 2011
Current:
Government, corporate and other bonds
Non-current:
Equity securities
Government, corporate and other bonds

298

Other

15

1,432
¥

13,084

-

126
¥

3,443

313

(25)
¥

(2,082)

1,533¥

14,445

Thousands of U.S. dollars
Acquisition
cost

Gross
unrealized gainGrossunrealized loss$$

Balance sheet
amount

At March 31, 2012
Current:
Government, corporate and other bonds

$

Other

40,126
3,285

-

-

$

(24)

40,126
3,261$

43,411

$

-

$

(24)

$

43,387$140,905$

43,448$(27,801)$

156,552

Non-current:
Equity securities
Government, corporate and other bonds

3,626

194

-

3,820

Other

9,235

158

(353)

9,040

$

153,766$

43,800$(28,154)$

169,412Securities classified as available-for-sale securities for which fair value is not available are unlisted equity
securities amounting to ¥4,813 million ( $58,559 thousand) and ¥4,725 million, and investments in limited
partnership and similar partnership amounting to ¥171 million ( $2,081 thousand) and ¥293 million at March
31, 2012 and 2011, respectively.
For the years ended March 31, 2012 and 2011, proceeds from sales of available-for-sale securities, grossrealized gains and gross realized losses are as follows:23

Millions of yen
Proceeds fromsales ofavailable-for-salesecurities

Gross realized
gains

Gross realized
lossesMarch 31, 2012
Equity securities

¥

60

¥

54

¥

(2)

Government, corporate and other bonds

3,900

-

-

Other

844

154

(32)

¥

4,804

¥

208

¥

(34)

¥

497

¥

450

¥

(1)

March 31, 2011
Equity securities
Government, corporate and other bonds

1,800

-

-

Other

148

3

(1)

¥

2,445

¥

453

¥

(2)

Thousands of U.S. dollars
Proceeds fromsales ofavailable-for-salesecurities

Gross realized
gains

Gross realized
lossesMarch 31, 2012
Equity securities$

Government, corporate and other bonds

730

$

657

47,451

Other

10,269$58,450

$

(24)

-

-

1,874
$

2,531

(390)
$

(414)

8. INVESTMENTS IN AN AFFILIATEThe aggregate carrying amount of investments in an affiliate at March 31, 2012 and 2011 are ¥22million ( $268
thousand) and ¥22 million, respectively.

9. BORROWINGS
The weighted-average interest rates applicable to the short-term borrowings are 0.61% at both March 31,
2012 and 2011.
Long-term borrowings at March 31, 2012 and 2011 consist of the following:Thousands ofBorrowings, maturing in installments through 2016; bearing
weighted average interest of 2.64% at March 31, 2012
Borrowings, maturing in installments through 2016; bearing
weighted average interest of 2.71% at March 31, 2011

Millions of yen
2012
2011
¥

Less current installments¥

24

15,413¥

U.S. dollars
2012
-

$

187,529-

17,650

-

1,935

2,307

23,543

13,478¥15,343$

163,986

Lease liabilities at March 31, 2012 and 2011 consist of the following:

Lease liabilities maturing in installments through 2017; bearing
weighted average interest of 3.38% at March 31, 2012
Lease liabilities maturing in installments through 2017; bearing
weighted average interest of 3.58% at March 31, 2011

Thousands of
U.S. dollars
2012

Millions of yen
2012
2011
¥

1,141 ¥-

Less current installments¥-$

13,882
-

1,059

445

354

696 ¥

705

5,414
$

8,468

(1)	Current installments of long-term borrowings are included in short-term borrowings in theaccompanying balance sheet.
(2)	Long-term borrowings included subordinated borrowings provided in Article 176 of the "Cabinet Office
Ordinance Concerning Financial Instruments Business" (the Prime Minister's Office Ordinance No. 52,
2007) as follows:

Current installments of long-term borrowings
Long-term borrowings¥

Millions of Yen
2012
2011
¥
1,850
7,900
7,900

Thousands of
U.S. dollars
2012$
96,119Millions ofyen

Thousands of
U.S. dollars

Annual maturities of borrowings after March 31, 2013, are as follows:Year ending March 31
2014
2015
2016
2017

¥

3,622
4,151
5,705
-

$

44,06950,50569,412-

Annual maturities of lease liabilities after March 31, 2013, are as follows:
Millions ofyenYear ending March 31
2014
2015
2016
2017

¥

311
186
136
52

Thousands of
U.S. dollars
$

3,784
2,263
1,655
633

To meet its liquidity needs stably and expeditiously and to strengthen financial operations, the Company
established a ¥22,000 million ( $267,672 thousand) and a ¥22,000 million commitment line contracts with
8 financial institutions at March 31, 2012 and 2011, respectively. There are no borrowings under thecommitment line contracts at both March 31, 2012 and 2011.
As is customary in Japan, both short-term and long-term bank borrowings are made under generalagreements which provide that security and guarantees for present and future indebtedness will be given
upon request of the bank, and that the bank shall have the right to offset cash deposits against obligations
that have become due or, in the event of default, against all obligations due the bank.

25

10. PLEDGED ASSETSAt March 31, 2012 and 2011, the carrying value of assets pledged is as follows:

Cash in banks
Trading assets
Property and equipment
Investment securities¥¥

Millions of Yen
2012
2011
3,873
¥
4,008
25,03328,8839,475
9,546
11,413
11,37549,794¥53,812Thousands of
U.S. dollars
2012$
47,122
304,575
115,282
138,861$
605,840

Millions of yen
2012
2011
34,750 ¥34,322
325
2,379
5,578
7,443
40,653 ¥44,144

Thousands of
U.S. dollars
2012$
422,801
3,954
67,867$494,622

Assets in the above table are pledged for the following liabilities:

Short-term borrowings
Borrowings from securities finance companies
Long-term borrowings¥¥

In addition to above, at March 31, 2012, trading assets, etc. amounting to ¥59,551 million ( $724,553
thousand) and investments securities amounting to ¥167 million ( $2,032 thousand) are deposited as
guarantee for settlement of trading accounts and securities borrowed, respectively. At March 31, 2011,
trading assets, etc. amounting to ¥60,098 million and investments securities amounting to ¥86 million aredeposited as guarantee for settlement of trading accounts and securities borrowed, respectively.
The fair value of the securities pledged as collateral at March 31, 2012 and 2011, except for those
disclosed in the above table, are as follows:

Securities loaned on margin transactions
Securities pledged for borrowings on margin transactions
Securities loaned
Other

¥

¥

Millions of yen
2012
2011
12,585¥
10,796
4,382
8,961
61,247
26,692
41,021
53,253
119,235¥
99,702Thousands of
U.S. dollars
2012$
153,12153,315745,188499,100$
1,450,724

The fair value of the securities received as collateral at March 31, 2012 and 2011 are as follows:

Securities received on margin transactions
Securities borrowed
Securities pledged as collateral
Other

¥

¥

Millions of Yen
2012
2011
25,343¥27,809191,039
172,425
29,21836,3967,530
6,806
253,130¥
243,436

Thousands of
U.S. dollars
2012$
308,347
2,324,358
355,493
91,617$3,079,815

11. INCOME TAXESThe Company and its domestic subsidiaries are subject to Japanese corporate, inhabitant and businesstaxes based on income which, in the aggregate, resulted in a statutory tax rate of approximately 40.5% in2012 and 2011.

26

The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred
tax assets and deferred tax liabilities at March 31, 2012 and 2011 are as follows:

Deferred tax assets:
Tax loss carryforwards
Retirement and severance benefits (employees)
Allowance for doubtful accounts
Accrued bonuses
Financial instruments transactions reserve
Retirement and severance benefits (directors and corporate
auditors)
Impairment loss
Asset retirement obligations
Loss on devaluation of investment securities
Depreciation and amortization
Loss on devaluation of golf memberships
Accrued business tax
Other

¥

Valuation allowance
Total
Deferred tax liabilities:
Unrealized gain on available-for-sale securities
Land revaluation excess
Other

Total

Net deferred tax assets

Thousands of
U.S. dollars
2012

Millions of yen
2012
2011

¥

3,162
1,887
889
601
494

¥

3,022
2,032
1,275
612
492

$

38,472
22,95910,816
7,312
6,010

456
363
324
244
142
142
116
299
9,119
(5,343)
3,776

497
393
347
270
192
220
153
305
9,810
(5,778)
4,032

5,548
4,417
3,942
2,969
1,728
1,728
1,411
3,638
110,950(65,008)
45,942(448)(1,650)(181)(2,279)
1,497

(506)
(1,879)(233)(2,618)1,414(5,451)(20,075)(2,202)(27,728)
18,214¥$

Net deferred tax assets at March 31, 2012 and 2011 are reflected in the accompanying consolidated balance
sheet under the following captions:

Current assets − Deferred income taxes
Investments and other assets − Deferred income taxes
Current liabilities − Other current liabilities
Non-current liabilities − Deferred income taxes¥¥

Millions of yen
2012
2011
854
¥
848
2,345
2,471
(51)
(25)
(1,651)(1,880)
1,497
¥
1,414

Thousands of
U.S. dollars
2012$
10,391
28,532(621)(20,088)$
18,214

A reconciliation of the statutory tax rate and the effective tax rate as a percentage of income before income
taxes and minority interests for the years ended March 31, 2012 and 2011 is as follows:
Statutory tax rate
Expenses not deductible for tax purposes
Income not credited for tax purposes
Per capita tax
Refund of income taxes
Valuation allowance
Expiration of tax loss carryforwards
Other
Decrease of deferred tax assets due to change in statutory tax rate
Effective tax rate

2012
40.5%
4.0
(1.6)
2.1
8.0
(2.5)
9.8
60.3%

2011
40.5%
7.7
(1.9)
3.5
(70.1)
55.3
9.4
0.7
45.1%

On December 2, 2011, the Japanese government issued "Act for Partial Revision of the Income Tax Act, etc.
for the Purpose of Creating Taxation System Responding to Changes in Economic and Social Structures" (ActNo. 114 of 2011) and "Act on Special Measures for Securing Financial Resources Necessary to Implement
Measures for Reconstruction following the Great East Japan Earthquake" (Act No.117 of 2011) . Under these27

newly promulgated laws, the statutory tax rate applicable for consolidated accounting years beginning on
or after April 1, 2012, will be changed.
Accompanying these changes, the effective statutory tax rate applicable to the calculation of deferred tax
assets and deferred tax liabilities will be changed.
As a result of these changes, the net deferred tax assets decreased by ¥326 million ( $3,966 thousand), theincome taxes-deferred increased by ¥387 million ( $4,708 thousand) and net unrealized gain on availablefor-sale securities increased by ¥61 million ( $742 thousand). The surplus on land revaluation increased by¥229 million ( $2,786 thousand) because the deferred tax liabilities related to surplus on land revaluation
decreased by ¥229 million ( $2,786 thousand).
12. RETIREMENT AND PENSION PLANS
The Company and its domestic consolidated subsidiaries have defined benefit retirement and pension plans,
which consist of a defined contribution retirement and pension plan (Securities Omnibus DC Okasan Plan),a corporate defined benefit pension plan and an unfunded retirement and severance plan that provide forlump-sum payment of benefits.
The funded status of retirement and pension plans at March 31, 2012 and 2011 consist of the followings:

Projected benefit obligations
Fair value of plan assets
Unrecognized actuarial gain
Amount recognized in the consolidated balance sheet¥¥

Millions of yen
2012
2011
(13,719)¥(12,244)
6,897
6,816
1,547
393
(5,275)¥(5,035)

Thousands of
U.S. dollars
2012$(166,918)
83,915
18,822$(64,181)

The components of net periodic benefit cost for the years ended March 2012 and 2011 are as follows:

Service cost
Interest cost
Expected return on plan assets
Recognized actuarial loss¥

Contributions to the defined contribution plan¥

Millions of yen
2012
2011
560
¥
564
238
238
(32)
(32)
221
92
987
862
181
184
1,168
¥
1,046

Thousands of
U.S. dollars
2012
$
6,813
2,896
(389)
2,689
12,0092,202$
14,211

Assumptions used for the years ended March 31, 2012 and 2011 are set forth as follows:
2012
Straight-line
0.99%
0.5%
5 years

Periodic allocation method for projected benefit
Discount rate
Expected rate of return on plan assets
Recognition period of actuarial gain / loss

2011
Straight-line
2.10%
0.5%
5 years

Directors and corporate auditors are not covered by the plans described above. For such persons, theCompany and certain consolidated subsidiaries have unfunded defined benefit pension plans. Under theplans, directors and corporate auditors are entitled to lump-sum payments based on the current rate of
pay and length of service when they leave the Company. The Company and certain domestic consolidated
subsidiaries provide for the amount of vested benefits to which directors and corporate auditors are entitled
if they were to retire or sever immediately at the balance sheet date. The liability for retirement andseverance benefits related to these plans was ¥1,240 million ( $15,087 thousand) and ¥1,226 million at March
31, 2012 and 2011, respectively.

2813. ASSET RETIREMENT OBLIGATIONS
The asset retirement obligation is based on estimated future restoration liabilities related to leasehold
contracts of branch offices and so on.
The obligation is calculated based on the estimated period of use of 2 to 58 years and discounted rate of
0.155% to 2.33% .
The following table provides the Company's total asset retirement obligation for the years ended March 31,
2012 and 2011:
Thousands of
U.S. dollars

Millions of yen
2012
Balance, beginning of year

¥

2011

532

¥

2012
490

$

6,473

Liabilities incurred by asset acquisition

37

66

450

Accretion expenses

11

10

134

Liabilities settled-

Balance, end of year

¥

580

(34)
¥

532

$

7,057

The above asset retirement obligation at the beginning of year 2011 was calculated by estimating theundiscounted future cash flow as of the beginning of the year and by using a discount rate.
14. FINANCIAL INSTRUMENTS TRANSACTIONS RESERVEThe Financial Instruments and Exchange Law of Japan requires a securities company to set aside areserve in proportion to its securities and other related trading or derivative transactions to cover possible
customer losses incurred by default of the securities company on securities or derivative transactions.
Financial instruments transactions reserve is calculated based on Article 46-5, Paragraph 1 of the Financial
Instruments and Exchange Law.

15. SHAREHOLDERS' EQUITYThe Companies Act provides that an amount equal to 10% of distributions from retained earnings paid by
the Company and its Japanese subsidiaries be appropriated as a legal reserve. No further appropriations
are required when the total amount of the additional paid-in capital and the legal reserve equals 25% of
their respective stated capital. The Companies Act also provides that additional paid-in capital and legal
reserve are available for appropriations by the resolution of the shareholders. Balances of the legal reserve
are included in retained earnings in the accompanying consolidated balance sheet.
Cash dividends and appropriations to the legal reserve charged to retained earnings for the years ended
March 31, 2012 and 2011 represent dividends paid out during those years and the related appropriations to
the legal reserve. The amount available for dividends is based on the amount recorded in the Company's
non-consolidated books of account in accordance with the Companies Act.
Dividends paid during the year ended March 31, 2011 which was approved by the General Meeting of
Shareholders held on June 29, 2010 are as follows:(a) Total dividends¥1,507 million(b) Cash dividends per common share¥7.5(c) Record date

March 31, 2010(d) Effective dateJune 30, 201029

Dividends paid during the year ended March 31, 2012 which was approved by the General Meeting of
Shareholders held on June 29, 2011 are as follows:(a) Total dividends¥989 million ( $12,033 thousand)(b) Cash dividends per common share¥5 ( $0.06)(c) Record date

March 31, 2011(d) Effective dateJune 30, 2011

Dividends to be paid after the balance sheet date but the record date for the payment belongs to the year
ended March 31, 2012 which was approved by the General Meeting of Shareholders held on June 28, 2012
are as follows:(a) Total dividends¥1,000 million ( $12,167 thousand)(b) Dividend source

Retained earnings(c) Cash dividends per common share¥5 ( $0.06)(d) Record date

March 31, 2012(e) Effective dateJune 29, 2012

16. SURPLUS ON LAND REVALUATIONAt March 31, 2002, a consolidated subsidiary revaluated its own land for business activities in accordancewith the "Law Concerning Land Revaluation" (the "Law") effective March 31, 1998. The net unrealized gain,
net of related taxes and minority interests, are reported as "Surplus on land revaluation" in a component of
net assets and the related deferred tax liabilities are included in non-current deferred income taxes.
Fair values of the land are determined based on the values specified in Article 2-1, 2-3 and 2-5 of the
Enforcement Ordinance of the Law concerning Land Revaluation.
The value of the land at March 31, 2012 decreased by ¥870 million ( $10,585 thousand) in comparison withthe book value of the land after the revaluation.

17. CAPITAL ADEQUACY REQUIREMENTS
In Japan, securities companies are subjected to risk-based capital adequacy rules established andadministered by the Financial Services Agency. Securities subsidiaries report their capital adequacy ratio
as defined pursuant to these rules. The authorities will take certain administrative measures if such ratio
declines below 140% . Capital adequacy ratios of Okasan Securities Co., Ltd. are 355.6% and 373.3% at
March 31, 2012 and 2011, respectively.

18. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Major elements of selling, general and administrative expenses for the years ended March 31, 2012 and2011 are summarized as follows:

Commissions and brokerage
Employees' compensation and benefits
Occupancy and rental
Data processing and office supplies
Depreciation and amortization
Taxes other than income taxes
Provision for doubtful accounts
Other

¥

¥

30

Millions of yen
2012
2011
10,304¥
10,934
27,64328,565
6,037
6,439
5,306
5,092
3,939
3,828
537
561
(6)
2,555
2,448
56,315¥57,867

Thousands of
U.S. dollars
2012$
125,368
336,330
73,45264,55847,9266,534(73)
31,086$685,18119. OTHER COMPREHENSIVE INCOME
The reclassification adjustment and the related income tax effects allocated to each component of othercomprehensive income (loss) for the year ended March 31, 2012 are as follows:
Millionsof yenThousands of
U.S. dollars

Net unrealized holding gain on other securities:
Arising during the year

¥

(35)

$

(426)

Reclassification adjustment

(21)

(255)

Before tax amount

(56)

(681)

Tax benefit

60

730

Net-of-tax amount

4

49

229

2,786

(30)

(365)

Surplus on land revaluation:
Tax benefit
Foreign currency translation adjustments:
Arising during the year
Total other comprehensive income

¥

203

$

2,470

20. PER SHARE INFORMATION(a) Net Income per Share
Basic net income per share, and reconciliation of the numbers and the amounts used in the basic net income
per share computations for the years ended March 31, 2012 and 2011 are as follows:
Yen
Basic net income per share¥

Net income
Net income not applicable to common shareholders
Net income applicable to common shareholders

¥
¥

2011
3.15

U.S. dollars
2012
$
0.06

Millions of yen
2012
2011
984
¥
640
984
¥
640

Thousands of
U.S. dollars
2012$
11,972$
11,972

2012
4.93

¥

Number of shares(Thousand)
2012
2011
Weighted average number of shares outstanding on which basic
net income per share is calculated

199,569

203,104(b) Net Assets per Share
Net assets per share, and reconciliation of the numbers and the amounts used in the net assets per sharecomputations at March 31, 2012 and 2011 are as follows:Yen
Net assets per share

¥

31

2012
466.31¥

2011
463.37

U.S. dollars
2012
$
5.67

Total net assets
Amount deducted from total net assets:
Minority interests
Net assets applicable to common stockholders¥

Millions of yen
2012
2011
112,016¥
112,623

Thousands of
U.S. dollars
2012$
1,362,891¥

19,556
92,460$19,431
93,192¥

237,936
1,124,955

Number of shares(Thousand)
2012
2011
Number of shares outstanding at the end of year on which net
assets per share is calculated

198,278

201,119

21. SUPPLEMENTARY CASH FLOW INFORMATION
Reconciliation between "Cash on hand and in banks" in the accompanying consolidated balance sheet and"Cash and cash equivalents" in the accompanying consolidated statement of cash flows at March 31, 2012
and 2011 are as follows:

Cash on hand and in banks
Time deposits that have maturities of over three months when
acquired
Cash and cash equivalents¥

Millions of yen
2012
2011
45,898¥43,340Thousands of
U.S. dollars
2012$
558,438¥(4,876)41,022$¥(5,000)38,340(59,326)
499,112

22. COMMITMENTS AND CONTINGENCIESAt March 31, 2012 and 2011, the Company and certain subsidiaries have guaranteed approximately ¥108
million ( $1,314 thousand) and ¥127 million of employee mortgage loans to financial institutions, respectively.
If an employee defaults on his/her loan payments, the Company and/or certain subsidiaries are required toperform under the guarantee.

23. LEASES(a) Finance Lease
Acquisition cost, accumulated depreciation and net carrying amount of leased assets, if they had been
capitalized at March 31, 2012 and 2011 are as follows, which would have been reflected in the consolidatedbalance sheet if finance lease accounting had been applied to the finance leases currently accounted for as
operating leases:
Millions of yen
2012

Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net carrying amount

Furniture
andFixtures
¥
564
489
¥
75

Software
360
344
¥
16
¥

32

2011
Total
924
833
¥
91
¥

Furniture
andFixtures
¥
1,192
839
1
¥
352

Software
491
389
¥
102
¥

Total
1,683
1,228
1
¥
454
¥

Acquisition cost
Accumulated depreciation
Accumulated impairment loss
Net carrying amountThousands of U.S. dollars
2012
Furniture
andFixtures
SoftwareTotal$
6,862 $
4,380 $ 11,242
5,950
4,185
10,135
$
912 $
195 $
1,107

Future minimum payments required under finance leases at March 31, 2012 and 2011 are as follows:

Due within one year
Due after one year¥¥

Millions of yen
2012
2011
94
¥
276
8
207
102
¥
483

Thousands of
U.S. dollars
2012
$
1,144
97
$
1,241

Lease payments, depreciation equivalents and interest expense equivalents for the years ended March 31,
2012 and 2011 are as follows:

Lease payments
Reversal of accumulated impairment loss
Depreciation equivalents
Interest expense equivalents¥

Millions of yen
2012
2011
241
¥
497
0
215
456
9
24

Thousands of
U.S. dollars
2012
$
2,932
2,616
110

Depreciation equivalents and interest expense equivalents are computed by the straight line method andthe interest method, respectively.

(b) Operating Lease
Future minimum lease payments required under noncancellable operating leases as of March 31, 2012 and2011 are as follows:

Within one year
Over one year¥¥

Millions of yen
2012
2011
556
¥
512
2,043
2,577
2,599
¥
3,089

Thousands of
U.S. dollars
2012
$
6,765
24,857$
31,62224.	FINANCIAL INSTRUMENTS
Conditions of Financial instruments(1) Management policy
The Company and subsidiaries (the "Group") primary engages in financial instruments trading business,
which include trading in securities, brokerage for trading in securities, underwriting and distribution of
securities, public offering and secondary distribution of securities and private offering of securities. For
the above mentioned business, the Group uses its own resources and finances funds through bank loans
and call money etc.
The Group makes short-term deposits and loans for margin transaction, and operates securities trading
for the Group own accounts for fund management purposes.
Regarding the trading business, the Group works to do brokerage for trading in securities smoothly andcontribute to a sound market system in an Exchange transaction, and works to make fair prices andtransact smoothly in a Non-Exchange transaction.

33

Regarding the derivative financial instruments, the Group uses interest rate swaps to hedge futurefluctuations of interest rates and does not enter into interest rate swaps for trading or speculative
purposes, and also uses commodity futures and set the position limit on commodity futures.
(2) Financial instruments and risks
The main financial assets of the Group consist of cash on hand and in banks, cash segregated as deposits
for customers and others, trading assets, receivables on margin transactions, receivables on collateralized
securities transactions and investment securities.
The cash in banks are exposed to credit risk of banks. Most of cash segregated as deposits forcustomers and others are cash segregated as deposits for customers, and are segregated from the Groupown assets and trusted to banks in accordance with the Japanese Financial Instruments and Exchange
Law. The trusted funds are secured by the Trust Act.
Trading position is made for meeting customers' various needs and for hedging the position. Such
trading involves market and counterparty risks which possibly effect on the financial position of theGroup. Market risk is the risk arising from future changes in the market values of securities, interest
rates and foreign currency exchange rates, and counterparty risk is the risk arising from default by thecounterparty.
Receivables on margin transactions consist of loans receivable from customers and cash deposits as
collateral for securities borrowed from securities finance companies, and are exposed to credit riskof counterparties. Receivables on collateralized securities transactions consist of cash collateral for
securities borrowed, and are exposed to counterparty risk. Investment securities are exposed to issuer's
credit risk and market risk.
The main financial liabilities of the Group consist of trading liabilities, payables on margin transactions,payables on collateralized securities transactions, deposits received, guarantee deposits received andborrowings.
Payables on margin transactions consist of borrowings from securities finance companies and proceedsfrom securities sold for customers' accounts. Payables on collateralized securities transactions consistof cash collateral for securities loaned. Deposit received is temporary unsettled amount arising fromtransaction with customers. Guarantee deposits received is deposit received for margin transactions
from customers. Part of financial liabilities, such as borrowings, are exposed to liquidity risk that is therisk for the Group not to make a payment on due date. The borrowings with variable interest rate areexposed to interest rate fluctuation risk.
The Group uses derivative financial instruments as part of asset and liability management. For trading
purpose, the Group uses derivatives listed on exchange such as stock index futures and bond futures,
as well as over-the-counter derivatives such as forward foreign exchange transactions. For non-trading
purpose, the Group uses interest rate swaps. Interest rate swaps are used to hedge future cash flow
fluctuation arising from interest rate fluctuations on the borrowings. The difference in amounts to be
paid or received on interest rate swaps is recognized over the life of the agreements as an adjustment
to interest expense, if the agreements meet certain hedging criteria ("exceptional accounting method").
Interest rate swaps are exposed to interest rate fluctuation risk, however, counterparties are limited to
the lender.
(3) Financial instruments risk management
The group maintains appropriate risk management and control measures in order to maintain the Groupfinancial stability and to effectively use the Group business resources.
In Okasan Securities Co., Ltd., our core firm, market risk is controlled principally through position limits,and counterparty risk is controlled principally through credit limits by each financial instrument. Primarily,
trading department checks the position and the gain or loss. Secondarily, risk control department
ascertains the position and the assessed risks reported by the trading department, and supervise theposition.
Proprietary position at every month end is stress tested based on the scenario of 10% decrease in stocks
and 100 basis points increase in interest rates for bonds, and effect of an expected loss on capital adequacy
ratio is reported to Financial Service Agency. The stress test indicates that the expected loss is ¥410
million ( $4,988 thousand) as of March 31, 2012.
In order to reduce the risks, receivables on margin transactions are controlled by daily credit management34

through setup of inception criteria for margin transactions and limits for open interest, deposits reception
when market fluctuates in accordance with customer management rules. Purchases and sales ofinvestment securities and stock market fluctuations are controlled in accordance with investment securities
management rules. Liquidity risk is controlled based on fund management plan in accordance with liquidity
risk management rules. The Group also makes contingency plan to mitigate liquidity crisis.
Securities subsidiaries other than Okasan Securities Co., Ltd. also maintain appropriate risk controls.
(4) Supplemental explanation regarding fair value of financial instruments
The contract amount of the derivative transactions does not represent the risk of the derivativetransactions.
Fair value of financial instruments
The carrying amounts on the consolidated balance sheet, fair value, and differences as of March 31, 2012 and2011 are as follows.
Financial instruments, of which it is extremely difficult to measure the fair value, are not included. (Please see"(2) Financial instruments of which the fair value is extremely difficult to measure".)Millions of yen
2012
Carrying
value

2011

Fair value

Differences¥¥

Carrying
value

Fair value

Differences¥¥

Assets:Cash on hand and in banks¥

Cash segregated as deposits forcustomers and others

45,89845,898-¥ 43,340

43,340-42,75042,750-48,05348,053-

185,638

185,638-

182,509

182,509-

Trading assets, short-term
investments and investment securities
Trading securities
Available-for-sale securities

17,49017,490-17,743

17,743-

Receivables on margin transactions

33,53333,533-36,24736,247-

Receivables on collateralized securities
transactions

186,087

186,087-

167,522

167,522

-

3,475

3,475

-

3,423

3,423

-

¥

514,871¥ 514,871¥-¥ 498,837¥

498,837¥-¥

152,251¥ 152,251¥-¥ 124,371¥

124,371¥-

Short-term guarantee deposits
Total
Liabilities:
Trading liabilities
Trading securities
Payables arising from unsettled trades

4,058

4,058

-

28,47628,476-

Payables on margin transactions

16,172

16,172-

19,423

19,423-

Payables on collateralized securities
transactions

61,36761,367-29,02429,024-

Deposits received

18,33818,338-20,187

20,187-

Guarantee deposits received

22,99622,996-27,38827,388-

Short-term borrowings

136,168

136,19426

146,283

146,287

4Long-term borrowings

13,47813,640162

15,343

15,550207¥ 425,016¥

188¥ 410,495¥

410,706

¥

211

¥

¥

-

¥

¥

(56)

¥

-

Total

¥

424,828

Derivative transactions

¥

13

13

35

(56)

Thousands of U.S. dollars
2012
Carrying
value

Fair value

Differences

Assets:Cash on hand and in banks$

Cash segregated as deposits forcustomers and others

558,438$

558,438$-

520,136

520,136

Trading securities

2,258,645

2,258,645-

Available-for-sale securities

212,800

212,800-

Receivables on margin transactions

407,994

407,994-

Receivables on collateralized securities
transactions

2,264,107

2,264,107-

42,28042,280-$ 6,264,400$ 6,264,400$-$ 1,852,427$ 1,852,427$-

49,37349,373-

Payables on margin transactions

196,764

196,764-

Payables on collateralized securities
transactions

746,648746,648-

Trading assets, short-term investments
and investment securities

Short-term guarantee deposits
Total
Liabilities:
Trading liabilities
Trading securities
Payables arising from unsettled trades

Deposits received

223,117

223,117-

Guarantee deposits received

279,791

279,791-

Short-term borrowings

1,656,747

1,657,063

316

Long-term borrowings

163,986

165,957

1,971

Total

$ 5,168,853$ 5,171,140

$

2,287

Derivative transactions

$

$

$

-

158

158

* Derivative receivables and payables are on net basis. Items that are net payables are shown in parenthesis.

(1) Fair value measurement of financial instruments
Assets:Cash on hand and in banks, Cash segregated as deposits for customers and others, Receivables on margintransactions, Receivables on collateralized securities transactions, Short-term guarantee deposits and Shortterm loans
The carrying amount approximates fair value because of the short maturity of these instruments.
Trading assets, short-term investments and investment securities
The carrying amount approximates fair value because the carrying amount of equity securities, debt
securities and beneficiary certificates is calculated by quoted market price. Please see note 4.
TRADINGASSETS AND LIABILITIES and see note 7. SECURITIES FOR NON-TRADING PURPOSES for
information by category.

36

Liabilities:
Trading liabilities
The carrying amount approximates fair value because the carrying amount of equity securities, debt
securities and beneficiary certificates is calculated by quoted market price. Please see note 4. TRADINGASSETS AND LIABILITIES for information by category.
Payables arising from unsettled trades, Payables on margin transactions, Payables on collateralized securities
transactions, Deposits received, Guarantee deposits received and Short-term borrowings
The carrying amount approximates fair value because of the short maturity of these instruments. Fairvalue of current installments of long-term borrowings included in short-term borrowings is calculated as
below. (See Long-term borrowings.)
Long-term borrowings
The carrying amount of long-term borrowings with variable interest rate approximates fair value
because the fair value is reflected the fluctuation of interest market in a short period and credit statusof the Company does not change so much from when the Company borrowed. Fair value of long-termborrowings with fixed interest rate is based on the present value of future cash flows of interest andprincipal payments discounted using the current borrowing rate for similar borrowings of a comparable
maturity.
Fair value of certain long-term borrowings with interest rate swaps for which exceptional accounting
method applied are based on the present value of future cash flows of interest and principal payments
discounted using the current borrowing rate for similar borrowings of a comparable maturity.
Derivative Transactions:
Please see note 25. DERIVATIVES.
(2) Financial instruments of which the fair value is extremely difficult to measure
Thousands of
U.S. dollars

Millions of yen
2012
Unlisted equity securities¥

Investments in limited partnership and similar partnership

4,813

2011
¥

171

Total

¥

4,984

2012

4,725

$

58,559$60,640

293
¥

5,018

2,081

(3) ① Projected future redemption of monetary claim and securities with maturities at March 31, 2012
Millions of yen
Due after
one yearthrough fiveyears

Due within
one year
Cash on hand and in banks¥

Cash segregated as deposits for customers
and others

45,898¥-Due after
five years
through ten
years
¥

-

Due after
ten years¥-

42,750

-

-

-

3,300

300

-

-

Trading assets, short-term investments andinvestment securities:
Available-for-sale securities withmaturities:
Debt securities:
Government bonds

268

398

61

-

Receivables on margin transactions

Other

33,533---

Receivables on collateralized securities
transactions

186,087

-

-

-

3,476

-

-

-

Short-term guarantee deposits¥

315,312

37

¥

698

¥

61

¥

-

Thousands of U.S. dollars
Due after
one yearthrough fiveyears

Due within
one year
Cash on hand and in banks$

558,438

Cash segregated as deposits forcustomers and others$

Due after
five years
through ten
years

-

520,136-

40,151
3,260

Receivables on margin transactions
Receivables on collateralized securities
transactions$

Due after
ten years

-

$

-

-

-

3,650

-

-

4,843

742

-

407,994---

2,264,108---

42,292---

Trading assets, short-term investments
and investment securities:
Available-for-sale securities withmaturities:
Debt securities:
Government bonds
Other

Short-term guarantee deposits$

3,836,379

$

8,493

$

742

¥

-

② Projected future redemption of monetary claim and securities with maturities at March 31, 2011
Millions of yen
Due after
one yearthrough fiveyears

Due within
one year
Cash on hand and in banks¥

Cash segregated as deposits forcustomers and others

43,340¥-Due after
five years
through ten
years
¥

-

Due after
ten years¥-

48,053

-

-

-

3,300

300

-

-

Trading assets, short-term investments
and investment securities:
Available-for-sale securities withmaturities:
Debt securities:
Government bonds

-

568

3

64

Receivables on margin transactions

Other

36,247---

Receivables on collateralized securities
transactions

167,522

-

-

-

3,423

-

-

-

Short-term guarantee deposits¥

301,885(4) The annual maturities of the long-term debt
Please see note 9. BORROWINGS.

38

¥

868

¥

3

¥

64

25. DERIVATIVES
Derivatives utilized for trading purposes
The contract or notional amounts and fair value of derivative financial instruments for trading purposes
held at March 31, 2012 and 2011 are summarized as follows:
Millions of yen
2012
Contract
or notionalamounts Fair value
Stock index futures:
Written
Purchased
Stock index options:
Written
Purchased
Bond futures:
Written
Purchased
Forward foreign exchange:
Written:South Africa Rand
Australian dollar
U.S. dollar
New Zealand dollar
Other

¥

Valuation
gain (loss)

3,163 ¥
3,166

(4) ¥
(11)

(4)
(11)

3
1

2
2

8,654

512
379
141
61
218

2011
Contract
or notionalamounts Fair value¥

Valuation
gain (loss)

2,933 ¥
3,175

(78) ¥
30

(78)
30

1
1

22

2

(20)

8

8

1,674
140

(1)
-

(1)
-

11
4
1
1
2

11
4
1
1
2

120
427
124
126
307

(1)
(3)
(1)
(2)

(1)
(3)
(1)
(2)

Thousands of U.S. dollars
2012
Contract
or notional
Valuationamounts Fair value gain (loss)
Stock index futures:
Written
Purchased
Stock index options:
Written
Purchased
Bond futures:
Purchased
Forward foreign exchange:
Written:South Africa Rand
Australian dollar
U.S. dollar
New Zealand dollar
Other

$

38,484 $38,521

(49)
(134)

$

(49)
(134)

36
12

24
24

12
12

105,293

97

97

6,229
4,611
1,716
742
2,652

134
49
12
12
24

134
49
12
12
24

The fair value of stock index futures, stock index options, bond futures and interest futures exchange
is computed using prices on the market. The fair value of forward foreign exchange is based on the
difference between the present value of future cash flows of receipt amount and the present value of future
cash flows of payment amount. At March 31, 2012 and 2011, gain or loss on deemed settlement is disclosed
in the "Fair value" column of stock index futures, bond futures, interest futures and forward foreignexchange above.

39

Derivatives utilized for non-trading purposes
The contract or notional amounts and fair value of interest rate swap contracts for non-trading purposes
held at March 31, 2011 were summarized as follows:
Millions of yen
Contract
or notional
Valuationamounts Fair value
gain (loss)
Interest rate swaps:
Variable rate received for
fixed rate

¥

54 ¥

(1) ¥

(1)

The fair value of interest rate swaps is estimated based on quotes from counterparties. Gain or loss on
deemed settlement is disclosed in the "Fair value" column above.
Derivative transactions to which hedge accounting are applied at March 31, 2012 and 2011 are summarized
as follows:
Contract or notional amounts
Thousands of
U.S. dollars

Millions of yen
Nature of transaction
Interest rate swaps:
Variable rate received for
fixed rate

2012

Hedged items
Long-term
borrowings

¥

2011

7,500 ¥

2012

8,050

$

91,252*1	Hedge accounting method is the exceptional accounting method which is the difference in amounts
to be paid or received on interest rate swaps being recognized over the life of the agreements as an
adjustment to interest expense.
*2	Fair value of derivative financial instrument is included in fair value of the long-term borrowings ashedged items for certain long-term borrowings for which interest rate swap contracts are used to hedge
the interest rate fluctuations.
26. INVESTMENT AND RENTAL PROPERTY"Accounting Standard for Disclosures about Fair Value of Investment and Rental Property" (ASBJ
Statement No. 20, November 28, 2008) and its "Guidance on Accounting Standard for Disclosures about Fair
Value of Investment and Rental Property" (ASBJ Guidance No. 23, November 28, 2008) require to disclose
fair value of investment and rental property in the notes to financial statements.
The Company and certain consolidated subsidiaries own their rental office buildings, land etc (hereafter"rental property"). Income from the rental property is ¥171 million ( $2,081 thousand) and ¥161 million forthe years ended March 31, 2012 and 2011, respectively.
The amounts recognized in the consolidated balance sheet and fair values related to the rental property
are as follows:
Thousands of
U.S. dollars
2012

Millions of yen
2012

Consolidated balance sheet amount:
Balance at beginning of the year
Increase/(decrease)
Balance at end of the year¥

Fair value

2011
¥

¥

5,953
(94)
5,859

$

¥

5,972
(19)
5,953

$

72,430(1,144)71,286

¥

5,422

¥

5,845

$

65,969The above fair value is based on real-estate appraisals, and is estimated by the Company.

40

27. BALANCES AND TRANSACTIONS WITH RELATED PARTY
The Company' officer and the close relatives have a majority equity ownership in Santo Co., Ltd. at March
31, 2012 and 2011.
Transactions between the Company and Santo Co., Ltd. for the years ended March 31, 2012 and 2011 aresummarized as follows:
Thousands of
U.S. dollars
2012

Millions of yen
2012
2011
Transactions:Purchases of affiliates shares

¥

166

¥

144

$

2,020

Transactions between the consolidated subsidiary of the Company and Santo Co., Ltd. for the years
ended March 31, 2012 and 2011 are summarized as follows:
Thousands of
U.S. dollars
2012

Millions of yen
2012
2011
Transactions:
Loan of securities

¥

558

¥

646

$

6,789

28. SEGMENT INFORMATION"The Accounting Standard for Disclosures about Segments of an Enterprise and Related Information"(ASBJ Statement No.17, March 27, 2009) and "the Guidance on Accounting Standard for Disclosures about
Segments of an Enterprise and Related Information" (ASBJ Guidance No.20, March 21, 2008) adopt the
management approach. Disclosures about segments of an enterprise and related information should provide
proper information on the nature of various business activities in which it engages and the economic
environments in which it operates.
The reported segments of the Company are the business units for which the Company is able to obtainrespective financial information separately in order for the Board of Directors to conduct periodic
investigation to determine distribution of management resources and evaluate their business results.
"Securities business", "Asset management business" and "Support business" are the Company's reported
segments.
"Securities business" renders trading and brokerage for trading in securities, underwriting and distributionof securities, public offering and secondary distribution of securities and private offering of securities.
"Asset management business" renders investment management and investment advisory. "Support
business" renders information processing services, administrative support services, custodianship andtemping services, etc.
Segment operating revenues, income, assets, liabilities and others are calculated by accounting methods
similar to those employed to prepare the accompanying consolidated financial statements.
Segment income is calculated based on operating income in the consolidated statement of income.
Intersegment revenues and transfer are based on arms-length transactions.
Operating revenues, income, assets, liabilities and others by reported segments
The reported segment information for the Company and its consolidated subsidiaries for the years ended
March 31, 2012 and 2011 are summarized as follows:41

Millions of yen
2012

Securities

Reported segments
Asset
Supportmanagement

Total

Adjustments

Consolidated

Operating revenues:
Revenues from third
parties¥

50,461

¥

9,441

Total

¥

55,333

¥

9,441

¥

Segment income

¥

873

¥

412

Segment assets¥

526,059¥

Segment liabilities¥

450,840

1,281Intersegment revenues¥

61,057

9,745

¥

¥

1,063

12,088

¥

¥

1,056

¥

44

4,872

¥

¥

8

74,519

¥

¥

2,348

24,901¥¥

14,944

¥

¥

2,508

¥

-

1,155
8,590

¥

61,065(13,454)¥

61,065

¥

804

¥

3,152

563,048¥(6,659)¥556,389

466,840¥(22,467)¥

444,373

3,833

¥

106

¥

3,939

13,462(13,462)-

Others:Depreciation¥

Financial income

2,450

-

-

2,450

(462)

1,988

Financial expenses

1,967

-

-

1,967

(369)

1,598

Increase in property
and equipment andintangible assets

600

87

1,698

2,385

88

2,473

Millions of yen
2011
Reported segments
Asset
SupportTotal
management

Adjustments

Consolidated

¥

¥

¥

Securities
Operating revenues:
Revenues from third
partiesIntersegment revenues
Total

¥

52,281
5,443
57,724

Segment income¥

Segment assets
Segment liabilities
Others:Depreciation
Amortization of goodwill
Financial income
Financial expenses
Increase in property
and equipment andintangible assets

¥

¥

9,354
9,354

850

¥

¥

511,174

¥

¥

¥

1,311
9,039
10,350655¥¥

11,833434,727

¥

1,165
2,840
2,149

¥

1,213

¥

62,946
14,482
77,428

1,251

¥

¥

25,822

1,063

¥

40
-

¥

23

42

¥

¥

18
(14,482)(14,464)¥

62,96462,964

2,756

¥

653

¥

3,409

¥

548,829¥(6,292)¥542,537

16,646¥452,436¥(22,522)¥429,914

2,514
-

¥

3,719
2,840
2,149

¥

109
47
(560)
(460)

¥

3,828
47
2,280
1,689

1,525

¥

2,761

178

2,939

Thousands of U.S. dollars
2012
Reported segments
Asset
Adjustments
SupportTotal
management

Securities

Consolidated

Operating revenues:
Revenues from third
partiesIntersegment revenues
Total

$

613,956
59,277673,233$

114,868
114,868$

14,053
104,514
118,567$

742,877
163,791
906,668$

97(163,791)(163,694)$

742,974
742,974

Segment income$

10,622

$

5,013

$

12,933$28,568

$

9,782

$

38,350

Segment assets$ 6,400,523$

147,074$

302,969$ 6,850,566$(81,020)$ 6,769,546

Segment liabilities$ 5,485,339$

12,848$

181,823$ 5,680,010$(273,355)$ 5,406,655

$

$

535
-

$

30,515
-

$

$

1,290
(5,621)(4,489)Others:Depreciation
Financial income
Financial expenses
Increase in property
and equipment andintangible assets

15,58629,80923,932
7,300

1,059

20,65946,63629,80923,93229,0181,071$

47,92624,18819,44330,0891. (1) Components of "Adjustments in segment income" are as follows:

Elimination of intersegment transactions
Unallocated company-wide expenses¥¥

Millions of yen
2012
2011
3,002 ¥
2,771
(2,198)(2,118)804 ¥653

Thousands of
U.S. dollars
2012$
36,525(26,743)$
9,782

Company-wide expenses are holding company's expenses.
(2) Components of "Adjustments in segment assets" are as follows:

Elimination of intersegment balances
Unallocated company-wide assets¥¥

Millions of yen
2012
2011
(38,633)¥(38,900)
31,97432,608(6,659)¥(6,292)Thousands of
U.S. dollars
2012$(470,045)
389,025$(81,020)

Company-wide assets are holding company's assets.
(3) Components of "Adjustments in segment liabilities" are as follows:
Thousands of
U.S. dollars

Millions of yen
2012
Elimination of intersegment balances¥

Unallocated company-wide liabilities(38,174)

2011¥

15,707¥(22,467)(38,118)$(464,461)$(273,355)

15,596¥(22,522)Company-wide liabilities are holding company's liabilities.
2. Segment income is adjusted with operating income in the consolidated statement of income.

43

2012
191,106

Related information
1.	Information by products and services
Disclosures are omitted because operating revenues from third parties of a single product and service
are over 90% of operating revenues in the consolidated statement of income.
2.

Geographical information(1)	Operating revenues
Disclosures are omitted because operating revenues from customers in Japan are over 90% of
operating revenues in the consolidated statement of income.
(2)	Property and equipment
Disclosures are omitted because property and equipment located in Japan are over 90% of property
and equipment in the consolidated balance sheet.

3.	Information by major customers
Disclosures are omitted because no particular third party whose operating revenues are over 10% of
operating revenues in the consolidated statement of income exists.
Information of impairment loss on fixed assets by reported segments
Not applicable
Negative goodwill incurred by reported segments
Negative goodwill of ¥279 million ( $3,395 thousand) and ¥166 million which are not allocated to eachreported segments are reported for the years ended March 31, 2012 and 2011, respectively. The negative
goodwill occurred when the Company acquired additional shares of its subsidiary.
29. Subsequent event
The acquisition of 3,056 thousand shares (82.1% of issued shares) of Shinwa Securities Co., Ltd. ("Shinwa
Securities") was approved at the Board of Directors held on June 14, 2012 of Marufuku Securities Co., Ltd.
("Marufuku Securities") which is the subsidiary of the Company. And Marufuku Securities concluded theshare sales contract on June 15, 2012.
1. Purpose of shares acquisition
Marufuku Securities has branch offices around Niigata prefecture mainly in Nagaoka City. Shinwa
Securities does business and has a firm establishment in Niigata City. Securities companies have become
more important to meet individual investors' needs for investments. Marufuku Securities decided toacquire the shares of Shinwa Securities to establish a system to provide high level investment services
by merging the two companies which do business in Niigata prefecture together.
2. Marufuku Securities acquired the shares of Shinwa Securities from Mizuho Securities Co., Ltd.
3. Outline of Shinwa securities Co., Ltd.
Representative director: Narihide Kurata
Location: 6-1178-1 Kami-okawamae-dori Chuo-ku Niigata-city Niigata prefecture
Establishment: March 31, 1944
Common stock: ¥780 million ( $9,490 thousand)Business: Financial instruments and exchange business
4. Date of acquisition
July 2, 2012

44

45

REFERENCE DATA

46

Okasan Securities Co., Ltd.
Balance Sheet ─ March 31, 2012

Thousands of
U.S. dollars

Millions of yen
2012

2011

2012

ASSETS
Current assets:
Cash on hand and in banks¥

14,159¥12,191$

172,272

Cash segregated as deposits for customers and others

16,062

15,362

195,425

Trading assets

185,657

182,458

2,258,876

Receivables on margin transactions

31,10930,800378,501

Receivables on collateralized securities transactions

186,087

167,5222,264,108

Short-term guarantee deposits

2,973

2,564

36,172

Deferred income taxes

642

578

7,811

Other current assets

2,494

2,580

30,344

Allowance for doubtful accounts

(3)

(5)

(37)

Total current assets

439,180

414,050

5,343,472

2,149

2,264

26,147

417

364

5,074

Investment securities

658

1,064

8,006

Long-term guarantee deposits

3,539

3,545

43,059Deferred income taxes

1,678

1,764

20,416

Other

1,479

1,519

17,995

Allowance for doubtful accounts(1,071)(1,073)(13,031)

6,283

6,819

76,445

Property and equipment, net of accumulated depreciation
Intangible assets, net
Investments and other assets:

Total investments and other assets
TOTAL

¥

47

448,029¥

423,497$

5,451,138

Okasan Securities Co., Ltd.
Balance Sheet ─ (Continued) ─ March 31, 2012
Thousands of
U.S. dollar

Millions of yen
2012

2011

2012

LIABILITIES AND NET ASSETS
Current liabilities:
Trading liabilities¥

152,258¥

124,404$

1,852,512

Payables arising from unsettled trades

4,803

28,58258,438

Payables on margin transactions

15,146

16,886

184,280

Payables on collateralized securities transactions

61,36729,024

746,648

Deposits received

11,82912,445

143,923

Guarantee deposits received
Short-term borrowings

6,870

8,666

83,587

123,465

130,415

1,502,190

Income tax payables

319

194

3,881

Other current liabilities

4,928

4,525

59,959380,985

355,141

4,635,418

Long-term borrowings

7,900

8,900

96,119Retirement and severance benefits

4,845

4,577

58,949Total current liabilities
Non-current liabilities:

Other non-current liabilities

1,139

1,234

13,858

Total non-current liabilities

13,884

14,711

168,926

Financial instruments transactions reserve

809

768

9,843

395,678

370,620

4,814,187

Total liabilities
Net assets
Shareholder's equity:
Common stock
Authorized − 240,000 shares
Issued − 100,000 shares in 2012 and 2011

5,000

5,000

60,835

Capital surplus

29,20029,200355,274Retained earnings

18,15918,621

220,939

52,35952,821

637,048

(8)

56

(97)

52,351

52,877

636,951

Total shareholder's equity
Accumulated other comprehensive income (loss):
Unrealized gain (loss) on available-for-sale securities
Total net assets
TOTAL

¥

48

448,029¥

423,497$

5,451,138

Okasan Securities Co., Ltd.
Statement of Income ─ Year ended March 31, 2012
Thousands of
U.S. dollar

Millions of yen
2012

2011

2012

Operating revenues:
Commissions¥

Net gain on trading

29,234¥

16,784

Interest and dividend income

29,396$

17,786355,688
204,210

1,537

1,832

18,70047,55549,014

578,598

Interest expense

1,440

1,484

17,520Net operating revenues

46,11547,530561,078

Selling, general and administrative expenses

44,74946,274544,458

Operating income

1,366

1,256

16,620

Other income (expenses):Gain on sale of investment securities

102

-

1,241

Provision for financial instruments transactions reserve

(41)

(188)

(499)

Cumulative effect on prior years of adoption of new accounting
standard for asset retirement obligations
Other, net

Income before income taxes

-

(411)

-

210

328

2,555

271

(271)

3,297

1,637

985

19,917

1,034

721

12,580

65

114

791

1,099

835

13,371

Income taxes:
Current
Deferred

Net income

¥

49

538

¥

150

$

6,546

CORPORATE DATABOARD OF DIRECTORS(At March, 2012)(At March, 2012)

Company Name
OKASAN SECURITIES GROUP INC.

ChairmanSeiichi Kato

Date of Establishment
August 25, 1944

President
Tetsuo Kato

Head Office
1-17-6 Nihonbashi, Chuo-ku,
Tokyo 103-8268, Japan

Senior Managing Director
Hiroyuki Shinshiba
Kazuhiko Nonaka

Muromachi Head Office2-2-1 Nihonbashi Muromachi, Chuo-ku,
Tokyo 103-0022, Japan

Director
Kenichi Tanaka
Masanori Kanai
Hiroyuki Shindo

Phone Number+81-3-3272-2222

Statutory Auditors
Tetsumi Iwaki
Koichi Saku
Hirosuke Minami
Tokio Hiraragi
Yukihiro Asano
Takao Saga

Paid-in Capital
18,590 Million Yen
Subsidiaries
10 companies
Listed Stock Exchanges
Tokyo Stock Exchange
Osaka Securities Exchange
Nagoya Stock Exchange

ORGANIZATION CHART(At March, 2012)50