TSE Code 8511
May 31, 2023
To Shareholders
Director Representative Executive Officer & President
Shigeki Kushida
JAPAN SECURITIES FINANCE CO., LTD.
1-2-10, Nihonbashi-Kayabacho, Chuo-ku, Tokyo, JapanNOTICE OF CONVOCATION OF
THE 113th ANNUAL GENERAL MEETING OF SHAREHOLDERS
Notice is hereby given that the 113th Annual General Meeting of Shareholders (the“Meeting”) of Japan Securities Finance Co., Ltd. (the “Company” or “JSF”) will be held as
described below.
You may exercise your voting rights using either of the following methods, and are kindly
requested to exercise your voting rights after reviewing the Reference Materials concerning
the Meeting as described below.
[When exercising your voting rights in writing (voting right exercise form)]
Please indicate your vote for or against the proposals on the enclosed Voting Rights
Exercise Form and send it back so that it arrives by 5:20 p.m. (JST) on Wednesday, June21, 2023.
[When exercising your voting rights via the Internet, etc.]
When exercising your voting rights via the Internet, etc., please carefully read the “Notes
on the Execution of Votes" before exercising your voting rights.
Yours very truly,

1Details
1 Date and Time■

10:00 a.m. on Thursday, 22 June, 2023

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

3 Agenda for the Report:■
Meeting

Matters for
Resolution:

1. The 113th fiscal year (from April 1, 2022 to March 31, 2023)
Business Report, Consolidated Financial Statements andReport of audits of the consolidated financial statements by
the Independent Auditor and Audit Committee.
2. The 113th fiscal year (from April 1, 2022 to March 31, 2023)
Financial Statements<Proposal by the Company>
Election of Seven (7) Directors
Proposal 1<Proposal by Shareholders>

4 Notes on the■
Execution of
Votes

Proposal 2

Amendment to the Articles of Incorporation
to abolish the position of Chairperson of the
Executive Officers

Proposal 3

Amendment to the Articles of Incorporation
concerning disclosure of individual
remuneration for the Representative
Executive Officer & President

Proposal 4

Amendment to the Articles of Incorporation
concerning the prohibition of reemployment,
etc. of persons who have served as
President

Proposal 5

Amendment to the Articles of Incorporation
concerning disclosure of remuneration for
officers who have served as President after
their retirement from office

Proposal 6

Amendment to the Articles of Incorporation
concerning disclosure of material proposed
actions taken by major shareholders

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

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

2Notes on the Execution of Votes.
1. With regard to the exercise of voting rights via the Internet.
(1) Shareholders exercising their voting rights via the Internet can only do so via the website
designated by the Company (https://www.e-sokai.jp). However, please note that thevoting service website is not available from a mobile which the Internet can be connected.
(2) If you are exercising your voting rights via the Internet, please enter your “voting code”
and “password” indicated on the proxy voting form and follow the instructions on thescreen to register whether you approve or disapprove of each proposal, and are kindly
requested to exercise your voting rights on or before 5:20 p.m. (Japan standard time) on
Wednesday, June 21, 2023.
(3) If you exercise your voting rights via the Internet multiple times, the vote cast last shallprevail.

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

3

REFERENCE MATERIALS CONCERNING
THE GENERAL MEETING OF SHAREHOLDERS
Proposal by the Company
Proposal 1 Election of Seven (7) Directors
As the term of office of all directors will expire at the conclusion of this General Meeting, theCompany proposes the election of seven(7) directors (including five(5) outside directors) in accordancewith the decision of the Nomination Committee.
The candidates are follows.
No.

Name

Career Summary, Position and Duty

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

Naotaka Obata(Oct. 15, 1944）
Reappointment

OutsideIndependent

1

Jun. 2010
Jun. 2012
Apr. 2013
Jun. 2018

Jun. 2019

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

Number of Company Shares owned―
Term of Office
4years (At the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
13/13 (100％)
Nomination Committee
8/8 (100％)
Remuneration Committee
7/7 (100％)(Reasons for selecting the candidate and expected roles)
He has extensive experience in corporate management in the financial industry. Through his overseas
business experience, he also has extensive knowledge and insight on international businessdevelopment, and therefore, the Company has judged that he can be expected to play a sufficient role in
the effective supervision of the Company's management and in decision-making on medium- and longterm management policies, etc., from an independent and objective standpoint as an outside director, andhas therefore nominated him as a candidate for director.
(Independence)
He is an independent director as provided for by Tokyo Stock Exchange, Inc. If this proposal is approved,
the Company plans for his appointment as an independent director to continue. There are no transactions
between the Company and Mitsubishi HC Capital Inc., for which he served as President and CEO until
June 2010.

4

No.

Name

Career Summary, Position and Duty

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

Shoko Sugino

Mar. 2007（Aug. 7, 1945）
Reappointment

OutsideIndependent2

Jun. 2018
Jun. 2019

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

Number of Company Shares owned
1,800
Term of Office
4years (At the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
13/13 (100％)
Nomination Committee
8/8 (100％)
Audit Committee
13/13 (100%)
Remuneration Committee
7/7 (100％)

Audit & Supervisory Board Member of Takeei Corporation
Outside Director of Janome Corporation(Reasons for selecting the candidate and expected roles)
As an attorney at law, she has extensive experience and knowledge in legal and compliance matters, aswell as in internal control, sustainability, and corporate governance. The Company has judged that she canbe expected to play a sufficient role in the effective supervision of the Company's management and indecision-making on medium- and long-term management policies, etc., from an independent and objective
standpoint as an outside director, and has therefore nominated her as a candidate for director. Although
she has not been directly involved in the management of a corporation, except as outside director or outside
corporate auditor, the Company believes that she is well qualified to act as an outside director because of
the reasons stated above.
(Independence)
She is an independent director as provided for by Tokyo Stock Exchange, Inc. If this proposal is approved,
the Company plans for her appointment as an independent director to continue.
No.

Name

Career Summary, Position and Duty

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

Oct. 2003

Kensuke
Futagoishi

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

3

OutsideIndependent

Jun. 2010
Jun. 2018
Jun. 2022

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

Number of Company Shares owned
700
Term of Office
1year (At the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
10/10 (100％)
Nomination Committee
8/8 (100％)
Remuneration Committee
6/6 (100％)(Reasons for selecting the candidate and expected roles)
He has extensive experience in the management of financial institutions with unique and leading-edgebusiness models, as well as a wealth of knowledge and extensive insight on internal control and risk
management. The Company has judged that he can be expected to play a sufficient role in the effective
supervision of the Company's management and in decision-making on medium- and long-term
management policies, etc., from an independent and objective standpoint as an outside director, and has
therefore nominated him as a candidate for director.
(Independence)
He is an independent director as provided for by Tokyo Stock Exchange, Inc. If this proposal is approved,
the Company plans for his appointment as an independent director to continue. There are no transactions
between the Company and Seven Bank, Ltd., for which he served as President and Representative Director
until June 2018.

5

No.

Name

Career Summary, Position and Duty

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

Takayoshi
Yamakawa

Jan. 2021
Apr. 2021（Oct. 2, 1965）

Jun. 2021

Reappointment

4

OutsideIndependent

Jun. 2022

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

Number of Company Shares owned
1,100
Term of Office
1year (At the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
10/10 (100％）
Audit Committee
11/11 (100%)
Remuneration Committee
6/6 (100％)(Significant concurrent positions)Representative Partner, Business Producer LLC
Outside Director, Akatsuki Securities, Inc.
Outside Director, FP Corporation(Reasons for selecting the candidate and expected roles)
He has extensive knowledge and insight into trends in technological innovation related to DX, etc., as well
as extensive experience in corporate management in the industrial sector. The Company has judged that
he can be expected to play a sufficient role in the effective supervision of the Company's management andin decision-making on medium- and long-term management policies, etc., from an independent andobjective standpoint as an outside director, and has therefore nominated him as a candidate for director.
(Independence)
He is an independent director as provided for by Tokyo Stock Exchange, Inc. If this proposal is approved,
the Company plans for his appointment as an independent director to continue. There are also notransactions between the Company and Business Producer LLC, of which he is Representative Partner,and Dream Incubator Inc., of which he was the Representative Director & CEO until June 2020.

6

No.

Name

Career Summary, Position and Duty

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

Setsuko Egami（Jul. 16, 1950）
New

OutsideIndependent

5

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

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

Number of Company Shares owned―
Term of Office―Attendance rate―

(Significant concurrent positions)
Professor Emeritus, Musashi University
Outside Director of Mitsubishi Estate Co., Ltd.
Outside Director of Resona Holdings, Inc.

(Reasons for selecting the candidate and expected roles)
She has extensive knowledge and broad insight on human resource development, risk management, andcorporate management. The Company has judged that she can be expected to play a sufficient role in theeffective supervision of the Company's management and in decision-making on medium- and long-term
management policies, etc., from an independent and objective standpoint as an outside director, and has
therefore nominated her as a candidate for director.
(Independence)
If this proposal is approved, the Company plans to designate her as new independent director as provided
for by the Tokyo Stock Exchange, Inc.
No.

Name

Career Summary, Position and Duty

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

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

Shigeki Kushida

May 2019
Jun. 2019（Jun. 8, 1958）

6

Reappointment

Jun. 2022

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

Number of Company Shares owned
15,800Term of Office
4years (At the conclusion of thisgeneral meeting)Attendance rate
Board of Directors
13/13 (100％）
Nomination Committee
8/8 (100％)
Remuneration Committee
7/7 (100％）(Significant concurrent positions)
Director of JSF Trust and Banking Co., Ltd.
Outside Director of Denso Corp.

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

7

No.

Name

Career Summary, Position and Duty

（Date of birth）(Significant concurrent positions)Apr. 1978
Jun. 2002
Jun. 2005
Jun. 2006
Feb. 2008
Jun. 2009

7

Hiroshi Asakura（Nov. 1, 1955）

Jun. 2013
Jun. 2016
Jun. 2021

Reappointment

Joined Japan Securities Finance Co., Ltd.
General Manager of Planning Dept.
General Manager of Margin Loan Dept.
Corporate Officer & General Manager of Margin
Loan Dept.
Corporate Officer & General Manager of Loan
Dept.
Managing Director of Japan Securities FinanceCo., Ltd.
Senior Managing Director(retired in Jun. 2016)
President of Nihon Building Co., Ltd. (retired inJun. 2021)
Director of Japan Securities Finance Co., Ltd.
(current position)

Number of Company Shares owned
50,300Term of Office
2years (At the conclusion of thisgeneral meeting)
取締役会等の出席状況
Board of Directors
13/13 (100％）
Audit Committee
13/13 (100%)(Reasons for selecting as a candidate)
He has served as a General Manager and Director of the Company and is familiar with all aspects of theCompany's business activities. Moreover, he has extensive experience and knowledge in the fields offinance and securities, as well as knowledge of finance. The Company has judged that he can be expected
to play a sufficient role in the effective supervision of the Company's management and in decision-making
on the Company's medium- to long-term management policies, etc., and has therefore nominated him as a
candidate for the position of director.

Reappointment

Candidate for
Reappointment
Director

New

Candidate for
New Director

OutsideCandidate for
Outside Director

Independent

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

8

[Reference 1 ] Skills list of Director candidates (Skills Matrix)

Name

Corporate
management

FinanceSecurities
EconomicsInternationalexperience

Naotaka Obata

○

○

○

Judicial
affairs
ComplianceInternal
controls
Riskmanageme
nt

ESG

○

○

○

○

○

○

○

○

○

○

○

○

○

○

Financial
Accounting○

Shoko Sugino
Kensuke Futagoishi○○

Takayoshi Yamakawa○○

Setsuko Egami○

Shigeki Kushida

○

○
○

○

○

○

Hiroshi Asakura○[Reference 2 ] Planned appointments of director candidates to Chairperson of the Board of Directors,
Nomination, Audit, and Remuneration committees
Seven (7) candidates for directors (including two (2) females) will assume the following positions after theirelection at the Shareholders' Meeting.
Name

Naotaka Obata

Position

Nomination
Committee

Audit
Committee

Chairpersonof the Board Chairpersonof Directors

Shoko Sugino

MemberKensuke Futagoishi

MemberTakayoshi Yamakawa

MemberRemuneration
Committee

Chairperson
Chairperson

MemberMemberReappointment
Outside Director
Reappointment
Outside Director
Reappointment
Outside Director
Reappointment

MemberOutside Director
MemberSetsuko Egami

Remarks

New appointment
Outside Director
Reappointment

Shigeki Kushida

MemberMemberRepresentative
Executive Officer &President

Hiroshi Asakura

Member9

Reappointment
Non-executive director

[Reference 3 ]Criteria for Independence of Outside Directors
Anyone who meets any of the following criteria, in addition to the independence criteriaprescribed by the Tokyo Stock Exchange, Inc. shall not be deemed to be independent by
JSF.
1.

A person who is currently:(1) Major shareholder
A person who is a major shareholder of JSF(i.e., a shareholder who holds 10% ormore of voting rights), or, if that person is an Juridical Person, Etc., an executive
director, officer, or other person engaged in the execution of business of that
Juridical Person, Etc..
(2) Major Business Partners
・A person who has JSF as a major business partner (whose transactions with JSF
in the last business year exceeded 2% of JSF’s consolidated gross sales inamount) , or, if that person is an Juridical Person, Etc., an executive director,
officer, or other person engaged in the execution of business of that Juridical
Person, Etc..
・A person who is a major business partner of JSF(whose transactions with JSF in
the last business year exceeded 2% of his consolidated gross sales in amount) , or,if that person is an Juridical Person, Etc., an executive director, officer, or otherperson engaged in the execution of business of that Juridical Person, Etc..
(3) Specialist
A consultant, accounting expert or legal expert who has received money or otherproperty from JSF more than JPY 10 million per one fiscal year, or, if that person is
an Juridical Person, Etc., an executive director, officer, or other person engaged in
the execution of business of that Juridical Person, Etc..
(4) Donations
Anyone who has received donations from JSF more than JPY 10 million per one
fiscal year, or, if that person is an Juridical Person, Etc., an executive director, officer,
or other person engaged in the execution of business of that Juridical Person, Etc..
(5) Close Relative
A close relative of any person (spouse, family within the second degree) who falls
under any of (1) through (4) above

2.

A person who has fallen under any item of (1) through (5) at any time within thepast three years
End10Proposal by
Shareholders

Proposal 2This proposal is based on joint proposals from 2 shareholders.
The content of the proposal and the reasons for the proposal are statedin original text as notified by the proposal shareholder.

Amendment to the Articles of Incorporation to abolish the positionof Chairperson of the Executive Officers(1) Content of Proposal
Amend Article 32 of the current Articles of Incorporation as follows:
Current Articles of Incorporation
Article 32（Executive Officers with Specific Titles）
1. The President and Executive Officer shall be appointed by a resolution of the Board of Directors.
2. In addition to the preceding paragraph, the Company may appoint other Executive Officers withspecific titles by a resolution of the Board of Directors.
Proposed amendment
Article 32（Executive Officers with Specific Titles）
1. The President and Executive Officer shall be appointed by a resolution of the Board of Directors.
2. In addition to the preceding paragraph, the Company may appoint other Vice President
Executive Officers, Senior Managing Executive Officers and Managing Executive Officers by aresolution of the Board of Directors.
(2) Reason for Proposal
It is a well-known fact that for more than 70 years since the Company was listed on the stock
exchange, that the position of president of the Company has been used as an “amakudari (golden
parachute)” destination for former directors of the Bank of Japan (“Former Directors”).
In addition to this, since the 1980s, the Former Directors who were appointed to the position of
President have continued on to be appointed as Chairperson of the Company after retiring as
President.
Essentially, the Company is a company with a Nomination Committee, etc., and its roles areclearly divided between Executive Officers members, who are responsible for business execution,
and Directors, who are responsible for the supervisory function of the Company’s management.
Within this context, the Company has not provided a sufficient explanation as to what role Mr. Eizo
Kobayashi, who assumed the position of Chairperson of the Executive Officers after retiring fromthe position of President of the Company, should play, as well as the significance of Mr.
Kobayashi’s position as the Company’s Chairperson.
Therefore, in order to improve the governance of the Company, the position of Chairperson,
which is a designated seat for amakudari and its significance is further questionable, should be
abolished.

11

The Board of Directors opposes this Proposal.
The Company's business execution is directed and led by the Executive Officer& President, who is the chief management executive. On the other hand, the basicrole of the Chairperson of the Executive Officers is to support the activities of the
Executive Officer & President in determining the overall direction of JSF’s business
operations over the long term, as a person who is familiar with the past history ofJSF.
To give a specific example, while further maintaining and developing the network
outside the company that he built during his career, including his activities in thebusiness world as Chairperson, he is also responsible for supporting the overallmeasures related to the organizational structure as a company with a Nomination
Committee, etc., including the search for outside talent that could be candidates
for Outside Directors, Executive Officers and Corporate Officers. In addition, healso oversees internal controls in general.
Also, in order to enhance the medium- to long-term corporate value of JSF,
leadership is important not only at JSF but also at the group companies that makeup our business portfolio. On this point, organizationally, effectiveness is ensured
by having senior executives of JSF serve as directors of subsidiaries, with the
Executive Officer & President concurrently serving as a director of JSF Trust andBanking Co., Ltd., while the Chairperson of the Executive Officers concurrently
serves as a director of Nihon Building Co., Ltd.. A general overview ofmanagement refers to these activities.
In this way, at JSF, as a company with a Nomination Committee, etc.,
Opinion of supervision and execution are separated. The Chairperson is on the executive side
the Boardand is in a position to oversee business execution jointly with the President, but theof Directors President ultimately has the authority to direct and lead management, and is not
restricted by the Chairperson’s wishes. This point is documented by internal rulesthat were adopted by resolutions of the Nomination Committee and the Board of
Directors.
Please note that the “Corporate Governance System (CGS) Study Group
Report” (hereinafter, “CGS Study Group Report”) published by the Ministry of
Economy, Trade and Industry on March 10, 2017, states that, “there arecompanies where it is appropriate for the Chairperson of the Board of Directors
and the President & CEO to work together as the top management team to jointly
execute business operations, from the perspective of strengthening the leadershipof management.”
As an enterprise that supports the infrastructure of the securities and financial
markets, it is important for JSF to have high creditworthiness based on financial
soundness, fairness, and neutrality. We believe that, as a top executive structure
to support such corporate creditworthiness, it is necessary for the President andthe Chairperson to share roles as described above, while ensuring the President’s
direction and leadership, to enhance corporate value over the medium to longterm.
Also, as this Proposal is related to the appointment and role of the Chairpersonof the Executive Officers, the Nomination Committee has deliberated on this
Proposal and concluded that the role of the Chairperson is important to JSF's
operations, and that is no need to establish a provision such as that of this
Proposal in the Articles of Incorporation.
In light of the foregoing, the Board of Directors has determined that there is noneed to establish a provision such as that of the Proposal in the Articles ofIncorporation.

12

Proposal by
Shareholders

This proposal is based on joint proposals from 2 shareholders.
The content of the proposal and the reasons for the proposal are statedin original text as notified by the proposal shareholder.

Amendment to the Articles of Incorporation concerning disclosure
Proposal 3 of individual remuneration for the Representative Executive
Officer & President(1) Content of Proposal
The following new Chapter and Articles shall be added to the current Articles of Incorporation.
Chapter 9 Disclosure of Compensation of Officers
Article 38（Disclosure of Compensation of Representative Executive Officer & President）
The Company shall individually disclose the amount of compensation (including non-monetarycompensation) paid to the Executive Officers with representation authority in the previous fiscal
year in the Corporate Governance Report that the Company submits to the Tokyo Stock Exchange.
(2) Reason for Proposal
The Company appoints Mr. Shigeki Kushida (“Mr. Kushida”) as its Representative Executive
Officer & President because of his “extensive experience and knowledge in the field of finance andsecurities” as the reason for his appointment. However, Mr. Kushida has repeatedly stated inmeetings with proposing shareholders and at briefings on financial results that “the stock price iscalculated by discounting future cash flows by the cost of capital, and has nothing to do with ROEor net assets,” and that “if we use market capitalization as the E of ROE, as WACC is also
calculated using market value, the Company’s ROE is high.”
Mr. Kushida is a former director of the Bank of Japan and a current director of the Securities
Analysts Association of Japan, but contrary to his background, he lacks basic knowledge related tostock valuations.
Although the Company announced this year its policy "not to include anyone from the public
sector (for Mr. Kushida's future successor)," if Mr. Kushida, who has no knowledge of stock
valuations and allows the stock price to remain below its dissolution value, will continue to serve aspresident, the Company should at least disclose Mr. Kushida's compensation in order to improve
the governance of the Company.

13

The Board of Directors opposes this Proposal.
JSF is continuing its efforts to achieve its medium-term management policy anda 5% ROE and other targets in its Seventh Medium-term Management Plan
(through FY2025), which is the embodiment of its Medium-term Management
Policy. Although JSF is still in the process of achieving this target, we haveachieved our target of 4% ROE for FY2022 (actual ROE of 4.36% for FY2022),
which was set as an interim milestone for the above target, and our total
shareholder return has also significantly exceeded TOPIX in recent years under
our shareholder return policy aiming for a total payout ratio of 100%.
Based on JSF's corporate philosophy and management policy, theremuneration, etc. for JSF's Officers is provided under a system and at a level thatmeets the roles and expected functions of the Directors and Executive Officers,from the perspective of achieving sustainable growth and enhancing corporate
value over the medium to long term. With the start of the Seventh Medium-termManagement Plan, we formulated and announced a remuneration system forofficers after repeated consideration by the Remuneration Committee to ensurethat the incentives are consistent with our management policy, starting from
Opinion of
FY2023 under the Seventh Medium-term Management Plan. The total amount of
the Board
remuneration for Officers is also disclosed for each category of officers inof Directors
accordance with applicable laws and regulations.
Furthermore, although the Proposing Shareholders claim that theRepresentative Executive Officer & President lacks the qualifications required of
executive officers, but with regard to JSF’s Directors & Representative Executive
Officer & President, the skills matrix for Directors, the qualifications for Executive
Officers, and the qualifications for President and Representative Executive Officer
as their leader, respectively, have been established by resolutions of theNomination Committee and Board of Directors. Based on this, he has been
appropriately appointed through resolutions of Nomination Committee, the Boardof Directors, and the General Meeting of Shareholders.
As this Proposal relates to the remuneration of the Representative Executive
Officer & President, the Remuneration Committee deliberated this Proposal, andconcluded that the governance related to the remuneration of JSF's Executive
Officers was properly managed by the Remuneration Committee, that the
remuneration was properly disclosed, and that there is no need to establish aprovision such as that of this Proposal in the Articles of Incorporation.
In light of the foregoing, the Board of Directors has determined that there is noneed to establish a provision such as that of the Proposal in the Articles ofIncorporation.

14

Proposal by
Shareholders

This proposal is based on joint proposals from 2 shareholders.
The content of the proposal and the reasons for the proposal are statedin original text as notified by the proposal shareholder.

Amendment to the Articles of Incorporation concerning the

Proposal 4 prohibition of reemployment, etc. of persons who have served as

President(1) Content of Proposal
The following Chapter and Articles shall be newly added to the current Articles of Incorporation.
Chapter 10 Remuneration for Persons who have Served as President
Article 39（Prohibition of Reemployment of Persons who have Served as President）
1. The Company shall not allow any person who has retired as President of the Company tobecome a Corporate Officer or employee ("Corporate Officer, etc.") of the Company that utilizes
the title of officer, advisor, consultant, etc., nor shall it allow any person who has retired as
President of the Company to become a Corporate Officer, etc. of any wholly owned subsidiary of
the Company.
2. The Company shall not enter into any mandate agreement, outsourcing agreement or othercontinuing agreement ("Continuing Agreement") with any person who has served as President of
the Company, nor shall it allow any of its wholly owned subsidiaries to enter into a Continuing
Agreement with any such person.
(2) Reason for Proposal
It is a well-known fact that governance issues have been raised regarding the existence ofadvisors and consultants. Although there is currently no Special Advisor at the Company, theCompany states that "persons who have served as President may be appointed as Special
Advisors." In addition, following the tradition of the Company that has continued since 1990, it ispresumed that Eizo Kobayashi, the current Chairperson, will naturally be appointed as a Special
Advisor in the near future.
Last year, the proposing shareholders sought to abolish Special Advisors through a shareholder
proposal, but the Company's Board of Directors opposed the shareholder proposal, arguing thatthe existence of Special Advisors is significant because “they are expected to maintainrelationships in the business world, etc., and have a PR effect, and thus enhance the Company's
corporate value.”
However, the then Special Advisor, Mr. Minoru Masubuchi, resigned after last year's Annual
General Meeting of Shareholders, and it became clear that the Special Advisor was not particularly
necessary for the Company.
As it has become apparent that the claimed significance of the existence of the board of
directors is unnecessary, the system of reemployment, etc., after the retirement of the president,
including Special Advisors, should be abolished.

15

The Board of Directors opposes this Proposal.
JSF may appoint a person who has retired as President to the positions ofChairperson of the Executive Officers, Special Advisor, and Honorary Advisor.
As stated in the opinion of the Board of Directors regarding Proposal 2, we donot believe that it is appropriate to establish in the Articles of Incorporation mattersprohibiting the appointment of the Chairperson of the Executive Officers.
JSF may also appoint special advisors for the purpose of engaging in business
community activities and social contribution activities. We believe it is meaningful
for JSF, which is supported by a wide range of stakeholders, that the roles ofmaintaining JSF's network in the economic and financial industry in general,raising JSF's recognition, and contributing to society be shared by the current
President and Chairperson, who are in charge of corporate affairs, as well as otherindividuals who have past experience as President or Chairperson, in order toenhance the corporate value of JSF. A Special Advisor is not involved in any
management decision-making.
The CGS Study Group Report also states, “Enhancement of corporate value isgenerated by the contributions of various stakeholders, such as employees,
customers, business partners, and local communities. When a former president or
Opinion of
CEO takes on roles such as advisor or consultant in social activities or public
the Board
duties, it can be considered significant from the perspective of corporateof Directors
governance.”
JSF does not currently have a Special Advisor, but the appointment of a Special
Advisor is determined by the Nomination Committee, a majority of which is madeup of Outside Directors, adopting a framework that ensures transparency in theappointment, and this is also disclosed in the Corporate Governance Report.
Also, Honorary Advisors are only granted permission to use the title, without
remuneration and with no fixed term of office. Honorary Advisor are not involved inany management decision-making, and are also disclosed in the Corporate
Governance Report.
As this Proposal relates to the appointment of a Chairperson of the Executive
Officers, Special Advisor and Honorary Advisor who has served as President, theNomination Committee has deliberated this Proposal, and has reached theconclusion that the appointment was made appropriately through a transparent
process, that the appointment of the person as Chairperson of the Executive
Officers, Special Advisor and Honorary Advisor will contribute to enhancing thecorporate value of JSF, and that there is no need to establish a provision as that ofthis Proposal in the Articles of Incorporation.
In light of the foregoing, the Board of Directors has determined that there is noneed to establish a provision such as that of the Proposal in the Articles ofIncorporation.

16

Proposal by
Shareholders

This proposal is based on joint proposals from 2 shareholders.
The content of the proposal and the reasons for the proposal are statedin original text as notified by the proposal shareholder.

Amendment to the Articles of Incorporation concerning disclosure

Proposal 5 of remuneration for officers who have served as President after

their retirement from office(1) Content of Proposal
The following new Article shall be added to the current Articles of Incorporation.
Article 40（Disclosure of Remuneration）
When the Company has provided benefits or favors during the previous fiscal year to a person
who has served as president of the Company and who is not a full-time officer or employee of theCompany (“retired President”), it shall individually disclose the details of such benefits or favors(here and hereinafter in this paragraph, including, but not limited to, acts allowing the use of golf
memberships, company cars, or facilities, at no cost or significantly discounted prices) in the
Corporate Governance Report that the Company submits to the Tokyo Stock Exchange. The same
shall apply when a wholly owned subsidiary of the Company provides benefits or favors to theretired President.
(2) Reason for Proposal
The Company has a position of Honorary Advisor in addition to the position of Special Advisor.
The names of the Honorary Advisors are not disclosed, but at least Mr. Kunio Kojima (“Mr.
Kojima”), a former director of the Bank of Japan and a former president of the Company, continues
to serve as an Honorary Advisor to the Company.
The Company discloses that Honorary Advisors “only have permission to use their title andreceive no compensation.” However, it is possible that the Company may have provided someform of non-monetary benefits or favors to Mr. Kojima and other Honorary Advisors, who areamakudari from the Bank of Japan, such as holding golf memberships, allowing them to use
company cars, and providing them with office space, in order to avoid disclosure.
Furthermore, there is a concern that to evade disclosure, the Company may be treating persons
who have served as President of the Company, who are amakudari from the Bank of Japan, as
advisors to its wholly owned subsidiaries, etc.
Note, since these suspicions are nothing more than possibilities, if the Company declares that it
has not provided any benefits or favors as described above, the proposing shareholder will
withdraw this Proposal.

17

The Board of Directors opposes this Proposal.
As described in the opinion of the Board of Directors with respect to Proposal 4,
JSF may commission a Special Advisor for the purpose of engaging in business
community activities and social contribution activities. JSF does not currently havea Special Advisor, but the remuneration of Special Advisors is determined by the
Remuneration Committee, a majority of which is made up of outside directors,
adopting a framework that ensures transparency in the determination of
remuneration, and this is disclosed in the Corporate Governance Report.
Also, a person with past experience as Special Advisor may continue to serve as
Honorary Advisor, without remuneration and with no fixed term of office.
JSF believes that it is meaningful for the Special Advisor or Honorary Advisor to
engage in business community activities and social contribution activities toOpinion of enhance the corporate value of JSF, which is supported by an extensive range of
the Boardof Directors stakeholders. In line with such activities, expenses, office space, transportation,etc. are required, but these are necessary and incidental to business communityand social contribution activities and are not benefits or favors as alleged by the
Proposing Shareholders. Also, with regard to the two Honorary Advisors who are
currently with JSF, although they do not represent JSF, they continue to contributeto JSF in the areas of business community and social contribution activities thatthey have been engaged in since their tenure as Special Advisors, etc. Therefore,
JSF pays only the actual cost and provides office space but does not bear any
additional burden for the Honorary Advisors. The appropriateness of these
expenses and amounts has been confirmed by the Remuneration Committee.
Furthermore, none of the Honorary Advisors have received golf memberships from
JSF, nor are they advisors to any of JSF's consolidated subsidiaries.
In light of the foregoing, the Board of Directors has determined that there is noneed to establish a provision such as that of the Proposal in the Articles ofIncorporation.

18

Proposal by
Shareholders

Proposal 6

This proposal is based on joint proposals from 2 shareholders.
The content of the proposal and the reasons for the proposal are statedin original text as notified by the proposal shareholder.

Amendment to the Articles of Incorporation concerning disclosureof material proposed actions taken by major shareholders(1) Content of Proposal
The following Chapter and Articles shall be newly added to the current Articles of Incorporation.
Chapter 11 Disclosure of Material Proposal Information
Article 41（Disclosure of Material Proposal Information）
1. When the Company receives a proposal that falls under the category of a material proposed
action, etc. (those provided for in Article 27-26, Paragraph 1 of the Financial Instruments andExchange Act and each item of Article 14-8-2, Paragraph 1 of the Order for Enforcement of the
Financial Instruments and Exchange Act; hereinafter, a "Material Proposal"), from a material
shareholder (a shareholder with a shareholding ratio of more than 20% as stated in the mostrecently filed substantial shareholding report or its amendment report.), the Company shall discloseat least the following matters in the first Corporate Governance Report (the “CG Report”) that theCompany submits to the Tokyo Stock Exchange after the Material Proposal is made. However, thisshall not apply if such Material Shareholder opposes such disclosure.
（1）Date on which the Material Proposal was made（2）Name or title of the material shareholder（3）Details of the Material Proposal（4）The Company's response policy
2. The Material Proposals subject to disclosure in the preceding paragraph shall be Material
Proposals made within one year prior to the date on which the Company submits the CG Report.
(2) Reason for Proposal
Symphony Financial Partners ("SFP") is a major shareholder of the Company, holding more than
20% of the total issued and outstanding shares of the Company (the "Over 20% Shareholder").If
the Over 20% Shareholder is a corporation, it is easy to imagine the magnitude of the impact thatSFP will have on the Company, given that the Company will be accounted for by the equity methodof accounting.
In other words, we believe that any Material Proposal made by SFP to the Company is highly
feasible beyond the scope of a typical engagement and could have a significant impact on the
Company's management and shareholder value, as well as on the interests of our generalshareholders.
Therefore, to protect the interests of general shareholders, we seek disclosure of the details of
the Material Proposals received from the Over 20% Shareholder. Furthermore, we would like to
add that the proposing shareholder agrees with the intent of the " Disclosure on Dialogue with
Shareholders" published by the Tokyo Stock Exchange on March 31, 2023, and has no objection
to the disclosure of the details of the proposal made by the proposing shareholder to the Company.

19

The Board of Directors opposes this Proposal.
JSF is committed to constructive dialogue with shareholders within reasonable
limits based on the Corporate Governance Code. During such dialogue, we ensurethat our responses are fully in compliance with laws, regulations and disclosure
regulations.
JSF’s policy and status of its shareholder dialogue efforts have been promptly
disclosed, as set out in the Attachment, and will continue to be updated in
response to the Tokyo Stock Exchange's request on March 31, 2023.
The Attachment discloses our dialogue with shareholders in general, including
domestic and foreign institutional investors, and is more comprehensive andexhaustive than the disclosure of dialogue with individual shareholders as required
Opinion of by the Proposing Shareholders. Through such disclosure, JSF aims to promotemutual understanding through dialogue with various shareholders with differing
the Boardof Directors interests and attributes, to conduct a balanced dialogue with these various
shareholders, and to provide them with fair information. JSF considers this method
to be the most conducive method for the purpose of the Corporate Governance
Code, which advocates a balanced understanding of stakeholders' positions
through dialogue between listed companies and their shareholders, as well as forthe purpose of the disclosure required by the Tokyo Stock Exchange.
On the other hand, the content of the proposal from the Proposing Shareholders
is not only unnecessary but also does not contribute to the provision of balanced
information to JSF's shareholders and those who are considering investing in JSF,
as it further targets only dialogues with specific shareholders, from among JSF's
disclosure as described above.
In light of the foregoing, the Board of Directors has determined that there is noneed to establish a provision such as that of the Proposal in the Articles ofIncorporation.

20

(Attachment) Disclosure of the status of dialogue between JSF and its shareholders as requestedby the Tokyo Stock Exchange〇 Status of Dialogue with Shareholders (FY2022)
As a prime market listed company, JSF, based on the Corporate Governance Code, responds
to dialogues with its shareholders in a positive manner, within reasonable limits, in order tocontribute to the sustainable growth and the enhancement of corporate value over the medium tolong term.
The status of the dialogues with shareholders conducted by JSF's management and others
during FY2022 is as follows.
[Main persons to providing responses]
・ The Representative Executive Officer & President and the Senior Managing Executive Officer
in charge of Corporate Planning are providing responses.
・ Depending on the substance of the dialogue, outside Directors may also respond.
[Overview of shareholders with whom dialogue was held]
Total: 41 times
・ Individual interviews: 39 times(Domestic investors: 9; Foreign investors: 4; Total: 13 companies)
・ Information sessions: 2 times (total of 23 companies participated).
[Main themes, matters of interest to shareholders, etc.]
・ The three main themes and matters of interest in dialogues with shareholders are as follows.
(1) Initiatives and achievements to enhance corporate value and capital efficiency(2) Officer nomination process and initiatives in governance(3) Information disclosure
Below, we introduce specific examples of dialogues, including shareholder opinions, mattersthat were brought to our attention by shareholders and our response to them, and matters thatwere explained to and understood by shareholders.
(1) Initiatives and achievements to enhance corporate value and capital efficiency
The Company explained that it has been striving to improve profitability and capital efficiency
by setting a management goal for achieving a ROE of 5% in excess of the cost of equity (mid
4% range), during the period of the Seventh Medium-term Management Plan in our Mediumterm Management Policy, and also that JSF's ROE has been steadily increasing in recent
years as a result of the initiatives under the Sixth Medium-term Management Plan, and JSF ismaking steady progress toward achieving its ROE target of 4% for FY2022.
Many shareholders understand our cost of equity and management goal, given our nature asa securities finance company, and have positively assessed our efforts and accomplishments
over the past several years. However, there were differences in perception among a portion of
the shareholders regarding the level of the ROE target and the time frame for achieving it.
In addition, we received feedback from shareholders that they would like to see continued
efforts to enhance corporate value after the Seventh Medium-term Management Plan period isover. In light of this, we have indicated that we will further promote our efforts to enhance
corporate value, and will continue our management efforts to achieve a higher ROE level in
FY2026 and beyond.
(2) Officer nomination process and governance initiatives
The Company transitioned to a company with a Nomination Committee, etc. in 2019 and is
working to further enhance and strengthen its corporate governance. The Company published
its policy regarding the composition of the Board of Directors and the appointment of Executive
Officers in FY2021. In our dialogues with shareholders, we provided explanations regarding

21

governance at JSF, focusing on the details of the nomination process for these Officers.
Many of our shareholders have appreciated JSF's governance initiatives.
We also received feedback that, from now on, they expect the disclosure of information to
focus on the evolution of governance efforts to date, the specific status of the nomination
process, the roles played by outside directors, and human capital initiatives. In light of thesecomments, in March 2023, we disclosed on our website our approach to the appointment of
JSF’s management and our internal human resources development policy in anticipation ofthese appointments.
https://www.jsf.co.jp/about/corporate-governance/senninkangaekata/On this webpage, we disclosed the following cases that were proposed as issues raised byoutside Directors regarding the actual operational aspects of Nomination and Remuneration
Committees and the Board of Directors led by outside Directors.
・ Succession planning for the current Representative Executive Officer & President
・ Internal human resource development initiatives in response to the business portfolio
・ More proactive disclosure of our approach to human capital(3) Information disclosure
Although many shareholders have stated that the dialogue has made it possible for them tounderstand JSF's management policies and the special characteristics of JSF on which they
are based, and our various governance initiatives, they also commented that such information
should be widely disseminated to the general public. In response to this, in FY2022, JSF
formulated and published its first Integrated Report incorporating such information. Also, as
mentioned above, in March 2023, we disclosed on our website in March 2023 our approach tothe appointment of JSF's management and our internal human resource development in
anticipation of these appointments. Specifically, the website sets out JSF's approach to theappointment of management based on the business development JSF aims to achieve and thequalities considered important for each of its business portfolios, and explains its approach tothe composition of the management executive team and succession planning for the
Representative Executive Officer & President. Also, from the perspective that the developmentof internal human resources is important for ensuring the effectiveness of management
succession planning, the report explains the direction of human resource development andspecific initiatives. Together, it also describes the specific commitments of the Nomination
Committee and the Board of Directors in the above mentioned initiatives.
We recognize through discussions at the Board of Directors that we need to develop tools
and systems to enhance information disclosure, and JSF will continue to proactively
disseminate information with regard to this as well.
[Feedback from shareholders to the Board of Directors]
・ JSF reports the status of dialogues with shareholders to the Board of Directors promptly after
each dialogue.
・ Through these initiatives, we strive to ensure that the Board of Directors and the various
committees hold discussions that also take into account the feedback of shareholders.
END

22

Ⅰ Matters Pertaining to the Current Status of the Company's Group(1) Business progress and its results(Primary business activities of the corporate group)
The Group consists of the Company, two consolidated subsidiaries (JSF Trust and Banking
Co., Ltd. and Nihon Building Co., Ltd.), and two equity method affiliates. While we firmly
recognize our public role in supporting the infrastructure of the securities and financial markets,
we proactively respond to the diverse requirements of the securities and financial industries andprovide a variety of securities and financial related services, with a focus on the securities financebusiness centered on the margin loan business. Given that the margin loan business is
significantly affected by market fluctuations, we will also continue our efforts to diversify ourrevenue sources and work to achieve our management goals while being more conscious thanever of improving capital efficiency in each of our businesses. Under this concept, JSF Groupwill endeavor to realize its vision of the future through a business portfolio consisting of security
financing business centered on loans for margin transactions, securities investment business,trust banking business and real estate management business.
(Financial and economic environment)
Although the economic environment in this fiscal year is recovering from the stagnation causedby the COVID-19 infection, the outlook remains uncertain due to the situation in Ukraine, rising
prices, and the risk of economic downturn caused by monetary tightening policies in the U.S.
and European countries.
Looking at the stock market, the Nikkei Stock Average, which started at 27,665 yen at the
beginning of the period, rose to 29,222 yen on August 17, 2022, the highest level of the fiscal
year, due to the strong performance of exporting companies against the backdrop of a weakening
yen. This, however, was followed by a sell-off due to the sense of caution over the rapid monetary
tightening in the U.S. After October 2022, when the rise in U.S. interest rates reached a plateau,
the price continued on an upward trend. However, it fell sharply due to the revision of domestic
monetary policy, dropping to 25,716 yen on January 4, 2023, its lowest price for the period.
However, the price subsequently rose again to close at 28,041 yen at the end of the period.
Looking at the the balance of standardized margin transactions buying on the Tokyo market,
etc. (TSE, NSE, and PTS) during this period, it began at the 2.04 trillion yen range at the
beginning of the period and declined to bottom-out at 1.83 trillion yen range for the period, whenstock prices rose in August 2022. Subsequently, as the stock price once again dropped, buyers
began to buy, however, it increased to the 2.24 trillion yen range, the peak of the fiscal year,
when stock prices fell in December 2022, and to the 2.06 trillion yen level at the end of March
2023. Meanwhile, the balance of standardized margin transactions sales declined from the 530
billion yen level at the beginning of the period to bottom-out at the 420 billion yen range in May
2022, and then increased as stock prices rose, reaching as high as 710 billion yen in March 2023
amid rough price fluctuations. The balance was in the 600 billion yen range at the end of March
2023.

23

(Company's initiatives for FY2022 (fiscal year ended March 31, 2023))① Achievements and results
Under the Sixth Medium-term Management Plan formulated in March 2020, JSF has worked
to strengthen the foundation of its competitiveness by establishing an efficient business operation
structure, while promoting efforts to strengthen the foundation of its licensed margin loanbusiness and to diversify its revenue sources. From the perspective of ensuring further
commitment and transparency to achieve sustainable growth and to enhance the corporate value
over the medium to long term based on the advanced governance system as a Company with
Nomination Committee, etc., in November 2021, JSF formulated our Medium-term Management
Policy and set a management goal for achieving a ROE of 5% in excess of the cost of equity(mid 4% range), during the period of the Seventh Medium-term Management Plan (FY2023FY2025). We also have been promoting management reform efforts by mobilizing all the Group's
resources toward achieving this goal.
Actually, the level of ROE has been steadily increasing since FY2019, when JSF became aCompany with Nomination Committee, etc., mainly due to the increased contribution to earnings
from the securities financing business, which we have been steadily working on since the Sixth
and earlier Medium-term Management Plans. It has steadily increased from 2.66% in FY2019 to
4.36% in FY2022, achieving the interim target of 4% ROE set in the Medium-term Management
Policy. We continue to make progress in a manner that puts us on track to achieve the 5% target
by FY2025.
Also, from the perspective of further enhancing shareholder payout, JSF aims to achieve a
total payout ratio of 100% on a cumulative basis by flexibly implementing dividends and sharebuy-backs from FY2021 through FY2025 (when it will achieve its ROE target of 5%). Under thispolicy, the Company declared an annual dividend of 32 yen per share for FY2022, and together
with the dividend, implemented a share buy-back of approximately 3 billion yen. As a result, thetotal payout ratio for FY2022 was 97.6%. In addition to enhanced profitability, as a result of theseproactive shareholder returns, the Company's share price and P/B ratio have been on an upward
trend, and the total shareholder return has risen to a level significantly higher than the TOPIX
average. Please note that FY2023 shareholder payout are projected to be 34 yen per share (anincrease of 2 yen year-on-year), with a maximum share buy-back limit of 3.3 million shares (3.8%of total shares issued) or 3.3 billion yen. The total payout ratio for FY2023 will be 101.4%.

＜Return on Equity (ROE)＞＜Total Shareholders’ Return (TSR)＞

24

② Efforts in Corporate GovernanceJSF has introduced a system to separate supervision and execution as a Company with
Nomination Committee, etc. in 2019, and is working to further enhance and strengthen corporate
governance. In FY2022, we mainly made efforts on the following matters.
・Increased transparency in the nomination process of management
In FY2021, the Company published its approach to the composition of the Board of
Directors and its approach to the appointment of Executive Officers. Based on this, in
FY2022, once determined by the Nomination Committee and the Board of Directors, thespecific operational status of the nomination process for management, in particular theproactive and active involvement of outside Directors in the Nomination Committee, andthe approach to internal human resource development in anticipation to the appointment ofmanagement, were announced in March 2023.
・Determined a remuneration system for Officers in line with the Seventh Medium-termManagement Plan
Based on our corporate philosophy and management policy, the system and level of
remuneration for Officers are designed to match the roles and expected functions of
Directors and Executive Officers from the perspective of achieving sustainable growth andenhancing corporate value over the medium to long term. The Remuneration Committee
considered the design of remuneration for officers based on the approach of corporate
governance, and determined the remuneration for Officers starting from FY2023, in orderto create incentives consistent with the management policies under the Seventh Mediumterm Management Plan starting from FY2023.
[Overview of the new remuneration system for Officers]
・Regarding performance-linked remuneration, it is divided into short-term and longterm incentives, with bonuses positioned as short-term incentives and stock-based
remuneration as long-term incentives.
・Regarding bonuses, consolidated current fiscal year net income shall be used as areference index from the perspective of defining management responsibility for eachfiscal year as a short-term incentive.
・Regarding stock-based remuneration, ROE and consolidated recurring income,which are the management goals of the Seventh Medium-term Management Plan,
will be used as reference indicators as a long-term incentive.
③ Enhancement of information disclosure
In order to provide our shareholders and other stakeholders with a better understanding of theCompany, JSF is proactive in the enhancement of information disclosure. As part of this effort, in
FY2022, JSF formulated our first Integrated Report. The Integrated Report describes theCompany's business model, management policies, characteristics of the Company as asecurities finance company, information on corporate governance including the activities of theBoard of Directors and each Committee, and the status of the Company's efforts to address
sustainability issues.
Also, as described in ②above, in March 2023, we disclosed on our website our approach tothe appointment of management of the Company and our internal human resources development
in anticipation of this appointment.
We will continue to make ongoing efforts to enhance information disclosure.

25

④ Efforts to address sustainability issues.
For the realization of a sustainable society, it is also a critical factor to improve the infrastructurethat serves as the foundation for social and economic activities, which is one of the SDGs
(Sustainable Development Goals) (Goal 9). The Group is striving to improve the liquidity of
securities and financial markets and enhance convenience for market participants by providing
various services, including the margin loan business, as an enterprise supporting the securities
and financial market infrastructure. Through these activities, JSF aims to play a part in therealization of a sustainable society, including the providing of support to market participants who
are making similar efforts.
Based on these basic policies, the Company is promoting environmental (E) and social (S)initiatives. Our main initiatives in FY2022 included the promotion of academic research activities
through industry-academia collaboration, in which we conducted a joint research project with the
University of Tokyo to conduct empirical research on security finance transactions using
distributed ledger technology. We plan to publish a paper summarizing the results of this researchin the near future.
In other areas, we are continuing our efforts to contribute to overseas securities and financial
market infrastructure (technical cooperation and funding for an Indonesian securities financecompany).
We also recognize that addressing climate change is a critical management issue, and in linewith TCFD recommendations, we have disclosed information on climate change on the
Company's website and in our Integrated Report.
(Financial results for FY2022 (fiscal year ended March 31, 2023))
Unit: million of yen

FY2021

FY2022

Amount of
ChangePercentage of
ChangeOperating revenues

30,13842,51812,38041.1 %

Operating expenses

16,53328,765

12,23174.0 %

General andadministrative
expenses

7,368

7,398

29

0.4 %

Operating income

6,235

6,354

119

1.9 %

Recurring income

7,164

7,601

436

6.1 %

Profit attributable toowners of parent

5,174

5,966

792

15.3 %For FY2022, JSF Group’s performance showed an increase in revenue in the securities
financing business due to strong JGB repo/lending and Equity repo and despite an increase inoperating expenses due to the replacement of securities holdings, consolidated operating
income increased 1.9% year-on-year to 6,354 million yen and consolidated recurring profit
increased 6.1% year-on-year to 7,601 million yen, both of which were higher. Net income
attributable to owners of the parent increased 15.3% year on year to 5,966 million yen due to adecrease in retirement benefit obligations resulting from a retirement benefit system change,
which was also recorded as extraordinary profit.

26

(Operating Conditions by Business Segment)
Consolidated operating revenues for the current fiscal year increased by 41.1% year-on-year
to 42,518 million yen due to an increase in revenues from the securities financing business anda gain on sales of securities due to the sale of a portion of securities holdings.
◆Securities Finance BusinessLooking at operating revenues by business segment, operating revenues from the Securities
Finance Business amounted to 38,594 million yen (up 45.3% year-on-year).
・Margin Loan BusinessLooking at operating revenues by business segment, operating revenues from the marginloan business increased 30.8% year-on-year to 8,003 million yen. While the average of marginloans during the period decreased by 28.4 billion yen year-on-year to 254.7 billion yen, andinterest on margin loans decreased. On the other hand, the average of stock loans during theperiod increased by 13.3 billion yen year-on-year to 188.9 billion yen, and both lending feesand premium charges on over-lent stock loan issues both increased.

Amount of Average (billion yen)Margin Loan
Stock Loan

FY2021

FY2022

283.1
175.5

254.7
188.9

Amount of
Change△28.4
13.3

Percentage of
Change△10.0 %
7.6 %・Securities Financing Business
Operating revenue in the securities financing business increase by 42.8% year-on-year to
21,952 million yen.
Of this amount, the balance of bond repo/lending transactions (18,929 million yen, up 47.4%
year on year) remained strong as transaction requirements increased due to tight supply anddemand for JGBs on the back of the Bank of Japan's expanded purchases of JGBs andexpectations of policy changes. Loans to financial instrument companies (1,529 million yen, up
27.8% year on year) increased due to an increase in the average balance of Equity repo during
the period. The balance of general stock lending (799 million yen, up 21.6% year on year)
increased year on year due to increased stock borrowing demand, while the balance of retailloan (544 million yen, up 6.6% year on year) increased due to improvements in product appeal,
both of which resulted in higher revenues. On the other hand, loans for negotiable margintransactions (149 million yen, down 4.6% year on year) experienced a decrease in revenues
due to a decrease in outstanding balance.
・Others
Other income (8,638 million yen, up 70.3% year-on-year) increased mainly due to carry trade
income from securities investments and gains on sales of government bonds and othersecurities holdings resulting from portfolio replacements. Together with this, a loss on sales offoreign bonds was recorded as an operating expense.
◆Trust and Banking BusinessLooking at operating revenues by business segment, operating revenues from the Trust andBanking Business amounted to 3,115 million yen (up 13.8% year-on-year). Trust fees from
custodian type trust services remained strong.
◆Real Estate Management Business
Operating revenue in the real estate leasing business amounted to 808 million yen (down 4.0%
year-on-year).

27

(2) Issues to be addressed
On February 6, 2023, the Company published its Seventh Medium-term Management Plan
(FY2023-FY2025), which began in FY2023. This summarizes the Company's management
policy for the next three years and the strategies and measures that will embody this policy inorder to achieve the medium-term management goal for achieving a ROE of 5% in excess of thecost of equity (mid 4% range). Under the new Medium-term Management Plan, JSF will
accelerate and deepen the management reform efforts that the Company has been pursuing,
and in order to flexibly and nimbly respond to the various environmental changes of business,
we will further develop an efficient business operation structure while striving to improve
corporate vitality and organizational transformation through human resource development andensuring diversity.
(Positioning of the Seventh Medium-term Management Plan)(Overview of the Seventh Medium-term Management Plan)

28

(The Direction of Specific Initiatives)
As part of “enhance the margin loan business,” JSF will respond appropriately to changes inthe stock market environment to ensure stable operations of the margin loan business, andconsider measures to promote the use of loans for margin transactions by accurately grasping
the trading requirements of market participants.
In the securities financing business, we will leverage our accumulated expertise in funds
transactions and securities transactions to proactively respond to diverse transactions withdomestic and overseas counterparties and expand profit-earning opportunities by expanding
the range of counterparties, target currencies, securities, etc.
In addition to this, we have recently set forth a new strategy of “strengthening human resource
development and improve engagement” and formulated “Human Capital Policies” as our basic
approach for promoting initiatives related to the formation of “human capital,” such as humanresource development, with the aim of strengthening the foundation of human resource
capabilities, which are the source of enterprise value creation.
(Human Capital Policies)● We respect the diverse values of our employees and will strive to provide
opportunities and supportive environments so that diverse individuals canmaximize their individuality and strengths and grow on their own through theperformance of their work.

Vision● We will promote the creation of comfortable work environments so that
employees can engage in their work with peace of mind.
● We will improve our corporate vitality and organizational transformation capability,
and achieve more productive working styles by working to improve employee
engagement.

● Talent that respect diverse values and work together with other employees toenhance corporate value● Talent who are able to accurately and stably perform even the most complicatedtasks and contribute to maintaining the reliability of the Company's infrastructure
function

Our image of
expectations forhuman
resources● Talent who are able to strive to gain a deeper and broader understanding of theirassigned work, and who are able to lead business transformation while
enhancing their expertise in the relevant field● Talent who have expertise in a certain field and are able to lead and contributewithin the company by making use of their expertise● Talent who are able to voluntarily set high goals and work independently to realize
them with the involvement of the people around them
● Talent who are able to take a leading role in management strategy from a broad
perspective

29

● In addition to the hiring of new graduates, we actively and１．Recruitment

continuously hire people with prior experience in order tosecure a diverse workforce.
● We have created environments for autonomous careerdevelopment that allows employees to maximize theirindividuality and strengths and grow on their own throughthe performance of their work.

２．Training andcareer advice● In order to support autonomous career development andchallenges, we have established new human resources
development programs, including revised and new
training programs.
● We are strengthening the talent pool that can take aleading role in management strategy based on diversity,
expertise, and independence.

Efforts towards
our Vision● We will appropriately assess our contribution to theperformance of our employees’ work, including thedegree to which they have developed their abilities,

３．Evaluation
andremuneration

demonstrated their performance, and fulfilled their
expected roles.
● We will assess our independent approach and actions
toward employees' work, such as work reform, work
efficiency improvement, and voluntary efforts to achieve
highly evaluated goals.
● We will create a workplace environment that ensures
work-life balance by promoting the use of various leavesystems to help employees balance childcare/nursing

４．Environment

care with their work.
● We will promote the creation of a comfortable workplaceenvironment that enables diverse work styles through theutilization of telework.

JSF aims to maintain the high degree of financial soundness required of a securities financecompany that supports the infrastructure of the securities and financial markets, and to becomea unique company with the agility and flexibility to achieve sustainable growth and increase themedium to long-term enhancement of its corporate value under the Company's corporate
philosophy and the Seventh Medium-term Management Plan that has been formulated this time.

30

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

FY2019From April 1, 2019
to March 31, 2020

) (FY2020From April 1, 2020
to March 31, 2021

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

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

Operating revenues(mil yen)

29,10130,92430,13842,518Recurring income(mil yen)

4,894

5,558

7,164

7,601

Profit attributableto owners of parent(mil yen)

3,556

3,971

5,174

5,966

(yen)

38.47

43.28

56.61

67.76

(mil yen)

126,687

135,166

137,996

135,728(yen)

1,381.22

1,473.24

1,545.03

1574.64

Net income per share
Total net assets
Book value per share)(4) Main Business（As of March 31, 2023）
JSF group engages in the following businesses, including the lending and borrowing business,
which is licensed under the Financial Instruments and Exchange Law.
① Securities Finance BusinessMargin Loan Business
Loan of funds and stock certificates to securities companies, necessary for Standardized Margin Transaction
conducted on every stock exchange markets and on proprietary trading systems (PTS)
Securities Financing Business
General loans（Loan secured by securities）

Securities Lending

Loan to Securities Companies
Equity Repo
Loans for Negotiable Margin Transaction（Loan funds needed to settle
negotiable margin transactions）
Retail Laon （ Securities-backed loan for Individuals and businesscorporations）
Bond repo / lending transactions
General Stock lending（Lending stock certificates needed to settle stock
trading）

Securities Investment Business② Others
Trust and Banking Business

Trust service and banking service

Real Estate Management Business

Real estate ownership and leasing(5) Business Office（As of March 31, 2023）① JSF
Head Office

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

Osaka branch

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

1-2-14 Nihonbashi-Kayabacho, Chuo-ku, Tokyo(6) Capital Investment
Capital investments totaling ¥0.6 bn were made during the fiscal year under review.
These investments were mainly due to the server replacement of our core system.

31

(7) Employees of the Group（As of March 31, 2023）① JSF group
Segment

The number of employees

Year on Year

Securities Finance Business211［4］+4［―］

Trust and Banking Business

42［1］

+1

［―］

Real Estate Management Business

15［0］

△1

［―］

268［5］

+4

［―］

Total

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

② JSF
The number of
employees
211［4］

Year on Year

Average age

+1［―］

44.4

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

(8) Subsidiary Companies（As of March 31, 2023）
Name
JSF Trust and Banking Co., Ltd.

Capital Stock（billion yen）
14

Investment
Ratio（%）
100

0.1

100

Nihon Building Co., Ltd.
(Note) Affiliated companies are as follows
Japan Information Processing Service Co., Ltd.
JSF Information Technology Co., Ltd.

(9) Major Borrowings（As of March 31, 2023）
Disclosure is omitted because the amount of borrowings is immaterial.

32

Principal Business
Trust and Banking Business
Real Estate Management BusinessⅡ Matters Concerning Shares of the Company （As of March 31, 2023）(1) Total number of authorized shares

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

96,000,000 shares(3) Number of shareholders

10,561 persons(4) Major Shareholders（Top 10）
Number of Shares HeldThe shareholding（thousand）

ratio（%）

THE SFP VALUE REALIZATION MASTER FUND LTD．

12,674

14.5

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

10,214

11.7

Capital Market Promotion Foundation

4,654

5.3

4,307

4.9

Mizuho Bank, Ltd.

3,536

4.1

Custody Bank of Japan, Ltd. (Trust account)
INTERTRUST TRUSTEES(CAYMAN) LIMITED SOLELY IN ITSCAPACITY AS TRUSTEE OF JAPAN-UP
INTERTRUST TRUSTEES CAYMAN LIMITED AS TRUSTEE OF
JAPAN-UP UNIT TRUSTSTATE STREET BANK WEST CLIENT – TREATY 505234

3,480

4.0

3,109

3.6

1,725

2.0

1,670

1.9

BNYM AS AGT/CLTS 10 PERCENT

1,479

1.7

Name

THE CHASE MANHATTAN BANK, N.A. LONDON SPECIALOMNIBUS SECS LENDING ACCOUNT(Note) In addition to the above, there are 8,770,527 shares of treasury stock owned by the Company, as of March 31, 2023.
The shareholding ratio is calculated excluding treasury stock.

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

Number of shares
Executive officer

Number of persons issued
shares55,600 shares

1 person(Note) The Company delivers shares of the Company's stock at retirement through a Board Benefit Trust mechanism.

(6) Other important matters concerning shares
JSF canceled 8,000,000 shares of treasury stock on April 20, 2023 based on a resolution passed at a meeting of
the Board of Directors held on March 20, 2023.

33

Ⅲ Matter related to the director of the company(1) Directors（As of March 31, 2023）
Classification

Name

Position

Naotaka Obata

Nomination Committee Member(Chairperson)
Remuneration Committee
Member (Chairperson)

Director

Shoko Sugino

Nomination Committee Member
Audit Committee Member
Remuneration Committee
MemberPartner Attorney at Fujibayashi Law
OfficeAudit & Supervisory Board Member ofTakeei Corporation
Outside Director of Janome
Corporation

Director

Shuya Iimura

Audit Committee Member(Chairperson)

Audit & Supervisory Board member ofIntellex Co., Ltd.

Director

Kensuke Futagoishi

Nomination Committee Member
Remuneration Committee
MemberTakayoshi Yamakawa

Audit Committee Member
Remuneration Committee
MemberRepresentative Partner of Business
Producer LLC
Outside Director of Akatsuki Securities,
Inc.
Outside Director of FP Corporation

Shigeki Kushida

Nomination Committee Member
Remuneration Committee
MemberDirector of JSF Trust and Banking Co.,Ltd.
Outside Director of Denso Corp.

Hiroshi Asakura

Audit Committee Member

Director
Chairperson of theBoard of Directors

Director

Director(Representative
Executive Officer &President)

Director

Significant concurrent positions(Note)1. The five Directors, Mr. Naotaka Obata, Ms. Shoko Sugino, Mr. Shuya Iimura, Mr. Kensuke Futagoishi and Mr. Takayoshi Yamakawa are outside
Directors.
2. The Company has selected Shuya Iimura as a Standing Member of the Audit Committee from the perspective of ensuring the effectiveness of the
Audit Committee's audits.
3. The Company has designated outside directors, Mr. Naotaka Obata, Ms. Shoko Sugino, Mr. Shuya Iimura, Mr. Kensuke Futagoishi and Mr. Takayoshi
Yamakawa as Independent Officers pursuant to the provisions of the Tokyo Stock Exchange, Inc., and has notified the Tokyo Stock Exchange, Inc.
to that effect.
4. Pursuant to the provisions of Article 427, Paragraph 1 of the Companies Act, the Company has entered into Limited Liability Agreements withdirectors (excluding executive directors, etc.) under Article 423, paragraph (1) of the Companies Act. The maximum amount of liability for damages
under such agreement is the minimum liability amount stipulated in the Companies Act.
5. There exists no personal, capital, business or other interest to be noted with other companies in which the outside director concurrently serves or
has served as an officer.
6. The Company has concluded a Directors' and Officers' Liability Insurance Policy as stipulated in Article 430-3, paragraph (1) of the Companies Act,
insuring its directors, executive officers, corporate officers, and other important employees, as well as officers of subsidiaries. The insurance
premiums, including the rider portion, are borne entirely by the company, and there is effectively no insurance premium burden on the insured.
Damages in cases where the insured officers are liable for the execution of their duties, etc., or where the insured officers are subject to claims forsuch liabilities (compensation for damages and litigation expenses) are to be covered under such insurance policy. However, there are certain
exclusions of liability, such as the policy does not cover damages arising from an act committed with knowledge that the act is in violation of laws
and regulations. The relevant insurance policy has a provision for a deductible amount, and damages up to such deductible amount shall not becovered.

34

(2) Attendance at meetings
Name

Board of Directors

Nomination Committee

Audit Committee

Remuneration Committee

Naotaka Obata

13/13（100％）8/8（100％）―

7/7（100％）

Shoko Sugino

13/13（100％）8/8（100％）

13/13（100％）

7/7（100％）

Shuya Iimura

13/13（100％）―

13/13（100％）―

Kensuke Futagoishi

10/10（100％）8/8（100％）―

6/6（100％）

Takayoshi Yamakawa

10/10（100％）―

11/11（100％）6/6（100％）

Shigeki Kushida

13/13（100％）8/8（100％）―

7/7（100％）

Hiroshi Asakura

13/13（100％）―

13/13（100％）―(Note) Attendance at meetings of the board of directors and committees held after assuming as directors.

(3) Status of primary activities of outside officers
Name

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

Naotaka Obata

Naotaka Obata draws on his extensive experience and broad insight as a manager of major financial
institutions to sufficiently fulfill the roles and responsibilities required of an outside Director, including
effective supervision over the Company's management, determination of medium- to long-term
management policies, and providing advice on overall management. At Meetings of the Board of
Directors, as Chairman, he manages the agenda and makes proposals and provides advice on theformulation of the Medium-term Management Plan and risk management systems. At Nomination
Committee and Remuneration Committee meetings, he manages the proceedings as chairman, andexpresses necessary opinions as a member in the review and deliberation of management selectionplans, composition of the Board of Directors, and other matters.

Shoko Sugino

Shoko Sugino draws on her extensive experience and broad insight as an attorney to sufficiently fulfill theroles and responsibilities required of an outside Director, including highly effective supervision of theCompany's management and advice on overall management. At the Meetings of the Board of Directors,
she makes proposals and provides advice on the formulation of the Medium-term Management Plan andinitiatives related to compliance. At the Nomination Committee and Remuneration Committee, as amember of the Committees, she expresses necessary opinions in the review and deliberation ofmanagement selection plans, composition of the Board of Directors, and other matters. In addition, as amember of the Audit Committee, she drafts audit plans, interviews the accounting auditor regarding thestatus of the audits and their results thereof, and expresses her opinions as necessary.

Shuya Iimura

Shuya Iimura draws on his extensive experience and broad insight in the securities sector to sufficiently
fulfill the roles and responsibilities required of an outside Director, including effective supervision of theCompany's management and advice on overall management. In addition, as a Standing Audit Committee
Member and a Director, he endeavors to improve auditing and supervision by attending important internal
meetings and receiving reports from the Internal Audit Department. At the Audit Committee meetings, heengages in the management of the agenda as the Chairman of the Committee. As a member of theCommittee, he formulates audit plans, interviews the accounting auditor regarding the implementation
status of audits and the results thereof, and expresses his opinions as necessary.

Kensuke Futagoishi

Kensuke Futagoishi draws on his extensive experience and broad insight in the management of financial
institutions with unique and cutting-edge business models to sufficiently fulfill the roles andresponsibilities required of an outside Director, including supervision of management and advice on
overall management. At Meetings of the Board of Directors, provides advice on the formulation of theMedium-term Management Plan and risk management systems. At the Nomination Committee andRemuneration Committee, as a member of the Committees, she expresses necessary opinions in thereview and deliberation of management selection plans, composition of the Board of Directors, and othermatters.

Takayoshi Yamakawa

Takayoshi Yamakawa draws on his extensive experience and broad insight into trends in technologicalinnovation and corporate management related to digital transformation, etc. to sufficiently fulfill the roles
and responsibilities required of an outside Director, including effective supervision over the Company's
management and advice on overall management. At Meetings of the Board of Directors, provides advice
on the formulation of the Medium-term Management Plan and business operations related to financialtransactions. At the Remuneration Committee, as a member of the Committee, he expresses necessary
opinions in the review and deliberation of management selection plans, composition of the Board of
Directors, and other matters. In addition, as a member of the Audit Committee, she drafts audit plans,interviews the accounting auditor regarding the status of the audits and their results thereof, andexpresses his opinions as necessary.

35

(4) Executive Officers （As of March 31, 2023）
Position

Name

Responsibilities and Significant concurrent positions

Chairperson

Eizo Kobayashi

Director of Nihon building Co., Ltd.
Director of Japan Information Processing Service Co., Ltd.
Director (Audit & Supervisory Committee Member) of Fujimori
Kogyo Co., Ltd.

Representative
Executive Officer &President

Shigeki Kushida

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

Vice President

Shunichiro Higuchi

Senior Managing
Executive Officer
Managing Executive
OfficerManaging Executive
OfficerManaging Executive
Officer

Yutaka Okada
Masaru SekiguchiInternal Audit Dept. Compliance Dept.
Corporate Governance Office. Business Development Dept.
Treasury Dept. International Relations
Risk Management Dept. Human Resources Dept.
Corporate Planning Dept. Group Companies Relations

Morikuni Shimoyamada

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

Shinichi Sugiyama

Settlement & Custody Dept. Information System Planning Dept.
Osaka Branch(Note) 1. Shigeki Kushida, President and Representative Executive Officer, also serves as a Director.
2. Shunichiro Higuchi, Vice President, retired from his position on March 31, 2023 due to the expiration of his term of office.
Also, as of April 1, 2023, Morikuni Shimoyamada, Executive Managing Officer, was promoted to Senior Executive Managing Officer, and Wataru
Sato was newly appointed to the position of Executive Managing Officer.

【Reference】Executive Officers (as of April 1, 2023)
Position

Chairperson
Representative
Executive
Officer & President
Senior Managing
Executive Officer
Senior Managing
Executive Officer
Managing Executive
OfficerManaging Executive
OfficerManaging Executive
Officer

Name

Responsibilities

Eizo Kobayashi
Shigeki Kushida
Yutaka Okada

Corporate Governance Office Business Development Dept.
Treasury Dept. International Relations

Morikuni Shimoyamada

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

Masaru Sekiguchi

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

Shinichi Sugiyama

Internal Audit Dept. Compliance Dept.

Wataru Sato

General Manager of Human Resources Dept.

36

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

Directors

Total amount of
Performance-linked remuneration, etc.
remuneration, etc.
Non-monetary and(Thousands of yen) Base remunerationBonusstock-based
remuneration

Number of
persons(persons)

69,96069,960――6

61,56061,560――5

Executive Officers

329,977

219,480

72,23038,267

7

Total

399,937

289,440

72,23038,267of which Outside Directors(Note) 1. Directors who also serve concurrently as Executive Officers are not paid remuneration as directors.
2. Business performance indicators for performance-linked remuneration, etc. (bonuses) are the number of lending issues, basic profit, andconsolidated current fiscal year net income, which were 2,702 stocks, 8,610 million yen, and 5,966 million yen, respectively.
3. The business performance indicator for performance-linked remuneration, etc. (non-monetary and stock-based remuneration) is consolidated
recurring income (three-year average), which totaled 6,774 million yen.

(6) Policy for determining the amount of remuneration, etc. of Officers or the method for calculating
the amount of remuneration, etc.
① Content of policy and method of determining the amount of remuneration, etc. of officers or the method of calculating
the amount of remuneration, etc.
Based on the Company's corporate philosophy and management policy, the remuneration, etc. of the Company's
Officers is a system and at a level that matches the roles and expected functions of the Directors and Executive
Officers from the perspective of achieving sustainable growth and enhancing corporate value over the medium tolong term. Specifically, the Remuneration Committee determines remuneration, etc. on an individual basis based on
the following policy determined by the Remuneration Committee. The Remuneration Committee has confirmed thatthe method of determining the details of remuneration, etc. and the details of remuneration, etc. determined for eachindividual director for the current fiscal year are consistent with such determination policy, and has judged that thedetails of remuneration, etc. are in line with such determination policy.
[Directors]
・From the perspective of exercising supervisory function, Directors shall receive only a fixed monthly remuneration(base remuneration) and shall not receive performance-linked remuneration, etc.
・Each individual Director's remuneration will be based on their responsibilities as a Director, such as whether they servefull-time or part-time and have been appointed as Chairperson.
・Directors who also serve as Executive Officers will not receive remuneration as directors.
[Executive Officers]
・From the standpoint of linking the remuneration to the Company's business performance and stock value, Executive
Officers shall be paid a fixed monthly remuneration (base remuneration) and performance-linked officer bonuses andstock-based remuneration.
・The fixed monthly remuneration (base remuneration) is determined in accordance with each Executive Officer's
position.
・From the standpoint of clarifying management responsibility, Officers' bonuses are determined after the end of the
fiscal year, linked to the status of achievement of management goals in the Medium-term Management Plan and theperformance of each fiscal year, and are paid within three months after the determination.
・Regarding stock-based remuneration, the Company grants points determined in conjunction with medium- to longterm performance using a Board Benefit Trust mechanism, and delivers Company shares in proportion to the numberof points at the time of retirement.

37

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

Officer bonus

Stock-based remuneration

20％

15％

③ Indicators for performance-linked remuneration, reasons for selecting these indicators, and method of determining
performance-linked remuneration
Among the Company's Executive Officers' remuneration, indicators related to Officers' bonuses, which are
performance-based remuneration and stock-based remuneration are as follows.
[Officer bonus]
・Bonuses are determined by multiplying the standard bonus calculation amount for each Executive Officer's positionby the performance-linked coefficient (bonus).
・The performance-linked coefficient (bonus) is determined by multiplying each of the three indicators (number of lending
issues, basic profit, and consolidated current fiscal year net income) by the ratio of change from the previous year toeach indicator, which reflect the degree of progress and achievement of management goals.
[Stock-based remuneration]
・The number of base points will be determined based on each Executive Officer's position.
・Based on the base number of points, if the average consolidated ordinary profit or loss for the past three years,
including the current fiscal year, exceeds the benchmark, an addition is made, and if it falls below the benchmark, asubtraction is made.
・The Company uses consolidated recurring income as an indicator for the purpose of increasing the linkage withshareholders' interests over the medium to long term by using its performance, excluding the impact of one-time profit
or loss.

Ⅳ Dividend Policy
Solid equity capital to secure the financial health and management stability that society demands of the company as
the infrastructure of securities market, and provide stable long-term return to shareholders by comprehensively
considering revenues environment or investment plan, etc. At the same time, JSF will strive to place more importanceon shareholders return. Based on this basic approach, JSF will strive to further enhance shareholder returns.
JSF has set the goal of achieving a total payout ratio of 100% on a cumulative basis in the years from FY2021 throughFY2025 through dividend payments and agile implementation of share repurchases. With regard to dividends, JSF aims
to proactively pay dividends to the extent that the annual dividend per share does not fall below ¥30.
The year-end dividend for the current fiscal year will be ¥16 per share according to the resolution of the Board of
Directors meeting held on May 15, 2023.
Together with the interim dividend of ¥16 per share, which has already been paid, the annual dividend will be ¥32 pershare (up ¥2 from the previous fiscal year). The effective date of the year-end dividend payment will be Thursday, June
1, 2023.

38

Consolidated Financial Statements
Consolidated Balance Sheets
Account

Unit: millions of yen

Fiscal 2022

Account(As of March 31, 2023)

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

AssetsTotal Current assets
Cash and deposits

13,261,853
1,598,274

Securities

71,013Operating loans
Securities
purchased
underresale agreements
Cash collateral provided for
securities borrowed

955,550

Other

3,561,406
6,669,821
405,951

Allowance for doubtful Accounts
Total Non-current assets△165
794,364

Total property, plant and equipment

5,997

Buildings and structures, net

2,150

Tools, furniture and fixtures, net

580

Land

3,264

Construction in progress

1

Intangible assets

916

Software

902

Other

14

Total Investments and other assets
Investment securities

787,450
745,621

Bad debts

81

Retirement benefit assets

1,180

Other

40,648

Allowance for doubtful accounts

Total assets△81

14,056,217

Note) Amounts less than one million yen are disregarded.

39

Fiscal 2022
(As of March 31, 2023)

13,682,448
2,190,400
92,0101,000
451,000
4,781,801
5,073,776
750
495
107
871,335
219,774
238,040
232,700
2,196
74
240
217
56
2,013
542
13,920,489
129,925
10,0008,878
118,702△7,655
5,802△4,300
9,782
168
152
135,728
14,056,217

Consolidated Statement of Income

Unit: millions of yen

Fiscal 2022

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

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

42,5182,486
10,683
2,553
12,844
13,94928,765
1,033
6,015
13,456
8,258

Operating gross profit

13,753

Total general and administrative expenses

7,398

Operating profit

6,354

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

1,257
454
523
156
122
10
0
8
2
0

Ordinary profit

7,601

Total extraordinary income
Gain on revision of retirement benefit plan

671
671

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

8,273
1,965
340

2,306

ProfitProfit attributable to non-controlling interests

5,966

Profit attributable to owners of parent

5,966

－

Note) Amounts less than one million yen are disregarded.

40

Consolidated Statement of Changes in Equity(From April 1, 2022 to March 31, 2023)

Unit: millions of yen

Share capital
Balance at April 1, 2022

Capital surplus

10,000Shareholders’equity
Retainedearnings

8,878

Treasury shares

Total shareholders’equity△4,680129,719

115,521

Changes arising during the year
Cash dividends
Net income attributable to owners ofparent△2,786△2,786

5,966

5,966

Purchase of treasury share△3,000△3,000

Disposal of treasury share

26

26

Net changes other thanshareholders’ equity
Total changes during the year
Balance at March 31, 2023

－

－

3,180

△2,974206

10,0008,878

118,702△7,655

129,925
Unit: millions of yen

Accumulated other comprehensive income
Valuation
Deferreddifference on
gains or losses
available-for-saleon hedges
securities
Balance at April 1, 2022

9,920

Revaluation
reserve for landRemeasuremen
ts of defined
benefit plans

Total
accumulated
othercomprehensive
income

168

156

8,277

△1,967

Total net assets

137,996

Changes arising during the year
Cash dividends△2,786

Net income attributable to owners ofparent

5,966

Purchase of treasury share△3,000

Disposal of treasury share

26

Net changes other thanshareholders’ equity△14,220

11,749Total changes during the year

△14,220

11,749△4,300

9,782

Balance at March 31, 2023－

Note) Amounts less than one million yen are disregarded.

41△4△2,474△2,474－△4△2,474△2,268

168

152

5,802

135,728

Financial Statements
Balance Sheets
Account

Unit: millions of yen

Fiscal 2022

Account(As of March 31, 2023)

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

AssetsTotal Current assets

12,093,173

Cash and deposits

797,098

Securities

44,120Operating loans

445,723

Margin loan

282,157

Loan to securities companies
and individual investors

94,065

Other loans

69,500

Securities purchased underresale agreements

3,561,406

Cash collateral provided for
securities borrowed

6,840,232

Other

404,643△51

Allowance for doubtful accounts
Total Non-current assets

389,117

Total property, plant and equipment

1,971

Buildings and structures, net

587

Tools, furniture and fixtures, net

552

Land

830

Construction in progress

0

Intangible assets

634

Software

621

Other
Total Investments and other assets

13
386,511

Investment securities

323,497

Shares of subsidiaries andassociates

25,538Bad debts

81

Retirement benefit assets

1,007

Other

36,468△81

Allowance for doubtful accounts

Total assets

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

12,482,291

Total liabilities and net assets

Note) Amounts less than one million yen are disregarded.

42

Fiscal 2022
(As of March 31, 2023)

12,306,998
1,710,400
85,2701,000
451,000
4,781,801
5,061,056
350
419
107
97,263
118,330
53,72050,800
883
74
240
1,722
12,360,718
118,925
10,000
8,878
5,181
3,697
107,693
2,278
105,415
2,030
77,03026,355△7,646
2,647△4,442
6,922
168
121,573
12,482,291

Statement of Income

Unit: millions of yen

Fiscal 2022

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

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

38,631
2,454
10,683
2,578
407
12,8289,680
28,268
674
6,015
790
13,655
7,132

Operating gross profit

10,363

Total general and administrative expenses

5,972

Operating profit

4,390

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

5,895
5,619
156
120
10
8
2
0

Ordinary profit

10,274

Total extraordinary income
Gain on revision of retirement benefit plan

671
671

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

10,946
1,279
364

Profit

1,644
9,302

Note) Amounts less than one million yen are disregarded.

43

Statement of Changes in Equity(From April 1, 2022 to March 31, 2023)

Unit: millions of yen
Shareholders’equity

Capital surplus

Retained earnings
Other retained earnings

Share capital

Balance at April 1,
2022

10,000Capitalreserve

Other capitalsurplus

5,181

3,697

Total
capitalsurplus

8,878

Legal
retainedearnings

Reserve fordividends

Voluntary
reserve

Retainedearnings
brought
forward

Total
Retainedearnings

2,278

2,030

77,03019,839101,177△2,786△2,786

9,302

9,302

Changes arising during
the year
Cash dividends
Net income
Purchase of treasury
share
Disposal of treasury
share
Net changes otherthan shareholders'equityTotal changes during
the year

－

－

－

－

－

－

－

6,516

6,516

Balance at March 31,
2023

10,000

5,181

3,697

8,878

2,278

2,030

77,03026,355

107,693

Unit: millions of yen
Shareholders’equity
Treasuryshare
Balance at April 1,
2022△4,672

Valuation and translation adjustments

Valuation
DeferredTotal
difference on
gains orShareholders' available-forlosses
equitysaleon hedges
securities
115,383

7,257△1,631

Total
Revaluation
Valuation andreserve fortranslation
land
adjustments
168

5,794

Total
net assets

121,178

Changes arising during
the year
Cash dividends
Net income△2,786△2,786

9,302

9,302

Purchase of treasury
share△3,000△3,000△3,000

Disposal of treasury
share

26

26

26

Net changes otherthan shareholders'equity△11,700

8,553－△3,147△3,147

Total changes during
the year△2,974

3,541△11,700

8,553－△3,147394

Balance at March 31,
2023△7,646

118,925△4,442

6,922

168

2,647

121,573Note) Amounts less than one million yen are disregarded.

44