SBI E*TRADE SECURITIES Co., Ltd.
Financial Review
Fiscal Year Ended March 31, 2008

April 24, 2008
SBI E*TRADE SECURITIES Co., Ltd.
Stock code: 8701
The items in this document are provided by E*TRADE SECURITIES as information related to its business strategy and not as an invitation
to invest in E*TRADE stock or securities. E*TRADE does not guarantee the completeness of this document in terms of information andfuture business strategies. The contents of this document are subject to revision or cancellation without warning.

1. Financial Highlights

Consolidated Financial Highlights for Fiscal 2008
Although revenues increased as a result of diversification efforts,
net income decreased due to higher expenses associated with mergers. (Million yen, %)Year ended March 2007

Year ended March 2008

YoY Change

Operating revenues

57,41264,499+12.3

Net operating
revenues

53,29658,017+8.9

Operating income

24,543

22,842-6.9

Ordinary income

24,571

22,405-8.8

Net income

13,811

11,923-13.7#1. Regarding OHT shares , ¥910 millions was posted as an allowance for doubtful accounts in fiscal 2008.
#2. With basic agreements concluded regarding sales of shares of E*TRADE Korea, ¥1.49 billion was posted as deferred tax liabilities.
#3. As for the former SBI Securities, which was merged, operating revenues for the period from October 2007 to March 2008 were 1.95 billion
yen, with ¥2.75 billion as selling, general and administrative expenses.

<3>

Consolidated Quarterly Financial Highlights for FY 2008
Fourth quarter performance declined due to poor market conditions andhigher merger costs(Million yen, %)Fiscal 2008
1Q

2Q

3Q

4Q

(Apr-June, 2007)(July-Sep, 2007)(Oct-Dec, 2007)(Jan-Mar, 2008)

Operatingrevenues

15,44017,13817,205

14,715-14.5

Net operating
revenues

14,115

15,133

15,675

13,092-16.5

Operatingincome

6,113

6,544

5,966

4,217

-29.3

Ordinary
income

6,112

6,426

5,921

3,945

-33.4

Net income

3,221

4,113

4,202

385

4Q vs.3Q*-90.8* With basic agreements concluded regarding sales of shares of E*TRADE Korea, ¥1.49 billion was posted as deferred tax liabilities in the
fourth quarter.

<4>

Highlights of Fiscal 2008 Consolidated Performance(1) Brokerage commissions: Down 2.6% YoY to ¥30,873 million
・1,662,051 customer accounts (Mar. 31, 2008); 256,154 new accounts (monthly average of 21,346).
・Share of retail brokerage trading value rose to an all-time high of 39.7% (4Q FY2008).

(2) Financial revenues: Up 24.5% YoY to ¥21,743 million
・
Increased due to rising interest rates; Net financial revenues up 23.0% YoY to ¥16,471million.
・169,443 margin accounts (Mar.31, 2008); 21,784 new accounts in FY 2008(monthly average of 1,815).

(3) Underwriting, offering and selling commissions: Up 28.1% YoY to ¥2,504 million
・Investment trusts revenues jumped130.2% YoY to ¥3,816Million yen due to diversified products.
・Participated in underwriting of offerings of 58 companies, E TRADE ranking first in the industry.

(4) Trading gains and others: Up 49.1% YoY to ¥9,378 million
・Foreign exchange margin trading accounts and trading volume increased due to fee reduction.
・Other operating revenues increased in part due to sales of IT systems subsidiaries.

(5) Selling, general and administrative expenses
・SG&A increased due to business expansion after merger with the former SBI Securities.

(6) E*TRADE Korea CO., Ltd.
・For E*TRADE Korea, operating revenues up 54.2%; net income up 112.3%; thanks to active markets.

<5>

FY08 Highlights(1) Consolidated Brokerage Commissions
Brokerage trading value
Up 2.7%

Brokerage commissions
Down 2.6%(Trillion yen)

(Million yen)90

35,00031,69530,873

85.42

87.69

80

30,00070
25,00060
50

20,00040

15,00030
10,000

20
5,000

10

0

0

Fiscal 2007
(Apr.2006-Mar.2007)

Fiscal 2008
(Apr.2007-Mar.2008)

Fiscal 2007
(Apr.2006-Mar.2007)

Fiscal 2008
(Apr.2007-Mar.2008)

The numbers for SBI E*TRADE SECURITIES for FY08 are based solely on the Internet division.

<6>

(1) Brokerage commissions

Customer accounts at major online securities companies
Customer accounts at big five online securities
companies

Growth in customer accounts at big five online
securities companies(March 31, 2008)(April 2004 to March 2008)(# of accounts)(# of accounts) 1,662,051
57,056 Conventional accounts
1,600,000

1700000
1600000
1500000

1,400,000

1400000

1,604,995 Online accounts

With 256,154 accounts added
between April 2007 andMarch 2008, we continue toacquire more new accounts
than any other companies.

SBI E*TRADE
1,662,051

1300000

1,200,000

1200000

Monex
834,9311100000

1,000,000

1000000

779,787

800,000

Rakuten779,787

900000834,931800000729,394

Matsui
729,394

700000622,422600,000

600000500000Kabu.com
622,422400000400,000

300000200000200,000

100000SBIE*TRADE

Monex

RakutenMatsuiKabu.com

Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr

2004

2005
2005

2006
2006

2007
2007

2008

Source：Compiled by SBI E*TRADE SECURITIES based on Web sites #1. Monex is the sum of Nikko Beans and Monex. #2. Kabu.com merged with MeNet on
January 1, 2006. #3. SBI E*TRADE SECURITIES merged SBI Securities on October 1, 2007.
and other public information for each company.

<7>

(1) Brokerage commissions

New accounts at five major online securities companies(New accounts)

200,000

New customer accounts opened during April 2007 through March 2008

199,098
4Q (Jan-Mar.2008)
3Q (Oct-Dec.2007)
2Q (July-Sep.2007)
1Q (Apr-June 2007)

4Q

60,866150,000
3Q

45,372100,000

104,239
28,772

2Q

47,99350,0001Q

44,867

22,832

84,56722,16561,321

59,816

16,10013,797
10,727
17,117
18,175
Kabu.com

23,675

22,63828,96023,664

16,91013,323
14,91816,170

Rakuten

Monex

Matsui0

SBI
E*TRADE(Online accounts only)

Source：Compiled by SBI E*TRADE SECURITIES based on
Web sites and other public information of each company.

<8>

(1) Brokerage commissions

Change in SBI E*TRADE basis
Basis since 2Q of FY2006(Basis)July 1, 2005
Lowered commissions

6.0

June 1 to August 31, 2006
Commission reduction campaign

5.2
5.0
4.3

September 1, 2006

4.4

New commission
structure introduced

4.0
4.0
October 3, 2005
Loweredcommissions

3.0

3.1

3.2

3.0

2.8

2.9

2.9

3Q

4Q

2.7

2.0
2Q

3Q

FY2006

4Q

1Q

2Q

3Q

FY20074Q

1Q

2Q

FY2008# (Brokerage commissions ÷ Brokerage trading value) Calculated quarterly using non-consolidated figures. Brokerage commissions are from quarterly non-consolidated financial
statements. Starting from 3Q of FY08, numbers include only the Internet division (former SBI E*TRADE SECURITIES).

<9>(1) Brokerage commissions

Basis at major Japanese online securities companies
Basis for big five online securities companies(Brokerage commissions/Brokerage trading value)(Basis)

12.0

11.6

FY 2007
FY 2008

10.9

10.0

9.1

10.6

8.0
8.0

7.9
6.0
4.0

3.3

2.0

2.8

4.5
4.5

0.0
SBI E*TRADE

Kabu.com

Matsui

MBH

RakutenSource：Compiled by SBI E*TRADE SECURITIES based on financial statements, monthly releases and other public information.
Total for the period from April 2007 through March 2008. Brokerage commissions are from quarterly non-consolidated financial statements. The numbers for SBI E*TRADE
SECURITIES include only the Internet division (the former SBI E*TRADE SECURITIES).

<10>(1) Brokerage commissions

Brokerage trading value at major online securities companies(Index)Brokerage trading value at major online securities companies (Indexed)

120(Index with FY 2006 representing 100)

SBI E*TRADE
112.9

110
100
90

Rakuten 88.8

SBI E*TRADE
Matsui80

Kabu.com 81.5

Monex
Rakuten70

Kabu.com

Total for indivisuals 72.7

Total retail

60

Matsui 56.7
Monex 56.5

50

FY 2006

FY 2007

FY 2008(Apr.2005-Mar.2006)(Apr.2006-Mar.2007)(Apr.2007-Mar.2008)

Source：Compiled by SBI E*TRADE SECURITIES based on Web sites and other public information of each company, statistics byTokyo Stock Exchange, and statistics by JASDAQ. Figures for “Total retail” are the total of Tokyo, Nagoya, and Osaka exchanges (firstand second divisions), and JASDAQ. The numbers of SBI E*TRADE SECURITIES for FY08 are based solely on the Internet division.

<11>

(1) Brokerage commissions

Brokerage trading value at major online securities companies(Million yen)
600,000

Average daily brokerage trading value at big five online companies(April 2004-March 2008)
Daily average in March 2008
(million yen)

500,000

400,000

SBI E*TRADE
289,062
300,000

200,000

100,000

0
Jan

2004

Apr

Jul

Oct

Jan

2005

Apr

Jul

Oct

Jan

2006

Apr

Jul

Oct

Jan

2007

Apr

Jul

Oct

Jan

Rakuten108,476
Matsui55,632
Monex
53,933Kabu.com
43,4142008

Source：Compiled by SBI E*TRADE SECURITIES based on Web sites and other public information of each company. Monex is the sum of Nikko Beans and Monex.
Kabu.com merged with MeNet on January 1, 2006. The numbers for SBI E*TRADE SECURITIES are based solely on the Internet division.

<12>(1) Brokerage commissions

Comparison in brokerage trading value of Japan’s big three
Brokerage trading value at each company(Billion yen)

30,000Stock brokerage market share in 4Q FY08
25,00020,000SBI E*TRADE

SBI E*TRADE tops Nomura in 4Q FY05

18,990(8.5%)
15,000Nomura13,561(6.1%)

10,000Daiwa SMBC 7,588(3.4%)
Nikko Citigroup 6,441(2.9%)

5,000

Matsui 3,760(1.7%)
Daiwa 2,361(1.1%)
Nikko Cordial 903(0.4%)

0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q

FY 2002

FY 2003

FY 2004

FY 2005

Source：Complied by SBI E*TRADE based on data released by each company andTokyo Stock Exchange (SBI E*TRADE includes orders from overseas investors)

FY 2006

FY 2007

FY 2008(In billion yen. The percentages in parentheses are market shares, or<13>
brokerage trading value divided by the total of the three markets.)

(1) Brokerage commissions

Share of retail brokerage trading value at major online securities companies
Only SBI E*TRADE increased market share, reaching all-time highChanges in market share of retail stock brokerage trading value
FY 2006
FY 2007
FY 2008(April 2005-March 2006)

Others
42.6%

Big five online
securities
57.4%(April 2006-March 2007)

Others35.5%

Big five online
securities
64.5%(April 2007-March 2008)

Others30.7%

Big five online
securities

69.3%

SBI E*TRADE

23.1%

SBI E*TRADE

29.4%

SBI E*TRADE

35.9%

Rakuten

11.1

Rakuten

13.5

Rakuten

13.5

Matsui

10.0

Matsui

9.2

Matsui

7.8

Monex

8.0

Monex

6.5

Monex

6.2

Kabu.com

5.2

Kabu.com

5.9

Kabu.com

5.8

Source：Compiled by SBI E*TRADE SECURITIES based on Tokyo Stock Exchange
and JASDAQ materials and Web sites and other public information of each company.
*Retail stock brokerage trading value is the sum of Tokyo, Nagoya and Osaka
exchanges (first, and second divisions) and JASDAQ .

Kabu.com merged with MeNet on January 1, 2006.
The numbers for SBI E*TRADE SECURITIES are
based solely on the Internet division.

<14>

(1) Brokerage commissions

Share of retail brokerage trading value at major online securities companies
SBI E*TRADE’s market share surpassed the total of the other four for four quarters straight

Changes in market share in retail brokerage trading value

4Q FY2006

4Q FY2007

4Q FY 2008

(Jan.2006-March 2006)(Jan. 2007-March 2007 )(Jan.2008〜March 2008)

Others
40.4%

Big five online
securities
59.6%

Others35.9%

Big five online
securities
64.1%

Others
25.4%

Big five online
securities

74.6%

SBI E*TRADE

24.9%

SBI E*TRADE

29.9%

SBI E*TRADE

39.6%

Rakuten

12.0

Rakuten

13.1

Rakuten

14.6

Matsui

9.6

Matsui

8.5

Matsui

7.9

Monex

7.3

Monex

6.7

Monex

6.4

Kabu.com

5.7

Kabu.com

5.9

Kabu.com

6.0

Source：Compiled by SBI E*TRADE SECURITIES based on Tokyo Stock Exchange
and JASDAQ materials and Web sites and other public information of each company.
*Retail stock brokerage trading value is the sum of Tokyo, Nagoya and Osaka
exchanges (first, and second divisions) and JASDAQ .

Kabu.com merged with MeNet on January 1, 2006.
The numbers for SBI E*TRADE SECURITIES are
based solely on the Internet division.

<15>

(1) Brokerage commissions

Share of retail margin trading value at major online securities companies

FY 2006

Change in market share of retail margin
trading value
FY 2007
FY 2008(April 2005-March 2006)

Others30.4%

Big five online
securities 69.6%(April 2006-March 2007)

Others25.9%(April 2007-March 2008)
Others22.1%

Big five online
securities 74.1%

Big five
onlinesecurities
77.9%

SBI E*TRADE

27.5%

SBI E*TRADE

34.4%

SBI E*TRADE

40.5%

Matsui

14.4

Rakuten

14.9

Rakuten

15.6

Rakuten

12.6

Matsui

11.6

Matsui

9.0

Monex

8.4

Kabu.com

7.1

Monex

6.1

Kabu.com

6.7

Monex

6.3

Kabu.com

6.6

Source：Compiled by SBI E*TRADE SECURITIES based on Tokyo Stock Exchange
and JASDAQ materials and Web sites and other public information of each company.
*Retail margin trading value is the sum of Tokyo, Nagoya and Osaka exchanges (first,
and second divisions) and JASDAQ .

Kabu.com merged with MeNet on January 1, 2006.
The numbers for SBI E*TRADE SECURITIES are
based solely on the Internet division.

<16>

(1) Brokerage commissions(Reference) Assets in Customer Accounts(Billion yen)
4,500

Online accounts: ¥3,441.9 billion (Down16.6% YoY)
Conventional accounts: ¥313.0 billion

Down 9.0% YoY(‐¥371.3 billion )4,126

As of Mar. 31, 2007
4,000

3,754

As of Mar. 31, 2008

3,500
3,000

Down 17.7% YoY( -¥375.6 billion)

Down 26.6% YoY(-¥462.1 billion)

2,500
2,127
2,000

1,752

1,500

Down 14.1% YoY(-¥189.9 billion)
1,349
1,159

Down 18.0% YoY(-¥224.0 billion)
1,245

1,738
1,276

1,021

1,000
500
0
SBI E*TRADE

Monex

RakutenKabu.com

Matsui

Source：Compiled by SBI E*TRADE SECURITIES based on Web sites and other public information of each company.
SBI E*TRADE SECURITIES merged with SBI Securities on October 1, 2007.

<17>

(1) Brokerage commissions

Growth in futures and options transactions
The number of contracts increased 3.6-fold QoQ
Growth in futures and options accounts

Growth in futures and options commissions
450(# of accounts)

43,123(Million yen)

418
385

400

40,000

367

358

350

35,000322

302 315

30,000300

25,000250

20,000200

15,000150

10,000

100

5,000

315

311

279

50

0
Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan Apr Jul Oct Jan

2004

2005

2006

2007

2008

0
3Q

4Q

FY 2006

1Q

2Q

3Q

FY 2007

4Q

1Q

2Q

3Q

FY 2008

4Q<18>

(2) Consolidated financial revenues(Million yen)

21,743Financial revenues

20,00015,000Net financial revenues (revenues - expenses)

17,47013,396

Financial
revenues
Up 24.5%

16,471Net
Financial
revenues
Up 23.0%

10,0005,000

0FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)<19>

(2) Financial revenues

Margin accounts at major online securities companies
Comparison with Matsui Securities(March 2004 to March 2008)
SBI E*TRADE
169,443

Margin accounts at big five online companies(Margin accounts)(As of March 31, 2008)
180,000

169,443

Conventional accounts(Margin accounts)
175,000

1,098

160,000

Online accounts

150,000

168,345

140,000
120,000

125,000

101,034
100,000

Matsui
101,034

89,784
100,000

80,00058,75460,00075,00034,86340,00050,00020,0000
SBI
E*TRADE

MatsuiRakutenKabu.com

Monex

25,000Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar

2004

2005

2006

2007

Source：Compiled by SBI E*TRADE SECURITIES based on Web sites and other public information ofeach company. SBI E*TRADE SECURITIES merged with SBI Securities on October 1, 2007.

<20>

(2) Financial revenues

Margin trading balance(Billion yen)Margin trading balance (total of long and short positions) at month ends

600

Ordinary (no expiration)

500

567

570

93

83

519

519
492

69

Limited (long/short)

468

64

64

64

307
300

321

437
65

387

400

53

429
56

67

330
45

65
55

203
200

23

213
29

487

466
449

210
474

35

455

112

179
184

108

251

256

Mar05

Jun05

384

427

320
164
100

530

373

403

285

174

0
Sep- Dec03
03

Mar04

Jun04

Sep04

Dec04

Sep05

Dec- Mar- Jun- Sep- Dec05
06
06
06
06

Note:1. Data based on trade closing dates, non-consolidated for SBI E*TRADE SECURITIES
2. Starting December 2007, the data include the former SBI Securities conventional (face-to-face) transactions.

Mar07

Jun07

Sep- Dec07
07

Mar08

<21>

(2) Financial revenues

Growth in revenues from stock lending operations
Balance is low due to poor market conditions: Stock lending continues to be our focus, besides self-finance(Billion yen) Balance of shares loaned at month ends
80
74.2

Revenues from stock lending(Million yen)

350
321
306

70

300
57.5

60
53.7

54.5

54.7

256

246

209

48.4

50

275
249

250

52.8

51.3

280

192

200
40
33.0

150

136

30
22.6
20

100

50

10
2.1

4.2

0

25
8

0
Jun- Sep Dec Mar- Jun Sep Dec Mar- Jun Sep Dec Mar05
06
07
08

* Based on market value as of the end of each month.

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY 2008
FY 2006
FY 2007<22>

(3) Consolidated underwriting, offering and selling commissions(Million yen)

2,504

2,500

1,954

Up 28.1%

2,000

1,500
1,000

500
0

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)<23>

(3) Underwriting, offering and selling commissions

Measures to increase investment trust revenues produce successful results(Million yen)

4,000

Revenues from investment trusts

3,816

3,500
3,000
Up 130.2%

2,500
2,000

1,657

1,500
1,000
500
0

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)*1. Sum of selling commissions and trust fees (trust fees include MRF)
2. Trust fees are included in “ Other commissions received.”<24>

(3) Underwriting, offering and selling commissions

Investment trust sales and major new initiatives
Sales of investment trusts

Major initiatives(Billion yen)

200
200

187

180

120 funds are now available (April 2008)

160

Plan to expand this popular service by using dollar cost
averaging method, very low minimum initial investment,
and providing efficient way to make investments.

150

140
120

(2) Renewal of Website (Feb 2008)

95

100
100

80

(1) Regular purchase service formore investment trusts“E*TRADE CATEGORY” provides screening
service using our original classification method.

65

60

50

40
20
0
FY 2006

FY 2007

FY 2008*Includes MMF and medium-term gov't funds

Aim to offer even greater ease of use through further
improvements in our Website and provision of moresophisticated investment information.

<25>

(3) Underwriting, offering and selling commissions

Balance of investment trusts and trust fees
Larger lineup & merger with SBI Securities substantially increased balance /fee revenues(Billion yen)

300

Investment trusts

Investment trusts
Growth in quarterly assets(Million yen)

1,200

278 *
250

Growth in trust fees

1,118

1,100
1,000

*Including 86.1 billion inconventional accounts

900

784
800

200

700
600

150

508

500

210

100

109

50

120

191

400

296
300

140

161

200

71

100

0

75

0

Sep

Mar

FY 2006

Sep
FY 2007

Mar

Sep

Mar

FY 2008*Note: Includes MMF, medium -term gov't funds, and conventional accounts.

1-2Q

3-4Q

FY 2006

1-2Q

3-4Q

FY 2007

1-2Q

3-4Q

FY 2008

Note: Includes MMF, MRF, medium -term gov't funds, and conventional
accounts. Trust fees are included in ”Other commissions received.”<26>

(3) Underwriting, offering and selling commissions

IPO underwriting (1)IPO issues underwritten by

IPO issues and amounts underwritten by(Companies) SBI E*TRADE SECURITIES

major online securities companies in FY 2008
(Companies)
58
60
4,817

121
120

(Million yen)
5,000
Offerings underwritten

55
100

94
87

80

45

4,000

40

3,500

34

35

58

60

38

40

42

38

4,500

Amounts

50

3,000

30

2,500

2,062

25

2,000

18

20

23
20

9

10

8

5

0

1,500

15

699

500

90

0

0
FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08

1,000

SBI E*TRADE

Monex

MatsuiRakuten* Includes over -allotments. Excludes agency transactions. Based on stock listing date. Excludes brokerage sales/real estate investment trusts.

＜IPO markets: newly listed companies＞FY 2007: 187 companies

FY 2008: 99 companies<27>

(3) Underwriting, offering and selling commissions

IPO underwriting (2)(Companies)

Cumulative IPOs underwritten

IPO underwriting ranking

by big four online securities firms(April 2007-March 2008)509

Top among all securities firms

500

Rank

Securities firms

NumberParticipation
ratio

1

SBI E*TRADE
SECURITIES

58

58.6%

1

Mitsubishi UFJ

58

58.6%

3

Daiwa SMBC

54

54.5%

4

Nomura

53

53.5%

5

Shinko

52

52.5%

6

Mizuho Investors

40

40.4%

7

Nikko Citigroup

36

36.4%

382

400

300

233

220

200

100

0
SBI E*TRADE

Monex

MatsuiRakutenSource: Compiled by SBI E*TRADE SECURITIES based on public information.
The data covers period from start of online business of each company to March
31, 2008 (Listing date base). Excludes brokerage sales and real estate
investment trust

Note: Compiled by E*TRADE SECURITIES based on public information.
Covers underwriting for 99 companies from April 2007 through March 2008 in
Japan (listing date base). Excludes secondary offerings.

<28>

(4) Consolidated trading gain and other revenues(Million yen)

10,000

Other commissions received + trading gain + other operating
revenues + 401K-related sales

9,378

8,000

6,291

Up 49.1%

6,000
4,000
2,000
0

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)<29>

(4) Trading profits and other revenues

Bond Sales
Bond sales (government/corporate/foreign) Increased efforts for foreign bonds
20(Billion yen)

19.5
Effective use of conventional channel

18

Foreign Bond

7.0

16

14

Yen Bond

15.5

13.6

12

10.3
10

9.0

8.6

After the merger, new initiatives wereintroduced including seminars at branch
offices and other high-profile marketing
activities
Record sales of South African Rand bonds

12.7

Record sales of 8.9 billion yen in 4Q FY2008

8

12.5

6

6.5

8.0

Yen bonds linked to Brazilian real started

4

2

4.9
2.4

2.3

2.7

2Q-08

3Q-08

4Q-08

Started selling Japan’s first bonds linked to theexchange rate of Brazilian real.

0

4Q-07

1Q-08

* Earnings from government bonds for individuals include commissions from underwriting and secondary offering. The above figures include brokerage trading.

<30>

(4) Trading profits and other revenues

Growth in foreign exchange margin trading
Revenues stabilized after reduction in commissions in June 2007
Foreign exchange margin trading accounts

97,848(Accounts)

100,000
90,000

Revenues from foreign exchange margin trading
700(Million yen)

634
600

538 52380,000500

70,000454
413

60,000400

335

50,000

449

432
356

375

374

300
40,00030,000200

192

20,000100
10,000

0

0
Apr

2004

Oct

Apr

2005

Oct

Apr

2006

Oct

Apr

2007

Oct

Mar

2008

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q
FY 2006

FY 2007

FY 2008<31>

(5) Consolidated selling, general and administrative expenses
36

35.1 (2.7)(Billion yen)

33
30

Trading expenses
Exchange memberships,
advertising, etc.

9.9 (0.2)

28.7

27
24

Personnel expenses

8.8

Occupancy expenses
Leases for on-line securities
systems, rents, etc.

5.1(1.5)

21
18
15

3.2
5.3

12
9

Goodwill amortization

6.7 (0.5)
0.1
0.0

1.8 (0.0)

1.4
7.0 (0.3)

6

6.7

3

0.4
2.6

3.7 (0.0)

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)

00.4 (0.0)

Depreciation expenses
For software, etc.
Administrative expenses
IT systems, back office fees, etc.
Taxes
Others, allowance for
doubtful accounts
Cost of information* Figures in parentheses are estimated SG&A expenses for conventional securities operations (former SBI Securities) based on the past records.

<32>

(6)-① E*TRADE Korea performance for FY2008＜Converted to yen＞

(Million yen,%)

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)

Operating revenues

5,780

8,914

+54.2

Net operating
revenues

5,446

8,120

+49.1

Operating income

1,474

3,170

+115.1

Ordinary income

1,482

3,179

+114.5

Net income

1,048

2,225

+112.3

YoY change(The figures are the total of monthly figures, which have been converted from won into yen using monthly average exchange rates.)<33>

(6)-① E*TRADE Korea performance for FY2008＜Korean won based＞(Million won,%)

FY 2007

FY 2008(April 2006-March 2007)(April 2007-March 2008)

Operating revenues

46,447

72,136+55.3

Net operating
revenues

43,76265,724+50.2

Operating income

11,836

25,668+116.9Ordinary income

11,90025,745+116.3

Net income

8,421

18,058+114.4

YoY change<34>

(6)-② Financial highlights of IT system subsidiaries
TradeWin Co., Ltd.

Traders Financial Systems Co., Ltd.
*Name changed to SBI Tech Co., Ltd scheduled on April 1, 2008

(Million yen)

(Million yen)
FY 2008(April 2007-March 2008)

FY 2008(April 2007-March 2008)

Operating revenues

1,251

Operating revenues

868

Net operating
revenues

457

Net operating
revenues

209

Operating income

263

Operating income-25

Ordinary income

271

Ordinary income-29

Net income151

Net income

-6
<35>

２. Major Initiatives in Fiscal 2008

2. Major FY 2008 initiatives

Major FY2008 initiatives
Month・Indicates service release, *Indicates alliance, decision, etc.

Description of action

April•Started HYPER E*TRADE reverse limit order service•Started instant settlement service through alliance with Seven Bank•Started promoting the SBI Holdings SNS E*TRA Long-life Village (now SBI Money World) to customers withsecurities accounts

May•Introduced S! application-compatible HYPER MOBILE service for cell phone users•Fee reduction to industry’s lowest level for eight products in ”Biggest Campaign of All Time ”•Started MOBILE E*TRADE for W-ZERO3 service for WILLCOM W-ZERO3 series•Started “Investment Trust Double Smile Campaign”

June•Cut official commissions for E*TRADE FX foreign exchange margin trading•Lowered interest rates on long margin positions with no maturity (ordinary margin trades)•Conducted “Thank You Campaign for Biggest Campaign of All Time ”•Started promoting 401k accounts for individuals at the Everyone’s Money Site of Seven Bank•Started handling overseas exchange-traded funds

July• Through alliance with Winterthur Swiss Life Insurance, started handling investment-type annuity insurance
through Internet applications*TradeWin and Traders Financial Systems became wholly owned subsidiaries through exchange of stockAug.

•Significantly eased requirements for free use of HYPER E*TRADE Ver2.0•Began accepting requests to use E*TRADE points as contributions to victims of the earthquake in Niigata•Started nighttime trading service (started link with Japannext PTS)•Started a campaign that cut mini-Nikkei 225 futures commissions to the industry’s lowest level

Sep.

•Started bank agent service for Sumishin SBI Net Bank•Started offering FLASH version of application form to open an account<37>

2. Major FY 2008 initiatives

Major FY2008 initiatives

Description of action

Month
Oct.
Nov.

・Indicates service release, * Indicates alliance, decision, etc.

*Merged with SBI Securities• Foreign stock trading – “W Campaign” for new accounts• Foreign stock trading – Christmas campaign• Mini-Nikkei 225 Futures ¥52.5 & Large ¥315 Campaign*Announcement of company name change and end of licensing contracts

Dec.

• “Happy Bonus Campaign” to commemorate expansion of investment trust periodic purchase service• Started Japanese Stock Dial Ordering Service• Allowed customers to use E*TRADE Points for charitable donations*SBI Group and Softbank Mobile agreed to jointly develop and sell a cell phone designed exclusively to stock trading
・Reduced official commissions for mini-Nikkei 225 futures

Jan.

*Reached agreement in principle to make SBI E*TRADEJAPAN a wholly owned subsidiary of SBI Holdings

Feb.

• Expansion and move of call centers• Major renewal made on the “Investment Trusts” information Website

March• Launched ”SoftBank 920SH YK” (sold from Softbank Mobile), a cell phone specialized in stock trading• Website renewal• PTS night trading services extended session hours, started acce pting trading from HYPER E*TRADE and HYPER
MOBILE-loaded cell phones<38>

３. New Initiatives
Business restructuring for further growthBusiness restructuring for further growth

1. Merger with SBI Securities (October 1, 2007)
2. Stock transfer of two IT system subsidiaries(April 1, 2008)
3. Agreements reached on stock transfer of
E*TRADE Korea Co., Ltd. (April 10, 2008)
4. Name change to SBI Securities Co., Ltd.
(Scheduled for July 1, 2008)
5. To become a wholly owned subsidiary of SBI
Holdings (Scheduled for August 1, 2008)<40>

Changes in business environment in Japan

Trading by foreign investors in Japanese markets
Foreign investors’ trading volume in the three markets (both 1st & 2 nd divisions) and Nikkei 225(April 2007-March 2008)

2,000(Trading value: Billion yen)

1,453
1,500

(Nikkei 225: Yen)

1,289

1,000

19,00018,0001,145

813

17,000504
16,000500-0.6

15,000

0

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

-500
-494
-1,000

Dec

Jan

Feb

Mar

14,000-337-594

13,000-725
12,000-1,033-1,500-1,29811,000Foreign investors were net buyers at first and then became net sellers for five straightmonths (Nov.07-March 08)

Source：Complied by SBI E*TRADE using statistics announced by Tokyo Stock Exchange and other organizations.

<41>

Changes in business environment in JapanA different business environment for the financial sector
Enforcement of the
Financial instruments
and exchange law
Major changes in sales and marketing
activities to adjust to customer
characteristics.

More stringent criteria forstock listing
Poor IPO business environment due tofewer public offerings

Flexible and responsive management
structures are needed in order to adapt
quickly to the changing businessenvironment
Needs for even moresophisticated IT systems
Increased needs for building
more efficient and stable IT
systems with as few risks as
possible.

Uncertain outlook forJapanese economy
Amid deteriorating businessenvironment, companies are now
less interested in fundprocurement and M&A activities<42>

Changes in business environment in Japan

Business environment for online securities companies
Online securities industry has reached a stable phase; rapid growth will be difficult
New accounts at big five online firms(Accounts)

Share of retail brokerage trading value(Jan.2008-March 2008)

2,000,000

1,693,425
1,500,000

Others60.4%

1,000,000

717,400

604,396

509,041

500,000

0

FY
2005

SBI E*TRADE
SECURITIES
39.6%

FY
2006

FY
2007

FY
2008

* The big five includes SBI E*TRADE SECURITIES, Kabu.com, Matsui, Monex, and Rakuten.
Compiled by SBI E*TRADE based on the Website and other publicly available information. For
SBI E*TRADE, only online accounts are counted.

SBI E*TRADE now accounts fornearly 40% of the total retail trading
value. Expansion into new businessfields is vital to grow further.
Source：Compiled by SBI E*TRADE SECURITIES based on Tokyo Stock Exchange andJASDAQ materials, and Web sites and other public information of each company.
*Retail brokerage trading value is the sum of Tokyo, Nagoya and Osaka exchanges (first,
and second divisions) and JASDAQ . *The numbers for SBI E*TRADE SECURITIES are<43>
based solely on the Internet division.

Actions to take to expand business activities

1. Build on the company’s position as a core memberof the SBI Group financial conglomerate
2. Strengthen retail operations by channeling moreresources to this business
3. Expand wholesale business by utilizing resourcesof SBI Group
4. Build reliable and stable IT systems
5. Review our global strategies<44>

1. Build on the company’s position as a core member of SBI Group financial conglomerate
Take advantage of full services of SBI Group, including banking, brokerage, and insurance
Seek to increase synergy within SBI Group by changing company name andbecoming wholly-owned subsidiary

Providing PTS night
trading session(planning to expand
into daytime trading)

Sweep accounts<Only for online trading>Investment information* The new name starting on July 1, 2008

More and better
retail products(insurance)
More and better
retail products

Providing common Point
Program to SBI GroupOne-stop convenience by providing financial products/services besides securities brokerage* Approval by shareholders meeting, scheduled to be held in June, is the prerequisite for name change and subsidiary status.

<45>

2. Strengthen retail operations by channeling more resources to this businessTo create “Japan’s first ideal securities company for individual investors”
Utilize call centers and branches to complement/strengthen online trading

The Internet
Lowest commission rates
Highest standards of service
1.6 million
accounts

Call center
Call centers for consulting
Providing investment advice

Complement/
Strengthen

Branch offices
Wholesale
Retail• Money Plaza• Seminars• Private banking

Aim to establish a new business model where Internet and real world<46>
merge with the aim of expanding businesses further

2. Strengthen retail operations by channeling more resources to this business

Goals for branch office operations
Develop multiple services integrating the Internet, branches, Money Plaza, and call centers【Present】
27 branches
nationwide with
265 sales
representatives【Future】

Core branch offices
Positioned nationwide as acenter for private banking
Close tie-up with small offices

Small offices＜Money Plaza ＞
●
●

●

●●
●

●
●

●

Aggressive expansion into major
cities, as venues for seminars andfinancial advice services

Consulting
call center

●●
●● ●
●
●
●
●
●
●
●
●
●
●
●

To provide investment consulting for the
online customers who ask for consulting
and customers of conventional
operations (face-to-face) who do not likesolicitation.
Plan to start trial services for customers in Kumagaya, Ashikaga, and Kawagoe<47>

2. Strengthen retail operations by channeling more resources to this business

Provide value added services
Enhance convenience of the online trading<Planned services>① Call center for consulting service
Provides additional services for customers who want investment consulting② HYPER E*TRADE to offer futures options, FX (foreign exchange
margin trading)
Improving functions of HYPER E*TRADE will provide full services from information search to orders for
futures options and foreign exchange margin trade③ Stock lending service for online customers
Stock lending services for retail customers to facilitate efficient management of funds, leading to moreconvenience④ Greater variety of foreign stocks to increase investment opportunities
With a view to provide new investment opportunities, it continues its efforts to increase variety offoreign stocks. Preparation under way to handle Russian stocks⑤ Ordinary margin trading to be offered at PTS nighttime trading
Aim to provide more convenient night time trading services by improving liquidity at PTS markets<48>

3. Expand wholesale business by utilizing resources of SBI Group

Targeted markets for investment banking
Focus resources on Middle Market to promote investment banking

Listed companies
Market capitalization¥50 billion or more
Listed companies

Middle Market

Market capitalization less than ¥50
billionNon -listed companies
Several thousands ofcompanies approached

Foreign investment
banks
Japanesefinancial
institutions*The new namestarting on July 1,
2008

We have a broad customer base comprising unlisted companies where we provided
IPO support, and about 500 companies for whom we worked as a syndicate member. <49>

3. Expand wholesale business by utilizing resources of SBI Group

Take advantage of resources of SBI group for investment banking
Create a unique investment banking business made possible by ourability to utilize SBI Group resources＜Needs of customers＞

Syndicate member for 509 companies
Several thousand unlisted companies approached

M&A
Capital/business tie-up

MBO, LBO
Business succession

Finance

Holding company
Buyout, corporate
rehabilitation* The new name after July 1 2008

Venture capital
Mezzanine/DIP finance(DIP=Debtor in Possession)

To provide solutions that meet customer needs, other functions can be provided by SBI Group
Expand business as an intermediary for corporations through extensive use ofexisting customer base and SBI Group resources<50>

3. Expand wholesale business by utilizing resources of SBI Group

Function as a hub that links SBI Group companies and customer companies

Use SBI Group resources for deal sourcing
4 M&A brokerage deals, 2 deals as TOB agent in FY08
【Example】
M&A brokerage＋TOB agent
SBI Holdings acquired shares of
Living Corporation

Take-over bid period : August 1-September 3, 2007

M&A brokerage
SBI Capital acquired shares of VSN

Acquisition date : March 7, 2008

Help increase revenue opportunities for the whole group by serving
as an intermediary for SBI Group companies<51>

4. Build reliable, stable IT systems

Stock transfer of IT system subsidiaries
Improve system integrity of the whole group to improve stability and efficiency
Shares of Traders Financial Systems Co., Ltd and TradeWin Co., Ltd., both consolidated
subsidiaries, will be transferred to C 4 Technology Inc., which will be the core of SBIGroup’s IT system ecosystem.** C 4 Technology Inc. plans to change its name to SBI Net Systems in June 2008.

Current

Commission

Traders Financial Systems Co., Ltd.
TradeWin Co., Ltd.

Future(After becoming
wholly owned
subsidiary)* The new name starting July 1 2008

Commission

SystemEcosystem

Commission(SBI Net Systems, etc.)

Increase unity as SBI Group and pursue efficient business operation<52>

5. Review global strategies

Basic agreements reached on stock transfer of Ｅ*TRADE Korea Co., Ltd.
Share prices of E*TRADE Korea since listing(Korean won)
28,000<Background for sale>

Sale price: 22,000 won per share

・Increased competition and reduced
expectations for growth in Korean online
stock trading

24,00020,000・Review of overseas strategies due totermination of licensing agreement with US
E*TRADE in July 2008

16,000・Despite big contributions to consolidated
revenues, only business involving SBIGroup is cross-boarder transactions

12,0008,000

2007/2/21(listed)

2007/11

Offering price: 6,500 won per share

2008/4・Thanks to strong Korean markets, shareprice of E*TRADE Korea Co.,Ltd stay highWe decided that, instead of using company resources for ETRADE Korea, the best
strategy is to sell this stock and make efficient use of the capital gain. Business tie-up
with E*TRADE Korea will continue in cross-boarder transactions.
(Extraordinary income of about 17.4 billion yen ( non-consolidated) to be posted in FY 2009)<53>

5. Review global strategies

Future global strategies
Termination of license agreement with E*TRADE FINANCIAL enables overseas expansion

Expansion of overseas corporate business made possible
through acquisitions/tie-ups with local securities companies
Needs for public
offerings in
Singapore market

1.

Review our overseas strategies,
especially concerning Asia, which has
excellent growth prospects, tooptimize management resources2.

Make best use of existing networks
and know-how to support Japanesecompanies that seek listings on local
stock exchanges.

Needs forpublicofferings inHong Kong
marketConsider ways to expand operations
more efficiently by pursuing synergy
with overseas growth of SBI Group.

Tie-upsecurities
companies

Tie-upsecurities
companies<54>

４. Dividends

4. Dividends

Proposal for FY08 year-end dividend
SBI E*TRADE SECURITIES has announced its intention of paying a FY08 year-end
dividend of ¥1,700 per share. Compared to the ordinary dividend of ¥1,600 andcommemorative dividend of ¥100 in the previous year, the current dividend stays thesame as in FY07.

Year ended March 31 2008

Year ended March 31 2007

Per share

Per share

Ordinary dividend¥1,700¥1,600E*TRADE Korea
Commemorative
dividend

-

¥100

Total

¥1,700¥1,700<56>

http://www.etrade.ne.jp

Risks and commissions associated with products handled by SBI E*TRADEName

SBI E*TRADE SECURITIES, Financial Products Trader

Registration number

Kanto Regional Finance Bureau (Kinsho) No. 44

Memberships

Japan Securities Dealers Association, The Financial Futures
Association of Japan

Risk information concerning products
u Japanese stocks: Ordinary trading• Stock transactions may result in losses due to changes in stock prices and other factors.

u Japanese stocks: Margin trading• Margin trades require a deposit of at least 33% of the transaction value, but not less than ¥300,000.
• Since margin trading permits using small deposits to conduct large transactions, there is a risk of
incurring a substantial loss.
• Margin trading may produce losses due to changes in applicable stock prices and other factors. In
addition, losses may exceed the margin deposit.

u Odd-lot shares• Stock transactions may result in losses due to changes in stock prices and other factors.

u Off-market sales• Stock transactions may result in losses due to changes in stock prices and other factors.
<58>

Risks and commissions associated with products handled by SBI E*TRADE
Risk information concerning products
u IPO/Public offerings/Secondary offerings• Stock transactions may result in losses due to changes in stock prices and other factors.

u Investment trusts• Investment trusts purchase mainly stocks, corporate and government bonds and other securities
with price volatility. Since the principal is not guaranteed, the price of each investment unit willfluctuate along with changes in market prices, exchange rates and other factors on markets
associated with trust assets. Consequently, the value of an investment trust investment may fall
below a customer’s initial investment.
• Investment trusts differ depending on the type of assets held, investment limits, markets andcountries used for investments, and other factors. Since each trust has a different risk profile ,investors are urged to read the prospectus and contract before signing.

u Bonds• Bond prices move together with changes in market interest rates. Consequently, investors may
incur losses when selling a bond prior to its maturity.
• Foreign government bonds may produce losses due to changes in foreign exchange rates andother factors.

u Futures/Options• The required deposit is (SBI E*TRADE SPAN deposit − Net option value x 1.2 (120%).
• The SBI E*TRADE SPAN deposit and total net option value is recalculated each time an order isplaced or completed. Furthermore, the deposit may change due to exchange regulations or adecision by SBI E*TRADE at its discretion<59>

Risks and commissions associated with products handled by SBI E*TRADE
Risk information concerning products
u Futures/Options (continued)• Please confirm the current SPAN deposit by visiting the Osaka Securities Exchange Web site.
• Prices of stock index futures (Nikkei 225 and mini Nikkei 225) fluctuate along with changes in stockindexes and other items. This volatility may result in losses for investors. If market prices move in the
opposite direction than was expected, investors may lose a large part or all of the deposit in a short time.
Furthermore, this loss may exceed the deposit. Moreover, since stock price index futures trading permits
using small deposits to conduct large transactions, there is a risk of incurring a substantial loss.
• Prices of stock index options (Nikkei 225 options) fluctuate along with changes in stock indexes and otheritems. This volatility may result in losses for investors. Caution is needed because options can be
exercised only during a certain period. Investors who buy options will lose their entire investments if theoption is not exercised or resold before the expiration date. Investors who sell options may be exposed toan unlimited loss if market prices move in the opposite direction than expected. Furthermore, since stockindex option market prices are linked to movements in the actual stock index, volatility of option prices
may be higher than the rate of change in the actual stock index. In some cases, there is a risk of incurringa substantial loss.

u Foreign stocks• Foreign stock transactions may result in losses due to changes in stock prices and other factors.
• Foreign stock transactions may result in losses due to changes in foreign exchange rates and other items.

<60>

Risks and commissions associated with products handled by SBI E*TRADE
Risk information concerning products
uForeign exchange margin transactions (E*TRADE FX)• Foreign exchange margin transactions are conducted in units of 10,000 to 10 million currency units and require aminimum deposit of from ¥50,000 to ¥200,000.
• Principal and interest for these transactions are not guaranteed.
• These transactions are conducted using a small deposit in relation to the amount of the trade. Consequently,
while investors may earn large profits in relation to the deposit, there is also a risk of incurring a large loss withina short time.
• These transactions may result in losses due to changes in currency prices, financial indicators and other items.
Furthermore, losses may exceed the deposit.
• The swap point varies depending on changes in interest rates and other items. Consequently, there is no
guarantee that the swap point will remain the same.
• Transaction rates use the 2-way method, resulting in a difference between the purchase and sale value.

uIndividual annuities• Investments used by individual annuity plans include investment trusts. Since the value of investment trust
investments changes depending on changes in prices of trust stocks and bonds, exchange rates and other items,
the value of an investment may fall below the principal.

uInsurance• Insurance policy assets are managed in a separate account while premiums are received and while annuity
payments are made. Death benefits, annuity payments and refunds upon policy termination may increase or
decrease depending on the performance of assets in the special account. Assets in the special account arevulnerable to investment risks associated with changes in prices of stocks and corporate and government bonds,
exchange rates, and other items. Depending on the performance of assets, the sum of annuity payments and therefund upon termination may fall below the one-time insurance premium payment. The policyholder is
responsible for all of the risk.
<61>

Risks and commissions associated with products handled by SBI E*TRADE
Risk information concerning products
u e-warrants• Prices of e-warrants (covered warrants) are vulnerable to many factors that include but are not limited tochanges in prices of underlying stocks and stock indexes, REITs, depositary receipts, JGB futures,
currencies (link bonds), commodities (link bonds), to the passage of time (in general, the price declines withtime, except for certain types of issues), and to foreign exchange rates (for underlying assets are outside
Japan). Consequently, principal is not guaranteed and there is a high risk of losing the entire original
investment. Furthermore, e-warrants generally have greater price volatility than a direct investment in theunderlying assets. (However, when the price of an e-warrant is extremely low, price movements are virtually
unaffected by changes in prices of underlying assets.)• Prices of near-pin e-warrants (covered warrants) are vulnerable to many factors that include but are notlimited to changes in stock indexes and foreign exchange rates, which are the underlying assets, and thepassage of time (including during a single day). Consequently, principal is not guaranteed and there is ahigh risk of losing the entire original investment. Furthermore, near-pin e-warrants generally have greater
price volatility than a direct investment in the underlying assets. The maximum amount that can be received
per warrant is ¥100. If the price of the applicable assets upon maturity differs from the pin price by morethan the prescribed amount, the price will be zero upon maturity. Even if an investor purchases all types ofnear-pin e-warrants that have the same maturity date, there is a possibility of losing the entire investment.
• Tracker e-warrants (covered warrants) are securities where prices are vulnerable to many factors, includingchanges in the prices of the underlying assets such as stock indexes, currencies (linked bonds) andcommodities (linked bonds), foreign exchange markets (if the underlying assets are in another country), andother items. Consequently, principal is not guaranteed and investors may incur losses. Prices of tracker ewarrants generally move more closely with the prices of the underlying assets than the prices of e-warrants
do. However, these prices are not linked with prices of the underlying assets during any particular period.
Furthermore, there may be a change in the assumption for the investment return for the underlying assets
because of changes in interest rates, projected dividends until maturity, stock lending associated with theunderlying assets, and other items. In this case, there may be an effect on the price of the tracker e-warrants.
Please refer to the latest foreign securities manual for more information.
• Furthermore, a transaction may be terminated even during exchange trading hours.
• There is a difference (spread) between customers’ purchase and sales prices.
<62>

Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (Internet/mobile/IVR transaction fees and taxes)
u Japanese stocks, ETF, REIT, Securities investment companies• For ordinary trades, the commission per order is ¥200 for trades up to ¥100,000, ¥250 up to ¥200,000,¥450 up to ¥500,000, ¥800 up to ¥1 million, ¥950 up to ¥1.5 million, ¥1500 up to ¥30 million and ¥1575 formore than ¥30 million. (standard plan) The commission for trades in a single day is nothing for up to¥100,000, ¥250 up to ¥200,000, ¥315 up to ¥300,000, ¥500 up to ¥500,000, ¥900 up to ¥1 million, and an
additional ¥420 for each additional ¥1 million. (active plan *1) For system/ordinary (unrestricted) margintrades, the commission per order is ¥150 for trades up to ¥200,000, ¥200 up to ¥500,000 and ¥400 for
more than ¥500,000. (standard plan) The commission for trades in a single day is nothing for up to¥100,000, ¥300 up to ¥500,000, ¥600 up to ¥1 million, ¥1000 up to ¥10 million, ¥2000 up to ¥50 million, andan additional ¥2000 for each additional ¥50 million. (active plan *)• For PTS nighttime trades, the commission per order is ¥450 for trades up to ¥500,000, ¥800 up to ¥1
million, ¥950 up to ¥1.5 million, ¥1500 up to ¥30 million, and ¥1575 for more than ¥30 million (butcommission is ¥367 for all trades executed from August 27, 2007 to July 31, 2008).
• The commission for odd-lot shares (S stock) transactions is 0.63% of the transaction value. There is no
minimum commission.
• There is no commission for IPOs , public offerings and secondary offerings.
• There is no commission for off-market sales.
* The total transaction value and commission are calculated separately for ordinary Japanese stocktransactions, Japanese stock system margin transactions, and Japanese stock ordinary margintransactions. In addition, the standard plan commissions will be applied for transactions by call centercustomers using the IVR system.
<63>

Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (Internet/mobile/IVR transaction fees and taxes)
u Foreign stocks• For U.S. stocks, the commission per order is US$26.25 up to 1,000 shares and an additional 2.1
cents for each additional share.
• For Chinese stocks, the commission is 0.4095% of the transaction value. The minimum
commission is HK$31.50 (with tax) and the maximum commission is HK$315 (with tax).
• For Korean stocks, the commission is 0.945% of the transaction value. The minimum commissionis 9,450 won (with tax).
* There is a management fee of up to 0.99% on overseas ETFs.

u Investment trusts• For stock and other investment trusts, the application fee is a maximum of 3.15% of the unit price (withtax), the trust fee is a maximum of 2.7125% of the net assets (with tax), and the trust asset retention
amount is a maximum of 1% (not taxed) of the unit price upon redemption. Please check for other fees in
the prospectus of each fund. Investment trust fees are different for each fund.
• When investing in a foreign currency-denominated MMF (U.S. dollars), investors pay only the amount of
the investment. There is also a one-way foreign exchange fee of ¥0.25 for the foreign exchangetransaction associated with the purchase of the foreign currency-denominated MMF.

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Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (Internet/mobile/IVR transaction fees and taxes)u Bonds• Japanese bonds (except convertible bonds): Investors pay only the value of the bonds when buying
Japanese bonds.
• Foreign bonds: Investors pay only the value of the bonds when buying foreign bonds. Please note that
there is also an SBI E*TRADE foreign exchange fee associated with the purchase of the foreign bond(payable for each purchase). This fee is ±¥0.50 for the U.S. dollar, ±¥0.80 for the euro, ±¥0.80 for the
Canadian dollar, ±¥1 for the Australian and New Zealand dollars, ±¥0.50 for the South African rand, and±¥0.30 for the Mexican peso.
* Please note that these foreign exchange fees may be revised at any time without prior notice.

u Financial products• For foreign exchange margin transactions(*), the commission is ¥300 for each trading unit and ¥4500 for
15 or more trading units.
• For futures transactions, the commission is ¥525 per Nikkei 225 contract and ¥52.5(with tax, rounded
down to the nearest whole yen) per mini Nikkei 225 contract.
• For options transactions, the commission is 0.21%(with tax), and the minimum commission is ¥210 (withtax).
• e-warrant commissions are ¥262 (with tax) for trades up to ¥200,000 and ¥525 (with tax) for trades of¥200,000 or more.
• There is no commission for individual annuity transactions.
• For insurance policies, there is no commission for investment-type annuity policies, healthcare insurance,cancer insurance, automobile insurance, overseas travel insurance and golf insurance. However, forinvestment-type annuity policies, there is a fee of 5.0% of the lump-sum premium payment to cover initial
policy expenses, a monthly fee of ¥500 for policy management expenses and other insurance
administrative expenses. Please visit the SBI E*TRADE Web site to obtain more information.
* When there are investments in two or more items, commissions will be calculated for each investment.
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Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (*Transaction fees including taxes at conventional offices)u Commissions for Japanese stocks, ETF, REIT, beneficiary certificates of securities investmentcompanies, etc., and preferred stock, etc.
• For ordinary trades, the commission per order is 1.2075% (*1) of the transaction value for trades up to ¥1
million, 0.945% + ¥2,625 for trades of ¥1 million+ to ¥5 million, 0.735% + ¥13,125 for trades of ¥5 million+ to¥10 million, 0.60375% + ¥26,250 for trades of ¥10 million+ to ¥30 million, 0.39375% + ¥89,250 for trades of ¥30
million+ to ¥50 million, ¥286,125 for trades of ¥50 million+ to ¥100 million, 0.0735% + ¥212,625 for trades of¥100 million+ to ¥200 million, 0.0525% + ¥254,625 for trades of ¥200 million+ to ¥300 million, 0.042% +¥286,125 for trades of ¥300 million+ to ¥500 million and 0.0315% +¥338,625 for trades of more than ¥ 500
million. (with tax)
*1. However, the commission is ¥2,650 if the above commission of 1.2075% of the transaction value is less than
¥2,625.
* More information concerning commissions is available at any SBI E*TRADE office.

u Odd-lot stock brokerage commissions• The brokerage commission for trades of shares of less than one tangen (trading unit) is the proportion of
the commission for one tangen based on the number of odd-lot shares.

u Foreign stock (U.S. and China) brokerage commissions• For foreign stock trades, the commission per order is 10.5% (with tax) of the transaction value for trades up
to ¥75,000, ¥7,875 (with tax) for trades of ¥75,000+ to ¥750,000, 1.05% (with tax) of the transaction value fortrades of ¥750,000+ to ¥5 million, 0.84% + ¥10,500 (with tax) for trades of ¥5 million+ to ¥10 million, 0.63% +¥31,500 (with tax) for trades of ¥10 million+ to ¥50 million, 0.42% + ¥147,000 (with tax) for trades of ¥50
million+ to ¥100 million, and 0.21% + ¥346,500 (with tax) for trades of more than ¥100 million.

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Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (*Transaction fees including taxes at conventional offices)u Foreign stock (U.S. and China) brokerage commissions (continued)*

For purchases, foreign securities exchange brokerage commissions, securities transaction
taxes and other fees will be added to the overseas amount due for the purpose of calculating
the transaction value. For sales, these commissions, taxes and fees will be deducted fromthe amount due.

*

The foreign exchange rate used by SBI E*TRADE for foreign stock transactions will be the
TTS rate for purchases and the TTB rate for sales.

u Stock index futures brokerage commissions• For stock index futures trades, the commission per order is 0.084% (with tax) of thetransaction value for trades up to ¥100 million, 0.063% + ¥21,000 (with tax) for trades of¥100 million+ to ¥300 million, 0.042% + ¥84,000 (with tax) of the transaction value fortrades of ¥300 million+ to ¥500 million, 0.021% + ¥189,000 (with tax) for trades of ¥500
million+ to ¥1 billion, and 0.0105% + ¥294,000 (with tax) for trades of more than ¥1 billion.

u Stock index options brokerage commissions• For stock index options trades, the commission per order is 4.2% (with tax)*1 of thetransaction value for trades up to ¥1 million, 3.15% + ¥10,500 (with tax) for trades of ¥1
million+ to ¥3 million, 2.1% + ¥42,000 (with tax) of the transaction value for trades of ¥3
million+ to ¥5 million, 1.575% + ¥68,250 (with tax) for trades of ¥5 million+ to ¥10 million,
1.26% + ¥99,750 (with tax) for trades of ¥10 million+ to ¥30 million, 0.945% + ¥194,250(with tax) for trades of ¥30 million+ to ¥50 million, and 0.63% + ¥351,750 (with tax) for
trades of more than ¥50 million.

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Risks and commissions associated with products handled by SBI E*TRADE
Fees and commissions (*Transaction fees including taxes at conventional offices)◆ Stock index options brokerage commissions (continued)* 1. The commission is ¥2,625 (with tax) in cases where 4.20% (with tax) of the transaction value isless than ¥2,625.

* Commissions for ordinary transactions, margin transactions and odd-lot transactions
for Japanese stocks and for ordinary transactions, futures and options for foreign
stocks (U.S. and China) are different than the commissions for online accounts.
* Commissions for investment trusts are different than the commissions for online
accounts.
* PTS nighttime transactions, foreign stock (Korea) transactions, foreign exchange
margin transactions and e-warrant transactions are not possible.
* Minors are not allowed to conduct margin transactions or futures and optionstransactions for Japanese stocks.
* Please contact an SBI E*TRADE branch office for more information.

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