JASDEC
ANNUAL REPORT
2016

CONTENTS

p.03

Top Message

p.06

Disclosure Based on Principles for Financial Market Infrastructures ( PFMI )p.07

Corporate Governancep.09

Risk Management

p.11

Business Continuity Plan of JASDEC

p.12

Social Contribution Activities

p.13

Response to the Social Security and Tax Number System

p.14

Response to Integration of Taxation on Financial Income

p.15

Business Overview

p.31

International Relationships

p.35

Consolidated Financial Statements

p.40

Corporate Data

p.43

History

Essential Infrastructure
for Capital Markets

AT A GLANCEFY 2014

FY 2015¥ 997 trillion¥ 982 trillion

70,89071,292

Number of Transactions

111.1 million

118.3 million

Number of Transactions per day

452 thousand

483 thousand

Total Account Balance

Number of Issues HandledTop Message
Haruhiko Kato, President & CEO- 03 -

In playing the role of an important foundation for theWe made a changeover to a company with nominating

financial and capital market as a central securities
depository (CSD), JASDEC strives to conduct stablecommittee, etc. to enhance corporate governance andoperations of its systems and services, and to provide

conducts continuous reforms from the perspectives ofa reliable, convenient and efficient settlement

users including investors, issuers and intermediaries, andinfrastructure so as to contribute to the vitalization ofaddresses the following challenges:

the transparency of management. In addition, JASDEC

Japan’s financial and capital markets and enhanceinternational competitiveness.

1
Contribution to Development of Japan’s Financial and Capital Markets
and Reinforcement of Robust and Efficient Operation

1

Contribution to the revitalization ofJapan’s financial and capital markets

2

We will achieve further stability and efficiency of operations
through a strong grasp of factors including domestic andglobal trends around the JASDEC Group, future vision of
securities settlement structure and services, and the needs ofusers. We will also review and reinforce current operations,and optimize and standardize operations in a cross-sectionalmanner across the group.

With reference to reports such as the Japan Revitalization
Strategy ( Revised 2015 ) issued by the government and thereport of the Council for Tokyo Global Financial Centerpromotional activities jointly held by JSDA, JPX, JITA andJIAA*1, we will contribute to efforts such as shortening thesettlement cycle for Japanese government bonds andshares, and expanding services of CSD and clearing house,
etc. to improve market convenience and vitality, and toestablish Tokyo as a global financial center.

3

Further reinforcement of stability andefficiency of operation

Conducting research and international
activities that contributes to operation

We will conduct research, analysis and information collection
pertaining to the medium- and long-term business prospectsof the JASDEC Group. We will also conduct research on thelatest trends in global settlement services through cooperative
relationships with foreign CSDs and activities at internationalorganizations such as ACG, WFC, ABMF, ISO/TC68 ISO20022
Securities SEG, SMPG, APAC RMPG*2.

*1
JSDA : Japan Securities Dealers Association
JPX : Japan Exchange GroupJITA : Investment Trusts Association, JapanJIAA : Japan Investment Advisers Association*2
ACG : Asia-Pacific Central Securities Depository GroupWFC : The World Forum of CSDs
ABMF : ASEAN+3 Bond Market Forum
SEG : Standards Evaluation Group
SMPG : Securities Market Practice Group
APAC RMPG : The Asia-Pacific Regional Market Practice Group- 04 -

Top Message

2

2

We will review general human resources-related systems
to develop vibrant organization. In addition, we will develop
diverse human resources through temporary transfer ofstaff to other financial market infrastructures and financial
institutions, and interaction with overseas CSDs.

Further Strengthening of
Administrative Structure

1

Strengthening of human resource
development

Strengthening of risk management3

We will ensure robust safety and security necessary for thefinancial market infrastructure by strengthening managementof risks such as operational risks, information system risk;
and, in particular, risks related to service stability andefficiency, business risks and financial risks. In addition, we
will improve the dual-site operation scheme commenced in
February 2016 and enhance simulation exercises of theBusiness Continuity Plan in case of a disaster.

Enhancement of financial base

Recognizing JASDEC’s public role as a financial market
infrastructure, we seek to reduce costs in order to provide
efficient services. In addition, we will further enhance financial
foundation not only by ensuring financial soundness andstability, but also by increasing internal reserves in line withstrategic objectives.

We position IT as a “key element of administration” and work across the group to focus on structure andoperations of high quality settlement system.

1

Securing Settlement Infrastructure Stability

We fully utilize rapidly advancing IT to ensure stable business operation and provide a dependable, efficient and secure infrastructure that is resilient to changes in the environment. In addition, we achieve effective use of resources as well as a reduction in costs.

2

Improving Settlement Services

We swiftly respond to changing environments and the diversifying needs of customers, and improve settlement services topromote active market participation of domestic and global issuers and investors.

3

Strengthen IT

We seek to improve IT skills and strengthen IT engagement as a key provider of settlement services. By achieving this,JASDEC takes the initiative on structuring and operating systems that provides services with high customer satisfaction.

Through the initiatives above, we are determined to operate andprovide systems and services in a stable manner. Always keeping thebest practice of global settlement system in mind, we also improveand strengthen our operations to provide internationally recognizedfunctions. We commit ourselves to satisfying the trust and expectationsof our users.

Haruhiko Kato, President & CEO- 05 -

Disclosure Based on
Principles for Financial Market
Infrastructures ( PFMI )In accordance with the annex "Principles forfinancial market infrastructures: Disclosure

Organization of Securities Commissions ( IOSCO ) ,Frameworks and Assessment Methodology" toPrinciples for Financial Market Infrastructures (PFMI)

public.

JASDEC assesses and discloses its status to theNote:published by the Committee on Payment and

The Committee on Payment and Settlement
Systems (CPSS ) changed its name to theCommittee on Payments and Market
Infrastructures ( CPMI ) in September 2014.

Settlement Systems of the Bank for International
Settlements ( BIS/CPSS ) and the International

The PFMI specifies international standards to becorporate bonds, municipal bonds and investment

applied to systemically important payment systems,
central securities depositories ( CSD ) , securities

trusts - is expected to conduct its operation inaccordance with the PFMI, we consider all areas that

settlement systems ( SSS ) , central counterparties

need to be improved, including frameworks for( CCP ) and trade repositories ( TR ) , with the aim of

gov er na nce a nd r isk m a nag ement , a n d tak e

nurturing more robust financial market infrastructures.
Given that JASDEC - as a CSD and SSS fornecessary actions to comply with all the principles
applied to us.

securities such as Japanese listed shares, CP,Please refer to the following URL regarding our disclosures based on the PFMI;

http: // www.jasdec.com/en /about /office/disclosure.html

As a CCP for non-exchange transaction deliveries( NETDs ) , JASDEC’s wholly owned subsidiary -on the “Principles for Financial Market Infrastructures:

JASDEC DVP Clearing Corporation ( JDCC ) -and the “Public Quantitative Disclosure Standards forassesses and discloses its status to the public basedCentral Counterparties”.

Disclosure Framework and Assessment Methodology”

Please refer to the following URL regarding JDCC’s disclosures based on the PFMI;

http: // www.jasdec.com/en /about /office/dvp/rss/index.html- 06 -

Corporate GovernanceFundamental Approach toward Corporate Governance
JASDEC’s corporate philosophy positions users - including
investors, issuers and market intermediaries - as the main
focus of our business operations. Our shares are owned byinstitutions belonging to the Japanese financial industry, manyof which are also participants in our services. We aim toprovide user-oriented services, while responding appropriately
to environmental and structural changes that affect financial

and capital markets in Japan and overseas, through a governancestructure that is centered on our participant shareholders,
and through frameworks that fully reflect participants’needs. By establishing Advisory Committees comprised ofstakeholders - especially participants, we ensure that theviews of stakeholders are fully reflected in our business
operations and the development of our systems.

Adopting the Structure of a Company with Nominating Committee, etc.
JASDEC is organizationally structured as a company witha nominating committee, etc. This structure provides a clear
demarcation between management supervision functions
and executive functions, as required under the Companies
Act, and reflects internationally recommended principles
and practices. By making full use of lawfully designatedcommittees and other bodies, on which outside directors

hold the majority of seats, we ensure the transparency andfairness of decision-making processes and improve theeffectiveness of management supervision functions. To
ensure timely and efficient operational management, theboard of directors delegates operational decision-making
functions to executive officers.

Corporate Governance Framework

Shareholders’ Meeting
Board of Directors
The majority shall be representative ofshareholders or independent members, while
the others represent executive officers.

Supervision

Nominating
Committee

Determining proposals for shareholders meeting regarding
the appointment and dismissal of directors, etc.

Compensation
Committee

Determining the amount of remuneration for individual
directors and executive officers.

Audit Committee

Auditing execution of duties by directors and executive officers.
Preparing audit reports.

Audit Committee
OfficeExecutive Board

Execution of
Operations

CEO
Executive Officers

CRO

Internal Audit OfficeBusiness Groups

Risk Management
Department- 07 -

Supporting Audit Committee’s activities.

Risk Committee

Advising the board of directors on comprehensive risk
management activities of JASDEC and its subsidiary.

Advisory
Committees

Advising executive officers on issues regarding theexecution of operations.

Integrated Risk
Management Council

Promoting comprehensive risk management activities.

Management Supervision Structure
Board of Directors

Nominating Committee

The Board of Directors determines fundamental management
policies including medium-term management plans, andmonitors progress under those policies. The Board of Directors
also makes decisions on important aspects of management
including the appointment and dismissal of members of thecommittees, executive officers, and representative executive
officers. It also supervises executive officers in the performanceof their duties from a position that is independent fromoperational executive functions.
Our commitment to user-oriented business operations andthe public good is reflected in the fact that the majority of theBoard of Directors are outside directors who are participant
shareholders. The other members are independent directors,
who have no relationship with JASDEC, and directors who
concurrently serve as executive officers.
Outside directors who are participant shareholders are, in
principle, appointed from among major shareholders basedon the frequency with which they use our systems.
In accordance with this policy, the Board of Directors
consists of eight outside directors chosen from among
participant shareholders, three independent directors andtwo directors who concurrently serve as executive officers.

The Nominating Committee, in addition to determining thecontent of proposals submitted to the general meeting ofshareholders concerning the appointment or dismissal of
directors, also promotes sound corporate governance bydeciding on the appointment and dismissal criteria for
directors and executive officers and by confirming thecontent of proposals submitted to the board concerning
matters such as the selection of representative executive
officers, the appointment and dismissal of executive officers,
and the allocation of executive officer duties.

Compensation Committee
The Compensation Committee sets policies on thedetermination of the amount of remuneration for executive
officers and directors. The committee also decides on theindividual remuneration awarded to executive officers anddirectors.

Risk Committee
The majority of the members of the Risk Committee areindividuals who are not involved in operational executivefunctions within the JASDEC Group. The Risk Committee
advises and supports the Board of Directors with respect
to all aspects of risks affecting the JASDEC Group.

Audit Committee
The Audit Committee audits and reports on the performanceof duties by directors and executive officers.

Business Execution Structure
Executive Board

Advisory Committees

The Executive Board, comprising all executive officers,
deliberates and makes decisions on important aspects ofoperational executive functions under the supervision of theBoard of Directors.
The allocation of executive officer duties is decided with due
consideration being given to maintaining mutual supervisionof business groups and ensuring the independence of internal
auditing and overall risk management.

Advisory Committees, which consist of participants andother stakeholders, are established to provide advice andopinion regarding the matters of business operations to
executive officers as requested or otherwise deemednecessary.

- 08 -

Risk Management
Risk Management Structure
JASDEC has established the Basic Policy on Risk Management, which defines basic aspects of risk management activities
by the JASDEC Group, to ensure the soundness and reliabilityof the JASDEC Group as a provider of settlement infrastructure.
Fundamental approach on risk management is outlined below.

Fundamental Approach to Risk Management

Ⅰ

JASDEC Group emphasizes the importance of risk management, and strives to instillawareness of this need in each department and office.

Ⅱ

JASDEC Group, in order to ensure sound management of operations, takes comprehensive measures to manage each risk category, while ensuring that the increasing
diversity and complexity of operations is reflected appropriately in the risk management
structure.

Ⅲ

JASDEC Group shall periodically specify, analyze and assess risks, and will implement
countermeasures to the risk and monitor the status of risk management as necessary.
In the event that a risk materializes, JASDEC Group shall identify the cause, takemeasures to prevent recurrence and, with due consideration of available management
resources, endeavor to minimize the risk to the entire Group.

Ⅳ

JASDEC Group shall remain highly cognizant of the particular importance of managing
information system risk, and shall endeavor to minimize this risk by using standardized
administrative procedures for planning, development and operations of information
systems, maintaining a consistent level of information system quality, and preparing arobust and up-to-date emergency response framework in case of disaster or damage.

Ⅴ

Directors and employees shall maintain a high awareness of risk, and endeavor toensure that business operations are carried out properly at all times, based on anunderstanding that the materialization of risks could significantly damage JASDEC
Group assets and bring about significant losses.

Ⅵ

Each department and office shall endeavor to conduct proper risk management, and if
a risk materializes in the course of conducting operations shall promptly report to theIntegrated Risk Management Council while taking necessary measures to minimize theimpact of the materialized risk.

Framework

Management
PolicyResponsibility- 09 -

We have established a Risk Committee where more thanhalf of the members do not engage in any operation of theGroup. We also have established the Integrated Risk
Management Council, which consists of the officers of theGroup and the heads of departments, under the chairmanshipof the Chief Risk Officer (CRO). In addition, JASDEC has

assigned departments to manage each risk category tomonitor and manage each specific risk under the overall
supervision of the Risk Management Department. By creatingthese organizations, we built a structure capable of providing
comprehensive risk management for the JASDEC Group.

Functional Framework of Risk Management
AdviceBoard of Directors

Risk Committee

Chair : CRO

Integrated Risk Management Council

ReportOfficer in Charge : CRO

Risk Management Department

President & CEO
Departments in Charge ofSpecific Risk Management

ReportManaging Director
in charge ofInformation System risk

Managing Director
in charge ofBusiness Processing risk

Managing Director
in charge ofAccident & Disaster risk

Department
in charge ofInformation System risk

Department
in charge ofBusiness Processing risk

Department
in charge ofAccident & Disaster risk

ReportCheck & Balance

Departments Exposed to Specific Risks- 10 -

Audit

Internal
Audit OfficeBusiness Continuity Planof JASDEC
Our Approach
JASDEC has regularly structured itself so that, in the eventof a disaster or other emergency, it would be able to continue
operations to the extent possible or promptly resume business
operations according to its Basic BCP policy. This is to minimize
the effect of such an emergency on JASDEC participants
and related entities as a settlement infrastructure.
The specific measures taken by JASDEC include formulatingconcrete action plans in advance. JASDEC has defined
actions to be taken in the event of a disaster or otheremergency, such as establishing the BCP Countermeasure
Office, delegated authority, organized emergency contact
networks, and so on. Our IT systems are installed in a robust
main center equipped with a private electrical generator, andour core systems are based on a redundant configuration.
Furthermore, we have built a backup center in a remotelocation to be prepared in case the main center becomes
unusable.

JASDEC SYSTEMBank of JapanUsers

SWIFTNet( BOJ )JASDEC Integrated Network
arrownet offered by TSE

JASDEC Participant
Information Network

ISDN

ISDN

BOJ-NET

Gateways(JEX GW
JASDEC
Extensible
Gateway)

Integrated
ChannelGateway

Integrated
Web
Terminal

File Transfer
Gateway

Participant
Information
Web
Terminal

BOJ’s
Gateway
SystemSubsystems
Pre-Settlement
Matching System

StocksParticipant Information

Foreign Stocks

Corporate Bonds SB &Commercial Papers CP

Investment Trusts

Main Center
Backup Center

SWITCH- 11 -

IT Backup System
Operations data of the main center is reflected at the
backup center almost in real time. In cases where the main
center becomes unusable due to a disaster, infrastructure
failure ( excluding software failure ) or other such event, andthe restoration task is deemed to be time-consuming, thesystems will be switched over to the backup center.

Switchover to backup systems will take about 90 minutes.
Furthermore, to prepare for the prospect of the head officebuilding becoming unusable, we have established analternative office where we can execute operations asnecessary.

Main Initiatives in FY 2015
In FY 2015, we took the following steps to reinforce our business continuity plan ( BCP ).

BCP Exercises

Establishment of Osaka Office

We carried out several company-wide exercises, including
an employee safety confirmation exercise, and an exercise
involving the set-up of a BCP Countermeasure Office, as wellas an employee contact exercise based on a scenario in
which phone lines were congested. There were also activities
aimed at mitigating the damaging effects of disasters, including
in-house rescue training seminars by invited outside experts.
We also carried out training exercises with market participants,
such as data center switching drills with system users, andparticipated in a joint BCP exercise among three markets( securities market, money market, and forex market ), which
was conducted industry-wide.

In order to prevent the entire JASDEC organization frombeing affected at the same time by a wide-area disaster,
we established the Osaka Office as an alternative office inFebruary 2016. We constructed an operating structure
based on a dual site by assigning staff to the Osaka Officeeven in normal times.

Social Contribution Activities
As well as contributing to the economy
through our daily business activities, we
engage in social contribution activities
based on direct employee participation,with the aim of improving people’s lives
and contributing to community
revitalization.

Activities
Recycling of plastic bottle caps as an Eco-friendly action and for charity
Recycling of used stamps and spoiled postcards for charity
Installation of vending machines with donation functions in offices
Participation in the “Table for Two” program- 12 -

Response to the Social Security
and Tax Number System
as “common number” ) are utilized in the administrative
procedures of social security and tax system started operation.
In order to respond to this system, JASDEC has implemented
the required arrangements for Book-entry Transfer System
for Stocks, etc. and Custody Services for Foreign Stock
Certificates, etc., to handle the common number.

Under the “Act on the Use of Numbers to Identify Specific
Individuals in the Administrative Procedure,” a 12-digit
individual number and 13-digit corporate number, respectively,
were assigned to each individual living in Japan and company
beginning in October 2015. Effective as of January 2016, theSocial Security and Tax Number System ( My Number System )in which these numbers ( hereinafter collectively referred to

Responses under the Framework of Book-Entry Transfer System for Stocks, etc.
In accordance with installation of the Social Security
and Tax Number System, taxation requires that acommon number, in addition to name, address andother personal information of the shareholder, be
included in the payment records of dividend. However,
it is difficult for the issuers of listed stocks to be
notified of the common number from their shareholders
each time a dividend is paid. Given the fact that theshareholder’s name, address, etc. have been alreadyprovided to the issuers from Account Management
Institutions (AMIs) through JASDEC using the Book-entry
Transfer System for Stocks, etc., it was decided thatthe common number be provided to issuers in thesame flow - from AMIs through JASDEC using theBook-entry Transfer System for Stocks, etc. - underrelevant laws and regulations.

Issuer ( Administrator of Shareholder Registry )Preparation of payment
record of dividend, etc

Shareholder registry
General Shareholders Notification

Request forcommon number *2( Notification of shareholder’s name and address, etc. )Provision ofcommon number *3

JASDEC
Administration of participants’ information( name, address, common number, etc. )Notification of participant’s information *1( name, address and common number, etc. )Account Management Institution
Administration of participants’ information( name, address, common number, etc. )Notification of name, address and common number, etc.

Participant*1 When receiving common number along with name and address from its participant, AMI notifies that to JASDEC in conjunction with the notificationof participants’ information.
*2 An issuer requests JASDEC to provide the common number of the shareholder for whom an issuer prepares the payment record of dividend, etc.
*3 JASDEC provides the issuer with the requested shareholder’s common number on the condition that the common number has been provided to
JASDEC by AMI.

Responses under the Framework of Custody Services for Foreign Stock Certificates, etc.
JASDEC has the obligation to submit the dividend
payment records, etc. for foreign stock certificates, etc.
that includes the common number with the district
director of the tax office under Income Tax Act; tofulfill its obligation, the common number needs to beprovided to JASDEC from AMIs. Therefore, by utilizing
the reporting system of AMIs to provide their beneficial
shareholders’ information of foreign stock certificates,etc. to JASDEC, the provision of the common number
to JASDEC was allowed under the relevant laws andregulations.

The District Director of the Tax OfficeSubmit dividendpayment records *2

JASDEC

Preparation of dividend payment records

Every Record Date

Report of beneficial shareholders of foreign stock
certificates, etc. *1( name, address and common number, etc. )Account Management Institution for Foreign Stock Certificates, etc.
Information on beneficial shareholders of foreign stock certificates, etc.
( administration of name, address and common number, etc. )Notification of name, address and common number, etc.

Beneficial Shareholder of Foreign Stock Certificates, etc.
*1 An account management institution for foreign stock certificates, etc. provides JASDEC with a common number on the report of the beneficial
shareholders of the foreign stock certificates, etc. every time record date arrives.
*2 JASDEC submits the dividend payment records, etc. which includes the common number to The District Director of the Tax Office.

- 13 -

Response to Integration of
Taxation on Financial Income
Since the laws and regulations related to a review of thebond tax system (integration of taxation on financial income)have been enforced pursuant to the provisions of the Act on
the Partial Revision of Income Tax Act and Other Acts ( Act No.
5 of 2013 ), JASDEC has put in place and executed necessary
measures to review the classified account structure since
January 2016.
Under the tax system reform, expansion of the profit / loss
offset scope between financial products, and changes in the
taxation method for interest income on bonds, and withholding

tax agent were incorporated for the purpose of introducing
integration of taxation on financial income.
Following these revisions, JASDEC considered how to best
address the matter and put in place necessary measures for
the Book-entry Transfer System for Stocks, etc. ( corporate
bonds with share options ) and the Book-entry Transfer System
for Corporate Bonds, including system development andrevision of the Business Regulations. Below is a summary of
the measures taken:

Review of the Classified Account
Structure

Abolishment of Restriction on Transfer
between Taxation Classifications

Under the tax system reform, a withholding tax agent ischanged from an issuer to an Account Management Institution( AMI ) by satisfying certain requirements and proportionate
taxation on interests on bonds according to the holding period isabolished. Therefore, classified accounts management according
to the taxation characteristics of investors (e.g. classify an accountto apply the tax exemption system for non-residents) has been
made unnecessary. Based on these revisions, JASDEC hasreviewed the classified account structure ( including integrationof a non-resident, etc. account into a customer account in theBook-entry Transfer System for Corporate Bonds and theabolishment of taxation classification in a customer account ).

Necessary revisions were made to abolish restrictions
on transfer from account for taxation to account for
non-application of tax withholding.

Review of Handling Declaration of
Taxation Information
Necessary revisions were made to items in the declarationof taxation information made by JASDEC participants to apaying agent of issuer under the Book-entry Transfer System( e.g. tax category ).

Summary of Review of Customer Account in Book-entry Transfer System for Corporate Bonds
Before Revision

After Revision
Taxation Classification

Customer
Account

For non-application oftax withholding

Abolish taxation
classification.

For taxation

Taxation Classification
Customer
Account(N/A)

Taxation Classification
Non-resident, etc.
Account

Abolish non-resident, etc. account andintegrate it into customer account.

For non-application oftax withholding
For taxation- 14 -

BUSINESS OVERVIEW

01
Book-Entry Transfer System
for Stocks, etc.

The Book-entry Transfer System
for Stocks, etc.

IssuerShareholder registry
General Shareholders Notification

JASDEC
Transfer AccountBook

Book-entry transfer

Transfer AccountBook

Direct AccountManagement Institution

Direct AccountManagement Institution( securities companies, banks, etc. )( securities companies, banks, etc. )Indirect AccountManagement Institution( securities companies, banks, etc. )ParticipantsParticipantsParticipants( shareholders )( shareholders )( shareholders )- 15 -

Products / Services
Transfer and rights handling related to the following products:• Listed shares• Exchange Traded Funds ( ETF )• Listed bonds with share options• Listed Beneficial Interest in a trust issuinga beneficiary certificate ( such as JDR )• Listed share options• Qualifying Unlisted stocks• Investment Units of listed Real Estate Investment
Trust ( REIT )• Qualifying Unlisted bonds with share options• Listed investment equity subscription rights• Qualifying Unlisted share options• Preferred Equity Investments
by listed Cooperative Financial Institution
JASDEC launched its Book-entry Transfer System for
Stocks, etc., under the Act on Book-entry of Company
Bonds and Shares ( Book-entry Transfer Act ) in January
2009. Under this system, listed securities are managed in
the accounts opened at JASDEC or Account Management
Institutions ( AMIs ) such as securities companies and banks
by electronic records registered in their computer systems.
The Book-entry Transfer System has a variety of featuresthat contribute to the safety and convenience of securities
settlement.
Only the electronic records determine the vesting of rights
pertaining to stocks, etc.; and the rewriting of those records

transfers those rights. This reduces the cost of printing,storing and transporting securities in physical form, alongwith the risk of loss or theft.
JASDEC provides issuers with all shareholder information
as of the record date ( General Shareholder Notifications ),which is needed to compile shareholder registries. To ensurethat information is supplied efficiently, JASDEC maintains
centralized management of shareholder information. For
example, JASDEC preliminarily obtains and integrates thename, address and other information on shareholders from
AMIs.

JASDEC Participants and Indirect AMIs

( as of March 31, 2016 )JASDEC participants by category

Total

174

companies

Securities companies, etc.

140 ( 80% )Banks, etc.

20 ( 11% )Life & non-life insurance companies

1 ( 1% )Securities finance companies

2 ( 1% )Stock exchanges, etc.

11 ( 6% )Indirect AMIs by category

Total

114

companies

Note:

Foreign indirect AMIs

63 ( 55% )Securities companies, etc.

35 ( 31% )Banks, etc.

16 ( 14% )- 16 -“Banks, etc.”
include The Norinchukin Bank, Tokyo Shoken Shinyou Kumiai,and Japanese Banks’ Payment Clearing Network.

“Stock exchanges, etc.”
include Japan Securities Clearing Corporation,
JASDEC DVP Clearing Corporation,
three securities agents and three Tanshi companies( which offer short-term credit brokerage services )01 Book-Entry Transfer System
for Stocks, etc.

Usage in FY 2015
JASDEC deals with dematerialized forms of securities
such as shares, bonds with share options, share options,investment units of REITs, investment equity subscription
rights, preferred equity investments by cooperative financial
institution, ETFs, and beneficial interest in a trust issuing abeneficiary certificate such as JDRs.
As of March 2016, the total number of issues handled was
3,936, including 3,640 share issues, 30 bonds with shareoptions, 10 share options, 54 investment units, 1 preferredshare issue, 146 ETFs, and 55 JDRs. The number ofcompanies participating in the Book-entry Transfer System,
including JASDEC participants ( direct AMIs ), indirect AMIs,
and fund settlement corporations, etc., was 380. Foreign
institutions designated by the relevant minister are also
allowed to participate in the System as AMIs. As of March
2016, 63 foreign financial institutions are indirect AMIs.

Initiatives Taken in FY 2015
Shortening stock settlement cycle is under discussion at
the “Working Group on Shortening Stock Settlement
Cycle” hosted by Japan Securities Dealers Association( JSDA ). JASDEC participates in the discussion as the key
secretariat of the Customer-side Sub-working Group inwhich we consider issues mainly related to customer-side
transactions.
Issuers of Book-entry transfer shares are required to
notify JASDEC of the details on corporate actions when

they determined to initiate them. JASDEC continues toengage in the promotion of awareness regarding notification
procedures, etc. through meetings for issuers by visiting
local discussion group for laws and practical business onequity securities ( Kabushiki Konwa Kai ).

Book-entry Transfers( Billion shares )( Billion shares )Stock-exchange transfers

Transfers between JASDEC participants
Internal transfers within the same companies

396.7

400
321.0

335.7

1,500

200

1,000

100

500

2011

2012

2013

2014

1,111.3

356.2

300

0

1,241.8

2,000
350.3

2015

0

( FY )- 17 -

1,148.9

797.2
669.4

652.5

2011

656.8

2012

732.4

2013

724.7

2014

767.2

2015

( FY )

Account Balance and Number of Issues
StocksBonds with Share Options( Billion shares )( Issues )

450
406.8

3,561

( Issues )

5,820

6,000

959.7

1,000

2013

0
2015 ( FY )

22

27

0

24

133.4

163.8

2012

2013

2014

2,791
2,339

2,000

346.6

16
2011

30

250
201

3,409

3,000

40
500

2014

4,000

499.6

300

4,384

60

3,400

2012

( Million units )

80

3,600

3,602

300

2011

( Issues )

3,800

3,548

0

ETFs and JDRs

1,500

3,640
3,581

Number of issues ( end of FY )

5,000

404.6

400

( Billion yen )

4,000

438.3

433.9

431.0

350

Account balance ( end of FY )

100

1,000
0
2015 ( FY )

200
150

154

126

111

20

185

50

0

2011

2012

2013

0
2015 ( FY )2014

General Shareholder Notifications
Number of Issues and Total Shareholders

Total shareholders

Number of General Shareholder Notifications

Number of issues* Figures are as of day of notification to issuers.

( Thousand shareholders )( Issues )( Notifications, in billion )150,000

15,0001,200

127,292

125,694

129,258

127,623

127,032

8,723

8,597

9,136

8,771

8,715

6,000

30,000

3,000

2012

2013

2014

2015

947.3

961.8

2011

2012

2013

( FY )

00

Number of notifications( Thousand notifications )( Thousand shareholders )22,5002,800
16,727

17,0632015( FY )

Individual Shareholder Notifications* Number of shareholders (data for shareholder notifications) is integration of participant information notified by AMIs.

18,0002014

200* Figures are as of end of fiscal year.

18,005

1,036.5

400

Number of Shareholders ( Data for shareholder notifications )17,547

1,021.4

600

60,000

2011

972.8

800

9,000

90,0000

1,000

12,000120,000

18,605

2,697

Number of issues( Issues )

2,649

2,428

1,000

2,392

2,279

810

2,100

800
733

720

13,500

600

626
1,400

9,000
700

4,500
0

400

401

2011

2012

2013

2014

2015

0

( FY )

200

2011

2012

2013

2014

2015 ( FY )0

Information Requests ※Number of Notifications

Number of Issues( Total record ) notifications( Total record ) number of issues( Partial record ) notifications( Notifications )( Partial record ) number of issues( Issues )

6,000

5,443
4,969

800
5,216

4,500

600
3,069

3,000

672

114

122

135

2013

2014

2015

482

3,415

3,252

654
580

400

2,688

302

1,857
1,500

200
375

0

2011

521
2012

2013

2014

2015

0

( FY )

77

57

2011

2012

( FY )※ Requests for information (total record) refer to requests for data recorded on Book-entry transfer registries of either JASDEC participants (direct AMIs) or indirect AMIs where shareholders in question have opened accounts.
Requests for information (partial record) refer to requests for data recorded solely on Book-entry registries of JASDEC participants where shareholders in question have opened accounts.

- 18 -

BUSINESS OVERVIEW

02
Book-Entry Transfer System for
CPs, Corporate Bonds andInvestment Trusts

Flowchart for Book-entry Transfer for CP / Corporate Bonds ( DVP )1 TradeSeller

Buyer

JASDEC
2 Trade matching

2 Trade matching

Affirmation
3

Notice of settlement
matching status

Settlement
parties

Settlement matching
Pre-Settlement
Matching System

3

Notice of settlement
matching status

44Notice of settlement status( Awaiting fund settlement )Notice of settlement status( Awaiting fund settlement )9

Notice of securities
transfer completion

Securities transfer
Book-entry Transfer System
for CP / Corporate Bonds

8 Notice of payment completion

Settlement
parties9

Notice of securities
transfer completion

5 Payment instruction
6 Payment request

Fund settlement
corporation

8

Fund settlement
corporation

Bank of Japan

Notice of payment completion

7 Payment instruction- 19 -

Products / Services
Transfer and rights handling related to the following products:• Short-term Corporate Bonds ( dematerialized CPs )• Bonds issued in Japan by foreign entities( Samurai Bonds and Shogun Bonds )• Corporate Bonds• Quasi-bond Beneficial Interests ( J-Sukuk )• Municipal Bonds• Investment Trusts Managed Based on
Instructions from the Settlor• Investment Corporation Bonds• Bonds issued by FILP agencies or
public corporations by local governments
In March 2003, JASDEC launched the Book-entry Transfer
System for Short-Term Corporate Bonds ( dematerializedcommercial papers ( CPs )), which was followed by the launch of
the Book-entry Transfer System for Corporate Bonds andMunicipal Bonds, etc. in January 2006. In January 2007,
JASDEC also started the Book-entry Transfer System for Investment Trusts in which investment trusts managed based on
instructions from settlor defined by “Act on Investment Trusts
and Investment Corporations” were handled.
In each system, settlement procedures - issuance ( subscription ), trading ( transfer ), and cancelation ( redemption ) - areconducted based on the balance electronically recorded in thetransfer account books. In addition, delivery versus payment( DVP ) settlement is available via the linkage between JASDEC’s

Book-entry Transfer System and the Bank of Japan Financial
Network System ( BOJ-NET ). By interfacing the Book-entry
Transfer System with its Pre-Settlement Matching System( PSMS ), JASDEC has realized straight through processing( STP ), which fully automates the entire process from trade
matching to settlement.
As a means of managing participation in JASDEC’s Book-entry
Transfer System, we set up a multilayer holding structure fordirect/indirect account management institutions ( AMIs ) toaddress the diverse needs of investors and financial institutions.
For example, direct AMIs can open an account directly at
JASDEC and indirect participation is possible by opening an
account at a direct AMI. Another option for indirect participationis through the opening of an account at an indirect AMI.

Flowchart for Book-entry Transfer System for Investment Trusts
Flow of funds
Flow of data

Investors( beneficiaries )Private vendor financial network systems / fax(

Fund
distributors( trustors )securities companies,
banks,
insurance companies,
etc.

)
AMIs

JASDEC

Fund settlement
corporations(

BOJ-NET
Fund settlement
corporations

Issuers)

Trustees

Fund settlement
corporations

Bank of Japan
Japanese banks’
payment clearing network- 20 -(

BOJ-NET
Fund settlement
corporations)

02 Book-Entry Transfer System for CPs, Corporate Bonds
and Investment Trusts

Usage in FY 2015
With regard to Book-entry Transfer System for CPs,
against the backdrop of the trend of corporate finance,
3,617 issues were handled through the system and theaccount balance stood at 12.9 trillion yen as of the end of
March 2016. The average transferred amount via theBook-entry Transfer System per day was 5.1 trillion yen in
FY 2015. The number of system users including JASDEC
participants and indirect AMIs was 274 in total.
As to the Book-entry Transfer System for Corporate
Bonds, given the investment environment, 53,825 issues
were handled through the system and the accountbalance was 250.4 trillion yen as of the end of March 2016.
The account balance of U.S. dollar-denominated bonds

CP Account Balance ( nominal value )and Number of Issues

amounted to US $7,643 million in the context of the trend of
foreign-denominated currency funding. Moreover, renminbi( RMB )-denominated bonds were issued for the first time.
The total number of users including JASDEC participants
and indirect AMIs was 856.
Regarding the Book-entry Transfer System for Investment
Trusts, sales values of investment trusts amounted to around
10 trillion yen per month during April to August 2015 basedon the market condition and growing Nippon Individual
Savings Account ( NISA ). While 9,878 issues were handled,
the account balance stood at 160.9 trillion yen as of the end of
March 2016. The total number of users including JASDEC
participants and indirect AMIs was 867.

Corporate Bonds Account Balanceand Number of Issues

Account balance ( end of FY )Number of issues ( end of FY )( Trillion yen )25( Issues )

5,000

4,447
3,926

20

3,552

15

13.7

13.6

3,717
14.2

12.6

4,000

2,000

5

1,000

2011

2012

2013

0
2015 ( FY )2014

( Issues )( Trillion yen )400

75,000200

58,486150
50,000

252.4

252.7

253.2

251.7

250.4

0

2011

2012

2013

0
2015 ( FY )2014

Issuance, Transfer and Redemptionof Corporate Bonds ( Daily average )Redemptions

Redemptions
Transfers

4.0

0.4
5.6

0.4
5.1

1,000
800

119.5
637.0

130.8
585.8

834.8

137.7
134.3

643.4

0

2,000

2011

2012

2013

0
2015 ( FY )

2014

0.4
0.4
2014
2015 ( FY )Principal Values of Investment Trusts forPurchases and Cancellations ( Daily average )Purchases
Cancellations

553.3

487.3

439.1

400

341.5
282.5

470.1

412.6

386.8

326.7

289.6

100
133.9

0

479.2

200

200

1.0
0.4
0.4
2012
2013

4,000

300

400

2.0

0.5

6,000

500

600

2011

115.3

129.4

3.0

0

124.5

( Billion yen )

1,200

7.0

4.0

8,000

141.8

Issuance( Billion yen )

0.4
4.1

112.5

160.9

7,112

50

100

Issuance

0.4
4.1

6,868

25,000Transfers( Trillion yen )0.5

10,000Account balances are calculated by multiplying the principal amounts
for each issue by the number of accounts

Issuance, Transfer andRedemption of CP ( Daily average )5.0( Issues )100* Nominal value is the value at time of issuance( based on the amounts for each bond )

6.0

9,878
8,956
7,940

55,595 54,294 53,825

300

200

10

0

( Trillion yen )

3,000

12.9

Account balance ( end of FY )Number of issues ( end of FY )Account balance ( end of FY )Number of issues ( end of FY )60,701
3,617

Investment Trusts Account Balanceand Number of Issues

2011

136.9

2012

140.5

2013

- 21 -

135.8

2014

127.1

2015 ( FY )

0

2011

2012

2013

2014

2015

( FY )

Initiatives Taken in FY 2015
With regard to Book-entry Transfer System for CPs,JASDEC responded to the “Quantitative and Qualitative
Monetary Easing with a Negative Interest Rate” that the BOJ
decided to introduce at the Monetary Policy Meeting held inJanuary 2016 by revising the Book-entry Transfer System
for CPs so that CPs with negative interest could be issued.
Regarding Book-entry Transfer System for Corporate
Bonds, at the request of the Study Group to Vitalize the
Corporate Bond Market hosted by the Japan Securities
Dealers Association (JSDA ), JASDEC explored ways to createa framework to ensure the efficient transmission of data on
necessary information from issuer to bondholders. This
resulted in the launch of the Bond Information Transmission

Service. A study group consisting of working-level members
was held to apply exemption provision of U.S. withholding
tax on the payment of principal and interest of U.S. Samurai
Bonds issued on and after January 2016. The study groupalso discussed how to respond to the QI system ( obtaining
QI qualification via AMIs and paying agents ), and developed
guidelines on operational procedures.

Participants in
Book-entry Transfer System
for CP( as of March 31, 2016 )Issuers 511
Issuing /paying agents

19

JASDECJASDEC participants( Direct AMIs )Indirect
AMIs

68

46

CP holders

Fund settlement corporations 141

Participants in
Book-entry Transfer System
for Corporate Bonds( as of March 31, 2016 )Issuers 2,709*
Issuing /paying agents

196

JASDECJASDEC participants( Direct AMIs )Indirect
AMIs

86

433

Fund settlement corporations 141

Participants in
Book-entry Transfer System
for Investment Trusts

Issuers 91

Bond holders* Issuers do not include unlisted companies, etc.,that issued private offering bonds only.

Trustees 11( as of March 31, 2016 )JASDECJASDEC participants

172

Designated fund distributors
Indirect AMIs

641
- 22 -

344

BOJ-NET Fund settlement corporations

43

BUSINESS OVERVIEW

03
DVP Settlement System
for NETDs

Reducing Principal Risk by Using the DVP Settlement Method

Delivery of securities

SellerTransfer of securities and payment carried out separately

Buyer

Payment of settlement amount

Use of DVP settlement
Account delivery through JASDEC

Seller’s
account

Securities data

Account of JASDEC
DVP Clearing Corp.

Securities data

Buyer’s
account

Provision / receipt of funds through current accounts at the Bank of Japan

Seller’s
account

Funding data

Account of JASDEC
DVP Clearing Corp.

- 23 -

Funding data

Buyer’s
account

Products / Services

each transaction ( gross ). Meanwhile, the settlement amounts
pass through JDCC’s account within the BOJ-NET funds
transfer system, and settlement is concluded by the appropriate
net calculated amount of funds being paid on each settlement
date ( net ).

Since May 2004, the DVP settlement system for Non-Exchange Transaction Deliveries ( NETDs ) has been administeredby JASDEC’s wholly owned subsidiary, JASDEC DVP Clearing
Corporation ( JDCC ). The system mainly deals with non-exchange transactions of securities handled by JASDEC throughits Book-entry Transfer System for Stocks, etc., such as sharesand bonds with share options, majority of which consist of
settlement of Japanese equities trades by domestic and overseas
institutional investors. In January 2014, we commenced DVP
settlements for stock lending transactions.
Previously, the delivery of securities and the payment of thesettlement amounts for non-exchange transactions were mostly
processed separately, so the transactions were exposed to therisk ( principal risk ) such as that cash payments may not be
executed even though the securities had been delivered. The
use of the DVP settlement system for NETDs links the deliveryof the securities and the cash payment of the settlement
amounts through the system, mitigating the risk and making it
possible for securities settlements to be conducted safely andreliably. To further support reliability, the entire operating process
is handled automatically and electronically enabling straight
through processing ( STP ).
JASDEC participants applying to make use of the system areexamined for their suitability in terms of financial condition,organizational structure and other such factors before receiving
authorization from JDCC. In order to ensure stringent risk
management of all participants, JDCC secures collateral inadvance, comprising assets ( assurance assets ) with theappraisal value that exceeds the net debit ( total payables total receivables ) of each participant, and sets an upper limit on
the value of the liabilities payable ( the net debit cap ) in proportion
to the trading status of each participant.
Settlement within the DVP settlement system for NETDs is
conducted in accordance with the so-called “Gross-Net DVP
model” by which securities pass through the JDCC accountwithin JASDEC and the transfer of the securities from theseller’s into the buyer’s account is conducted separately for

JDCC secures a source of liquidity through deposits received
for Participants Funds as well as a bank credit line provided bycommitment line banks. This is established to ensure sufficientliquidity to cover the default of two DVP participants that would
create the largest net debit.
In FY 2015, based on the PFMI formulated by the BIS/CPMI
and IOSCO, JDCC took action to reinforce its risk management.
As a part of such initiatives, JDCC plans to establish a net
debit cap for each financial group by March 2017 so as to takeappropriate response even in the event that one DVP participant
on a consolidated basis ( including other DVP participants
belonging to the same financial group as such DVP participant )defaults, and reviewed the bank credit line after April 2016
so that JDCC can respond to the insolvency of one of thecommitment line banks.

DVP Settlement for NETD Transactions ( Daily average )DVP Settlement for NETD Fund Settlement ( Daily average )Non-DVP transactions

Usage in FY 2015
As of the end of March 2016, 52 companies ( comprising 12banks and 40 securities companies ) participated in the DVP
settlement system for NETDs. Excluding internal transfers
within the same company, DVP transactions accounted forabout 70% of NETD transactions, this shows the use of thesystem has become firmly established as an importantcustomer-side settlement method.
In FY 2015, the usage of DVP settlements continued to increase.
In consideration of the above, we refunded 256 million yen of
settlement fees in total according to each participant’s usage
level.

Initiatives Taken in FY 2015

DVP transactions

Total payments

Total value of net settlement payments

Rate of reduction ( Total value of net settlement payments / Total payments × 100 )( Transactions )( Billion yen )(%)

180,000

2,500

15

52,591160,000
48,537

46,899

2,000

1,000

80,23540,000

500

0

0

844.2

100.1
2012

12.2

12.8

2013

2014

2015

( FY )

DVP transactions are the number of transfers execute (transfer from DVP participants to JASDEC DVP Clearing
Corporation)

13.0
2,005.6
10

1,498.5

1,500

123,605

98,6892011

12.7

1,687.4
114,555

82,522

11.9

45,570120,000
80,00050,686

2011

876.2

111.3
2012

5

183.5
2013

216.8
2014

259.8
2015

( FY )

0

Securities covered: Stocks, bonds with share options (convertible bonds), ETFs, REITs, share options (sharesubscription warrants), foreign stocks, etc.
Total payments is the total amount used for execution of securities transfers.
Total value of net settlement payments is the total amount used for a net transaction basis.

- 24 -

BUSINESS OVERVIEW

04
Pre-Settlement
Matching System ( PSMS )PSMS for Non-residents’ Transactions
Overseas
Order

Investment
managers

Securities
companies

Notice of execution
Allocation, matching

Settlement instruction

Globalcustodians

Notice ofexecution

Settlement
instruction

Settlement instruction

Japan
Settlement
instruction

Subcustodians
Notice ofmatching status

Pre-Settlement
Matching System*

Settlement
instruction

Linkage with Book-entry Transfer Systems for Stocks, etc., Corporate Bonds and CP( excluding Japanese government bonds )- 25 -

Securities
companies

Notice ofmatching status

Request for DVP transfer* From January 2014, onward, “Tolerance Matching” function is available.

Order

Notice ofexecution

Order

Stock
exchanges

Products / Services
Matching of the transaction and settlement terms of the following products( domestic transactions and non-resident transactions ):• Shares, etc.

• Japanese Government Bonds ( JGB )• Convertible Bonds• Futures / Options• Corporate Bonds, CP

Since the launch of Pre-Settlement Matching System( PSMS ) in September 2001, JASDEC has promoted
Straight Through Processing ( STP ) in the Japanese securi-connectivity, JASDEC was the first company in the global
securities settlement industry to introduce the ISO
20022-based message format that is the new international
standard for financial messaging. The adoption of ISO
20022 will lead to not only enhanced system connectivity but
also improved compatibility of Japanese market practices
with the global ones. JASDEC participates in the discussionof International Organization for Standardization ( ISO ), theSecurities Market Practice Group ( SMPG ), and other suchbodies and contributes to them actively.

ties market, by providing matching function of trade andsettlement information to institutional investors and otherbodies. PSMS, as an intermediary between the transaction
process and the settlement process, has the following
three basic concepts:
1

Rapid post-trade process2

Automatic data linkage to CCP and Book-entry
Transfer System for Delivery Versus Payment ( DVP )settlement

3

Total Number of PSMS input / output Instructions
Using the PSMS system ( Daily average )Implementation of a globally standardized message
format suitable to both domestic and non-residents’transactions( Thousand )

1,930

2,000
1,766

It is crucial for financial institutions to smoothly andsecurely complete the settlement process of huge numberof transactions. While Book-entry Transfer System realizes
secure settlement, PSMS, in addition, helps to achieve asmooth settlement.
Now that more than a half of share transactions are
conducted by non-residents, it is important to facilitate
easy access to the Japanese market from all over theworld. In January 2014, as a measure of enhanced system

1,577
1,500

1,360

1,353

2011

2012

1,000

500

0

2013

2014

2015

( FY )

Usage in FY 2015
PSMS, as a primary matching infrastructure in Japanesemarket, was utilized by 677 users as of the end of March2016. Given the buoyant Japanese stock market, the numberof input /output transactions of PSMS increased to 1,930

thousand on a daily average, which recorded the highest
number since the launch as shown above.
In addition, 53 out of 179 users have already migrated fromthe ISO 15022-based message format to ISO 20022.

- 26 -

04 Pre-Settlement

Matching System ( PSMS )Initiatives Taken in FY 2015
JASDEC has already taken initiatives to contribute to
making the Japanese securities market much more
efficient.
In November 2015, the Japan Securities Dealers Association( JSDA) started a system for disclosing transaction informationon corporate bonds so as to revitalize the Japanese bondmarket. JASDEC implemented functions to provide JSDA
with incoming transaction data on corporate bonds sent to
PSMS in support of the realization of the efficient operationof the system.
Moreover, JASDEC participates in discussions held amongmarket players regarding the shortening the settlement cycleof JGB.
While JASDEC believes a shorter settlement cycle would
contribute to a reduction in settlement risk as a direct
effect, improvement in market liquidity and enhancement incompetitiveness among overseas markets would also be
achieved as an indirect effect. In addition, the balance of
JGB has tended to rise over the years, and the market
is now quite large. Given these situations, shortening thesettlement cycle would contribute greatly to the above-noted
effects. JASDEC is currently prepared to start T+1 settlement( T+0 settlements for GC repo transactions ) for outrighttransactions in JGB in the first half of 2018. System
implementation includes a revision of trade matching functions,linking matched trade data to the Japan Securities Clearing
Corporation ( JSCC ), and the distribution of JSCC notices
to PSMS users. JASDEC also participates in planning anddiscussion of integrated test scheduled in the latter half of2017, which aims to verify system processing among all JGB
market participants and to enhance the level of operational
skill under the new business practice.

PSMS for Domestic Stock Transactions ( Centralized matching for three parties )Stock exchanges
Notice ofexecution

Investment trust
management /investment advisory
companies

Investment instruction

Order

Order
Notice of execution
Allocation

Pre-Settlement Matching System( PSMS )Trade matching

Investment instruction
and trade report

Trade report

Securities
companies

SSI

Trust banks

Trade reportaffirmation

Settlement matching

Request for DVP transfer *Linkage with Book-entry Transfer Systems for Stocks, etc., Corporate Bonds and CP ( excluding Japanese government bonds )* From January 2014 on, DVP settlement for Stock Lending and Borrowing ( SLB ) transactions is available.

- 27 -

BUSINESS OVERVIEW

05
Custody Services for
Foreign Stock Certificates, etc.

Overview of the System Relating to Foreign Stocks

Share-handling service agents ( trust banks )Notice of beneficial
shareholders(

Shareholder notice host

Beneficial
shareholder
reportJapan Securities Clearing Corporation

Dividend
information

handling of information concerning beneficial
shareholders, dividends, etc.

Collateralmatching

Overseas CSDs

Dividend
information

Custodian banks

Stock exchange DVP)

Notice ofbalance

Account transfer host( settlement )Non-DVP
transferfor NETD

DVP transfer
for NETD

AMIs ( Securities companies and banks )Beneficial shareholders of foreign stock certificates, etc.

- 28 -

Local
custody /transfer

Communication
server with foreign
CSDs / banks

05 Custody Services for

Foreign Stock Certificates, etc.

Products / Services
Custody, transfer and rights handling related to the following products:• Beneficiary certificates in a trust issuing a listed
foreign beneficiary certificate• Listed foreign shares• Listed certificates of foreign share options• Listed foreign covered warrants• Listed foreign investment trust beneficiary
certificates• Depository receipts of foreign shares• Listed foreign investment securities

In May 2006, JASDEC commenced services to process
deposits, transfers, and corporate actions for foreign sharecertificates, etc., listed on Japanese stock exchanges.
Although foreign share certificates, etc., are generally
deposited with CSDs or custodians in the same countries
as the issuing companies, settlements of transactions at
Japanese stock exchanges are conducted through Book-entry
transfer in JASDEC. JASDEC entrusts dividend payments torelevant share-handling service agents and dividend-paying
banks. Information on beneficial shareholders at the dividend
record date is transferred from the JASDEC participants tothe share-handling service agents through JASDEC. Based on
this information, the share-handling service agents calculate

the amount of dividends, which are then paid directly to thebeneficial shareholders from the dividend-paying banks.
JASDEC also undertakes the necessary procedures
regarding dividend taxation for tax authorities and othersuch entities, for tax relief under tax treaties with the countries
concerned. Beneficial shareholders can also exercise theirvoting rights at general meetings of shareholders throughinstructions issued to JASDEC.
JASDEC therefore provides the infrastructure and services
necessary for reliable settlement of foreign share certificates,
etc., smooth exercise of shareholder rights, and assured
receipt of dividends and other payments.

Foreign Stocks, etc. Account Balanceand Number of Issues( excluding foreign covered warrants )Account balance

Number of issues( Thousand shares )( Issues )200,000

160,00050

189,208
38

37

39

39

40

36

120,000

30

105,964
88,93086,57792,42280,00020

40,00010

0- 29 -

2011

2012

2013

2014

2015

( FY )

0Usage in FY 2015
At present, there are three types of foreign securities thatare handled by JASDEC: foreign shares; foreign investment
trust beneficiary certificates; and foreign investment securities.

As of March 31, 2016, the total number of issues handled by
JASDEC was 36.

Initiatives Taken in FY 2015
In response to changes in the QI withholding tax system
relating to U.S. shares, JASDEC continued from FY 2014 toprepare for application of reduced tax rate to dividend on
U.S. shares such as revising its format that is submitted or
received to/from JASDEC participants and changing typesof withholding tax. These changes were implemented in
December 2015.

In addition, JASDEC worked to improve services forbeneficial shareholders and participants, including a study
concerning the handling of listed products from various
countries that are likely to be listed on Japanese stock
exchanges.

Number of Shares Deposited / Withdrawn

Book-entry Transfers

Number of shares withdrawn

Number of shares deposited( Thousand shares )( Thousand shares )150,000

400,000

365,437

131,801
302,746

300,000
100,000

Exchange transaction transfers

Non-exchange transaction deliveries

91,672

242,710

236,159

191,488

200,000

71,16759,72750,000249,629

163,944
133,51141,840116,370

115,001

100,000
15,650022,62828,306
16,863
8,432

2011

2012

2013

2014

2015

0

( FY )- 30 -

2011

2012

2013

2014

2015

( FY )

International
Relationships
JASDEC conducts research on overseas trends andengages in frequent information exchanges with overseas
institutions as essential parts of its ongoing efforts to deal
with the myriad issues that affect the securities market
infrastructure such as the globalization of financial andcapital markets and the global tightening of regulations,and als o t o cont r i b u t e t o t h e d e v e l o p me n t of t heinfrastructure of securities market in Japan and other partsof the world. We participate in regular CSD meetings,
seminars and international conferences and maintain active
exchange programs with institutions with which we havesigned memorandums of understanding ( MOUs ).

ACG ( Asia-Pacific Central Securities Depository Group )and operation of Cross Training Seminar ( CTS ) every year
for the purpose of information exchange at the working
level. JASDEC engages in planning and operation as amember of the Executive Committee and the convener ofthe Exchange of Information Task Forces.

The ACG, currently represented by 34 institutions, wasestablished in November 1997 as a forum for informationexchange and mutual cooperation among CSDs in the
Asia-Pacific region. In the ACG, JASDEC, as an Executive
Committee member, participate in the administration of
ACG General Meeting ( AGM ). We also engage in planning

WFC ( World Forum of CSDs )The WFC was created in April 2011 at the 11th Conferenceof CSDs, after agreement was reached among leadersof the world’s five regional CSD associations. The WFC
is administered by a 10-member board made up of two
representatives from each regional association. JASDEC
participates on behalf of the ACG with the Central Depository
Company of Pakistan Limited ( CDCPL ).
The WFC has an active program of initiatives, including theSingle Disclosure Project, the aim of which is to create a

database of CSD information by ensuring unified andefficient disclosure of Principles for Financial Market
Infrastructures ( PFMI ) by the Committee on Payments andSettlement System of the BIS and the International Organizationof Securities Commissions ( CPSS-IOSCO ), and response to
the questionnaire of the Association of Global Custodians( AGC ).

- 31 -MOUs on Information Exchange and Mutual Cooperation
with Overseas CSDs, etc.
JASDEC has signed MOUs on the exchange of informationand mutual cooperation with 18 overseas CSDs and CCPs.
With MOU partners, we are actively implementing initiatives,
including exchanges of information, cross-training programs

involving trainee exchanges, and support for CSDs of
emerging nations.

The Asian Bond Markets Initiative ( ABMI )With ASEAN+3 Finance Ministers and the Central Bank
Governors’ Meeting positioned as its foremost body, theABMI established four Task Forces. Under the third Task
Force, “Improvement of the Regulatory Framework,” theASEAN+3 Bond Market Forum ( ABMF ) was organized.
JASDEC participates in the ABMF as a representative ofJapan, and leads as a co-vice chair of Sub-Forum 2 under

ABMF, in which we discuss the standardization of thecross-border settlement process as a key topic.
Moreover, JASDEC, as a Japanese CSD, attends the
Cross-Border Settlement Infrastructure Forum ( CSIF ) under
Task Force 4, which is composed of each central bank and
CSDs.

- 32 -

International Relationships

Major International Activities
in FY 2015
April 13-14, 2015

August 18-19, 2015

• JASDEC participated in the 18th Meeting of the ABMF,
in which the opinions of participating institutions weresummarized to be compiled into the Phase 3 Report.

• JASDEC participated in the 19th meeting of the
ABMF and the 6th Meeting of the CSIF. The action
plan beyond Phase 3 was discussed.

May 3-4, 2015
• JASDEC contributed to the publication of the ABMF
Phase 3 Report and the CSIF Progress Report. The
summary was submitted at the ADB Annual Meetingand the jointly held ASEAN+3 Finance Ministers andCentral Bank Governors’ Meeting.

2015.45

6

7

8

May 20-22, 2015
• JASDEC participated in the 8th Board Meeting of the WFC held in Cancun,
Mexico. The WFC elected a new chairman and vice chairman. It was decided
that the WFC 2017 will be held in November 2017 in Hong Kong.
• JASDEC participated in the WFC 2015, also held in Cancun, Mexico.

May 12-13, 2015
• JASDEC participated in the 17th ACG Cross-Training Seminarin Colombo, Sri Lanka. As convener of the Exchange of Information
Task Force, JASDEC executed sessions introducing 43 of thelatest projects of participating institutions, and developed reports
upon conclusion of the Seminar. JASDEC also assisted the hostinstitution Central Depository Systems ( Pvt.) Limited ( CDS ) in
execution of the event. In addition, JASDEC gave a presentation on
the mechanism of its Book-entry Transfer System for Investment
Trusts.
- 33 -

9October 11-16, 2015

December 14-16, 2015

• JASDEC participated in the 9th Board Meeting of the WFC
held in Singapore. Among several issues, the status of theSingle Disclosure Project, which aims to create a world
database of CSD information by ensuring unified disclosureof the PFMI and response to the questionnaire from the
Association of Global Custodians was updated.

• At the request from Vietnam Securities Depository( VSD ), with which JASDEC has signed a MOU,JASDEC held a seminar on Japan’s investment trust
market geared toward the Depository and Vietnamese
financial institutions.

• JASDEC participated in Sibos2015 in Singapore. As theco-vice chair of ABMF’s Sub-Forum 2, JASDEC madepresentations in individual sessions introducing a wide
range of activities
of ABMF and CSIF.

• JASDEC also participated in the 20th Meeting of the ABMF
and the 7th Meeting of the CSIF.

10

11

12

2016.1

2

3

January 25-27, 2016
• JASDEC participated in the 21st meeting of the ABMF and the
8th meeting of the CSIF. Opinions from participating institutions
were collected in order to develop Progress Report to bepresented to the coming G7 Finance Ministers and Central Bank
Governors’ Meeting in May. In addition, validation of the crossboarder taxation was initiated.

November 4-5, 2015
• At the 19th AGM in Taipei, Taiwan, JASDEC planned and hosted panel discussions under the theme of CSD’s implementationof the PFMI, and explained its own information disclosure and risk management frameworks. Inauguration ceremony washeld by Korea Securities Depository ( KSD ) to commemorate the establishment of the Asia Fund Standardization Forum, aforum to study the standardization of post-trade processing of investment fund cross-border transactions. During theceremony, 12 member CSDs, including JASDEC, signed a statement of participation.

- 34 -

Consolidated Financial
Statements
Consolidated Balance Sheet ( As of March 31, 2016 )$1 = ¥ 112.68$ ( thousands )¥ ( thousands )

2016

2015

2016

ASSETS
Current Assets :Cash and deposits¥

7,416,046¥

9,990,817$

88,665

Accounts receivable - trade

3,521,010

3,584,792

31,813

Prepaid expenses

132,534

138,762

1,231

Deferred tax assets
Designated assets for clearing funds
OthersAllowance for doubtful accounts
Total Current Assets

151,054

165,900

1,472

38,949,709

38,543,855

342,064

4,202

1,947

17

( 6,868 )( 695 )

(6)

50,167,688

52,425,380

465,258

Non-current Assets :Property and Equipment :Buildings and accompanying facilities
Accumulated depreciation

845,681863,656

7,664( 471,276 )( 503,436 )( 4,467 )Buildings and accompanying facilities, net

374,404

360,220

3,196

Tools and furniture

3,677,415

3,663,272

32,510

Accumulated depreciation( 1,963,595 )( 2,517,625 )( 22,343 )Tools and furniture, net

1,713,819

1,145,647

10,167

Total Property and Equipment

2,088,224

1,505,867

13,364

Software

18,596,720

15,812,040

140,326

Software in progress

1,825,420

142,023

1,260

Intangible Assets :OthersTotal Intangible Assets

17,462

17,347

153

20,439,604

15,971,410

141,741

Investments and Other Assets :Investment securities

501,957--

Long-term prepaid expenses

100,096

90,936

807

Deferred tax assets

255,892

267,225

2,371

Long-term refundable lease deposits

402,737

443,791

3,938

Claims provable in bankruptcy, rehabilitation and other

17,603

15,341

136

OthersAllowance for doubtful accounts
Total Investment and Other Assets
Total Non-current Assets
Total Assets- 35 -

1,000

1,000

8

( 11,930 )( 9,848 )( 87 )

1,267,358

808,446

7,174

23,795,186

18,285,724

162,280¥ 73,962,874¥ 70,711,104$ 627,539

The accompanying consolidated financial statements

statements. Such U.S. dollar amounts are presented herein

expressed in Japanese yen are the translation of thosesolely for the convenience of readers outside Japan, and areissued domestically. The amounts expressed in U.S. dollars

not subject to audit.

are not included in the original audited consolidated financial¥ ( thousands )$ ( thousands )

2016

2015

2016

LIABILITIESCurrent Liabilities :Accounts payable - trade¥895,554¥

1,003,327

$

8,904

812

-

-

Accounts payable - other248,983

40,812362

Consumption taxes payable

759,343

363,950

3,229

Income taxes payable

732,686

841,302

7,466

Allowance for employees’ bonuses

238,456

230,135

2,042

Lease obligations

Allowance for executives’ bonuses

22,00022,000195

Deposits received for clearing funds

38,949,709

38,543,855

342,064

OthersTotal Current Liabilities

75,36580,123711

41,922,911

41,125,508

364,976

5,000,000--

582,597

657,324

5,833-

27,168241

Non-current Liabilities :Long-term loans payable
Liability for retirement benefits
OthersTotal Non-current Liabilities

5,582,597

684,493

6,074

Total Liabilities

47,505,509

41,810,001

371,050

4,250,000

4,250,000

37,717NET ASSETS
Shareholders’ Equity :Common stock
Capital surplus

4,250,000

4,250,000

37,717Retained earnings

17,957,365

20,401,102

181,053

Total Shareholders’ Equity

26,457,365

28,901,102

256,488

Total Net Assets

26,457,365

28,901,102

256,488¥ 73,962,874¥ 70,711,104$ 627,539

Total Liabilities and Net Assets- 36 -

Consolidated Financial
Statements
Consolidated Statement of Income and Comprehensive Income( For the year ended March 31, 2016 )¥ ( thousands )$ ( thousands )

2016

2015

2016

¥ 19,967,287¥ 20,945,566$ 185,885

Executives’ compensation

190,854

198,927

1,765

Salaries

2,027,032

2,011,642

17,852

Allowance for employees’ bonuses

238,456

230,135

2,042

Allowance for executives’ bonuses

22,00022,000195

Operating Revenue
Operating Expenses :136,157

141,828

1,258

Maintenance of systems

Retirement benefit expenses

6,261,277

6,171,744

54,772

Depreciation and amortization

5,834,273

5,960,019

52,893552,926

541,285

4,803

Rent
Others1,464,675

1,437,720

12,759Total Operating Expenses

16,727,654

16,715,302

148,343

Operating Income

3,239,632

4,230,263

37,542410Non-operating Income :Interest income
Operational revenue on designated assets for clearing funds

5,977

3,502

31

Equity in earnings of an affiliate

88,163

226,493

2,010

Registered members’ information disclosure claim charges

18,93015,814

140

-

3,159

28

11,165

10,672

94

124,240

259,6452,304Interest expenses

77,80323,003

204

Commitment fees

44,99945,123400

Fees for fund operation of designated assets for clearing fund

7,889

8,414

74

697

158

1

System-related income
OthersTotal Non-operating Income
Non-operating Expenses :OthersTotal Non-operating Expenses
Ordinary Income

131,390

76,699680

3,232,482

4,413,208

39,165Extraordinary Losses :Loss on sale of investment securities
Total Extraordinary Losses
Income before Income Taxes and Minority Interests-

13,955

123-

13,955123

3,232,482

4,399,252

39,041

Income taxes - current

1,146,079

1,471,693

13,060

Income taxes - deferred

20,732( 26,178 )( 232 )

Total Income Taxes
Net Income

1,166,812

1,445,515

12,8282,065,670

2,953,737

26,213

2,065,670

2,953,737

26,213( Details of Net Income )Net Income attributable to shareholders of the parent company
Net Income attributable to non-controlling interests-

Comprehensive Income--¥ 2,065,670¥

2,953,737$

26,213¥ 2,065,670¥

2,953,737$

26,213( Details of Comprehensive Income )Comprehensive income attributable to shareholders of the parent company
Comprehensive income attributable to non-controlling interests- 37 ---

Consolidated Statement of Changes in Net Assets ( For the year ended March 31, 2016 )¥ ( thousands )For the year ended

Shareholders’ Equity

March 31, 2015
CommonStockCapitalSurplusRetained
Earnings

Total
Shareholders’EquityTotal
Net Assets¥ 4,250,000¥ 4,250,000¥ 16,401,694¥ 24,901,694¥ 24,901,694

Dividends from surplus--( 510,000 )( 510,000 )( 510,000 )Net income attributable to shareholdersof the parent company--

2,065,670

2,065,670

2,065,670

Balance at the beginning of the period
Change during the period :--1,555,670

1,555,670

1,555,670¥ 4,250,000¥ 4,250,000¥ 17,957,365¥ 26,457,365¥ 26,457,365

Total change during the period
Balance at the end of the period¥ ( thousands )For the year ended

Shareholders’ Equity

March 31, 2016
CommonStockCapitalSurplusRetained
Earnings

Total
Shareholders’EquityTotal
Net Assets¥ 4,250,000¥ 4,250,000¥ 17,957,365¥ 26,457,365¥ 26,457,365

Dividends from surplus--( 510,000 )( 510,000 )( 510,000 )Net income attributable to shareholdersof the parent company--

2,953,737

2,953,737

2,953,737

Balance at the beginning of the period
Change during the period :--2,443,737

2,443,737

2,443,737¥ 4,250,000¥ 4,250,000¥ 20,401,102¥ 28,901,102¥ 28,901,102

Total change during the period
Balance at the end of the period$ ( thousands )Shareholders’ Equity
CommonStock
Balance at the beginning of the period$

37,717

Total
Shareholders’EquityTotal
Net Assets$ 159,366$ 234,800$ 234,800

CapitalSurplusRetained
Earnings$

37,717

Change during the period :Dividends from surplus--( 4,526 )( 4,526 )( 4,526 )Net income attributable to shareholdersof the parent company--

26,213

26,213

26,213

Total change during the period
Balance at the end of the period$

37,717$- 38 --

21,687

21,687

21,68737,717$ 181,053$ 256,488$ 256,488

Consolidated Financial
Statements

Consolidated Statement of Cash Flows ( For the year ended March 31, 2016 )¥ ( thousands )$ ( thousands )

2015

2016

2016

Cash Flows from Operating Activities :Income before income taxes and minority interests¥ 3,232,482

Depreciation and amortization¥

4,399,252$

39,041

5,834,273

5,960,019

52,893( Decrease ) increase in allowance for doubtful accounts( 9,988 )( 8,254 )( 73 )( Decrease ) increase in allowance for employees’ bonuses

29,350( 8,321 )( 73 )( Decrease ) increase in allowance for executives’ bonuses( 1,000 )--( Decrease ) increase in allowance for executives’ retirement benefits( 30,000 )--( Decrease ) increase in allowance for asset removal( 84,083 )--Increase ( decrease ) in liability for retirement benefits

71,72974,727

663

(4)

(1)

(0)

Interest income

77,80323,003204

Equity in ( earnings ) loss of affiliates( 88,163 )( 226,493 )( 2,010 )Foreign exchange losses ( gains )( 1,028 )

141

1

-

13,955123( Increase ) decrease in accounts receivable - trade( 349,943 )( 61,519 )( 545 )

Increase ( decrease ) in accounts payable - trade( 115,476 )

107,773956

Decrease / increase in consumption taxes receivable / payable

916,463( 395,392 )( 3,508 )Others( 11,593 )

16,761148

9,470,821

9,895,650

87,820Interest expenses

Loss on sale of investment securities

Sub-total

13,684

11,481

101

Interest paid

Interest and dividends received( 77,803 )( 23,003 )( 204 )

Income taxes paid

( 988,646 )( 1,387,291 )( 12,311 )

8,418,055

8,496,836

75,406Net Cash Provided by Operating Activities
Cash Flows from Investing Activities :Payments for purchase of property and equipment( 693,285 )( 41,111 )( 364 )

Payments for purchase of intangible assets( 1,694,749 )( 1,031,961 )( 9,158 )Proceeds from sale of investment securities
Proceeds from refund of refundable lease deposits
Payments for refundable lease deposits

703,0156,239-( 364 )-

( 41,054 )( 62,694 )--( 2,350,033 )( 411,111 )( 3,648 )( 4,400,000 )( 5,000,000 )( 44,373 )Payments for refund of guarantee deposits received
Net Cash Used in Investing Activities

100,696

Cash Flows from Financing Activities :Repayments of long-term loans payable( 5,880 )( 812 )

(7)

( 510,000 )( 510,000 )( 4,526 )( 4,915,880 )( 5,510,812 )( 48,906 )1,028( 141 )

(1)

Increase ( Decrease ) in Cash and Cash Equivalents

1,153,169

2,574,770

22,850Cash and Cash Equivalents, Beginning of Year

6,262,876

7,416,046

65,815

7,416,046¥ 9,990,817

Repayments of lease obligations
Cash dividends paid
Net Cash Used in Financing Activities
Effect of exchange rate changes on cash and cash equivalents¥

Cash and Cash Equivalents, End of Year- 39 -$

88,665

Corporate Data
( As of June 20, 2016 )Company Outline
Corporate NameJapan Securities Depository Center, Incorporated

Registered Office Address

1-1 Nihombashi-Kayaba-cho, 2-chome, Chuo-ku, Tokyo, Japan

Established

January 4, 2002

Representative

President and CEO Haruhiko Kato

Major Businesses

1Book-entry transfer for stocks, etc.

5

DVP settlement services for NETDs

2

Book-entry transfer for commercial papers

6

Pre-settlement matching system

3

Book-entry transfer for corporate bonds

7

Custody services for foreign stocks, etc.

4Book-entry transfer for investment trusts

8

Other businesses

Operational OfficeChuo-ku, Tokyo / Kita-ku, Osaka-shi, Osaka

Consolidated Subsidiary

JASDEC DVP Clearing Corporation ( Chuo-ku, Tokyo )Number of Employees

223

SharesTotal shares approved
for issue

Total issued shares

Paid-in capital

Shareholders

20,0008,500¥ 4,250,000,000

126

Major Shareholders
Number ofshares held

Stake inCompany (%)

Number ofshares held

Stake inCompany (%)

Japan ExchangeGroup, Inc.

2,073

24.38

Mitsubishi UFJ Trust andBanking Corporation

424

4.98

Japan Securities Dealers
Association

1,067

12.55

Daiwa Securities Co. Ltd.

360

4.23

Nomura Holdings, Inc.

485

5.70

Trust & Custody Services
Bank, Ltd.

340

4.00

The Bank ofTokyo-Mitsubishi UFJ, Ltd.

425

5.00

Citigroup Global Markets
Japan Inc.

321

3.77

Mizuho Bank, Ltd.

425

5.00

Japan Trustee Services
Bank, Ltd.

320

3.76

- 40 -

Corporate Data
( As of June 20, 2016 )Member of the Board and Executive Officers of JASDEC

Member of the Board
Director

Director

Haruhiko Kato

Munetaka Saito

Representative Executive officer,
President and CEO

Senior Executive Officer

Outside Director

Outside Director

Outside Director

Outside Director

Masatoshi Nozaki *Moriyuki Iwanaga

Jun Ohta

Masakazu Kubota *Chairperson of the Audit Committee( Full-time )Senior Executive Officer :Japan Exchange Group, Inc

Director :Sumitomo Mitsui Financial Group,Inc.
Senior Managing Directors :SumitomoMitsuiBanking Corporation

Director General :KEIDANREN( Japan Business Federation )Outside Director

Outside Director

Outside Director

Outside Director

Yasushi Takayama

Masahisa Nakagawa

Hideki Hiraki

Koichi Hirata

Senior Managing Director :Nomura Holdings, Inc.
Senior Managing Director :Nomura Securities Co., Ltd.

Executive Managing Director :Daiwa Securities Group Inc.
Executive Managing Director :Daiwa Securities Co. Ltd.

Senior Managing Executive Officer :Sumitomo Mitsui Trust Bank, Limited

Senior Executive Director :Japan Securities Dealers Association

Outside Director

Outside Director

Outside Director

Shigeyuki Maeda *Satoshi Murabayashi

Daisuke Yamada

LawyerManaging Executive Officer :Mitsubishi UFJ Financial Group, Inc.
Senior Managing Director :The Bank of Tokyo-Mitsubishi UFJ, Ltd.

Managing Executive Officer :Mizuho Financial Group, Inc.
Managing Executive Officer :Mizuho Bank, Ltd.

Member of the Board Committee

Executive Officers
Representative Executive officer, President and CEO

Nominating• Haruhiko Kato
• Koichi Hirata* Independent Directors

Haruhiko Kato
• Moriyuki Iwanaga
Senior Executive Officer ( Business Operations )Munetaka Saito
Audit• Masatoshi Nozaki• Shigeyuki Maeda

Senior Executive Officer ( Corporate Administration ), CRO• Hideki Hiraki

Hideki Kono
Senior Executive Officer ( Corporate Strategy )Compensation

Jun Sugie• Yasushi Takayama• Masakazu Kubota• Satoshi Murabayashi

Yoshinori Suzuki

Senior Executive Officer ( IT System ), CIO- 41 -

Organization Structure
Shareholders’ Meeting

Board of Directors
Nominating Committee
Compensation Committee
Audit Committee

Audit Committee Office

Risk Committee

President & CEO

Internal Audit Office[ Corporate Administration Group ]General Administration Department
Risk Management Department[ Corporate Strategy Group ]Corporate Strategy Department
Office of International Research and Relations

Executive Board[ Business Operations Group ]Book-entry Transfer Department

Executive Officers

Shareholders Notification Department
Post-Trade Services Department
Office of Business Requirements Definition[ IT System Group ]System Planning and Management Department
System Development Department
System Services Department- 42 -

History
1984
Relevant
Legislation

1985

1991

1992

2001

2002

2003

May 15th

Jun. 27th

Law Concerning Central Securities Depository
and Book-entry Transfer of Stock Certificatesand Other Securities [CSD Law] promulgated(effective Nov. 14th)

Law for Partial Amendments to the Law
Concerning Central Securities Depository andBook-entry Transfer of Stock Certificates andOther Securities as well as the Act on Transfer
of Short-term Bonds, etc. promulgated (fully
effective April 1st, 2002)

Jun. 12th
Act on Improvement, etc. of Laws Related to the Improvementof the Securities Market through a Reform of the Securities
Settlement System, etc. promulgated (Act on Transfer of
Short-term Bonds, etc. as amended to the Act on Transfer ofBonds, etc. and the Securities and Exchange Act amended
upon establishment of the clearing organization system)

Organization of
JASDEC and
its Subsidiary

Dec. 6th

Nov. 2nd

Japan Securities Depository Center (JASDEC)
established as a foundation

Detailed plan for conversation of JASDEC to a
joint-stock company announced

May 27th

Jan. 4th

JASDEC designated as a depositoryorganization under CSD Law

Japan Securities Depository Center, Inc. establishedJun. 17th
Japan Securities Depository Center, Inc. takes over all
depository and Book-entry transfer operators from the
JASDEC Foundation, which is dissolved.

Jan. 10th
JASDEC resolves official designation as a Book-entry
transfer institution under the stipulations of the Act on
Transfer of Bonds, etc.

Jun. 6th
JASDEC DVP Clearing Corporation [JDCC] established

Operation of
SystemOct. 9th

May 1st

Depository and Book-entry transfer
business starts (initially for 50 listed
stocks on the TSE)

JASDEC launches proprietary system for DVP
settlement of exchange trades

Oct. 9th
Computer system for depository andBook-entry transfer begins operation

Sep. 10th
Pre-Settlement Matching System (PSMS) starts

Nov. 26th
Handling of convertible bonds starts

Oct. 9th

Jan. 4th

Full-scale depository and Book-entry
transfer business starts

JASDEC launches Securities Information Tracing
System (SITRAS) for lost stocks

May 8thMar. 31st

New depository and Book-entry
Transfer System launched

JASDEC inaugurates Book-entry Transfer System for
Short-Term Corporate Bonds (Commercial Paper)- 43 -

2004

2005

2006

2007

2008

2009

2010

2014

2015

Jun. 9th

Jan. 5th

Law for Partial Amendments to the Act on Transfer ofBonds, etc. for the purpose of Streaming the Settlement
for Trades of Stocks and Other Securities (Securities Trade
Settlement Streaming Law) promulgated

Securities Trade Settlement Streaming Law enacted (theAct on Transfer of Bonds, etc. as amended to the Act on
Transfer of Bonds, Shares, etc.), and Law Concerning
Central Securities Depository and Book-entry Transfer ofStock Certificates and Other Securities abolished2016

Apr. 6th

Jul. 24th

JDCC obtains a license as a securities obligation
assumption business so it can act as a clearingorganization pursuant to the Securities andExchange Act

JASDEC adopts the structure of a Company
with Nominating Committee, etc.

Feb. 12th
Osaka Office establishedMay 17th

Jan. 4th

Jul. 1st

DVP Settlement for Non-Exchange
Transaction Deliveries (NETDs) starts

JASDEC inaugurates Book-entry Transfer
System for Investment Trusts

JASDEC inaugurates Japanese Depository Receipts
in Book-entry Transfer System for Stocks, etc.

Feb. 14th

Jan. 4th

Jan. 6th

JGB repo and gensaki (transactions with
repurchase agreement) added to the list oftargets of PSMSJASDEC inaugurates Book-entry Transfer
System for Investment Trusts on stock
exchanges for exchange-traded funds.

JASDEC launches new system introducing
ISO 20022-based format, tolerance matchingfor non-residents’ transactions, and DVP
settlements for stock lending transactions

Jan. 10th

Jan. 4th

JASDEC inaugurates Book-entry Transfer
System for Corporate Bonds

Operations of SITRAS terminates

May 1stJan. 5th

JASDEC inaugurates Custody Services for
Foreign Stock Certificates, etc.

JASDEC inaugurates Book-entry
Transfer System for Stocks, etc.

- 44 -

http://www.jasdec.com/en/

Daini-Shoken Kaikan Bldg., 1-1, Nihombashi-Kayaba-cho 2-chome, Chuo-ku, Tokyo 103-0025, JAPAN TEL +81-3-3661-0139