Attention
This is an unofficial translation of the press release announced on March 10, 2020 by Daiwa Securities
Group Inc. The original press release is in Japanese.
March 10, 2020Press Release
Daiwa Securities Group Inc.

Notice Regarding the Issue of Daiwa Securities Group Inc.’s Unsecured Perpetual
Subordinated Bonds with Write-down Clause
Daiwa Securities Group Inc. (the “Company”) hereby announces that the Company has decided to issue
unsecured perpetual subordinated bonds with write-down clause as set forth below. The bonds will bequalified as the Company’s Additional Tier1 capital under the current applicable capital adequacy
requirements.

Issue Amount
Method ofOffering
Denomination
Amount to be
paid

Daiwa Securities Group Inc. first series of

Daiwa Securities Group Inc. second series of

unsecured perpetual subordinated bonds with

unsecured perpetual subordinated bonds with

optional-redemption clause and write-down clauseoptional-redemption clause and write-down clause

JPY 125 billion

JPY 25 billion

Public offering in JapanJPY 100 million
JPY 100 per face value of JPY 100None

None

Provided, however, that the Company may, at its

Provided, however, that the Company may, at its

discretion, redeem the bonds on any interest

discretion, redeem the bonds on any interest

Redemption

payment date on June 5, 2025 or thereafter (unlesspayment date on June 5, 2030 or thereafter (unlessDate

the principal amount of the bonds has been written

the principal amount of the bonds has been written

down upon the occurrence of a loss absorption

down upon the occurrence of a loss absorption

event) or upon the occurrence of a tax event or aevent) or upon the occurrence of a tax event or acapital event.

capital event.

From the day immediately following March 16,

From the day immediately following March 16,2020 until June 5, 2025 : 1.20％ per annum2020 until June 5, 2030 :1.39％ per annum

From the day immediately following June 5, 2025 :From the day immediately following June 5, 2030 :6-month euro-yen LIBOR＋1.40％

6-month euro-yen LIBOR＋1.50％

Interest Rate

Interest
Payment Dates
Subscription
PeriodPayment Date

June 5 and December 5 of each year
March 10, 2020
March 16, 2020
(1) Optional cancellation of interest payments

Summary ofThe Company, at its discretion, may cancel all or part of the interest payments on the bonds when it

Interest

deems necessary, in which case the Company shall not make any resolutions at its board of directors

Cancellation

to pay dividend payments to shareholders as of the immediately preceding record date of dividend

Clausepayment.
(2) Interest payable amount limitation

The amount of interest payable on any interest payment date on the bonds shall not exceed bonds inexcess of the Interest Payable Amount.
The “Interest Payable Amount” will be calculated by dividing the adjusted distributable amount,which will be the distributable amount under the Companies Act as of the interest payment date lessthe total amount of interest and dividends of the bonds, the Parity Securities and the Junior
Securities paid on any day and following the beginning of the fiscal year in which such interest
payment date falls and preceding the interest payment date, on a pro rata basis among the amount ofinterest payable under each bond and each amount of interest or dividends payable on the sameinterest payment date under each Parity Security.
The “Parity Securities” are obligation of the Company which effectively rank pari passu in terms of (1)and (2) as above as to interest payment with the bonds.
The “Junior Securities” are obligation of the Company which effectively rank junior in terms of (1) or(2) as above as to interest payment with the bonds
The amount of interest which have not been paid pursuant to (1) or (2) as above shall not be accrued andpayment obligation thereof shall be discharged thereafter.
(1) Write-down upon the occurrence of a loss absorption event
When the Company’s consolidated Common Equity Tier1 capital ratio falls below 5.125%, theprincipal amount of, and the corresponding amount of interest on, the bonds shall be written down tothe extent necessary, as determined by the Company in consultation with the Financial Services
Agency of Japan and other relevant Japanese governmental organizations, to make the Company’s
consolidated Common Equity Tier1 capital ratio exceed 5.125% by write-down or conversion toSummary ofordinary shares of all or part of the bonds and its other Additional Tier1 liabilities, etc. on a pro rata

Write-downbasis.

Clause(2) Write-down upon the occurrence of a non-viability event
The principal amount of and interest on the bonds shall be written down to zero when it is confirmedthat the “specified item 2 measures (tokutei dai nigou sochi),” which are the measures set forth in theDeposit Insurance Act, need to be applied to the Company.
(3) Write-down upon the occurrence of an insolvency proceedings commencement event
The principal amount of and interest on the bonds shall be written down to zero when it is adjudicatedthat the Company becomes subject to bankruptcy and other insolvency proceedings.
When the principal amount of the bonds have been partially written down upon the occurrence of a loss
absorption event, such principal amount of the bonds shall be reinstated upon the occurrence of a
Reinstatement Event to the extent of the amount to be determined by the Company after discussion with

Summary of

the Financial Services Agency of Japan and any other relevant Japanese governmental organizations.

Reinstatement

The “Reinstatement Event” occurs when the Company determines that the principal amount of the bonds

Clausethat have been written-down be reinstated after prior confirmation of the Financial Services Agency ofJapan and any other relevant Japanese governmental organizations that the Company’s consolidated
Common Equity Tier1 capital ratio remains at a sufficiently high level immediately after giving effect tothe relevant reinstatement of the bonds.

Summary ofSubordination
ClauseUse of Proceeds
Fiscal Agent
Securities
Depository
Rating

The bonds rank, as to the payment of liabilities in our liquidation proceedings (excluding special
liquidation proceedings), junior to the general creditors and dated subordinated creditors of the Company,
and senior to the Company’s shares except for the Company’s preferred shares which are the mostpreferred in terms of distribution of residual asset.
The net proceeds from the offering of the Bonds will be used for redemption of other bonds and for loans
to consolidated subsidiaries.
Sumitomo Mitsui Banking Corporation

Mizuho Bank, Ltd.

Japan Securities Depository Center, Incorporated
BBB+ : Japan Credit Rating Agency, Ltd.

End