Performance Summary & Business Update FYE March 2019 May 2019 - - PowerPoint PPT Presentation

Performance Summary & Business Update FYE March 2019

May 2019

1

Contents

I. Performance Summary 2 II. Progress on Focused Project 10

• III. Business Environment and Our Actions

22

• IV. Capital Policy

31

* Unless otherwise specified, the numerical data we quote here were all compiled as consolidated figures of the Tokai Tokyo Financial Holdings, Inc.

• I. Performance Summary

3 ‐5,000 5,000 10,000 15,000 20,000 25,000 ‐10,000 10,000 20,000 30,000 40,000 50,000 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H FYE Mar 2013 FYE Mar 2015 FYE Mar 2016 FYE Mar 2017 FYE Mar 2018 FYE Mar 2019 (Million Yen） Operating revenue, Ordinary income Operating revenue Ordinary income Net Income Net income (Million Yen) 1,600 1,800 2,000 2,200 2,400 2,600 2,800 3,000 12,000 16,000 20,000 24,000

Nikkei 225 （LHS） SP500 （RHS）

Financial Results under Market Trend

¥11.16 billion gain of negative goodwill by acquiring Takagi Securities

(Yen)

(Point)

• I. Performance Summary

4

TTSC 38% FH + other Subsidiaries 13% JV6 companies +Ace 21% Dividend Income 27% ETERNAL ＆Mebius 1% *1 The charts present images of the Group’s revenue and income sources in FYE Mar 2019, which, unlike the consolidated P/L, include affiliates’ both figures

• n pro‐rata basis.

Retail Company 35% Wealth Management 4% Next Generation Business 3% Corporate Finance 2% Corporate Sales 5% Market & Products 24% Other 2%

Takagi Securities 6% ETERNAL ＆Mebius 3% FH + other Subsidiaries 3% JV6 companies +Ace 13%

TTSC 75%

【Retail Segment】 42% 【Non‐retail Segment】 33%

Analysis of Revenue and Income Sources – How Are We Earning?

Breakdown of operating revenue sources including the affiliates’ figures on pro‐rata basis*1

(FYE March 2019, operating revenue 64,772 Million Yen)

Breakdown of ordinary income sources including the affiliates’ figures on pro‐rata basis*1, 2

(FYE March 2019, ordinary income 932 Million Yen )

*2 Figures of Takagi Securities are excluded from this chart due to their ordinary losses.

• I. Performance Summary

5

Structured bonds Business Environment and Negative Factors in FYE March 2019

US equity

• I. Performance Summary

Japan equity

Capital market unrest

Turnaround delay at the acquired companies

‐ Takagi Sec. ‐ ETERNAL ‐ Pinnacle

Fund Investment Advance investment

‐ FinTech ‐ Office relocation (Orque d’or Salon Tokyo, Tokyo HQ of Retail Div., Market Div.)

6 （百万円）

• I. Performance Summary

(Million Yen) 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Total revenues

16,874 17,890 20,346 18,567 73,679 15,374 15,413 12,463 12,700 55,952 Retail Segment 10,300 10,085 11,890 10,721 42,996 8,943 8,061 6,670 7,445 31,119 Market & Products 5,126 6,070 6,774 6,235 24,204 5,070 5,587 3,861 3,346 17,864 Corporate Sales & Corporate Finance 934 910 1,129 963 3,936 961 1,045 1,439 1,056 4,501 Institutional Sales 255 259 278 292 1,085 274 280 345 289 1,188

Financial expenses

813 713 860 694 3,081 797 695 715 720 2,928

Total SG&A expenses

12,381 13,026 13,285 13,185 51,878 13,099 12,854 12,755 12,495 51,204 Trading‐related expenses 2,513 2,722 3,080 2,723 11,039 2,569 2,415 2,417 2,179 9,581 Personnel expenses 4,366 4,813 4,740 4,877 18,797 4,591 4,629 4,517 4,441 18,181 Real estate expenses &

• ffice cost & depreciation

3,713 3,801 3,739 3,819 15,073 3,731 3,717 3,760 3,756 14,964 Other 1,787 1,688 1,725 1,765 6,967 2,207 2,092 2,058 2,116 8,476

Ordinary income

3,811 4,284 6,307 4,788 19,192 1,598 1,982 ‐898 ‐432 2,250

FYE March 2018 FYE March 2019

Ordinary income of Tokai Tokyo Securities over the 2 fiscal years

* Excluding costs for the office relocation effective Jan 2019

Analysis

7

Ordinary income of Takagi Securities, and other subsidiaries & affiliates over the 2 fiscal years Advance investments effect over the 2 fiscal years

* Ordinary income of joint ventures securities companies multiplied by our shareholding ratio (40%) *1 Sum of equity method investment profit & loss, and amortization of goodwill for Money Design *2 Sum of ordinary income and amortization of goodwill for Eternal etc.

（百万円） （百万円）

• I. Performance Summary

(Million Yen) 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total Money Design *1

‐ ‐ ‐ ‐ ‐ ‐ ‐149 ‐180 ‐187 ‐517

ETERNAL etc. *2

‐65 ‐116 ‐62 53 ‐194 ‐181 ‐122 19 ‐11 ‐296

Subtotal

‐65 ‐116 ‐62 53 ‐194 ‐181 ‐271 ‐161 ‐198 ‐813

Office relocation costs (Real estate expenses and depreciation)

‐ ‐ ‐332 ‐332 ‐579 ‐1,244

Total

‐65 ‐116 ‐62 53 ‐194 ‐181 ‐603 ‐493 ‐777 ‐2,057

FYE March 2018 FYE March 2019 (Million Yen) 1Q 2Q 3Q 4Q Total 1Q 2Q 3Q 4Q Total (Ordinary income) Takagi Securities

‐393 ‐390 142 12 ‐628 ‐117 ‐270 ‐545 ‐498 ‐1,432

Six joint venture securities companies*

428 440 820 523 2,213 358 196 ‐93 ‐144 317

Other subsidiaries and affiliates

190 219 335 322 1,067 145 153 ‐676 322 ‐52

Total

225 269 1,297 857 2,652 386 79 ‐1,314 ‐320 ‐1,167

FYE March 2018 FYE March 2019

Analysis

8

• I. Performance Summary

TTSC – Revenue Breakdown by Retail and Non‐Retail Divisions

1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H

Retail Division 5,887 3,347 3,926 3,167 1,390 1,113 1,321 1,103 4,425 4,795 1,378 1,694 Market Division 3,966 1,897 809 1,193 5,439 4,355 3,966 4,048 ‐ ‐ 442 395 from JVs 844 426 235 180 3,005 2,167 3,005 2,167 ‐ ‐ ‐ ‐ 2 722 322 762 666 294 323 205 268 843 1,210 Total 9,853 5,246 5,457 4,682 7,591 6,134 5,581 5,474 4,630 5,063 2,663 3,299

Mutual Funds Other

Foreign & Structured Bonds

Corporate Sales Division & Investment Banking Division

FYE March 2019

(Million Yen)

Foreign Equities Japan Equities Bonds

9

26,951 29,350 27,588 26,04426,111 28,117 27,270 28,942 27,460 27,294 31,909 33,562 31,647 31,296

5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H 1H 2H FYE Mar 2015 FYE Mar 2016 FYE Mar 2017 FYE Mar 2018 FYE Mar 2019 FYE Mar 2018 FYE Mar 2019 (Million Yen)

Operational expenses (Variable) System expenses (Variable) Trading‐related expenses (Variable ‐JV) Trading‐related expenses (Variable‐

• thers)

Personnel expenses (Variable) Other Depreciation Trading‐related expenses (Fixed) Occupancy and rental Operational expenses (Fixed) System expenses (Fixed) Personnel expenses (Fixed) Total

Analysis of Variable and Fixed Costs – Consolidated Basis

Personnel expenses increased due to consolidation of group companies Variable cost Fixed cost

• I. Performance Summary

Excluding Takagi Securities, ETERNAL & Pinnacle

* Excluding data transfer expenses (office cost) for branch transfers to joint venture securities companies in 2Q and 4Q of FYE Mar 2018

• II. Progress on Focused Projects

11

• II. Progress on Focused Projects

(Million Yen) FYE Mar 2018 FYE Mar 2019 For the 5 months ending Aug 2019 (Projection) Operating revenue

6,325 4,204 1,500

SG&A expenses

7,117 5,739 2,500

Ordinary income

‐628 ‐1,432 ‐1,000

First Sales Headquarters

518 ‐421

Second Sales Headquarters

‐548 ‐697

Toshin no Madoguchi (Mutual fund speciality store)

‐1,110 ‐642

Extraordinary income & loss and tax expense

467 1,185 ‐50

Gain on sales of investment securities (consolidated)

782 663

Amortization

‐516 ‐137 ‐50

Allowance for employee retirement benefits

‐153 ‐598

Other

‐6

Tax effect

360 1,256

Gain on bargain purchase

11,160

Merger related system costs incurred at TTSC

‐738

Profit contribution for the Group

10,999 ‐248 ‐1,788 8,964

Takagi Securities

12

Business commencement June 3 (Mon.), 2019 AUM

(as of the end of March 2019)

JPY100B to be split from TTSC

• No. of accounts

(as of the end of March 2019)

10,000 A/C to be split from TTSC Value of split business JPY3.5B (JPY2B as extraordinary income）

• No. of employees

(including employees from TTFG)

109（56） Branches

HQ, Ohgaki, Tajimi, Nakatsugawa

• II. Progress on Focused Projects

Juroku TT Securities

13

Market Division (TTSC)

Breakdown by customer flow source Revenue breakdown by operational category

• II. Progress on Focused Projects

5,831 8,322 9,265 10,653 8,652 6,553 2,078 2,962 1,928 2,355 2,006 1,289 201 139 165 124 ‐43 ‐38 8,110 11,423 11,358 13,132 10,615 7,804

‐2,000 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 1H 2H 1H 2H 1H 2H FYE Mar 2017 FYE Mar 2018 FYE Mar 2019 Fund Revenue Position Revenue Customer Revenue Flow (Million Yen) Total

2,508 3,471 3,962 4,038 3,143 2,924 3,322 4,846 5,304 6,516 5,396 3,428 97 111 199 5,831 8,322 9,265 10,653 8,652 6,553

2,000 4,000 6,000 8,000 10,000 12,000

1H 2H 1H 2H 1H 2H FYE Mar 2017 FYE Mar 2018 FYE Mar 2019 Other Takagi, JVs & PF TTSC

(MillionYen)

Total

14

• II. Progress on Focused Projects

Strengthening Market Division

Strengthen foreign equity products Global trading Equity business In-house

• rigination
• f structured

bonds JGB electronic transactions Upgrade trading system & reinforce staff

【Progress in FYE March 2019】 Target / Plan In‐house origination of structured bonds: 30% 50% Enhance private fund business tailored to private investors: Matching system upgrade done Establish the system for TTAM to handle the volume of Y100Billion Enhance derivative business: Intensified approach made to regional banks Uninterrupted approach Equity business: Commenced MS warrant and CB Approach to companies with financing needs Recruitment: 30 Professionals joined (including 14 for system) Continuous recruiting for system and fixed income trader Position size: Enlarged Further climb to upper tier player JGB: Electronic trading (front) system introduced Expand flows from institutional investors Improvement of infrastructure: Financial accounting system improved Consider establishing market valuation management dep. Global Trading: Organization established Strengthen risk management New financing scheme proposal for collaborated financial firms: Scheme developed Marketing to regional banks, inst. investors and securities cos.

Enhancing the division’s infrastructure Product diversification

Targeting Revenue ¥3Billion/Month

15

‐554 389 526 636 1,410 2,570 2,568 1,431 1,073 2,317 414 465 1,041 1,325 1,636 2,434 3,031 3,996 3,464 3,783 5,603 4,242 ‐89 1,430 1,851 2,272 3,844 5,601 6,564 4,895 4,856 7,919 4,656

‐1,000 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 FYE Mar 2009 FYE Mar 2010 FYE Mar 2011 FYE Mar 2012 FYE Mar 2013 FYE Mar 2014 FYE Mar 2015 FYE Mar 2016 FYE Mar 2017 FYE Mar 2018 FYE Mar 2019 (Million Yen) Income and Other Benefits Realized from Transactions with JVs Gain on Investments in Partnership Total

1,876 1,601 1,363 1,720 2,103 2,530 2,004 1,484 1,503 1,292 1,568 1,871 2,035 2,330 2,274 1,166 15 11 5 37 16 13 32 26 4,041 2,263 2,481 4,104 4,773 6,381 4,510 3,245 3,903 3,216 2,695 3,596 3,712 3,956 3,152 2,560 99 251 29 110 70 125 207 124 11,438 8,635 8,142 11,437 12,709 15,335 12,180 8,605

2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 1H 2H 1H 2H 1H 2H 1H 2H FYE March 2016 FYE March 2017 FYE March 2018 FYE March 2019

Other Mutual Funds Foreign & Reverse Convertible Bonds Domestic Bonds Foreign Equities Japan Equities (Million Yen) Total

Benefit from Alliance with Regional Banks

Assets under custody ‐ from JVs (6 entities) Income contribution from JVs (6 entities) Product revenue ‐ from JVs (6 entities)

• II. Progress on Focused Projects

5 245 371 540 642 780 884 1,047 998 1,244 1,450 1,424

200 400 600 800 1,000 1,200 1,400 1,600 Mar‐08 Mar‐09 Mar‐10 Mar‐11 Mar‐12 Mar‐13 Mar‐14 Mar‐15 Mar‐16 Mar‐17 Mar‐18 Mar‐19 (BillionYen)

16

Regional banks JV securities companies Finance scheme New scheme Asset management

TTAM・privately placed fund for professional investors Money Design Fund wrap ANAM

Business succession /debt fund

Pinnacle TT Solution

Insurance shop High‐net‐worth Orque d’or Salon TOKYO Asset Management Platform On‐line trading Service Financing function Securities loan

• II. Progress on Focused Projects

Functions to Be Enhanced on Great Platform

17

25 25 26 29 31 34 41 35 50 49 51 72 86 95 115 102 45 37 39 59 59 81 99 60 3 7 9 8 122 112 117 160 181 219 266 207

50 100 150 200 250 300

1H 2H 1H 2H 1H 2H 1H 2H FYE March 2016 FYE March 2017 FYE March 2018 FYE March 2019

Takagi TTSC Broker's Broker Business JV （Billion Yen） Total 616 497 527 894 1,039 1,205 1,295 627 1H 2H 1H 2H 1H 2H 1H 2H FYE March 2016 FYE March 2017 FYE March 2018 FYE March 2019 200 400 600 800 1,000 1,200 1,400 (MillionYen)

Assets under custody (foreign stocks) Assets under custody & number of clients Revenue

• II. Progress on Focused Projects

62,104 56,759 59,712 80,805 81,411 101,036 121,103 82,238 45 46 47 50 53 57 58 61 5 10 15 20 25 30 35 40 45 50 55 60 65 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 1H 2H 1H 2H 1H 2H 1H 2H FYE March 2016 FYE March 2017 FYE March 2018 FYE March 2019

Assets under Custody（LHS:Million Yen） Number of Client（RHS） Number of Client (Million Yen)

Broker’s Broker Business

18

High Wealth 17.0% Wealth 31.4% Middle 43.0% General 6.4% Non‐face‐ to‐face 2.2%

High Wealth 26.2% Wealth 23.7% Middle 33.4% General 7.1% Non‐face‐ to‐face 9.6%

General :Holding less than 5 million yen Middle :5 million to 30 million yen Wealth :30 million to 100 million yen High Wealth :Over 100 million yen in assets under custody

High Wealth 6.5% Wealth 25.9% Middle 56.1% General 11.4%

High Wealth 14.4% Wealth 24.3% Middle 46.5% General 14.8%

Assets under custody breakdown by customer segment

Mar 2013

Mar 2019

Revenue breakdown by customer segment

FYE Mar 2013

FYE Mar 2019

Revenue breakdown by sales channel

• II. Progress on Focused Projects

1,012 850 874 1,161 1,168 1,304 1,526 1,434 596 498 433 553 505 532 415 390

21,270 17,369 15,441 18,949 18,712 20,776 15,064 12,293

5,000 10,000 15,000 20,000 25,000

1H 2H 1H 2H 1H 2H 1H 2H FYE Mar 2016 FYE Mar 2017 FYE Mar 2018 FYE Mar 2019

（Million Yen) Wealth Management One Stop Channel Retail Sales

Retail and High‐Net‐Worth Business (TTSC)

19

• 60.5%
• 58.7%
• 53.9%
• 51.7%
• 51.7%
• 52.1%
• 51.7%
• 48.5%
• 14.2%
• 24.9%
• 24.9%
• 17.2%
• 32.4%
• 25.5%
• 30.6%
• 16.8%
• 70.0%
• 60.0%
• 50.0%
• 40.0%
• 30.0%
• 20.0%
• 10.0%

Jun 2011 Mar 2012 Mar 2013 Mar 2014 Mar 2015 Mar 2016 Feb 2017 Jan 2018

TTSC Wealth Management

Revenue per head

(Million Yen)

FYE Mar 2018 2H FYE Mar 2019 1H FYE Mar 2019 2H

Wealth 24 21 15 Retail 19 13 9 Next Generation 10 8 6

• II. Progress on Focused Projects

105 178 203 246 267 265 240 74 74 2,951 3,124 3,536 3,995 4,192 4,815 4,371 100 200 300 400 500 600

Mar 2016Sep 2016Mar 2017Sep 2017Mar 2018Sep 2018Mar 2019 AUC－Orque d'or(Tokyo) AUC－Orque d'or(Nagoya) AUC－Wealth Management Division (Billion Yen) 679 1,024 1,171 1,290 1,361 2,049 （including 623 from Tokyo） 2,119 (including 684 from Tokyo) Number of Membership

Net promoter score

High‐Net‐Worth Business

Assets under custody (AUC) of Orque d’or and Wealth Management Division

20

Productivity revolution

Professionality Humanity

 Abolish seniority-based wage system  Reduce excessive dependence

• n generalist

 Establish ideal personnel and the related expenditure Talent & performance as professional Salary Position/role

interaction

Headquarters & Administrative roles

Sales Data-base marketing Rationalization

• f outlets and

administration BPR

(RPA, Operation improvement)

Paperless, ICT

 Maximize

• utput and

earnings  Minimize resource and cost allocations

• II. Progress on Focused Projects

Personnel revolution

Revolution of Productivity and Personnel Resource

21

Productivity revolution Cultivate high‐net‐worth clients Absorption of Takagi Sec. Reduce fixed property cost Improve fund investment performance Performance improvement

• f JVs

Strengthen Market Div. Performance improvement

• f ETERNAL, etc.
• II. Progress on Focused Projects

Major Actions to Enhance Profitability

• III. Business Environment and Our Actions

23

Diversifying customer needs Market fluctuation Workstyle reform Substantial cost Digitalization Fiduciary duty 6 problems

• III. Business Environment and our Actions

Change in Business Environment

24

Finance, etc. Productivity revolution High‐net‐worth Special account Market‐oriented ＪＶ IFA network Great Platform

• III. Business Environment and Our Actions

8 Big Actions for Increasing Profit

Special account High‐net‐worth Matured segment Asset forming segment

Advantage Consultancy Core satellite Integrated corporate and retail

• perations

Sales/marketing method

Portfolio consultant Life plan consultant Segmented strategy

25 Integrated corporate and retail

• perations

Consulting Product Sense of Richness Human Resource Development System infrastructure Life support Non‐Stop Sales 365 days a year Efficient marketing Digitalization Wholesale Marketing to the Employees

• f Targeted

Companies Goal‐based Sweep, point Non‐Stop Sales 365 days a year

‐ Loan, insurance ‐ Subscriptions ‐ Wrap accounts ‐ Special price ‐ Organizing Events ‐ Orque d’or ‐ Event, seminar ‐ Concierge ‐ Original investment ‐ Loan, insurance ‐ Wrap accounts ‐ Portfolio ‐ Tax, succession ‐ Real estate, M&A ‐ Medical

• III. Business Environment and Our Actions

Sales and Marketing for Retail Segment

200 400 600 800 1,000 1,200 1,400 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000

Margin trading accounts

建玉 残有顧客数

Margin trading positions (Million Yen) Number of active accounts

26

• III. Business Environment and Our Actions

Margin trading positions Number of active accounts

Special Accounts

27

Tokai Tokyo Financial Group Functions to be added in Great Platform

Asset Management Platform

IFA etc.

TTSC

Investment support Hokuhoku FG Tochigi Bank Yamaguchi FG Yokohama Bank Nishi-Nippon City Bank Senshu Ikeda Bank Juroku Bank Others Asset management program Point giveaway program Financial activity Diagnosis SNS Life support ライフプラン サポートツール Collaboration with regional banks

Financial information Brokerage Diagnosis / consulting Point giveaway Coupon SNS

Existing functions Bank function Online Sec.

• III. Business Environment and Our Actions

New Business on Great Platform

New functions

28 Tokai Tokyo Securities 65 outlets Tochigin TT

(7 operating outlets) (7 operating outlets)

YM Securities Nishi‐Nippon City TT

(19 operating outlets) (19 operating outlets)

Hamagin TT

(17 operating outlets)

Senshu Ikeda TT (As of April 1, 2019)

(5 operating outlets)

Hokuhoku TT

f.k.a. Utsunomiya Securities

• III. Business Environment and Our Actions

Takagi Sec.

Juroku TT

(Starting business from June 3, 2019 with 4

• utlets)

・ Cultivation of corporate market ・ Cultivation of high‐net‐ worth market ・ Performance stabilization ・ Operating efficiency upgrading

Concordia FG ¥15.49Trillion Hokuhoku FG ¥11.45Trillion Yamaguchi FG ¥9.28Trillion Nishi‐Nippon ¥8.66Trillion Juroku Bank ¥5.61Trillion Senshu Ikeda HD ¥4.98Trillion Tochigi Bank ¥2.71Trillion Deposit at collaborative regional banks

(As of Dec. 2018)

Actions to be taken by JVs

(12 operating outlets)

Regional Bank Network

29 Tokai Tokyo Sec.

Tokai Tokyo Sec.

Tokai Tokyo Sec.

Past

Broker Retail (Matured Segment) Equity Investment Trust

Present Hereafter: Comprehensive Financial Group

JV

Hokuhoku Tochigin YM Hamagin Nishi‐Nippon Senshu Ikeda Market & Corporate Investment Banking

IFA

Financial Instruments Intermediary FP CPA Insurance Agency Mobile Carrier GMS Others High‐net‐worth Market & Corporate Matured Investment Banking

JV

Hokuhoku

Tochigin YM Hamagin

Nishi‐Nippon

Senshu Ikeda

Peer Medium Securities Companies

Juroku Others High‐net‐worth Retail Matured

TT Online (FinTech)

New Generation Small Investment Robo‐advisor Digital marketing Smartphone

Peer Medium Securities Companies

• III. Business Environment and Our Actions

Banking function

Digital Payment Loan

Asset management

Product design Management

Great Platform

New Business Model

30

Productivity Revolution Personnel system revolution Market Div. targeting JPY3B/month Segmented retail business ‐ High‐net‐worth ‐ Matured ‐ Next Generation Great Platform ‐ JV securities companies ‐ Peer mid‐sized brokers ‐ IFA

• III. Business Environment and Our Actions

Key Factors

Key Goal Indicators of on‐going mid‐to‐long term management plan

Ordinary income ROE AUM ¥30Billion 10% ¥10 Trillion

• IV. Capital Policy

32

3.7 2.7 3.2 4.5 2.6 4.2 4.5 2.9 3.8 5.2 3.3 4.1 4.0 1.5 4.0 1 2 3 4 5 6

FYE Mar 2015 FYE Mar 2016 FYE Mar 2017 FYE Mar 2018 FYE Mar 2019

(%) 12.6 8.6 12.8 8.1 4.9 9.5 7.8 8.7 8.4 15.5 7.9 8.8 0.6 ‐3.7 5.1 ‐10 10 20 30 (%) 69.5 61.7 87.1 46.9 36.5 68.3 45.7 67.3 61.5 97.3 63.1 66.9 4.2 ‐29.9 40.0 ‐50 50 100 150 (Yen)

Tokai Tokyo Nomura Daiwa * EPS and ROE are annualized

EPS ROE Dividend Yield

Dividend information of TTFH Indicator per share in comparison with peers

Mar 2015 Mar 2016 Mar 2017 Mar 2018 Mar 2019 Shareholders' Equity (million yen) 154,633 153,089 155,312 172,629 161,491 Treasury Stock 3,639 6,390 7,572 6,188 6,183 Dividend per Share (yen) 34.00 28.00 26.00 38.00 16.00 Dividend Payout Ratio 48.9 % 59.7 % 56.9 % 39.1 % 382.8 % DOE (Dividend On Equity ratio) 6.1 % 4.8 % 4.4 % 6.0 % 2.5 %

Per Share Indicators in Comparison with Peers

• IV. Capital Policy

33

Shareholder return Reserved capital for future growth

‐ Dividend

(Dividend policy: continue stable payment while taking into account such factors as 1) basic target payout ratio of 30 to 50%, 2) the interest rates on Japanese Government Bonds and 3) the level of dividend yield to be achieved, with a view to encouraging the shareholders to possess the Company’s shares for mid-to-long term period.

‐ Share buyback ‐ Benefit program Investment in IT/AI M&A / Capital investment (Bank, broker, FinTech) Business expansion (Market div., high‐net‐worth, IFA)

• IV. Capital Policy

Shareholder Return & Reserved Capital

34

MEMO

Inquiries to be directed to:

Effective April 1, 2009, the Company spun off its financial instrument operation and Tokai Tokyo Security Co.,

• Ltd. (former Tokai Tokyo Securities Spin‐off Preparation Co., Ltd.) took it over. The Group (Tokai Tokyo Financial

Group) at the same time shifted to a holding company system. Effective the same date, the Company and Tokai Tokyo Securities Spin‐off Preparation Co., Ltd. changed their corporate names to Tokai Tokyo Financial Holdings, Inc., and Tokai Tokyo Securities Co., Ltd. respectively. The result for the fiscal year ended on March 31, 2009 or any earlier date account for the operation of the former Tokai Tokyo Securities Co., Ltd. under then existing organizational structure.

• Corporate Communications Department
• Phone: +81‐3‐3517‐8618 FAX: +81‐3‐3517‐8314
• E‐mail: fh_ir@tokaitokyo‐fh.jp

 This material is intended to provide information regarding the Company’s most recent operational result and NOT to solicit investment in securities issued by the Company.