Japan Securities Finance Co., Ltd. · TSE:8511
Japan Securities Finance — Q1 FY2009 Earnings Presentation
34 slides from Japan Securities Finance's earnings presentation, April 2009
Slide 1: Financial Presentation for 1Q, FY2009
Financial Presentation for 1Q, FY2009 Japan Securities Finance Co.,Ltd This document is the English translation for non-Japanese investors convenience. Although Japan Securities Finance intend to faithfully translate the Japanese documents into English, the accuracy and correctness of translation ar
Slide 2: Financial Summary
a Financial Summary
Slide 3: Financial Summary FY2009, 1Q
Financial Summary FY2009, 1Q ¥ mil Parent Consolidated FY2008 FY2009 FY2008 FY2009 Change Change 1Q 1Q 1Q 1Q Operating ▲2,025 ▲2,684 Revenues 8,462 6,437 (▲23.9%) 10,981 8,296 (▲24.4%) EX Premium ▲1,861 ▲2,521 Charges 6,463 4,602 8,983 6,462 (▲28.8%) (▲28.1%) Operating Expenses 5,561 3,301 ▲2,260 7,
Slide 4: Operating Revenues by Each Business
Operating Revenues by Each Business \ mil Jun-08 Jun-09 Margin Loan Business 4,410 3,766 (40.2%) (45.4%) 【Margin Loan】 【Margin Loan】 Interest on Loans 1,283 730 Interest on collateral money of securities ・As margin ・As margin loan loan balance balance declined declined and and margin margin loan loa
Slide 5: Financial Highlights for FY2009, 1Q
Financial Highlights for FY2009, 1Q 1 As As the the outstanding outstanding balanced balanced of of standardized standardized margin margin buying buying transactions transactions declined, declined, Margin Margin Loan Loan Balance Balance decreased. decreased. Avg. Margin Loan Balance for FY2009, 1
Slide 6: Financial Highlights for FY2009, 1Q
Financial Highlights for FY2009, 1Q 4 Change Change in in scope scope of of Equity-method Equity-method companies companies Following the business reorganization of JBIS group, JSF change the range of Equity-method companies. Newly, JBIS Holdings (consolidated) and JSFIT is adopted as Equity-method,
Slide 7: Avg. Outstanding Balance of Margin Loans and Stock Loans
Avg. Outstanding Balance of Margin Loans and Stock Loans Margin Loans(left) Stock Loans(left) Margin Loan Rate(right) \tri 1.5 3.0% FY2007 (Result) Margin Loan: \ 917 bn Stock Loan : \ 591 bn 1.3 1.0 2.0% FY2008 (Result) Margin Loan: \ 336 bn Stock Loan : \ 396 bn 0.8 FY2009, 1Q (Result) Margin Loan
Slide 8: Outstanding Balance of Standardized Margin Transactions
Outstanding Balance of Standardized Margin Transactions (TSE+JDQ) Feb-06 \ tri \ 5.0 \ 5,352bn 20,000 Standardized Margin Buying Transactions (left) 4.5 18,000 Standardized Margin Selling Transactions (left) 4.0 Nikkei225(right) 16,000 3.5 14,000 3.0 12,000 2.5 10,000 2.0 8,000 1.5 6,000 1.0 4,000 0
Slide 9: Financial Results of Group Companies
Financial Results of Group Companies \ mil FY2009, 1Q Results Shareholding Ratio Operating Recurring Net Revenues* Income Income Consolidated 8,296 1,809 1,032 JSF - 6,437 1,713 1,229 JSF Trust Bank 100% 1,626 205 205 Nihon Building 100% 362 181 107 Equity-method - Loss in Equity-Method ▲ 336 * Figu
Slide 10: Financial Results for JSF Trust Bank
Financial Results for JSF Trust Bank ¥mil FY2008 FY2009 change 1Q 1Q Recurring Revenues 2,373 1,626 ▲746 Recurring Income 63 205 +141 Net Income 90 205 +115 Equity Ratio 18.08％ Financial Financial Highlights Highlights for for FY2009, FY2009, 1Q 1Q Though Recurring Revenues decreased due to the de
Slide 11: Main Assets of JSF Trust Bank
Main Assets of JSF Trust Bank ● Securities Holdings ● Ratio of Securities(as of Jun-09) \mil 2% JGB less than 1Y Sep-08 Mar-09 Jun-09 Notes JGB 448,517 877,724 654,971 22% less than 1Y 408,746 837,866 513,995 JGB over 1Y over 1Y 39,771 39,858 140,975 Short-term Bond 0 0 0 Municipal Bond 0 50,259 70,
Slide 12: CDOs of JSF Trust Bank
CDOs of JSF Trust Bank Synthetic Portfolio Note is expected to be redeemed before maturity and in progress ●CDOs \mil Original Mar-08 Sep-08 Dec-08 Mar-09 Ratings Jun-09 Issue Maturity Principal Balance Balance Balance Balance original change Balance Self Managed CDO 4,000 2,111 1,047 561 232 AAA
Slide 13: Estimated Figures for FY2009
Estimated Figures for FY2009 ¥mil Parent Consolidated FY2009 FY2009 FY2009 FY2009 FY2009 FY2009 1Q Results 1Q-2Q 1Q-4Q 1Q Results 1Q-2Q 1Q-4Q Operating 1,428 2,200 3,000 2,020 2,700 3,900 Profit Recurring 1,713 2,500 3,500 1,809 2,700 4,300 Income Net Income 1,229 1,500 2,100 1,032 1,600 2,700 EPS (
Slide 14: Precondition Balance of Margin Loans
Precondition Balance of Margin Loans FY2009,1Q Results FY2009 Precondition Excess of Excess Excess of Excess of Margin Loan of Stock Loan Stock Loan Margin Loan ¥83bn ¥263bn ¥140bn ¥210bn Matching Matching ¥198bn ¥200bn Margin Loan Stock Loan Margin Loan Stock Loan ¥281bn ¥462bn ¥340bn ¥410bn Precon
Slide 15: Consolidated Estimated Figures
Consolidated Estimated Figures \ mil FY2009, 1Q Results FY2009 Estimated Figures Shareholding Ratio Operating Recurring Net Operating Recurring Net Profit Income Income Profit Income Income Consolidated 2,020 1,809 1,032 3,900 4,300 2,700 JSF - 1,428 1,713 1,229 3,000 3,500 2,100 JSF Trust Bank 100%
Slide 16: Change in scope of Equity-method Companies
Change in scope of Equity-method Companies ≪Before≫ Japan JapanSecurities SecuritiesFinance Subsidiary Subsidiary Finance Equity-method Equity-method ( ) Shareholding Ratio （100%） （100%） （32.7%） JSF Nihon JBIS JSF Nihon JBISHoldings Holdings(non-consolidated) (non-consolidated) Trust TrustBank Bank
Slide 17: Appendix
a Appendix
Slide 18: Main Points of 2nd MMP (FY2009-FY2011)
Main Points of 2nd MMP（FY2009～FY2011） ・ Corporate Idea As s special institution of securities finance business, recognizing sincerely its public task, Japan Securities Finance has a mission to contribute for the development of securities market by capturing actively various needs in securities indus
Slide 19: From 1st MMP to 2nd MMP
From 1st MMP to 2nd MMP FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 ～Strategies of 1st MMP～ ～Strategies of 2nd MMP～ Increase the customers for borrowing stock certificates ◆ Strengthen competiveness of Foreign stocks for Loans for ETFs for Loans for Increase Loanable Issues Margin Loan Business Margin
Slide 20: Increase the number of Loanable Issues
Increase the number of Loanable Issues Increase the number of Loanable Issues to improve convenience and to strengthen competiveness of Margin Loan Business ☆ If Increases the number of Loanable Issues, Improve convenience ・・・Issues eligible for short sale increase, then expect increase of margin tr
Slide 21: Securities-related Business by JSF Group Companies
Securities-related Business by JSF Group Companies TSE TSE Securities Finance Business JASDAQ JapanSecurities SecuritiesFinance Finance JASDAQ Japan Loansfor Loans forMargin Margin Transactions Sapporo Transactions Sapporo Designated Fukuoka Loansfor Loans fornegotiable negotiablemargin margin Fukuo
Slide 22: Features of Balance Sheet
Features of Balance Sheet Features of Assets Features of Liabilities (1) Fluctuation of Loan Balance (1) Fluctuation of money funding amount Loan balance moves everyday because margin loan is Need to response flexibly to fluctuating cash demands, over-night loan because of the fluctuation of margin
Slide 23: Maintenance of Cash Funding Sources
Maintenance of Cash Funding Sources Strengthen cash funding ability by maintaining cash funding sources, to supply low rate money stably to securities market and to enhance company’s financial soundness. To fund fluctuating money with low rate, it’s important for the company to maintain solid amou
Slide 24: Business Strategy of JSF Trust Bank
Business Strategy of JSF Trust Bank Basic Strategy Main Business ◆ Contribute for the development of 1.Trust Business securities market as a trust bank of JSF (1) Securities Trust group ・Administration, Custody and Lending business of equities, ・Trust Business : Core Business etc. for financial inst
Slide 25: Dividend Policy
Dividend Policy Dividend Policy Basically, Basically, Dividend Dividend Payout Payout Ratio Ratio of of about about 40% 40% on on Parent Parent Financial Financial Results, Results, and and considering considering Consolidated Consolidated DPR DPR or or Dividend Dividend on on Equity Equity (DOE
Slide 26: Share Buyback Program
Share Buyback Program total shares start end purchased amount cancellation shares issued shs \ mil shs shs FY2008 2008/4/1 2008/4/18 4,312,800 2,999 99,704,000 2008/5/15 2008/6/11 978,900 999 99,704,000 2008/6/27 2008/7/25 1,000,000 881 99,704,000 2008/9/24 6,004,000 93,700,000 6,291,700 4,881 Numbe
Slide 27: Operating Revenues by Each Business
Operating Revenues by Each Business \ mil Mar-05 Mar-06 Mar-07 Mar-08 Jun-08 Mar-09 Jun-09 Margin Loan Business 17,309 22,993 23,186 23,156 4,410 19,638 3,766 (47.9%) (61.8%) (53.3%) (45.8%) (40.2%) (44.3%) (45.4%) Interest on Loans 6,794 10,158 10,954 10,581 1,283 3,899 730 Interest on collateral m
Slide 28: Avg. & Outstanding Loan Balance
Avg. & Outstanding Loan Balance \ mil FY2008 FY2009 FY2005 FY2006 FY2007 FY2008 1Q 1Q avg. 1,637,698 1,444,347 917,219 436,029 336,324 281,977 Margin Loans term-end 2,328,082 1,634,700 508,587 527,439 244,306 418,865 Bond Financing & General avg. 46,436 79,425 76,941 64,869 51,887 48,693 Loans term-
Slide 29: Margin Buying Transactions & JSF Margin Loans
Margin Buying Transactions & JSF Margin Loans (TSE+JDQ) \ tri 10 60% Margin Buying Balance (TSE+JDQ) 9 Margin Loan Balance (JSF) 50% 8 Ratio 7 40% 6 5 30% 4 20% 3 2 10% 1 0 0% 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 Japan Securities Finance Co.,Ltd 29
Slide 30: Margin Selling Transactions & JSF Stock Loans
Margin Selling Transactions & JSF Stock Loans (TSE+JDQ) ￥tri 2.0 100% Margin Selling Balance (TSE+JDQ) 1.8 Stock Loan Balance (JSF) 90% Ratio 1.6 80% 1.4 70% 1.2 60% 1.0 50% 0.8 40% 0.6 30% 0.4 20% 0.2 10% 0.0 0% 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 Japan Securities Fina
Slide 31: Securities Account
Securities Account Jun-09 notes Jun-09 notes Assets Liabilities \mil \mil Collateral Money of Securities Loans 709,845 1,314,991 Lent Margin Loans 418,865 margin loan Margin Loans 386,279 stock loan Bond Financing & General Loans 50,351 Loans for Negotiable Margin 20,470 Transaction Others 14,500 Tr
Slide 32: JGB Balance
JGB Balance \ mil \ bn JSF 2,000 2.0 JSF Sep-08 Mar-09 Jun-09 253 JGB Balance 1,237,755 2,013,849 1,155,122 1,500 1.5 less than 1Y 995,818 1,760,788 887,648 over 1Y 241,936 253,061 267,474 242 267 1,000 1,761 1.0 (15Y floating JGB) 187,212 188,511 191,050 996 Net unrealized gain or loss on securitie
Slide 33: Margin Loan Rates
Margin Loan Rates Margin Loan Stock Loan BOJ Policy Interest Rate Jul 2006 Uncollateralized O/N Call Rate:0.25％ Securities Company Securities Company Feb 2007 Uncollateralized O/N Call Rate:0.50％ JSF Loan Rate Lending Oct 2008 Uncollateralized O/N Call Rate:0.30％（▲0.20%） 0.97% Fee 0.40% Dec
Slide 34: Loan Rate of Loans for Margin Transactions
Loan Rate of Loans for Margin Transactions 10.0% 8.75% Loan Rate 9.0% Interest Rate on Collateral Money for Stock Loan 8.0% Lending Fee 7.0% Profit Margin 6.0% 5.00% 5.0% Sep-93 4.0% 3.75% 3.0% Jan-09 2.0% May-02 1.37% 1.0% 0.0% 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 Japan
Japan Securities Finance — Q1 FY2009 Earnings Presentation on 6ix