Overview 1. Economy and Market Trends 3. 1 Economic Overview 3. 2 Stock Market 6. 3 Bond Market 9. 4 Investment Trusts Derivative Market 13

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2 CONTENTS FACT BOOK 2018 Overview 1 Ⅰ Economy and Market Trends 3 1 Economic Overview 3 2 Stock Market 6 3 Bond Market 9 4 Investment Trusts 11 5 Derivative Market 13 6 Investor Trends 14 7 Household Financial Assets 16 Ⅱ Securities Industry Overview 19 1 Number of Firms and Employed Persons 19 2 Performance Summary 23 Ⅲ International Comparison 26 Statistical Data 30

3 Overview Overview Ⅰ Economy and Market Trends 1 Economic Overview The Japanese economy on the whole maintained a moderate recovery trend from 2017 to the first half of GDP grew in the first quarter of 2017, reaching a positive 0.7% due to factors such as increasing exports and personal consumption. The second quarter, driven by domestic demand, saw a positive 0.5% growth in response to increases in personal consumption and capital investment. The third quarter followed with 0.5% positive growth. Although the fourth quarter saw an increase in exports, a steep increase in imports held down growth. However, strong domestic demand made possible a stillpositive 0.3% growth rate. The first quarter of 2018 saw a number of negative factors, such as increases in the prices of perishable foods and unfavorable weather conditions, which put downward pressure on the economy and led to a negative 0.2% growth rate, the first negative growth in nine quarters (since the fourth quarter of 2015). Corporate earnings (ordinary profits) in FY 2017 remained at high levels throughout the year and reached a record-high 81,389 billion. Ordinary profits to sales also hit a record high at 5.9%. The Consumer Price Index (CPI) in 2017, due to an increase in oil prices, was a positive 0.5% year on year. The Corporate Goods Price Index (CGPI) had an uptick of positive 2.3% year on year, the first time in three years. The unemployment rate fell to 2.8%, a 24-year record low (since 2.5% in 1993). The job offers to applicant ratio reached 1.5 times, a record 44-year high (since 1.76 times back in 1973). 2 Stock Market In 2017, the Nikkei 225 Stock Average started strong at 19,298. However, conditions that include the appreciation of the yen, fears of protectionism by the US administration, and uncertainty over the French presidential elections pulled down the average. Going into March, rising US interest rates and geopolitical risk from North Korea resulted in a further downturn. After that, stock prices turned to a rising trend in May following lower risk-averse sentiment after the French presidential election, recovering to the 20,000 level in late June in light of good corporate earnings. From July until early September, downward pressure continued due to developments such as the decline in the approval rating for the current (Abe) administration as well as appreciation of the yen. However, due to the dissolution of the House of Representatives and the announcement of a general election for the middle of September, stock prices went up, and by October, the Nikkei rose to 22,000, the highest level since 1996, or about 21 years. Furthermore, stock prices continued to rise from October 2 to October 24, for 16 consecutive days, the longest continuous increase in history. Additionally, as a result of the elections for the House of Representatives, the rise in stock prices gained momentum, and by November, the Nikkei rose again to a level exceeding the highest record set in June 1996 after the collapse of the bubble, reaching the highest level since January After that, the adjustment continued, conscious of the ceiling of 23,000, and by the end of 2017, trades closed at 22,764, a 3,650 increase from the end of In 2018, the Nikkei 225 Stock Index began at 23,073, and remained steady in January. However, in February, stock prices plummeted due to a downturn in US stock markets and the appreciation of the yen. Later, stock prices fluctuated in the 21,000 and 22,000 ranges. Equity financing (paid-in capital increases) by publicly listed companies totaled 1,368.4 billion, a billion increase year on year. The number of initial public offerings (IPOs) increased to 103 companies, up by seven companies from the previous year. However, these IPOs totaled 90.4 billion, down by 100 billion compared with the previous year. 3 Bond Market In 2017, the long-term interest rate (simple interest yield on newly issued 10-year JGBs) started at 0.065% and fluctuated between 0.04% and 0.11%, but due to factors such as geopolitical risks surrounding Syria and North Korea, government bonds, considered to be assets safe from external factors, were widely bought and global interest rates declined, leading to a fall to 0.008% for the long-term interest rate. Later, as a result of the French presidential elections in May, interest rates began to rise, and inklings of monetary tightening led to an increase in the interest rates in Europe and the United States, so that by the first half of July interest rates had recovered temporarily to 0.1%. However, with the implementation of the limit price operation (no bidding) for the long-term zone on July 7, the interest rates again began to decline, and with the rise of geopolitical risk from North Korea, going into September the interest rates dropped to negative levels for the first time since November 2016, hitting % on September 4. While the interest rates recovered to positive levels after that, the increase was limited, with an upper limit of 0.7%, and 2017 trades closed at 0.048%. Going into 2018, long-term interest rates remain low and steady in the 0.03% to 0.1% range due to the BOJ s continuing yield curve control (YCC). Total OTC bond trading volume rose by 3.7% year on year to 01

4 FACT BOOK ,716 trillion (with JGBs accounting for 9,623 trillion). Public and corporate bond issuance was 188 trillion. 4 Investment Trusts Net assets of investment trusts reached a record high of 207,119.9 billion (up 14.9% year on year) at the end of The following are the breakdowns. Publicly offered investment trusts: 111,191.9 billion (up 15.1%) Private placement investment trusts: 85,560.6 billion (up 15.5%) Real estate investment trusts: 10,367.3 billion (up 7.9%) 5 Derivative Market The volume of derivative market transactions in 2017 was million units (down 4.5% from the previous year). Meanwhile, the value of OTC securities derivative transactions in FY 2017 was 357,566.5 billion (up 68.5% from the previous year). 6 Investor Trends The breakdown of stockholdings by investor type as of FY 2017 end indicates that stockholdings by individuals was at a record low of 17.0%, down 0.1 points from the previous fiscal year. However, investment trust holdings increased to 7.2%, up 0.9 points from the previous year, which was a record high in the last 15 years. The percentage held by foreign investors was 30.2%, up 0.1 points from the previous year. 7 Household Financial Assets The composition of household financial assets as of FY 2017 end was as follows. Stocks and other equities: 10.9% (a continued increase) Investment trusts: 4% Cash and deposits: 52.5% Bonds: 1.3% Insurance and pension reserves: 28.5% Other: 2.8% NISA (Nippon Individual Savings Account) that was introduced back in 2014 saw a significant growth from the previous fiscal year with the number of NISA accounts opened as of FY 2017 end at million and amount of annual purchase reaching 13,928.7 billion. Overview Ⅱ Securities Industry Overview 1 Number of Member Firms and others As of FY 2017 end, the number of regular members (securities firms that are members of the Japan Securities Dealers Association (JSDA)) increased by three from the previous year totaling in 264 firms, with seven joining during the said fiscal year and four leaving, etc. The number of special members (banks and other registered financial institutions that are members of the JSDA) was 209 with one less compared to the previous year. The number of employees at FY 2017 end was 90,000, up 1,000 from the previous year, which has been increasing for four consecutive years. The number of domestic offices of regular members at FY 2017 end also grew for the third year in a row to 2,154, up by seven from the previous year. The number of registered sales representatives of member firms at FY 2017 end also increased for four consecutive years to 529,000, up by 3,000 from the previous year. By membership category, the number of sales representatives registered by regular members grew to 76,000 (up 1,000 from the previous year), and the number of sales representatives registered by special members grew to 355,000 (up 2,000 from the previous year), both categories showing growth. On the other hand, the number of sales representatives registered with financial instruments intermediary service providers that are in contract with special members continue to decline. 2 Performance Summary FY 2017 (ending March 2018) total operating revenues for the 257 * securities firms in the securities industry amounted to 4,130.6 billion, a 4% year on year increase. The operating revenues include: Commissions: 2,260.7billion Trading gains: 1,490 billion On the other hand, selling, general and administrative costs increased by 3% year on year to 2,906.4 billion. The SG&A costs include: Transaction expenses: billion Personnel expenses: 1,081.7 billion As a result, the industry posted ordinary profits of billion, a 2% increase from the previous year and a net income of billion, down 12% from the previous year. * Industry figures exclude seven securities firms whose businesses have been discontinued or are not operating from the total of 264 securities firms as of the end of March

5 Ⅰ Economy and Market Trends 1 Economic Overview Economy and Market Trends Nominal and Real GDP For numerical data, please see page 30. Real GDP Growth Rate (quarter-on-quarter) For numerical data, please see page

6 FACT BOOK 2018 Indexes of Business Conditions (Composite Indexes) Economy and Market Trends For numerical data, please see page 31. Corporate Profits (all industries and all scales of business) For numerical data, please see page

7 Economy and Market Trends Consumer Price and Corporate Goods Price Indexes (year-on-year) For numerical data, please see page 31. Employment Conditions For numerical data, please see page

8 FACT BOOK Stock Market Stock Price Indexes Economy and Market Trends For numerical data, please see page 32. Number of TSE Listed Companies and Market Capitalization For numerical data, please see page

9 Economy and Market Trends TSE Trading Value For numerical data, please see page 32. Average PER (Simple Average) of TSE (1st Section) For numerical data, please see page

10 FACT BOOK 2018 Equity Financing (paid-in capital increase) by Corporations Economy and Market Trends For numerical data, please see page 33. Number of Newly Listed Companies and IPO Amounts For numerical data, please see page 33. URL 08

11 3 Bond Market Economy and Market Trends Long-term and Short-term Interest Rates For numerical data, please see page 33. OTC Bond Trading For numerical data, please see page 33. URL 09

12 FACT BOOK 2018 Corporate Bond Financing Economy and Market Trends For numerical data, please see page 34. URL URL Composition of Bond Issuance For numerical data, please see page 34. URL 10

13 4 Investment Trusts Economy and Market Trends Net Assets, etc. Held in Investment Trusts For numerical data, please see page 35. Net Assets, etc. Held in Publicly Offered Contractual-Type Securities Investment Trusts For numerical data, please see page

14 FACT BOOK 2018 Net Assets, etc. Held in Publicly Offered Contractual-Type Stock Investment Trusts Economy and Market Trends For numerical data, please see page 36. Net Assets, etc. Held in Private Placement Contractual-Type Investment Trusts For numerical data, please see page

15 5 Derivative Market Economy and Market Trends Derivative Market Transaction Volume, etc. For numerical data, please see page 37. Value of Securities OTC Derivative Transactions For numerical data, please see page 37. URL 13

16 FACT BOOK Investor Trends Investment by Institutional Investors (Insurance Companies and Pension Funds) Economy and Market Trends For numerical data, please see page 37. Investments by Individual Investors (Household) For numerical data, please see page

17 Economy and Market Trends Stockholdings by Type of Investors For numerical data, please see page 38. Share of Stockholdings by Type of Investors (market value basis) For numerical data, please see page

18 FACT BOOK Household Financial Assets Household Financial Assets Economy and Market Trends For numerical data, please see page 39. Average Financial Assets Held by Age Group 16

19 Economy and Market Trends Nippon (Japan) Individual Savings Account (NISA) For numerical data, please see page 39. Status of DC (Defined Contribution) For numerical data, please see page

20 FACT BOOK 2018 Demographic Pyramid Economy and Market Trends 18

21 Ⅱ Securities Industry Overview 1 Number of Firms, Employees, etc. Securities Industry Overview Regular Members (Securities Firms) For numerical data, please see page 41. URL Special Members (Registered Financial Institutions) For numerical data, please see page 42. URL 19

22 FACT BOOK 2018 Regular Members Employees Securities Industry Overview For numerical data, please see page 42. URL Regular Members Domestic Offices For numerical data, please see page 42. URL 20

23 Securities Industry Overview 21 Regular Members Domestic Offices by Prefecture URL

24 FACT BOOK 2018 Securities Sales Representatives Securities Industry Overview For numerical data, please see page 43. URL Securities Sales Representative Exam Candidates For numerical data, please see page

25 2 Performance Summary Securities Industry Overview Operating Revenues of Regular Members For numerical data, please see page 44. URL Commissions Received by Regular Members For numerical data, please see page 44. URL 23

26 FACT BOOK 2018 Operating Expenses of Regular Members Securities Industry Overview For numerical data, please see page 44. URL Ordinary Profits/Losses and Current Net Profits/Losses of Regular Members For numerical data, please see page 45. URL 24

27 Securities Industry Overview Current Net Profits/Losses by Type of Regular Members For numerical data, please see page 45. ROE by Type of Regular Members For numerical data, please see page

28 Ⅲ International Comparison Real GDP Growth Rate (year-on-year) International Comparison For numerical data, please see page 46. Stock Price For numerical data, please see page

29 International Comparison Market Capitalization Note: Unit: billion USD Source: World Federation of Exchanges (As of the end of 2017) For numerical data, please see page

30 FACT BOOK 2018 Value of Share Trading International Comparison For numerical data, please see page 47. Long-term Interest Rate (10 yr. Government Bond Yield) For numerical data, please see page

31 International Comparison Composition of Household Financial Assets For numerical data, please see page 49. Population Composition For numerical data, please see page

32 Statistical Data Economy and Market Trends 1 Economic Overview Nominal GDP, Real GDP and Real GDP Growth Rate (Billion yen, %) CY, Quarterly Nominal GDP Real GDP Real GDP Growth Rate Private demand Public demand Net exports 1Q 512, , Q 515, , Q 516, , Q 518, , Q 521, , Q 519, , Q 521, , Q 521, , Q 521, , Q 523, , Q 526, , Q 526, , Q 525, , Q 526, , Q 524, , Q 531, , Q 533, , Q 534, , Q 529, , Q 529, , Q 530, , Q 526, , Q 516, , Q 510, , Q 486, , Q 491, , Q 488, , Q 491, , Q 496, , Q 499, , Q 505, , Q 500, , Q 491, , Q 485, , Q 495, , Q 494, , Q 500, , Q 494, , Q 492, , Q 492, , Q 498, , Q 502, , Q 506, , Q 506, , Q 511, , Q 513, , Q 512, , Q 517, , Q 529, , Q 532, , Q 533, , Q 532, , Q 537, , Q 538, , Q 538, , Q 539, , Q 540, , Q 545, , Q 549, , Q 550, , Q 548, , Statistical Data Notes: 1. Data is seasonally adjusted. 2. Real GDP points indicate quarterly comparison figures. Breakdown categories indicate contribution ratios. 3.Data published on June 8, Source: Japanese Cabinet Office 30

33 Statistical Data Indexes of Business Conditions (Composite Indexes) End of CY Leading Index Coincident Index Lagging Index Notes: average = Data published on June 25, Source: Japanese Cabinet Office Corporate Profits (all industries and all scales of business) FY Ordinary profits (Trillion yen) Ratio of ordinary profits to sales (%) Return on equity (%) Notes: 1. FY 2017 ordinary profits and the ratio of ordinary profits to sales are on a preliminary report basis. 2. FY 2017 return on equity is not yet published. 3. Ordinary profits, the ratio of ordinary profits to sales, and return on equity exclude performances of the banking and insurance industries. Source: Ministry of Finance Consumer Price and Corporate Goods Price Indexes (year-on-year) (%) CY Consumer Price Index (excluding fresh food) Corporate Goods Price Index Note: Annual average (year-on-year). Source: Ministry of Internal Affairs and Communications, Bank of Japan Employment Conditions CY Unemployment Rate (%) Job-offers to Seekers Ratio (excluding new school graduates but including part-time workers) (Times) Note: Annual average (seasonally adjusted). Source: Ministry of Internal Affairs and Communications, Ministry of Health, Labour and Welfare 31

34 FACT BOOK Stock Market Stock Price Indexes (Yen/Points) End of CY Nikkei 225 Stock Average 10, , , , , , , , , , , , , , , TOPIX 1, , , , , , , , , , Statistical Data JPX-Nikkei , , , , , Notes: 1. Stock price indexes show closing prices. 2. Base Date for JPX-Nikkei 400 calculation is August 30, (Base value: 10,000 points). Source: Bloomeberg Number of TSE Listed Companies, Market Capitalization, Trading Volume, and Trading Value CY Number of TSE Listed Companies Market Capitalization Trading volume (companies, billion yen, million stocks) Trading value Total Daily average Total Daily average , , ,124 1, , , , ,755 1, ,121 1, , , ,901 2, ,772 2, , , ,463 2, ,762 2, , , ,118 2, ,227 3, , , ,106 2, ,319 2, , , ,576 2, ,766 1, , , ,052 2, ,170 1, , , ,774 2, ,112 1, , , ,928 2, ,886 1, , , ,952 3, ,702 2, , , ,104 2, ,105 2, , , ,718 2, ,955 3, , , ,769 2, ,102 2, , , ,729 2, ,315 3,001 Notes: 1. Total of domestic stocks. 2. Number of listed companies and market capitalization were those at the end of the year. 3. The spot market of former Osaka Securities Exchange was merged with Tokyo Stock Exchange in July Source: Japan Exchange Group Average PER (Simple Average) of TSE (1st Section) (Times) End of CY PER Note: - for the end of 2009 indicates that the total net profit per share was negative. Source: Japan Exchange Group 32

35 Statistical Data Equity Financing (paid-in capital increase) by Corporations (Billion yen) CY Public offerings , ,968 3,320 1, ,134 1, Offering to Shareholders Third-party allotments and others ,808 2,150 2,509 1,220 1,626 1,116 1, , Total 3,464 3,156 3,397 2,883 2,147 1,479 6,334 3,977 1,524 1,918 1,655 2,002 1,879 1,029 1,368 Notes: 1. Third-party allotments include private placements. 2. Initial public offerings made in conjunction with the listing of shares on exchanges before 2007 are not included in the calculations indicates nil. 0 indicates an amount less than 1 unit amount. Source: Japan Exchange Group Number of Newly Listed Companies and IPO Amounts CY Number of newly listed companies IPO amounts (Billion yen) Notes: 1. IPOs include public offerings made when foreign companies list on a Japanese exchange. 2.The figures for the number of new listed companies are for the First and Second Sections, the Mothers and JSADAQ markets of the TSE. Figures for other domestic exchanges are not included. Source: Japan Exchange Group, Japan Securities Dealers Association 3 Bond Market Long-term and Short-term Interest Rates (%) End of CY Simple yield of newly issued 10-year JGBs Uncollateralized overnight call rate Source: Bank of Japan, Japan Bond Trading Co., Ltd. OTC Bond Trading (Trillion yen) CY JGBs 4, , , , , , , , , , , , , , ,623.9 Short-term JGBs, etc. 1, , , , , , , , , , , , , , ,530.8 Medium-term, long-term, Super-long-term, JGBs 2, , , , , , , , , , , , , , ,093.1 Others Total 5, , , , , , , , , , , , , , ,716.7 Note: Short-term JGBs, etc. are the total of financial bills, treasury bills and Treasury Discount Bills (since 2009). Source: Japan Securities Dealers Association 33

36 FACT BOOK 2018 Corporate Bond Financing (Billion yen) CY Straight corporate bonds 7,728 5,879 7,088 6,858 9,258 9,125 11,493 9,678 8,483 8,409 8,708 8,456 6,898 10,715 11,373 Convertible-type bonds with subscription rights , Statistical Data Total 7,800 6,440 7,977 8,281 9,385 9,778 11,780 9,849 8,522 8,445 8,805 8,560 7,135 10,802 11,464 Notes: 1. Straight corporate bonds include asset backed corporate bonds. 2. Financing by corporate bonds with share options was zero. Source: Japan Securities Dealers Association Bond Issuance (Billion yen) CY JGBs 154, , , , , , , , , , , , , , ,168 Municipal bonds 4,264 5,251 6,152 6,031 5,703 5,873 7,439 7,608 6,654 6,771 7,079 6,880 6,849 6,346 6,297 Gov-guaranteed bonds 6,476 8,243 7,821 4,434 4,461 4,494 4,925 4,540 3,153 4,699 4,873 4,600 3,134 3,335 3,643 FILP agency bonds 2,457 3,188 4,187 4,493 4,556 4,472 4,599 4,998 5,647 5,439 4,811 4,134 4,298 4,860 4,814 Straight corporate bonds 7,728 5,879 7,088 6,858 9,258 9,125 11,493 9,678 8,483 8,409 8,708 8,456 6,898 10,715 11,373 Others 15,757 15,812 16,684 13,561 12,150 8,822 5,995 5,838 5,395 4,944 4,368 5,097 4,607 3,120 2,936 Total 191, , , , , , , , , , , , , , ,235 Notes: 1.Excluding private placement municipal bonds. In addition, for 2008 and later, excluding private placement special bonds and private placement corporate bonds. 2. Straight corporate bonds include asset backed corporate bonds. Source: Japan Securities Dealers Association Composition of Bond Issuance (%) CY JGBs Municipal bonds Gov-guaranteed bonds FILP agency bonds Straight corporate bonds Others Total Notes: 1.Excluding private placement municipal bonds. In addition, for 2008 and later, excluding private placement special bonds and private placement corporate bonds. 2. Straight corporate bonds include asset backed corporate bonds. Source: Japan Securities Dealers Association 34

37 Statistical Data 4 Investment Trusts Net Assets, etc. Held in Investment Trusts (Billion yen) End of CY Publicly offered investment trusts Real-estate investment trusts Private placement investment trusts Number of funds Net assets Number of funds Net assets Number of funds Net assets Number of funds Total Net assets Changes in net assets 2,617 2,552 2,640 2,753 2,997 3,333 3,656 3,905 4,196 4,384 4,922 5,404 5,843 6,060 6,152 37,435 40,996 55,347 68,927 79,760 52,146 61,455 63,720 57,327 64,063 81,523 93,504 97,756 96, , ,246 2,050 3,153 3,687 3,968 4,020 3,908 4,109 4,578 6,078 7,137 8,224 9,605 10,367 1,306 1,588 1,881 2,192 2,477 2,603 2,639 2,689 2,698 2,753 2,883 3,351 3,961 4,829 5,483 10,384 15,596 25,643 32,987 36,030 25,555 29,667 30,626 28,542 31,818 40,413 46,870 61,973 74,084 85,560 3,933 4,155 4,549 4,985 5,516 5,978 6,337 6,629 6,928 7,174 7,857 8,817 9,872 10,972 11,721 48,586 57,839 83, , ,478 81,670 95,143 98,255 89, , , , , , ,119 4,746 9,253 25,201 22,027 14,410-37,808 13,472 3,112-8,275 10,481 27,553 19,498 20,442 12,377 26,788 Source: The Investment Trusts Association, Japan Net Assets, etc. Held in Publicly Offered Contractual-Type Securities Investment Trusts (Billion yen) End of CY Stock investment trusts Bond investment trusts Money management funds Total Number of funds Net assets Number of funds Net assets Number of funds Net assets Number of funds Net assets 2,339 2,308 2,408 2,533 2,789 3,135 3,468 3,724 4,017 4,209 4,756 5,242 5,684 5,939 6,032 21,339 27,435 40,828 55,657 66,784 40,842 50,243 52,464 46,761 52,913 65,027 77,095 81,738 83,022 97, ,746 9,955 11,498 10,576 10,059 8,691 8,755 9,026 8,536 9,302 14,569 14,433 14,375 13,553 13, ,350 3,606 3,020 2,693 2,917 2,612 2,456 2,229 2,028 1,847 1,925 1,975 1, ,617 2,552 2,640 2,753 2,997 3,333 3,656 3,905 4,196 4,384 4,922 5,404 5,843 6,060 6,152 37,435 40,996 55,347 68,927 79,760 52,146 61,455 63,720 57,327 64,063 81,523 93,504 97,756 96, ,191 Changes in net assets 1,419 3,561 14,350 13,579 10,832-27,614 9,308 2,264-6,392 6,736 17,459 11,981 4,251-1,114 14,550 Source: The Investment Trusts Association, Japan 35

38 FACT BOOK 2018 Net Assets, etc. Held in Publicly Offered Contractual-Type Stock Investment Trusts (Billion yen) End of CY Unit type Open type (excluding ETFs) ETFs Total Number of funds Net assets Number of funds Net assets Number of funds Net assets Number of funds Net assets ,161 1,799 1,945 1,875 1,876 1,287 1,522 1, ,275 1,479 1,791 1,734 1, ,100 2,038 2,106 2,271 2,527 2,706 3,003 3,289 3,629 3,866 4,440 4,824 5,180 5,400 5,539 17,216 22,522 35,180 49,665 61,029 37,029 46,430 48,588 43,152 47,423 55,456 64,688 63,838 61,292 65, ,962 3,113 3,703 4,116 3,878 2,524 2,290 2,610 2,728 4,214 8,090 10,616 16,165 20,347 30,794 2,339 2,308 2,408 2,533 2,789 3,135 3,468 3,724 4,017 4,209 4,756 5,242 5,684 5,939 6,032 21,339 27,435 40,828 55,657 66,784 40,842 50,243 52,464 46,761 52,913 65,027 77,095 81,738 83,022 97,432 Statistical Data Changes in net assets 4,966 6,095 13,393 14,828 11,126-25,942 9,401 2,220-5,702 6,152 12,113 12,067 4,642 1,284 14,409 Source: The Investment Trusts Association, Japan Net Assets, etc. Held in Private Placement Contractual-Type Investment Trusts (Billion yen) End of CY Stock investment trusts Bond investment trusts Total Number of funds Net assets Number of funds Net assets Number of funds Net assets 1,124 1,410 1,718 2,060 2,363 2,475 2,512 2,568 2,597 2,667 2,789 3,135 3,580 4,150 4,657 9,388 14,646 24,723 32,186 35,406 24,967 28,976 29,912 27,938 31,297 39,618 45,155 59,370 69,951 81, ,715 2,603 4,132 4,255 1,306 1,588 1,881 2,192 2,477 2,603 2,639 2,689 2,698 2,753 2,883 3,351 3,961 4,829 5,483 10,384 15,596 25,643 32,987 36,030 25,555 29,667 30,626 28,542 31,818 40,413 46,870 61,973 74,084 85,560 Changes in net assets 3,003 5,211 10,046 7,344 3,043-10,474 4, ,083 3,275 8,594 6,457 15,103 12,110 11,476 Source: The Investment Trusts Association, Japan 36

39 5 Derivative Market Derivative Market Transaction Volume, etc. Statistical Data (Thousand contracts) CY Transaction volume Current outstanding open contracts 142, , , , , , , , , , ,408 1,700 1,888 2,805 3,462 3,361 5,012 5,346 4,773 3,787 3,928 4,354 Notes: 1. The derivative market of Tokyo Stock Exchange was merged with that of Osaka Securities Exchange in March The figures above show the total volume of the derivative markets of Tokyo Stock Exchange before the merger and Osaka Securities Exchange. 3. Current outstanding open contracts are as of year-end. Source: Japan Exchange Group Value of Securities OTC Derivative Transactions (Billion yen) FY Transaction value End-of-term balance 88,456 97, ,591 88,021 98,697 79,420 69,467 44, , , , , ,566 19,862 21,726 44,211 20,277 15,676 17,580 17,657 12,645 13,567 38,698 45,066 52,523 55,187 Notes: 1. On a notional value basis. 2. End of term balance is as of fiscal year-end. Source: Japan Securities Dealers Association 6 Investor Trends Investment by Institutional Investors (Insurance Companies and Pension Funds) (Billion yen) FY Bonds -1,649 8,658 4,549 11,253 11,581 5,049-2,040-2, ,211 Stocks ,306-1,920-1,924-1, Investment trusts 2,390 1, ,429-1, ,771 1,419 Foreign securities 1,521-1,005 4,915-1, ,835 3,483 8,996 8,914 3,287 Notes: 1. Changes during the fiscal year. 2. Stocks include other equities. 3. Data published on June 27, Source: Bank of Japan Investments by Individual Investors (Household) (Billion yen) FY Bonds -1,352-1,214-3,627-3,525-3,285-2,420-2,250-1, ,254 Stocks 3,075-1,669 1, ,822-6,676-6,803-2,143-3,279-3,653 Investment trusts -2,266 2,166 2,450-2,821 1,361 3,658 5,705 1,043-2, Foreign securities , ,641-1,099 1,339 Notes: 1. Changes during the fiscal year. 2. Stocks include other equities. 3. Data published on June 27, Source: Bank of Japan 37

40 FACT BOOK 2018 Stockholdings by Type of Investors (Billion yen) End of FY Individuals 75,599 84, , ,419 76,653 54,345 68,469 63,040 62,838 76,447 83,429 99,790 90,770 99, ,259 Governments ,866 1,567 1,137 1, ,350 Financial institutions 67,554 67,402 94,097 87,678 59,843 42,541 52,628 48,575 49,007 57,843 65,309 90,484 83,587 94, ,384 Pension trusts 16,581 15,430 20,927 20,185 14,149 9,364 11,697 9,963 9,169 9,580 9,236 10,635 7,693 7,461 7,688 Investment trusts 13,602 15,219 25,537 26,865 19,739 13,378 15,956 13,606 13,881 17,034 21,292 27,530 28,882 36,631 47,901 Insurance companies 29,566 29,441 42,688 43,452 30,875 19,652 23,728 20,017 18,707 21,468 23,042 29,010 24,345 26,654 28,921 Business corporations 80,489 88, , ,043 87,649 60,030 72,542 66,031 66,641 81,938 94, , , , ,541 Foreigners 80,604 92, , , ,222 62,373 88,295 83,037 81, , , , , , ,383 Securities firms 4,494 4,596 8,198 10,385 6,293 2,711 5,341 5,569 6,240 7,463 10,149 12,707 10,703 12,717 13,128 Total 369, , , , , , , , , , , , , , ,559 Statistical Data Notes: 1. Governments include central and regional governments. 2. Financial Institutions do not include pension trusts, investment trusts and insurance companies. 3. Figures cover all exchange-listed stocks excluding foreign stocks. 4.Pension trusts include investment assets of pension related funds of welfare pension funds, etc. for which banks operating trust business are appointed as trustee, but do not include those of public pension funds. 5. Treasury shares owned by each listed company are included under the investor type in which the companies are categorized. Source: Tokyo Stock Exchange Share of Stockholdings by Type of Investors (market value basis) (%) End of FY Individuals Governments Financial institutions Pension trusts Investment trusts Insurance companies Business corporations Foreigners Securities firms Total Notes: 1. Governments include central and regional governments. 2. Financial Institutions do not include pension trusts, investment trusts and insurance companies. 3. Figures cover all exchange-listed stocks excluding foreign stocks. 4.Pension trusts include investment assets of pension related funds of welfare pension funds, etc. for which banks operating trust business are appointed as trustee, but do not include those of public pension funds. 5. Treasury shares owned by each listed company are included under the investor type in which the companies are categorized. Source: Tokyo Stock Exchange 38

41 7 Household Financial Assets Statistical Data Household Financial Assets (Billion yen) End of FY Cash and deposits 805, , , , , , , , , ,547 Bonds 42,270 41,082 37,386 33,931 30,785 28,285 26,156 24,658 24,631 23,268 Stocks and other equities 89, , , , , , , , , ,739 Investment trusts 48,310 59,816 61,316 57,014 65,306 69,531 81,078 73,615 72,200 73,207 Insurance and pension reserves 466, , , , , , , , , ,056 Others 44,130 46,594 44,821 45,431 48,118 47,092 51,626 49,552 51,648 51,201 Total 1,495,698 1,542,537 1,554,625 1,573,597 1,637,212 1,674,218 1,747,973 1,751,898 1,784,524 1,829,020 Notes: 1. Bonds include trust beneficiary rights. 2. Data published on June 27, Source: Bank of Japan Composition of Household Financial Assets (%) End of FY Cash and deposits Bonds Stocks and other equities Investment trusts Insurance and pension reserves Others Total Notes: 1. Bonds include trust beneficiary rights. 2. Data published on June 27, Source: Bank of Japan Nippon (Japan) Individual Savings Account (NISA) Year/Month Number of accounts (Unit: Ten thousand accounts) Purchase amount (Billion yen) ,012 1,029 1,049 1,061 1,077 1,090 1,101 1,099-10,034 15,631 29,769 44,109 51,884 58,597 64,444 77,513 83,761 88,591 94, , , , , ,287 Listed stocks - 3,645 4,949 9,705 13,983 16,282 18,867 21,654 27,464 29,921 31,698 34,018 38,854 41,483 44,436 47,237 54,057 Investment trusts - 6,212 10,395 19,439 29,154 34,477 38,381 41,297 48,126 51,700 54,620 57,636 63,900 67,595 71,370 74,899 81,642 ETF ,314 1,413 1,473 1,572 1,704 1,799 1,875 1,991 2,236 REIT ,010 1,067 1,128 1,197 1,352 Notes: 1. At the time of introduction for January 2014; end of month for others. 2.Figures for September 2014 have not been disclosed. 3. The number of Dollar-Cost Averaging NISA is in parentheses. 4. The amount of purchase represents the accumulated total since the start of the program. Source: Financial Services Agency 1,167 (50) 39

42 FACT BOOK 2018 Status of DC (Defined Contribution) (Billion yen) FY end Corporate type 540 1,172 2,207 2,962 3,434 3,696 4,497 5,014 6,000 6,796 7,720 9,074 9,566 10,525 Individual type ,102 1,215 1,381 Statistical Data Notes: 1.Numbers aggregated based on data managed by record keeping companies. (SBI Benefit Systems Co.,Ltd., Sompo Japan Nipponkoa DC Securities Inc., Japan Investor Solutions&Technologies Co.,LTD., NIPPON RECORD KEEPING NETWORK Co., Ltd.) 2. Numbers for Corporate type DCs as of FY 2003 end do not include numbers from Sompo Japan Nipponkoa DC Securities. Inc. Source: Liaison Council for Plan Administrators Composition Shift of Assets Managed in DC (Defined Contribution) Plans (Corporate type) (%) FY end Deposits and savings Insurance(life/non-life) Domestic equity fund Domestic fixed income fund Global equity fund Global fixed income fund Balanced type fund Others Total Notes: 1.Numbers aggregated based on data managed by record keeping companies. (SBI Benefit Systems Co.,Ltd., Sompo Japan Nipponkoa DC Securities Inc., Japan Investor Solutions&Technologies Co.,LTD., NIPPON RECORD KEEPING NETWORK Co., Ltd.) 2. Numbers for Corporate type DCs as of FY 2003 end do not include numbers from Sompo Japan Nipponkoa DC Securities. Inc. Source: Liaison Council for Plan Administrators (Individual type) (%) FY end Deposits and savings Insurance(life/non-life) Domestic equity fund Domestic fixed income fund Global equity fund Global fixed income fund Balanced type fund Others Total Note:Numbers aggregated based on data managed by record keeping companies. (SBI Benefit Systems Co.,Ltd., Sompo Japan Nipponkoa DC Securities Inc., Japan Investor Solutions&Technologies Co.,LTD., NIPPON RECORD KEEPING NETWORK Co., Ltd.) Source: Liaison Council for Plan Administrators 40

43 Securities Industry Overview Statistical Data 1 Number of Firms, Employees, etc. Regular Members (Securities Firms) End of FY Regular Members No less than 50 million to less than 200 million No less than 200 million to less than 300 million No less than 300 million to less than 1 billion No less than 1 billion to less than 3 billion No less than 3 billion to less than 5 billion No less than 5 billion to less than 10 billion No less than 10 billion Foreign securities firms Enrollments Withdrawals, etc Changes Notes: 1. The amount in the breakdown for the number of member firms shows the classification of capital for domestic securities firms. 2. In April 2004, the minimum capitalization requirement was lowered from 100 million to 50 million. 3. Withdrawals, etc. includes the decrease in the number of Regular Members due to mergers, etc. 4. The companies that withdrew effective March 31 are included in the withdrawals of the next fiscal year. Source: Japan Securities Dealers Association Specified Business Members End of FY Specified Business Members Notes: 1.Specified Business Members are companies that engage only in business for 1) over-the-counter derivative transactions that are not related to securities and not financial futures, 2) equity-based crowdfunding, or 3) electronic transaction platform for over-the-counter derivative transactions. 2. Established in May Source: Japan Securities Dealers Association 41

44 FACT BOOK 2018 Special Members (Registered Financial Institutions) End of FY City banks Trust banks Government-affiliated financial institutions Regional banks Second-tier regional banks Shinkin banks Life insurance companies Non-life insurance companies Money market brokers Foreign banks Securities finance companies Credit cooperatives Other banks Statistical Data Total Note: Shinkin banks include shinkin banks and Shinkin Central Bank. Source: Japan Securities Dealers Association Employees of Regular Members and Specified Business Members End of CY No. of Regular 85,027 86,406 87,913 92,661 99,139 99,200 93,308 92,056 88,807 83,056 82,976 85,358 88,108 89,942 90,931 Members Employees No. of Specified Business Members Employees Total 85,027 86,406 87,913 92,661 99,139 99,200 93,308 92,056 88,807 83,056 82,976 85,358 88,211 90,015 91,012 Source: Japan Securities Dealers Association Regular Members Domestic Offices End of FY Head office Branches 1,511 1,529 1,514 1,534 1,561 1,575 1,550 1,563 1,544 1,491 1, Business offices ,864 1,889 1,886 1,890 Total 2,040 2,077 2,127 2,214 2,296 2,315 2,242 2,219 2,191 2,139 2,088 2,118 2,145 2,147 2,154 Note: From the end of FY2014, the category of Branches is included in that of Business offices. Source: Japan Securities Dealers Association 42

45 Statistical Data Securities Sales Representatives End of CY Regular Members Special Members Specified Business Members Financial instruments intermediary service providers belonging to Regular Members Financial instruments intermediary service providers belonging to Special Members 67,539 69,298 71,965 76,054 81,260 81,198 77,265 75,913 73,410 69,684 70,720 72,342 74,546 75,390 76, , , , , , , , , , , , , , , , ,144 1,870 2,134 2,056 1,944 2,120 2,422 2,632 2,846 3,012 3,021 3,104 3, ,433 99, ,658 94,024 96,729 97,226 96,249 94,808 93,859 93,617 93,211 Total 430, , , , , , , , , , , , , , ,090 Notes: 1.The JSDA began recording the number of securities sales representatives of Specified Business Members in 2015 and those in financial instruments intermediary service providers in Excluding representatives of financial instruments intermediary service providers that are individuals rather than companies. Source: Japan Securities Dealers Association Securities Sales Representative Exam Candidates CY Class-1 (No. of Examinees) Class-2 (No. of Examinees) Special Members Class-1 (No. of Examinees) Special Members Class-2 (No. of Examinees) 5,544 25,452 91,739 74,148 61,716 60,635 61,108 57,099 53,680 83,918 67,586 59,088 58,379 62,174 62,381 6,060 61, , ,635 85,559 87,647 75,797 60,999 47,644 33,176 27,740 27,312 26,018 25,447 21,683 22,843 11,754 14,266 21,715 15,995 15,233 15,575 13,152 12,636 15,352 12,672 10,128 8,731 9,187 10,540 30,434 23,666 44,090 75,680 70,160 67, ,691 56,103 30,380 20,895 16,737 15,038 16,774 17,461 17,554 Total 64, , , , , , , , , , , , , , ,158 Notes: 1. As of April 2004, employees of Special Members became eligible to take the Class-1 and Class-2 Sales Representative Examinations. 2.As of September 2004, JSDA lifted its restrictions (must be an officer or employee of an association member firm) on eligibility for taking the Class-2 Sales Representative Examination. 3.As of January 2012, JSDA lifted its restrictions (must be an officer or employee of an association member firm, must have qualified as Class-2 Sales Representative) on eligibility for taking the Class-1 Sales Representative Examination. Source: Japan Securities Dealers Association Pass Rate of Securities Sales Representative Examination (%) CY Class Class Special Member s Class Special Member s Class Notes: 1. As of April 2004, employees of Special Members became eligible to take the Class-1 and Class-2 Sales Representative Examinations. 2.As of September 2004, JSDA lifted its restrictions (must be an officer or employee of an association member firm) on eligibility for taking the Class-2 Sales Representative Examination. 3.As of January 2012, JSDA lifted its restrictions (must be an officer or employee of an association member firm, must have qualified as Class-2 Sales Representative) on eligibility for taking the Class-1 Sales Representative Examination. Source: Japan Securities Dealers Association 43