Corporate Profile & Business Strategy

March 2018

Contents

Company Overview

Business Results

New Management Plan “New Age’s Flag Bearer 5”

Supplementary Material

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

1 Company Overview Profile and History

 Corporate Profile Company Name: Tokai Tokyo Financial Holdings, Inc. (TSE, NSE:8616) Representative: Tateaki Ishida, President & CEO Consolidated Net Assets: 172.9 billion yen Client Assets under Custody of Tokai Tokyo Securities: 4,870.3 billion yen (Retail Client Assets: 2,809.1 billion yen) Market Capitalization: 196.7 billion yen Number of Employees: Holding Company 184 Consolidated Basis: 3,427 （As of December 31, 2017）

 Group History Current group configuration was formed in Apr. ‘17 October 2000 through merger between Tokyo Apr. ‘10 Securities and Tokai Maruman Securities Relocated HQ of TTSC Acquired to Nagoya City Apr. ‘09 Takagi Sec. Group company of the Apr. ‘10 Nikko Securities (a) Tokai Tokyo March. ‘17 Sep. ‘17 Financial Holdings TTSC merged with

Tokyo was established Financial Acquired Acquired Securities Services Sec. ETERNAL Pinnacle

Tokai Tokyo Securities

Tokai

Maruman Nov. ‘08 May ‘10 Oct. ‘12 Jan. ‘17 Apr. ‘17 Hamagin Nishi- Senshu Hokuhoku Tochigi Bank Securities Oct. ‘07 Nippon invested in YM TT Ikeda TT TT Group company of the City TT Utsunomiya Tokai Bank(b) Securities

* Currently, (a) SMBC Nikko Securities, (b) Bank of Tokyo-Mitsubishi UFJ

2 Company Overview AUC and Shareholder Information

 Asset Under Custody （Billion Yen）

7,000 6,000 JV Securities Total 5,000 4,000 Takagi Securities 3,000 2,000 Tokai Tokyo Securities 1,000 0 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Sep-17

No. of Ownership  Distribution of Shareholders Major Shareholders shares (K) Ratio (%) Treasury - "Schroders Group"(*) 18,200 7.55 Securities Stock 1 Trustee Services Bank, Ltd. (Trust Account) 12,875 4.58 * The data of the shareholder Houses 6.7% ranking No. 1 through 10 Individuals & 2 The Bank of Tokyo-Mitsubishi UFJ, Ltd. 12,016 4.28 2.6% Others were identical in substance to 20.7% 3 The Master Trust Bank of Japan, Ltd. (Trust Account) 10,379 3.69 what we had publicized for disclosure purpose. However, Foreign 4 Sumitomo Insurance Co., Ltd. 9,033 3.21 the Change Report Pertaining Investors 5 Toyota Financial Services Corporation 8,885 3.16 to the Report of Possession of 21.3% 6 The Bank of , Ltd. 7,014 2.50 Large Volume submitted on November 7, 2017 Schroder 7 Nippon Life Insurance Company 5,611 2.00 group show that their 4 Financial 8 J. P. Morgan Chase Bank 385166 4,840 1.72 companies altogether owned Other Institutions 7.55% of Tokai Tokyo Domestic 38.5% 9 Sumitomo Mitsui Trust Bank, Limited 4,800 1.71 Financial Holdings, Inc. as of Institutions 10 Meiji Yasuda Life Insurance Company 4,406 1.57 October 31, 2017 10.2% (As of September 30, 2017)

3 Company Overview Group Structure

Group Structure

Tokai Tokyo Financial Holdings, Inc. a holding company listed on TSE and NSE

Overseas Business Alliance

Bao Kenanga Investment Bank

First First BualuangSecurities (Thailand) Stifel(USA) Financial Corp. The Bank of East Phillip Mirae GuotaiJunan Securities(China)

Pinnacle

Tokai Tokai Tokyo Tokai PhilipTokai Tokyo Investment Tokai Tokai Securities* Tokyo Takagi Tokai Investment Tokyo Tokai Tokai Research Tokyo Tokai Academy Tokyo Tokai Service Tokyo Tokai Business Tokyo Service Eternal Tokai Securities Tokyo (Asia) Tokai Securities Tokyo Europe Tokai Securities Tokyo (USA) Tokai Investment Tokyo SecuritiesYM Hamagin Nishi Senshu Ikeda Hokuhoku Tokai Securities Tokyo UtsunomiyaSecurities Securities Ace Nippon AllAsset Management

Viet(Vietnam) Securities

Metro Investment Investment Metro Corporation

-

Nippon City Tokai Tokai Tokyo CityNippon

TokyoGlobal Investments Tokyo Wealth Wealth Tokyo

Asset Asset

Securities(Singapore)

Securities

Tokai Tokai

Daewoo

Asset

Tokai Tokai Tokyo

Tokyo Securities Tokyo

Asia

Management

Consulting

Securities(Korea

(Hong

Institute

Management Management

(Malaysia

Securities

Kong)

Management

Securities

(

Philippines

)

Singapore

)

)

Consolidated Subsidiaries Equity Method Affiliates

* In April 2010, Tokai Tokyo Securities Co., Ltd. and Toyota Financial Services Securities Co., Ltd. merged. as of December 31, 2017

4 Company Overview Characteristics

Chubu Area - No.1 in Value of Shipment of Manufactured Goods Solid Business - Linear Bullet Train Base in - Hydrogen Fuel Cell Vehicle - Mitsubishi Regional Jet (MRJ) Chubu Area

Alliance Advanced & Platform Business Model

- 6 Joint Ventures with Regional - Wealth Management (Orque d’or) Banks Sound - Retail (MONEQUE) - Brokers’ Broker Business Management - Market (Foreign Stocks, Structured Notes) - Outside Directors - Investment Banking (Debt, IPOs) - Company with an Audit & Supervisory Committee - 3 Defense Lines

5 Company Overview Financial Summary

Nikkei 225 (Yen)  Financial Results [Quarterly] and 24,000

20,000

16,000

¥11.16 billion gain of 12,000 negative goodwill by acquiring Takagi Securities Operating revenue, 8,000 Ordinary income （ Net income (Million Yen) (Million Yen) 35,000 17,500 Operating Revenue(LHS) 30,000 Ordinary Income(LHS) 15,000 25,000 Net Income(RHS) 12,500

20,000 10,000

15,000 7,500

10,000 5,000

5,000 2,500

0 0 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

Recorded positive ordinary income non stop for 29 consecutive quarters

6 Business Results Major Initiatives and Project Progress Wealth Management FYE March 2016 Asset Management Brokerage FYE March 2017

Brokerage

Brokerage Ace Sec

Hokuhoku TT Sec Utsunomiya Sec Insurance One Stop Channel

Brokerage M&A Advisory FYE March 2018

Takagi Sec

7 Business Results Comparison Study

 Market Cap Trend in comparison with Nomura and Daiwa

(Million Yen) Market Cap Multiple

5,350,000 1.0

4,350,000 6.0 3,350,000 野村Nomura 大和Daiwa 2,350,000 11.0

1,350,000

350,000 16.0

350,000 TokaiTokai Tokyo Tokyo 21.0 300,000 対大和倍率Daiwa/Tokai Tokyo

250,000 対野村倍率Nomura/Tokai Tokyo 26.0 200,000

150,000 31.0

100,000

50,000

2007/4 2008/4 2009/4 2011/4 2012/4 2013/4 2014/4 2015/4 2016/4 2017/4 2010/4

0 2017/10

2007/4 2009/4 2010/4 2011/4 2012/4 2013/4 2014/4 2015/4 2016/4 2017/4 2008/4

8 Business Results Financial Summary and Performance in Comparison with Peers

【FY2017 9 months Operating revenue】 Amounts Tokai Tokyo Nomura Daiwa Company (million yen) Y on Y 1 Nomura *1 1,460,944 13.4% EPS 2 Daiwa 527,140 17.1% (Yen) 150 130.4 3 ◎ SMBC Nikko 292,800 16.9% 99.6 4 ◎ Mitsubishi UFJ 282,080 (1.9%) 100 87.7 87.1 69.5 61.7 67.361.6 68.3 61.5 5 ◎ Mizuho 279,213 (14.4%) 46.9 61.5 42.7 57.6 43.0 50 45.7 6 Tokai Tokyo 63,639 37.3% 29.0 36.5 7 Okasan 61,786 2.5% 0 8 ◎ SMBC Friend 23,599 (24.4%) ROE 9 Ichiyoshi 19,750 30.8% (%) 10 IwaiCosmo 15,398 31.8% 30 21.0 【FY2017 9 months Net Income】 20 17.7 17.0 Amounts 12.6 Company Y on Y 9.7 12.8 (million yen) 8.1 8.9 8.7 7.7 8.6 9.5 8.4 8.1 10 7.8 4.9 8.6 1 Nomura *1 196,668 10.3% 4.9 2 Daiwa 73,998 (9.4%) 0 3 ◎ SMBC Nikko 49,534 88.3% 4 ◎ Mitsubishi UFJ 31,184 (13.7%) Dividend Yield 5 ◎ Mizuho 24,059 (86.4%) (%) 5 4.5 4.5 4.2 6 Tokai Tokyo 21,904 184.8% 4.2 4.1 4 3.7 3.7 3.8 3.8 7 Okasan 4,266 (46.6%) 2.9 2.9 3.2 3 2.3 2.6 2.7 2.6 2.3 8 Ichiyoshi 3,618 149.3% 2 1.4 9 IwaiCosmo 3,478 146.7% 1 10 Kyokuto 2,334 ▲40.3% 0 ◎: Bank-affiliated companies *1 US GAAP based FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 2Q Note: Excluding online brokers Tokai Tokyo Financial Holdings prepared the table *EPS and ROE is annualized by multiplying 2 to actual semi-annual figures. compiling from publicly disclosed data

9 New Management Plan “New Age’s Flag Bearer 5” Overall Picture

“New Age’s Flag Bearer 5”

Further Strengthen Operating Base and Achieve Growth Pursuit Strategic Themes

Orque Humanity d’or Organization Growth by M&A Matured MONEQUE Asset management Unique Pension and insurance development of service Defense Professionality retail strategy Mechanism Banking service

Market & Overseas market Investment Great Platform expansion Bank Expansion to Metropolis

Productivity Revolution

10 New Management Plan “New Age’s Flag Bearer 5” 5 Giants

SMBC Nikko Nomura Mitsubishi UFJ Morgan Daiwa Mizuho

Tokai Tokyo Financial Group “New Age’s Flag Bearer 5”

11 Supplementary Material Solid Business Base in Chubu Area

“Chubu Area” consists of four prefectures, Aichi, Mie, Gifu and Shizuoka. Value of Shipments of Chubu Manufactured Goods Area Aichi 25% 14% Tokyo Area Gifu 17% 2% Mie 4% 2014 Shizuoka 5% Osaka Area 12% Others 46%

“Tokyo Area” consists of Tokyo, Kanagawa, Saitama and Chiba. “Osaka Area” consists of Osaka, Kyoto, Hyogo and Nara. Ongoing 3 Big Projects in Chubu Area Aichi has been No.1 Since 1977

Aichi has No.1 share in the 10

(out of 24) industries ・Transportation Equipment

MRJ (39%－Toyota, , Yamaha Motor, , Aishin, Mitsubishi Heavy

Industry)

Chuo ・Production Machinery Hydrogen Shinkansen (※) fuel cell vehicle (11%－YAMAZAKI MAZAK, Okuma) ・Business oriented Machinery （※）operated by Superconducting Maglev System (16%－Brother Industries)

12 Supplementary Material Pursue Unique Segment-Specific Strategy in Retail Operation

“Orque d’or”

Nagoya Tokyo Kansai After-death Sales activities care service at affiliates Matured Asset IFA analysis Segment

Integrated sales activity for Restructuring corporate and retail outlets

FinTech “MONEQUE” - MoneyForward - KALAIS - Life Plan Simulation “Insurance Terrace” “Mutual Fund Counter” Bank Online brokers (by ETERNAL) (by Takagi Sec.)

13 Supplementary Material Alliance with Regional Banks

Top 20 Regional Banks (total deposits) （As of September 30, 2017) Bank Date of Bank Name Deposits JV Name Commencing (Trillion Yen) Operation 1 Concordia Financial Group 14.8 Hamagin Tokai Tokyo Sec Nov-2008 2 ★ Mebuki Financial Group 13.5 3 ★ 13.2 4 ★ 11.5 5 Hokuhoku Financial Group 10.7 Hokuhoku Tokai Tokyo Sec Jan-2017 6 ★ 9.4 7 Yamaguchi Financial Group 8.6 YM Securities Sec Oct-2007 8 ★ Kyushu Financial Group 7.9 9 Nishi-Nippon Financial Holdings 7.7 Nishi-Nippon City Tokai Tokyo Sec May-2010 10 ★ The 77 Bank 7.2 11 ★ Hiroshima Bank 7.0 12 ★ Kyoto Bank 6.7 13 ★ Gunma Bank 6.4 14 ★ The Hachijuni Bank 6.4 Total Bank Deposits 15 ★ Chugoku Bank 6.1 49 Trillion Yen 16 The Juroku Bank 5.4 17 ★ The Bank 5.0 18 ★ Iyo Bank 4.9 19 Senshu Ikeda Holdings 4.8 Senshu Ikeda Tokai Tokyo Sec Sep-2013 20 ★ Ogaki Kyoritsu Bank 4.8

- Tochigi Bank 2.6 Utsunomiya Sec Apr-2017 ★ : Banks that have subsidiary securities companies ※ Denotes Tokai Tokyo Financial Holdings’ alliance partners

14 Supplementary Material Alliance with Regional Banks

Assets under Custody - from JVs (6 Entities) Income Contribution from JV Affiliates Income and Other Benefits Realized from Transactions with JVs （Million Yen） (Billion Yen) Gain on Investments in Partnership (%) 7,000 50 1,600 Proportion to Consolidated Ordinary Income 6,000 45 1,444 40 5,000 1,400 35 4,000 30 1,244 3,000 25 1,200 20 1,047 2,000 1,024 15 1,009 1,000 963 998 10 1,000 0 884 5 -1,000 0 841 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 800 780 1H 668 Assets under Custody by Product 642 (Billion Yen) 540 Others 600 538 450 1,400 371 1,200 Investment 400 Trusts 305 1,000 245 Foreign & 800 Structured 200 Bonds 600 Domestic 36 Bonds 5 400 0 Foreign 200 Stocks 0

Domestic

Sep-09 Sep-10 Sep-11 Sep-12 Sep-13 Sep-14 Sep-15 Sep-16 Sep-17

Sep-08 1H 2H 1H 2H 1H 2H 1H

Mar-15 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-16 Mar-17 Mar-08 Stocks FY2014 FY2015 FY2016 FY2017

15 Supplementary Material New Management Plan

Security Information Education Asset brokerage management FinTech （ＩＴ・ＡＩ） MONEQUE

Hamagin TT Sec. Securities Trust Nishi-Nippon YM Sec. companies IFAs Insurance bank City TT Sec. Local banks Platform alliances （53 entities as of Sep. 2017） “Mutual Fund Consulting Ikeda Senshu Hokuhoku Counter” (by TT Sec. TT Sec. Securities Local financial Takagi Sec.) Utsunomiya companies firms Sec. Call center M&A

High-net- Investment Overseas Operation worth Bank

Provided functions Strengthen functions New functions

16 Supplementary Material Area Coverage [Brokerage Business]

 Nationwide network

Tokai Tokyo Securities : 68 operating outlets Takagi Securities : 14 operating outlets

JV Securities : Tohoku 75 operating outlets 1 outlets

Koushin’etsu 2 outlets Senshu Ikeda TT Hokuhoku TT (7 operating outlets) (4 operating outlets) Kinki Chugoku/ 3 outlets Utsunomiya Securities Shikoku 4 outlets (6 operating outlets)

YM Securities Kanto Hamagin TT (22 operating outlets) 13 outlets (17 operating outlets) （8 in Tokyo） Kyushu Tokai 1 outlets 44 outlets （35 in Aichi Pref.） ETERNAL Nishi-Nippon City TT (Insurance Terrace 72 outlets) (19 operating outlets) (As of December 31, 2017)

17 Supplementary Material Overseas Network

Tokai Tokyo Securities Europe

Mirae Asset Daewoo Stifel Financial Corp. Guotai Junan Securities Securities

Tokai Tokyo Financial Holdings

Tokai Tokyo Securities (Asia) Tokai Tokyo Securities (USA) Bualuang Securities Bank of East Asia

Kenanga Investment Bank

Bao Viet Securities Phillip Securities First Metro Investment Corporation Phillip Tokai Tokyo Tokai Tokyo Investment Investment Management Management Singapore

Tokai Tokyo Global Investments

Headquarters Overseas Subsidiary Overseas Affiliate Business Partnership Business Partnership with Capital Injection (As of December 31, 2017)

18 Inquiries to be directed to:

Corporate Communications Department TEL: +81-3-3517-8618 FAX: +81-3-3517-8314 E-mail: [email protected]

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.

 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.

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