Nomura : Presentation at Nomura Investment Forum 2019

Connecting Markets East & West

Presentation at Nomura Investment Forum 2019

Returning to growth

Koji Nagai

Group CEO

Nomura Holdings

December 3, 2019

© Nomura

Agenda

1

2

3

4

Businessrecap

Progress of business platform realignment

Future direction of our business

In closing

1

Business recap

Net income (loss) attributable to Nomura Holdings shareholders per share1

Shares

2.66 billion

3.72 billion

3.82 billion

outstanding

(Mar.09)

(Dec.09)

(Jul.11)

1.97 billion

(yen)

158.8

EPS before 2009

capital raise

92.0

88.8

Upper

61.3

48.8

Lower

21.6

7.9

3.1

-35.6

-366.2

FY02/03

FY03/04

FY04/05

FY05/062

FY06/072

FY07/08

FY08/09

FY09/10

FY10/11

FY11/123

1. Diluted net income (loss) attributable to Nomura Holdings shareholders per share

2

2. Pretax income of Y55.4bn for the fiscal year ended March 2006 and Y52.8bn for the fiscal year ended March 2007 booked by former Merchant Banking business

3. Nomura Real Estate Holdings included as consolidated subsidiary

Business recap

Net income (loss) attributable to Nomura Holdings shareholders per share1

Sep 2012

Aug 2014

(yen)

Announced mid- term management targets (EPS Y50)

55.8

Achieved targets 2 years ahead of schedule

Announced long-term management vision for 2020 (Vision C&C)

• Create organization capable of consistently delivering EPS of Y100
• Establish an operating platform capable of delivering sustainable growth under any environment

60.0	65.7	61.9

35.5

28.4

3.1

		FY11/122	FY12/13	FY13/14	FY14/152	FY15/162	FY16/17	FY17/18
1.	Diluted net income (loss) attributable to Nomura Holdings shareholders per share				3
2.	Nomura Real Estate Holdings included as consolidated subsidiary

Sale of shareholdings and winding up of legacy transactions

Sale of share holdings:

Apr 2017

Jul 2019

Y523bn

Feb- Mar 2016

Sale of Takagi

Partial sale of Nomura

Sale of Chi-X Canada, Chi-X Australia,

Securities shares

Research Institute shares

Chi-X Japan, Chi-X Global Technology

(Y160bn)

Jul 2017

(HK)

Mar 2018

Sale of entire JAFCO

Feb 2014

stake (Y38.7bn)

Sale of stake in Asahi

Nov 2015

Sale of stake in Fortress

Fire and Marine

($363.4mn)

Sale of Mitsui Life

Insurance

Dec 2012

shares

2019

Sale of stake in UK

Mar 2014

Annington

Partial sale of JAFCO

2018

stake (Y10.8bn)

Mar 2013

Mar 2014

2017

Partial offering of

Nomura Real Estate

Partial sale of stake in

Jun 2018

2016

Holdings shares

Daiko Securities (Y1.9bn)

Judgement issued in FHFA litigation

2015

case against US subsidiaries

(Payment of $806mn)

2014

Oct 2018

Settlement with U.S. DoJ over legacy

2013

Sep 2015

transactions (Penalty of $480mn)

2012

Settlement with Banca Monte dei Paschi

Winding up legacy

di Siena SpA (approx. Y34bn)

transactions: Y176bn

4

Proactive approach to shareholder returns

Shareholder		Consolidated dividend payout ratio of						Policy on
	30%									holding and
return policy		Total shareholder return ration incl. share						retiring
				buybacks of at least 50%					treasury stock
							Outstanding shares: 3.82 billion
			(Outstanding shares excl. treasury stock: 3.66 billion (as of end-Mar 2012))
(billions of yen)				Net income (loss) attributable to NHI shareholders				Dividend amount
								152								132
			104		11099			115				108
		103			95				101
			73				72
		55			65	49								62
		30	32	36			61	32
	7	32				16
5		30	33	10	47	36				32	39
22				11
			22

• In principle, retire treasury stock held above 5% of outstanding shares

	3.64 billion	3.49 billion
	(3.23 billion (as of
			end-Sep 2019))
Share buyback amount			194
				140
109	111
78	89			91
47	52
	10	10
31	37	48

-6

Total dividends

Y416.3 billion

Total share buybacks1

Y469.6 billion

Total

Y885.9 billion

-94

FY12/13

FY13/14

FY14/15

FY15/16

FY16/17

FY17/18

FY18/19

FY19/

20

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

1. Including allocations for stock options

5

Robust capital base: Control risk assets while raising capital levels

Tier1 capital

(trillions of yen)		CET1 Capital		2.7		Other Tier1 Capital	2.7
	2.3	2.5	2.6	2.7	2.6
2.1							2.5

Mar-13Mar-14Mar-15Mar-16Mar-17Mar-18Mar-19Sep-19

RWA

(trillions of yen)	18.9
17.5	17.4
16.0	15.1
		14.3	14.6
		14.0

Mar-13Mar-14Mar-15Mar-16Mar-17Mar-18Mar-19Sep-19

Tier1 capital ratio, CET1 capital ratio

CET1 capital ratio	Tier1 capital ratio
20.0%
	19.2%	18.3%	18.4%
	17.6%

	18.2%	17.3%
16.1%	17.1%
16.5%

15.0%	15.4%

13.2% 12.9%

11.9%

10.0%

5.0%

Mar-13Mar-14Mar-15Mar-16Mar-17Mar-18Mar-19Sep-19

6

Large gap between FY19/20 assumptions and actual interest rate levels and fee pool growth rate

Nikkei 225

(yen)

30,000

2020 (assumed):Y25,000

25,000

20,000

15,000

10,000

5,000

Aug-14

Aug-16

Aug-18

Unsecured overnight call rate

(%)

2020 (assumed):1%

1
0.8
0.6
0.4
0.2
0
-0.2
Aug-14	Aug-16	Aug-18

USD/JPY rate

(yen)

130

2020 (assumed):Y115

120

110

100

90

80

Aug-14

Aug-16

Aug-18

Wholesale fee pool growth rate

(billions of dollars)		Wholesale fee pool
	Wholesale fee pool with CAGR of 3%
300		Wholesale fee pool with CAGR of 1%
			2020 (assumed):1% annualized
250
200
150
2014	2015	2016	2017	2018
				7

Megatrends shaping future financial services industry (1)

Prolonged period of super loose monetary policy leading to decline in global liquidity

	Japanese government bonds and US Treasury liquidity
Central bank balance sheets expand	declines2

Indexed, Dec 2010 = 100
500	BoJ			447
400	Fed
ECB
300
			234
200
100				165
0
2010	2012	2014	2016	2018

Dealer inventories decline1

(billions of dollars)

400

300

200

100

0
2010	2012	2014	2016	2018

7.0%
6.0%	JGB Turnover Ratio	UST Turnover Ratio
5.0%
4.0%
3.0%
2.0%
1.0%
0.0%
2010	2012	2014	2016	2018

1.

Source: Federal Reserve Bank, inventories of government bonds, agency bonds, corporate bonds, commercial paper, etc., held by primary dealers

8

2. Source: Nomura, based on US SIFMA and AsianBondsOnline

Megatrends shaping future financial services industry (2)

Advances in digital innovation ~ Increase of electronic trading1

US Equities		Japan Equities	74%
	62%	69%
	60%
48%

40%

2014	2018	2021	2014	2018	2021
		(Expected)			(Expected)

• Impact on financial institutions' business modelsFinancial institutions

Rise of
Fintech	Overhaul of business models

Consumers (clients)

Entrants from other

industriesNewChanging consumer behavior value

Large concentration of personal financial assets expected among those over 75 and in three major metropolitan areas

• Increase in percentage of personal financial assets owned by those over 752

2015		2030 (assumed)
24%		Up to 46%

• Large concentration of personal financial

assets in major metropolitan areas due to aging and inheritance (2016-2030)3

% change in personal financial assets

0% ~ under 10%

-10% ~ 0%

-20% ~ under -10%

1.	Source: Greenwich	9
2.	Source: Nomura Institute of Capital Markets Research estimates, assumes asset transfer through secondary inheritance only
3.	Source: Nomura Institute of Capital Markets Research estimates, calculated based on only financial assets of inheritance assets

Agenda

1

2

3

4

Businessrecap

Progress of business platform realignment

Future direction of our business

In closing

10

Write down outstanding goodwill and start rebuilding business platform

Net income (loss) attributable to Nomura Holdings shareholders per share1
August 2014	April 2019

Announced long-term management vision for 2020 (Vision C&C)

• Create organization capable of consistently delivering EPS of Y1001
• Establish an operating platform capable of delivering sustainable growth under any environment

(yen)						Start rebuilding business platform
			Write down of
		65.65		outstanding
55.81	60.03	61.88	goodwill
			attributable to

	35.52	Wholesale
28.37
3.14

							-29.92
FY11/12	FY12/13	FY13/14	FY14/15	FY15/16	FY16/17	FY17/18	FY18/19
1. Diluted net income (loss) attributable to Nomura Holdings shareholders per share			11

Business platform rebuilding initiatives on track

1. Overhaul matrix management structure
2. Simplification of Corporate Structure
3. Retail

3Wholesale

Main actions

Eliminate the concept of region

Consolidate 10 functions into 5, except Internal Audit

Realign channels

Consolidate branch offices

Provide optimal services in all areas (Pursue added value including improving areas of expertise)

Reduce lower growth, lower profitability businesses

Expand client businesses

Pursue efficiency and growth opportunities by leveraging technology

Progress (as of Nov 2019)

Implemented effective May 1, 2019

Implemented effective May 1, 2019

1.25 million accounts handed over to new sales representatives by end-Aug 2019

25 branches consolidated during Aug-Sep 2019

=> Refer to page 15

Reduction of front office staff completed

=> Refer to page 19

=> Refer to page 20

Reduce cost

(Reduction of approx. Y140 billion by Mar 2022)

• Wholesale ($1bn): Upper 60% achieved
• Retail (10%; approx. Y30bn): approx. 50% achieved
• Plan to reduce Corporate allocation costs by simplifying operating model, etc.

12

1Overhaul matrix management structure

• Overhaul regional management and reduce cost
• Simultaneously simplify operating model to enableglobal-based, flexible allocation and effective use of

resources in line with changes in the environment, while demonstrating regional characteristics

Management structure from May 1, 2019

New Wholesale structure following reorganization1

Old: Region-led management

Manage

EMEA

AEJ

Japan

Americas

Japan

AEJ

EMEA

Americas

objectives

-

Rates

-

FX/EM

-

Rates

-

Rates

Allocate

resources

-

FX/EM

-

Equities

-

FX/EM

-

FX/EM

Retail

Region-led

-

Equities

others

-

Equities

-

Equities

others

others

others

Asset

EMEA MIS

AEJ MIS

Japan MIS

AmericasMIS

Management

Globally consolidateregional products

Wholesale

GM

New: Global-based, seamless portfolio management

IB

Global-based

Rates

Corporate

management of

objectives and

FX/EM

resources

MIS

Strengthen global

Equities

risk management

of diverse asset

Others



Simpler, leaner organizational structure

classes

EMEA

AEJ

Japan

Americas



Agile and efficient decision making



Enable cost reduction across regions

Continue region-led management of daily

operations and client relations

1. MIS: Management Information System used for decision making

13

2Simplification of Corporate structure

• Consolidate Corporate functions (excluding Internal Audit) from 10 to 5, creating simpler organization to avoid duplication and enable speedy decision making

• Maintain independent check function while overhauling operating model

Previous	Current structure and initiatives to date
structure			(From May 2019)
(Until April 2019)
Finance				Consolidate middle office function previously spread
		Chief Financial Officer		across Finance, Operations and Risk Management in
Operations				Global Middle Office (GMO)
				Currently consolidating Japan and some AEJ
Risk Management		Chief Risk Officer
		functions as APAC (Aiming to optimize organizational
				structure and create more efficient business model )
Legal
		Consolidate non-finance risk functions such as Legal,
Compliance		Chief Compliance Officer
		Compliance and Operational Risk in Legal,
			Compliance & Controls
HR
Chief Strategy Officer		Overhaul regional governance framework by
Corporate
Communications				simplifying committee organizations in overseas
				regions
Strategy
	Chief Administrative Officer		Shift to entity-led management structure
Headquarters
			Consolidate Wholesale client-facing functions such
IT				as order execution reporting and account opening in
			Client Service Group
Internal Audit
			Consolidate stocks data management handled by
Internal Audit
			Operations in IT

Examples of future

initiatives

• Restructure GMO operations
• Optimize and organize transaction data for back and front offices
• Conduct P/L and risk verifications and optimize reporting operations
• Consolidate branch back office operations
• Standardize some back office operations handled by domestic branches
• Create shared service model

• Create simpler organization

Aims	Establish globally aligned organization/ operating structure
=> Promote cross-regional growth strategy, and build infrastructure to pursue inorganic growth
	through alliances, etc.

14

3Retail initiatives: Channel realignment

Enhance products and services for each coverage area in line with client types and needs

Channel alignment	# accounts per
sales staff (ave.)
No change	Partner change
Before	After

Examples of major initiatives

UHNWI
+
Corporates		chargeIn
	elderly
	In	retirees
HNWI	charge
	HNWI	of
	of
Mass affluent	300
Mass retail

specified of charge in not Partners clients

2200

corporates Approx.

2500 HNWI

massaffluent Approx.

1900

of charge In of charge In of charge In

Approx. Approx.

300 300

Approx. Approx.

450 280

Approx. Approx.

330 470

• Manage assets for corporates/owners
• In addition to managing assets, establish multiple pillars of revenue: Provide broad range of consulting services including those for corporate clients' main business
• Approach to new clients
• Make proposals that offer high added value for individuals' balance sheet (asset management, loans, tax planning, asset succession for next generation, etc.)
• Increase active clients: Improve client satisfaction through efficient,user-friendly approach
• Balance optimization of operations and services by making use of head office support and tools

15

3Retail initiatives: Branch office strategy

Branch office strategy: Consolidate 47 branches in 7 years

Number of branches by area (March 31, 2012 vs September 30, 2019)

						-47
178				-22
-19	159	159		157	156
			-2	-1	-25	131

Mar 2012

Mar 2014 Mar 2016

Mar 2018

Mar 2019 Sep 2019

• Reviewed branch office structure in line with changes in client behavior from 2012
• Brought people together to better cater to a wide range of client needs
• Consider further branch office strategy in line with changes in the environment

Major metropolitan

areas

• Strengthen sales framework and enhance efficiencies by creating large branches
  Regional areas
• Maintain at least one branch in each prefecture
• Expand client approach throughtie-ups with regional financial institutions (Example: Business alliance with San-in Godo Bank)

			Kinki	18
Chugoku	31
	9	9
Kyushu/				Shikoku	4
Okinawa	11			5
12

Hokkaido

5 5

Tohoku

10 9

Kanto

86 56

Chubu

20 19

Consider branch office structure and optimize headcount allocation in order to improve service quality

16

3Wholesale initiatives: Improving productivity and profitability

• Productivity and profitability of secondary trading improved due to intense focus on areas of competitive strength and improvement in market environment

Productivity1of secondary trading business and pretax income2

Reduce lower profitability businesses,	Improvement in
focus on areas of strength	productivity

Recovery in secondary trading revenues contribute to improvement in Wholesale performance

(billions of USD)

Streamlining of direct costs and	Improvement in						1.5	1.5
Corporate	profitability
	FY2018/19	FY2019/20 1H (Annualized)	Wholesale	1.3	1.3		1.3
Pretax
revenues3			1.1
income	(Size of bubble corresponds to scale of revenues)	Origination
(loss)			revenues
			(Solutions,
			Primary and
			Advisory)					+22%
								FY19/20
			Flow					vs.
			secondary					FY18/19
Income			trading
			revenues,
			Execution
			revenues,
			etc.
Loss				Q1	Q2	Q3	Q4	Q1	Q2
	Productivity (revenues per producer) improved 60%	Pretax		FY2018/19		FY2019/20
		Productivity1
		Income			-2%			12%
			ratio

Wholesale costs

1.	Productivity: Revenues generated per producer	17
2.	Each bubble represents either Rates, Credit, FX/EM, Securitized Products, Equities Trading or Cash Equities
3.	Average quarterly revenues and expenses for FY2018/19 exclude goodwill impairment charge, business portfolio realignment costs and some non-core revenues and expenses

3Wholesale: Directions for consistent earnings and growth

Focus on enhancing efficiencies in existing businesses while cultivating new client relationships and deepening existing relationships

	Existing clients	New clients
			新規
	I		II
Existing products/Services	Existing businesses		Cultivate new client
(Core businesses)		relationships
	Focus on		Enhance provision
	areas of strength		of solutions to growth
	Enhance profitability		segment
客	III		IV
Develop new
顧
規	products and
新New
products/ Services	share by leveraging		New businesses
	services
	Increase client revenue
	technology

I

II

III

IV

• Downscale lower profitability businesses
• Focus on core products and large single markets
• Reduce costs ($1bn) and strictly manage resources
• Provide solutions to corporates
• Leverage Global Markets origination capabilities including fund financing businesses (infrastructure funds, PE funds, etc.) to create demand in origination business
• Jointly developAI-ledmarket-making platform for government bonds with other firms; Roll-out in other Fixed Income Flow businesses
• Updatee-Trading platform
• Launch digital assets custody business (Komainu)
• Control risk through alliances with other firms while exploring businesses that are highly compatible with existing businesses

18

3IIExpand Wholesale client base

• Steady expansion of origination business mainly innon-traditional financing businesses
• Focus on generating consistent earnings and positioning for growth by capturing new business opportunities

Expand origination revenues

Wholesale net revenue

(quarterly average)

+10%

Initiatives in origination business

1Growth of solutions business

		2	Advisory
	+4%	2	Primary
	-1%
Origination		1	businessSolution
business	+21%

	Securitization,
	financing related
90
80	1.4x
70
60
50
40
30
20
10
-
	2019年3月期2020年3月期
	FY18/19 (Quarterly average)
	上半期

Equity solutions

related

100	1.8x
90
80
70
60
50
40
30
20
10
-
	2019年3月期2020年3月期
	FY19/20 1H (Quarterly average)
	上半期

Secondary
trading
	FY18/19	FY19/20
		1H

2Strengthen ESG-related primary and advisory services

• Established Wholesale Sustainability Forum
• Underwriting for rapidly growing SDG bonds (green bonds, social bonds, etc.)
• Respond to diverse client needs related to ESG including M&A advisory

19

3ⅢUse of technology in Wholesale business

Initiatives to improve profitability and productivity
	2018	2019	Current	2020+
	Data collation, data cleansing and tool development
	AI-led flow	completed for utilizing AI
Clients	digitalization		AI engine deployment for flow products
	-Implementation near completion in European Rates
		-Fine-tuning underwaybased on feedbacks from trading desks
service		-Roll-out initiated for other products, e.g. USD Rates, JPY Rates etc
	Centralization of capabilities
		Consolidated existing quant, technology

	e-Trading			(development) and data science teams
			under single umbrella
	strategy
			Upgrade eTrading platform and Streamlining
					-Improve consistencyin pricing and execution
					-Addition of new products and increase of liquidityvenues,
					including ECNs
Internal
				Migration to a single client management system (CRM)
Automation			Global Markets completed, underwayin Investment Banking
initiatives	and			Introduction and roll-out of Smart 'bots'
enhanced			Partiallyautomated the collection of market and clients information
	efficiencies
			Generating cost saves byretiring legacyplatforms
					and redundant infrastructure

Improve

profitability of flow business

Increase share by improving clients service

Improve operational efficiency

20

Progress of cost reduction initiatives

• Over 60% of Y140bnfirm-wide cost reduction goal achieved as of September 30, 2019
• Towards FY2021/22, radically simplify operating model mainly in Corporate

Retail costs

(billions of yen)

Approx. 50% of target amount (approx.

Y30bn) achieved

Wholesale run-rate costs (Assumed revenue of $5bn)

(billions of USD)

Upper 60% range of target amount ($1bn≒approx. Y110bn) achieved

Completion of depreciation period for upgrade of main systems, system integration, etc.

309.8Approx.

40%

Consolidation of branch offices, reduction of ATM machines, reduction of Corporate allocation costs, etc.

Pay for performance, various initiatives, etc.

5.6

Instinet soft-dollar

Goodwill impairment charge, etc.

6.0Reduction in costs due to business portfolio realignment, reduction of Corporate allocation costs, etc.

290.0	Approx.	Approx.
10%	50%
	Reduction in	288.2

variable cost linked to revenues, etc.

accounting	0.2
change 15.4

			Variable cost
	5.1	corresponding to the
5.1	revenue exceeding
0.4	assumed revenue for run-
		rate costs
	4.8	0.1	4.7	0.3

4.4

FY17/18	FY18/19	FY19/20	FY21/22	FY17/18	FY18/19	FY19/20	FY19/20	FY21/22
actual	actual	1H		actual		1H
		(actual, annualized)				(annualized)
1. In conjunction with the application of Accounting Standard Update No. 2014-09 "Revenue from Contract with Customers from April 2018, gross revenues and related expenses for certain transactions have been	21
changed to net amounts. This resulted in offsetting of FY2018/19 revenues and expenses, leading to Y17.4bn reduction.

Rebound in current performance as a result of successful realignment of business platform

Net income (loss) attributable to Nomura Holdings shareholders per share1

(yen)

57.7

			40.7		36.3
			31.3		31.7
27.1	27.2	28.6	29.4	30.2
			19.3

11.0
1.3	4.3

-1.8

-7.8

-28.1

FY11/12

FY12/13

FY13/14

FY14/15

FY15/16

FY16/17

FY17/18

FY18/19

FY19/

20

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

2H

1H

1. Diluted net income (loss) attributable to Nomura Holdings shareholders per share

FY2019/20 3Q (Oct-Nov)

• Maintained 2Q momentum in October and November

Retail

• Impact of channel realignment largely finished, currently implementing actions in line with client needs in each area
• Revenues improved in October and November with November revenues a monthly high for FY2019/20
• Retail client assets(end-Oct)：Y118.7trn

Asset Management

• AuM(end-Oct)：Y54.1trn
• Revenues remains robust from last quarter

Wholesale

• Robust revenues mainly in overseas secondary trading (Rates, Equity Derivatives, etc.)
• Maintained 2Q momentum in October and November

22

Agenda

1

2

3

4

Businessrecap

Progress of businessplatform realignment

Future direction of our business

In closing

23

Future direction of our business

Continue to build out our financial and capital markets businesses

1		Face-to-face	2
Services
particularly for	Merchant
HNWI and	Investment
Banking
corporates
	banking services
			(Primary and
	Asset	Solution)
JuliusBaer	Management
	Servicesfor
Nomura WM
	institutional investors
Collaboration
(Execution, trading,
with regional	etc.)
banks
(Provide products)
Supply		Full-scale entry into Chinese market	Demand
side			side
(individuals)			(Corporates,
Enhance non-	Introduce AI	etc.)
face-to-face	engine to flow
services for mass	products	Digital asset
retail clients		custody
			(Komainu)
LINE		Develop and provide trading platform
Securities		for securitiesusing blockchain
		(BOOSTRY)
3		Digital	4

Core businesses Areas to enhance

Alliances with third parties to enter new business areas

1. • Deeper engagement with current clients, particularly
2. HNWIs
3. • Expandface-to-face business (Regional cities in Japan, Chinese market)
4. Grow client base and pursue new business opportunities through Client Financing & Solutions
5. Approaches to mass retail market in Japan (expand non-face-to-face businesses)
6. Enter new business areas using digital technologies

24

3Enhancing non-face-to-face businesses

• Set up Future Innovation Company in April 2019 and actively recruiting internally and externally
• Working to improve UI/UX of existing online services while expanding scope of business particularly in mass retail market

Future Innovation Company now fully operational

		Target clients
	5.33m	A	Face-to-face clients
	accounts	Clients not yet covered face-
		B
		to-face
UHNWI and		C	Collaborate with platformers to
corporates
	expand client base

HNWI	A
Mass
affluent	B	C

Expand client

Massbaseretail

Brought together functions from across the Group to

April 2019create cross-divisional organization: Future Innovation Company

• Increased headcount through internal recruitment
• Tapping expertise of external parties*

Today	Total of 80 people

*Background of external experts

• Executive at global tech firm
• Communication designer at a major advertising agency
• Former chief editor of economic business magazine
• App designer at major tech firm
• Financial sector representative producer at major portal website
• Service representative manager at major portal website
• FinTech manager at online bank
• Group leader at website production company
• Manager responsible for launching cryptocurrency exchange
• Employee at major consulting firm

25

Enhancing non-face-to-face businesses:

3Initiatives to tap into new client base

Approach clients with no investment experience through LINE Securities

Nomura Holdings		LINE Corporation
Extensive expertise in		Approx. 82m MAU1
securities business		in Japan
			DAU/MAU ratio2: 86%
				100%
			LINE Financial	Corporation
49%				51%

LINE Securities launched in August 2019 offering new

investment service via smartphones

Gradually expand service lineup

Currently offers 300 stocks, 15 domestic ETFs,

and investment trusts

Expanding Nomura service users via smartphone apps

Users	Users	Users	Users
	Information	Asset
	app	management app

…

		Online trading
Step 1	Introduce information and asset management
apps (planned for launch in 2020)

4m - 5mSubscription model where fees are applied in line downloads

Step 2with service level chosen by client (in app payment for services)

Step 3Chanel through price competitive online trading platform

1. Monthly Active Users 2. Ratio of daily active users (access at least once a day) among Japan domestic MAU

26

1 2Merchant Banking business

Enhance solutions that meet the needs of our clients

Client needs

Business succession

Capital restructuring

Strengthen management

Enhance enterprise value (rebuild core business)

Deepen private-sector industrial cooperation between Japan and China

(Japanese companies entering China, tap into inbound demand, etc.)

Fund	Investment	Fund value	Current status
method
			Invested in Orion Beer in March
			2019
			- Working to raise enterprise
			value (recruited external
			management, developing
			management and operating
Nomura Capital Partners Buyouts	Y100bn	platform)
			Invested in Plus Alpha Consulting
			in March 2019
			Solid pipeline backed by strong
			demand mainly from Retail clients
Japan-China Industrial			China's CIC and Japanese
		financial institutions signed MOU
Cooperation Fund
Mostly minority	Approx.	on strategic alliance to set up a
(China's CIC and
investments	Y100bn	fund in October 2018
Japanese financial
institutions)			Currently working to set up fund

27

Full-scale entry into China market: Received license from 12China Securities Regulatory Commission

Leverage our global resources

Nomura Orient International Securities: Start with HNWI business and enter wholesale business as second phase

Wholesale	Retail
Offer products and services	Expertise in
from our global franchise	businesses for HNWI
Cross-border transactions	and products such as
Research	SMAs

Build our platform	Expand business
2020	2021 - 2022
Headcount: Approx. 200	Approx. 400

Full license

2023

Approx. 500

Investment banking

IPOs

Financing M&A

China business

Synergies with Japan-	Provideasset
China Industrial	managementproducts
Cooperation Fund	using QDLP/QDII quota

Merchant	Asset
Banking	Management
Collaborate on	Corporate
internal controls,
risk management,	functions
etc.

Build platform and focus on growing HNWI client base

HNWI businesses

Brokerage

Asset management

Start wholesale

business

Institutional investor

businesses

Equities

Fixed income

HNWI businesses

Margin trading

SMAs

Brokerage

Asset management

Institutional investor

businesses

Equities

Fixed income

HNWI businesses

Funds

Margin trading

SMAs

Brokerage

Asset management

28

Closer collaboration with regional banks to expand 1securities business

Comprehensive business alliance with San-in Godo Bank for financial intermediary services to contribute to the better lives of clients and foster regional growth

Branch network centered on Shimane and Tottori

Alliance start (FY2020/21 1H)

Synergies

prefectures (81 offices, 69 sub-branches)

Provide Nomura Group securities



Offer the latest high-quality financial

Deposits, etc. Y4.2trn (end-Mar 2019)

platform

services to broad range of clients

Group client assets Y208bn (end-Mar 2019)

- Extensive knowledge of financial



Ensure efficient management and

products

consider investing to enhance

- Diverse products, services and

convenience and improve services

data

- IT infrastructure of security

Group client assets (billions of yen)

business

300～400

Investment trust

Public bonds

Gogin Securities

165

187

208

137

2016

2017

2018

2019

After alliance

Future image

(March)

(San-in Godo Bank Group and Nomura

(If synergies achieve)

Securities Matsue branch)

29

4Digital assets

Involved in upstream and downstream aspects of digital asset value chain

Upstream

Pre-trade

Execution

Post- trade

Downstream

Value chain

Origination, data,		Issue security token
etc.		Use blockchain technology

Trading

Settlement

• Custody

Security, reporting

• Established BOOSTRY in September 2019, a joint venture with Nomura Research Institute that will develop and provide a blockchain securities trading platform
• Established Japan Security Token Association (participants: SBI Securities, au Kabucom Securities, Daiwa Securities, Nomura Securities, Monex Securities, and Rakuten Securities) in October 2019 to realize security token offerings
• • Working to acquire certification asself-regulated organization by spring 2020
• Started joint research with Ledger and Global Advisors Holdings in May 2018
• Received license from JFSC in October 2019
• Conducted custody solutions proof of concept and aiming to start providing services in 2020

Global

Advisors

30

Agenda

1

2

3

4

Business recap

Progress of businessplatform realignment

Future direction of our business

In closing

31

Nomura Group Code of Conduct

Mission	Contributing to society |We help to enrich society through our expertise in capital markets
Vision	Trusted partner |As a leading financial institution, we aim to be the most trusted partner for our clients

Newly established

Nomura Group Code of

Conduct

Guidelines to put Nomura

Group corporate

philosophy into concrete

actions

32

ESG: Sustainable finance

• With the UN's sustainable development goals gaining recognition, we are seeing growing demand for SDG bonds (green bonds, social bonds, sustainability bonds, etc.)

Volume and number of sustainable finance issuances Nomura involved in

Examples and success of initiatives aimed at developing sustainable finance

(billions	of yen)	(#)
2,500		50
	Sustainability Bond
	Social Bond
2,000	Green Bond	40

International Capital Market Association

• Only Japanese firm to join The Green Bond Principles and The Social Bond Principles advisory council*
• • New advisory body set up to support the executive committee that sets the rules for the Green Bond Principles, The Social Bond Principles, sustainability bond guidelines, etc. and develop systems better aligned to market circumstances

1,500	# of sustainable	30
	finance issuances
1,000		20
500		10
0		0
	FY12/13 FY13/14 FY14/15 FY15/16 FY16/17 FY17/18 FY18/19

Published first index for Japan SDG bonds, NOMURA-BPI SDGs (November 2019)

Research group on

sustainable

development of ESG

bond market

Global Capital

Green / SRI Awards

2019

• Result of joint research with Nomura Research Institute
• Investment performance calculated using SDG bonds chosen fromNOMURA-BPI component universe based on certain criteria
• Set up by Nomura Institute of Capital Markets Research consisting mainly of external experts
• Issued research report in June 2019: The Era of Sustainable Finance - ESG/SDGs and the bond market
• Ranked second in Most Impressive Investment Bank for Asia Pacific Green/SRI Capital Markets

33

Disclaimer

• This document is produced by Nomura Holdings, Inc. ("Nomura").
• Nothing in this document shall be considered as an offer to sell or solicitation of an offer to buy any security, commodity or other instrument, including securities issued by Nomura or any affiliate thereof. Offers to sell, sales, solicitations to buy, or purchases of any securities issued by Nomura or any affiliate thereof may only be made or entered into pursuant to appropriate offering materials or a prospectus prepared and distributed according to the laws, regulations, rules and market practices of the jurisdictions in which such offers or sales may be made.
• The information and opinions contained in this document have been obtained from sources believed to be reliable, but no representations or warranty, express or implied, are made that such information is accurate or complete and no responsibility or liability can be accepted by Nomura for errors or omissions or for any losses arising from the use of this information.
• All rights regarding this document are reserved by Nomura unless otherwise indicated. No part of this document shall be reproduced, stored in a retrieval system or transmitted in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of Nomura.
• This document contains statements that may constitute, and from time to time our management may make"forward-looking statements" within the meaning of the safe harbor provisions of The Private Securities Litigation Reform Act of 1995. Any such statements must be read in the context of the offering materials pursuant to which any securities may be offered or sold in the United States. These forward-looking statements are not historical facts but instead represent only our belief regarding future events, many of which, by their nature, are inherently uncertain and outside our control. Actual results and financial condition may differ, possibly materially, from what is indicated in those forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the following uncertainties and risk factors, as well as those more fully discussed under Nomura's most recent Annual Report on Form 20-F and other reports filed with the U.S. Securities and Exchange Commission ("SEC") that are available on Nomura's website (https://www.nomura.com) and on the SEC's website (http://www.sec.gov); Important risk factors that could cause actual results to differ from those in specific forward-looking statements include, without limitation, economic and market conditions, political events and investor sentiments, liquidity of secondary markets, level and volatility of interest rates, currency exchange rates, security valuations, competitive conditions and size, and the number and timing of transactions.
• Forward-lookingstatements speak only as of the date they are made, and Nomura undertakes no obligation to update any forward- looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.
• The consolidated financial information in this document is unaudited.

Nomura Holdings, Inc.

www.nomura.com