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## Q7 What are your plans for the Wholesale business? 

A.  As noted in the medium-term plan, our fifth strategy is to “revitalize the brokerage business.”  As financial regulations are strengthened on a global scale, investment banks face a very challenging business environment. This is likely to continue, and therefore the Daiwa Securities Group has to concentrate on customer-oriented businesses that will allow us to elevate profitability and capital efficiency at the same time. 

The Global Markets business makes full use of our solid domestic customer base and global network to provide a diverse range of products while also driving cohesive and efficient operations in the Asian region. Specifically, we continue to efficiently provide value-added services that differentiate us from our competitors through the enhancement of an integrated sales system in Asia with Japan as its core and a pan-Asian research network. 

Furthermore, we are also working to “provide investment banking solutions that accurately capture client needs,”  which is our sixth individual strategy. Since our Global Investment Banking business is not tied to any of Japan’s large corporate groupings, by cultivating the sales and proposal capabilities of investment bank personnel 

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we can precisely address the needs of a broad range of clients without being limited by group affiliations, and propose optimal solutions. 

Leveraging the Daiwa Securities Group’s global network centered in Asia, including Japan, we will concentrate on supporting the efforts of Japanese companies to expand into Asia, and on offering investment banking solutions to leading companies in Asia. We also intend to improve cooperation between the four main bases of our M&A business—Japan, Asia, Europe and the Americas—in an effort to expand cross-border M&A consulting income. We also aim to diversify and maximize the earnings potential associated with M&A activities, focusing on associated activities like financing and foreign exchange trading. 

## Q8 As part of the plan to expand “stable” revenue, what targets has Daiwa Securities Group set for specific product segments and businesses? 

A.  We have identified the following revenue categories as “stable”: Asset management fees (including investment advisory fees), investment trust agency commissions, Daiwa Next Bank profit margin on interest, Daiwa Real Estate asset management fees, SMA / FW fees, interest from credit transactions, and LMS interest. To expand these income sources, we hope to increase the balance of assets under management in Daiwa Securities’ mutual funds by ¥800 billion, and the balance of assets under management of mutual funds at the two asset management subsidiaries by ¥2.6 trillion. 

## Targets for Increasing Stable Sources of Income 

Figures in parentheses reflect market assumptions 

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