Nomura Holdings, Inc. (8604) Earnings Call Transcript & Summary

[Interpreted] Thank you. I'm Okuda from Nomura Holdings. Thank you for attending our Investor Day event despite your tight schedule. Today, firstly, I would like to explain our strategy as well as initiatives we are working on. And then this time, we have division heads from 3 divisions, who will talk about their strategy as well as the current status of each business. Then let me begin my presentation. Firstly, in our U.S. operations, there was the incident that led to loss and we caused lots of concerns to you. And regarding the incident, let me briefly give you the overview of the status. On the 27th of April, when we announced our earnings, the related positions were unbound at 97% or more. And as of 10th of May, we've completed the unwinding up to 99% or more. So the process has almost been completed. Moving forward to prevent the recurrence of risk event, we will be thoroughly implementing measures and establish a mechanism to support our Wholesale strategy. So there is some explanation on the slide. But from the viewpoint of risk management, we have immediately checked whether there was any similar risks in the existing business, and we confirmed that there wasn't any similar issues. In addition, we have embarked on other measures for enhancement. And also, we've revisited the risk management framework for prime brokerage. And also by inviting external experts, we are now in the process of conducting comprehensive review. And also to enhance global governance at different committees, we have strengthened monitoring. And also, we are working on enhancing risk management mindsets on the ground of business in the U.S.A. So the person who has been the CEO of JPMorgan Asset Management, Mr. Christopher Wilcox, has been welcomed to Nomura as the CEO and President of local entity in the U.S.A. to strengthen our management structure. Under the strengthened structure, we will be working on the continuous expansion of our franchise. Now let me go to the next page. When I became the group CEO, I upheld the vision of propelling Nomura to the next stage. And to realize that vision, I struck out the strategy of expanding our business from public to private. So this is not a simple migration from public to private territories. So while strengthening and deepening the public products and services we have had, we will also enhance and expand the business portfolio in the area of private territories. So to clients to which we have provided public products and services, we will be providing new products in the area of private equity and other private areas. And by providing new products and services, we will create new business touch points with clients we didn't have access before. For example, pre-IPO financing services can be provided to start-up customers. And also, we can provide services and information and product to customers when they really need them. In the past, due to high cost, some services were accessible only to certain customers. But by utilizing digital tools, those services could be provided to those wider base of our customers at lower cost. What we aim to achieve is not just to grow in terms of product service and client and delivery. But by fusing all of them, what we aim to do is to provide customized services and solutions to each and every one of the clients. So that in a true sense, will be the private strategy. So towards the future, centering on private. We have to lay the groundwork and take on the challenges. And at the same time, it's important equally to generate revenue from the existing business. And we have limited resources -- and capital and human resources. So we have to have good balance and right allocation of power. So that requires important decision-making by the management members. Regarding existing businesses, if we continue with what we have done, then over time, the added values we can provide will decline. And at the same time, the level of customer satisfaction will come down. As a result, revenue will also come down. So to stop that kind of an outcome, we have to keep working on new things. As you see on the slide, bottom left, in areas where Nomura has the strong foundation, we will continue to strengthen and expand and improve the revenue. In addition, through various the initiatives listed here, we look to expand service and products and improve added values. For example, to retail investors in Japan, we look to provide customized advice, information and products to each customer. Specifically, CIO service and the Nomura navi and other services will be the tools to support private strategy for customers. And also on Monday this week, we made announcement about our consideration of JV establishments together with multiple regional banks. So by tying up with regional banks, remotely, we look to provide financial consulting services and take charge -- take fee from that. And on the 10th, we also made announcement about the strategic tie up with the large-sized investment adviser called Jarden Group in the area of Australia and New Zealand markets. Through this tie up, we look to complement with each other and contribute to the profits of the customers of each group. So far, at Nomura, we have conducted the expansion of business mostly organically. However, since last year, we have steered the firm towards the direction of tying up with third-party companies and improve the enterprise value of the firm. And also tomorrow is not a mere extension of today. That can be said about the financial services industry. So even if it takes time before we deliver results, we have to lay the groundwork for the future, and that's essential for the sustainable growth. To give you an example. Komainu and BOOSTRY, related to blockchain technology, they are examples. As you know, blockchain has the potential to drive innovation, more than the Internet. At the early stage, we paid attention to that and applied that technology to our business. In terms of strategic initiatives, we are adopting group-wide views. So to some areas or regions, we have strength in some products. In addition to them, newly developed products and services will be provided to customers in other regions, and we will do so with a sense of speed. So based upon such strategy, over the last year, we have implemented various measures. This slide shows a part of what we have done. On the upper side, you see the stage for the future. And as a stepping stone to the future, last year, by bringing together the contents within the group and other human resources in July last year, we set up a contents company. So differentiation through digital tools will diminish over time. And what will remain after that content and human resources? A content company, quality and originality of provided services will be enhanced. And at the same time, the content company is utilizing a digital strategy to provide information and also implementing measures to invite users. Of course, the tie-up with Wolfe Research in the U.S.A. and also other measures to enhance existing business is -- are underway. The U.S. stock-related researches provided by Wolfe Research is taken very positively by retail investors in Japan. And also in the U.S. Equity underwriting business, we have won deals, and we see many positive outcomes. The core business at the bottom, in other words, existing businesses. In 2019, we made a decision of conducting the reconstruction of business platform, and that resulted in the outcome or performance in the fiscal year ended March 2021. I will come back to this for more details later. Then next slide. Our market share grew significantly in multiple core products. The share expansion indicates the fact that we have a broad customer base, both globally and in Japan, also the capability of providing products. And as you see at the bottom, now the Wholesale business has enjoyed favorable market environment and has the business platform ready to generate a profit while leveraging the favorable market conditions. And also, in April, we established the Investment Management division. This division materializes that strategy that incorporates both existing business and a future vision. So IM division was established in the background where the environment of capital market and client needs are changing. And globally, interest rates environment is low, and that's continuing. And investment return is at a low level. So investor needs are diversifying. So too, by investor type, looking at asset allocation, the waiting of alternative investment is increasing. In other words, not just to issuers. But on the side of investors, in this current market environment, there are challenges that they are facing. Investment Management Division will not only offer listed Equities and Fixed Income, the conventional traditional asset class, but private equity and alternative asset investment opportunities to our customers. That is the aim. In January this year, we've announced strategic partnership with SPARX Group to establish investment company to invest in privately held companies. This is just an example of that. This is not simply investment in privately held companies, including retail customers -- to customers, we would like to offer investment opportunities in private equity and aim to enlarge market cap in pre-IPO situation and to extend our reach to high net worth through IPOs. And this includes various business enhancement opportunities. And that's why aircraft leasing is handled by Nomura Babcock & Brown, and it did not belong to any division, but has become a major company that is a member of this Investment Management Division. Multitude of expertise are gathered in one organization to create synergy and clinical reaction to enhance value added. In addition, including acquisition and inorganic measures in hiring investment team, we are able to utilize existing middle office and back-office functions to speedily start the offering of products and services. That is another aim. Regarding digital and DX. To enhance efficiency and sophistication, we are steadfastly improving digital through digital improvements. And at the same time, we are also addressing digital transformation. Similar to business expansion and strengthening, we will be introducing resource in a balanced fashion to strengthen existing technology and to adopt new technology. Regarding digital, hiring of DX talent and development of DX talent are also emphasized. In the United States, Wholesale CIO was hired. And in Japan, as an entry point for this future innovation company, it will be utilized. So far, I have described in rather qualitative terms. I would now like to discuss in more quantitative terms, including numerical targets and would like to discuss measures to achieve these targets. Up to March 2021, progress has been made. And Investment Management Division was newly established in April this year, and therefore, KPIs and KGIs for fiscal 2023 were partially reviewed. Regarding IM Division, towards the end of March 2023, the target is AUM of JPY 70 trillion. And at the same time, pretax income of JPY 60 billion. And excluding Investment revenue, core business income is to be raised from JPY 40 billion from fiscal 2021 to JPY 41 billion in fiscal 2023. In Wholesale Division, VaRs KPIs are revised upward. And at the same time, pretax income target will be raised from JPY 120 billion to JPY 150 billion. Towards the year ending in March 2025, the target of achieving 8% to 10% ROE remains unchanged. As shown at the right bottom of this slide, details of the strategies are given, and these will be explained by division heads later. In 2019, business platform restructuring was carried out in a decisive fashion. And as a result of that, as shown in this slide, in each business segment, revenue grew and cost was reduced, and at the same time, pretax income has shown substantial improvement. Regarding JPY 140 billion cost reduction plan, the plan was completed ahead of the initial plan, 1 year ahead of time this past March. Cost reduction efforts over the past 2 years have become -- have turned out to be very effective. And as shown here, cost income ratio has come down to 81%. Through enhancement of revenue and strict cost control, we aim to further reduce cost income ratio. First, with respect to the top line, strength of core product will be leveraged and through global partnership, businesses will be deployed to increase fundamental revenue-generating capability of existing businesses. To customers in Japan, we will be deploying new services by merging human and digital. To enlarge our customer base and to enhance our services, as need be, we will also promote partnership with other companies. And of course, we will be enhancing and strengthening private market business areas, which should also have positive impact on the revenue. Regarding cost control, we will continue to apply restraints. On the other hand, in Corporate division, digital will be utilized. Real estate and offshore center will be used efficiently. And branches, administrative operations throughout the nation will be consolidated to support sales, and more sophisticated transaction or account management will be applied. And the necessary investment for these, including enhancement of productivity will be considered. As a result, we further aim to decrease cost-to-income ratio. Regarding capital policy. At the end of March, CET1 ratio was 15.7%, despite seeing 7.5% required under the regulation and 11% internal target. Going forward, consolidated payout ratio of 30% will continue to be an important indicator, and total shareholder return ratio of above 50% remains unchanged as shareholder return policy. Regarding the use of surplus capital. Depending on how development -- how regulations will be developed -- developing regarding Basel finalization, and in view of our growth investment to establish sustainable business foundation, and in view of greater shareholder return, in a balanced fashion, we would like to implement dynamic flexible capital policy. Regarding the Board, that makes important decisions of the group and supervises the management from the perspective of diversity. And at the same time, as our business portfolio in the group is expanding, we plan to invite 3 new outside directors from outside of Japan: Hong Kong International Investment Company, First Eastern Investment Founder, Chairman and CEO, Victor Chu; former American Commodities Trading Committee Chair, Christopher Giancarlo; and New York Fed -- over 20 years at New York Fed and currently, Columbia University MBA Program Director, Patricia Mosser. These 3 are candidates for new outside directors. And with fees at the holdings level, Board will comprise of 12 directors, amongst of them, 8 are outside directors, 3 are women and 4 are known Japanese nationals. So the Board will be very diverse and open. Lastly, I would like to touch upon sustainability efforts. This is one of the major factors for us to be chosen by our clients. Without sustainability, in the future, we believe that there is even a risk of losing businesses. Our efforts in sustainability is growth strategy for ourselves as well as for our customers. Including customers to wide-ranging stakeholders, we will be utilizing various functions within the group to offer solutions to address social issues, and we will continue to enhance these efforts. And general improvement of financial literacy in the society will not only lead to asset formation and enhance the living standards, but will also lead to development of healthy capital market and circulation and funds. For over 20 years, Nomura Group has made efforts to promote and enhance knowledge and understanding amongst the individuals of financials and economics, and have engaged in financial economic education to people across different generations. We are providing courses in the universities, which are attended by about 270,000 students. In Nomura Group, I Chair Sustainability Committee, and the membership of the Sustainability Committee is made exactly the same as the membership of the highest decision-making body executive management Board to strategically drive sustainability efforts. Outside Director Candidate, Mr. Takahara, President of Unicharm, included from outside directors from various different angles, advice will be offered regarding our efforts in sustainability area. Furthermore, this time, a new position of sustainability promotion as a director position was established to increase awareness in the group and to strengthen our efforts and to accelerate dissemination of information and external communication. And in appointment of new directors and in the hiring and development of talent, we will apply group by perspective and diversity will also be emphasized, including gender, age and career. Our management vision is to achieve sustainable growth by helping resolve social issues. As a group, we are engaged in diverse businesses. These businesses are only possible because of the trust from stakeholders, including our customers. I believe that the enhancement of our enterprise value and sustainable growth of the entire society are on the same pathway. We are determined to continue efforts to realize sustainable growth. That concludes my initial remarks. And regarding the growth strategy, the heads of 3 divisions will present. Thank you for your kind attention.

[Interpreted] Next, from Retail Division. Mr. Arai will present. Mr. Arai, please go ahead.

[Interpreted] Thank you. This is Arai from Retail Division. Thank you, everyone, for your support, the day-to-day. And I'd like to take time to explain our strategy implemented so far as well as the results we could achieve and also, I'd like to talk about the future strategy. The first slide shows the chart that was used by Mr. Okuda a year ago at the Investor Day. This shows what Retail Division will do over a 3-year period. In March 2020, the organizational change was implemented. And in March 2021, existing business productivity improvement was conducted. And so that we can conduct the full-scale business shift this year. What we aim to do is to -- providing advice and consulting to the entirety of customer assets and satisfy more customers. And in order to do so, in addition to strengthening private strategy, we would like to merge person and digital and establish new business model with a sense of speed. As a result, we will be continuing to establish a mechanism of structure to expand business in a sustainable manner. According to this chart, this fiscal year is the phase where we conduct a full-fledged business shift. But over the last 2 years, we have transformed our business steadily, and we are prepared to accelerate the transformation this year. Especially the last one here, due to COVID-19, there were various hurdles. But in order to conduct a full-fledged business shift, we could lay the groundwork faster than we initially anticipated. So now over the last few years, we have very -- implemented various measures, which I would like to explain. As the core of private strategy, we've conducted channel formation revision. On the left, you see that based upon the needs of individual customers, we have reallocated and assigned sales partners. Our sales staff are called partners, so I will use the term sales partners moving forward. In order to establish this structure over a 2-year period, we revisited the allocation of partners to 1.5 million or more of customers. And for the purpose of revising the sales partner allocation, we've conducted consolidation of retail branches in Tokyo, Nagoya and Osaka, and more than 30 branch -- to be consolidated, targeted 2 years ago was exceeded, and we consolidated 35 branches. And this puts some burden on customers that moving forward, we will be enhancing the level of services to customers. And also moving forward, we do not have the intention to conduct this kind of drastic change. And based upon needs of customers, we will be conducting individual changes here and there. Now just revising the partner allocation to customer, I cannot fully meet the needs of customers. So in order to enhance the expertise of sales partners, we have been conducting various measures. So while accelerating the efforts of partners to actively enhance their expertise, in addition to the number of partners, who's won a license such as analysts and financial planners, over the 3 years, more than 500 partners won real estate transaction licenses. So that means we have a widening base of partners that's focused on consulting-based services for customers. And also, we are enhancing functions of contact centers. Now we've had 3 contact centers, but we've increased the number to 7 contact centers. And in addition to take the services to take phones, and they now have that team to provide, otherwise based upon the interview with customers. Now this team has 120 members, but they will be increasing the headcount. And the now Retail Division's newly hired freshman employees are assigned to contact centers. But by expanding the touch points with clients, we can look to have deep consulting services in the future. So this -- what we are doing is to solidify the base. So in addition to what we've done, in order to shift to a new sustainable business model, we have implemented various measures, thereby expanding the services to meet the needs of customers, we have achieved several results. For example, Wealth Management group, supporting business owners in Tokyo, Nagoya and Osaka. Based upon needs of customers, the team has provided a proposition of various solutions. As a result, the ratio of revenues related to the revision of securities related to capital policy and in real estate transaction and the pension and wealth insurance solutions increased 1.6x over the 3 years and now representing 1/3 of the total wealth management revenue. And also Wealth Management division, we will tighten and strengthen collaboration with IB department so that it can provide various proposition of solutions to listed companies as well as the owners. And in doing so, while satisfying customers, the business is being expanded. In addition, that we are putting focus on services to executive officers of listed companies. And a case in point is in the -- at the time of introduction of restricted stock-based compensation, we see the spike in the number of accounts opened among executive offices. Now more than 900 companies have introduced RS, restricted stock. And our market share is 45%, and 24,000 accounts have been opened related to RS-related transactions. So in addition to providing services to these new customers as an entirety of Nomura market -- Nomura Group, we are placing more focus on the workplace-related market. Looking at employee stock ownership plan, our share is more than 40%, and we have 1.8 million plus members. So by utilizing contact center and digital tools, we will be enhancing our services. And also across Japan, with our retail branches, we are covering corporate owners and high net worth individuals. To them, we are aiming to provide consulting services to cover the entirety of the asset. And our partners are making efforts for that purpose. As you see here, the number of the unacquired corporate owners has grown rapidly in the last 12 months and also the number of consulting contracts with corporate owners and high net worth individuals has steadily increased and has reached 26,000 over the last 1.5 years. One result we've achieved in the area of consulting other than securities is that in the area of real estate transaction in 2020 has reached JPY 175 billion. And also in the sense of products and services, we see outcome. For example, 1.5 years ago, we started services by equity center called Nomura equity premium service. This is a service where equity-specific advice is provided to customers who has needs related to equity. And as you see, the graph at the bottom right, we see the growth in the track record and it's growing into the core servicing equity product. Now as we saw at the earnings release on April 27. Last year, our revenue was to JPY 368.8 billion as Retail Division, and pretax income was JPY 92.3 billion. And the customers' account asset was JPY 126.6 trillion. That's a record high. And the recurring asset was JPY 18.2 trillion. However, these results were partially supported by the positive market factors. On the other hand, what we are valuing is not the numbers as a result, but the process that we took to get to the number. In that sense, we are putting focus on KPIs. For example, on top right, consulting-related revenue, not just the impact of the COVID-19, but due to the fact that the limitation on solutions we can provide, we couldn't reach target. But as you see, you see the rising trend. And as I explained, number of consulting contracts is growing stable -- in a stable manner. So we are expecting consulting-related revenue to keep growing. Also, the number of buying customers is a key KPI, that shows the number of customers which -- who are receiving our service. And we are a bit below last year's level. On the other hand, if you look at customers that are not limited to buying transactions, then the number of customers has grown by about 3% year-on-year. So even amidst the COVID-19 situation, we are making steady progress toward the goal of providing services to a broader customer base. Now based upon these initiatives implemented, and based on the results we've achieved, I believe we are solidifying the business shift foundation. And moving forward, we will be conducting full-fledged business shift. But what we are considering in terms of business shift is that we will be switching from securities business to consulting business format that focuses on -- that looks at the entirety of assets. So we'll be making the evolution of the business format. And while achieving evolution, we would like to provide services to more customers. So from here, I would like to explain key 3 measures, which we will focus on to achieve evolution. First, we will emphasize strengthening of private domain strategy further. Earlier, I've mentioned that we have assigned sales partners that can cater to the needs of different customers. Regarding asset management, based on the customers' risk appetite, to propose high-quality portfolio, we will collaborate with content company to adapt CIO model. Already from fall last year in discretionary investment service, CIO model was introduced to improve investment performance. Not only that, we plan to use CIO model in wide-ranging services that we offer. Nomura navi trial was started internally. And for this as well, CIO model will be utilized. Nomura navi will go through trial this fiscal year and will be introduced on a full-fledged fashion next spring. This is a consulting tool. This diagram shows the concept. With this tool, sales partners are able to not only propose portfolio appropriate for the customers, but depending on the changes in the market overall and greater standing of individual securities, partners will be able to propose portfolio revision and removal or addition of individual securities. To cater to different customer needs, we also plan to introduce multiple fee schedules. In addition to conventional transaction-based fee, [indiscernible] fee or so-called level fee introduction is what we expect. Trial has started this April. And next spring, we plan to offer this to wide-ranging customers. Our level fee will apply multiple -- multiplier for each asset class of securities such as stocks, bonds and investment trusts based on balance. And we will not receive a conventional transaction fee. This mechanism aims to enhance customer satisfaction and thereby, increase AUM. CIO model, Nomura navi and level fee are measures to increase customer satisfaction, mainly in financial asset investment, but we also aim to offer advice in consulting services for the entire assets, and we are implementing measures towards that end. In order for us to offer consulting services for the entire assets of each customer, each individual partner capability may sometimes not be sufficient and therefore, already partners have been using functions in and outside of the company to offer services to customers. Going forward, to increase the number of customers, we will be providing services through teams. For example, in the Wealth Management Group already, there is a team approach adopted, including with PB department and relevant departments of head office. Starting this fiscal year, this team approach will include sales partners who cover corporate customers and owner customers to enhance service. Wealth Management Group is an emphasis -- strategic emphasis group in the division and resources have been invested. This will continue. Going forward, Wealth Management group will further strengthen its collaboration with IB to enlarge businesses. And will explore business opportunities in private domain, in products and services to carry out R&D functions for product and services. Through this, we aim to differentiate our products and services that are offered through our branches throughout Japan. The second area of focus going forward is to establish new business model that merges human and digital. With respect to the use of digital, to be honest, I cannot say that we have been able to do this efficiently. In order to conduct sales activities in a more efficient fashion, we have introduced digital technologies proactively, but it may have not been sufficient in terms of developing digital services that will lead to customer satisfaction. However, at the same time, with digital alone, we believe that it will be difficult to provide advice and consulting for the entire assets of the customers, which we aim to achieve. And therefore, based on the foundation of digital, when customer needs it, our staff can provide advice and consulting. We would like to establish that to business model. Customers will be able to acquire our valuable information online. But when in-depth consultation is necessary, our partner will cater to the customers in-person or remotely to address asset-related issues of customers. That is the concept that we have. In order to establish such new business model merging human and digital, we have already established a team at the head office. And starting from this fiscal year onward, we plan to invest about JPY 10 billion annually for systems and operating spend. Nomura online service level should be enhanced so that it will lead to satisfaction of the customers who can conclude their transactions digitally. The third focus is to offer services to even increasing number of customers. And one of the measures to achieve this is establishment of new business model merging human and digital, but we will be implementing other measures. For example, division of labor that we have been able to establish through our efforts at contact center, the contact center as shown here. We will interview customers together, customer information that is necessary to offer consulting service. And based on that, life planning and asset management proposal will be made by 2 different partners with the division of labor system. Through this division of labor, clearly customer satisfaction was enhanced. And at the same time, business operation efficiency was improved. This division of labor will be expanded to the head office and branch office. And by providing service in collaboration with contact center, we believe that it will be possible to offer higher value-added consulting service to more customers. And to deliver services to more customers, we will strengthen our partnership with business partners. As we explained several times on the previous occasions, we have started business alliance with San-in Godo Bank and Awa Bank to deliver financial services to customers in the local communities together. Services already launched with San-in Godo Bank and at a pace faster than original expectation, stock asset is increasing in net terms, accounts are opened and cumulative investment contracts are executed. We are seeing steady progress. And service from Awa Bank is now offered from the end of -- starting from the end of April. And through these, we will continue to offer excellent financial services in each respective local communities. In a different way with the regional banks, we are planning to establish joint venture under a new concept with Chiba Bank, Daishi Hokuetsu Bank and Chugoku Bank, as we announced last Monday. In this new company, expertise of our security services and banking services expertise of partner banks will be gathered together. And with a keyword of neutrality and completely remote and dedicated to providing advice, we will be providing financial services that will be useful for customers. We will offer information online and with e-mails and remote interviews. In an interactive fashion, high-quality advice and consultation will be offered for free. So this will be a new business model that we will try, which does not involve intermediation of financial products or banking agency. And with this new company, we believe we will be able to gather knowledge that, that will be useful in the future business development. With line securities, we have been collaborating so that we are able to extend the base of customers in the securities and to acquire knowledge from the platform. Already 600,000 -- over 600,000 accounts are opened. And we will be expanding services. We will start by offering Nomura iDeCo from May, and we will continue to explore various possible services. Thus far, as I have explained, we have been making steady progress in our collaboration with business partners. We will continue to drive this strategy going forward. And to collaborate with new business partners in speedy and easy fashion, as shown on the right diagram with Nomura Research Institute, new financial instruments intermediary platform is to be established as we announced the other day. And by next March, we plan to build this platform. That concludes my presentation. I look forward to receiving your questions and comments later.

[Interpreted] Next presenter is Mr. Ashley from Wholesale Division. So Mr. Ashley, please go ahead.

Good morning, everyone. My name is Steve Ashley, and I lead our Wholesale Division here at Nomura. I'm pleased to be joining you today from our New York office. Our group CEO has already updated you on the actions taken in response to the recent incident here in the U.S. So I will now focus on sharing this update on our business progress and strategy going forward. Our vision for the Wholesale business is simple: to deliver excellence for our clients and to drive value for our shareholders. To realize this vision, we built our strategy around 3 fundamental principles: stability; achieving robust, high-quality earnings across market cycles; diversification, broadening our business mix and client offering; and growth, strengthening our core wholesale platform and expanding in new fast-growing markets that address clients' evolving needs. We've set clear and achievable targets in each of these areas. And today, I will walk you through our plans to realize this ambition. Now turning to the first slide. It's been just over 2 years since we repositioned our business and announced a new strategic plan at our 2019 Investor Day. At the time, we took 3 decisive steps. We narrowed and focused our business scope, concentrating on fewer products and deprioritizing areas where we could not compete. Secondly, we announced plans to diversify our business into new growth areas, including the fast-growing private markets. And finally, we announced a major cost reduction plan in partnership with our Corporate division. Our actions have borne fruit as we've seen a steady increase in pretax profitability in our core business quarter-by-quarter, excluding the exceptional items due to COVID and the U.S. client incident. And I'm pleased to say that an increasing proportion of our profitability has been driven by our international business. Back in 2019, we also set ourselves 3 management KPIs, fully aligned to our goals of business stability and revenue diversification. Firstly, revenue over risk-weighted assets, a measure of our ability to generate a healthy return on resources. This has been in excess of our 6% goal in each of the last 2 fiscal years. Secondly, our cost income ratio. If we look at our underlying performance, this has also materially improved in the past 2 years, thanks to our cost management efforts across the firm. And thirdly, growth in fee and commission revenue, our diversification metric, which is well in excess of the 15% growth target, thanks to the steady progress in our wealth, advisory and Instinet business lines. And key to our strategy is the idea that we compete only in markets where we can have an edge. In other words, where we can offer a truly differentiated proposition to our clients based on the strength of our research origination, structuring and execution. In those markets where we've chosen to compete, we've built critical mass, substantially grown revenues and reached market-leading positions. As you can see, we can now boast leadership positions, not only in Japan, but also in each of our international regions. That's allowed us to dramatically upgrade the quality of our business portfolio. And where necessary, we've exited or substantially reduced business where we did not have a real advantage, reducing the drag on performance. Turning to Page 3. I talked about stability as a cornerstone of our business strategy. As a global market maker, we are naturally exposed to industry cyclicality. And candidly, that can never be fully neutralized. Therefore, it's critical for us to increase the quality as well as the quantity of our revenues. Key to that plan has been revenue diversification into areas with lower volatility and a reduced dependency on financial resources. In private markets, we've grown revenue 16% per year since '18/'19, and achieving a top 5 or 10 league table positions and RMBS Bank of the Year in 2020. I will talk through our plans in wealth management and advisory in a moment. But I'd also call out the progress on our Instinet platform, where expansion and execution revenues has been reinforced by growth in our software business. While diversifying our product mix, we've also deepened our penetration with our core priority clients, up 7% in each of the past 2 years. And finally, building our cross-regional revenue bench is critical to delivering our connecting East to West proposition. That number has increased over 20% since 2019, a major milestone for our platform. And on Page 4, as we look ahead, the key question is, what is our underlying firepower as a franchise across market cycles? We believe that number to be around JPY 130 billion in pretax income. If we look at our normalized run rate over the past 2 years, our core underlying performance has, in fact, been substantially higher. However -- but also allowing for a degree of normalization, particularly with market's fee pools, expected to reduce around about 16% this year. At this run rate, we feel comfortable that we can achieve or exceed all of our management KPIs. Going forward, we are confident that we can exceed our existing pretax goal and have, therefore, increased our target to JPY 150 billion. In the medium term, we see further growth, driven by expansion into areas such as private markets, advisory, wealth management and digital. Each of these areas are completely aligned to our strategic principles: building stability, diversification and growth. For each area, we've laid out clear medium-term goals against which will track our progress in the coming years. And underpinning this plan is our commitment to maximizing cross-divisional linkages across the firms and expanding our efforts to be a leader in sustainable finance activities. In terms of growth in private markets, it's a harsh reality that many of our traditional markets have been challenged by fee pool and margin compression over the past decade. In contrast, private market activity stands out as a beacon of consistent growth, with AUM more than doubling since 2012. And with around $2.5 trillion of dry powder committed by investors, we expect further growth across these asset classes in the next few years. Private markets has been a critical part of our Wholesale strategy for some time now. And put simply, it ticks many boxes. It diversifies our strong security trading business and naturally exhibits much lower market volatility through the cycle. And it complements our structuring and solution business lines, where we can differentiate ourselves through bespoke transactions for our clients. For those reasons, we have steadily allocated more resources and investment to these activities. And as a result, the business has grown 30% in the last 2 years with a very strong contribution to the bottom line. We've built an impressive track record in infrastructure power finance, structured lending and private placements over the past few years. And we have concrete plans to extend this growth over the coming year, targeting revenue growth of greater than 40% in the medium term. We are developing new businesses such as commercial real estate finance and trade finance. And we'll also pursue growth in nonrisk businesses such as debt advisory in the U.S. and EMEA and equity private placements globally. And finally, we will build upon our strategic alliance with SPARX Group, alongside our Investment Management Division, to drive the provision of growth capital from individual investors to unlisted companies in Japan. With regards to the advisory business, 2021 was a watershed year. We increased revenues 27%, posting our strongest performance in a decade. We increased our global M&A market share to 5.9% and secured an 11th place global ranking. And we successfully integrated Greentech Capital Partners (sic) [ Greentech Capital Advisors ] into our global platform. Investment Banking is a long-term investment business, and we are committed to continuing this growth trajectory over the next few years. We intend to target high-growth sectors such as health care, TMT, clean energy and infrastructure, leveraging our Nomura Greentech and infrastructure platforms. And we'll look to expand into fast emerging sectors, such as digital assets, while maintaining our existing strengths in established sectors. While we continue to invest in each region, we are particularly focused on gaining further scale in our Americas business. And I do expect other regions to benefit from the stronger U.S. platform. Ultimately, we aim to grow by over 50% over the next 3 years in advisory revenues. Now turning to wealth. We took 2 decisive steps over the past year to build out our platform in Asia. The first of those was to integrate the unit into Wholesale, allowing us to deepen our product offering across structured products, financing and derivatives. The second was to hire new leadership for the business and commence a systematic plan to rapidly build the platform and the talent base. We set an ambitious target for the business to achieve threefold revenue growth and increased AUM by 5x over the next few years. We've already achieved a lot. We hired 25 relationship managers across our key markets, and are targeting at least 40 more in our expansion plan. We are deepening our institutional product suite to meet the more sophisticated needs of our client base and expanding our private markets offering, in line with our overall approach in Wholesale. And lastly, we are making significant investments to upgrade our platform infrastructure and build out our support team. Key to our continued success is our one-firm approach, connecting our wealth management platform to our markets, banking and IMD verticals. Back at our Investor Day in 2019, we spoke about a nascent project to tap into the emerging digital asset market. At the time, the proposition was considered novel and even unique, an institutional grade-level custody platform called Komainu. 2 years later, that platform is now live with over $4 billion of assets under custody and a successful Series A fundraising from key strategic partners. That experience in solving the custody challenge has proven invaluable in deepening our expertise in this asset class as well as establishing our presence and credibility in this developing market. On the issuance side, the BOOSTRY platform, a JV between Nomura, NRI and SBI Holdings in Japan, successfully issued digital blockchain bonds directly to investors last year. I believe the digital asset market is now reaching a tipping point, both in terms of institutional and regulatory acceptance. And as the asset class matures, we are determined to stay at the forefront of the market. We believe this strategy fits neatly with our goals of promoting greater inclusivity and transparency in society. As such, we will look to build out our presence over the next few years and explore ways to expand across the value chain. And we will target at least $100 million in incremental revenues as well as additional valuation gains in our portfolio investments as part of this plan. Over the last 2 years, we made a decision not just to adopt sustainability as an initiative, but to embrace it as a core pillar of our future business strategy. Our acquisition of Greentech Capital was a signal of our intent and a key milestone for our franchise. And we are already driving significant mandates on the platform across a wide range of products. Stepping back, it's fair to say that this past year has been a turning point in terms of our sustainability efforts. Here are just a few examples. We facilitated green, social and sustainability bonds for $62 billion in the last calendar year, including acting as joint book runner on the EU's inaugural EUR 17 billion dual-tranche social bond last October. We launched our ESG Sectoral Appetite Statement to manage environmental and social risks as we look to grow our ESG credentials. We were awarded Investment Bank of the Year for Sustainable Corporate Finance by The Banker, a tremendous recognition of our efforts. And finally, we received ESG rating upgrades by 3 different agencies. This is just a starting point, though. We are building on core strengths across Nomura Greentech, our infrastructure and power financing business, which is largely financing renewables and our debt capital markets business. Our ambition is to be a leading investment bank, operating at the forefront of sustainability services. So we want to continue to expand our existing efforts, but also tap new areas of opportunity across each of our business segments. Finally, I wanted to end on the point around cross-divisional collaboration. In reality, the word "division" is a misnomer. Our businesses are heavily interconnected and many of the themes we discussed today, such as private markets and sustainable finance, span across client segments and channels. We are also embracing strategic alliances and partnerships with third parties, such as our alliances with a Wolfe Research and the Nomura-SRI Innovation Center in the U.S. Just recently, we also announced our alliance with Jarden in Australia and New Zealand. Close collaboration across the Nomura Group and with our partners is essential for our Wholesale business, and it will continue to be integral to the success of our medium-term plan. So finally, I would like to leave you with 2 key messages. Firstly, our core platform remains strong and robust. Our client platform continues to grow across each of our segments. Our business mix is more stable and it's more diversified, and we are achieving our targets and KPIs. Secondly, we are firmly positioned for growth. Our investments in the past few years are already paying dividends. And we will continue to build in our target areas such as private markets, advisory, wealth and digital. We remain committed to our social goals and are placing the sustainable finance agenda firmly at the center of our strategy. With that, I would like to thank you for your time and attention today.

[Interpreted] Next presenter and the last presenter is Mr. Namura from Investor -- Investment Management Division. Mr. Namura, please.

[Interpreted] I'm Namura, the Head of Investment Management Division, established in April. I would like to explain our division strategy. Firstly, let me start with the environment around the asset management industry. On the left, you see the investors' perspective, the changes in the investment environment. Top-left graph shows the progress of the bond yield. But bond yield has been at a low level. Because of that, many investors are facing difficulty in securing investment return. The bottom-left chart shows that in order for the institutional investor to secure yield, they are increasing the rate of alternative investment. And the next on the right-hand side, the perspective from the asset management firms, changes in environment. Top-right graph shows the changes in fee level. But both for active and positive investments, the fee level trend is expected to continue. And the bottom-right graph shows on a global basis, alternative and the nonalternative progress of a -- at fee levels. But moving forward, we expect fast growth in alternative investment area. So yield to be secured by investors and also the fee to be secured by asset managers. From those 2 perspectives, the expansion of alternative investment is perceived as important challenge. So based upon that environment around the industry and also in order to provide diversifying asset management needs of investors, our Investment Management Division was newly established. And from traditional asset to alternative assets, the division has various entities that has a wide range of track records within Nomura Group. While ensuring and securing independence of the firm, we will pursue -- highly sophisticated expertise. And through leveraging holistic power of Nomura Group, we aim to grow. In addition, based upon the experience of inorganic business, we would like to promote the business through flexible capital policy. So this shows main investment and asset management firms that belong to the Investment Management Division. Nomura Asset Management is an asset manager that conducts a wide range of business from traditional assets to alternative investment from both inside and outside of Japan. And Nomura Corporate Research and Asset Management, namely NCRAM, is an asset manager that invests in high-yield bond market. Wealth Square provides fund wrap services through financial institutions. And Nomura Capital Partners makes an investment into private equities using its own capital. Nomura Mezzanine Partners manages and operates mezzanine funds. And Nomura Babcock & Brown provides business investment opportunities through the structuring of international aircraft lease transactions. The division's AUM as of end of March 2021 was about JPY 66 trillion. Next, let me explain the organizational structure as well as group's holistic power for the growth. In terms of organization, by securing independence of individual investment firms within the group, we try -- we aim to achieve competitive performance and expand our products through that high advancement of investment. And also collaborating through various firms, we look to expand customer base. And also by sharing the operational processes across entities, we look to achieve improvement in efficiency. And also by centralizing the divisional strategy, we look to accelerate the speed of plan development. In these initiatives, we would like to leverage the functionality, knowledge and network of Nomura Group and affiliate companies so that we can leverage the holistic power and pursue further growth. Now let me introduce the financial targets that we aim to achieve as a division on the far-left graph. Last year -- so former asset management division's pretax income is divided into investment gain and the noninvestment business gain. The second-from-the-left graph shows by hypothesizing that the Investment Management Division was in place last year, we conducted this pro forma-based profit. Last year, due to the improvement in market environment, so investment profit trended at high level. On the other hand, excluding the investment profit, noninvestment business profit was JPY 40.8 billion. At Investment Management Division, in the fiscal year ending March 2025, the cruising speed, AUM of JPY 80 trillion and pretax profit of JPY 80 billion, and business profit excluding investment profit of JPY 55 billion are set as targets. And from next slides, I would like to explain how to conduct our business to achieve the targets. In order to achieve the targets, we have to grow the existing business in a stable manner. At the same time, we have to launch new businesses. And by adopting inorganic strategies, we have to expand client base as well as product offering. As for existing businesses, we aim to grow revenue in a stable manner, centering on investment return and investment revenue. On the right, we see areas we will strengthen. We look to increase our share in public investment trust market. And we look to expand investor base in ETF, and we look to deepen ESG strategy and intensively allocate resources to the flagship strategy. And we look to collaborate with American Century Investments to grow business further. At the same time, we will work on new business and investment business so that we can develop new businesses and pursue return from investment. Specifically in new areas, we are looking to expand the business lineup in real assets such as the expansion of Asian investment trust business and also the enhancement of investment capabilities in the area of private market. And also the strategic expansion in private equity, debt and infrastructure in terms of investment business. So fund investment as part of new business and also selective investments into quality and companies will be conducted. Starting from the next slide, I would like to discuss existing businesses, starting with our measures in the public market business. With respect to ESG, in the investment process, ESG is integrated. Furthermore, [ fierce ] ESG investment strategies will be developed. As for ETF, we will be covering retail customers to institutional investors with the structure now in place, where we are able to make wide-ranging product proposals and conduct marketing. Last September, one of the largest in -- ETF in Japan, TOPIX ETF fee was lowered. And fee schedule was reviewed -- revised so that fee will be lowered based on the balanced -- size of the balance for the greater benefit for our investors. In active investment, we are focusing resources on flagship strategy that is globally competitive, and we will promote multichannel deployment in and outside of Japan. Further, using digital, we will implement transformation with -- in a speedy fashion. In sales, we will introduce digital marketing to strengthen our support of sales companies. And in investment, with the use of technology, passive investment efficiency will be improved, and we will also develop investment strategies using advanced technologies. Now I would like to turn to alternative platform. Infrastructure, real estate, commodities included in real estate area and products in this area. Nomura Asset Management is collaborating with external managers to offer investment opportunities and further opportunities will be provided and the products will be enhanced through collaboration with external managers. In leasing business, business opportunities -- business investment opportunities will be explored. Regarding private market investment strategy, I will touch upon this on the next slide, but we will continue to review and implement the launch of new businesses. There are businesses that had already been launched, and we will make them fully operational and active as soon as possible. And we will also aim to enhance revenue from existing businesses. As examples of businesses in the private market domain, 2 new businesses, launch of which were announced this year, with the expected start of investment before the end of the year. First is investment into private health companies through establishment of listed investment company. On April 1, Nomura, SPARX investment was established as a joint venture with SPARX Group. Investment company will be listed on the venture fund market of Tokyo Stock Exchange. And after that listing to wide-ranging investors, investment opportunities to privately held companies will be offered. And second is an agreement with Japan Search Fund Accelerator, JaSFA, to jointly manage search fund. Search fund is a mechanism where a fund will invest in individuals who wish to become business managers, who are called searchers. Searchers will search and find an SME and that SME's management right will be acquired. This is a new form of business succession. Leveraging Nomura Group's network, we would like to enhance corporate value of companies that have issues with business succession. And through this effort, we would also like to contribute to sustainable development of local economies. Now I would like to touch upon enhancement of businesses. In deciding entry into new business, we will consider product potential, market potential and growth potential. And we'll also determine -- we'll look at the competitive landscape before determining the entry. We will also consider whether we can have competitive advantage, leveraging synergy and know-how as Nomura Group. Regarding inorganic strategy, we will consider diverse options, and we'll aim to achieve growth in efficient fashion that will contribute to increase in revenue. We will also consider collaboration with external managers, alliance and acquiring of subsidies through majority investment. And we'll select the appropriate approach. To enhance product lineup, real asset lineup will be enhanced by entering into infrastructure area and expand business opportunities through leasing businesses. We will also increase strategy to develop further strategy in private equity and that through collaboration with fund of fund's external managers and through alliance. To expand customer base, we will utilize our group companies outside of Japan, partners and third parties to strengthen our sales network. And we also plan to strengthen distribution outside of Japan, especially in Asia. We also will be further developing marketing platform using digital media to target younger customers. In inorganic growth, we have built a steady track record. When we look back on our track record in investment and strategic alliance, we can cite an example of investment by Nomura Group in May 2016, where strategic alliance was entered into with U.S. independent investment manager, American Century Investments. With ACI, the strength of 2 companies are leveraged in mutually complementary fashion to develop businesses. In Japan, publicly placed investment trust is distributed. Not only that, usage platform was integrated in Europe. And in the United States, Nomura investment strategy is distributed through ACI network. In this way, business was expanded. And recently, AUM through collaboration has grown to close to JPY 1 trillion level. This is a minority investment, but it is not a passive investment. We have been able to build steady track record through this alliance. Next, I would like to touch upon independent investment organization that was embraced within Nomura Group called team lift out. On the left side, NCRAM is shown, this is a high-yield fixed income investment boutique. After establishment in 1991, it remains independent in its investment, and over many years, has achieved outstanding performance. AUM exceeds JPY 3 trillion, and business is deployed globally. Shown on the right is Global Dynamic Bond Fund. This is a fund that is invested by an investment team that went through team lift out in 2014, from Nomura Asset U.K. location. Within the investment category, it is ranked in upper tier. With a very strong performance, AUM exceeds JPY 400 billion. As shown in earlier slide and in this slide, in Investment Management Division, we have been making investments and using team lift out and have been expanding business while maintaining independence in investment. We have the track record. Including private domain, regarding the growth strategy going forward, we will be appropriately selecting flexible forms and manage business and expand business through flexible approach. I have thus far touched upon objectives and strategies of Investment Management Division. From public to private, based on our track record and experience, with flexible capital policy and organizational management, we aim to achieve our targets. And I hope this gives you a better picture of how we aim to achieve this. Thank you.

[Interpreted] Now we will start taking questions.

[Interpreted] [Operator Instructions]

Now operator made the announcement, but if you want to make a question through the telephone, please click on 01. And when your turn comes, then operator will ask you to ask a question. Now from the site that you are accessing, you can send a chat message. If you send a chat message, I will read your question. Thank you.

[Interpreted] The first question comes from Daiwa Securities, Mr. Watanabe.

[Interpreted] Can you hear me? This is Watanabe.

[Interpreted] Yes, we can hear you.

[Interpreted] This is Watanabe from Daiwa Securities. I have 2 questions. First question is regarding Page 14 of Mr. Okuda's material, the direction of cost. Now cost income ratio is 75% or so. So as assumption, to a certain extent, the revenue of certain extent, what is that level of revenue you're assuming? And also in Retail Division, JPY 10 billion or so of cost is expected for the advertising as well as IT costs. But in terms of the absolute amount of cost, is it going to go up or down? So that's my first question. The second question is regarding the policy on the holding of group stocks. From the viewpoint of finance, what is your view, especially Nomura Real Estate Holdings stock? In terms of business, due to business relation, certain level of stake may be needed to be held, but 1/3 of our stake, is it necessary for you to hold 1/3 of the stake? Looking back on the past quarters, the Nomura Real Estate stock price may be fluctuating and that could impact the gain from investments. So what is your policy towards the holding of the affiliate companies, especially Nomura Real Estate?

[Interpreted] This is Okuda. Thank you very much for your question. So in the presentation, I didn't mention so -- this person didn't present. But Mr. Kitamura is here though he didn't present earlier. So in -- regarding cost, and second question, Mr. Kitamura will address your questions.

[Interpreted] This is Kitamura. Thank you very much for your questions. So Page 14 of Mr. Okuda's material. So cost income ratio of 75% or so is set here. So this number as you see in the presentation material, as business, top line will be grown. In that process, as a denominator, we will expect some impact there. So at this point in time, for March 2021, from the top line as of end of 2021, so in 3 areas of business, we look to grow our revenue. On the other hand, cost control has been implemented tightly, but there is still work to be done, such as IT expense. So real -- sorry, let me say, real estate costs, rather. So in various costs, we would like to further reduce costs to achieve 75%. So while growing revenue, we would like to control costs. By doing so, we would like to achieve 75% in ratio. And regarding your second question, the Retail Division's cost, so I wonder if it's more suitable for Mr. Arai to answer.

[Interpreted] Okay. This is Arai speaking. Let me address that question. For March 2021, Retail Division's expense, it had the impact of COVID-19 and the cost came down drastically. So without COVID impact, then excluding that one-off impact, then as mentioned, person, human digital will be -- a merger will be pursued to create new business and expense will be incurred in that area. So that expense will be absorbed by the cost reduction achieved so far. And I will skip the details, but about JPY 10 billion of investment, which I mentioned, out of JPY 10 billion in investment, IT investment is included. So investment will be made, but expense will be depreciation. So in light of that, as mentioned for the entirety of Retail Division, excluding COVID-19 impact, the expense will be separate, so that expense will not go up.

[Interpreted] Kitamura speaking. Also, another thing you touched upon is our position or our stance toward Nomura Real Estate Holdings. So today's presentation may give you some indication. But for services that we provide, nonfinancial products, meaning the -- our intention is to approach the entirety of customers' assets. So that's the direction we are headed now. So in that sense, the Retail Division is working on advising on the entirety of the balance sheet of the customers. So real estate for individual investors. Real estate and -- oftentimes, it's the biggest and the most important asset on the balance sheet of our customers. And as Mr. Arai said, our sales partners are winning and obtaining the real estate transactional license. And also as presented, the volume of real estate transaction is on the rise every year, so as Nomura. Normal Real Estate Holdings is positioned as an important partner as we expand our public area business. So in order to strengthen further collaboration, we are continuing with discussion with Nomura Real Estate. So in that sense, Nomura Real Estate Holdings is a strategically important partner for us. So we do not have the intention of selling off -- or selling down our position right now. Thank you. That concludes my answer. Thank you.

[Interpreted] I have follow-up questions. So -- this is Watanabe. Regarding the cost, the numerator, the cost in terms of absolute amount, will it be going up or down? I do understand the positive and negative factors. But what is the outlook for the cost as absolute amount? And second point, stake in Real Estate, Nomura Real Estate, it may be significant to hold it. But what about the scale? Do you believe the current size of stake held to be appropriate?

[Interpreted] Thank you for the follow-up question. This is Kitamura. Overall, the cost overall will not grow that much. So as was said in Retail Division, there will be necessary investments centering on digital investment. At the same time, cost control will be applied continuously. So there will be cost increases and also cost decreases. But all in all, we do not anticipate major change in cost. And also the second point, the -- our stake in Nomura Real Estate. Unfortunately, this time, due to accounting treatment, impairment loss was booked. But our stake that we held, of course, financial resources are allocated to that, but the profitability that we see is not that bad. And overall, impact on financial resource in that sense is not that massive. So regarding the current level of stake held, we do not have the intention to make changes to that. Thank you.

[Interpreted] Next, we have from JPMorgan, Otsuka-san.

[Interpreted] This is Otsuka from JPMorgan. I'd like to pose first question and take your answer before moving on to the second question. First question for the specific customer in the United States. Regarding the loss from transaction with the U.S. client, I have a question. Today, Mr. Okuda, CEO, presented -- and as shown on Slide 1 -- and I would like to clarify or confirm. So the conclusion is that risk management will be strengthened going forward? And for example, prime brokerage business information was disclosed today. There's not much change in prime brokerage business, and it seems that overall strategy remains more or less unchanged. Is that a correct understanding? Other global financial institutions, for example, Credit Suisse, based on media reports, management is taking responsibilities, divisions are being scaled down. And prime brokerage directly relevant division, Mr. Steve Ashley, did not specifically touch upon this U.S. client. So I would like to hear more. So I would like to hear from Mr. Okuda, CEO.

[Interpreted] Thank you for your question. Regarding the transaction with the U.S. client, we are significantly strengthening risk management. And as I touched upon earlier, we have outside experts to review the sophistication of risk management. And regarding the second line of defense risk management, we have been increasing our human resources already in the past, and we will continue to strengthen this area. So in that sense, we have strengthened strategy, changed the strategy. And recently, we are also reviewing positions. And reviewing the nature of transaction with the clients that -- these are already underway, and we believe we have implemented necessary measures. Regarding prime brokerage business, as shown at the right bottom, there are a few comments. As far as business is concerned, we will continue the business. But at the same time, we will review the business -- nature of the business. And if necessary, I wonder if Steve is able to make additional comment on this point. Steve?

Yes. Thank you, Okuda-san. And thank you, Otsuka-san, for your question. Prime brokerage is a necessary business in our equity offering to provide high-quality services for our clients. We work with a wide range of clients, more focused on the business, ensuring appropriate risk management, taking into account the risk of each client. Of course, continuously, we are reviewing our geographic footprint and scope of business. But I would remind you, we are not competing in prime brokerage itself, but more as support for other equity business with particular reference to our derivative and cash businesses in Japan and of Asia ex Japan. I hope -- that concludes the answer to my (sic) [ your ] question.

[Interpreted] The second question, this is Otsuka speaking, on Page 10 of Mr. Okuda's presentation, that is the page I'm looking at. And I would like to ask you to offer additional comments on the numbers. In comparison to the levels disclosed last year, the targets for the year ending March 2023, there is an increase of JPY 40 billion for 3 segments put together. Investment Management, JPY 10 billion; Wholesale, JPY 3 billion, these are the increases in these segments. Could you describe the background leading to the increase? I think there are market factors and market shares. So that is my second question.

[Interpreted] Thank you for your question. This is Kitamura speaking. First, in -- not in asset management, but in this newly stablished Investment Management Division, initially, the target of AUM was JPY 65 trillion, that was the original target, but already JPY 64.7 trillion of AUM is reached. And so the target for the year ending March 2023, is almost achieved. In recent weeks and months, we have been enlarging this business area. And regarding Investment Management Division, therefore, we have raised the target. Turning to Wholesale. In the third quarter -- up to the third quarter, our Wholesale performance was quite strong, I believe. And of course, normalization market factors were a tailwind, and we expect normalization going forward. But in terms of basic revenue-generating capability, in comparison to last year, when we had Investor Day last year, I believe that we have stronger capability to generate revenue as a basic capability. And therefore, in comparison to target that were shown last year for the year ending March 2023, for pretax income was raised this time.

[Interpreted] Further question, this is Otsuka speaking, a question for clarification. The assumptions such as market environment, economic conditions, financial conditions, are these based on last year's assumptions?

[Interpreted] Kitamura speaking. For the past year, last year, in various businesses of ours, market share changes in the performance over the past few years were reviewed to revise the target design.

[Interpreted] The next question comes from Mr. Muraki of SMBC Nikko.

[Interpreted] This is Muraki from SMBC. I have 2 questions. First question is about the view of holding companies toward the U.S. business. So based upon your explanation, competitiveness, growth and revenue-making power are the important factors as you focus on businesses. And JPY 40 billion or so of profit was being achieved so far. In the area of private, which you will be expanding and strengthening, in March quarter last year, there was a loss from leveraged loan. And this year's March quarter, there was a loss from the transaction with this private client. So once every 2 years or so, this kind of loss or expense is incurred. So since 2004, cumulative loss of JPY 400 billion has been booked in total. So are there a bright side? But at the same time, there are risks. So there are 2 signals, I believe. So at the holding company level, to what extent in terms of the capital and resources, what kind of portfolio are you aiming to have, including the U.S.A? So Mr. Okuda has a wealth of experience in the U.S.A. and I believe you have external directors who are quite familiar with financial services in the U.S.A. So what kind of discussion is going on within the firm at the holding level? So that's my first question. And if possible, I'd like to hear your answer. Then after that, I'd like to ask a question about the Retail Division.

[Interpreted] Thank you. This is Okuda speaking. So regarding our view toward U.S. business as a holding company. And also, there are bright spots as well as risks and how are we making judgments on those 2 aspects. So I believe that's your question. So now, in a prudent manner, we have expanded business. So excluding loss in the U.S.A. -- not just in the U.S.A. alone, but for Wholesale as a whole, we have narrowed down on businesses where we can leverage our competitiveness. And just because FPO is big, we are not competing in such markets. But the important thing is the outlook that we could obtain certain size of share. So we have narrowed down on such products and as we build our business in Wholesale business. In this context, how do we view our U.S. business? So in your question, you mentioned some numbers. There -- I believe there are some misunderstanding. But regarding leverage loan, there was loss. That came from Europe, actually. But aside from those details, now in Japan, at retail branches, over the last year, investors' interest has grown regarding the U.S.A. So without being able to support Japanese investors in their investment into the U.S.A., if we cannot support them, then given the volume of investor -- in retail investors' investment and M&A volume and 2/3 of fund is being spent in the U.S.A. So without solid platform in the U.S.A., we won't be able to support our core clients, which are Japanese clients and Asian clients, and we won't be able to sufficiently support the needs of those core clients. Then in this situation, to what extent do we do business on our own? And what do we not do? And that kind of discussion has taken place the last several years. And we have carefully selected businesses we will focus on, and we came to the business lines we have. And in the area of research, for example, that's one case -- one example. But currently, in research, we have scaled down our research function. And in response to that, we have tied up with Wolfe Research, which is the seventh player in -- a research firm in the U.S.A. And their reports are being distributed to investors in Japan. And also, we have invested in a company called Greentech. And in the area of sustainability and green financing and ESG, they are focusing on the advisory services in those areas, and we've tied up with them. So in this manner, in a stable manner, we are looking to create a platform in a sustainable manner. So in this context, the loss was booked, and that was an unfortunate event. So regarding this, we would like to conduct a thorough review and review the risk management and strengthen the organization. But the importance of U.S. market from the viewpoints of clients remain important for us. So regarding the U.S.A., while controlling risks, we will steadily tackle opportunities in the U.S.A. I hope I answered your question.

[Interpreted] So my second question is regarding Retail Division. So Mr. Arai, your presentation, Page 5. So I listened to this for the first time, so I want to ask a question. But regarding KPI, so number of buying customers and also the acquisition of funds, so in terms of wrap, so the number seems to be below the wrap target. But Mizuho Securities is doing well, but it could be -- this could be the issue of the industry as a whole, Mizuho as the exception. But what is the bottleneck that you are considering? And also, you talked about new initiatives, CIO model and level fee and sales support system called [ Nomura Navi ]. So Morgan Stanley's Retail Division in the U.S.A. is working on similar initiatives but, of course, needs are different in Japan. But to Japanese clients, to what extent do you believe these services will be accepted positively by Japanese clients who have different needs than U.S. clients? And what is your outlook?

[Interpreted] Then, okay, Mr. Arai will explain.

[Interpreted] Thank you. This is Arai. Thank you very much, Mr. Muraki, for your question. So first, regarding the number of buying customers set as KPI. In our business, not just on advocating and advocating business transformation in a more substantial sense, we would like to check whether we are delivering businesses to customers. So from a different perspective than before, we are looking at our business. If you look at the graph, what you can tell is that at the end of last year, up until the end of last year, meaning the end of third quarter, the performance was robust. But after that, in the March quarter, we saw some stagnation. So you -- but there is a seasonality. But in the previous year, in the March quarter, there was COVID-19, bringing shock. So the number of buying clients spiked. So compared with previous year, in the fourth quarter, the growth rate looks soft. But -- I will not talk about the details, but as mentioned, we have coverage of customers by our sales partners. And looking at behaviors of customers, I can say with confidence that the customers' transactions, including buying, is on the rise. So partner's mindset has been changed. And also the content of the numbers that we are seeing gives us confidence that we are making positive progress. Also, regarding your second question, so various measures, including level fee and CIO model and also new tool have been explained. And you said, we refer to U.S. firm and whether those tools will be accepted by clients in Japan. So that was your question, I believe. At this point in time, I do not have certainty whether it will be positively accepted. But as mentioned, as we face our clients, we want to provide thorough services. So rather than providing low fee level, but rather, what we want to do is to provide added-value services to customers, so that we can survive in the marketplace. So what's necessary for that are the measures that we have formulated over the last 2 years. So the mindset of partners, sales partners, has been revised and reformed. Of course, I cannot quantify the change in the mindset of sales partners. But as mentioned, over the last 2 years, we could build the foundation for business. And based upon that, we would like to start generating the tangible results in our performance. I hope I answered your question.

[Interpreted] So this is a follow-up question. But regarding the first point, the number of clients and also the acquisition of funds from investors. So the numbers have not been revised in this plan. So there is still a gap to be filled to achieve the targets. So what kind of measures will be implemented in the new fiscal year to fill the gap?

[Interpreted] Thank you. This is Arai speaking. As mentioned earlier, we have the tools we will be deploying and also CIO model, which was mentioned and also level fee. Well, let me step back. In other words, customers with balance in their accounts, we have more than 5 million such accounts. But annually, the number of buying clients is about 1 million. That means our services did not penetrate the customer base of ours. So that is where we could have done better. So as a result, what it means is that our services we're reaching only a certain part of our customer base. So of course, our customers are getting older. But not just that factor, even to the younger customers, we have not been able to deliver services to access all customers, that's our suspicion. So it's difficult to explain, but there are various factors. And by taking into consideration those various factors, we have put together the measures. And hopefully, we'll be able to accumulate, build on the numbers. And though it's not listed here, for discretionary investment services, what we have accumulated in the past, over the last 2 to 3 years, suffered net loss or net in outflow, but there are multifaceted measures being taken. So from the fourth quarter or so, the degree of net outflow has come down. So we have to monitor the effect of our measures. But I do feel that there is a progress that we observe. So I hope that answers your question, Mr. Muraki.

[Interpreted] This is Muraki. So KPIs are on -- the numerical KPIS, I hope there will be progress on those fronts.

[Interpreted] Next question Mitsubishi Morgan Stanley Securities, Ms. Tsujino, please.

[Interpreted] This is Tsujino speaking. First, with regards to risk management. About risk management, there was a mention during the presentations, and there is no longer profit positions. And as I review various information, it seems that this time, with a few securities and with each security, it seems that from multiple investment banks, prime brokerage banks, there were a funding offered, and that amounted to close to 20% of the outstanding stocks. And I believe in case of Nomura, that was related to specific clients. And in other investment banks, what are the situations? Naturally, that is the question. And then it will have -- it should have led to the understanding of this terrifying situation. Was there any notion of this? And how did you check by defining similar positions? How did you define similar positions by checking? Were you able to address all of the potential issues? And leveraging at the client level when it was felt that there was no problem. There was no problem, then leverage for each customer, if it was made more stringent, then business may shrink. SEC has started to investigate, and it may lead to uncovering of these types of information. So in this respect, what have you reviewed? And what have you found? And in the end, what will be the outcome? And in this large framework of leverage, regarding the leverage appetite, leverage acceptance, what will be the outcome? Could you explain this? Could you elaborate on this? Second question, this is not related to large frame of strategy that you have discussed but regarding dividend. Because of the loss from specific customer in the U.S. of JPY 60 billion or thereabout, in the first quarter, performance will be terrible. However, dividend for the second half, various considerations were taken into account. So what are things that we can expect to see with respect to dividend?

[Interpreted] Thank you for your question. This is Kitamura speaking. Thank you for your questions, Ms. Tsujino. First about risk management. Regarding specific clients, to what extent we can discuss in-depth? There are certain things that we are not able to discuss, but regarding the 13F, my understanding is that numbers are disclosed at the end of each quarter, as I recall. And as I discussed at the time of the earnings announcement, position rapidly increased after January. So by simply looking at 13F, whether we were able to understand the total picture, I believe it was difficult to see the total picture. Was there no problem in our risk management? Certainly, there is room for further strengthening. And as Mr. Okuda mentioned in the opening presentation, several measures are already implemented. Regarding prime brokerage customers, for all of the customers, we have undergone reviews. At the time of the earnings announcement, I've mentioned that this was a transaction that was quite idiosyncratic in nature, and that is as a result of our review of clients, exceptionally large in this case. So in this way, we have conducted a thorough review. And outside of prime brokerage as well, regarding various financing, we, of course, hold risks in various other refinancing. But after this transaction with the specific U.S. client, once again, risk management, finance business together are conducting reviews. So in that sense, there were no similar transactions found. And so I've mentioned that this is a transaction that is quite idiosyncratic in nature, but that doesn't mean that we can remain complacent. Internally, review has been completed. But as we have been saying, we are also receiving support from outside experts to consider in what way we can further strengthen risk management.

[Interpreted] This is Okuda speaking, I would like to add. To add to that from various different angles, from various different departments, we are, once again, reviewing what happened. And not just from the first line of defense, but from other perspectives, we are reviewing. And in terms of governance, once again, and this is related to earlier question from Muraki but we are reviewing the governance in the United States. For example, outside director, with the wealth of experience in the United States, we will have 2 additional outside directors with such experience and CIO -- new CIO was hired in the United States. CEO -- correction, new CEO in the U.S.A. was hired. And that's -- so we are taking measures to enhance our capabilities and strengthen capabilities. So whatever weaknesses there may have been, we are taking measures to strengthen them.

[Interpreted] This is Kitamura speaking. Regarding the second question about the dividend of the first half of the fiscal year that just started. As for dividend, dividend payout ratio of 30% is the target. And that basic policy remains unchanged. Semi-annual performance will be reviewed, and we will also have to strengthen our basic ability to generate revenue. And I think there are also expectations from investors about stable dividend. We are taking into account all of these factors in a comprehensive fashion to determine the amount of dividend. In that regard, we decided on JPY 15 second half dividend for the last fiscal year, where a determination was made in a similar fashion, taking into account the various factors. So regarding the first half of this fiscal year, we will be looking at our revenue and the sustainability of the dividend and expectations from the investors and we'll determine the amount of dividend in a comprehensive fashion.

[Interpreted] This is Tsujino. The acceptable level of leverage -- with a review of the acceptable level of leverage, is there any impact? Or will there be no impact?

[Interpreted] This is Kitamura speaking. When you say "leverage," is that about specific transactions? Or leverage for company as a whole?

[Interpreted] This is Tsujino speaking. This is in relation to risk management that was explained earlier. So for hedge fund or for each client, I believe that you determine acceptable level of leverage for each client. And the way that a leverage acceptable level will be determined, will be more conservative and will that affect overall business? So that is my question.

[Interpreted] Thank you, Ms. Tsujino, for that question. This is Kitamura speaking. On the first slide by Mr. Okuda, as shown on the right side, there is a margin table review underway. We have already started to review the margin ratio, and we will continue to strengthen the risk management. And therefore, as a result, for each client -- and because of various different risks for each client, we will be thoroughly looking at these various risks and continue to do our business.

[Interpreted] The next question comes from Mr. Ban of Jefferies.

[Interpreted] This is Ban speaking. So I have 2 questions. First, regarding Wholesale section. Page 4, how to look at Page 4? So earlier, there was explanation that 16% compression of FPO is expected for this fiscal year. And JPY 130 billion of run rate based upon normalization, so that number was shown. But this year will be the process of normalization. So I'm not talking about the guidance. But from the viewpoint of the management, at Wholesale Division, JPY 130 billion, so that number was shown. In the process of normalization, is that the view of management? And also the JPY 30 billion toward March 2023, the risk management -- as risk management diversification will be conducted, so exposure per company will be reduced. But the customer base will have to be broadened at the same time. So when you think about the resource allocation, then JPY 30 billion [ will be a key ]. So cost may go up. But on a net basis, it could be JPY 30 billion. So is there a breakdown? And actually, I have a third question. Regarding the crypto asset, JPY 100 million. So domestic financial institutions are already making a profit to a certain extent at the crypto asset. So in the medium term, $100 million, that number, as crypto asset business, are you being conservative? Or to the market, are you being conservative when you put out the market communication? Or is your stance itself conservative when it comes to crypto asset? And also regarding IM Division -- sorry, regarding the profit on investment in the medium term, ACI-related loss or gain. If it's not included, then in Wholesale and Retail, in expanding private business, is -- are you assuming the gain from investment made by IM Division? And in the medium-term as Nomura Group, the size of investment portfolio to be grown bigger, is it the underlying assumption? Sorry, I was being wordy.

[Interpreted] Thank you very much. So regarding the normalization of Wholesale, JPY 130 billion, the meaning of that and also the crypto asset, our stance toward crypto asset, Mr. Steve Ashley will explain.

Thank you very much, Mr. Ban, for your questions. Regarding normalization, as you can see from the chart, our PTI performance the last year with very high record levels of revenue was driven very much by the monetization of volatility in client flow throughout the year, especially in secondary trading. Rates, in particular, has been outperforming both in the last 2 years, owing to very high levels of volatility in the markets. And significantly increased client flows very much essentially related to the unprecedented disruptions from COVID-19 and related central bank policy behavior. I think in terms of this year, we expect volatility to be back to lower levels, clearly, with the pace of vaccinations increasing in a number of countries and the expected reopening of the economies. What I would say, though, is that despite a significant normalization in secondary trading, the PTI still remains very much above prepandemic levels across the majority of our products. And that's why we've updated our KPIs for '22, '23, in view of this higher run rate. I would also say that while there may be some growth in resources regarding our involvement in private markets, we do not expect material increase in risk-taking beyond what's required to service client flows and market opportunities. So very much that PTI growth is expected from the high return on equity or fee-generating and accrual-based income businesses, which I outlined in my presentation, notably wealth management, private market, advisory, and then as you mentioned, digital assets. And I think regarding digital assets, are we being conservative? Well, as we can see, the digital asset market is growing very rapidly, and it's been coming increasingly part -- or in terms of reshaping traditional financial market infrastructure. And certainly, we would expect it's setting the stage for a much deeper transformation of the financial industry in the form of asset tokenization, the issuance of central bank digital currencies as well as even direct access to financial services through a variety of decentralized finance platforms. But I think we want to proceed cautiously. We want to understand and explore different elements of the value chain. And so yes, I would agree with you, we are being largely conservative. We will proceed cautiously and monitor the development of the market. As you noted on Page 8 of my presentation, we've already executed Komainu, our digital asset institutional custody platform as a first step. And I am very encouraged, I think, about other opportunities as they emerge over the course of the next 2 years. So yes, you could be right, $100 million could well be a conservative assessment of the potential revenue that we could exploit from this asset class. I hope that answers your question. Thank you.

[Interpreted] So regarding IM Division, Mr. Namura will answer.

[Interpreted] Thank you. This is Namura. So if you could go to Page 5 of my presentation. Firstly, as the graph shows, the previous asset management division last year, it shows the performance of last year, the gain or loss of investment, JPY 36.1 billion. That's last year's ACI-related gain or loss of investment. And in addition to ACI number, the former MB divisions are investment loss or gain as shown in the second from the left, JPY 50.3 billion. And that includes investment by former MB division and also ACI's number is included in this number. And last year, as I explained, market was quite favorable for us. So the unrealized gain was at high level. So what's -- after normalization, we have next year's target close to JPY 15 billion. So even if we conduct the investment now, next year, we -- it will be too early for us to gain the result of the investment. But in the future, including the expansion of the investment towards March 2025, we would like to aim to JPY 25 billion as a -- at a cruising pace. So we would like to make investments so that we can get to that goal. And the breakdown of that, of course, there are 3 types of investment. So the first type is new private area investment using establishment of general partner. So it also make investment into limited partnership. So [ LP ] investment will be a big driver. And secondly, ACI is the case in point, but our partner asset managers -- if we are to invest into the partner asset managers, that's considered as a gain or a loss of investment. So there will be numbers related to the investment into partner asset managers. And the third type is our own investment using our own fund. So the gain on investment for us and the benefit for the investee could match. For example, Nomura Capital Partners was -- has been working on that. And it takes up a certain size of capital, so we will be selective in deciding on where to invest. So through these initiatives, investment portfolio will grow bigger, but we will be making a revision to what we already have. Thank you.

[Interpreted] So then what I should envision is that for March 2025, so you will reach the stage of harvesting? So in that sense, the 3 types of investments you mentioned already, where, in the near future, investment will be made, is that the right understanding?

[Interpreted] Namura speaking. Yes, your understanding is correct. Thank you.

[Interpreted] It is now approaching the time to end, so next question will be the last question. We have Mr. Niwa from Citigroup Securities.

[Interpreted] This is Niwa speaking. Can you hear me? About capital and the growth strategy and about investment management, I have a question for each. First, Mr. Okuda -- a question for Mr. Okuda. On Page 15 of your presentation material, growth and allocation, distribution, the balance between the 2 is my question. In terms of balance, as shown on this page, exceeding capital cost, a large-scale investment, is there anything in the pipeline that is visible? What is the current appetite for such large-scale investment? And the total payout ratio of about 50% was -- the total shareholder return ratio of above 50% was mentioned. And what conditions will have to be satisfied to reach 100%? You will be targeting income of JPY 320 billion. So the pathway beyond that is my question. This may be only me, but I think that the focus is more on being prudent and sustainable. So the future growth is my question -- appetite for future growth. The second question is about investment management. What are the positives and negatives of being 100% entity within the Nomura Group? Investment management, in name and in substance, I think has capability to operate fully independently. That is my impression. But target AUM is JPY 70 trillion in the final fiscal year. Globally, this necessarily is not very large. So to be within Nomura Group and to go outside of the Nomura Group, what are the benefits and the merits? I would like to seek comments from both Okuda-san and Namura-san.

[Interpreted] Thank you for your question. This is Okuda speaking. Regarding the first question, exceeding capital costs, whether we identify any investment opportunities that exceed capital cost and what will be the conditions that will be satisfied to reach total shareholder return of 100%? So right now, it is not the case that we see potentially opportunity for large-scale investment. And now regarding how we look at the future growth, since last year, I have repeatedly said that when we look at the way of doing business in Nomura in the past, we felt that it was necessary to change, and we did change the way of doing business, and we are also changing the substance of the business. For example, as Mr. Arai discussed, the Retail business, we are taking the same perspective as the investors in our work. And so fee schedules will be diversified. Such efforts are made. And the way of doing business is changed. And we are applying more customer-oriented perspective so that we can move to the next stage. And I believe that in this way, we would like to solidly capture growth opportunities. In the number of press releases that we have issued over the years, please look at these press releases. We have issued a very large number of press releases in the past year, which means that we have started various new businesses, including content company. And as we announced on the 10th of May, we are entering into alliance with regional banks and with San-in Godo Bank and Awa Bank, we already launched alliance. We are also entering into alliance in New Zealand and Australia. And in the United States, ESG advisory firm granted capital, acquisition was implemented. So we are taking various measures in different areas to achieve growth. So we do have appetite for growth. But as I have explained, we did experience this transaction with a U.S.-specific client in the United States. So compliance, risk management, the way of doing business by the front offices, we will continue to review as we also strive to move to the next level, next stage. So that will be my way of answering your question. And as for the second question, on Investment Management Division, to begin with, we came to think that we need to establish this division because we felt the need to grow business in this area. In the last year, amongst the top management, we had much discussion, and we were able to start Investment Management Division this fiscal year. Whether we can go across the organization beyond Nomura Securities retail, what we are currently thinking about these asset management business done by Nomura Group -- for Nomura Group is carried out by Nomura Asset Management, but not limited to Nomura Asset Management. Majority of customer needs may be addressed not only by investment trust, but by private products or alternative assets and as mentioned earlier, real estate products. And in order for us to grow IM business, and although, Nomura has a strong team in financial services, but when it comes to investment, the largest Nomura Asset Management in public market business investment trust -- investment, we have that strong business. And on the other side of the spectrum, we have Merchant Banking business. And in between these 2 ends of the spectrum, to be honest, I have to admit that we do not have very strong capabilities. We had a tie-up with JAFCO venture capital, but we sold off our stake. And so we are now partnering with SPARX, which joint venture we discussed earlier in the presentation. By including these areas, I think that as far as businesses are concerned, we will be able to have a very interesting platform that cater to the needs of the customers. And that is what I'm asking Mr. Namura to look into. And middle market included in the platform, we have a strong platform in Nomura Asset Management. So we would like to share that capability across the group. And people in the Nomura Asset Management, and there are several companies, entities, names that I've mentioned, there are various managers. And we also have content. And these were -- belong to each separate entity, but now we are more group-wide in our focus. We have recognized what asset we have group-wide. And I believe in Investment Management, we also have to capture inorganic growth opportunities. Our platform can be utilized by investment managers that we may acquire so that is -- that will also be an area to strengthen. So those are the way we are starting our efforts with -- and regarding AUM, I would like to ask Mr. Namura to respond.

[Interpreted] This is Namura speaking. Mr. Okuda already covered this, but same from the Investment Management Division, I think there is a major benefit of being within a major financial institution, which is greater access to customers, investors. Nomura Securities is a sales company for retail, and this is a customer-oriented business conduct. And to maintain quality, we have arm's length relationship with Nomura Securities. For Wholesale, inside and outside of Japan, we are increasingly referring institutional investment customers, and we see increasing opportunities for collaboration. Regarding investment, especially in private domain investment, investment manager and the parent financial institution, the relationship or independence, some customers show concerns, but some customers appreciate investment manager being part of financial institution that offers investment opportunities. So I believe [ benefits outweigh the merits ]. We would like to continue to seek understanding from customers the benefit of being within a major financial institution.

[Interpreted] So with this, we are closing the Q&A session. If you have additional questions, please send those to the IR office. At the end, from Nomura Holdings, we will deliver some words of greetings.

[Interpreted] This is Okuda. Thank you, everyone, for attending our Investor Day event today despite your tight schedule. Last year, I became CEO, and I have been saying that we will elevate Nomura to the next height. And I have worked with other management members, and we have engaged in discussions intensively, including discussions on strategy on the weekend. So strategies will be continuously discussed among management members. And with the incident in the U.S.A., we caused lots of concern for you, and we take what happened gravely. And we will take various measures from the viewpoint of risk management so that we can move on to the next stage. As I said last year at this event to investors and analysts and stakeholders, we will conduct close communication. So we -- so if you have additional questions or opinions, please do not hesitate to get in touch with us. And I appreciate your continued support. Thank you once again for your participation. With this, we are closing the Investor Day event. Thank you for attending the event. [Portions of this transcript that are marked [Interpreted] were spoken by an interpreter present on the live call.]