Nomura Holdings, Inc. ($8604)

This is Kentaro Okuda, Group CEO. Thank you very much for taking time out of your busy schedules to join our Investor Day today. Let me begin with the most important point. We are significantly raising our numerical targets for 2030, ROE to 10% to 12% or more and income before income taxes to over JPY 750 billion by 2030. Following my presentation, the heads of our 4 divisions will each present their strategies. So in my part, I would like to explain the progress we have made in transforming our business model, the upward revision of our numerical targets for 2030 and our growth strategy and organizational foundation aimed at achieving those targets. First, I'd like to review the progress we have made so far in transforming our business model. In the previous fiscal year, net revenue totaled JPY 2,167.7 billion. Income before income taxes was JPY 539.8 billion, and net income was JPY 362.1 billion. This represented both higher revenues and higher profits. Net income reached a record high for the second consecutive year. Income before income taxes and ROE are progressing faster than the targets we initially set when formulating our management vision for 2030. Each KPI is also progressing at a pace above the initial assumptions made when we developed that vision. In Wealth Management, the asset management-based business model has continued to expand. In Investment Management, our global asset management platform has been strengthened. In Wholesale, our profit-generating capacity and earnings stability have improved significantly. And in banking, although it's still in the early stages, it is steadily emerging as the next pillar of our growth. While we have benefited from certain favorable market conditions, our performance has not been dependent on them. Rather, it's the result of our transformation translating into tangible outcomes. The stability of our earnings and our ability to generate profits has improved dramatically. In the current fiscal year as well, during April and May, Wealth Management and Wholesale have been trending above the levels of the previous quarter. Nomura is a company that steadily executes its strategy enhances the value it provides to clients and turns those efforts into results. At the outset, there were voices asking whether we could really deliver. But by not fearing change and by transforming ourselves, we have, in fact, raised our earnings power. The business model transformation we are seeing today and the results it is producing demonstrate exactly that. That said, we are by no means satisfied. The moment we become satisfied growth stops. That's why we must always aim higher and continuous driving. I'm convinced that Nomura has the ability to achieve the goals that it sets. As I mentioned, we are raising our targets to ROE of 10% to 12% or more and income before income taxes of over JPY 750 billion by 2030. The JPY 750 billion figure is 1.5x our previous target and approximately 3x our actual results for the fiscal year ended March 2024, before we announced the 2030 management vision. We held extensive discussions internally before arriving at this decision. In order to clearly communicate to investors at this point, in time, our growth potential and our commitment to achieving it, we have set these targets with strong determination. The new ROE target range of 10% to 12% or more reflects our intention to firmly establish ROE above 10%, even in challenging environments and aim even higher when conditions are favorable. We recognize that improving capital efficiency and delivering profit growth while aiming for 12% or more will not be easy. However, we will seek to achieve these targets by expanding revenues in each division, increasing synergies across divisions and continuing group-wide structural reforms, including in Corporate. At the same time, we will continue reviewing our business portfolio and replacing assets with a focus on profitability and capital efficiency. On that basis, we will further strengthen cost discipline and enhance our profit-generating capacity. To balance growth investments and shareholder returns, we will maintain disciplined resource allocation and further strengthen our governance and risk management. Among the KGIs and KPIs shown on the slide for each division, I'd like to highlight Three points in particular. First, in Wealth Management. We are aiming for a recurring revenue cost coverage ratio of over 100%. Through this, we will further enhance the client-focused services we have built over time and expand the positive cycle of growth. Second, in Investment Management. We are targeting assets under management of approximately JPY 180 trillion. This would allow us to join the $1 trillion club, a benchmark for globally competitive asset managers and it will further strengthen our revenue base. Third, in Wholesale, we are aiming for revenue to modify RWA ratio of 7% or more, a cost-to-income ratio below 80% and divisional pre-tax ROE of 10% or more. Banking was only established last year, so we have not made major revisions to its KPIs. However, it is steadily taking shape as a platform connected to Wealth Management. Through initiatives such as Deposit Sweep Services, it is developing into the next pillar of growth by expanding the value we provide to clients. It should be noted that the targets we are revising upward today do not incorporate any major inorganic growth. We believe these targets are achievable through the growth of our existing divisions and existing businesses alone. On top of that, we will also pursue nonlinear growth by making use of accumulated capital. We believe that steadily building organic growth while maintaining discipline around capital efficiency and financial soundness and delivering growth beyond expectations is what will earn the trust of our stakeholders. To achieve this, we are moving forward with several important initiatives and changes to our management structure. Since becoming CEO, I have emphasized the expansion and strengthening of private markets in addition to public and have worked to reinforce a stable revenue base centered on our Asset Management business. As a result, as of the end of the previous fiscal year, combined client assets in Wealth Management and Investment Management exceeded JPY 300 trillion, through stronger collaboration across divisions and regions as well as strategic partnerships with external partners, I believe the value of our platform has reached an unprecedented level. The client base of Wealth Management, the product capabilities of Investment Management in private markets, the global franchise of wholesale and the loan business of banking have begun to operate in concert, strengthening the revenue base of the entire group. We will embed and further enhance this collaboration as a mechanism that supports the group's revenue base. To achieve our upwardly revised numerical targets we have reviewed our management structure. Of the 4 division heads, 3 have changed. We have also changed the heads of 2 companies and appointed a new President of Nomura Asset Management from outside the group. This is a clear message that we are not simply continuing along the same path as before but are moving toward further evolution. And I have made these personnel decisions with a strong desire to create major change. This is the leadership structure we need in order to execute each division's growth strategy more quickly and with greater expertise. We have organized the initiatives for sustainably achieving ROE of 10% to 12% or more into 3 areas: revenue growth, expense optimization and capital allocation. Let me start with our revenue growth initiatives. Through last year's acquisition of a U.S. asset manager, Nomura Asset Management, which has long had an overwhelmingly strong foundation in Japan, has entered a new phase of establishing itself as a global brand. What we gained through this acquisition is a platform that integrates distribution, products and Investment Management in the fast-growing U.S. market. By further strengthening distribution in the U.S. market, and expanding new business opportunities such as active ETFs, we will quickly establish the structure needed to grow AuM. The Nomura Emerging Open Fund launched on the 21st of last month and managed by Nomura Asset Management International achieved inflows of approximately JPY 150 billion. In addition, we will expand our product lineup with collaboration through the Macquarie Group, the former parent company. We have also started selling an APAC-focused infrastructure fund structured by Macquarie in Japan, making this a concrete example of collaboration across divisions. At the same time, by leveraging the distribution channels of Nomura Asset Management International to cross-sell existing products, including those from Japan, we will connect these efforts to new medium- to long-term growth opportunities. In addition to making Nomura Asset Management, a global brand, we will further strengthen our global asset management franchise by building a one-stop platform for alternative investments, expanding in real assets such as aircraft leasing and real estate funds and continuing to enhance the deployment of talent overseas. In Wholesale, we have strengthened our client franchise, diversified our products and increased the stability of a regular base, all with the aim of steadily improving divisional ROE. Over the past 3 years, we have improved the cost-to-income ratio from to 83%. In the previous fiscal year, our revenue to modified RWA ratio exceeded 7%, demonstrating stronger earning power. As a result, in the previous fiscal year, wholesale recorded its highest profit since the division was established in April 2010. Going forward, we will further review areas with low profitability and concentrate management resources in areas with higher profitability, thereby continuing the transformation toward a business structure capable of generating sustainable earnings. Through integrated operations from front to back, the use of technology and top-down reviews of our cost structure, we will capture global growth opportunities while maintaining a strong focus on capital efficiency and cost discipline. In Wealth Management, we have seen transforming -- we have been transforming our business model through a shift to an asset management-based business model, the introduction of a segment-based approach, the strengthening of workplace business to capture emerging wealth and comprehensive business partnerships with regional financial institutions. Banking functions are directly linked to strategic key words for the group, such as affluent clients, workplace, corporates and wealth succession. In banking, on April 27, we launched a Deposit Sweep Service that automatically transfers funds between securities accounts, at Nomura Securities and deposit accounts at the Nomura Trust and Banking. We have also expanded the range of assets eligible as collateral for our loan services, strengthening our service platform to respond to a broader range of client needs to realize true Wealth Management as a group, we believe it is essential to strengthen banking functions and provide more comprehensive asset management services from the client's perspective. By enabling clients to use banking functions such as deposits, loans and trust services, we can steadily build net interest income as a stable source of revenue. At the same time, sweep deposits have different characteristics from everyday transaction accounts. We will, therefore, carefully manage ALM and liquidity while enhancing the value we provide to clients and expanding our revenue base. Nomura has been transforming itself into a company that builds services based on client needs. Going forward, we will take this a step further by offering our IT infrastructure and expertise as service functions, thereby enhancing our value as a platform. This will allow us to deliver services to customer segments we have thus far not been able to sufficiently reach, supporting the expansion of the asset management market while also contributing to growth in our client assets. We now have comprehensive business partnerships with regional financial institutions that share our vision and all of these partnerships are producing results above the initial plan. Our initiatives with regional financial institutions also help us identify areas where we can enhance the value provided to clients and are contributing to the accumulation of important expertise for advancing our platform strategy. We are also working to expand new channels for providing financial services by leveraging our strong corporate network in Investment Banking. We expect to be able to talk soon about new alliance partners that go beyond existing industry and business category boundaries. In addition to cost increase from inflation, we are facing structural upward pressure on expenses from areas such as cybersecurity, infrastructure enhancement and other investments. Even in this environment, we will implement prudent top-down cost control in order to achieve our ROE target on a stable basis. The initiatives led by the Structural Reform Committee or SRC, are not merely temporary cost-cutting measures. They are group-wide efforts to achieve efficiency gains and improve productivity through structural reforms of our organization and infrastructure while realizing disciplined cost management. Through SRC 1.0, we achieved approximately JPY 75 billion in cost structure improvements going forward through SRC 2.0 will fundamentally review the operating model of corporate functions and our IT architecture and aim to achieve additional cost efficiency gains of around USD 500 million. At the same time, we will continue reviewing our business portfolio, concentrating management resources in highly profitable areas and aiming for further improvement in the cost-to-income ratio. Our objective is not to cut expenses indiscriminately. We will make the necessary investments for the future while generating funds that can be directed towards growth. That is why we will pursue cost control together with growth investments, including inorganic opportunities. Our AI and data strategy is designed to leverage our client base and proprietary data to provide personalized services. We will use it as a foundation for improving service quality and profitability. Our use of AI should not stop at having AI support people. We need to evolve into an organization where AI is embedded in the way we work. In other words, we aim to become an organization where AI can work effectively. Over the past 2 years, we have achieved a certain degree of improvement in earnings stability. Going forward, we intend to further accelerate growth. Capital exists, not to be hoarded but to be deployed to create value. By building capital through profit generation and by rotating assets, we will secure the resources to fund growth and make investments aimed at realizing nonlinear growth. Through a disciplined capital strategy, we will balance growth investment and shareholder returns while aiming to improve ROE and maximize corporate value. In April this year, Nomura Group established the Well Growing Institute with the aim of contributing to a cycle of human endeavoring and thriving for people both inside and outside the company, starting from the comprehensive strength we possess as a financial services group. This initiative will further enhance the value we provide to society while also strengthening Nomura Group's organizational foundation. We regard people as our greatest asset with well-being, inclusion and human resources management strategy as our core pillars, we will promote the growth of each employee and enhance our organizational capabilities. We see investment in people, not as cost, but as a form of growth investment that supports future earning power by enhancing client value, strengthening our advisory capabilities and improving execution capabilities. The Nomura brand is widely recognized. However, there remains further room to deepen understanding and raise appreciation of Nomura Group's strength and the value we provide. Brand strategy is not simply about increasing awareness. It is an important management resource that supports both client acquisition and talent recruitment. By integrating our brand strategy across the group, we will strengthen our position as a company chosen by both clients and outstanding talent, which will translate into enhanced corporate value. Last fiscal year, as part of our efforts to enhance governance, we transitioned into a structure in which all members of the Nomination Committee and Compensation Committee are outside directors. Since this transition, both committees have been operating more actively and effectively. At the same time, we will continue to evaluate the effectiveness of the Board of Directors and strengthen its supervisory functions, thereby improving the quality of management. In particular, the objective perspectives and professional insights provided by outside directors are extremely important as we prepare for the next phase of change. We aspire to create a better world by harnessing the power of financial markets. That is our purpose. I believe the starting point towards the achievement of this purpose is to deliver value to clients through our core businesses. Through the markets we serve, we circulate capital and expertise to support the challenges of companies and individuals. By accumulating these efforts, we help make society more prosperous. That is the essence of our work. The moment, we become complacent growth stops. That is why we will always continue to aim towards new heights. We are raising our numerical targets for 2030 to ROE of 10% to 12% or more. And income before income taxes of over JPY 750 billion. We will raise our targets, change our structure, refine our strategy allocate capital appropriately and leverage AI and our brand to accelerate growth. We intend to continue playing a leading role in promoting Japan as a leading asset management center. Please look forward to Nomura's next stage of challenge. Thank you very much.

Next, we will have Mr. Tobari, Head of Wealth Management, present.

This is Akihito Tobari, Head of Wealth Management. I will explain the progress of our strategy towards 2030 and our outlook going forward. First, I will review the transformation we have undertaken to date. In 2012, Wealth Management began transforming its business model toward asset management-based business model. And since then, we have clarified client segments and build service delivery structures optimized for each client group. As a result, the recurring revenue cost coverage ratio has risen from 22% to 72%, and our revenue base has shifted to a more stable structure. Over the past 2 years, in particular, these results have become clearly visible. Our current income before income taxes has exceeded JPY 200 billion, the highest since the division was established in the fiscal year ended March 2002. All of our major KPIs are progressing above plan. Notably, net inflows of recurring revenue assets have reached the mid JPY 1 trillion range for 2 consecutive years, and recurring revenue assets reached JPY 27.9 trillion at the end of March 2026. These results are not due to one-off market factors, but are the outcome of steadily executing our strategy. For high net worth clients, we reorganized our structure 3 years ago and significantly increased the number of face-to-face sales partners. Since then, we have improved productivity and clarified target segments, so sales partners can sustain high performance and expanded our product and solution offerings. As a result, our Asset Management-based business has grown substantially, and we have expanded our client base through new client acquisition. Regarding our workplace business, and services that combine digital and human elements, we have built the foundation of a reproducible business model. In the Workplace business, in particular, we have established client acquisition channels, leveraging our unique strengths, highly manager ratios and shares in ESOP among listed companies. substantially increasing the number of workplace services provided and the number of accounts. The results for our high net worth clients are also clearly reflected in the numbers. In the core face-to-face businesses, Private Wealth Management and Wealth Management. Sales partners delivering high added value are driving revenue growth at a pace that exceeds spontaneous trading. Net inflows of recurring revenue assets increases have also grown on both fronts, inflows from new clients and accumulation from existing clients, and they are expanding with quality. So what growth potential remains here? Well, I believe there's still significant room. In Japan, with inflation rising, demand for asset building and asset management has clearly increased. Policy support has advanced the shift from savings to investments, and the share of securities in household financial assets is on an upward trend. Along with the accumulation of investable assets and the buoyant equity market, the overall household financial asset base continues to expand. Given this trend, we expect the high net worth individuals market to continue expanding. More importantly, this is not limited to high net worth individuals. These needs are also showing up in emerging Wealth and asset building segments, and we expect the market to expand. To capture this market growth reliably, we will provide services tailored to the needs and circumstances of each client segment and expand assets under custody. In light of our strategic progress and the changing environment, we have revised our 2030 targets. We have upwardly revised recurring revenue assets to JPY 41 trillion and the recurring revenue cost coverage ratio to over 100%. We have also introduced a new target for workplace assets under custody targeting expansion to over JPY 15 trillion in the fiscal year ending March 2031. Given the results we've achieved so far and the projected market expansion, we consider these targets fully achievable. So how will we achieve these targets. Going forward, we will focus on 3 core strategies: first, enhancing the value we deliver. By deepening collaboration with banking and offering more comprehensive solutions that integrate assets and liabilities, we will elevate our Wealth Management services. we will expand our service line up from a client needs perspective and continue to raise the level of our greatest source of added value, which is our people. Second, establishing new models to expand our client base. We will further strengthen the Workplace business, which we have steadily built up through our model and expand our platform business. Third, building infrastructure using AI and technology. Leveraging AI and technology, we will create the infrastructure that supports improved value delivery and client base expansion. By advancing these strategies, we will enhance value delivery, broaden our client base and maintain sustainable growth. Delivering numerous comprehensive Asset Management services to more clients while contributing to the realization of a more affluent society and helping to fulfill the Nomura Group's purpose. I will now explain each strategy in more detail. First, improving value delivery, focusing on the collaboration with banking. Currently, Japan is experiencing inflation and rising interest rates. In this environment, demand is increasing for integrated asset and liability solutions that include not only asset management but also deposits, borrowing and liquidity management. We have already been proposing solutions with the balance sheet in mind, but deeper collaboration with banking will enable more comprehensive asset management that includes deposits and loans. As a result, we will be able to offer a wider variety of higher-value products and services tailored to client attributes and needs. Looking at U.S. precedents, advanced services that combine Wealth Management and banking functions raise client satisfaction, which in turn increases assets entrusted to the firm and grows both interest income and fee-based revenue. We believe this represents a significant revenue opportunity for us as well. Next, expanding our service lineup from a client-centric perspective. Our strength lies in our ability to shape and deliver the necessary services for diverse needs that arise from our extensive client base by leveraging internal and external resources. When sales partner identify client needs, our well-staffed product and solution organization develops optimal services in coordination with the group and delivers them. This accumulation has led to the expansion of our Nomura-style service lineup. For example, to meet the increasingly sophisticated investment needs of ultra-high net worth and high net worth clients, we offer investment opportunities in private assets to diversified client portfolios. For clients seeking stable returns, we provide new investment opportunities such as listed corporate bond type preferred shares. We will continue to lead the market by expanding our service lineup and raising the value we deliver. Next, raising partner capability. Sales partners ultimately deliver services to clients and improving talent quality is key to enhancing value delivery. Therefore, we are building systems to continuously produce high-quality sales partners. Specifically, we hold regular dialogue sessions so the entire organization moves in the same direction embedding our vision. We are also establishing systematic talent development programs and strengthening the management layer that supports them. One example of systematic talent development is our program for the first 36 months after joining the firm. Nomura has a culture of instructors training young employees. Leveraging the knowledge accumulated through this practice, the program is structured so that employees systematically acquire numerous know-how according to common steps. We will continue to strengthen training by level to further improve the quality of talent development. For the management layer, we have clarified roles and established a consistent personnel management system. We also ensure managers have enough time to engage adequately with their subordinates. Recently, through organizational restructuring, we have created a structure that enables managers to properly focus on business development, talent development and appropriate operational management. Next, expanding new client bases. First, the sustained expansion of the emerging wealth client base through the workplace channel. As previously explained, we have been building a B2B2C business model to acquire emerging wealth clients who could become future high net worth clients. By the end of last fiscal year, we had developed the organizational setup and operational foundation to continuously acquire clients and deliver services. From here, the challenge is how to increase the assets entrusted to us by raising service levels and being helpful at various stages of our clients' lives. For working edge clients, we will expand usage by improving the UI/UX of our digital services and innovating how services are delivered, so clients begin asset building earlier. For the Retirement segment, we will develop sales partners to provide higher-value asset management services. In addition, through collaboration with banking, we will expand our product lineup tailored to workplace clients. Through these initiatives, we will grow workplace assets under custody to over JPY 15 trillion. Next, expanding the client base through platform business. As CEO Okuda explained, the platform business allows us to serve clients we could not reach on our own. This not only widens our growth opportunities but also contributes to realizing Japan's goal of becoming a leading asset management center. We are already seeing significant results in our business with regional financial institutions, and we will continue to expand these efforts. Now I will discuss the third strategy, building infrastructure through AI and technology. The core of our digital usage platform is the asset management app, NOMURA. We have developed asset management functions and partner integration features, and we have prioritized security in development, including passkey registration. As a result, active users have grown significantly and monthly active users reached 1.17 million at the end of March 2026. Going forward, we will continue to improve convenience through UI/UX enhancements and incorporate Nomura specific added value to deliver services more widely to clients with high digital needs, including high net worth clients. Regarding AI use. We will train AI on Nomura's long accumulated high net worth client data as well as Nomura's proprietary insights such as partner behavior and proposal data. This AI will support efficiency and improve reproducibility of high-quality proposals by creating and summarizing client profiles and meeting records and organizing information for the next proposal. We are also building the infrastructure that underpins the client experience. In addition to developing the data platform that supports AI use, we will introduce AI operators in contact centers at client touch points. In the future, AI trained on Nomura's insights will work in tandem with sales partners to further enhance proposal quality and the client experience for each client, delivering Nomura's unique added value. Finally, I will explain our approach to costs and investments. Since 2018, we have pursued continuous cost reductions centered on compressing the fixed cost base transforming our P&L into a structure with stronger discipline. Going forward, we will continue to control expenses within asset range by consolidating and standardizing operations digitizing and optimizing IT costs to review our cost structure. At the same time, the capacity freed by structural reforms will be firmly allocated to growth investments. Investment in AI, technology and people are particularly important themes that will determine future competitiveness. We will act nimbly to make the necessary investments. That concludes my presentation of our medium- to long-term strategy towards 2030. Building on the foundation we have established by enhancing value delivery, expanding our client base and leveraging AI and technology, we will reliably achieve our 2030 targets. Thank you for your attention today.

The next presentation will be made by Mr. Sugiyama, Head of Banking. Please go ahead.

This is Sugiyama speaking. And as of April, I have taken on the role of Head of the Banking division. Today, I will explain the environments around in the Banking division and our approach to business expansion over the mid- to long term. First, I would like to review the fiscal year ended March 2026. The Banking division was established in 2025 under the strategic policy to strengthen banking as the fourth pillar of the Nomura Group's efforts to realize our 2030 management vision. In our first year, while top line revenue steadily expanded, expenses increased as we continued strategic investments aimed towards medium- to long-term business growth, resulting in a decline in PTI. However, this was due to upfront investments to capture future growth opportunities and the earnings base itself has been steadily strengthened. We monitor revenue in 2 broad categories: banking revenue and trust and agency service revenue. Banking revenue has been accelerating, driven not only by the increase in loan balances, but also by improving spreads in a new era of the world with interest rates in Japan. We believe the Banking business will serve as an especially important driver of future business expansion. Trust and Agency service revenue has also been growing steadily, supported by the expansion of trust assets, which is one of our KPIs. Looking back at individual initiatives in our loan business, we expanded the range of asset eligibles, we expanded the range of assets eligible for collateral to better meet the needs of a broader range of clients. In addition, by revising our advertising strategy, we succeeded in stimulating client demands. As a result, spontaneous uptake of web loans by our customers accelerated and balances increased by 25% from the end of the previous fiscal year. We have thus been able to turn our clients' needs into business opportunities. In our trust business, assets grew certainly against a backdrop of favorable market conditions. In particular, capital inflows continued into private assets where we have a competitive advantage, contributing to the expansion of trust assets. In addition, capital inflows into tri-party repo, one of our trust services for financial institutions continued supporting stable business growth. We also made significant progress in strengthening our business infrastructure. By completing the renewal of our core banking system, we eliminated the previous cap of 1 million managed accounts and established a foundation that enables us to provide banking services broadly to Nomura Group clients. Through this initiative, we are also strengthening the linkage of client information with the Wealth Management division and advancing efforts to build a framework that enables us to provide more consistent services in coordination with Nomura Securities. I will explain our strategic investments in more detail later. But as far as the banking division is concerned, strengthening our infrastructure is essential to dramatically expand our business, and we view the completion of this critical first step as a meaningful achievement. Next, I would like to explain the social significance of the business we are developing in banking. In Japan, under the policy plan for promoting Japan as a leading asset management center, investment in securities is expanding. In addition, with the return of inflation and interest rates for the first time in 30 years, the characteristics of cash and deposits, which account for roughly half of Japanese household financial assets are undergoing significant change. As a result, there is a growing need to further enhance asset management for each individual in order to help them realize the future they aspire to. Against this backdrop, the Nomura Group will leverage our comprehensive strength across the group to deepen our engagement with our clients to serve all aspects of our of their balance sheet and provide more advanced comprehensive Wealth Management services by demonstrating the desirable model for comprehensive Wealth Management services, we aim to contribute to the policy plan for promoting Japan as a leading asset management center. And in turn, to the establishment of a virtuous cycle between growth and distribution, helping to realize a more prosperous society. In this context, what's important is the Nomura Group's vision of Wealth Management. What is Wealth Management. At Nomura, we believe that Wealth Management is a service that supports the management not only of financial assets, but also of the broader assets that clients value such as their families, companies and communities. It is a service that helps address the concerns client space in managing their assets. In particular, the concerns of clients with large asset bases often become more complex and highly individualized and resolving them requires deeply customized services tailored to each client's specific circumstances. Many financial institutions take a product and service supplier-centric approach in which they first prepare a broad lineup of generic services and then provide them to clients who need them. While this can be effective for offering services broadly to a large number of customers, it does not necessarily lead to service delivery that aligns with the needs of each individual client. As a result, the value of the client experience remains limited, and there are also constraints on business expansion per client. By contrast, what Nomura Group pursues is client-centric solution creating wealth management. if our existing products and services cannot fully address a client's needs or concerns, we develop new ones and strengthen the lineup itself. This mindset is a source of our competitiveness. Rather than covering a high number of clients, but through little engagement per client, our approach is to serve each client deeply, which leads to higher client experience value and maximization of LTV. In fact, in response to growing demands for more sophisticated portfolio management, we launched BREIT as Japan's first publicly offered private investment trust. Also to meet demand from clients who wish to raise funds without selling well-performing U.S. equities or investment trust, we added for an equities and investment trust to the list of eligible collateral for Web Loans. In this way, we have expanded our product service lineup. Expanding products and service lineup in response to client needs not only improve satisfaction among existing clients, but attracts new clients with similar needs, further accelerating overall business growth. To accurately meet such diverse and complex needs, sales partners who can precisely identify client needs and the capability to develop products that meet such needs are both indispensable, having both is a major strength of Nomura's Wealth Management business and the banking division is responsible for the product development side of that equation. So where is the room for future growth? First, there is significant potential to expand our client base. Our Wealth Management division already has 1 of the largest client bases in Japan, but we currently provide banking services to only about 600,000 accounts, which is roughly 10% of securities accounts with balances. At some other firms, banking services are provided to about 50% to 60% of securities accounts. So we recognize that there is still substantial room for development within the Nomura Group. We also see substantial room to expand the breadth of services. As asset accumulation progresses, an increasingly important need is emerging. Many clients are saying, "I want to continue managing the assets I have built up without selling them while also raising funds, borrowing against securities collateral was not necessarily a common behavior in the past, but in response to changes in the environment, it is steadily gaining traction. In particular, Web Loan which is used by a broad range of clients has grown by approximately 3x over the past 4 years. In addition, when it comes to expanding the loan business, the breadth of assets eligible for collateral expanded based on client needs, has become a major strength. Few competitors offer loans that allow investment trust foreign equities to be placed as collateral and a growing number of plants are transferring assets from other firms wanting to do so. Backed by the Wealth Management client assets, we are among the largest in the industry, and we see substantial room for further acceleration of growth. There is also significant potential in the trust and agency business. Our core trust asset administration business is a classic recurring business in which revenue expands in line with the growth of client assets. Investment trusts themselves are increasing in importance within the broader train to promote Japan as a leading asset management center and the market is growing rapidly. Looking ahead, we expect continued medium- to long-term growth and our strength lies in our ability to handle highly individualized project, including private assets, which are difficult for other firms to support, in fact, the publicly offered private the motor was the first in the industry to create leveraging the group's integrated capabilities, we hold a very high share in trust asset administration. In addition to overall market growth, we believe that our ability to provide the right services that address client circumstances will be a source of future growth. By making these growth opportunities visible, we will develop the banking division into an organization that contributes to stable earnings growth for the group by 2030. Our quantitative target is income before income taxes of JPY 50 billion, and we will strengthen our commitment to achieving the following KPIs as well. Loan balances of JPY 2.8 trillion, NTB investment trust balance of JPY 70 trillion and NPL assets under administration of around are particularly important element in achieving this is strengthening collaboration with the Wealth Management division. The Wealth Management division has a robust organizational structure built around client needs and is able to capture those needs with great precision. We at the banking division, will capture those needs in intensify communication and develop products that exactly solve client pain points. For example, we see significant room for development in loans for high net worth clients with large real estate holdings in their portfolios or products linked to workplace-based services for clients originating from workplace channels. I would now like to discuss Deposit Sweep an important initiative for realizing division I have just described. Deposit Sweep is a service that automatically transfers awaiting securities transactions from MRF into ordinary bank deposits. This is a service that builds a point of contact between Wealth Management division clients and Nomura Trust & Banking through the product clients are most familiar with deposits by offering this broadly to wealth management division clients, we believe we can dramatically accelerate growth in both account numbers and deposit balances. Through this initiative, we will achieve exponential expansion in account numbers and broaden our deposit acquisition channels, which, in the first instance, increased deposit balances to JPY 4 trillion, approximately 2.4x the current level, securing as a platform for future growth. As the balance sheet expands, opportunities for new product development will also increase contributing to improved service levels lowering funding costs and higher interest income. To realize this vision, we will continue to strengthen collaboration with the Wealth Management division and expand our client base. Finally, I would like to touch on strategic investments. The growth strategy I have outlined cannot be executed without upfront investment. To date, Nomura Trust & Banking have been focusing on building infrastructure, mainly for corporate services. This -- to scale the business over the mid- to long term, we must create systems that can withstand dramatic business expansion for that reason. In addition to the core banking system renewal and deposits implementation I mentioned earlier, we are making strategic investments such as building IT infrastructure that can support the sustainable growth of business that will expand significantly in the future. On top of the foundation we are building, we will layer products and services that deliver more advanced Asset Management, thereby attracting clients who need such services and further expanding our client base forming this virtuous cycle is the scenario for the banking division's sustainable growth. That concludes my explanation. The Banking division's role goes beyond simply providing banking functions. It is an important part of realizing more advanced and comprehensive wealth management services for clients by leveraging the full strength of the Nomura Group. Going forward as well, we will continue to evolve our products and services based on client needs and firmly contribute to the group's growth and enhancement of corporate value. Thank you.

Next, Mr. Koike, Head of the Investment Management division.

This is Hiroyasu Koike, and I assume the position of Head of the Investment Management division in April. I would like to explain the Investment Management division's initiatives toward the fiscal year ending March 2031. First, let me begin with a review of our performance. In the fiscal year ended March 2026, our division posted income before income taxes of JPY 88.3 billion and assets under management of JPY 136.9 trillion, supported by favorable market conditions and policy tailwinds, Nomura Asset Management, which is at the core of our public business drove the division's earnings. Its assets under management reached approximately JPY 111 trillion, marking a record high. In addition to public markets, the firm is also advancing strategic initiatives in private markets and the handling of private products and the gatekeeping business carried out in collaboration with external asset managers are both continuing to grow steadily. In addition, our major asset management companies, including Nomura Capital Partners and Nomura Babcock and Brown also delivered strong results. The new divisional management structure, including our U.S. and European businesses acquired from the Macquarie Group will operate globally as a one team to pursue further growth. At Nomura Asset Management, President Okoshi has been appointed, and Nomura Asset Management International will be led by Shawn Lytle as CEO. Chris Willcox, Executive Vice President of Nomura Holdings will continue to serve as Chairman and support divisional management, drawing on his extensive experience in the United States. With this upgraded division now managing approximately JPY 140 trillion in assets under management and employing approximately 2,380 people. We will manage the business firmly and aim to involve into a global asset management platform. Now let me explain the Investment Management division's new targets for the fiscal year ending March 2031. Thanks to the strong performance of Nomura Asset Management and the acquisition of Macquarie Group's U.S. and European businesses, the path toward achieving our previous targets has become clear. We are, therefore, revising our targets for the fiscal year ending March 2031, upward. Assets under management from JPY 150 trillion to JPY 180 trillion, and income before income taxes from approximately JPY 100 billion to approximately JPY 150 billion. We will achieve this through 3 key pillars: accelerating the growth of Nomura Asset Management, the core company of our division, steadily promoting our private business and strengthening the business of NAM International. Let me now explain these 3 strategies. First, Nomura Asset Management. Nomura Asset Management provides a comprehensive range of investment strategies, including active and passive strategies. In recent years, we have focused on strengthening our active investment capabilities and improving performance. Nomura Asset Management has been working to deliver strategy and investment performance at a global standard not only in Japan equities but also in global active equities. In particular, we have remained committed to in-house investment management and this has enabled us to win mandates for in-house global equity management from major domestic clients, including public pension funds. We also offer core strategies and publicly offered investment trusts. Going forward, through collaboration with Nomura Asset Management International, for example, overseas assignments aimed at developing investment talent and sharing research platforms, we will further enhance our global active management capabilities. Over the past several years, we have been shifting our business toward active strategies and private markets. At the same time, we've also been driving management reforms to improve profitability. As part of this effort, we have been strategically narrowing down our publicly offered investment trust lineup. Among the investment trusts launched in the past, some funds have seen a significant decline in assets under management. However, regardless of size, even small-scale funds require us to maintain high-quality investment operations. To improve management efficiency, we will continue to streamline our product lineup and by concentrating resources including talent on selected strategic businesses and products, we will continue our management reforms to enhance both investment quality and operational efficiency. Over the past several years, we have been focusing on the private business as one of our growth strategies. Three years ago, we had a team of 25 people, and we're managing a JPY 1.8 trillion institutional investor gatekeeping business. Today, that business has expanded to JPY 3.4 trillion with 60 people, including our business for high net worth clients in Japan. However, private business still accounts for only around 3% of total AUM. Many of our competitors in Europe and the U.S. have business to more than 10% of AUM. And over the long term, we will work towards reaching that level as well. As an interim milestone by March 2031, we aim to expand the share of our private business to around 5% to 6%. To achieve this growth, we will further expand our gatekeeping business while also strengthening our in-house investment capabilities and pursuing other growth initiatives. This slide introduces one example of the private business we are currently working on. At Nomura Asset Management through Nomura Alternative Connect or NAC, we are strengthening our platform that connects investors with leading private and alternative asset managers around the world. More than 70 private and alternative asset managers from around the world are registered on NAC, providing more than 100 strategies as well as information related to private markets. Through this platform and NAC's website, investors can access a wide variety of content, including diverse strategies around the world, enhanced risk management capabilities rich product lineup, educational content and updates on global private markets trends, not only institutional investors but also financial institutions that distribute private market products can access the platform and obtain a variety of useful information. For private asset managers registered on NAC, the platform also provides opportunities to reach investors in Japan, expand their distribution networks and enhance their brand recognition. By connecting investors and asset managers and working together with Nomura Asset Management, we aim to support the growth of the private and alternative markets. We will also leverage NAC as a high value-added platform to diversify and expand our business. The companies within the division engaged in private investment businesses are also steadily delivering results. At Nomura Babcock & Brown, which is involved in aircraft leasing, transaction volume reached a record high last fiscal year. And starting this fiscal year, we have also begun introducing aircraft funds to institutional investors. As for new initiatives, as part of our collaboration with the Macquarie Group, we have launched a co-branded fund. In addition, through our investment in the German ship-owning company Navigo, we are entering the ship and shipping business. In U.S. private credit, Nomura Capital Management, which manages assets in-house has delivered strong investment results. And going forward, we will begin considering full-scale cross-selling opportunities, including in Japan. Last December, Nomura Group acquired a U.S. asset management company from Macquarie and established Nomura Asset Management International. We have gained a platform in the world's largest asset management market, one that provides us with investment capabilities, a client base and a launching point for our global expansion. In addition to further strengthening our business in Japan, we will reinforce our business foundation in the U.S. market and steadily develop our global growth strategy. Furthermore, by integrating the operations of Nomura Asset Management's overseas business with Nomura Asset Management International, we will also enhance our presence in the European and Asian markets. By executing these medium- to long-term growth strategies, we aim to build a global asset management platform. Let me explain the key points for the growth of Nomura Asset Management International. In the United States, the world's largest market, the shift from traditional investment trusts and mutual funds to active ETFs continues. In addition, demand from individual investors for private investments is also increasing. Nomura Asset Management International has a strong presence in the U.S. However, looking at its product strategy, mutual funds account for about 90% of the lineup, while businesses driving market growth, such as active ETFs and private investments remain limited at around 10%. Although we have strong distribution channels in the U.S., marketing investment has been limited over the past several years. And as a result, there is a need to strengthen our distribution framework again. Accordingly, going forward, we will focus on the following two priorities: expanding our product lineup to match market needs and rebuilding a robust distribution platform by leveraging our strong channels. I will now discuss one of these key points, expanding our product lineup. The areas we will focus on are active ETFs and private credit. For active ETFs, while taking market needs into account, we will accelerate the launch of ETFs centered on strategies with a proven track record and competitive edge, such as high-yield bond strategies managed by NCRAM. We currently have 9 ETFs, and we aim to expand that number to around 30 by 2030. ETF assets are expected to grow from the current level of roughly JPY 150 billion to around JPY 4 trillion. For private credit, we will accelerate our efforts primarily through NCM, Nomura Capital Management, which has built a strong track record through in-house investment management. The second point is rebuilding our distribution structure. To strengthen coverage of our existing major distribution channels, we have begun rebuilding our structure, including new hires. Specifically, there are clear gaps in coverage in key asset management regions in the U.S., such as the West Coast and Northeast. And by allocating sufficient personnel, we will steadily capture business opportunities. We will also further strengthen collaboration across the Nomura Group. As a first step in April, we launched the Nomura Emerging Open as a publicly offered investment trust in Japan using an investment strategy from Nomura Asset Management International. Its current AUM exceeds JPY 150 billion. In addition, by advancing integrated operations with Nomura Asset Management's overseas offices, we will expand global cross-selling. These priority initiatives will require upfront investment, but we will reinforce our business foundation and aim to expand earnings in the future. Going forward, we will work to build a global asset management platform and aim to evolve into a growth engine for the group. To achieve this, talent development is absolutely essential. As part of our global collaboration, we will continue to send approximately 10 people per year overseas, including investment professionals. By developing a large pool of talent with experience and insights in the highly competitive U.S. asset management market, we aim to become a truly unique global asset management company unparalleled in Japan. We are confident that the people we develop in this way will play an important role, not only in our asset management business, but also as a future source of competitiveness for Nomura Group as a whole. I firmly believe that this business integration with Nomura Asset Management International represents a major step forward in value creation, not only from the perspective of global growth and asset management, but also from the perspective of human capital management. This concludes my presentation on our initiatives for investment management toward the fiscal year ending March 2031. Thank you for your attention.

Last but not least, presentation by Mr. Willcox, Head of Wholesale. Please go ahead.

Hello, everyone. It's great to be back here in Tokyo to address you today, and I'm excited to take you through our strategic plan. Three years ago, at this forum, I laid out a new strategy and direction for the Wholesale division. At that time, our ROE was languishing below 3%, and our international business was struggling to break even. I therefore, identified 3 immediate and critical priorities for the business. Stability by lowering our cost income ratio and improving our risk discipline, growth by building our critical mass in the core products and lastly, diversification of our business portfolio. My message today is that this strategic plan is working. Wholesale revenues and pretax income are now at all-time highs and our international platform has decisively turned the corner on profitability. However, this is more than just a turnaround story. Not only is our plan working, but wholesale is now operating as a central driver of high-quality earnings for the firm. And I'll demonstrate that there is still opportunity for further growth and further bottom line accretion. As such, I'm pleased to announce that we are raising our 2030 targets in support of the group's overall ROE ambitions. So let's get started. The strategy I announced back in 2023 could justifiably be labeled as boring. But I'm told by my Japanese colleagues that boring doesn't translate well. So let me clarify carefully considered and focused on steady and sustainable growth. There were no moonshot plans, no silver bullets to improve results. It was a back-to-basic strategy rooted in the idea that we needed to refocus on our core strengths manage our operations efficiently and achieve a stable diversified product mix focused on clients. Admittedly, yes, a cautious strategy but one that can produce very exciting results. Wholesale pretax income is up approximately 7x since the fiscal year '22/'23. And we are well ahead of plan on each of our KPIs. Revenue over RWA stands at 7.4% versus our original target of around 6%. Our cost income ratio has dropped to 83% against our target of getting to 80%. And our ROE is now around 10% at the top end of our original 8% to 10% range. Our strategic dashboard provides further evidence of success. Revenue volatility has sharply decreased, and the growth has been broadly distributed with a notable step-up in capital-light fee-based businesses. Our diversification into international Wealth Management has been an extraordinary story of organic growth with AUM exceeding $40 billion. Importantly, it is not a single year of strong performance. It's a culmination of consistent delivery against our original strategic framework. Fiscal year '25/'26 was a record year for wholesale on virtually every measure. Revenues and profitability reached all-time high since the establishment of the division in April 2010, and both Global Markets and Investment Banking delivered their record revenues. Today, wholesale revenues are 50% higher than they were in '22, '23 when we embarked on this plan. Of course, we should not discount the strong supportive market conditions that have aided our growth trajectory. But we should also not underestimate the investments and the strategic focus of our teams that have helped define this outcome. And finally, growth has been broad-based. Every major product contributed to this journey, and all this was achieved with financial resources that have been pretty much flat to historical levels on a like-for-like Basel II and a half basis. Our revenue has been built on 2 engines, a leading Japan franchise and a growing international platform. The Japanese market backdrop in recent years has offered one of the most attractive structural opportunities with central bank policies, corporate restructuring and governance reforms creating multiyear tailwinds. As the top-ranked broker dealer, we are best positioned to capture it. Japan wholesale revenues are up approximately 60% versus '22/'23, reaching their highest level since '16, '17. Clients trust us repeatedly. We are #1 in Japan equity products, M&A, ECM and credit. We were recognized as Bank of the Year in Japan in 2025. And as the Top Research, Trading and Execution Firm. Internationally, the story is one of continued momentum. We've successfully demonstrated that a focused model can win and win profitably. International wholesale revenues up approximately 45% since '22/'23, and profitability is also an all-time high in that time frame. And our -- the recognition and rewards speak for themselves. We've built top-tier positions in our target segments. Top 3 in AEJ EM Credit, #2 in U.S. Listed Equity Options, #4 in U.S. RMBS and #6 in Global Cash Equities. We were named RMBS Bank of the Year in the U.S. for the fourth consecutive year and won CMBS Deal of the Year for 2026. We were also recognized as Credit & Interest Rate Derivatives House of the Year in Europe and in Asia. This repeated recognition reaffirms that the strategy is succeeding. Three years ago, I said that our franchise was operating as less than the sum of its parts, despite its many strengths. Frankly, we managed ourselves as 4 distinct regions, leading to duplication, inconsistency and limited cross-border flow. We, therefore, chose to deliberately reorganize our businesses around a cohesive global structure. And today, as a result, we see greater coordination, a unified client approach and enhanced efficiency in our operating model. We have globalized all of our major products and functions. In equities, we have successfully leveraged our leading Japan and Americas franchise into EMEA and Asia. EMEA equities revenue has approximately doubled since then, and AEJ is up over 60%. Next, we have enhanced regional and product collaboration. A good example is private markets distribution into Japan, successfully responding to strong investor demand. And finally, we've significantly enhanced our cross collaboration. The number of GM cross referrals has doubled and IB cross-border M&A deals up around 45% over 3 years. Our client franchise client franchise is absolutely at the core of our wholesale business and of this plan. Our improved performance is almost perfectly correlated with growth in our client revenues. This drives not only the quantity, but also the quality of our overall results. We've made two deliberate choices in our client strategy. First, a focus on productivity, investing in talent, globalizing our sales organizations and promoting cross-sell. As a result, international GM sales productivity has more than doubled since '22/'23, and an international investment banking MD productivity has increased by 40%. Second thing is targeting high-growth client segments. In Global Markets, real money client revenues are up 65% and in IB sponsors revenues are up 80%. This story of consistent performance is a natural segue into our future growth plan. Given our momentum, I'm very confident to upgrade our 2030 targets in line with our firm-wide ambition announced earlier by Okuda-san. We have increased our revenue over RWA target to 7% plus from 6%. We will reduce our cost income ratio to less than 80%, and we expect to deliver a pretax return on equity above 10%. These are meaningfully more ambitious goals. And critically, these targets are designed to deliver through the cycle and not just at the peak. So let's talk about how we get there. The first lever is a pivot towards higher ROE areas. By fiscal year '30/'31, we expect more than 80% of our businesses to generate ROEs above 8%. Revenue expansion in capital-efficient businesses and prudent resource deployment will be the key drivers of this effort. So on the right, you see our growth objectives. By fiscal year '30/'31, we expect fee-based businesses, including international wealth management, global advisory, ECM, DCM and execution services to grow by 30% to 35%. And Structured and financing businesses will increase by 35% to 40%. And our flow and trading businesses are expected to grow by 25% to 30%. This is not about deprioritizing any one business. It's about targeting a balanced business mix, which is optimally positioned to benefit across market cycles. The second lever is operating leverage. Three years ago, we were a subscale platform with an ROE of approximately 3% and a pretax margin of approximately 5%. Today, we have scale across a balanced business mix with ROE of around 10% and margins of around 17%. This demonstrates that for every dollar of investment, we are generating higher revenues than before. Scale, begets scale. By 2030, we will target growth by ensuring a more diversified business mix. What you see on this chart is not necessarily an end-state ambition but is a through the cycle target. This will drive both resource allocation and investments across our businesses and this broader, more balanced base will unlock through the cycle ROE of 10% plus by fiscal year '30/'31. We've targeted our strategies to grow our businesses through 2030. In Equities, we expect 20% to 30% revenue growth through expansion in Japan and in the U.S., investments in EMEA and AEJ and build-outs in Prime and Solutions. In macro products, we target 30% to 40% growth in flow rates, Derivatives and Solutions and FX, yes. In Spread Products, we expect 30% to 40% growth in financing structuring and expanding into new verticals such as commercial real estate and some mere credit. And then in International Wealth Management, we are targeting an AUM of over $60 billion. Turning to banking. In Global Advisory, we target 50% plus growth, while in Financing & Solutions, more than 30% growth will come from broader product reach and deeper cross-sell initiatives. We will anchor these growth plans across 4 key initiatives. First, the client franchise. In GM, we will increase high-value flows in real money insurance sponsors and corporate segments. In IB, we will increase penetration in subsectors by strengthening differentiated content. Second, our targeted growth initiatives. We will expand into new areas like U.S. commercial real estate, prime and solutions. We will strengthen our international IB capabilities with a particular focus on the U.S. And third, platform enhancements, where we will continue to strengthen front office risk and accelerate AI adoption. And finally, we will build on our recent partnership success with Park Square Capital in Prismic and identify new opportunities, particularly in securitized products and private credit and equities. Cost discipline remains critical to our operating strategy. Our track record is self-evident. Our cost increase of 2% year-over-year was significantly lower than that of our U.S. and European peers. And as you can see, despite the scale of growth delivered, our fixed cost inflation has been materially contained. This is another example of operating leverage and helped reduce our cost income ratio by 13 percentage points. Looking ahead, we plan to accelerate nonpersonnel savings, including trade-related expenses and vendor contracts, improving efficiency in our front office technology and leveraging generative AI in our core operations. And finally, comprehensively review our front-to-back processes and make targeted investments for cost optimization. Together, we think these actions will provide a clear path to drive our cost-to-income ratio below 80% on a sustained through-the-cycle basis. Lastly, the third lever to strengthen our ROE is resource efficiency. Our focus is twofold. First, we will maintain a balanced distribution of resources across our macro products, spread products, equities and International Wealth Management businesses. While the proportion may change all businesses will see increased resource allocation over time generated through self-funding. Second, in addition to generating capital via self-funding, we will continue to actively pursue RWA optimization to create further capacity for growth. So to conclude, we have delivered a genuine turnaround over the past 3 years. Wholesale revenues and pretax income are at record highs, and our KPIs are either ahead of or at the top end of our original targets. On the back of this progress, we are confident to raise our 2030 ambitions. Our building blocks are unchanged, stability through scaling high accretion businesses and maintaining robust risk and cost discipline, growth through deeper client penetration and expanded product access and diversification through accelerated international wealth management expansion and enhanced cross-sell. This is a wholesale platform with momentum, but discipline and with a clear path to deliver sustainable returns through the cycle. Thank you for your time and attention today.

Thank you very much. We will now take your questions. Those of you joining via the phone, the operator will explain how to ask questions. And you can also ask questions via the chat function on the website. There's a message function at the bottom of the screen, so please use that.

This is Muraki from SMBC Nikko Securities. Regarding the ROE target, yes, 2 questions. First, about the ROE. In the first presentation on Page 3, you show the KPIs. Until now, Okuda-san, you were saying the ROE target for Nomura was through the cycle. So even if you achieve a target for a certain year, you won't raise it. But this time, you have raised the bottom from 8% to 10%. And what discussions did you have internally? What is your resolution that led to this conclusion of raising the ROE target? And if you look at the bottom right, the wholesale ROE target of 10% plus. Are you happy with this level from a holdings company perspective? I don't know what to compare this with, but maybe JPMorgan, 18%; Morgan Stanley, 17%. And that's the wholesale division ROEs. And in terms of cost-to-income ratio, JPMorgan, 49%; and GS, 57%. And so I wonder how the Board and the senior management sees this difference? Maybe your targets are maybe too conservative or maybe you lack scale or resolution? Yes, please explain the reason for the difference. And my second point is Page 8. The strategy -- strategic talent allocation for growth, at this time, you have made big changes to the management team. And for wealth management and IM banking, which are doing well, you made such a big change despite the business is doing well. So why was that? And in terms of next-generation talent development, how will you use the positions of these division heads and subsidiary heads? This may be hard for you to say with so many employees listening in, but to the extent possible, please.

Thank you. This is Okuda. Muraki-san, thank you for your question. Your first question about the change of the targets and how we think about it, what we discussed internally. Yes, and we have a strong resolution behind this change. And we don't recklessly change our targets just because we achieved them in a single year. And the same thinking applies to this change that we made this time. And in terms of the time line, last year at the CEO forum, there were comments about how we had already achieved targets. So why not change the target. And I said we were discussing at the time. And today, we said we will announce the new targets in the Investor Day, if possible. And during that time, we had intensive discussions internally. And in terms of what we discussed, we thought about the future business lines of Nomura and where we should invest in and how we want to achieve growth. So it was a reconfirmation process. And in those discussions, we especially focused on the resource allocation. And we had the heads of each division, including the weekends and spend a lot of time discussing that. And although you didn't ask your question, we talked about the balance between investments and returns and where the best mix is. We also discussed, including the outside directors and this may go somewhat aside, but we have many international outside directors. So we talked about increasing dividends and also share buybacks. And why 40%, 10%? That was another topic. So we went back to the basics in our discussions. And in those discussions, we came up with an increase from 8% to 10% and 10% to 12% plus. One factor behind that was now the Nomura has really been changing as a group, and we are achieving strong performance. And for example, in the Japan capital markets, there's a lot of attention worldwide. And within that, the Wealth Management business and the IM, Investment Management business, which is mainly Nomura Asset Management and the Asset Management business, have started to generate very stable revenues. And for Wealth Management, the -- we are saying 100% recurring revenue coverage ratio. And if we can achieve that, we will be building up stable revenues, and we have much more visibility on our earnings going forward. So that was one factor. And for banking, we talked about the number around JPY 50 billion today. But in the past, it used to be very small, but we think, especially with the deposit sweep service, and by rethinking about the business line, as Sugiyama-san said, if we include all those strategies, then IM and Banking can reach about JPY 200 billion of PTI, which is a target, which means for Wealth Management. The reason why money is coming into Japan is probably because of Asset Management Center of the government, but performance is very strong and corporate governance is being improved in Japan. So there are these big underlying trends in the Japan market. And so we think this is not just a cyclical cycle. It's a more long-term trend, structural change in Japan. And so we became more confident that we can generate stable earnings. And those were the factors behind the review. And going forward, you may ask this follow-up question. So just to answer in advance AI and digital. We will invest in those platforms. So we discussed what the best mix is. And for wholesale, as Chris Willcox explained, equities is doing very well, and there's demand for more resources. So we will consider the best balance of investments and SRC 2.0, it's about cost control, effective cost control. We also discussed that and came up with a number of 10% to 12% plus. And even in a downside scenario, we would like to stably achieve the 10% ROE level. And we are -- we have a certain confidence. And as we manage Nomura, we feel that the group is really changing. So we want to deliver results. Thereby, we wanted a more accurate target and discuss with the markets about our KGIs/KPIs. And in the past 6 months of discussions, we talked about market cap, ROE, share price, not just where the share price should be, but also -- we think the market doesn't fully understand Nomura's changes. So we think there's more effort that we as top management can make. And we have set up the IR team several years ago, and we have strengthened that. And we also talked about the brand today, but we want people to understand that Nomura's Group is changing, and we will keep communicating that message to investors and our stakeholders and get them to understand this change. And that will be our brand strategy, which we have started. So it's a result of these overall initiatives. It's not just about earnings but also about cost control, and we want to communicate to the market that we are changing and yes, we are doing a lot of global peer analysis with commercial banks and also broker-based investment banks similar to us and the likes of GS, Morgan Stanley, which are bank holding companies, which have a wide-ranging business. And we are assessing what differences there are and communicating the changes to the market and keep reforming the group and go upward. That is our resolution behind this announcement. In terms of your question about the talent allocation, Wealth Management, IM, Banking are doing well. And yes, we made some changes to the senior positions. And this is our philosophy, but what I always say to our colleagues is when and doubt choose the bigger change. And I myself have been following that philosophy over the past few years. And in terms of these new changes, like Sugiyama-san, Head of NTV and the Banking division, and for the Nomura Wealth Management business, we thought about what true Wealth Management is. And Sugiyama-san had been thinking about that. And there's the securities-related business and the bank-related business, and we thought of how we can combine that within the compliance rules to provide to clients. And we felt that was very important. And we also have International Wealth Management. And in that business, we are able to combine securities or broker business with banking. But in Japan, that isn't the case. And our client segments, we have the ultra-high net worth to the asset building segment. It's very wide ranging. So we discussed where the client needs are for each segment and what services we should provide to those segments and we've been discussing that and focused on that for the past few years. And Tobari-san, the new Head of Wealth Management, if you look at his career so far, he was branch manager of Kyoto, which is a very traditional business. So he has that experience of wealth management. But after that, he was in charge of digital, and he also worked on the workplace business, which we are focused on, which are businesses that weren't really headed by our senior management, and those businesses are growing now. So by appointing Tobari-san to the Head of Wealth Management, the aim is to combine the traditional wealth management as well as the future growth areas, including workplace and also customer digital services and the stuff we're working over the weekends to cover clients and working together with clients when they move big amounts of money. And he has been in charge of building that business. So it's good to have someone like Tobari-san who understands both sides of the business to further grow this business. That's why we appointed him to the Head of Wealth Management. And in terms of the next-generation development and how we think about the positions of the division heads and region heads, and thank you very much for asking precisely what I wanted to talk about. It's not something I can't explain to employees actually. And for example, we have pointed Koike-san as Head of Investment Management, who used to be the Head of Nomura Asset Management. This is someone in the past, people who are senior positions at Nomura Securities tended to become head of subsidiaries and they retire. But now that is not the case. We are very much more strategic and at the moment, I'm talking from the Head of Holdings position, but we have made very strategic appointments to the heads of divisions. So we want young people to experience the leading positions. And then joined the senior management of Holdings. So since I took over, that has been the new policy. And so Koike-san, who was Head of Nomura Asset Management, now becoming division head is great. And same with Sugiyama-san. I don't think he feels he has been kicked out of the group. We are strategically strengthening the banking division right now. And when he -- yes, eventually, he may come back to Holdings, which is great. So those of you listening in on our employees, please feel comfortable with moving sideways. And also for example, corporate functions, we have some new types of appointments that we are making, and finance people are moving to a pro. We don't really mention this, but these are changes in our HR appointments over the past few years. So we are taking a group-wide approach in developing our talent. And when we set up Holdings, about 80% was Nomura securities. Now it's the U.S., which is making the most money in wholesale, so a big change. And we are changing the way we manage the group. And that is what led to these recent senior appointments. And this shows my message to the group and outside. I hope that answers your question.

And regarding the ROE target?

Yes, I understood your strong resolution behind it, and it was the discussions, thank you.

This is Watanabe of Daiwa Securities. ROE target lower bound -- positioning of the lower bound. What if the forecast would be lower than the lower bound, 10%. Will you reconsider buyback? And you also talked about the mix between investment and shareholder return. What's the reason you did not change the policy of shareholder return this time around? Second big question. On AI, you mentioned across group efforts. Wholesale, IT investment is less than other peers. What's your competitive advantage? Wealth Management AI agents capability is rising. Where are the value added of sales partners?

Watanabe-san, thank you for your question. This is Okuda speaking. Let me respond to your questions. So what about the commitment you mentioned, even when market environment isn't favorable we want to deliver at least 10% ROE. That is our determination as we revise upward the numerical target for ROE. Your question is what if the environment is unfavorable so much so that ROE will be below 10%. Will there be coordination made? First of all, regarding buyback, we also think about investment opportunities. ROE hurdle rate capital cost. If there are opportunities that outperform that, we use surplus capital to investment and accumulate capital and increase ROE. If we don't find many investment opportunities, we may become more active in providing shareholder return. Now that timing hasn't arrived yet, so there could be debate. But if we don't find investment opportunities and the environment isn't desirable in order to achieve the target, we could be flexible in our capital policy that could be included in our horizon. Secondly, you mentioned AI. The investment amount in comparison to the U.S. large peers is less. So what's the advantage that Nomura has. Now in terms of the amount of money invested, you're right. However, the use of AI is a key. And this is unlimited to financial institutions, but each company has its own way of use. In our case, efficiency, yes, there has been good use cases. And in other companies, there have been good use cases for efficiency purposes. So even if we don't invest as much as the U.S. peers does, we can catch up in terms of efficiency, but how can AI be positively influencing the top line. And this is a point that all companies are struggling regardless of the amount of investment. When I participate in international conferences and meet with top management of banks and financial institutions, this is the big question. Yes, AI does contribute to cost efficiency and efficiency, but ROE remains low. And there are differences between Japan and Europe, but the United States can do job cutting. But there are countries with more stringent labor restrictions, which disables us to job cut, so cost is difficult to reduce. And what do we do with that? There is debate amongst the senior management. So although the scale may be small as use case, we want to seek a way of use of AI to maximize top line. So even if the investment amount may be smaller, I think we have room for a competitive advantage against our peers. And wealth management would be the best match and IM would also be the best match. So we will concentrate in those divisions as we make investments. And your other question was AI agent emerging, how do we deliver added value from sales partners? In the Nomura business model, we think this is a positive tailwind. We are introducing digital and apps and where do we deploy people? There -- we deploy people to where funds transfer and also business succession or asset succession -- safe asset succession and the superiority or advantage of human beings in such areas remain unchanged. Population is declined. What do we do about recruitment? What's the best size of headcount? And how much can we train them by using AI I think we will be able to create time for training or contact between people, which will in turn translate into improved productivity. And we did personnel shift Workplace CDS digital using teams are improving productivity led by Tobari-san. By leveraging these teams, a group-wide profitability efficiency will be improved and training them by people can be improved. So I believe that the value-added crew offered by sales partner will further increase. Thank you.

This is Sato from JPMorgan Securities. One question regarding the resource allocation. And in the first presentation, Page 17, you explained the capital strategy and resource allocation. And you also talked about the shareholder return, and you discussed a lot about the right balance with investments. So I think compared to other Japan financial institutions, you are now entering a phase of focusing more on future growth investments rather than prioritizing shareholder returns. I guess you discussed that possibility. So did you discuss that? So the total payout ratio of 50%, are you not necessarily going to commit to that in certain scenarios. Was that a point of discussion, please? And the Wholesale division will continue its self-funding policy, I believe. But other than wholesale, and although this may not be factored into your plan, are there any areas of interest where you could potentially invest in. So what is your image of the scale? For example, last year, $1.8 billion you spent on buying the asset management business. But could there be larger inorganic opportunities are you envisaging that in your plans? So what is your investment appetite, please?

This is Okuda. Thank you, Sato-san, for your question. First, regarding the resource allocation and shareholder return and what we discussed. Yes, we did discuss how we are in the investment phase right now. And in terms of where to allocate our resources, yes, that was a topic of much discussion, including new and existing areas. And the markets are strong. So some divisions are asking for more allocation. So yes, we had very intense discussions about that. But in terms of the total payout ratio of 50% or higher, I do not plan to lower that. We didn't think so from the start. And we have always been using this as a benchmark. And we didn't discuss changing this, but we did discuss a lot about the topic. And the outside directors, especially the international members, they understand what the western financial institutions are doing and what their appetites are. So one way to do this was to lower shareholder return and invest more, but I didn't think at all about changing that. And in Wholesale, we are making them self-fund themselves. And again, there could be various views there, but nothing -- I'm not thinking of changing that policy either. And in terms of how to manage balance the growth as well as stable earnings. Well, that's where we plan to invest in businesses that generate stable earnings. And last year, we bought the asset management company in the U.S., which is an example of that. In terms of future acquisitions, which was also a part of your question, for asset management, especially in the U.S., there are some positives. And we are aiming for JPY 180 trillion, the $1 trillion club. So if there are good opportunities in doing so, we may consider. And in the earlier question, we talked about ROE, market cap and how we looked into all these factors. And the question is how to build a scalable business going forward. And we have no plans to make stand-alone investments, which do not connect to the larger group. And for example, Banking, IM, those are areas where you have been strengthening and the Japan Wealth Management business, too. We will use digital technologies. So I think there's more that we can do there. And those are the areas where we have targets and the $1.8 billion last year, your question about whether we could see bigger opportunities, bigger deals. Well, it's not like we have the number in mind, like $5 billion, $3 billion. But maybe, for example, in Japan, if there are opportunities to invest, we could consider them. But at this moment, we have not factored in such investments into the plan. So sorry that I don't have a good answer for you. But my answer would be if there are good opportunities, we may consider the opportunity.

And just a follow-up. On Page 17, the low profitability businesses and how you plan to review the low-margin businesses, please? I guess there are various ways to do this. Maybe you could lower the ratio of low ROE business. And you have stated that policy. But do you have any issues that are outstanding, whether it be divisions or entities in terms of low profitability. Are there any areas where you feel you need to monitor certain categories that you feel you need to monitor better?

Thank you for the follow-up question. This is Moriuchi. At the moment, there are no specific entities or business categories that we have in mind and we won't be able to answer anyway. But towards 2030, we will consider the financial resources and growth opportunities. And we will continue to discuss our priorities. And for some of the low profitability and low priority businesses, if any, we will take bold action regarding those businesses. That will be our stance going forward. I hope that answers the question.

Thank you. We are running out of time. So let's make next one the last question, please.

I have one question. ROE, in March '26, 10%, there was proceeds from sales of assets you will be revising that to 10% to 12%. So this is a target range. But pretax profit will be increasing to 1.5 fold. So your assumption, this range of 10% to 12%. What kind of environment are you assuming? And you've been talking about investment requirements? The denominator, what are you thinking about the denominator? Profits will be increasing according to your plan and the required capital. How is the required capital going to increase?

Tsujino-san, thank you very much. This is CFO Moriuchi responding to your question. Regarding the increase, Mr. Okuda says more than 50% total payout ratio and the necessary -- regarding the necessary capital, we are assuming the necessary capital to achieve that will increase. So that's the first point. And then regarding the business environment as we did a review of the 2030 Vision, we conducted a debate on variables and how variables will evolve. But as we have shown in ranges, rather than coming up with just one scenario in terms of business environment in certain cycles, what kind of movement will occur in interest rate and stock prices. But even with those changes in mind, we will achieve 10% to 12%. That's our determination as we announced this range. And JPY 750 billion pretax income, how do we position this? If you do the calculation, you will find out that this is towards the upper half of the range. So JPY 750 billion is our solid target. And even if the basin isn't favorable, we would at least achieve 10% ROE. So that's our target. I hope I answered your question.

Regarding details of total payout ratio of 50% or higher, capital will increase. I don't think we should be expecting a sudden and significant buyback. But Nomura's buyback. So including the buyback of shareholder return, are you saying 50%? Or are you excluding that when you say 50% or higher total payout ratio as you decide the amount of share buyback?

Thank you, Tsujino-san. Including buyback, total payout ratio of 50% or higher RSU, for that purpose, as you say, in buyback, that would be achieved partly through buyback. So that included this total payout ratio. But when we say 50% or higher total payback ratio excluding RSU. So on net basis, 50% or higher total payout ratio is what we aim to achieve. Regarding the portion of RSU, last fiscal year, Q3, I think we mentioned this at that timing. But in the deferred reward or compensation. Cash compensation is somewhat partly included. So the number of shares to be bought back is going to be declining according to our assumptions based upon that RSU.

With that, we'd like to end the Q&A session. And we will continue to take your questions at the IR Department of Nomura Holdings. Mr. Okuda will make the closing remarks.

Well, thank you, everyone, for joining despite your busy schedules and joining the Investor Day of Nomura. And we've got several questions, but I myself as the top management of Nomura feel the change undergoing at Nomura, and we feel these are positive changes and the structural reforms, thanks to everyone's efforts are now starting to bear fruit. And I really feel that as Head of Nomura. That's why we raised our targets at this time. And going forward, we will continue evolving the group so that we can be of help to our clients as we grow. And we have re -- I think we were able to show that resolution thus this Investor Day today. And I'm sure there may be many more questions and some parts may be hard to understand perhaps, so we will make sure to address those questions. And the senior management sees this not just as an aspiration. We have been fulfilling our targets in the past and we would like to do so again and achieve results. So we look forward to your continued support and advice on our activities. Thank you very much, and thank you for joining today.

With that, we would like to conclude the Investor Day. Thank you, everyone, for joining.