Presentation at Nomura Investment Forum 2015 (PDF)

Connecting Markets East & West

Presentation at Nomura Investment Forum 2015

Koji Nagai Group CEO Nomura Holdings, Inc.

December 1, 2015

? Nomura

1. Reconfirming FY2019/20 management target

Reconfirming FY2019/20 management target

Transform business model in Japan Improve profitability of international business

FY2019/20 management target

EPS Y100

2

Unwinding of six disadvantages sets corporate Japan free

1

Strong yen

2 High corporate tax rate

3

Delayed trade liberalization

4

Labor regulations (high labor costs)

5

Fiscal problems

6

Power shortages

August 2014

Yen depreciation from quantitative and qualitative easing

Announced policy to reduce to below 30% within a few years

Trans-Pacific Partnership negotiations

Addressing aging society/declining population Considering taking in foreign workers

Phased hike of consumption tax

Debate on restarting nuclear power plants

December 2015

Continued yen depreciation

Reductions started from FY2015/16

Agreed at ministers' meeting in Atlanta (Oct)

Activities to create a society in which all citizens are

dynamically engaged; Debate on easing labor rules

Bill to delay increase passed (rise to 10% in

March 2017)

Sendai Daiichi and Daini restarted

3

Corporate performance in Japan is improving

Overall strong profit growth in past four years

Profits above pre-crisis levels2

Ratio of international sales and growth in recurring profit of

Russell/Nomura Large Cap recurring profit (lhs)

companies in Russell/Nomura Large Cap Index1

40.0 Industries that benefit from increased

domestic demand 35.0

Electronics/ precision

Automobiles

(trillions of yen)

50

BoJ Tankan ? Business Condition DI (Large Enterprise, Manufacturing) (rhs)

BoJ Tankan ? Business Condition DI (Large Enterprise, Non-manufacturing) (rhs)

30

Expected recurring profit growth rate (annual %)

20

30.0 Construction

Industries that

25.0 Housing/

Software

benefit from yen depreciation

40

10

real estate

20.0

Transportation

Average:

30

15.0

Services

17.5%

0

Tele-

Food

Machinery

10.0ccoamtimonusni

products

Household goods

Retailing

5.0 Media

Pharma-

ceuticals/

Steel/non-fer. Metals/cable

0.0 Trading

healthcare Chemicals

companies

-5.0

0

20

40

60

80

International sales (%)

20

-10

10

-20

0

-30

03 05 07 09 11 13 15

(FY) Forecast

1. Source: Based on 17 companies from the Russell/Nomura Large Cap Index made up of NOMURA19 minus public interest and financial sectors. Vertical axis shows increase in expected recurring profit growth rate (annual) from FY2011 to FY2015; horizontal axis shows average ratio of international sales from FY2011 to FY2014. Forecasts based on Nomura research, supplemented by Toyo Keizai.

4

2. Source: Nomura, based on Bank of Japan data. BoJ Tankan Business Condition DI is quarterly average for each year, except FY15/16 which is average of Jun and Sep actual result and Dec forecast.

Japan's personal financial assets

Securities investment as percentage of personal financial assets has started growing again1

Mar 1981: Y372trn

Mar 1989: Y926trn

Mar 2013: Y1,579trn

Introduction of NISA (Jan 2014)

Japan Post Group IPO (Nov 2015)

Mar 2015: Y1,708trn

22%

Securities investment 20.0 Y81trn 15.0

10.0

5.0

0.0

-5.0 1971 1974

Cash and deposits,

58%

Y217trn 33%

Cash and deposits,

44% Y410trn

Insurance and pension reserves 27%

Securities investment

Y303trn

GDP deflator2(YoY)

15%

Securities investment

Y236trn

1977 1980 1983 1986 1989 1992 1995 1998

Cash and deposits,

54% Y847trn

Insurance and pension reserves 26%

18%

Securities investment

Y306trn

2001 2004 2007 2010

Cash and deposits,

52% Y883trn

2013 (Fiscal year)

Inflation

1. Source: Nomura, based on Bank of Japan "Flow of Funds Accounts". 2. Source: Nomura, based on Cabinet Office and Ministry of Internal Affairs and Communications data.

Deflation

Inflation?

5

Global business environment

Europe

2-yr Germany Bund yield(%) CPI, Euro area(%)

10.0 0.8

8.0 0.4

6.0 0

China

1-yr lending rate(%) GDP(%, YoY, rhs)

8.0 0.8

US

2-yr US Treasury Note yield (%) Unemployment rate (%, inverse scale, rhs)

4.0

7.5 0.6

7.0 0.4

6.0

-0.4

4.0

6.5 0.2

-0.8

2.0

6.0

Jan Apr Jul Oct Jan Apr Jul Oct

Jan Apr Jul Oct Jan Apr Jul Oct

2014

2015

2014

2015

0

8.0

Jan Apr Jul Oct Jan Apr Jul Oct

2014

2015

Regulatory environment for financial institutions

6

FY2019/20 KPIs

Division

Three segment pretax income Retail Asset Management Wholesale

Pretax income Client assets Recurring revenue (cost coverage ratio) Pretax income

AuM Pretax income

Revenues Expenses Fee pool market share

KPIs as of Aug 2014

Y450 ? Y470bn Y195 ? Y205bn

Y150trn Y150bn (Approx. 50%) Y45 ? Y50bn Y50trn Y210 ? Y230bn $9.8bn $7.6bn

3.7%

KPIs based on environment changes

Y450 ? Y470bn

Y195 ? Y205bn Y150trn Y150bn

(Approx. 50%) Y55 ? Y60bn

Y50trn+ Y200 ? Y220bn

$7.9bn $6.1bn 3.4%

7

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