Q-1. During the financial results briefing, there was an explanation of the income statement, but there was no explanation at all regarding the balance sheet or capital efficiency. Your company has long faced challenges with capital efficiency, and the Tokyo Stock Exchange has also requested management that is mindful of stock price and cost of capital. Please explain why you did not provide explanations on the balance sheet or financial aspects this time, the decision-making process behind it, and the current challenges.
A-1. We sincerely acknowledge the point that our financial explanations were insufficient this time. It was not our intention to omit the explanations deliberately. Based on your feedback, we intend to enhance our financial explanations, including the balance sheet, going forward.
Q-2. Currently, we hold approximately 14 billion yen in combined cash and deposits and long-term deposits (as of the end of September), but the interest income is 18 million yen, remaining at an annualized rate of 0.26%. We have long requested improvement in yield, but the response has only been to the extent of adjusting to interest rate trends while keeping funds in ordinary deposits. Please explain how decisions regarding yield improvement are made and the reason why it appears nothing is progressing at present.
A-2. We are aware that there have been previous comments regarding the yield on our cash and deposits. Our basic policy prioritizes generating profits from our core business over earning returns from fund management. However, considering the recent environment, we are advancing discussions at the Board of Directors level aimed at improvement.
Q-3. Are decisions regarding deposit management made solely by the Board of Directors? Please explain the decision-making structure, including who makes the decisions and how.
A-3. We proceed based on discussions and resolutions made by the Board of Directors.
Q-4. Specifically, does this mean that the policy is set in a top-down manner by the President, and then the finance department and others consider the management policy based on that?
A-4. We have launched a project for the themes that need to be discussed, and we are currently holding discussions based on various proposals from the project.
Q-5. Even though you are receiving proposals from the project, isn't it true that nothing is actually moving forward?
A-5. Our company places importance on proceeding in a manner that satisfies all members at the Board of Directors. If even one person has concerns, we continue discussions until those concerns are resolved. Currently, we are proceeding while carefully examining the details, including proposals from financial institutions, which is taking time.
Q-6. Regarding the point about receiving proposals from financial institutions for A-5, even though it was discussed at the previous general shareholders' meeting, does this mean the Board of Directors' discussions are not moving forward because even one person has an opposing view? This feels very inefficient, so we request improvement on this point.
A-6. Rather than opposition, the situation is that we are carefully discussing within the Board of Directors the point of "why such a proposal is being made." On top of that, we have repeatedly gone through the process of receiving various proposals again from the financial institutions and then re-deliberating them at the Board of Directors. We sincerely accept your point and will strive for improvement in the future.
