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New Year's Message From Japan Exchange Group CEO, Atsushi Saito

Date 04/01/2013

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As we welcome the New Year, I would like to offer my warmest greetings and wish everyone health and prosperity in 2013.

With the successful business combination between Tokyo Stock Exchange Group and Osaka Securities Exchange, this year marks a new start for us as Japan Exchange Group (JPX).

The JPX market proudly includes leading Japanese corporations, small and medium-sized companies with sophisticated technology and services, and emerging growing corporations, boasting approximately 3,500 listed companies and a total market capitalization that is only rivaled by the New York Stock Exchange and NASDAQ.

Our derivatives market also offers diverse futures and options, including those for Japanese government bonds and internationally renowned stock price indices, such as TOPIX and Nikkei 225.

In order to facilitate efficient trading of this wide range of products, we plan to consolidate the systems and integrate market functions of the cash equity markets in July, and do the same for our derivatives markets within fiscal year 2013.

We will also focus our efforts toward becoming the No. 1 market in Asia, preferred by the world's investors, by implementing initiatives to encourage IPOs, develop new products, and otherwise expand our attractive product line-up, as well as enhance our clearing and settlement functions.

Japan Securities Clearing Corporation, a core clearing company within the JPX group, began conducting clearing operations for Yen-denominated Interest Rate Swaps in October of last year, for which it has received much praise both domestically and abroad. With current obligations under assumption totaling JPY 70 trillion, its business scale has surpassed the US's CME and Singapore's SGX, to rank behind LCH in the UK as the 2nd largest globally.

The expansion of clearing organizations is both a global trend and a national necessity. We will pro-actively work to develop our clearing capabilities and further enhance our presence through the business combination.

During the past year, the Financial Instruments and Exchange Act was amended in relation to a comprehensive exchange, and the launch of JPX is no more than a milestone on the path to enhancing the competitiveness of the financial and capital market of our country.

First, we will be channeling our full efforts toward realizing the benefits of this business combination as quickly as possible. JPX is dedicated to revitalizing the capital market and contributing to the recovery of the Japanese economy.

At the close of 2012, we elected a new administration here in Japan, the most recent in a series of presidential elections and changes in leadership across many nations, including the US, China, and Korea.

In addition to lowering estimates for growth in developed and emerging nations across the board, the OECD and IMF have called for appropriate fiscal and monetary measures to prevent a chain of global economic recession spurred by the European debt crisis.

Japan, the US, and China have a large responsibility as the world's three largest economies. Though each country faces limited finances and scopes of monetary easing available, I am confident each will enact rational measures from a medium-to-long term perspective under the strong leadership of their administrations.

Turning our attention to individual companies, we find a growing number of energetic emerging corporations within Japan. IPOs, which declined temporarily, have been on pace for recovery during the past 2 years, to reach 48 in 2012. We estimate that we will see further increase in the year to come.

Even amidst sluggish market conditions, stock prices following IPOs have proved resilient, and many companies have enjoyed a warm reception by the market.

As promising companies are listed, raise funds, and make leaps forward, it is important to remember that this is not only revitalizing the securities market, but also invigorating the actual economy through the expansion of employment, income, consumption, and investment.

We will continue working to attract new IPOs with the consolidated efforts and know-how of both TSE and OSE as we launch the "IPO JAPAN" promotion project nationwide this month. As we see more positive signs each day, I believe it is the time to establish a solid national strategy to create an environment for the cultivation and support of the companies which form the core of our economy.

I speak for all of JPX when I say we will put forth our best effort so that in the future everyone will reflect that "JPX became a new driving force for economic growth." I appreciate your continued support and cooperation as we move forward, and wish you all a very happy new year.

January 4, 2013

Atsushi Saito
Representative Executive Officer & Group CEO
Japan Exchange Group, Inc.