Tokyo Stock Exchange: Partial Revision Of Tick Size Structure

1. Purpose

When trading participants make a bid or offer for stocks, etc.(*1) in the Tokyo Stock Exchange (TSE) market, they are required to do so based on prices prescribed by the TSE’s Business Regulations in accordance with the price per share (*2) of such stocks, etc. (hereinafter referred to as “tick size(s)”.).

Due to sophistication and diversification of trading in recent years, demand for price formation at much smaller tick sizes is increasing considerably. In light of this, the TSE has previously decided to reduce tick sizes in tandem with the introduction of the next generation trading system scheduled for the latter half of 2009 (*3), taking both overall balance and understandability into consideration. In order to provide an efficient market structure and increase user-friendliness for investors, the TSE will reduce some tick sizes in price ranges in which one tick size is relatively large, in advance of amendments to tick sizes scheduled for the time when the next generation system is launched.

2. Outline

Item	Details	Notes
1. Revision of Tick Sizes for Stocks, Etc.	The TSE will revise tick sizes for stocks, etc. as follows. - If the price per share is more than JPY 100,000 but 300,000 or less:JPY 100 (instead of current JPY 1,000) - If the price per share is more than JPY 1 million but 3 million or less:	- Please refer to Exhibit.
2. Others	The TSE will revise tick sizes for equity options trading as follows. - If the floor price of the daily price limit for the underlying stock is more than JPY 100,000 but 300,000 or less: JPY 50 (instead of current JPY 500) - If the floor price of the daily price limit for the underlying stock is more than JPY 1 million but JPY 3 million or less: JPY 500 (instead of JPY 5,000)

3. Implementation Schedule

These revisions will be implemented in the summer of 2008.

Exhibit

Stocks, etc, refers to stocks, warrant securities, preferred equity contribution securities, investment trust beneficiary certificates, foreign investment trust beneficiary certificates, investment securities, beneficiary certificates of the trust issuing beneficiary certificates, and foreign stock depositary receipts.
With respect to warrant securities, a certain number of warrants will be treated as one share if such number of warrants can be exchanged with one share. With respect to preferred equity contribution securities, investment trust beneficiary certificates, foreign investment trust beneficiary certificates, investment securities, and beneficiary certificates of the trust issuing beneficiary certificates, one unit will be treated as one share. With respect to foreign stock depositary receipts, one receipt will be treated as one share.
“Outline of Plan for Developing Next-Generation System”---Final Report on Trading Participants’ Meeting for Creating Next-Generation System (Publicized on September 26, 2006)