Just before the expansion of NISA, can financial institutions change? December 12 25:20

The NISA tax incentive system will be expanded from next month. Taking this opportunity, attention is being paid to whether a flow from "savings to investment" can be achieved in Japan, where there is a strong tendency to "focus on cash and deposits."

In order to achieve this, it is necessary for financial institutions, which have been criticized for "disregard for customers," to change their stance to "customer-oriented." We interviewed them about how the field of securities companies and asset management companies is about to change. (Reporter Takahiro Sato, Hiroaki Tsuboi)

Japan Emphasizes Cash and Deposits

Personal financial assets in Japan have swelled to a level of more than 2100,<> trillion yen, but until now, there has been a strong tendency to focus on cash and deposits, and many people have taken a conservative investment stance.

In addition to the effects of the bursting of the bubble and the prolonged deflation and the rise in the real value of cash, the problem of the business attitude of financial institutions such as securities firms has been pointed out.

The Financial Services Agency (FSA) has severely criticized the sales methods of financial institutions that have given priority to short-term profits and buy and sell financial products in a short period of time or recommend products that do not meet the needs of customers. We have repeatedly called on financial institutions to ensure that they are customer-oriented.

In light of these findings, financial institutions are also changing.

1 Review the evaluation of sales performance

Four years ago, Daiwa Securities embarked on a major review of its evaluation system for sales employees.

With an emphasis on increasing the amount of assets entrusted to us by our customers, we shifted our focus to building long-term relationships with our customers rather than short-term revenues. In addition, we have abolished sales targets that were set for each product.

This month (December), I visited a branch in Ikebukuro, Tokyo, which has 4 sales employees. Mr. Masaru Kinugasa, the branch manager, has been in the sales field for 12 years since joining the company. When I was a rookie, my boss set me a goal of getting 80 business cards a day, and I was on the road all day.

However, it is said that the content of the proposal is changing due to the revision of the evaluation system. Ms. Kinugasa also instructs her subordinates to listen carefully to the needs of customers and propose products that suit each individual.

Kinugasa Branch Manager
: "Our job is to look for the needs of our customers, or more specifically, the needs that they are not aware of, and we believe that face-to-face consulting will play a role as we aim to invest from savings with the new NISA starting next year."

2 Approach to the younger generation

Traditionally, a major securities company has relied on face-to-face advice and has mainly focused on wealthy individuals and the elderly. As the number of accounts in the online securities market increases, especially among the younger generation, how to approach this demographic is also an issue.

SMBC Nikko Securities is trying to attract a new customer base, especially the younger generation, by disseminating investment information on its dedicated website.

On this site, there are articles such as the experiences of people who have started investing in order to acquire people who have never invested before as customers, and you can also buy stocks on the site.

The dedicated site is accessed more than 1000 million times a month, so in November we opened a page with new articles on NISA and investment trusts.

According to a questionnaire survey conducted online by this company in September, more than 11% of people expressed their intention to use the new NISA, with 9% saying they would definitely use it and 37% saying they would like to use it if possible.

Atsushi Yokoyama, editor-in-chief of the site, and manager of the Digital Marketing Department of SMBC Nikko Securities, said:

Yokoyama
: "I feel that there is a high level of interest, especially on social media, and I would like to try to create content that makes learning fun."

3 Asset managers verify products in-house

An asset management company is responsible for entrusting the assets of its clients and managing the financial products in which NISA invests.

However, the Financial Services Agency (FSA) has pointed out that reforms to improve investment capabilities are necessary, saying that the sophistication and efficiency of investment management are lagging behind, new entrants are not making progress, and product diversification is not progressing.

Nomura Asset Management, which has one of the largest asset management balances in Japan, began publishing a report card of funds that manage assets in May.

For products that are judged to be unsuitable for long-term asset formation or have poor investment performance, we impose a "red" mark to indicate that there are areas for improvement, and we clearly indicate improvement measures to investors.

In the future, the company will verify all of the approximately 700 publicly offered investment trusts, and will review and redeem trust fees for funds that do not fulfill the role expected by investors.

In addition, from next year, we plan to start verification not only in-house but also with external experts, which we hope will lead to raising the level of our operational capabilities.

Revision of the evaluation system for human resource development

In addition, there is an urgent need to develop "fund managers" who will develop and manage investment trusts. In order to develop human resources for investment management and strengthen investment capabilities, the company is reviewing its evaluation system, such as making a large difference in bonuses according to performance.

Managing Director
Honma: "The remuneration is designed to fluctuate very widely depending on the results of the investment, and I think it is important to provide an environment in which the asset manager can demonstrate his or her abilities, such as by providing incentives based on performance."

Becoming a financial institution that lives up to trust

To what extent can financial institutions contribute to the formation of individual assets by thoroughly taking a customer-oriented stance? I would like to take a close look at the "seriousness" of financial institutions that are engaged in reforms.

Hiroaki Tsuboi, Reporter
of the Economic DepartmentJoined
the Hiroshima Bureau
in 2013, worked in the Economic Department, and the Social Affairs Department before joining the current affiliation

Reporter
Takahiro Sato,
Economics DepartmentJoined in 2017, Kyoto Bureau, Osaka Bureau, Economics Department
, Securities Industry, etc.,
and
started thinking about my life plan