FinCity.tokyo

As part of FinCity.Tokyo’s roadshow to London, we hosted a successful roundtable event to update UK asset managers on the latest developments in Japan’s financial landscape. The discussions focused on mid and small-cap listed equities—a sector with untapped potential for overseas investors—and the significant progress of the “Japan as an asset management nation” policy, which is actively creating a favorable business environment for asset managers.

We were delighted to be joined by over 20 London-based asset management firms. We extend our sincere thanks to our distinguished speakers:

• Mr. Toshiyuki Miyoshi, Vice Minister for International Affairs, Financial Services Agency
• Mr. Masanori Yoshida, Executive Officer, Japan Exchange Group
• Mr. Zachi Schor, Founder and Chief Investment Officer, INNO Capital
• Ms. Maki Harayama, Director, and Ms. Tara Raeside, IR Consultant, J Eurus IR
• Mr. Yukihiro Goto, Head of London Office and Head of Global Equities, Nomura Fiduciary Research and Consulting, London Branch
• Mr. Daisuke Omote, Associate, Atsumi and Sakai, London Office

Retail investors’ appetite for investment in Japan is visibly growing. A key catalyst has been the expanded NISA program (modeled after the UK’s ISA), which features increased investment limits and an indefinite tax relief period. Furthermore, the return of inflation is influencing financial behavior, leading retail investors to seek higher returns, with foreign equities and funds being strong recipients of this channeling of savings.

However, Japanese equities offer an equally, if not more, lucrative return. This was corroborated by Zachi Schor, who has discovered and invested in a fascinating mix of Japanese companies, spanning from large to small-cap across various sectors. Beyond the solid global players, his fund also seeks out opportunities within the ‘vast and untapped׳ Japanese domestic market.These range from growth companies founded by savvy, socially motivated entrepreneurs to ‘traditional’ companies which may also become new growth stories. However, such serendipitous companies can often be less visible to overseas investors, a gap which J-Eurus IR is working to bridge through their dedicated investor relations efforts.

While the licensing set-up for asset managers in Japan is unique, it has become significantly easier for overseas managers to navigate. The Financial Services Agency (FSA) has provided clear guidance materials. Crucially, the Financial Market Entry Office (FMEO), run jointly by the FSA and Local Finance Bureaus, engages with overseas managers in English throughout the entire licensing process. FinCity.Tokyo also provides support, maintaining a network of Tokyo-based law firms, including Atsumi & Sakai, who are happy to mentor overseas firms and help them understand the specific licensing requirements.

FinCity.Tokyo stands ready to support overseas asset managers interested in capitalizing on this powerful momentum of channeling Japanese savings into investment.