This document summarizes Daiwa Securities' efforts in impact investing for sustainable development in Africa. It discusses how Daiwa has leveraged its financial capabilities by arranging impact investment bonds focused on climate change, poverty alleviation, healthcare, education, and other issues. Specific examples highlighted include Daiwa's arrangement of vaccine bonds through IFFIm and GAVI to immunize 370 million children, microfinance bonds through IFC to provide loans to micro-entrepreneurs, and an education bond through AfDB to support skills training programs in Africa. The document also shares the results of a survey finding strong investor interest and support for impact investing.

1. 31 May 2013
IWAI Toru
Daiwa Securities Co. Ltd.
Impact Investing for
Sustainable Development
TICAD V Official Side Event by FASID
The Potential of Impact Investing for African Development

2. 2
Mission
▼ Leveraging Financial Capabilities
towards a Sustainable Society.

3. 3
Growing Africa
Share of World GDP %
2010 2030 2050 Issues
Sub-
Saharan
Africa
2.6 3.6 5.1
Job,
Education,
Health, etc.,
Japan 5.8 3.4 1.9 Aging
Source: Economist Intelligence Unit, "MEGA CHANGE The World in 2050"

4. 4
17%
32%
18%
3%
30%
55%
7%
7%
4%
27%
Billions of dollars, as of the end of 2009
Japan* United Kingdom* Germany* France* United States
(%) (%) (%) (%) (%)
Total Financial Assets 15,638 100.0 6,709 100.0 6,688 100.0 5,388 100.0 44,510 100.0
Currency and deposits 8,592 54.9 1,913 28.5 2,560 38.3 1,553 28.8 7,756 17.4
Life insurance and pension fund reserves 4,228 27.0 3,615 53.9 2,241 33.5 2,126 39.5 13,191 29.6
Shares and other equity 1,104 7.1 744 11.1 523 7.8 879 16.3 13,972 31.4
Mutual funds and securitis other than shares 1,047 6.7 218 3.3 1,315 19.7 504 9.4 8,135 18.3
Others 668 4.3 218 3.3 49 0.7 327 6.1 1,457 3.3
Total Financial Liabilities 4,085 26.1 2,474 36.9 2,193 32.8 1,864 34.6 14,068 31.6
Net Financial Assets 11,553 73.9 4,235 63.1 4,495 67.2 3,524 65.4 30,442 68.4
Deep pocket is seeking
decent returns
Primary sources: Japan: Bank of Japan, Flow of Funds Accounts , June 17, 2010 United Kingdom: Office for National Statistics, Financial Statistics No 580, August 2010 Germany: Deutsche Bundesbank, Financial Accounts for
Germany 1991 to 2009. France: Banque de France, Financial Accounts and Financial Balance Sheets, June1, 2010. United States: Federal Reserve Statistical Release, Flow of Funds Accounts, June10, 2010.
* converted into US dollars based on the year-end exchange rates of GBPUSD=1.62, EURUSD=1.43, USDJPY=92.90
Household Financial Assets
Japan United Kingdom
Germany
France United States
Currency and deposits Life insurance and pension fund reserves Shares and other equity Mutual funds and securitis other than shares Others
Currency
and
deposits
Currency
&
deposits
Insurance
&
PensionShares
Mutual
funds
Others
29%
3%3%
54%
11%
20%
1%
38%
34%
8%
29%
9%
6%
16%
40%
Insurance
&
Pension
Shares
Mutual
funds

5. 5
No-financial return
Private
Public
(ODA)
Charity
Grant Aid
Donation
Yen Loan
Investment
Financial return*
Development Funding types
*Possible negative return due to currency and credit risk and
so on.
Investing in Social Impact

6. 6
Others
35%
Daiwa
65%
Impact Investing Bonds
▼Uridashi in Japan ▼Daiwa Securities
Total 697.2 Total 450.2
(billion yen) (billion yen)
Climate
Change,
155.9
Poverty,
129.3
Vaccine,
124.7
Foods, 28.6
Education,11.8
Period ：
Mar. 2008
to
Mar.2013
Source ：
Daiwa Securities
Fixed Income Sales Dept.

7. 7
Frontloading Future Donations
▼ IFFIm funding is utilized to reduce the number of
vaccine-preventable deaths through GAVI programmes.
▼ IFFIm issues Vaccine Bonds based on long-term
donor pledges.
Source: World Bank, March 2013

8. 8
GAVI*/IFFIm**Vaccine Bond Impact
▼“The GAVI model” has
contributed to the
immunisation of
370m additional children,
averting over
5.5m future deaths.
▼Daiwa Securities has
contributed to funding
1/3 of IFFIm Vaccine Bonds
Source ：GAVI Website
▼US$ 4.4 billion: GAVI dispersed from 2000 to Dec. 2012 (70 countries）
▼US$ 3.8 billion: IFFIm raised from 2006 to March 2013
▼US$ 1.9 billion: raised in Japan from 2008 to March 2013
▼US$ 1.3 billion: raised through Daiwa Securities to March 2013
▼ 60% of 70 countries approved for support are African countries
* The Global Alliance for Vaccines and Immunization
・・・ワクチンと予防接種のための世界同盟
** The International Finance Facility for Immunisation
・・・予防接種の為の国際金融ファシリティ

9. 9
Microfinance Bond
▼▼ IFC invests US$ 1.98 billion in 258 projectsIFC invests US$ 1.98 billion in 258 projects
through 178 MFIs and so on.through 178 MFIs and so on. (Source: IFC , as of March 2012)(Source: IFC , as of March 2012)
▼▼ SubSub--Saharan Africa $112 million in 50 projects, 36 clientsSaharan Africa $112 million in 50 projects, 36 clients
▼▼ IFCIFC’’ss investeeinvestee clients had an outstanding portfolio ofclients had an outstanding portfolio of
nearly 8 millionnearly 8 million microloansmicroloans, worth nearly US$12.6 billion., worth nearly US$12.6 billion.
(IFC Microfinance(IFC Microfinance FactsheetFactsheet As of December 2010)As of December 2010)
▼▼ Daiwa arranged US$ 0.6 billion IFC Microfinance BondsDaiwa arranged US$ 0.6 billion IFC Microfinance Bonds
Investors
Micro
entrepreneurs
▼▼ Creating Opportunities in Emerging MarketsCreating Opportunities in Emerging Markets

10. 10
Daiwa Microfinance Fund （DMF）
▼ Minimum Investing Unit ⇒ JP￥ 1,000 (US$ 10)
▼ Local Currency Lending⇒ No Currency Risk for MFIs
Investors (DMF)
Micro
entrepreneurs
MFIs
Investing Universe

11. 11
DMF Impact
▼ Creating opportunities for over 59,032 people
in developing / emerging countries
by lending US$ 55million to 20 ＭＦＩs.
▼ Key Findings
1. 20 MFIs GLP*: US$ 3 billion
2. 20 MFIs Outreach: 2.79million +α
3. Impacts over 2% of Total Loan Users at 20 MFIs
( *Gross Loan Portfolio. Source ：Daiwa Microfinance Fund 3rd management Report, as of Feb. 23, 2013, MIX Market, DWM）
・Distributor ・Advisor ・Asset Manager

12. 12
DMF Impact
Financial Return & Social Return
59,032 Improving QOL Stories.
￥
・Distributor ・Advisor ・Asset Manager

13. 13
Africa Education Bond Impact
▼ The African Development Bank (AfDB) offered the bond to Japanese
retail investors who can indirectly support a better future in Africa.
▼ AfDB implements programs to achieve the sustainable and equitable
economic growth of the continent.
(i) Higher education, science, and technology (HEST), with the aim of
producing human capital (scientists, engineers, researchers, doctors,
etc.).
(ii) Technical and Vocational Education and Training (TVET) to address
the skilled labour requirements of the productive sectors.
▼ AfDB Group Education Portfolio
No. of project Amount (million UA)
Primary and Secondary Education 27 436.10
HEST and TVET 24 487.15
Total 51 923.25
（Sauce: AfDB Presentation material at Daiwa Africa Forum July 21, 2010.)

14. 14
Event for Africa Education Bond
Daiwa Africa Forum in July 21st, 2010 at Daiwa Conference HallDaiwa Africa Forum in July 21st, 2010 at Daiwa Conference Hall
Speaker: Mr. Thierry de Longuemar, Vice President Finance, African Development Bank (AfDB)
Mr. Pierre Van Peteghem, Treasurer, AfDB
Dr. Boukary Savadogo, Manager of Education, Science and Technology, AfDB
Dr. Naoyuki Kawahara, Director, NPO Rocinantes
Ms. Keiko Sano, Director, E. Africa Division 2, Japan Int’l Cooperation Agency (JICA)
Ms. Agnes Chan, the Ambassador of the Japan Committee for UNICEF, a Pop Singer
No. of Audience: 221

15. 15
http://http://www.daiwatv.jpwww.daiwatv.jp//
Forum & Daiwa Internet TV
▼ Forum play back at
Daiwa Internet TV Website

16. 16
Impact Investing Awareness
70
69
33
79
37
56
17
0 20 40 60 80 100
水・衛生
貧困・飢餓
医療・保健
教育
社会基盤整備
気候変動
興味がない
102
83
64
52
11
0 20 40 60 80 100 120
成長性が見込める
社会性を重視した経営姿勢かどうか
利益を上げている
株主への還元
事業規模
89
38
30
0 20 40 60 80 100
双方
投資リターン
社会貢献
97
31
0
0 20 40 60 80 100 120
賛同する
大いに賛同する
賛同しない
▼ Do you care most about financial
returns or social returns?
▼ Do you support Impact Investing?
▼ What social problems are you seriously
concerned about?
▼ What aspect do you most value when
investing?
Yes
Strongly Yes
No
Both
Financial Return
Social return
Water
Poverty
Health
Education
Infrastructure
Climate Change
No interest
Revenue growth
Profit
Scale of operation
CSR strategy
Dividend
Source: Questionnaire at Impact Investment Forum, September 9th
, 2010.
Audience numbers 191 ; Respondents 86%