CSK HOLDINGS : Strategy

(Presentation at Results Meeting for Fiscal Year ended March 31, 2008, as presented May 9, 2008)

Yoshito Fukuyama
President and CEO
CSK HOLDINGS CORPORATION

Future policy(1)

I would like to explain CSK Group's future policy and strategy based on the fact that we had to make a substantial downward revision to our forecasts for the fiscal year ended March 2008.

I will begin by outlining the causes for the revision. They were: (1) the securities business of Cosmo Securities; (2) the asset securitization business of CSK FINANCE; and (3) ESTREX,¹ the new securities system of CSK Securities Service.

With respect to the first cause, the securities business of Cosmo Securities, I have explained that CSK Group was previously not directly involved in the management of Cosmo Securities, but rather expected it to serve a catalyst for new business in the IT services field and to help CSK Group acquire knowledge by having within the Group a company that was actually involved in securities business. However, in recent years, efforts to rapidly expand Cosmo Securities operations have led to increased investment and high costs, and the results of this are now being seen in the substantial losses recorded in the fiscal year ended March 2008.

In the future, Cosmo Securities itself will change its business direction, aiming to focus on its traditionally strong retail operations, scale back its underwriting and corporate divisions, and review staff allocation. CSK Group positions Cosmo Securities as the core company in its securities-related business, which I will discuss later, and intends to actively strengthen cooperation in terms of personnel and management resources.

The second cause was the asset securitization business of CSK FINANCE. At the end of March 2008, financial institutions rapidly became less willing to provide financing, due to the impact of credit crunches in Japan and overseas triggered by the U.S. sub-prime problem. As a result, we have had to postpone several projects until the fiscal year ending March 2009, which had a large impact of our financial results. However, market needs remain strong for the large-scale, high-quality projects such as those owned by CSK Finance, and we continue to receive inquiries about the projects that have been postponed. Our future policy is to focus on recoupment of investments for the time being, and to substantially reduce our investment balance built up from the postponed projects and others.

1	New securities system, 'ESTREX': A next-generation securities system incorporating cutting-edge components based on our wealth of securities business-related expertise.