KOBE CITY. FY2008 Kobe City IR Seminar Presentation. - FY2007 Results - AA (Stable) Zuihouji Park, Arima

Transcription

1 KOBE CITY FY2008 Kobe IR Seminar Presentation - FY2007 Results - Zuihouji Park, Arima AA (Stable)

2 Table Contents Table Contents Overview Kobe --- P3 Acceleration Furr Reform --- P13 Social Infrastructure --- P4 Future Vision Kobe --- P15 Economic Status --- P5 Funding Plans --- P16 FY2007 Results General Account Law Relating Consolidation Local Governments Four Fiscal Indicars Consultation System Administrative Fiscal Reform P7 P8 P9 P12 Appendix Tax Revenue Expenditure FY2007 Results Special Corporate Accounts Fiscal Indicars Respective Cities 1

3 1. Overview Kobe Fukui To Yonago Tori Maizuru To Nagoya Kobe Osaka Airport Kyo Otsu To Yokkaichi To Fukuyama Okayama Shodo Isl Akashi Strait Kobe Airport Osaka Nara Naru Strait Osaka Bay Kansai Int l Airport Awaji Isl Wakayama To Matsuyama To Kawanoe Tokushima 2

4 Overview Kobe Overview L Area km 2 6th Ranking among all 12 designated cities* Population 1.534mln 5th(As Feb FY2009) GDP (Nominal) 6.04trn yen 6th (FY2005) Kobe Average 12 Designated Cities Industry Well balance light, heavy high tech industries Food Beverage Breakdown Manufactured Goods Shipments (FY2007) Electrical Machinery Petroleum, coal, iron steel General Transportation Machinery Equipment Information communication electronics equipment Ors Sea transported import /export Number establishments (10 thouss) FY1995 FY trn yen 3th (FY2006) 72,788 6th (FY2006) Population Reached Record High Kobe Nation wide FY1997 FY1998 FY1999 FY2000 FY2001 FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 (10 thouss) 13,000 12,900 12,800 12,700 12,600 12,500 12,400 12,300 12,200 12,100 12, (%) Traditional Traditional food food brewing brewing industry industry Assembled Assembled high high tech tech health health care care industry industry Expansion Expansion port port led led growth growth in in heavy heavy industry industry Growth Growth chemical chemical clothing clothing industry industry *12 cities that report ir statistics: Sapporo, Sendai, Chiba, Kawasaki, Yokohama, Nagoya, Kyo, Osaka, Kobe, Hiroshima, Kitakyushu, Fukuoka 3

5 Social Infrastructure Kobe Well Well established established transportation transportation social social infrastructure infrastructure (such (such as as waterworks) waterworks) Post-earthquake Post-earthquake resration resration reconstruction reconstruction is is close close completion completion Companies Companies are are attracted attracted convenient convenient industrial industrial premises premises located located in in waterfront waterfront inl inl areas areas Extension Extension Hanshin Hanshin Expressway Expressway Project Project is is under under progress* progress* Kobe s Transportation Sky Kobe Airport Links 5 domestic cities Railway Toll Road Sea Shinkansen (Bullet Train) Railway System Expressway Port Kobe Japan Railways, Private Railways, Subways, New transportation system allows access in out Expressway networks such as Hanshin, Sanyo, Chugoku, Kobe Awaji Naru Opened in 1868, Port Kobe operates as a gateway around 130 countries approx.500 ports Kobe s Social Infrastructure Sewerage Rate flush ilet service 99.8% Public sewerage system 98.5% (National Average 92.4% 70.5% ) Water works Distribution rate 99.8% (National Average 97.2%) Park Park area per capita 16.5m 2 ( National Average 9.3m 2 ) Education (as FY2006) Total 607 schools, including 20 Universities (nationally ranks 2nd place) * Hanshin Expressway expansion is currently undergoing Urban Planning Environmental Impact Assessment Details such as operation, construction method, fiscal burden is yet be decided 4

6 Kobe s Economic Status Opening Opening Kobe Kobe Airport Airport had had a synergetic synergetic effect effect s s convenience convenience Kobe Airport 2.74mln visirs(as FY2007:2.97mln visirs FY2006) Opened in Feb-2006, recognized for its high convenience Shinkansen (Bullet Train) 5.08mln passengers (FY2005) FY2007:5.51mln passengers Shin-Kobe station marked its record high number passengers in FY2007 Port Kobe 2.26mln TEU (FY2005) FY2007:2.47mln TEU Rapidly resring port s competitiveness along with its 140th anniversary opening Attracting Attracting Businesses Businesses Achieved sell f 50ha industrial premises within 3 years (FY ) Number companies in each location Before airport opening After airport opening Port Isl (2nd Stage) Medical Industry Techno logistic Park Or Or Positive Positive Spill-over Spill-over Effects Effects Accounted for outsting convenience, academic research environment, world s fastest supercomputer is be installed in In April 2007, 3 universities opened in Port Isl Around 8,000 students newly assembled Influence on urism FY2005 FY2006 FY2007 Hotel occupancy rate 68.4% 73.5% 75.2% Number Tourists 27.3mln 29.2mln 28.41mln 5

7 2. Account Results Administrative Fiscal Reform View from Ikari Mountain 6

8 FY2007 Results General Account Increase Increase in in city city tax tax revenue revenue furr furr implementation implementation fiscal fiscal reform reform improved improved financial financial indicars indicars [Revenue] Despite a decline in corporate earnings, transfer tax revenue sources local governments new housing registration had accounted increase city tax revenue Transfer tax revenue sources had reduced amount tax grants local governments Independent Revenue Ratio had risen [Expenditure] Decline in payroll debt expenditure Mary Spending Ratio improved Revenue Revenue Expenditure Expenditure Total Amount 720.1billion yen Granted from Hyogo Prefecture, 17 Local Transferred Tax, 52 bond, 39 Granted from Government, 88 Total Amount 717.9billion yen Total Amount 727.1billion yen Total Amount 707.2bln Or, Total Amount 711.8bln *Breakdown ors: Money drawn 91.4bln Loan 59.4bln Cost properties, etc 119bln Total Amount 727.1bln Charge Commission, 15 Provision for Asset Revenue, 13 Tax Grants Local Government, 98 Money Transferred, 21 Or Revenue, 114 Changes from FY06 FY07 tax increased 13.3bln Y-o-Y Tax grants decreased 16.8bln Investment, 58.9 Debt expenditure, Public Assistance, Tax, 263 Independent Revenue 59.1% % FY2006 FY2007 FY2008 (Budget) % Payroll, Mary Spending 54.0% % 52.7% FY2006 FY2007 FY2008 (Budget) 7

9 Law Relating Fiscal Consolidation Local Governments The Law on Special Measures Promote Local Public Financial Reconstruction had only regulated fiscal reconstruction measured by local governments deficit Under new Law Relating Fiscal Consolidation Local Governments, four indicars give a broader faster insight local governments fiscal conditions Criteria Indicars Legally Binding Obligation Disclosure Gradual Measures The Law on Special Measures Promote Local Public Financial Reconstruction Deficit only Covered Ordinary Account only None (Applied by Local Government) Not required None Law Relating Fiscal Consolidation Local Governments Four fiscal indicars (Real deficit ratio, Consolidated real deficit ratio, Real debt payment ratio, Future burden ratio) Covers general accounts government affiliates Exists Report assembly after receiving assessment by audir Early Warning System Financial Financial indicars indicars released released from from FY2007 FY2007 results results / / Implemented Implemented from from FY2008 FY2008 8

10 Four Fiscal Indicars Consultation System Under new Law Relating Fiscal Consolidation Local Governments, four indicars give a broader faster insight local governments fiscal conditions To secure fiscal soundness, local governments with Real Debt Payment Ratios over 18% require prior approval from Ministry Internal Affairs Communication Fiscal Indicars Definition Early Warning Limit Real Deficit Ratio Ratio deficit (including general account) local government s stard fiscal scale Prefectures: 3.75% Municipalities: % (Subject fiscal size) Reconstruction Limit Prefectures: 5% Municipalities: 20% Consolidated Real Deficit Ratio Consolidated deficit all accounts local government's stard fiscal scale Prefectures: 8.75% Municipalities: % (Subject fiscal size) Prefectures: 15% Municipalities: 30% Real Debt Payment Ratio Future Burden Ratio Debt payments by general revenue local government's stard fiscal scale Outsting debt (including future burdens public enterprises, government affiliates) local government's stard fiscal scale Consultation System for Issuing Bonds 25% 35% Prefectures/designated cities: 400% Municipalities: 350% Above 25%: Limited Issuance with Approval Bonds/Loans issuance by local governments with Real Debt Payment Ratios over 25%, are limited or rejected by MIC (Ministry Internal Affairs Communication) subject certain projects Above 18%: Issuance with Approval Bonds/Loans issuance by local governments with Real Debt Payment Ratios over 18%, are required submit Debt Management Plan be approved under general rules Below 18% : Inform Consult Status Bonds/Loans issuance by local governments below 18% Real Debt Payment Ratio are expected obtain consent under general rules from MIC. However, y are also able issue bonds without consent, given prior report Assembly 9

11 Four Fiscal Indicars FY2007 Results Kobe Kobe s s Fiscal Fiscal Indicars sts sts well well below below Early Early Warning Limit Limit Real Deficit Ratio/Consolidated Deficit Ratio (General Account/Consolidated) Ordinary Accounts have remained in line with existing balance ratio Local public enterprises negative net worth are included in Consolidated real deficit ratio Not applicable for both General / Consolidated Accounts (No Deficit) Account Operations Deficit/ Surplus Ordinary Account Includes housing, airport +2 Special Accounts Nursing-care insurance etc +33 Sewage System Account Sewage disposals +190 Port Harbor Account Urban Development Account Management operation Port Kobe Development allotment sales residential real estates (JPY100mln) Hospital Service Account Operation civilian hospitals 40 Aumotive Business Account bus services 12 Rapid Transit Railway Account Subway services - Waterworks Account Waterworks +91 Industrial Waterworks Account Waterworks for companies +9 Since Waterworks, Port Harbor Account surplus exceeds Hospital Service / Aumotive Business Account deficit, no consolidated negative net worth is recognized Effective Debt Service Ratio Decline in outsting city bonds Urban Planning Tax was appropriated for debt expenditure deductions from this year (Below18%) Transferred Informed & Consult Status FY2005 FY2006 FY years Average (%) FY FY2006 Real Debt Payment Ratio FY2007 results nearly reached weighted average(14.2%) all designated cities Continuous Improvement in Real Debt Payment Ratio FY2007 FY2008 FY2009 FY2010 FY2011 Old calculation New calculation FY2012 FY2013 FY

12 Four Fiscal Indicars FY2007 Results Public Enterprises 16.9% Future burden for Local Government Retirement Benefits 7.1% Indemnity 1.3% 177.5% (Well under Early Warning Limit 400%) Future Future Burden Burden Ratio Ratio *Weighted average all designated cities 208.7% Public Enterprise Burden Market business 1.3 Meat center 4.2 Parking business Rural community sewerage Port Harbor Urban Development (JPY bln) Hospitals Aumotives Debt Burden 1.7% Bonds Outsting 73.0% Breakdown Future burden Bonds outsting will decrease Seacoast environment maintenance Urban area redevelopment 0.9 Rapid Transit Railway Waterworks 0.3 Reasons behind future burden ratio being lower than current Debt Service Ratio (current debt outsting / annual revenue) Bonds related earthquake resration is covered by tax reimbursed from government (Therefore, financial strength indicar ratio recurring prit are deteriorating) Major public enterprises such as waterworks port harbor account have performed well Under administrative fiscal reform guidelines, reorganization affiliated entities were imlemented Sewerage 66.3 Total 295 *Tax grant revenues will be deducted from tal in actual future burden Since FY1997, primary balance has continued be positive se administrative fiscal reform implementations are reflected in fiscal indicars 11

13 Post-quake Administrative Fiscal Reform Achievements Three-Year Urgent Plan for Kobe Improve its Financial Status (FY ) Renewed Plan for Improving Administration Finance (FY ) Budget deficit per fiscal year: Improved by around JPY216bln Headcount: Reduced by 2,185 Implementation Administrative Policy (FY2004-FY2010) Reduce outsting balance city bonds Reduce headcount Assessment administrative operations outsource certain operations private secrs Management reforms universities public enterprises FY2004-Present FY2004-Present Outsting Balance Bonds: Reduced JPY528.5bln Headcount(including organizations):reduced by 2,223 Budget deficit per fiscal year: Improved by around JPY64bln Post-quake Post-quake Administrative Administrative Fiscal Fiscal Reform Reform Achievements Achievements (FY1996-FY2008) (FY1996-FY2008) Budget Budget deficit deficit per per fiscal fiscal year year Improved Improved by by around around JPY280bln JPY280bln Headcount Headcount Reduced Reduced by by 4,408 4,408 Outsting Outsting Balance Balance Bonds Bonds Reduced Reduced by by JPY528.5bln JPY528.5bln Steadily carrying out out furr furr reforms targeted wards FY

14 Acceleration Furr Reform Furr reduction city bonds outsting ahead reform plan In In past past five five years years (FY ) (FY ) outsting outsting balance balance city city bonds* bonds* were were reduced reduced by by JPY528.5bln JPY528.5bln Initial Initial target target reducing reducing JPY500bln JPY500bln city city bonds bonds was was accomplished accomplished two two years years ahead ahead schedule schedule *Bond fund savings exempted from tal outsting bonds On On p p reform reform target target JPY500bln JPY500bln furr furr reduction reduction approx. approx. JPY100bln JPY100bln was was accomplished accomplished (JPY bln) 1,600 1,400 1,200 1,000 1,501 1,477 1,447 In FY2006, city bonds related Hanshin-Awaji earthquake recovery fund lending had been redeemed. Thus, outsting balance bonds had significantly declined by JPY345.6bln Approx. JPY1trn earthquake related bonds were issued 1,384 1, Outsting Balance city bonds related earthquake damage Impact earthquake has been gradually decreasing Approx Amount reduced (Budget) 34.2 (FY) 13

15 3. Future Vision Kobe Funding Plans Take f from Kobe Airport (Aug-2007) 14

16 Future Vision Kobe Creative Creative city city planning planning strategy strategy in in mid-long mid-long term term horizon horizon DESIGN DESIGN CITY CITY KOBE KOBE Medium-term Medium-term plan plan Kobe Kobe VISION VISION Medical Medical Industry Industry Development Development Projects Projects enhance enhance attractiveness attractiveness vitality vitality DESIGN DESIGN CITY CITY KOBE KOBE Through five design perspectives, mid-long term city planning strategy aims create new attractions vitality improve quality living, by redefining Kobe s uniqueness KOBE KOBE VISION VISION World s fastest Supercomputer site image Future Vision: Furr vitalize city citizens Affluent Creative, Kobe PDCA Cycle implemented manage progress 96% measures are reported as being favorable or generally favorable New basic plans be launched In July-2008, Next-term Basic Plan Proposal Garing was held Living 1. Affluent life 2. Capitalize unique attractiveness 3. Vitalize economy 4. Encourage creativity 5. Maturing mental mind hling it next generation Five perspectives links People, Product Manufacturing (Monozukuri) Under changing social environment, Kobe aims following A city where residents wish continue staying Attractive city visirs A city with sustainable development Medical Medical Industry Industry Development Development Project Project Since 1998, had enticed medical-related industries Port Isl with aim establish a research development center for leading-edge medical technology Designated as an" Intellectual Cluster Formation Project by Ministry Education authorized as one Japanese government s Urban Renaissance Projects being promoted as a national project Next-Generation Supercomputer operated as key driver for foundation world s most advanced research education hub 15

17 Kobe s Funding Plans Kobe will continue keep a close dialogue with invesrs in its funding practice From From FY2008, FY2008, all all transactions transactions are are now now structured structured as as issued issued through through Syndicated Syndicated Deals Deals To To respond respond invesr invesr dem/communicate dem/communicate with with market market achieve achieve fair fair pricing pricing Group Group presentations presentations one-on-one one-on-one meetings meetings are are held held proactively proactively Issuer Rating On May 2008, obtained following rating from Rating Investment Information, Inc. (R&I) AA AA (Outlook: Stable) New Financial Rankings Rank 1 Apart from ratings, R&I had announced financial ranking for municipalities in Dec The raking reflects relative evaluation prefectures government-designated cities based mainly on settlement accounts data R&I has decided utilize a four-tier evaluation scheme, with rankings be identified from highest ranking by Arabic numerals 1, 2, 3 4 (each category an equal 25%). Kobe ranks in second tier, reflecting s improving fiscal conditions Prefectures Designated Cities Tochigi Pref, Gunma Pref, Saitama Pref, Chiba Pref, Tokyo Metroplitan Gov t, Kanagawa Pref, Nagano Pref, Shizuoka Pref, Aichi Pref, Mie Pref, Saitama, Yokohama, Kawasaki, Shizuoka, Niigata, Hamamatsu * The fiscal condition is recovering a level comparable that or designated cities (R&I, News Release, 16 May 2008) 2 3 Miyagi Pref, Fukushima Pref, Fukui Pref, Gifu Pref, Shiga Pref, Okayama Pref, Yamaguchi Pref, Ehime Pref, Saga Pref, Oita Pref, Okinawa Pref, Sapporo, Sendai, Nagoya, Sakai, Kobe Aomori Pref, Ibaraki Pref, Toyama Pref, Ishikawa Pref, Yamanashi Pref, Kyo Pref, Osaka Pref, Nara Pref, Wakayama Pref, Tori Pref, Hiroshima Pref, Tokushima Pref, Kagawa Pref, Fukuoka Pref, Kumamo Pref, Miyazaki Pref (JPY bln) FY2009 FY2009 Bond Bond Issuing Issuing Schedule Schedule 4 Hokkaido Gov t, Iwate Pref, Akita Pref, Yamagata Pref, Niigata Pref, Hyogo Pref, Shimane Pref, Kouchi Pref, Nagasaki Pref, Kagoshima Pref, Chiba, Kyo, Osaka, Hiroshima, Kitakyushu, Fukuoka Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Total yr Bond yr Bond yr Bond yr Bond 10 Added Unit 20 Joint Local Gov't Bond Total 120 * Added Unit will be used increase issue. Timing is subject trend in interest rates /or invesr dem FY2008 FY2008 Issuance Issuance Results Results Tenor Coupon Issue size Price (per 100) Issue date Pricing date 5-year 1.27% JPY10bln Aug 6-Aug 10-year 1.76% JPY10bln July 10-July 20-year 2.38% JPY20bln* May 16-May 20-year#2 2.08% JPY10bln Feb 4-Feb *20-year bond had used JPY10bln Added Unit respond invesr dem increased issue size JPY20bln 16

18 For any inquiries, please contact: Bond Finance Section, Finance Department, Administration Finance Bureau, Kobe Phone: Kano-cho, Chuo-ku, Kobe (Invesr Relations English website) Arima Onsen (Hot spring)

19 Appendix Tax Revenue Expenditure (in JPYbln) Tax Revenue 3, , , , Expenditure By Items ,118 2, , , (93.6%) (93.2%) (93.3%) Kobe 2, , , , , , , , , , , , (94.3%) 2, , (94.4%) 2, , , (95.4%) FY1995 H H10 FY1996 H FY1997 H H13 H14 H15 H16 H17 H18 H19 H20 General Account FY2006 FY2007 Change * General Account Expenditure Payroll Mary Public Assistance Expense Debt Expenditure Total Payroll Debt Expenditure Average designated cities (93.4%) (93.8%) Break down FY2006 FY2007 Change Inhabitant Tax (Individual) Inhabitant Tax (Corporations) (0.16) Property Tax Planning Tax Or Total (94.2%) Public Assistance Investment (94.2%) (95.5%) * ( ): tax revenue ratio *Debt expenditure in FY2005 does not include redemption amount city bonds (JPY300bln) relating investment/loan recovery fund (Budget) ,794 (FY) Appedix-1

20 Appendix FY2007 Results Special Corporate Accounts (in JPYbln) FY2008 Budget FY2007 Result FY2006 Result Amount Amount Amount Name Special Account Transferred Transferred Transferred Expenditures Expenditures Expenditures General General General Accounting Accounting Accounting National debt service National health insurance Healthcare for elderly Care insurance Geriatric care for latter-stage elderly Market business Meat center Workers' benefit Agricultural insurance Benefit/support for farless families/widows L acquisition for future development Parking business Rural community sewerage Seacoast environment maintenance Urban area redevelopment provided housing Airport maintenance Total Account Description Accounts FY 2008 P/L (Budget) FY 2007 P/L (Final) FY 2006 P/L (Final) Sewerage System Sewage disposal Port Harbor Management operation Port Kobe Urban Development Development allotment sales residential industrial estates Hospital Service Operation civilian hospitals Aumotives bus services Rapid Transit Railway Subway services Waterworks Waterworks Industrial Waterworks Waterworks for companies Total FY2007 Balance Payments 3 accounts in black Support farless families/widows JPY 0.4bln Care insurance JPY 1.6bln Airport JPY 0.1bln Ors are balanced with no accounts in red Appedix-2

21 Appendix - Fiscal Indicars Respective Cities Ordinary Balance Ratio Financial Capability Index Consolidated Real Deficit Ratio Real Debt Payment Ratio Future Burden Ratio 3 year Average 3 year Average Saitama 86.1 Hamamatsu 86.4 Shizuoka 87.4 Niigata 88.6 Kawasaki 93.5 Sakai 93.7 Fukuoka 94.2 Yokohama 94.2 Sapporo 95.3 Chiba 96.5 Nagoya 97.2 Sendai 97.4 Kitakyushu 97.7 Kyo 97.8 Kobe 98.0 Hiroshima 98.4 Osaka 99.9 Average 94.3 Kawasaki 1.06 Nagoya 1.02 Saitama 1.01 Chiba 1.00 Yokohama 0.98 Osaka 0.93 Hamamatsu 0.91 Shizuoka 0.90 Sendai 0.83 Fukuoka 0.83 Sakai 0.80 Hiroshima 0.79 Kyo 0.72 Niigata 0.70 Kobe 0.69 Kitakyushu Sapporo Average 0.86 Sapporo - Sendai - Niigata - Saitama - Chiba - Kawasaki Yokohama Shizuoka - Hamamatsu Nagoya - Osaka - Sakai - Kobe - Hiroshima Kitakyushu Fukuoka - Kyo Average Kitakyushu 6.3 Sakai 7.1 Saitama 8.3 Sapporo 10.8 Shizuoka 11.2 Niigata 11.5 Osaka 11.8 Hamamatsu 12.9 Kyo 12.9 Sendai 13.6 Nagoya 14.1 Hiroshima 16.1 Kawasaki 16.3 Kobe 17.1 Fukuoka 18.4 Chiba 19.6 Yokohama 20.6 Weighted Average 14.2 Sakai 70.7 Saitama 72.1 Shizuoka Hamamatsu Niigata Kawasaki Sapporo Sendai Kitakyushu Kobe Nagoya Kyo Hiroshima Fukuoka Osaka Yokohama Chiba Weighted Average Kobe single year Kobe single year 14.8 Appedix-3

22 System Local Authority Bonds (LAB) in Japan Mechanism Principal & Interest (P&I) (P&I) repayment assured Securing financial resources for repayment P&I Obtain local tax revenue based on right taxation Budget expenditure for public bonds (for P&I repayment) as a part annual expenditure in budget proposals Obtain a level local allocation taxes enough match annual expenditure including expenditure for public bonds with revenue Include a part LAB P&I repayment fund in stard financial needs in calculation local allocation taxes Bond issuance permission system as a prompt corrective action Restriction issuance on local authorities with real debt expenditure ratio 18% Restriction issuance on local authorities with deficit The national government secures financial resources for repayment LAB P&I The system aims avoid problems in repayment LAB P&I by each local government authority Action take if real deficit exceeds a prescribed level=financial Reconstruction Financial reconstruction under state control Consultation with consent national government is required on it Annual budget must be adjusted in accordance with reconstruction plan Repayment is assured because national government will be involved in budget-making Appedix-4

23 Tax-Exemption for interest on transfer local authority bonds Outline Outline tax-exemption for for interest interest on on LAB LAB payable non-residents, etc. etc. The following revisions are applicable interest on transfer LAB payable after January 1, For interest on transfer LAB payable non-residents or foreign legal entities, income tax or corporate tax shall not be imposed if application tax-exemption application submitted for withholding exemption as in case transfer national bonds Preferential measures shall be prescribed for those already submitted application tax-exemption for interest on transfer national bonds y should aumatically obtain tax-exemption for interest on transfer LAB under certain conditions Transfer local authority Bonds A new system transfer LAB: By book-entry increase/reduction balance in ledger transfer account in transfer institution or account management institution (completely paperless), such bonds shall be treated as transfer LAB As for general bond transfer system, Japan Securities Deposiry Center shall be transfer institution system starts on January 10, 2006 As for new issuance transfer bonds transfer outsting bonds transfer bonds, consent issuers for transfer institutions are required. However, almost all prefectural governments, ordinancedesignated cities municipal governments, who issued bonds, have already given consent Appedix-5