※Translated with Notion AI. (Plus version)
An article titled “Shaking Balance – From the Courtroom -” published in the Nikkei Newspaper on July 21, 2023, discussed issues related to structured bonds, particularly targeting elderly mothers.
Following this article, I received several inquiries about my views.
Based on my experience leading a team that structured bonds worth several hundred billion yen at a major foreign securities company, I’d like to share my thoughts.
Firstly, Japan has the highest amount of personal savings globally.
It’s true that investor protection is lacking in this context.
It’s said that most profits of foreign securities in Japan come from individual investors.
There were indeed issues with the sales approach of structured bonds.
The “fee” oriented business model in Japan’s financial industry is also problematic.
However, the notion that “structured bonds are evil” or “securities companies are the only perpetrators,” as suggested in the article, is misguided.
Such reporting leads to a “loss of investment opportunities” for individual investors and does not improve the sale of financial products.
It can also cause “manipulation of impressions.”
To protect individual investors, it’s important to understand the realities on the ground, not just conduct a “witch hunt.”
The current issue is that not only sales companies but also journalists and authorities do not fully understand the risks and appeal of structured bonds. Blaming only the securities companies is unfair.
Allowing such low literacy to prevail undermines trust in financial institutions and causes individual investors to lose important investment opportunities.
We need to address the “understanding of risk” within the current securities industry association, authorities, and media. This will reveal a “list of perpetrators.”
Based on that, I propose an optimal “improvement plan for structured bond sales” for individual investors.
