ORIX Corporation (ORIX) operates as a financial services company with significant leasing, lending, real estate development and other operations based on investment in tangible assets.
Business Segments
The company operates through ten segments include Corporate Financial Services and Maintenance Leasing, Real Estate, PE Investment and Concession, Environment and Energy, Insurance, Banking and Credit, Aircraft and Ships, ORIX USA, ORIX Europe, Asia and Australia.
Corporate Financial Services...
ORIX Corporation (ORIX) operates as a financial services company with significant leasing, lending, real estate development and other operations based on investment in tangible assets.
Business Segments
The company operates through ten segments include Corporate Financial Services and Maintenance Leasing, Real Estate, PE Investment and Concession, Environment and Energy, Insurance, Banking and Credit, Aircraft and Ships, ORIX USA, ORIX Europe, Asia and Australia.
Corporate Financial Services and Maintenance Leasing
This segment consists of finance and fee business; leasing and rental of automobiles, electronic measuring instruments, and ICT-related equipment.
In corporate financial services, the company engagesin financial businesses with a focus on profitability, and fee businesses by providing life insurance and real estate brokerage products and services to domestic small and medium-sized enterprise customers, as well as business succession support and M&A broking. In the automobile-related businesses, the company possess an industry-leading number of fleets and provide one-stop access to a full range of automobile services. In the rental business operated by ORIX Rentec Corporation, the company is not only providing electronic measuring instruments and ICT-related equipment lending, but it is also developing new services relating to robots, 3D printing, etc.
Real Estate
This segment consists of real estate development, rental and management, facility operation, and real estate asset management.
The company is promoting portfolio rebalancing by taking advantage of favorable market conditions, while also making carefully selected investments in real estate projects based on thorough assessments of profitability and risk, in light of rising construction costs and other external factors. To stabilize the company’s earnings base, it is developing businesses that are less susceptible to real estate market fluctuations, such as asset management, housing-related businesses focused on residential condominium development, and the operation of hotels and Japanese inns. From an operational perspective, the company is working to strengthen the entire value chain by improving efficiency and service quality, including the use of digital transformation.
PE Investment and Concession
This segment consists of private equity investment and concession.
The company is expanding investments in its focus industries and, in addition to rollups starting from existing investees, the company seeks to capture investment opportunities arising from business succession needs due to the absence of a successor, as well as carve-outs and take-private transactions as part of corporate restructurings. The company also seeks diversified investment methods. In the concession business, it intends to strengthen its operations in the three airports in Kansai (Kansai International Airport, Osaka International Airport and Kobe Airport), and proactively engage in the operation of public infrastructures other than airports.
Environment and Energy
This segment consists of domestic and overseas renewable energy, electric power retailing, ESCO services, sales of solar panels, and recycling and waste management.
The company intends to increase services revenue as a comprehensive energy service provider by promoting its renewable energy business and electric power retailing business. In the company’s solar power generation business, it has owned and operated one of the largest solar power capacities in total in Japan. The company intends to accelerate its renewable energy business overseas by utilizing the expertise the company has gained in the domestic market. The company is accelerating the restructuring of its business portfolio through capital recycling.
Insurance
This segment consists of life insurance.
In the life insurance business, the company sells life insurance through agents, banks and other financial institutions, face-to-face sales through its own consulting services, and online sales. With a core policy in product development to promptly provide products that meet the diverse and evolving needs of the company’s customers. In addition, the company is improving investment returns by expanding investments in high-yield assets, including alternative assets, and by flexibly reallocating its investment portfolio.
Banking and Credit
This segment consists of banking and consumer finance.
In the banking business, the company intends to improve profitability by expanding the scope of its merchant banking operations in addition to the origination of real estate investment loans, which remains the core of the company’s banking business. In the consumer finance business, the company intends to enhance its personal financial services by forming joint ventures with companies that has a strong customer and business base.
Aircraft and Ships
This segment consists of aircraft investment and management, and ship-related finance and investment, maritime asset management and ship brokerage.
In the aircraft-related business, the company is focusing on a wide range of profit opportunities, including operating leases of owned aircraft, sale of aircraft to investors, and asset management services for aircraft owned by domestic and overseas investors. The company intends for medium- and long-term growth by further enhancing its presence in the global aircraft-leasing market through various initiatives, including mutually complementary relationships with Avolon. In the ship-related business, the company is promoting asset replacement based on market conditions, expanding fee income by arranging investments in ships for domestic corporate investors, and pursuing business expansion in terms of scale and scope through strategic acquisitions.
ORIX USA
This segment consists of finance, investment, and asset management in the Americas.
ORIX Corporation USA is strategically expanding its business domains and developing a diverse range of businesses, including corporate finance, bond investment, real estate finance, and private equity investment. In addition, by managing third-party off-balance sheet assets, the company is working to appropriately control asset size and secure stable fee income.
ORIX Europe
This segment consists of asset management of global equity and fixed income.
In this segment the company engages in the asset management business through investments in stocks, bonds, etc. In addition to the focus on expanding the existing businesses by leveraging the company’s expertise as a pioneer in sustainable investment, it is working to increase assets under management and enhance profitability through initiatives such as broadening the company’s lineup of active ETFs and offering white-label products. The company also engages in capturing a wide range of business opportunities including M&A as the strategic business location of ORIX Group in Europe.
Asia and Australia
This segment consists of finance and investment businesses in Asia and Australia.
The company’s overseas subsidiaries are primarily engages in financial services such as leasing and lending across Asian countries and Australia and invest in private equity in Asian countries, particularly in China. The company will further enhance the functions of its overseas subsidiaries and further invest in targeted markets to expand the company’s business with an emphasis on profitability.
Business Regulation
ORIX and its group companies in Japan are incorporated under, and the company’s corporate activities are primarily governed by, the Companies Act and other Japanese laws.
ORIX and certain of its group companies engages in the moneylending business in Japan. Accordingly, pursuant to the Moneylending Business Act, ORIX and certain of its group companies have registered with the Prime Minister or various prefectural governors, established the necessary internal systems, and provide the necessary reporting and notification to the Financial Services Agency (FSA).
Certain businesses conducted by ORIX and its group companies are governed by the Financial Instruments and Exchange Act. Certain of the company’s group companies has obtained Construction Business Licenses from MLIT for constructing buildings and conducting interior finishing work. ORIX and certain of its group companies, including ORIX Real Estate Corporation and DAIKYO, are required to be licensed by the Ministry of Land, Infrastructure Transport and Tourism (MLIT) or relevant prefectural governors under the Building Lots and Buildings Transaction Business Act to engage in activities such as the buying and selling land and buildings in Japan, and their operations are regulated by such laws, including the maintenance of registered real estate transaction managers on staff and the duty to provide and deliver material information to counterparties. In addition, lodging facilities, such as Japanese inns and hotels, operated by ORIX Hotel Management Corporation have licenses from relevant prefectural governors under the Inns and Hotels Act, etc.
ORIX’s wholly owned subsidiaries ORIX Asset Management Corporation (‘OAM’) and ORIX Real Estate Investment Advisors Corporation (‘ORIA’) are each registered with the Prime Minister under the Financial Instruments and Exchange Act as an investment manager and regulated by the Financial Services Agency (FSA). ORIA is also registered to engage in the Type II Financial Instruments Business and the Investment Advisory and Agency Business.
The businesses that consists of the company’s renewable energy business, such as its solar power generation business, are subject to and must comply with various requirements and regulations in the jurisdictions where they operate, including the Electricity Business Act, Environmental Impact Assessment Act and Act on Special Measures Concerning Procurement of Electricity from Renewable Energy Sources by Electricity Utilities in Japan and similar laws and regulations in other jurisdictions, when setting up a power generation facility, including business notification requirements, regulations relating to the facility location, and other various regulations, such as those designed to protect the environment and visual landscape and ensure safety from the perspective of disaster prevention.
To engage in the life insurance business, ORIX Life Insurance has obtained and maintains a license from the Prime Minister under the Insurance Business Act. ORIX Bank is licensed by the Prime Minister to engage in the banking and trust business and is regulated under the Banking Act and the Act on Engagement in Trust Business by Financial Institutions.
Certain subsidiaries of ORIX Corporation USA manage private investments, collateralized loan obligations and separately managed accounts and are registered as investment advisers with the SEC under the U.S. Investment Advisers Act of 1940, as amended (‘Advisers Act’) and are subject to the requirements and regulations of the Advisers Act.
Lument Securities, a wholly owned subsidiary of ORIX Corporation USA, through which the company conducts an investment banking, private placement and municipal securities business, is registered as a broker-dealer with the U.S. Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (‘FINRA’). Lument Securities is a municipal securities dealer registered with the SEC and the Municipal Securities Rulemaking Board (‘MSRB’), and hence is subject to regulation and oversight by the SEC, FINRA, and the MSRB. Lument Securities is registered as a broker-dealer in 53 U.S. jurisdictions, and as a result is a member of and is subject to regulation by FINRA, a self-regulatory organization subject to oversight by the SEC that adopts and enforces rules governing the conduct, and examines the activities, of its member firms.
By virtue of their involvement in the multifamily and seniors housing mortgage lending business, Lument and its mortgage company subsidiaries must comply with rules and regulations administered by the Government National Mortgage Association, the Federal National Mortgage Association, the Department of Housing and Urban Development/Federal Housing Administration, the United States Department of Agriculture, and the Federal Home Loan Mortgage Corporation.
Dutch-regulated subsidiaries of ORIX Corporation Europe N.V. (OCE) is subject to European financial supervisory regulation, including, amongst others and as the case may be, the Alternative Investment Fund Managers Directive, the Undertakings for Collective Investment in Transferable Securities (‘UCITS’) Directive, the Markets in Financial Instruments Directive, the European Market Infrastructure Regulation, the Market Abuse Regulation, the 5th Anti-Money Laundering Directive, the Benchmark Regulation, the Securities Financing Transactions Regulation and the Shareholder Rights Directive II. A Swiss regulated subsidiary of OCE is subject to the Swiss equivalent of these financial supervisory regulations (such as the Federal Act on Collective Investment Schemes, the Federal Ordinance on Collective Investment Schemes, the FINMA Collective Investment Schemes Ordinance, the Financial Services Act, the Financial Institutions Act, the Anti-Money Laundering Act, the Anti-Money Laundering Ordinance, the FINMA Anti-Money Laundering Ordinance). UK-regulated subsidiaries of OCE are subject to the UK Financial Conduct Authority (‘FCA’) Conduct of Business Sourcebook. U.S.-regulated subsidiaries of OCE are subject to regulation, primarily at the federal level, by the SEC, Department of Labor, Federal Reserve, Office of the Comptroller of the Currency, FINRA, National Futures Association (‘NFA’), Department of Justice, Commodity Futures Trading Commission (‘CFTC’) and New Hampshire Banking Department (‘NHBD’), as well as being subject to the Advisers Act.
Robeco Institutional Asset Management B.V. (‘RIAM’), a subsidiary of OCE and part of the Robeco group, is registered as an alternative investment fund manager (‘AIFM’) and fund manager of UCITS in the Netherlands and regulated by the Dutch Authority for the Financial Markets (‘AFM’) and the Dutch Central Bank (‘DNB’).
Transtrend B.V., a wholly owned subsidiary of OCE that offers asset management and commodity trading advisory services, is registered as an alternative investment fund manager (AIFM) in the Netherlands and regulated by the AFM and DNB. Transtrend is also registered with the NFA, regulated by the Commodity Futures Trading Commission (CFTC) and licensed by the China Securities Regulatory Commission.
Boston Partners Global Investors, Inc. (‘Boston Partners’) is a subsidiary of OCE and registered with the SEC as an investment adviser. Boston Partners is also a member of the NFA and is registered as a commodity pool operator and as a commodity trading adviser with the CFTC. Furthermore, Boston Partners is registered with the Financial Services Commission of Korea (FSC).
Harbor Capital Advisors, Inc. (‘Harbor’) is a subsidiary of OCE and is registered with the SEC as an investment adviser. Harbor is also a member of the NFA and is registered as a commodity pool operator with the CFTC. Certain subsidiaries of Harbor are registered with the SEC, NHBD and a member of FINRA.
Gravis Capital Management Ltd (‘Gravis’), a subsidiary of OCE, is a UK asset manager and is authorized as a full-scope UK AIFM by the FCA. A subsidiary of Gravis is also authorized by the FCA.
Among group companies in the segment, ORIX Asia Limited is registered with the Hong Kong Monetary Authority as a restricted license bank. A wholly owned subsidiary of ORIX Leasing Malaysia Berhad has a money lending license from the Malaysia Ministry of Housing and Local Government and is registered with Bank Negara Malaysia. PT. ORIX Indonesia Finance has a financial institution business license and is regulated by the Indonesia Financial Services Authority. ORIX Australia Corporation Limited is registered with the Australian Prudential Regulation Authority as a registered finance corporation. ORIX Capital Korea Corporation is registered with the Korea Financial Supervisory Service as a specialized credit finance business company. ORIX Asia Asset Management Co., Limited is registered with the Hong Kong Securities and Futures Commission as a licensed entity to carry on Type 1, 4 and 9 regulated activities.
History
The company was incorporated in 1950. The company was formerly known as Orient Leasing Co., Ltd. and changed its name to ORIX Corporation in 1989.
