Nomura Holdings Inc on Thursday posted a net annual loss of 100.4 billion yen, its first time in the red in a decade, as the investment bank struggles to right its wholesale business and drastically pare back costs.
In the fourth quarter ended March, Japan’s biggest investment bank and brokerage posted a net profit of 800 million yen, versus 22.7 billion yen a year earlier.
“The result was very much disappointing,” Chief Financial Officer Takumi Kitamura told reporters at an earnings briefing, adding that directors’ bonus will not be paid to executives of Nomura Holdings and Nomura Securities.
Nomura, this month, announced a sweeping restructuring plan that includes cutting $1 billion in costs from its wholesale business and shutting more than 30 of 156 domestic retail branches.
The wholesale business has been squeezed by lower trading revenue in fixed income. The sizeable loss speaks to the scale of the challenge ahead for Nomura and its CEO Koji Nagai.
As part of the cost-cutting overhaul, Nomura also plans to axe about 100 jobs in London, the centre for its European banking business, Reuters has previously reported.
But Nagai has no plan to follow the lead of Wall Street rivals and seek a tie-up with a commercial lender, he recently told Reuters, eschewing a model that has redefined investment banking since the global financial crisis.
While it lacks the lending firepower of a commercial bank, Nomura’s independence means it is not confined by the banking relationships of other lenders and can do deals with anyone in Japan, Nagai has said.© (c) Copyright Thomson Reuters 2019.