Americas EQD boost Nomura’s revenues

Nomura Holdings has posted a net revenue in its global markets (GM) business of JPY163.8 billion (US$1.42 billion) from October to December, a 19% increase quarter-on-quarter (QoQ), or down 13% year-on-year (YoY), according to its latest quarterly earnings.

Cash equities also delivered ‘robust performance’ in Americas. ‘Although securitised products revenues increased, fixed income revenues declined QoQ due to a slowdown in rates,’ said the bank referring to the region. 

Equities and fixed income accounted for 46.3% and 53.7% of the GM net revenue, respectively. The Americas was the only region delivering growth in the equities division as Asia ex-Japan saw its equities net revenue falling by 15% QoQ mainly due to derivatives and a slow-down in Japan’s cash equities business.

‘In wholesale, our global markets business reported a rebound in credit and FX/EM in Asia ex-Japan and equity derivatives in the Americas,’ said Nomura President and Group CEO Kentaro Okuda (pictured).

GM contributed to 80.8% of the net revenue at the wholesale segment while the remaining was from investment banking.

By region, Americas remains the main market making up 41.9% of the wholesale revenue, or JPY84.9 billion, which represented a recovery from a loss of JPY126 billion from January to March and a net flow of JPY18 billion from April to June.

Next in line are Japan, Asia-ex Japan and Europe, the Middle East and Africa (Emea) with a respective share of 23.1%, 20.6% and 14.4%. Nomura exited the EQD business in Emea in 2016, as reported by SRP.

From October to December, Nomura International Funding issued 189 structured notes with a total notional of US$686m-equivalent in Taiwan and one five-year credit-linked note distributed by Sberbank CIB in Russia, SRP data shows. 

The autocallable products in Taiwan tracked unspecified share baskets and featured snowball, range and accrual payoffs - there were 120 products with a tenor between one to three years with the remaining lasting for less than one year, according to SRP data.

Groupwide, wholesale continues to be the backbone segment after generating 57.7% of the entire net revenues in Q3, followed by retail (24.9%) and investment management (11.4%).

In the meantime, the total pre-tax income rose 4.3x to JPY80.1 billion QoQ, or down 39% YoY, of which wholesale, investment management and retail accounted for 50.9%, 25.5% and 22.5%, respectively.

Retail reported net revenues of JPY87.4 billion in Q3, up three percent QoQ and down 11% YoY. Investment management net revenue was JPY40.1 billion yen, translating to an increase of 17% QoQ and two percent YoY.

‘Investment management saw continued global inflows across various channels, lifting assets under management to an all-time high (JPY68.5 trillion),’ said Okuda. ‘In retail, we made progress toward a more stable revenue mix, as higher recurring revenue assets drove growth in recurring revenue underpinned by our continued focus on the total assets of our clients.’

Click here to view Nomura Holding’s Q3 FY21/22 earnings presentation.