Nomura Holdings, the Japanese financial holding company, performed strongly yet again and hit an annual net profit nine year high for its asset management and investment banking divisions.
As a holding company, Nomura owns the outstanding stock of other companies as well as shares, in order to form a corporate group.
Although Nomura’s overseas operations were in the red for the fifth year in a row, the steady Japanese stock market has helped funds flow into the company’s asset management and investment banking arm. The bank have also profited from a number of M&A deals which have led to international investment banking revenues being at their strongest in six years.
According to estimates from Thomson Reuters’s division, StarMine, Nomura Group’s profits for the year were 10% higher than the stock ranking system, and it rose to $1.9 billion. The fourth quarter alone saw a 34% surge from the same period the previous year and made a profit of 82 billion yen.
However, their international business did not make a profit at the end of the last financial year because the company had to manage overseas lawsuit costs.
One high-profile lawsuit for the company involves US regulators who are accusing Nomura and Royal Bank of Scotland for selling defective mortgage-backed securities.
CFO for Nomura, Shigesuke Kashiwagi, said that he regrets that the company couldn’t turn around their overseas operations profits but believes they will be able to achieve the company’s long-term goals. “I believe strongly that we will be able to achieve our long term goals and achieve solid profitability of the overseas business.”
Despite the $1 billion cost cuts carried out in 2012 by CEO Koji Nagai, the bank has long struggled to change the Europe and Asia operations it bought from Lehman Brothers Holdings in 2008. However, shares in Nomura have climbed 12% which correlate with the Tokyo share market gains caused by an influx of buying from pension funds.
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